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HomeMy WebLinkAbout2017 CON CDC Vista Del Sol Apartments - Refinancing Terms - Amended and Restated Loan AgreementASSIGNMENT, ASSUMPTION AND CONSENT AGREEMENT (Vista Del Sol -CDC -HA Loan Documents) THIS ASSIGNMENT, ASSUMPTION AND CONSENT AGREEMENT ("Agreement") is dated as of the 18th day of December, 2017, Copper Hills Apartments Limited Partnership, a California limited partnership ("Assignor"), Vista Del Sol Apartments, L.P., a California limited partnership ("Assignee"), and the Community Development Commission -Housing Authority of the City of National City ("CDC -HA"). RECITALS A. Assignor and the CDC -HA are all of the current parties to (collectively, the "CDC -HA Loan Documents"): (i) that certain Affordable Housing Agreement dated as of December 7, 1988; (ii) that certain Residual Receipts Promissory Note, dated February 18, 1999, in the original principal amount of $2,400,000.00; (iii) that certain Residual Receipts Promissory Note (Secured by Deed of Trust), dated June 1, 1999, in the original principal amount of $4,454,037.07. B. The Assignor desires to assign all of the Assignor's interest in the CDC -HA Loan Documents to the Assignee, and the Assignee desires to assume all of the Assignor's interest in the CDC -HA Loan Documents from and after the date hereof. C. The consent of the CDC -HA is a condition precedent to the assignment and assumption of the CDC -HA Loan Documents. NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the CDC -HA, Assignor and Assignee hereby agree as follows: 1. Assignment. Assignor assigns and transfers all of its rights, title, interest and obligations under and pursuant to the CDC -HA Loan Documents to Assignee concurrently with the conveyance of the Property from Assignor to Assignee. 2. Assumption. Assignee assumes and agrees to perform all of the obligations, covenants and agreements of Assignor from and after the date hereof under the CDC -HA Loan Documents, in the manner, at the times and in all other respects as therein provided. Assignee further agrees to be bound by all of the terms, covenants and conditions contained in the CDC -HA Loan Documents from and after the date hereof as though the CDC -HA Loan Documents had been originally made, executed and delivered by Assignee. 3. Consent. The CDC -HA hereby consents to Assignor's conveyance of the Property to Assignee and the assignment of all of Assignor's rights, title, interest and obligations under and pursuant to the CDC -HA Loan Documents, consents to Assignee's assumption of the same, and agrees that the rights of Assignor under the CDC -HA Loan Documents shall inure to the benefit of Assignee. Assignor and Assignee hereby execute this Agreement, on the following express 1 conditions and understandings: The consent of the CDC -HA to the assignment and assumption as contemplated by this Agreement shall not be deemed consent to any other or subsequent conveyances of the Property, or any part thereof. Assignee shall not convey or otherwise transfer all or any part of the Property without the prior written consent of the CDC -HA, which consent shall not be unreasonably withheld. Any conveyance or other transfer of all or any part of the Property without the prior written consent of the CDC -HA, shall be a material breach of the CDC -HA Loan Documents and this Agreement. 4. General Provisions. (a) Binding Effect/No Third Party Beneficiaries. All of the terms and provisions of this Agreement shall be binding upon and inure to the benefit to the parties hereto and respective heirs, legal representatives, successors and assigns. This Agreement is made for the sole benefit and protection of the parties hereto, and their successors and assigns, and no other party shall have any right of action or right to rely hereon. (b) No Novation. Except as otherwise set forth in this Agreement, the parties agree that this Agreement is not in any way intended to, and does not, revise, amend or otherwise affect any of the terms, conditions or priority of the CDC -HA Loan Documents or any other agreement or document by and between the CDC -HA, Assignor or Assignee, nor the enforcement thereof. The parties hereby agree the provisions of the CDC -HA Loan Documents and all other agreements or documents by and between the CDC -HA, Assignor or Assignee shall be and remain unmodified and in full force and effect. (c) Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. (d) Signature Authority. All individuals signing this Agreement for a party which is a corporation, limited liability company, partnership or other legal entity, or signing under a power of attorney, or as a trustee, guardian, conservator, or in any other legal capacity, covenant to the others that they have the necessary capacity and authority to act for, sign and bind the respective entity or principal on whose behalf they are signing. IN WITNESS WHEREOF, this Agreement is executed to be effective as of the date first above written. ASSIGNOR: Copper Hills Apartments Limited Partnership, a California limited partnership By: Print Nam Its: r1A!,,J 0 [SIGNATURES CONTINUED ON FOLLOWING PAGE] 2 ASSIGNEE: Vista Del Sol Apartments, L.P., a California limited partnership By: Vista Del Sol GP LLC, a California limited liability company, its general partner By: National Community Renaissance of California, a California nonprofit public benefit corporation, its managing e ber By: 4 Its: C, P n [SIGNATURES CONTINUED ON FOLLOWING PAGE] CDC -HA: THE COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY, Bye / ....h.t, Its: Executive Director Approved as to form: By: 1\444 puty City Attorney ASSIGNMENT, ASSUMPTION AND CONSENT AGREEMENT (Vista Del Sol -City Ground Lease) THIS ASSIGNMENT, ASSUMPTION AND CONSENT AGREEMENT ("Agreement") is dated as of the 18th day of December, 2017, Copper Hills Apartments Limited Partnership, a California limited partnership ("Assignor"), Vista Del Sol Apartments, L.P., a California limited partnership ("Assignee"), and the City of National City ("City"). RECITALS A. Assignor and the City are all of the current parties to that certain Ground Lease dated as of August 15, 2000. B. The Assignor desires to assign all of the Assignor's interest in the Ground Lease to the Assignee, and the Assignee desires to assume all of the Assignor's interest in the Ground Lease from and after the date hereof. C. The consent of the City is a condition precedent to the assignment and assumption of the Ground Lease. NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the City, Assignor and Assignee hereby agree as follows: 1. Assignment. Assignor assigns and transfers all of its rights, title, interest and obligations under and pursuant to the Ground Lease to Assignee concurrently with the conveyance of the Property from Assignor to Assignee. 2. Assumption. Assignee assumes and agrees to perform all of the obligations, covenants and agreements of Assignor from and after the date hereof under the Ground Lease, in the manner, at the times and in all other respects as therein provided. Assignee further agrees to be bound by all of the terms, covenants and conditions contained in the Ground Lease from and after the date hereof as though the Ground Lease had been originally made, executed and delivered by Assignee. 3. Consent. The City hereby consents to Assignor's conveyance of the Property to Assignee and the assignment of all of Assignor's rights, title, interest and obligations under and pursuant to the Ground Lease, consents to Assignee's assumption of the same, and agrees that the rights of Assignor under the Ground Lease shall inure to the benefit of Assignee. Assignor and Assignee hereby execute this Agreement, on the following express conditions and understandings: The consent of the City to the assignment and assumption as contemplated by this Agreement shall not be deemed consent to any other or subsequent conveyances of the Property, or any part thereof. Assignee shall not convey or otherwise transfer all or any part of the Property without the prior written consent of the City, which consent shall not be unreasonably withheld. Any conveyance or other transfer of all or any part of the Property without the prior written consent of the City, shall be a material breach of the Ground Lease and this Agreement. 1 4. General Provisions. (a) Binding Effect/No Third Party Beneficiaries. All of the terms and provisions of this Agreement shall be binding upon and inure to the benefit to the parties hereto and respective heirs, legal representatives, successors and assigns. This Agreement is made for the sole benefit and protection of the parties hereto, and their successors and assigns, and no other party shall have any right of action or right to rely hereon. (b) No Novation. Except as otherwise set forth in this Agreement, the parties agree that this Agreement is not in any way intended to, and does not, revise, amend or otherwise affect any of the terms, conditions or priority of the Ground Lease or any other agreement or document by and between the City, Assignor or Assignee, nor the enforcement thereof. The parties hereby agree the provisions of the Ground Lease and all other agreements or documents by and between the City, Assignor or Assignee shall be and remain unmodified and in full force and effect. (c) Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. (d) Signature Authority. All individuals signing this Agreement for a party which is a corporation, limited liability company, partnership or other legal entity, or signing under a power of attorney, or as a trustee, guardian, conservator, or in any other legal capacity, covenant to the others that they have the necessary capacity and authority to act for, sign and bind the respective entity or principal on whose behalf they are signing. IN WITNESS WHEREOF, this Agreement is executed to be effective as of the date first above written. ASSIGNOR: Copper Hills Apartments Limited Partnership, a California limited partnership By: it' Print Name: in Ie44 CL i /n%,✓ Its: e'Fr© [SIGNATURES CONTINUED ON FOLLOWING PAGE] 2 ASSIGNEE: Vista Del Sol Apartments, L.P., a California limited partnership By: Vista Del Sol GP LLC, a California limited liability company, its general partner By: National Community Renaissance of California, a California nonprofit public benefit corporation, its managing member By: f Its: [SIGNATURES CONTINUED ON FOLLOWING PAGE] City: THE COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY, By: r -c+1 K. Its: Executive Director Approved as to form: By: Deputy City Attorney AMENDED AND RESTATED LOAN AGREEMENT VISTA DEL SOL APARTMENTS $7,407,795.08 LOAN THE COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY, LENDER AND VISTA DEL SOL APARTMENTS, L.P., BORROWER Amended and Restated Loan Agreement -Vista Del Sol AMENDED AND RESTATED LOAN AGREEMENT This Amended and Restated Loan Agreement (the "Agreement") is dated as of December 18, 2017, between the Community Development Commission -Housing Authority of the City of National City ("Lender" or "City"), a public body, corporate and politic, and Vista Del Sol Apartments, L.P. ("Borrower"), a California limited partnership. RECITALS This Agreement is entered into based on the following facts and understandings of the parties: A. Borrower proposes to assume and modify the ownership structure of Vista Del Sol Apartments, a 132-unit affordable rental housing development at 1545 Q Avenue, in National City, CA (the "Property"). B. The Community Development Commission of the City of National City ("Original Lender"), and Copper Hills Apartments Limited Partnership, a California limited partnership ("Prior Owner"), entered into that certain Affordable Housing Agreement dated as of December 7, 1988 ("Affordable Housing Agreement"). Pursuant to which the Prior Owner received a secured loan from Original Lender, from the Original Lender's Low and Moderate Income Housing Fund and from HOME funds in an original principal amount of $2,400,000, secured by deed of trust recorded on the property with the San Diego County Recorder on May 27, 1999, as Instrument No. 1999-0363599 ("Former RR Loan"), which is more particularly described in the Affordable Housing Agreement. The Former RR Loan funds have been fully disbursed. $771,658 in principal remains outstanding and $3,797 in interest has accrued as of December 12, 2017, under the Former RR Loan. C. The Prior Owner received a second secured loan from the Original Lender from the Original Lender's issuance of tax allocation bond proceeds in an original principal amount of $4,454,037.07, secured by deed of trust recorded on the property with the San Diego County Recorder on June 2, 1999, as Instrument No. 1999-0382563 ("Former Rehab Loan"), which is more particularly described in the Affordable Housing Agreement. The Former Rehab Loan funds have been fully disbursed. $4,454,037 in principal remains outstanding and $2,349,504 in interest has accrued as of December 12, 2017, under the Former Rehab Loan. The Former Rehab Loan together with the Former RR Loan, shall be referred to herein together, as the "Former Loan." D. The Lender elected to retain the housing assets of and functions previously performed by the Original Lender pursuant to California Health and Safety Code Section 34176, and thereby, by operation of law, the Lender assumed the rights and obligations of the Original Lender with respect to the Affordable Housing Agreement. E. Concurrently herewith the Borrower is acquiring the Property from Prior Owner, the Borrower is assuming all of the rights and liabilities of the Original Owner with respect to the Affordable Housing Agreement and with respect to the Consolidated, Amended and Restated Promissory Note, as defined below. The Lender and Borrower desire to amend and restate the Affordable Housing Agreement in its entirety, as provided herein. Concurrently with this Agreement, the promissory notes for the Former Loan are being consolidated, amended and restated into a single Amended and Restated Promissory Note which will be executed by Borrower in the original principal amount of $7,407,795.08 ("Loan"). Each deed of trust securing the Former Loan is being reconveyed, and a new Deed of Trust securing the Loan is 2 being executed and recorded against the Property. The previous regulatory agreements and restrictive covenant executed in connection with the Former Loan will be amended and restated by Borrower and Lender concurrently with this Agreement and recorded against the Property. These instruments are intended to secure Lender's continuing interest as a governmental entity in the affordability and habitability of the Property, as well as to secure performance of other covenants contained in such agreements. NOW, THEREFORE, in consideration of the foregoing recitals (which are hereby incorporated into this Agreement) and the covenants and mutual obligations contained in this Agreement, and in reliance on the representations and warranties set forth herein, Borrower and Lender hereby amend and restate the Affordable Housing Agreement in its entirety and agree as follows: DEFINITIONS 1. DEFINED TERMS. The following terms and their derivatives have the meanings set forth below wherever used in this Loan Agreement, attached Exhibits, or documents incorporated into this Loan Agreement by reference: reference. "Budget" means that budget for the Project attached as Exhibit B, incorporated herein by "Deed of Trust" means that Deed of Trust, Assignment of Rents, and Security Agreement recorded on the Property as security for the Loan by Borrower as trustor with Lender as beneficiary, as well as any amendments to, modifications of, and restatements of the deed of Trust. The terms of the Deed of Trust are hereby incorporated into this Agreement by this reference. Copies of the Loan Documents shall not be attached to and recorded as part of the Deed of Trust, but any breach of or misrepresentation under the Loan Documents shall, upon the expiration of any applicable notice and cure period(s), constitute an event of default under the Deed of Trust. "Eligible Costs" means those Project costs associated with the low and very low income affordable component of the Project. In addition, other items may be Eligible Costs if approved in writing by Lender. "Hazardous Materials" means any hazardous or toxic substances, materials, wastes, pollutants, or contaminants which are defined, regulated, or listed as "hazardous substances," "hazardous wastes," "hazardous materials," "pollutants," "contaminants," or "toxic substances," under applicable Hazardous Materials Laws, including without limitation petroleum and petroleum byproducts, flammable explosives, urea formaldehyde insulation, radioactive materials, asbestos, and lead. Hazardous Materials do not include substances that are used or consumed in the normal course of developing, operating, or occupying a housing project, to the extent and degree that such substances are stored, used, and disposed of in the manner and in amounts that are consistent with normal practice and legal standards. "Hazardous Materials Laws" means: the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. § 9601, et seq. ("CERCLA"); the Hazardous Materials Transportation Act, 49 U.S.C. § 1801 et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et seq. ("RCRA"); the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq.; the Clean Water Act, 33 U.S.C. § 1251 et seq.; the California Hazardous Waste Control Act, Health and Safety Code § 25100 et seq. the California Hazardous Substance Account Act, Health and Safety Code § 25330 et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code § 3 25249.5 et seq.; California Health and Safety Code § 25280 et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code § 25170.1 et seq.; California Health and Safety Code § 25501 et seq. (Hazardous Materials Release Response Plans and Inventory); or the California Porter -Cologne Water Quality Control Act, Water Code § 13000 et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance, or material, as now or any time hereafter in effect. "Limited Partners" means WNC California Holding, LLC, a California limited liability company, as investor limited partner, and WNC Housing, L.P., a California limited partnership as special limited partner. "Loan" means the loan of funds from Lender to Borrower, all of which have been fully disbursed, for the Project pursuant to this Agreement, consisting of the Former Loan that has been assumed under this Loan Agreement. "Loan Documents" means collectively this Amended and Restated Loan Agreement, the Deed of Trust, and the Consolidated, Amended and Restated Note, as they may be amended, modified, or restated from time to time, along with all exhibits and attachments to these documents. "Loan Funding Reserve" means the reserve in the amount of $1,200,000.00, $500,000 of which the Borrower shall fund at closing and $700,000 of which Borrower shall fund at permanent loan conversion. The Loan Funding Reserve shall be maintained in a separate account in the name of the Borrower, provided that no disbursements from the Loan Funding Reserve shall be made without the express written consent of the Lender. The Borrower shall account to the Lender for any monies expended from the reserves. "Note" or "Consolidated, Amended and Restated Note" mean the Consolidated, Amended and Restated Promissory Note executed by Borrower in favor of Lender evidencing the Loan, which is secured by the Deed of Trust, as well as any amendments to or modifications of the Note. The terms of the Notes are hereby incorporated into this Agreement by this reference. "Partnership Agreement" means the Amended and Restated Agreement of Limited Partnership of the Borrower dated on or about the date hereof, as amended from time to time. "Project" means the rehabilitation of the Property for residential and other uses as set forth in the attached Exhibit D, incorporated herein by reference. "Project Unit" means any housing unit developed on the Property as part of the Project. "Property" means all or any portion of the real property described in the attached Exhibit A, incorporated herein by reference, and any buildings or improvements now or hereafter situated on this real property. "Replacement Reserve" has the meaning set forth in Section 17 of the Regulatory Agreement. "Regulatory Agreement" or "Amended and Restated Regulatory Agreement" mean that Amended and Restated Regulatory Agreement executed by Borrower and Lender and recorded 4 against the Property contemporaneous with this Loan, which, inter alia, restricts the rents and occupancy of Project Units, as well as any amendments to or modifications of said Regulatory Agreement. "Schedule" means the schedule for submissions and Project development set forth in the attached Exhibit E, incorporated herein by reference. TERMS OF LOAN 2. LOAN ASSUMPTION. Notwithstanding the assumption by Borrower of the following documents, the parties hereby acknowledge and agree that the Affordable Housing Agreement, the promissory notes for the Former Loan, each deed of trust securing the Former Loan and the previous regulatory agreements and restrictive covenant executed in connection with the Former Loan (the "Preexisting Loan Documents") are of no further force and effect and to the extent of a conflict between the Preexisting Loan Documents and the Loan Documents, the Loan Documents shall control. 3. INTEREST. Starting on the date of this Agreement, this Loan shall bear simple interest at the rate equal to 3% per annum. 4. SECURITY. The Loan shall be secured by the Deed of Trust on the Property. 5. TERM OF LOAN. The Loan shall be repaid as provided for in the Note. 6. PREPAYMENT OF LOAN. No prepayment penalty will be charged to Borrower for payment of any portion of the Loan amount prior to the end of the Loan term. However, any prepayment of the Loan shall not affect Borrower's obligations under the Regulatory Agreement, which shall remain in full force and effect for the entire term of the Regulatory Agreement. 7. LIMITED RECOURSE. Except as provided below, this Loan is a nonrecourse obligation of Borrower. Neither Borrower nor its partners or members, nor any director or employee of Borrower or its partners or members, shall have any personal liability for repaying the principal or interest of the Loan. The sole recourse of Lender for repayment of the principal and interest shall be the exercise of Lender's rights with respect to the Property, as more specifically described in of the Deed of Trust. Notwithstanding the foregoing, the Loan shall be recourse to Borrower in the event of actual fraud by Borrower, or any material misrepresentation by Borrower to Lender, in connection with the Loan. Furthermore, Borrower shall be liable to Lender for any loss incurred by Lender due to (a) misapplication by Borrower of any Loan proceeds, (b) any willful or intentional damage caused by Borrower to the Property, or (c) the presence or release of any Hazardous Materials on or in the Property. CONDITIONS TO CLOSING 8. CONDITIONS PRECEDENT TO CLOSING. Lender is not obligated to close the Loan until all of the following conditions precedent have been satisfied: A. Borrower has executed and delivered the Note to Lender, and has executed and recorded the Deed of Trust and Regulatory Agreement on the Property. 5 B. There is no Event of Default by Borrower, nor any act, failure, omission or condition that would constitute an Event of Default (to the best of Lender's knowledge: (i) no Event of Default has occurred; and (ii) no event of omission has transpired that would with the passage of time result in an Event of Default). C. Lender is reasonably assured that rehabilitation of the Project would be consistent with the rules and regulations of all outside funding sources for the Loan, including HUD, and all other applicable legal standards. D. Borrower has timely delivered to Lender all documents required by the Loan Documents and the Regulatory Agreement, including evidence of insurance coverage, all permits, licenses, and approvals required to rehabilitate the portion (including appropriate environmental review), and a construction schedule satisfactory to Lender, and has complied with all reporting requirements set forth in this Agreement. E. There are no outstanding mechanics liens or stop notices related to the Property, and Borrower has furnished to Lender full waivers or releases of lien claims if required by Lender. F. Lender is satisfied that the financing for development of the Project for which Borrower has received funds or firm commitments for funds, are sufficient in Lender's reasonable determination to complete development of the Project and satisfy all of the covenants contained in the Loan Documents and the Regulatory Agreement. G. Borrower has submitted evidence reasonably satisfactory to Lender of firm rehabilitation and/or mortgage financing commitments. PROJECT DEVELOPMENT 9. DEVELOPMENT OBLIGATIONS. Borrower must develop the Project in accordance with the Plans and Specifications and that Project description attached as Exhibit D, as the Plans and Specifications and Project description may be modified pursuant to this Agreement. 10. CHANGES IN FINANCING. Borrower must promptly inform Lender of any changes in the amount, terms, or sources of financing or funding for the Project. 11. COMMENCEMENT OF REHABILITATION. Borrower must commence rehabilitation of the Project by the commencement date specified in the Schedule (the "Commencement Date"). For purposes of this Agreement, the date rehabilitation is commenced shall be considered the date that Borrower's contractor has begun substantial demolition or rehabilitation work on the Project. 12. COMPLETION OF REHABILITATION. Following commencement of rehabilitation, Borrower must diligently prosecute the rehabilitation of the Project to completion as evidenced by the issuance of a certificate of occupancy, or its substantial equivalent, such as the issuance of a notice of completion and final signed -off building permits, by the City of National City. Borrower must complete rehabilitation of the Project by that completion date specified in the Schedule (the "Completion Date"). 13. SCHEDULING AND EXTENSIONS OF TIME. Borrower is responsible for coordinating and scheduling the work to be performed so that commencement and completion of 6 Rehabilitation of the Project will take place in conformance with this Agreement. Lender may extend the time for commencement or completion in its sole discretion in writing if it determines that delay in the progress of work is not attributable to the negligence of Borrower and that such delay was due to causes beyond the control of Borrower. Any time extension granted to Borrower to enable Borrower to complete the work shall not constitute a waiver of any other rights Lender has under this Agreement. 14. CONSTRUCTION BONDS. Prior to commencement of rehabilitation of the Project, Borrower shall procure and deliver to Lender copies of a labor and material (payment) bond and a performance bond, or a dual bond which covers both payment and performance obligations, with respect to the rehabilitation of the Project in a penal sum each of not less than one hundred percent (100%) of the scheduled cost of rehabilitation. Such bonds must be issued by a company which is authorized to transact surety insurance in California and which has assets exceeding its liabilities in an amount equal to or in excess of the bond amount. The bonds shall name Lender as a co -obligee or assignee. Borrower shall record the payment bond with the San Diego County Recorder, and shall submit proof of recordation to Lender. In lieu of such bonds, a letter of credit in the sole name and possession of Lender in the penal amount and in a form acceptable to Lender may be substituted. 15. CONTRACTS AND SUBCONTRACTS. All rehabilitation work and professional services for the Project must be performed by persons or entities licensed or otherwise authorized to perform the applicable rehabilitation work or service in the State of California. Each contractor, subcontractor, and professional service provider doing work on the Project must have a current City of National City Business Tax Certificate, if required under local law. All contracts entered into for Project development must be the result of either competitive or negotiated bids. For negotiated bids, the contractor shall be selected through a competitive request for qualification process or other process reasonably satisfactory to Lender. Borrower represents that it has submitted to Lender copies of all construction, consultant and professional services contracts and subcontracts entered into to date for predevelopment or development work on the Project. As a precondition to closing the Loan, the general contractor for the Project (if a general construction contract for the Project has been executed), as well as any other construction contractors or subcontractors that might be designated by Lender, must execute a Construction Contract Addendum, a form of which is attached to this Agreement as Exhibit G. Borrower must submit to Lender all future professional services contracts and construction contracts for predevelopment or development work on the Project, as well as any amendments to said contracts. Lender shall have the right to review and approve any such contract or amendment prior to execution, if the maximum contract amount exceeds $5,000. As a precondition to approval, the general contractor, as well as any other construction contractors or subcontractors that might be designated by Lender, must execute a Construction Contract Addendum. Lender may also require that Borrower assign the benefits of a construction or consultant contract to Lender as a condition of approval. If Lender has not responded to a submission of a contract or amendment draft by Borrower within 15 business days of receipt by Lender, the contract or amendment shall be deemed approved by Lender. 16. ASSIGNMENT OF DEVELOPMENT RIGHTS. Subject to the rights of senior lienholders, and to the extent permitted by federal or state law, as additional security for the performance of Borrower's obligations under the Loan Documents, Borrower irrevocably assigns to Lender, and grants to Lender a security interest in, Borrower's interests in and rights to the following: all governmental permits, maps, and approvals it has obtained or will obtain for development of the Project; all construction contracts and subcontracts and all supply contracts and subcontracts now or 7 hereafter entered into for the Project; all contracts with architects, landscape architects, planners, geologists, surveyors, engineers, economists, or other development consultants now or hereafter entered into for the Project; all plans, specifications, drawings, data, and studies produced by these architects and development consultants; all private and governmental grants, subsidies, loans, and other financing for development of the Project, including any syndication proceeds, now or hereafter held by Borrower; and all reserves, deferred payments, deposits, refunds, cost savings, and payments relating to development of the Project. Borrower shall ensure that the third parties to the contracts referenced above for Project work consent to the assignment of these contracts to Lender. This assignment shall become effective upon an Event of Default that has not been cured in the manner and time provided herein and express written notice to Borrower thereafter that Lender intends to exercise the assignment. Lender shall not have any obligation under any assigned contracts or agreements until it expressly agrees in writing. Upon an Event of Default that has not been cured pursuant to this Agreement and notwithstanding any other provisions of the Loan Documents, Lender may use any of the foregoing assigned permits, contracts, agreements, plans, specifications, data, studies, funds, and accounts for any purpose for which Borrower could have used them under the Loan Documents or otherwise for development of the Project. Upon an Event of Default which has not been cured pursuant to this Agreement, Lender shall have the right, in its discretion, to enter upon and take possession of the Property, remove Borrower and its agents from the Property, and take any actions necessary in its judgment to complete development of the Project. This includes employing such contractors, subcontractors, agents, consultants, engineers, and architects as required to complete the rehabilitation, making changes in plans, specifications, work, or materials, entering into, modifying, or terminating any contractual arrangements, and/or using any funds or funding commitments held by Borrower, subject to Lender's right at any time to discontinue work without liability. If Lender elects to complete rehabilitation of the Project, Lender will not assume any liability to Borrower or to any other person for completing the Project, or for the manner or quality of rehabilitation of the Project, and Borrower expressly waives such liability. Borrower irrevocably appoints Lender as its attorney -in -fact, with full power of substitution, to complete the Project in Borrower's name, or Lender may elect to complete development in its own name, all effective upon an Event of Default and failure to cure. 17. PLANS AND SPECIFICATIONS. No later than the date set forth in the Schedule, Borrower must submit to Lender for its review and approval the Plans and Specifications. Borrower must develop the Project in conformance with the approved Plans and Specifications and any modifications authorized under this Agreement. Borrower understands and agrees that Lender approval of any Plans and Specifications pursuant to this section is approval only for purposes of administration of this Loan, and should not be considered in any way an issuance of a building permit or other permit, or any other approval required pursuant to the regulatory authority of the City. 18. QUALITY OF WORK. Borrower shall rehabilitate the Project in conformance with general industry standards and must employ building materials of a quality suitable for the requirements of the Project. Borrower shall develop the Project in full conformance with applicable local, state, and federal statutes, regulations, and building and housing codes. 8 19. CHANGES IN WORK. Borrower must obtain Lender's written approval of a written change order before any of the following changes, additions, or deletions in Project work may be performed: (1) any change that exceeds twenty-five thousand dollars ($25,000); or (2) any set of changes that cumulatively exceeds fifty thousand dollars ($50,000) or 10% of the Loan amount, whichever is less; or (3) any substantial change in building materials or equipment, specifications, or the architectural or structural design of the Project as called for in the Plans and Specifications. If Lender has not responded to a written request for a change order by Borrower within 8 City business days of receipt of such request by Lender, such request shall be deemed approved by Lender. Consent to any additions, changes, or deletions to the work shall not release Borrower from any other obligations in the Loan Documents, or release Borrower or its surety from any surety bond. 20. RECORDS. Borrower shall maintain records which fully and accurately show the date, amount, purpose, and payee of all expenditures for rehabilitation of the Project, and shall keep all estimates, invoices, receipts, and other documents related to Loan fund expenditures for at least five years after completion of rehabilitation of the Project as evidenced by the issuance of a Certificate of Satisfaction of Development Obligations. Borrower shall make records available for review by Lender's representatives. Records shall be kept accurate and up-to-date. Lender shall notify Borrower of any records it deems in its reasonable judgment to be insufficient. Borrower shall have 8 City business days from such notice to correct any specified deficiency in the records, or, if more than 8 City business days shall be reasonably necessary to correct the deficiency, Borrower shall begin to correct the deficiency within 8 City business days and correct the deficiency as soon as reasonably possible. 21. SITE INSPECTIONS. Borrower, through its staff or its development representative, shall permit and facilitate observation and inspection of work at the Project site by Lender's authorized representatives during normal business hours. 22. AUDITS. Borrower must make available at Borrower's or its development representative's office for examination at reasonable intervals and during normal business hours to Lender's representatives all books, accounts, reports, files, and other papers or property with respect to all matters covered by these Loan Documents, and shall permit these representatives to audit, examine, and make copies, excerpts or transcripts from such records. Lender's representatives may make audits of any conditions relating to this Loan. 23. PROJECT MONITORING AND EVALUATION. Borrower shall maintain and submit records to Lender within ten business days of Lender's request which clearly document Borrower's performance under each requirement of the Loan Documents. Borrower shall supply promptly, upon Lender's reasonable request, any information or documentation pertaining to the Project and must cooperate with Lender's representatives on matters related to Project monitoring and evaluation. Commencing upon completion of rehabilitation, Borrower shall pay to the Lender an annual monitoring fee ("Loan Monitoring Fee"), as determined by the Lender in schedules printed by the Lender from time to time. The Loan Monitoring Fee shall be subject to revision annually. The Loan Monitoring Fee shall be paid to the Lender annually within ten (10) days after the Lender provides a written invoice to Borrower for the same. Failure to timely pay the Loan Monitoring Fee shall constitute a material default under this Agreement and the Regulatory Agreement. The Loan Monitoring Fee shall be paid to the Lender as a consideration for the lending of funds by the Lender to the Borrower. 24. NO LENDER REVIEW RESPONSIBILITIES. Lender shall not be responsible for Borrower's conduct in connection with the Project, including, but not limited to, the quality and suitability of the Plans and Specifications, the supervision of the rehabilitation work, and the 9 qualifications, financial conditions, and performance of all architects, engineers, contractors, subcontractors, suppliers, consultants, and property managers. Lender is under no duty to review the Plans and Specifications or to inspect rehabilitation of the Project. Any review or inspection undertaken by Lender for the Project is solely for the purpose of determining whether Borrower is properly discharging its obligations to Lender, and should not be relied upon by Borrower or by any third parties, including homebuyers, as a warranty or representation by Lender as to the quality of the design or rehabilitation of the Project. 25. ENCUMBRANCE OF PROPERTY. Borrower may not engage in any financing or any other transaction creating any security interest or other encumbrance or lien upon the Property, whether by express agreement or operation of law, or allow any encumbrance or lien to be made on or placed on the Property prior to completion of Project development, except with the prior written consent of Lender or as otherwise specifically authorized under this Agreement. Borrower shall notify Lender in writing in advance of any financing secured by any deed of trust, mortgage, or other similar lien instrument that it proposes to enter into with respect to the Project or Property, or any encumbrance or lien that has been attached to the Property, whether voluntary or involuntary. Lender reserves the right to condition its consent to any other financing on the use of the proceeds of such financing to pay any loan fee due and unpaid to Lender in connection with this Loan. Notwithstanding the foregoing, Borrower shall have the right to refinance the senior loan in accordance with the terms of the Regulatory Agreement. 26. TRANSFER OF PROPERTY AND PROJECT. Borrower represents that it has not made, and agrees it shall not make or permit any sale, agreement to sell, assignment, conveyance, lease, further encumbrance, or other transfer of this Agreement or any part of the Project or the Property (except for the rental of Project Units to tenant households as set forth in the Regulatory Agreement), including the sale of any general or limited partnership interests, the removal of any general partner, or any substantial change in Project control (collectively referred to as "Transfers"), without the prior written consent of Lender in its sole discretion. Notwithstanding the foregoing, the following transactions are hereby deemed to be expressly permitted under the Loan Documents: (i) the transfer by the Limited Partners of their interests in the Borrower to any other entity which is affiliate of the Limited Partners or which is directly or indirectly controlled by WNC & Associates, Inc., or an affiliate thereof, (ii) a change in the beneficial ownership of the Limited Partners, so long as such entity remains directly or indirectly controlled by WNC & Associates, Inc., or an affiliate thereof or an affiliate thereof, (ii) the pledge and encumbrance of the interests of the Limited Partners to or for the benefit of any financial institution which enables the Limited Partners to make their capital contributions to Borrower, (iii) the removal of any general partner of the Borrower by Limited Partners pursuant to the terms of the Partnership Agreement and the admission of a replacement general partner acceptable to Lender in its reasonable discretion, (iv) issuance of partnership interests in Borrower equal to 99.99% of the profits, losses credits, distributions and other interest in Borrower to the Limited Partners of Borrower and (v) the transfer of limited partnership interests in Borrower to the General Partner or an affiliate thereof or the transfer of the Project to the General Partner or an affiliate thereof following the expiration of the tax credit compliance period. 27. PROJECT SYNDICATION. The Lender hereby approves the execution of the Partnership Agreement pursuant to which Limited Partners become the limited partners of the Borrower. The Project may not be further syndicated without the prior review by Lender of all documents governing the syndication and written consent by Lender to the terms of the syndication. For purposes of this section, "syndication" means the sale of equity shares or interests in the Property or 10 the Project to investors, including without limitation investors who are seeking low income housing tax credits or historic rehabilitation tax credits. In the event that Borrower intends to syndicate the Project, Borrower must submit to Lender at least 30 calendar days prior to syndication closing, for review and approval by Lender, a proposed syndication budget identifying the proposed uses of all syndication proceeds. Such uses may include direct Project development and operation costs, reasonable fees for structuring and marketing the syndication, and reasonable reserves as required by debt or equity financing sources or as otherwise approved by Lender. All net syndication proceeds, leveraged funds, and other money received by Borrower or an affiliate in connection with the Project which are not required to meet the financial obligations set forth in the Budget, the Partnership Agreement, or the approved syndication budget must be used to repay the Loan. Such funds shall be deposited with Lender within 30 days of receipt by Borrower or Borrower's affiliate. Lender reserves the right to earmark the use of any fee received by Borrower or Borrower's affiliate for the syndication as a condition of its consent to the syndication. 28. MECHANICS LIENS AND STOP NOTICES. If any claim of mechanics lien is filed against the Property or a stop notice affecting the Loan is served on Lender, Borrower shall, within 20 days of such filing or service, either pay and fully discharge the lien or stop notice, obtain an unconditional release of the lien or stop notice by recording a release bond, delivering to Lender a surety bond in sufficient form and amount, or provide Lender with other assurance reasonably satisfactory to Lender that the lien or stop notice will be paid or discharged. If Borrower fails to discharge any such lien, encumbrance, charge, or claim, then Lender may, but shall be under no obligation to, discharge the same at Borrower's expense. Alternatively, Lender may require Borrower to immediately deposit with Lender the amount necessary to satisfy such lien or claim and any costs, pending resolution thereof. Lender may use such deposit to satisfy any claim or lien that is adversely determined against Borrower. Borrower shall file a valid notice of cessation or notice of completion upon cessation of rehabilitation on the Project for a continuous period of 30 days or more, and shall take all other reasonable steps to forestall the assertion of claims of lien against the Property. Borrower authorizes Lender, but without any obligation, to record any notices of completion or cessation of labor, or any other notice that Lender deems necessary or desirable to protect its interest in the Project and Property; provided, however, that Lender shall exercise this right only if and when Borrower fails to take action as required. 29. DISABLED ACCESS. Borrower shall rehabilitate the Project and maintain the Property in compliance with all applicable federal, state, and local requirements for access for disabled persons. 30. LEAD -BASED PAINT. Borrower and its contractors and subcontractors shall not use lead -based paint in the rehabilitation of the Project or maintenance of Project Units. Borrower shall insert this provision in all contracts and subcontracts for work performed on the Project which involve the application of paint. Borrower shall ensure, from the date of completion through the date the affordability period terminates, that the Project is in compliance with the lead based paint provisions contained in the Lead -Based Paint Poisoning Act (42 USC Section 4821 et seq.), 24 CFR Part 35, and 24 CFR Section 982.401(j). Borrower shall be responsible for all testing and abatement activity. 31. CERTIFICATE OF SATISFACTION OF DEVELOPMENT OBLIGATIONS. Upon completion of rehabilitation of the Project, Borrower shall submit a certification from the Project architect stating that the improvements to the Property have been made in accordance with the Plans and Specifications. Upon (1) submission of this architect's certification, (2) a determination of final 11 Project costs, (3) a determination by Lender that Borrower has completed the Project in conformance with industry standards and the Plans and Specifications, (4) a determination by Lender in Lender's reasonable judgment that Borrower has satisfied all of Borrower's development obligations under this Agreement, and (5) completion of a cost certification of the Project signed under penalty of perjury, Lender shall furnish Borrower, within 15 calendar days of a written request by Borrower, with a Certificate of Satisfaction of Development Obligations for the full Project or the applicable phase of the Project. If Lender determines that issuance of said Certificate is unwarranted, it shall provide Borrower with a written statement within the above time frame indicating in what respects Borrower is deficient, and what measures Borrower will need to take or what standards it will need to meet in order to obtain the Certificate. If Borrower subsequently takes the specified measures or meets the specified standards, and is not otherwise in default under the Loan Documents, Lender shall then deliver a Certificate to Borrower. 32. OPERATION OF PROJECT. Borrower and its agents shall diligently operate and manage Project Units after Project completion in full conformance with the covenants contained in the Regulatory Agreement, which are intended to run with the land and bind all successors -in -interest to the Property for the full term of the Regulatory Agreement, and with the terms of the Final Management Plan as defined in the Regulatory Agreement. 33. NONDISCRIMINATION. Borrower may not discriminate or segregate in the use, enjoyment, occupancy, conveyance, lease, sublease, or rental of any part of the Property on the basis of race, color, ancestry, national origin, religion, sex, sexual preference, age, marital status, family status, source of income, physical or mental disability, Acquired Immune Deficiency Syndrome (AIDS) or AIDS -related conditions, or any other arbitrary basis. Borrower must otherwise comply with all applicable local, state and federal fair housing laws. Specifically, Borrower must ensure that the Project is conducted and administered in conformance with Title VI of the federal Civil Rights Act of 1964 and the federal Fair Housing Act, and implementing regulations. 34. FEES, TAXES, AND OTHER LEVIES. Borrower is responsible for payment of all fees, assessments, taxes, charges, liens and levies imposed by any public authority or utility company with respect to the Property or the Project, and shall pay such charges prior to delinquency. However, Borrower shall not be required to discharge any such charge so long as (a) the legality thereof is being contested in good faith and by appropriate proceedings, and (b) Borrower maintains reserves adequate to pay any contested liabilities. 35. DAMAGE TO PROPERTY. If any building or improvements erected by Borrower on the Property is extensively damaged or destroyed, and the cost of restoring the building or improvements is covered by insurance proceeds, Borrower must, at its own cost and expense, repair or restore said buildings and improvements consistent with the original Plans and Specifications (for purposes hereof, a loss shall be considered "covered by insurance proceeds" notwithstanding any policy deductible or self -insured retention). Such work must be commenced within 180 days after the damage or loss occurs and shall be complete within one year thereafter. All insurance proceeds collected for such damage or destruction and other funds available to Borrower shall be applied to the cost of such repairs or restoration. 36. RELOCATION. The parties anticipate that any relocation of tenants will be of a temporary nature. To the extent that acquisition or rehabilitation of the Property results in the permanent or temporary displacement of residential tenants, homeowners, or businesses, then Borrower shall comply with all applicable local, state, and federal statutes and regulations with respect to relocation planning, advisory assistance, and payment of monetary benefits, including: the Uniform 12 Relocation Assistance and Real Property Acquisition Policies Act of 1970 (42 U.S.C. Section 4601, et seq.), and implementing regulations at 49 C.F.R. Part 24; Section 104(d) of the Housing and Community Development Act of 1974 and implementing regulations at 24 C.F.R. Part 42; 24 C.F.R. Section 570.606; and California Government Code Section 7260 et seq. and implementing regulations at 25 California Code of Regulations Section 6000 et seq. Borrower shall be solely responsible for payment of any relocation benefits to any displaced persons and any other obligations associated with complying with such relocation laws. Borrower shall indemnify, defend (with counsel reasonably chosen by Lender), and hold harmless Lender against all claims which arise out of relocation obligations to residential tenants, homeowners, or businesses permanently or temporarily displaced by the acquisition or rehabilitation of the Property. EMPLOYMENT AND CONTRACTING 37. NONDISCRIMINATION. Borrower may not discriminate against any employee or applicant for employment on the basis of race, color, religion, sex, sexual preference, national origin, AIDS or AIDS -related conditions, or disability in any phase of employment during rehabilitation. Borrower agrees to post in conspicuous places available to all employees and applicants for employment, notices to be provided setting forth the provisions of this nondiscrimination clause. 38. COMPLIANCE WITH LAWS. Borrower shall carry out the design, rehabilitation and operation of the Project in conformity with all applicable laws, including all applicable state labor standards; the Lender zoning and development standards, building, plumbing, mechanical and electrical codes, and all other provisions of the Lender's Municipal Code, and all applicable disabled and handicapped access requirements, including without limitation the Americans With Disabilities Act, 42 U.S.C. Section 12101, et seq., Government Code Section 4450, et seq., Government Code Section 11135, et seq., the Unruh Civil Rights Act, Civil Code Section 51, et seq., and the California Building Standards Code, Health and Safety Code Section 18900, et seq. 39. REPORTING. Borrower must submit annually, no later than June 30th, of each year during the term of this Agreement, for the calendar year ending the immediately previous December 31 s`, with such records and reports as are required and are requested by the Lender. The records and reports include (to the extent applicable), but are not limited to the following: Eligible tenant information, including yearly income verifications; Information on rents and occupancy of the Project Units; On -site inspection results; Insurance policies and notices; Equal Employment Opportunity and Fair Housing records; Labor costs and records; (7) Audited income and expense statement, balance sheet and statement of cash flows for Borrower; 13 (8) A Management Plan for the calendar year in which the report is prepared showing anticipated rental income, other income, expenses, anticipated repairs and replacements to the Project, timing of such repairs and replacements, insurance maintained on behalf of the Project, and such other matters as Lender shall require, in the Lender's sole discretion; (9) Federal and State income tax returns for the calendar year, ending on the preceding December 31 st; (10) Annual budget of reserves for repair and replacement; (11) Annual certification and representation regarding status of all loans, encumbrances and taxes; (12) Annual statement regarding condition of the Property disclosing any known defects; (13) Available Cash Flow computation on the approved Lender form; (14) A report or reports, certifying compliance with the terms and provisions of the Section 3 requirements; and (15) Such other and further information and records as the Lender shall request in writing from Borrower. Time is of the essence in supplying each and every report required to be supplied to Lender. The parties agree that a fee of $25.00 per day shall be paid by Borrower to Lender for each day that each report is delinquent. The parties agree that multiple fees may be charged at any one time, depending upon the number of reports and/or information that is delinquent. The parties agree that a fee of $25.00 per day, per report and/or information is a reasonable estimation of the damages that will accrue to Lender as a result of the failure of Borrower to timely submit the required information and/or reports and that said fees shall be treated as liquidated damages by the parties, in anticipation of the damages that will be incurred by Lender as a result of a breach by Borrower. The parties further agree that it would be difficult, if not impossible, to determine the exact actual amount of damages suffered by Lender in the event of a breach by Borrower in the reporting requirements of this Agreement. Notwithstanding the foregoing or anything to the contrary contained herein, Lender shall give Borrower prior written notice of any report and/or information that Borrower has failed to provide Lender and Borrower shall have thirty (30) days to provide such report and/or information to Lender prior to the assessment of any liquidated damages. 14 INDEMNITY AND INSURANCE 40. INSURANCE COVERAGE. Borrower must have or cause to have in full force and effect the insurance coverage specified in Exhibit I to this Agreement. In addition, Borrower shall ensure that the general contractor for the Project maintains the insurance coverage specified in Exhibit I for the duration of Project rehabilitation. 41. INSURANCE ADVANCES. In the event Borrower fails to maintain the full insurance coverage required by this Agreement, Lender, after at least seven business days prior written notice to Borrower, may, but shall be under no obligation to, take out the required insurance policies and/or pay the premiums on such policies. Any amount advanced by Lender, together with interest from the date of such advance at the same rate of interest specified in the Note (unless payment of such an interest rate would be contrary to applicable law, in which case interest shall accrue at the highest rate then allowed by applicable law), shall become payable by Borrower to Lender, subject to all the terms and conditions of this Agreement, and shall be secured by the Deed of Trust. 42. TITLE AND TITLE INSURANCE. Borrower warrants that it shall obtain fee simple absolute title to the Property in a good and marketable condition concurrently with closing. As a condition of the Loan, Borrower shall obtain at Borrower's sole expense an ALTA Loan Policy of title insurance insuring Lender, with liability not less than the principal amount of the Loan, issued by an insurer satisfactory to Lender, excepting only such defects, liens, encumbrances, and exceptions as are reasonably approved by Lender, and containing such endorsements as Lender may require. 43. NON -LIABILITY OF OFFICIALS, EMPLOYEES AND AGENTS. No member, official, officer, director, employee, or agent of the Lender or the City shall be personally liable to Borrower for any obligation created under the terms of these Loan Documents except in the case of actual fraud or willful misconduct by such person. 44. INDEMNITY. Notwithstanding the insurance coverage required herein, Borrower hereby indemnifies and holds the Lender, the City, its members, officials, officers, directors, employees, and agents (collectively, the "Indemnified Parties") harmless from any losses, damages, liabilities, claims, demands, judgments, actions, court costs, and legal or other expenses (including reasonable attorneys' fees) which an Indemnified Party may incur as a result of (1) the making of this Loan to Borrower (other than losses resulting from a finding that the Loan is illegal or unauthorized); (2) Borrower's failure to perform any of its obligations as and when required by the Loan Documents; (3) a failure of any of Borrower's representations or warranties to be true and complete in any material respect; or (4) any act or omission by Borrower or any contractor, subcontractor, architect, engineer, consultant or supplier with respect to the Project or the Property, except to the extent that the loss is caused by the negligence or willful misconduct of the Indemnified Party. Borrower shall pay immediately upon the Indemnified Party's demand any amounts owing under this indemnity provision. The duty of Borrower to indemnify includes the duty to defend the Indemnified Party in any court action, administrative action, or other proceeding brought by any third party arising from the Project or the Property with counsel reasonably acceptable to the Indemnified Party. Borrower's duty to indemnify the Indemnified Parties shall survive the term of the Loan and the reconveyance of the Deed of Trust. 15 HAZARDOUS MATERIALS 45. REPRESENTATIONS AND WARRANTIES. After reasonable investigation and inquiry, Borrower represents and warrants to the best of its knowledge, as of the date of this Agreement and except as previously disclosed to and acknowledged in writing by Lender or as disclosed in connection with the NEPA approval of the Project, based on environmental audit(s) performed on the Property, that (a) the Property are not and have not been a site for the use, generation, manufacture, transportation, storage, or disposal of Hazardous Materials; (b) the Property are in compliance with all Hazardous Materials Laws; (c) there are no claims or actions pending or threatened with respect to the Property by any governmental entity or agency or any other person relating to Hazardous Materials; and (d) there has been no release or threatened release of any Hazardous Materials on, under, or near the Property (including in the soil, surface water, or groundwater under the Property) or any other occurrences or conditions on the Property or on any other real property that could cause any part of the Property to be classified as a "hazardous waste property" or as a "border zone property" under California Health and Safety Code Sections 25220, et seq., or regulations adopted therewith. 46. NOTIFICATION TO LENDER. Borrower shall immediately notify Lender in writing of: (a) the discovery of any concentration or amount of Hazardous Materials on or under the Property requiring notice to be given to any governmental agency under Hazardous Materials Laws; (b) any knowledge by Borrower that the Property does not comply with any Hazardous Materials Laws; (c) the receipt by Borrower of written notice of any Hazardous Materials claims; and (d) the discovery by Borrower of any occurrence or condition on the Property or on any real property located within 2,000 feet of the Property that could cause any part of the Property to be designated as a "hazardous waste property" or as a "border zone property" under California Health and Safety Code Sections 25220, et seq., or regulations adopted therewith. 47. USE AND OPERATION OF PROPERTY. Neither Borrower, nor any agent, employee, or contractor of Borrower, nor any authorized user of the Property may use the Property or allow the Property to be used for the generation, manufacture, storage, disposal, or release of Hazardous Materials. Borrower must comply and cause the Project to comply with Hazardous Materials Laws not more than 30 days after Borrower's receipt of written notice by Lender to do so. 48. REMEDIAL ACTIONS. If Borrower has actual knowledge of the presence of any Hazardous Materials on or under the Property, Borrower shall immediately take at no cost to Lender, all handling, treatment, removal, storage, decontamination, cleanup, transport, disposal or other remedial action required by Hazardous Materials Laws or by any orders or requests of any governmental agency or any judgment, consent decree, settlement or compromise with respect to any Hazardous Materials claims. The foregoing shall be subject to Borrower's right of contest below. 49. RIGHT OF CONTEST. Borrower may contest in good faith any claim, demand, levy or assessment under Hazardous Materials Laws if: (a) the contest is based on a material question of law or fact raised by Borrower in good faith, (b) Borrower promptly commences and thereafter diligently pursues the contest, (c) the contest will not materially impair the taking of any remedial action with respect to such claim, demand, levy or assessment, and (d) Borrower demonstrates to Lender's reasonable satisfaction that Borrower has the financial capability to undertake and pay for such contest and any remedial action then reasonably necessary. No Event of Default shall be deemed to exist with respect to any claim, demand, levy or attachment being contested by Borrower under this section. 16 50. ENVIRONMENTAL INDEMNITY. Borrower shall defend, indemnify, and hold Lender, its members, officials, directors, employees or agents, harmless against any claims, demands, administrative actions, litigation, liabilities, losses, damages, response costs, and penalties, including costs of legal proceedings and attorney's fees, that Lender may incur as a result of any inaccuracy or breach of any representation, warranty, agreement, or covenant contained in this Agreement with respect to Hazardous Materials, or as a consequence of any use, generation, manufacture, storage, release, or disposal (whether or not Borrower knew of same) of any Hazardous Materials occurring as a result of Borrower's use or occupancy of the Property. DEFAULT AND REMEDIES 51. EVENTS OF DEFAULT BY BORROWER. The occurrence of any of the following events shall be an "Event of Default" by Borrower under this Agreement: A. Monetary. (1) Borrower's failure to pay when due any sums payable under the Loan Documents, including failure to reimburse Lender for any advances made by Lender under this Agreement or the Deed of Trust; (2) Borrower's use of Loan funds for costs other than Eligible Costs or for uses inconsistent with other terms and restrictions in the Loan Documents; (3) Borrower's failure to obtain and maintain the insurance coverage required under this Agreement; (4) Borrower's failure to make any other payment or assessment due under the Loan Documents; or (5) the disbursement, release, hypothecation or encumbrance of all or any portion of the Loan Funding Reserve without the written consent of the Lender; B. Rehabilitation. (1) Any changes in the work of rehabilitation specified in the approved Plans and Specifications without Lender's prior written consent if such consent is required under this Agreement; (2) Borrower's use of defective or unauthorized materials or defective workmanship in rehabilitating the Project; (3) Borrower's failure to commence or complete Project rehabilitation, without proper justification under the enforced delay provision of this Agreement, according to the Commencement Date and Completion Date specified in this Agreement; (4) a substantial cessation of rehabilitation prior to Project completion for a period of more than 30 continuous calendar days; (5) the filing of any claim of lien against the Property or service on Lender of any stop notice relating to the Loan, and the continuance of the claim of lien or stop notice for 20 days after such filing or service without payment, discharge, or satisfaction as provided for in this Agreement; (6) Borrower's failure to remedy any material deficiencies in recordkeeping or failure to provide records to Lender upon Lender's request; or (7) Borrower's failure to substantially comply with any federal, state, or local laws or Lender policies governing rehabilitation, including but not limited to provisions of this Agreement pertaining to Project employment, disabled access, lead paint, and Hazardous Materials; C. Operation. (1) Rental of Project Units to households whose incomes do not qualify them for occupancy, or any failure of Borrower or Borrower's agent to take adequate steps to certify incomes; (2) overcharging in rental of Project Units by Borrower or Borrower's agent; (3) Borrower's or Borrower's agent's failure to comply with the Regulatory Agreement or the Final Management Plan as defined in the Regulatory Agreement; (4) discrimination by Borrower or Borrower's agent on the basis of characteristics prohibited by this Agreement or applicable law; (5) the imposition of any encumbrances or liens on the Property without Lender's prior written approval, except as otherwise allowed under this Agreement, or that have the effect of reducing the priority of or invalidating the Deed 17 of Trust; (6) except as set forth in Section 26, the Transfer of the Property, the Project, or this Agreement or the assignment of any interest in any of the Loan Documents or the Regulatory Agreement (whether by assignment or novation) without Lender's prior written consent; (7) conversion of Project Units to condominium or cooperative ownership without Lender's prior written consent and except as otherwise permitted under this Agreement; (8) Borrower's or Borrower's agent's failure to substantially comply with any federal, state, or local laws or Lender policies governing the operation and management of housing, including without limitation provisions of this Agreement and the Regulatory Agreement pertaining to maintenance and security, disabled access, lead paint, Hazardous Materials, conflicts of interest, and political activities; or (9) except to effectuate transferes permitted pursuant to Section 26 and or make ministerial changes or other modifications that will not adversely impact the Lender to the Borrower's obligations hereunder, the amendment, modification, restatement, revocation or rescission of the Borrower's LP-1 or the Partnership Agreement; D. General performance of Debt obligations. Any failure to perform, in a timely manner, any agreement or covenant of the Borrower under any of the Loan Documents, the Regulatory Agreement or any notes, loans and deeds of trust that are senior and/or junior to the Deed of Trust, subject to all applicable notice and cure periods; E. General performance of other obligations. Any breach by Borrower or Borrower's agents of any material obligations of Borrower imposed by any other agreements with respect to the financing, development, or operation of the Project or the Property, whether or not Lender is a party to such agreement; F. Representations and warranties. A determination by Lender in its reasonable judgment that any of Borrower's representations or warranties made in the Loan Documents, any statements made to Lender by Borrower, or any certificates, documents, or schedules supplied to Lender by Borrower were untrue in any material respect when made, or that Borrower concealed or failed to disclose a material fact from Lender; G. Damage to Property. Material damage or destruction to the Property, if Borrower does not take steps to reconstruct the Property as required herein; H. Bankruptcy, dissolution, and insolvency. Borrower's or Borrower's general partner's (1) filing for bankruptcy, dissolution, or reorganization, or failure to obtain a full dismissal of any involuntary filing brought by another party under bankruptcy or similar laws before the earlier of final relief or 60 days after filing; (2) making a general assignment for the benefit of creditors; (3) applying for the appointment of a receiver, trustee, custodian, or liquidator, or failure to obtain a full dismissal of any such involuntary application brought by another party before the earlier of final relief or 60 days after the filing; (4) insolvency; or (5) failure, inability or admission in writing of its inability to pay its debts as they become due. 52. NOTICE OF BORROWER'S DEFAULT AND OPPORTUNITY TO CURE. Lender shall give written notice to Borrower and the Limited Partners of any Event of Default on the part of Borrower. Said notice shall specify the nature of the act, omission, or deficiency giving rise to the Event of Default. In addition, if the Event of Default is curable, does not pertain to a failure to comply with the Commencement Date and/or the Completion Date, and does not give rise to an imminent danger to health or safety, then the notice shall also specify the action required to cure the 18 default. If the default is not cured within 30 calendar days or the Borrower does not commence such cure within 30 calendar days and diligently pursue the cure to completion within a reasonable time thereafter, the Lender may proceed with all of its rights and remedies under the terms of the Loan Documents, Regulatory Agreement or at law. Limited Partners shall have the same cure rights as the Borrower hereunder. 53. LENDER'S REMEDIES. Upon any uncured Event of Default as provided for above, Lender may, in addition to other rights and remedies permitted by the Loan Documents, Regulatory Agreement or applicable law, proceed with any or all of the following remedies in any order or combination Lender may choose in its sole discretion: B. Bring an action for equitable relief (1) seeking the specific performance by Borrower of the terms and conditions of the Loan Documents, and/or (2) enjoining, abating, or preventing any violation of said terms and conditions, and/or (3) seeking declaratory relief; C. Accelerate the Loan, and demand immediate full payment of the principal amount outstanding and all accrued interest under the Note, as well as any other funds advanced to Borrower by Lender under the Loan Documents, including reasonable administrative costs, immediately due and payable; D. Enter the Property and take any actions necessary in its reasonable judgment to complete Project rehabilitation as permitted under this Agreement, including without limitation (1) making changes in the Plans and Specifications or other work or materials for the Project, (2) entering into, modifying, or terminating any contractual arrangements (subject to Lender's right at any time to discontinue work without liability), or (3) taking any remedial actions with respect to Hazardous Materials that Lender reasonably deems necessary to comply with Hazardous Materials Laws or to render the Property suitable for occupancy; E. Seek appointment from a court of competent jurisdiction of a receiver with the authority to complete rehabilitation as needed to preserve Lender's interest in seeing the Project developed in a timely manner, including the authority to take any remedial actions with respect to Hazardous Materials that Lender or the receiver deems necessary to comply with Hazardous Materials Laws or to render the Property suitable for occupancy; F. Order immediate stoppage of rehabilitation and demand that any condition leading to the Event of Default be corrected before rehabilitation may continue; G. Enter upon, take possession of, and manage the Property, either in person, by agent, or by a receiver appointed by a court, and collect rents and other amounts specified in the assignment of rents in the Deed of Trust and apply them to operate the Property or to pay off the Loan or any advances made under the Loan Documents, as provided for in the Deed of Trust; H. Initiate and pursue any private and/or judicial foreclosure action allowed under applicable law and the power of sale provision in the Deed of Trust; 19 I. With respect to defaults under Hazardous Materials provisions herein, pursue the rights and remedies permitted under California Civil Code Section 2929.5, and California Code of Civil Procedure Sections 564, 726.5, and 736; or J. Pursue any other remedy allowed at law or in equity. 54. LENDER'S DEFAULT AND BORROWER'S REMEDIES. Borrower shall give written notice to Lender of any Event of Default on the part of Lender. Said notice shall specify the nature of the act, omission, or deficiency giving rise to the Event of Default. In addition, if the Event of Default is curable and does not give rise to an imminent danger to health or safety, the notice shall also specify the action required to cure the default, and a reasonable date, which shall not be less than 30 calendar days from the mailing of the notice, by which Lender must take or commence such action to cure. If the notice specifies only a commencement date for the cure, Lender shall commence such cure within the specified time and shall diligently pursue the cure to completion within a reasonable time thereafter. Upon such notice and the failure of Lender to cure such default or commence the cure, Borrower may: A. Demand payment from Lender of any sums due Borrower; B. Bring an action for equitable relief seeking the specific performance by Lender of the terms and conditions of the Loan Documents; or C. Pursue any other remedy allowed at law or in equity. GENERAL PROVISIONS 55. BORROWER'S WARRANTIES. Borrower represents and warrants: (1) that it has access to professional advice and support to the extent necessary to enable Borrower to fully comply with the terms of the Loan Documents and Regulatory Agreement and otherwise carry out the Project; (2) that it is duly organized, validly existing and in good standing under the laws of the State of California; (3) that it has the full power and authority to undertake the Project and accept the Loan; (4) that there are no pending, or to the best of Borrower's knowledge, threatened actions or proceedings before any court or administrative agency which may substantially affect the financial condition or operation of Borrower, other than those already disclosed to Lender; (5) that the persons executing and delivering the Loan Documents and Regulatory Agreement are authorized to execute and deliver such documents on behalf of Borrower; and (6) Borrower shall comply with the Regulatory Agreement at all times during the term of the Regulatory Agreement. 56. SUBORDINATION. Lender hereby acknowledges and agrees that the Regulatory Agreement and the Deed of Trust shall be subordinate to the lien and encumbrance recorded concurrently against the Property of the deed of trust executed by Borrower in favor of the California Municipal Finance Authority to secure a loan in the maximum principal amount of $16,000,000.00. 57. LITIGATION. Borrower must promptly give notice in writing to Lender of any litigation pending or threatened against Borrower in which the amount claimed is in excess of fifty thousand dollars ($50,000). 58. CONFLICTS OF INTEREST. Borrower warrants and represents, to the best of its present knowledge, that no public official of Lender who has been involved in the making of this Loan 20 or this Agreement, or who is a member of a Lender board or commission which has been involved in the making of this Loan or this Agreement, has or will receive a direct or indirect financial interest in this Loan or the Project in violation of the rules contained in California Government Code Section 1090, et seq., pertaining to conflicts of interest in public contracting. Borrower shall exercise due diligence to ensure that no such official will receive such an interest. If Borrower, a general partner of Borrower, or an affiliate of Borrower or Borrower's general partner is a nonprofit corporation, Borrower warrants and represents, to the best of its present knowledge, that any such public official of Lender who is an employee or a noncompensated director or officer of said nonprofit corporation has disqualified himself or herself from participating in Lender's decision to make this Loan or Agreement. Borrower further warrants and represents, to the best of its present knowledge and excepting any written disclosures as to these matter already made by Borrower to Lender, that (1) no public official of Lender who has participated in decisionmaking concerning this Loan or the Project or has used his or her official position to influence decisions regarding this Loan or the Project, has an economic interest in Borrower or the Project, and (2) neither the Project nor the Loan will have a direct or indirect financial effect on said official, the official's spouse or dependent children, or any of the official's economic interests. Borrower agrees to promptly disclose to Lender in writing any information it may receive concerning any such potential conflict of interest. Borrower's attention is directed to the conflict of interest rules applicable to governmental decisionmaking contained in the Political Reform Act (California Government Code Section 87100, et seq.) and its implementing regulations (California Code of Regulations, Title 2, Section 18700, et seq.). No compensated employee, independent contractor, consultant, proprietor, or owner of Borrower, any general partner or joint venture partner of Borrower, or any affiliate of Borrower or Borrower's partners, may rent, lease, purchase, or occupy any Project Unit, if said person has been or is in a decisionmaking role with respect to the Project. The prohibition in this paragraph extends to the spouses and dependent children of such persons. Borrower shall exercise due diligence to ensure that no Loan proceeds are used in any self - dealing transaction, within the meaning of the California Corporations Code, involving a material financial interest of a director of (1) Borrower, (2) a general partner of Borrower, or (3) an affiliate of Borrower or Borrower's general partner; unless such transaction is expressly permitted or considered valid under the Corporations Code. 59. POLITICAL ACTIVITY. None of the funds, materials, property, or services contributed by Lender or Borrower under the Loan Documents may be used for any political activity or the election or defeat of any candidate for public office. 60. PUBLICITY. Any publicity generated by Borrower for the Project must make reference to the contribution of Lender in making the Project possible. Lender's name shall be prominently displayed in all pieces of publicity generated by Borrower, including flyers, press releases, posters, signs, brochures, and public service announcements. Lender's staff will be available whenever possible at the request of Borrower to assist Borrower in generating publicity for the Project. Borrower agrees to. cooperate with Lender in any Lender -generated publicity or promotional activities with respect to the Project. 61. TERM OF THIS AGREEMENT. This Agreement shall commence on the date first set forth above and remain in full force and effect throughout the term of this Loan, except as may be otherwise specified. 21 62. UNAVOIDABLE DELAY IN PERFORMANCE. The time for performance of provisions of this Agreement by either party shall be extended for a period equal to the period of any delay directly affecting the Project or this Agreement which is caused by: war; insurrection; strikes; lock -outs; riots; floods; earthquakes; fires; casualties; acts of God; acts of a public enemy; epidemics; quarantine restrictions; freight embargoes; lack of transportation; suits filed by third parties concerning or arising out of this Agreement; or unseasonable weather conditions. An extension of time for any of the above -specified causes will be deemed granted only if written notice by the party claiming such extension is sent to the other party within ten calendar days from the commencement of the cause. In any event, rehabilitation of the Project must be completed no later than 90 calendar days after the scheduled Completion Date specified herein, any unavoidable delay notwithstanding. Times of performance under this Agreement may also be extended for any cause for any period of time by the mutual written agreement of Lender and Borrower. 63. GOVERNING LAW. This Agreement shall be interpreted under and be governed by the laws of the State of California, except for those provisions relating to choice of law or those provisions preempted by federal law. 64. STATUTORY REFERENCES. All references in the Loan Documents to particular statutes, regulations, ordinances, or resolutions of the United States, the State of California, or the City of National City shall be deemed to include the same statute, regulation, ordinance, or resolution as hereafter amended or renumbered, or if repealed, to such other provisions as may thereafter govern the same subject. 65. ATTORNEYS' FEES AND COSTS. In the event any legal or administrative action is brought to interpret or enforce the terms of this Agreement, the prevailing party shall be entitled to recover all reasonable attorneys' fees and costs incurred in such action. 66. TIME. Time is of the essence in the performance of this Agreement by Lender and Borrower. 67. CONSENTS AND APPROVALS. Any consent or approval required under this Loan Agreement may not be unreasonably withheld, delayed, or conditioned. 68. NOTICES, DEMANDS AND COMMUNICATIONS. Formal notices, demands and communications between Borrower and Lender shall be given by registered or certified mail, postage prepaid, return receipt requested, or by overnight mail, or shall be delivered personally, to the principal offices of Borrower and Lender as follows, or if any such office is relocated, to the new address specified by the relocated party: LENDER: Community Development Commission -Housing Authority of the City of National City 140 East 12th Street National City, CA 91950-3312 Attn: Executive Director BORROWER: Vista Del Sol Apartments, L.P. 9421 Haven Avenue Rancho Cucamonga, CA 91730 22 With a copy to: Gubb & Barshay LLP 505 14th Street, Suite 450 Oakland, CA 94612 Attention: Scott Barshay, Esq. With a copy to: WNC California Holding, LLC c/o WNC & Associates, Inc. 17782 Sky Park Circle Irvine, CA 92614-6404 Attention: Michael J. Gaber With a copy to: Holland & Knight LLP 10 St. James Avenue, 11t Floor Boston, MA 02116 Attention: Jonathan I. Sirois, Esq. 69. BINDING UPON SUCCESSORS. All provisions of these Loan Documents are binding upon and inure to the benefit of the heirs, administrators, executors, successors -in -interest, transferees, and assigns of each of the parties; provided, however, that this section does not waive the prohibition on assignment of this Agreement by Borrower without Lender's consent. The term "Borrower" as used in these Loan Documents includes all assigns, successors -in -interest, and transferees of Borrower. 70. RELATIONSHIP OF PARTIES. The relationship of Borrower and Lender is solely that of a debtor and a creditor, and should not be construed as a joint venture, equity venture, partnership, or any other relationship. Lender does not undertake or assume any responsibility or duty to Borrower (except as provided for herein) or to any third party with respect to the Project, the Property, or the Loan. Except as Lender may specify in writing, Borrower has no authority to act as an agent of Lender or to bind Lender to any obligation. 71. ASSIGNMENT AND ASSUMPTION. Borrower may not assign any of its interests under this Agreement or other Loan Documents to any other party, except as specifically permitted under the terms of this Agreement or the other Loan Documents, without the prior written consent of Lender. Any unauthorized assignment shall be void. 72. WAIVER. Any waiver by Lender of an obligation in these Loan Documents must be in writing and must be executed by an authorized agent of Lender. No waiver should be implied from any delay or failure by Lender to take action on any breach or Event of Default of Borrower or to pursue any remedy allowed under the Loan Documents or applicable law. Any extension of time granted to Borrower to perform any obligation under the Loan Documents will not operate as a waiver or release from any of its obligations under the Loan Documents. Consent by Lender to any act or omission by Borrower should not be construed to be a consent to any other act or omission or to waive the requirement for Lender's written consent to future waivers. 73. INTEGRATION. The Loan Documents and the Regulatory Agreement contain the entire agreement of the parties with respect to the Loan, and supersede any prior negotiations. All prior or contemporaneous agreements, understandings, representations, and statements are merged into these Loan Documents and are of no further force or effect. 74. OTHER AGREEMENTS. Borrower represents that it has not entered into any agreements that are inconsistent with the terms of the Loan Documents. Borrower may not enter into 23 any agreements that are inconsistent with the terms of the Loan Documents without an express written waiver by Lender. 75. AMENDMENTS AND MODIFICATIONS. Any amendments or modifications to this Agreement must be in writing, and will be effective only if executed by both Borrower and Lender. 76. SEVERABILITY. Every provision of this Agreement is intended to be severable. If any provision of this Agreement is held invalid, illegal, or unenforceable by a court of competent jurisdiction, the validity, legality, and enforceability of the remaining provisions shall not be affected or impaired. 77. EXHIBITS. The following Exhibits are attached to this Agreement and are hereby incorporated into this Agreement by reference: Exhibit A: Property Description Exhibit B: Budget Exhibit C: Eligible Costs Exhibit D: Project Description Exhibit E: Schedule Exhibit F: Form of Construction Contract Addendum Exhibit G: Insurance Requirements 78. COUNTERPARTS. This Agreement may be signed in multiple counterparts, which, when signed by all parties, will constitute a binding agreement. [SIGNATURE BLOCKS ON NEXT PAGE] 24 IN WITNESS WHEREOF, the undersigned parties have executed this Loan Agreement, effective as of the date first written above. "BORROWER" VISTA DEL SOL APARTMENTS, L.P., a California limited partnership By: Vista Del Sol GP LLC, a California limited liability company, its general partner By: National Community Renaissance of California, a California nonprofit public benefit corporation, its managin mFmber By: Its: [SIGNATURES CONTINUED ON FOLLOWING PAGE] 25 "LENDER" THE COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY, a public body corporate and politic By: Its: Executive Director Approved as to form: By: -.%1‘44 eputy City Attorney LOAN AGREEMENT (Vista Del Sol Apartments) EXHIBIT A PROPERTY DESCRIPTION (attached) 27 EXHIBIT A PROPERTY DESCRIPTION THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS: PARCEL 1: THE NORTHERLY 52.40 FEET OF THE SOUTHERLY 217.40 FEET OF THE WESTERLY HALF OF THE SOUTHERLY HALF OF THE WESTERLY HALF OF THE SOUTHWEST QUARTER OF QUARTER SECTION 129 OF RANCHO DE LA NACION, ACCORDING TO MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, MAY 11, 1869. EXCEPTING THEREFROM THE WESTERLY 185.00 FEET AND ALSO EXCEPTING THEREFROM THE EASTERLY 30.00 FEET. APN(s): 557-440-50 PARCEL 2: THE NORTHERLY 52.45 FEET OF THE SOUTHERLY 269.85 FEET OF THE WESTERLY ONE-HALF OF THE SOUTHERLY ONE-HALF OF THE WESTERLY ONE-HALF OF THE SOUTHWESTERLY QUARTER OF SECTION 129 OF RANCHO DE LA NACION, ACCORDING TO MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY. EXCEPTING THEREFROM THE WESTERLY 185.00 FEET; ALSO EXCEPTING THEREFROM THE EASTERLY 30.00 FEET. APN(s): 557-440-49 PARCEL 3: ALL OF THE WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWEST QUARTER OF QUARTER SECTION 129, RANCHO DE LA NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. EXCEPTING THEREFROM THE NORTH 273.00 FEET THEREOF. ALSO EXCEPTING THEREFROM THE SOUTH 323.85 FEET THEREOF. A-1 ALSO EXCEPTING THEREFROM THE WESTERLY 144.00 FEET THEREOF. ALSO EXCEPTING THEREFROM THE EASTERLY 30.00 FEET THEREOF. APN(s): 557-440-40 PARCEL 4: THE SOUTH 60.00 FEET OF THE NORTH 273.00 FEET OF THE WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWEST QUARTER OF QUARTER SECTION 129, RANCHO DE LA NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. EXCEPTING THEREFROM THE WEST 155.00 FEET. ALSO EXCEPTING THEREFROM THE EAST 30.00 FEET THEREOF. APN(s): 557-440-07 PARCEL 5: THE SOUTHERLY 65.00 FEET OF THE NORTHERLY 213.00 FEET OF THE WEST HALF OF THE SOUTH HALF OFTHE WEST HALF OF THE SOUTHWEST QUARTER OF QUARTER SECTION 129, RANCHO DE LA NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. EXCEPTING THEREFROM THE WEST 155.00 FEET. ALSO EXCEPTING THEREFROM THE EAST 30.00 FEET THEREOF. APN(s): 557-440-52 PARCEL 6: THE EASTERLY 150.00 FEET OF THE SOUTHERLY 58.00 FEET OF THE NORTHERLY 148.00 FEET OF THE WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWESTERLY QUARTER OF QUARTER SECTION 129, RANCHO DE LA NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, MAY 11, 1869. EXCEPTING THEREFROM THE EASTERLY 30.00 FEET. A-2 ALSO EXCEPTING THEREFROM THAT PORTION LYING WITHIN THE FOLLOWING DESCRIBED BOUNDARY: COMMENCING AT THE INTERSECTION OF THE NORTHERLY LINE OF THE WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWESTERLY QUARTER OF QUARTER SECTION 129 WITH THE WESTERLY LINE OF THE EASTERLY 30.00 FEET OF SAID WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWESTERLY QUARTER OF QUARTER SECTION 129; THENCE, ALONG SAID WESTERLY LINE SOUTH 18 44' 00" EAST, 9.80 FEET TO A POINT IN THE ARC OF A 50.00 FOOT RADIUS CURVE, THE CENTER OF WHICH BEARS SOUTH 55° 36' 12" EAST FROM SAID POINT AND BEING THE TRUE POINT OF BEGINNING; THENCE SOUTHWESTERLY, SOUTHERLY AND SOUTHEASTERLY ALONG THE ARC OF SAID CURVE THROUGH A CENTRAL ANGLE OF 97 32' 43" A DISTANCE OF 85.12 FEET TO THE BEGINNING OF A REVERSE 20.00 FOOT RADIUS CURVE; THENCE SOUTHEASTERLY ALONG THE ARC OF SAID CURVE THROUGH A CENTRAL ANGLE OF 44° 24' 55" A DISTANCE OF 15.50 FEET TO THE POINT OF TANGENCY IN THE WESTERLY LINE OF SAID EASTERLY 30.00 FEET; THENCE, ALONG SAID WESTERLY LINE NORTH 18 44' 00" WEST TO THE TRUE POINT OF BEGINNING. ALSO EXCEPTING THEREFROM THAT PORTION LYING WITHIN THE FOLLOWING DESCRIBED PROPERTY: BEGINNING AT THE NORTHWEST CORNER OF THE WEST HALF OF THE EAST HALF OF THE SOUTHWEST QUARTER OF THE WEST HALF OF LOT 2 OF SAID QUARTER SECTION 129 AS SHOWN ON THE MAP OF MILES MANOR NO. 1, ACCORDING TO THE MAP THEREOF NO. 5869 FILED IN THE OFFICE OF THE RECORDER OF SAID SAN DIEGO COUNTY, APRIL 21, 1967; THENCE, SOUTH 18° 44' 00" EAST ALONG THE EASTERLY LINE OF THE WEST HALF OF THE SOUTHWEST QUARTER OF THE WEST HALF OF SAID LOT 2, BEING ALSO THE CENTER LINE OF "Q" AVENUE AS SHOWN ON SAID MAP NO. 5869, A DISTANCE OF 108.99 FEET; THENCE, LEAVING SAID CENTER LINE AT RIGHT ANGLES SOUTH 71° 16' 00" WEST 30.00 FEET TO THE POINT OF TANGENCY OF A 20.00 FOOT RADIUS CURVE CONCAVE SOUTHWESTERLY, THE CENTER OF WHICH BEARS SOUTH 71° 16' 00" WEST, 20.00 FEET; THENCE, NORTHERLY ALONG THE ARC OF SAID 20.00 FOOT RADIUS CURVE THROUGH A CENTRAL ANGLE OF 44° 24' 55" A DISTANCE OF 15.50 FEET TO THE POINT OF TANGENCY WITH A REVERSE 50.00 FOOT RADIUS CURVE CONCAVE EASTERLY; THENCE, NORTHERLY ALONG THE ARC OF SAID 50.00 FOOT RADIUS CURVE THROUGH A CENTRAL ANGLE OF 97° 32' 43" A DISTANCE OF 85.12 FEET TO THE INTERSECTION WITH A LINE PARALLEL WITH AND 30.00 FEET WESTERLY AT RIGHT ANGLES TO SAID EASTERLY LINE OF THE WEST HALF OF THE SOUTHWEST QUARTER OF THE WEST HALF OF SAID LOT 2; THENCE, LEAVING SAID CURVE ALONG SAID PARALLEL LINE NORTH 18° 44' 00" WEST 19.87 FEET TO THE NORTHERLY LINE OF SAID SOUTHWEST QUARTER OF LOT 2; THENCE, NORTH 71° 02' 00" EAST ALONG SAID NORTHERLY LINE 30.00 FEET TO THE POINT OF BEGINNING. A-3 APN(s): 557-440-45 PARCEL 7: PARCEL B OF CERTIFICATE OF COMPLIANCE CASE FILE NO. 2008-39 CC, AS DISCLOSED IN THE GRANT DEED RECORDED SEPTEMBER 18, 2009 AS INSTRUMENT NO. 2009-0521138 OF OFFICIAL RECORDS, MORE PARTICULARLY DESCRIBED AS FOLLOWS: THE EASTERLY 90.00 FEET OF THE FOLLOWING DESCRIBED PARCEL OF LAND: THE NORTHERLY 30.00 FEET OF THE WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWEST ONE -QUARTER OF QUARTER SECTION 129, RANCHO DE LA NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY. EXCEPTING THEREFROM THE WESTERLY 30 FEET THEREOF AS DEEDED TO THE CITY OF NATIONAL CITY BY DEEDS RECORDED FEBRUARY 19, 1903 IN BOOK 325, PAGE 208 OF DEEDS AND JANUARY 5, 1928 IN BOOK 1388, PAGE 392 OF DEEDS. ALSO EXCEPTING THE EASTERLY 30.00 FEET THEREOF. AND ALSO EXCEPTING THAT PORTION LYING WITHIN THE FOLLOWING DESCRIBED BOUNDARY: COMMENCING AT THE INTERSECTION OF THE NORTHERLY LINE OF THE WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTH WESTERLY QUARTER OF QUARTER SECTION 129 WITH THE WESTERLY LINE OF THE EASTERLY 30.00 FEET OF SAID WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWESTERLY QUARTER OF QUARTER SECTION 129; THENCE ALONG SAID WESTERLY LINE SOUTH 18°44'00" EAST 9.80 FEET TO A POINT ON THE ARC OF A 50.00 FOOT RADIUS CURVE, THE CENTER OF WHICH BEARS SOUTH 55°36'12" EAST FROM SAID POINT AND BEING THE TRUE POINT OF BEGINNING; THENCE SOUTHWESTERLY, SOUTHERLY AND SOUTHEASTERLY ALONG THE ARC OF SAID CURVE, THROUGH A CENTRAL ANGLE OF 97°32'43" A DISTANCE OF 85.12 FEET TO THE BEGINNING OF A REVERSE 20.00 FOOT RADIUS CURVE; THENCE SOUTHEASTERLY ALONG THE ARC OF SAID CURVE, THROUGH A CENTRAL ANGLE OF 44°24'55" A DISTANCE OF 15.50 FEET TO THE POINT OF TANGENCY IN THE WESTERLY LINE NORTH 18°44'00"WEST TO THE TRUE POINT OF BEGINNING. TOGETHER WITH THE SOUTHERLY 60.00 FEET OF THE NORTHERLY 90.00 FEET OF THE WESTERLY HALF OF THE SOUTHERLY HALF OF THE WESTERLY HALF OF THE SOUTHWEST QUARTER OF QUARTER SECTION 129, OF RANCHO DE LA NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY; EXCEPTING THE WESTERLY 150.00 FEET THEREOF. A-4 ALSO EXCEPTING THE EASTERLY 30.00 FEET THEREOF. AND ALSO EXCEPTING THAT PORTION LYING WITHIN THE FOLLOWING DESCRIBED BOUNDARY: COMMENCING AT THE INTERSECTION OF THE NORTHERLY LINE OF THE WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWESTERLY QUARTER OF QUARTER SECTION 129 WITH THE WESTERLY LINE OF THE EASTERLY 30.00 FEET OF SAID WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWESTERLY QUARTER OF QUARTER SECTION 129; THENCE, ALONG THE SAID WESTERLY LINE SOUTH 18° 44' 00" EAST 9.80 FEET TO A POINT ON THE ARC OF A 50.00 FOOT RADIUS CURVE, THE CENTER OF WHICH BEARS SOUTH 55° 36' 12" EAST FROM SAID POINT AND BEING THE TRUE POINT OF BEGINNING; THENCE, SOUTHWESTERLY, SOUTHERLY, AND SOUTHEASTERLY ALONG THE ARC OF SAID CURVE THROUGH A CENTRAL ANGLE OF 97° 32' 43" A DISTANCE OF 85.12 FEET TO THE BEGINNING OF A REVERSE 20.00 FOOT RADIUS CURVE; THENCE, SOUTHEASTERLY ALONG THE ARC OF SAID CURVE THROUGH A CENTRAL ANGLE OF 44° 24' 55" A DISTANCE OF 15.50 FEET TO THE POINT OF TANGENCY IN THE WESTERLY LINE OF SAID EASTERLY 30.00 FEET; THENCE, ALONG SAID WESTERLY LINE NORTH 18° 44' 00" WEST TO THE TRUE POINT OF BEGINNING. APN(s): 557-440-46; 557-440-61 PARCEL 8: LOTS 6 AND 7 OF MILES MANOR UNIT NO. 1, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 5869, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, APRIL 21, 1967. AN UNDIVIDED 1/2 INTEREST IN LOT 8 AND AN UNDIVIDED 1/2 INTEREST IN THE NORTH HALF OF LOT 3 OF SAID MILES MANOR UNIT NO. 1, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 5869, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, APRIL 21, 1967. APN(s): 557-440-33 AND 557-440-34 PARCEL 9: LOTS 4 AND 5 AND AN UNDIVIDED ONE -QUARTER INTEREST IN AND TO THE NORTH HALF OF LOT 3 AND AN UNDIVIDED ONE -QUARTER INTEREST IN AND TO LOT 8, ALL IN MILES MANOR UNIT NO. 1 IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF A-5 NO. 5869, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY ON APRIL 21, 1967. APN(s): 557-440-31, 557-440-32, AND 557-440-43 PARCEL 10: LOTS 1 AND 2 AND THE SOUTHEASTERLY HALF OF LOT 3 OF MILES MANOR UNIT NO. 1, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 5869, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, APRIL 21, 1967. APN(s): 557-440-44 PARCEL 11: PARCEL NO. 2 OF PARCEL MAP NO. 890, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, FILED 1N THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, JULY 10, 1972, FILE NO. 177287, OF OFFICIAL RECORDS. APN(s): 557-440-53 PARCEL 12: PARCEL 1 OF PARCEL MAP 890, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY ON JULY 10, 1972, BEING A PORTION OF THE SOUTHWEST QUARTER OF QUARTER SECTION 129 OF RANCHO DE LA NACION IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 166 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. APN(s): 557-440-54 PARCEL 13: LOT 8 OF MILES MANOR UNIT NO. 1, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 5869, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, APRIL 21, 1967. APN(s): 557-440-35 PARCEL 15: A-6 THAT PORTION OF THE EASTERLY HALF OF THE EASTERLY HALF OF THE SOUTHWESTERLY QUARTER OF THE WESTERLY HALF OF LOT 2 IN QUARTER SECTION 129 OF RANCHO DE LA NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY ON MAY 11, 1869, DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHEASTERLY CORNER OF THE SOUTHWESTERLY QUARTER OF THE WESTERLY HALF OF SAID LOT 2; THENCE SOUTHERLY ALONG THE EASTERLY LINE OF SAID SOUTHWESTERLY QUARTER OF THE WESTERLY HALF OF LOT 2, A DISTANCE OF 233.00 FEET; THENCE WESTERLY ALONG A LINE PARALLEL WITH THE NORTHERLY LINE OF SAID SOUTHWEST QUARTER, A DISTANCE OF 165.00 FEET ORE OR LESS TO THE WESTERLY LINE OF THE EASTERLY HALF OF THE EASTERLY HALF OF THE SOUTHWESTERLY QUARTER OF THE WESTERLY HALF OF SAID LOT 2 IN QUARTER SECTION 129; THENCE NORTHERLY ALONG SAID WESTERLY LINE OF THE SOUTHWESTERLY QUARTER OF LOT 2; THENCE EASTERLY ALONG SAID NORTHERLY LINE, A DISTANCE OF 165.00 FEET MORE OR LESS TO THE POINT OF BEGINNING. APN(s): 557-440-56 A-7 LOAN AGREEMENT (Vista Del Sol Apartments) EXHIBIT B BUDGET (attached) 28 EXHIBIT B - SOURCES AND USES Sources and Uses of Funds Construction Permanent Debt: Pacific Western Bank Construction Loan 16,000,000 Pacific Western Bank Permanent Loan 9,007,000 CDC -HA Loan 7,407,795 7,407,795 Seller Carryback Loan 2,500,000 2,500,000 Seller Existing Replacement Reserves 212,313 212,313 Deferred Developer Fee 730,189 270,094 Project: Capitalized Interest (Interim & Construction) 560,314 560,314 Equity: Tax Credit Equity @ $1.01 1,863,373 9,316,467 TOTAL SOURCES 29,273,984 29,273,984 Property Acquisition 14,792,000 14,792,000 Renovation Costs 7,638,338 7,638,338 Indirect Costs: Third Party Reports 291,227 291,227 Financing Placement 352,435 352,435 Capitalized Interest (Interim & Construction) 560,314 560,314 Accounting 25,000 25,000 Legal & Organizational 150,000 150,000 Relocation Allowance 170,000 170,000 Loan Funding Reserve Account 1,200,000 1,200,000 Replacement Reserve 200,000 200,000 Operating Deficit Account 336,000 336,000 Tax Credit Reservation Fees 65,345 65,345 Other Fees and Costs 168,009 168,009 Developer Fee 3,325,316 3,325,316 TOTAL USES 29,273,984 29,273,984 B-1 EXHIBIT B - INCOME/EXPENSES Stabilized Income from Operations INCOME: Total Per Unit PSF Tax Credit Rents 1,439,532 10,906 19.16 Manager's Units 26,880 204 0.36 Other Income 19,317 146 0.26 TOTAL GROSS INCOME 1,485,729 11,256 19.78 Less: Vacancy 74,286 563 0.99 EFFECTIVE GROSS INCOME 1,411,443 10,693 18.79 EXPENSES: Less: Management Fee 102,992 780 1.37 Payroll & Benefits (inc. Mgr Units) 186,755 1,415 2.49 Office & Administration 111,843 847 1.49 Marketing & Advertising 845 6 0.01 Utilities: Water/Sewer 115,713 877 1.54 Garbage 20,583 156 0.27 Gas 18,474 140 0.25 Electricity 24,942 189 0.33 Maintenance General R&M 67,192 509 0.89 Turnover & Redecorating 9,085 69 0.12 Contract Services 26,654 202 0.35 Social Services 36,000 273 0.48 Insurance 35,776 271 0.48 Replacement Reserves 39,600 300 0.53 Total Before Taxes & Monitoring Fees 796,454 6,034 10.60 Taxes & CDC -HA Monitoring Fees* 59,449 450 0.79 Total Operating Expenses 855,903 6,484 11.39 NET OPERATING INCOME 555,540 4,209 7.40 * CDC -HA Monitoring Fees - To be determined and up to $215 per unit per year. LOAN AGREEMENT (Vista Del Sol Apartments) EXHIBIT C ELIGIBLE COSTS Eligible Costs include the following costs associated with the low and moderate income affordable component of the Project: Rehabilitation hard costs Soft costs Financing costs Relocation costs Reasonable developer fee and any other items approved in writing by Lender. 29 LOAN AGREEMENT (Vista Del Sol Apartments) EXHIBIT D PROJECT DESCRIPTION 30 EXHIBIT D — PROJECT DESCRIPTION Vista Del Sol Apartments consists of 14 two-story garden -style residential buildings featuring 132 flats style units. In addition, the property has a two-story community building and one-story ancillary buildings including a leasing office, and a maintenance building. The property has 78 one -bedroom units, 46 two -bedroom units, and eight three -bedroom units. The buildings are wood frame construction with stucco exteriors and pitched roofs. The improvements were originally constructed in 1978 and underwent extensive renovation in 2001 to revitalize a decaying crime ridden group of apartments. New construction of community space and a swimming pool as well as the introduction of new resident focused social services were also part of this neighborhood revitalization effort. To extend the physical and economic life of the property, the proposed rehabilitation scope of work will address health and safety, accessibility, maintenance, and energy efficiency issues and opportunities. Interior improvements include replacement of countertops and cabinetry, flooring and the installation of new refrigerators, ranges, range hoods, and dishwashers. Exterior improvements include window replacement, re -roofing, and painting the building exteriors. Site improvement will include parking lot and path of travel improvements, site fencing, and playground improvements. Building systems will be replaced and upgraded as necessary. Construction is scheduled to start in January 2018 and will be complete December 2018. Financing to support the proposed rehabilitation plan includes new tax credit equity, tax-exempt bond debt financing and the assumption of existing Community Development Commission - Housing Authority of the City of National City financing. The Property will maintain its original and current affordability mix of units renting to families earning 50% to 60% of area median income and thereby continue to help the City of National City meet its permanent affordable housing and resident quality of life goals. LOAN AGREEMENT (Vista Del Sol Apartments) EXHIBIT E SCHEDULE Task Date VistaDelSol ProjectSchedule ID Task Name % Complete Projected Start Projected Finish (Working Days j 1st Quarter 2rd Quarter '3rd Quarter 4th Quarter � ..__.._.._.. _._____ _ ____. ____..____.. .__._ J .E, __Fell .1 ___ . M3__�_AP�— M _ay. V jvl _._App .Sep.. Oct Nov _ DpS._._ 1 _._.....__ Vista Del Sol 0% Fri 12/29/17 Wed 12/26/18 256 days r 2 —211 Notice to Proceed 0% Fri 12/29/17 Fri 12/29/17 0 days 12/29 3 Mobilization 0% Fri 12/29/17 Tue 1/30/18 20 days 4 Substantial Project Completion 0% Wed 11/28/18 Wed 11/28/18 1 day 5 Final Punch List Repairs 0% Thu 11/29/18 Wed 12/26/18 20 days 6 Site Work 0% Mon 3/5/18 Fri 11/23/18 190 days 7 Concrete 0% Mon 3/5/18 Fri 7/13/18 95 days 1 0% 8 ADA Path of Travel 0% Mon 5/14/18 Fri 7/13/18 45 days _ 9 Concrete Stairtread Replacement 0% Mon 3/5/18 Fri 3/30/18 20 days 0% 10 Parking Lot 0% Mon 7/16/18 Fri 11/23/18 95 days 11 Asphalt - ADA Improvements, Patching, Signage 0% Mon 7/16/18 Fri 8/24/18 30 days :r•0% 12 ER Asphalt - Restripe 0% Mon 11/12/18 Fri 11/23/18 10 days 13 Landscape 0% Mon 8/27/18 Fri 10/26/18 45 days 14 +i Tree Trimming & Landscape 0% Mon 8/27/18 Fri 10/26/18 45 days — Xr 0% 15 Masonry 0% Mon 5/14/18 Fri 6/22/18 30 days 16 General Masonry Wall Repairs 0% Mon 5/14/18 Fri 6/22/18 30 days '�► 0% 17 Signage 0% Mon 10/22/18 Fri 11/2/18 10 days i 0% 18 Building & Unit Signage 0% Mon 10/22/18 Fri 11/2/18 10 days " 0% 19 Metals 0% Mon 7/16/18 Fri 8/10/18 20 days 20 Install New Cane Rail Detection at Stair Locations 0% Mon 7/16/18 Fri 8/10/18 20 days f 21 CO Install New Site Railings 0% Mon 7/16/18 Fri 8/3/18 15 days I, ox 22 Building Exterior 0% Mon 1/29/18 Tue 11/27/18 217 days 0% 23 Roofs 0% Mon 1/29/18 Fri 8/3/18 135 days t 1 0% 24 tgl Overlay Existing Roof w/New 20 Year NDL TPO 0% Mon 1/29/18 Fri 4/20/18 60 days .0% 25 Remove & Install New Shingle and Mansard Roofs 0% Mon 4/23/18 Fri 6/29/18 50 days * --0%- 1 26 New Sheet Metal Coping 0% Mon 4/23/18 Fri 5/4/18 10 days `f+ 0% Page 1 VistaDelSol ProjectSchedule ID �' Task Name % Complete Projected Start !Projected Finish Working Days 1st Quarter 2nd Quarter 3rd Quarter : 4th Quarter Dec JraFR4 Mar Apr 1 May Jun Jul I Aug I See Qst_ j Nov I Des 27 ' . Repair Gutters 0% Mon 7/23/18 Fri 8/3/18 10 days Tame. 0% 28 Dryrot Repairs @ Fascia & Catwalk 0% Mon 2/5/18 Fri 3/2/18 20 days - ►-- •s. 0% 29 Stucco 0% Mon 5/28/18 Fri 7/6/18 30 days 0% ^ 30 j Stucco Repairs 0% Mon 5/28/18 Fri 7/6/18 30 days .0% 31 Painting 0% Mon 7/9/18 Fri 10/19/18 75 days . i 0% 32 ! Powerwash Exterior Buildings 0% Mon 7/9/18 Fri 7/27/18 15 days ,0% 33 Exterior Building and Accessory Painting - 2 Coats 0% Mon 7/30/18 Fri 10/19/18 60 days - 0% 34 Valves 0% Mon 2/5/18 Fri 3/16/18 30 days r1 0% 35 ® Install New Building Shut -Off Valves 0% Mon 2/5/18 Fri 2/23/18 15 days .0% 36 ® Installl Seismic Shut -Off Valaves on Gas Meters 0% Mon 2/26/18 Fri 3/16/18 15 days 0% 37 Decks 0% Wed 10/17/18 Tue 11/27/18 30 days r 0% 38 Recoat All Elevated Decks & Stairways 0% Wed 10/17/18 Tue 11/27/18 30 days A 39 Windows 0% Mon 3/5/18 Fri 5/25/18 60 days 0% 40 '� New Vinyl Milgard Styline Retrofit Windows 0% Mon 3/5/18 Fri 5/25/18 60 days -0% 41 Doors 0% Mon 3/5/18 Fri 4/13/18 30 days 0% 42 --ig Utility Door Replacement 0% Mon 3/12/18 Fri 3/23/18 10 days 0% 43 n Replace Entry Doors, Deadbolt & Lockset 0% Mon 3/5/18 Fri 4/13/18 30 days 0% 44 Lighting 0% Mon 8/13/18 Fri 8/24/18 10 days n 0% 45 g Exterior Lighting 0% Mon 8/13/18 Fri 8/24/18 10 days + 0% 46 Common Areas 0% Mon 4/2/18 Fri 8/10/18 95 days 47 Clubhouse & Leasing Office Improvements 0% Mon 6/18/18 Fri 7/13/18 20 days 48 Laundry Room Improvements 0% Mon 7/16/18 Fri 8/10/18 20 days 0% 49 Boiler/Water Heater Replacements 0% Mon 4/2/18 Fri 4/27/18 20 days 50 .a"� Water Jet All Sewer Lines 0% Mon 4/30/18 Fri 5/18/18 15 days i 0% 51 Building Interiors 0% Mon 4/16/18 Tue 11/6/18 147 days 52 HVAC 0% Mon 4/16/18 Wed 6/6/18 38 days 0% Page 2 Vista DelSol_ProjectSchedule ID ! i i Task Name I% Complete .Projected Start PProjected Finish Working Days 1st Quarter 2nd Quarter 3rd QuarterI Avg Apr ) Sev ! 4th Quarter( Dec!an . Feb. j M� I, M@y ism( Jul Qct Nov I Dec 53 I® Install New PTAC Heat Pump in Units 0% Mon 4/16/18 Fri 5/25/18 30 days _ __i -- 0% 0% 'T 0% 0% 54 ® Install Wall Heaters in Buildings 1400,1410,1536,1538 0% Mon 5/28/18 Wed 6/6/18 8 days 55 n Install 40 Gallon Gas Waer Heater at 1538,1536,1410,1400 0% Mon 4/30/18 Wed 5/9/18 8 days 56 Binds & Shades 0% Wed 10/17/18 Tue 11/6/18 15 days r1 r 016 57 ® Install New Vertical Blinds in Units 0% Wed 10/17/18 Tue 11/6/18 15 days 58 Units 0% Tue 5/15/18 Tue 10/16/18 111 days 1 f-O'lfr— 59 Standard Production (125 Units) 0% Tue 5/15/18 Tue 10/16/18 111 days IP1 IT0% - n M" ' /'..'; —Air 0% 0% 1*1 IT7 ,af i.),... 1 4.. 0% 0% It7 0% i 0..., 60 Production Week 1 (2 Units) 0% Tue 5/15/18 Tue 5/22/18 6 days 61 Unit 1- 1543 (Slow Start) 0% Tue 5/15/18 Mon 5/21/18 5 days 86 Unit 5 - 1543 (Slow Start) 0% Wed 5/16/18 Tue 5/22/18 5 days 87 88 Production Week 2 (6 Units) 0% Tue 5/22/18 Wed 5/30/18 7 days Unit 2&6 - 1543 0% Tue 5/22/18 Mon 5/28/18 5 days 89 Unit 3&7 - 1543 0% Wed 5/23/18 Tue 5/29/18 5 days 90 Unit 8&4-1543 0% Thu 5/24/18 Wed 5/30/18 5 days 91 Production Week 3 (6 Units) 0% Tue 5/29/18 Wed 6/6/18 7 days 92 Unit 1&4 -1543 0% Tue 5/29/18 Mon 6/4/18 5 days 93 Unit 5&2 - 1543 0% Wed 5/30/18 Tue 6/5/18 5 days 94 Unit 6&3-1543 0% Thu 5/31/18 Wed 6/6/18 5 days 95 Production Week 4 (6 Units) 0% Tue 6/5/18 Wed 6/13/18 7 days 96 Unit 9&12-1539 0% Tue 6/5/18 Mon 6/11/18 5 days 97 Unit 8&11- 1539 0% Wed 6/6/18 Tue 6/12/18 5 days 98 Unit 7&10 - 1539 0% Thu 6/7/18 Wed 6/13/18 5 days 99 Production Week 5 (6 Units) O% Tue 6/12/18 Wed 6/20/18 7 days 100 Unit 4&5 - 1537 0% Tue 6/12/18 Mon 6/18/18 5 days 101 Unit 3&6 -1537 0% Wed 6/13/18 Tue 6/19/18 5 days1.7 102 Unit 11&12-1537 0% Thu 6/14/18 Wed 6/20/18 5 days Page 3 Vista DelSol_Projectschedule ID 0 ask Name %Complete iProjected Start Projected Finish 'Working Days I 1st Quarter I2nd Quarter Dec1 !an i Feb Mar l Aar I May i Jun 3rd Quarter - 4th Quarter !ul Ayg.i pep SLQ_____ Nov I Dec 103 Production Week 6 (6 Units) 0% Tue 6/19/18 Wed 6/27/18 7 days Unit 7&10 - 1537 0% Tue 6/19/18 Mon 6/25/18 5 days Unit 1&4 - 1445 0% Wed 6/20/18 Tue 6/26/18 5 days Unit 2&5 - 1445 0% Thu 6/21/18 Wed 6/27/18 5 days Production Week 7 (6 Units) 0% Tue 6/26/18 Wed 7/4/18 7 days Unit 3&6 - 1455 0% Tue 6/26/18 Mon 7/2/18 5 days Unit 9&12 - 1445 0% Wed 6/27/18 Tue 7/3/18 5 days Unit 8&11- 1445 0% Thu 6/28/18 Wed 7/4/18 5 days Production Week 8 (6 Units) 0% Tue 7/3/18 Wed 7/11/18 7 days Unit 7&10 - 1445 0% Tue 7/3/18 Mon 7/9/18 5 days Unit 1&4 - 1433 0% Wed 7/4/18 Tue 7/10/18 5 days Unit 2&5 - 1433 0% Thu 7/5/18 Wed 7/11/18 5 days Production Week 9 (6 Units) 0% Tue 7/10/18 Wed 7/18/18 7 daysir".410% Unit 3&6 - 1433 0% Tue 7/10/18 Mon 7/16/18 5 days Unit 9&12 - 1433 0% Wed 7/11/18 Tue 7/17/18 5 days Unit 8&11 - 1433 0% Thu 7/12/18 Wed 7/18/18 5 days Production Week 10 (6 Units) 0% Tue 7/17/18 Wed 7/25/18 7 days Unit 7&10 -1433 0% Tue 7/17/18 Mon 7/23/18 5 days Unit 1&4 - 1421 0% Wed 7/18/18 Tue 7/24/18 5 days Unit 2&5 - 1421 0% Thu 7/19/18 Wed 7/25/18 5 days Production Week 11(6 Units) 0% Tue 7/24/18 Wed 8/1/18 7 days Unit 3&6 -1421 0% Tue 7/24/18 Mon 7/30/18 5 days Unit 9&12 -1421 0% Wed 7/25/18 Tue 7/31/18 5 days Unit 8&11 - 1421 0% Thu 7/26/18 Wed 8/1/18 5 days` Production Week 12 (6 Units) 0% Tue 7/31/18 Wed 8/8/18 7 days Unit 7&10 - 1421 0% Tue 7/31/18 Mon 8/6/18 5 days rzi 0% ("'_ I;'/�' `M"`. 1Z1 I 'ie"i-, Pr1 pit.. 'M" `r `i�-•, WS 07L il %... I_ 0% I A 0% 104 105 106 107 108 109 110 111 112 113 114 115 116 117 118 119 120 121 122 123 124 125 126 127 128 Page 4 Vista DelSol_ProjectSched u Ie D _ !Task Name *Complete ;Projected Start�Projected Finish Working Days 1st Quarter . 2nd Quarter 13rd Quarter 14th Quarter 1 An Feb Mar Apr M y Jin Jul 1 Aug I Sec i Oct ( NRY 12Si __ 129 Unit 4&5 -1401 0% Wed 8/1/18 Tue 8/7/18 5 days 130 Unit 3&6 - 1401 0% Thu 8/2/18 Wed 8/8/18 5 days '►...•. 131 Production Week 13 (6 Units) 0% Tue 8/7/18 Wed 8/15/18 7 days 1T7 0% 132 Unit 11&12 - 1401 0% Tue 8/7/18 Mon 8/13/18 5 days "'.It I i,1'*" 133 Unit 7&10 - 1401 0% Wed 8/8/18 Tue 8/14/18 5 days 134 Unit 7 - 1421 & 1-1401 0% Thu 8/9/18 Wed 8/15/18 5 days "1.., 135 Production Week 14 (6 Units) 0% Tue 8/14/18 Wed 8/22/18 7 days A 0% 136 Unit 1&2 - 1400 0% Tue 8/14/18 Mon 8/20/18 5 days "* 137 Unit 3&4 - 1400 0% Wed 8/15/18 Tue 8/21/18 5 days 138 Unit 1&2 - 1410 0% Thu 8/16/18 Wed 8/22/18 5 days `'"e" 139 Production Week 15 (6 Units) 0% Tue 8/21/18 Wed 8/29/18 7 days 1'1 O% 140 Unit 3&4 - 1410 0% Tue 8/21/18 Mon 8/27/18 5 days -'S 141 Unit 7&10 - 1436 0% Wed 8/22/18 Tue 8/28/18 5 days 142 Unit 8&11 -1436 0% Thu 8/23/18 Wed 8/29/18 5 days '1^` 143 Production Week 16 (6 Units) 0% Tue 8/28/18 Wed 9/5/18 7 days ri 0% 144 Unit 9&12 - 1436 0% Tue 8/28/18 Mon 9/3/18 5 days "* 145 Unit 3&6 - 1436 0% Wed 8/29/18 Tue 9/4/18 5 days 146 Unit 2&5 - 1436 0% Thu 8/30/18 Wed 9/5/18 5 days 147 Production Week 17 (6 Units) 0% Tue 9/4/18 Wed 9/12/18 7 days r7a 0% i 148~ Unit 1&4 - 1436 0% Tue 9/4/18 Mon 9/10/18 5 days 149 Unit 9&12 - 1438 0% Wed 9/5/18 Tue 9/11/18 5 days 150 Unit 8&11- 1438 0% Thu 9/6/18 Wed 9/12/18 5 days 4r►. 151 Production Week 18 (6 Units) 0% Tue 9/11/18 Wed 9/19/18 7 days 1*1 O% 152 Unit 7&10 -1438 0% Tue 9/11/18 Mon 9/17/18 5 days jt s 153 Unit 1&4 - 1438 0% Wed 9/12/18 Tue 9/18/18 5 days ?r'. 154 Unit 2&5 - 1438 0% Thu 9/13/18 Wed 9/19/18 5 days 1rs Page 5 Vista DelSol_ProjectSchedule ID Task Name %Complete Projected Start (Projected Finish Working Days 11st Quarter 2nd Quarter 13rd Quarter : 4th Quarter 0 ' Dec Jan Feb_ ' Apr ' MU' ' IwL hl i Aug ; Oct I Nov 1 DES 155 Production Week 19 (6 Units) 0% Tue 9/18/18 Wed 9/26/18 7 days __FEW_ 156 Unit 3&6 - 1438 0% Tue 9/18/18 Mon 9/24/18 5 days 157 Unit 9&12 - 1440 0% Wed 9/19/18 Tue 9/25/18 5 days 158 Unit 8&11 - 1440 0% Thu 9/20/18 Wed 9/26/18 5 days 159 Production Week 20 (6 Units) 0% Tue 9/25/18 Wed 10/3/18 7 days rzi 0% 160 Unit 7&10 -1440 0% Tue 9/25/18 Mon 10/1/18 5 days '~ 161 Unit 1&4 - 1440 0% Wed 9/26/18 Tue 10/2/18 5 days 162 Unit 2&5 - 1440 0% Thu 9/27/18 Wed 10/3/18 5 days 163 Production Week 21 (6 Units) 0% Tue 10/2/18 Wed 10/10/18 7 days A 0% 164 Unit 3&6 - 1440 0% Tue 10/2/18 Mon 10/8/18 5 days 165 Unit 1&2 - 1536 0% Wed 10/3/18 Tue 10/9/18 5 days 166 Unit 3&4 - 1536 0% Thu 10/4/18 Wed 10/10/18 5 days 167 Production Week 22 (4 Units) 0% Tue 10/9/18 Tue 10/16/18 6 days j 0% 168 Unit 1&2 - 1538 0% Tue 10/9/18 Mon 10/15/18 5 days 169 Unit 3&4 - 1538 0% Wed 10/10/18 Tue 10/16/18 5 days 170 ADA Units (8 Units) 0% Mon 6/11/18 Fri 8/17/18 49 days 0% 171 Unit 1-1537 0% Mon 6/11/18 Fri 7/6/18 19 days 0% 172 Tenant Relocation 0% Mon 6/11/18 Fri 7/6/18 19 days r1 0% 173 Relocate Tenant 0% Mon 6/11/18 Mon 6/11/18 0 days • 6/11 '.. 174 Demo 0% Tue 6/12/18 Tue 6/12/18 1 day 175 Air Clearance 0% Wed 6/13/18 Wed 6/13/18 1 day 176 Rough Plumbing 0% Thu 6/14/18 Fri 6/15/18 2 days 177 Underground Plumbing Inspection 0% Mon 6/18/18 Mon 6/18/18 1 day 178 Framing 0% Tue 6/19/18 Wed 6/20/18 2 days 0% 179 Rough MP&E 0% Tue 6/19/18 Thu 6/21/18 3 days �j 180 Framing & MP&E Inspection 0% Fri 6/22/18 Fri 6/22/18 1 day Page 6 V ista DelSol_Proj ectSched u le ID Name '% Complete Projected Start Projected Finish :Working Days 1st Quarter ' 2nd Quarter 3rd Quarter : 4th Quarter 0(Task i - ''. ec lan I Feb ' J kl. , AMA. Sep 1 CM_ 1 Nov L OSS. 181 Drywall Mon 6/25/18 Wed 6/27/18 3 days --Mai_ .L 0% 182 Electrical 0% Thu 6/28/18 Thu 6/28/18 1 day 1 183 Plumbing 0% Mon 7/2/18 Mon 7/2/18 1 day 184 Flooring 0% Fri 6/29/18 Mon 7/2/18 2 days 185 Counters 0% Wed 7/4/18 Wed 7/4/18 1 day 186—' Cabinets 0% Tue 7/3/18 Tue 7/3/18 1 day 187 Paint 0% Thu 6/28/18 Fri 6/29/18 2 days g, 188 Hardware 0% Thu 6/28/18 Thu 6/28/18 1 day 189 Clean 0% Wed 7/4/18 Wed 7/4/18 1 day Itr 190 Final Inspection 0% Thu 7/5/18 Thu 7/5/18 1 day 191 Tenant Pick Up Keys 0% Fri 7/6/18 Fri 7/6/18 1 day 1921 Unit 2 - 1537 0% Mon 6/18/18 Fri 7/13/18 20 days 193 Unit 8 - 1537 0% '-•/ter+ 194 Unit 9 -1537 0% Mon 6/25/18 Mon 7/2/18 Fri 7/20/18 Fri 7/27/18 20 days 20 days i.-.......• 195 Unit 1- 1401 0% Mon 7/9/18 Fri 8/3/18 20 days -111•'�"^` 196 Unit 2 -1401 0% Mon 7/16/18 Fri 8/10/18 20 days ...ramoimme 197 Unit 9 - 1401 0% Mon 7/23/18 Fri 8/17/18 20 days --peetteentiale 0% Page 7 LOAN AGREEMENT (Vista Del Sol Apartments) EXHIBIT F FORM OF CONTRACTOR ADDENDUM CONSTRUCTION CONTRACT ADDENDUM This Construction Contract Addendum is made this day of by and between Vista Del Sol Apartments, L.P. ("Owner"), and ("Contractor"). RECITALS A. Owner and Contractor have entered into a construction agreement dated under which Contractor has agreed to undertake construction work on the above -captioned housing project (the "Contract"). B. Owner is borrowing funds from the Community Development Commission -Housing Authority of the City of National City, a public body, corporate and politic ("Lender") to support development of the Project, and has executed a Loan Agreement, Deed of Trust, Promissory Note, and Regulatory Agreement in connection with this Loan. The Loan Agreement, Deed of Trust, and Promissory Note are herein referred to as the "Loan Documents." C. Owner and Contractor wish to modify and add to the terms of the Contract as set forth in this Addendum, and Contractor agrees to be bound by the following provisions in the rehabilitation of said Project, in order to provide for certain terms required by Lender as a condition to financing of the Project. Lender has indicated that it will not make this Loan unless Contractor agrees to be bound by the terms hereof. NOW, THEREFORE, Owner and Contractor hereby agree as follows: 1. OWNER'S OBLIGATIONS. Owner agrees that any obligation imposed on Contractor by this Addendum does not waive, diminish, or alter any of Owner's obligations to Lender under the Loan Documents, and that the obligations of Contractor to Lender contained herein are in addition to those obligations of Owner to Lender contained in the Loan Documents. Owner shall be solely responsible for satisfying its obligations to Contractor under the Contract. 2. CONSENT TO ASSIGNMENT OF DEVELOPMENT RIGHTS. Contractor consents to the assignment of its Contract with Owner to Lender under the conditions specified in the loan agreement between Owner and Lender for the Project (the "Loan Agreement"). Contractor agrees that if there is a breach of the Loan Agreement or any other Event of Default, Lender may elect to enforce the assignment and take over the Contract. Contractor agrees to continue to perform its obligations under the Contract and this Addendum for the benefit and account of Lender in the same manner as if performed for the benefit and account of Owner in the absence of the assignment at no additional cost to Lender, as long as Contractor continues to receive the compensation called for under the Contract. Contractor agrees that Lender shall not have any obligation under the Contract until Lender notifies it in writing of Lender's election to accept the assignment. 1 3. COMMENCEMENT AND COMPLETION OF REHABILITATION. Contractor must begin rehabilitation of the Project by the date set for the commencement of rehabilitation in the Loan Agreement. Contractor may not commence rehabilitation until Lender has issued a written notice to proceed to Owner. Contractor must diligently prosecute rehabilitation of the Project to completion, and must complete rehabilitation of the Project by the completion date set forth in the Loan Agreement. 4. CONSTRUCTION BONDS. Contractor must obtain a labor and material (payment) bond and a performance bond, or a dual bond which covers both payment and performance obligations, with respect to the rehabilitation of the Project in a penal sum each of not less than one hundred percent (100%) of the scheduled cost of rehabilitation . Such bonds must be issued by a company which is authorized to transact surety insurance in California and which has assets exceeding its liabilities in an amount equal to or in excess of the bond amount. The bonds must name Lender as a co -obligee or assignee. In lieu of said bonds, a letter of credit in the sole name and possession of Lender in the penal amount and in a form acceptable to Lender may be substituted. 5. CONTRACT WORK. Contractor warrants and represents that it is licensed or otherwise authorized to perform the rehabilitation work specified in the Contract in the State of California. Contractor warrants and represents that it holds a current City of National City Business Tax Certificate. All rehabilitation work must be performed by persons or entities licensed or otherwise authorized to perform the applicable rehabilitation work in the State of California. Contractor shall insert similar provisions in all subcontracts for work for the Project. 6. SUBCONTRACTS. Contractor must submit to Owner for forwarding to Lender drafts of all of its construction subcontracts pertaining to development of the Project. Contractor understands that Lender retains the right to review and approve any such contract or any amendment to any construction contacts prior to execution in which the maximum contract amount exceeds $5,000. As a precondition to approval, Lender may require that the subcontractor enter into an agreement in substantially the same form as this Addendum. 7. QUALITY OF WORK. Contractor must construct the Project in conformance with the Plans and Specifications and any modifications thereto approved by Lender. Contractor must construct the Project according to general industry standards and shall employ building materials of a quality suitable for the requirements of the Project and conforming to general industry standards. Contractor must construct the Project in full conformance with applicable local, state, and federal statutes, regulations, and building and housing codes. The parties acknowledge that Lender is under no duty to review the Plans and Specifications or to inspect rehabilitation of the Project. Any review or inspection undertaken by Lender of the Project is solely for the purpose of determining whether Owner and Contractor are properly discharging their obligations to Lender, and should not be relied upon by Owner, Contractor, or any third parties as a warranty or representation by Lender as to the quality of the design or rehabilitation of the Project. 8. ADDITIONS OR CHANGES IN WORK. Lender and Owner must be notified in a timely manner of any changes in the work required to be performed under the Contract or this Addendum, including any substantial additions, changes, or deletions to the approved Plans and Specifications. A written change order authorized by Lender must be obtained before any of the following changes, additions, or deletions in work for the Project may be performed: (1) any change that exceeds ten thousand dollars ($10,000); or (2) any set of changes that cumulatively exceeds fifty thousand dollars ($50,000) or 10% of the Loan amount, whichever is less; or (3) any substantial change 2 in building materials or equipment, specifications, or the architectural or structural design of the Project as provided for in the Plans and Specifications. Consent to any additions, changes, or deletions to the work shall not release Contractor from any other obligations herein, or release Contractor or its surety from any surety bond. 9. SITE INSPECTIONS. Contractor shall permit and facilitate observation and inspection of work at the job site by Lender and its agents and by public authorities during reasonable business hours. 10. AUDITS. Contractor must make available for examination at reasonable intervals and during normal business hours to Lender's representatives all books, accounts, reports, files, and other papers or property with respect to all matters covered by the Contract and this Addendum, and must permit these representatives to audit, examine, and make copies, excerpts or transcripts from such records. 11. LEAD -BASED PAINT. Contractor and its subcontractors may not use lead -based paint in the rehabilitation or maintenance of the Property. Contractor must insert such a provision in all subcontracts for work performed on the Project which involve the application of paint. Borrower shall ensure, from the date of completion through the date the affordability period terminates, that the Project is in compliance with the lead based paint provisions contained in the Lead -Based Paint Poisoning Act (42 USC Section 4821 et seq.), 24 CFR Part 35, and 24 CFR Section 982.401(j). 12. NONDISCRIMINATION. Contractor may not discriminate against any employee or applicant for employment on the basis of race, color, religion, sex, sexual preference, national origin, AIDS or AIDS -related conditions, or disability in any phase of employment during rehabilitation. Contractor agrees to post in conspicuous places available to all employees and applicants for employment, notices to be provided setting forth the provisions of this nondiscrimination clause. 13.COMPLIANCE WITH LAWS. Contractor shall perform its work in conformity with all applicable laws, including all applicable state labor standards; the Lender zoning and development standards, building, plumbing, mechanical and electrical codes, and all other provisions of the Lender's Municipal Code, and all applicable disabled and handicapped access requirements, including without limitation the Americans With Disabilities Act, 42 U.S.C. Section 12101, et seq., Government Code Section 4450, et seq., Government Code Section 11135, et seq ., the Unruh Civil Rights Act, Civil Code Section 51, et seq., and the California Building Standards Code, Health and Safety Code Section 18900, et seq. 14. REPORTING. Contractor must submit information on forms supplied by Lender concerning the workforce and ownership composition of Contractor, its subcontractors and suppliers, as reasonably requested by Lender. 15. INSURANCE COVERAGE. Contractor, if Contractor is the general contractor for the Project, must have in full force and effect during the rehabilitation of the Project the insurance coverage required under the Loan Agreement. 16. WORKERS' COMPENSATION. Contractor must carry or cause to be carried Workers' Compensation and Employers' Liability Insurance as required by the California Labor Code for all persons employed in connection with this Project. 3 17. NON -LIABILITY OF OFFICIALS, EMPLOYEES AND AGENTS. No member, official, employee, or agent of Lender shall be personally liable to Contractor for any obligation created under the terms of the Contract or this Addendum except in the case of actual fraud or willful misconduct by such person. 18. INDEMNITY. Notwithstanding the insurance requirements herein, Contractor hereby indemnifies and holds Lender, its members, officers, officials, employees, and agents, harmless against any losses, damages, liabilities, claims, demands, judgments, actions, court costs, and legal or other expenses (including attorneys' fees) which Lender may incur as a consequence of Contractor's failure to perform any obligations as and when required by the Contract or this Addendum, any act or omission by Contractor or its subcontractors with respect to the Project, or any failure of any of Contractor's representations or warranties to be true and complete, except to the extent such losses are caused by the negligence or willful misconduct of Lender. Contractor shall pay immediately upon Lender's demand any amounts owing under this indemnity. The duty of Contractor to indemnify includes the duty to defend Lender in any court action, administrative action, or other proceeding brought by any third party arising from the Project. Contractor's duty to indemnify Lender shall survive the term of the Contract. 19. HAZARDOUS MATERIALS. Neither Contractor nor any of its subcontractors may use the Property or allow the Property to be used for the generation, manufacture, storage, disposal, or release of Hazardous Materials. Contractor shall immediately notify Lender and Owner in writing of: (a) the discovery of any concentration or amount of Hazardous Materials on or under the Property requiring notice to be given to any governmental agency under Hazardous Materials Laws; (b) any knowledge by Contractor that the Property do not comply with any Hazardous Materials Laws; (c) the receipt by Contractor of written notice of any Hazardous Materials claims; and (d) the discovery by Contractor of any occurrence or condition on the Property or on any real property located within 2,000 feet of the Property that could cause the Property to be designated as a "hazardous waste property" or as a "border zone property" under California Health and Safety Code Sections 25220, et seq., or regulations adopted therewith. 20. NOTICE OF DEFAULT TO LENDER. Contractor shall give Lender prior or concurrent written notice of any default or breach claimed by Contractor against Owner or any other party under the Contract. The notice shall describe the default and give Lender the option to cure said default within 30 calendar days. No termination of the Contract by Contractor shall be binding unless Lender has been given the required notice and has not cured the default within 30 calendar days. 21. REMEDIES. The parties hereto agree that Lender, while not a party to the Contract, is an intended third party beneficiary of the obligations imposed on Contractor in this Addendum. In the event of any breach or violation of any agreement or obligation of Contractor under the Contract or this Addendum, Lender may proceed with any of the following remedies: A. Bring an action in equitable relief seeking the specific performance by Contractor of the terms and conditions of the Contract or this Addendum, and/or enjoining, abating, or preventing any violation of said terms and conditions; B. Order immediate stoppage of rehabilitation and demand that any condition leading to the default be corrected before rehabilitation may continue; C. Enter the Property and take any actions necessary in its judgment to complete rehabilitation of the Project as permitted under the assignment of development rights; or 4 D. Pursue any other remedy allowed at law or in equity. 22. GOVERNING LAW. This Addendum shall be interpreted under and be governed by the laws of the State of California, except for those provisions relating to choice of law and those provisions preempted by federal law. 23. DEFINITIONS. Capitalized terms not defined in this Addendum shall have the same meaning as defined in the Loan Agreement. 24. ATTORNEYS' FEES AND COSTS. In the event any legal action is commenced to interpret or to enforce the terms of this Addendum, the prevailing party in any such action shall be entitled to recover all reasonable attorneys' fees and costs incurred in such action. 25. TIME. Time is of the essence in the performance of this Addendum by Contractor. 26. CONSENTS AND APPROVALS. Any consent or approval required under this Addendum shall not be unreasonably withheld, delayed, or conditioned. 27. BINDING UPON SUCCESSORS. All provisions of this Addendum shall be binding upon and inure to the benefit of the heirs, administrators, executors, successors -in -interest, transferees, and assigns of each of the parties; provided, however, that this section does not waive the prohibition on assignment of this Addendum by Contractor without Lender's consent. 28. RELATIONSHIP OF CONTRACTOR AND LENDER. Contractor understands that Lender neither undertakes nor assumes any responsibility or duty to Contractor or to any third party. The relationship of Contractor and Lender for this Project shall not be construed as a joint venture, equity venture, or partnership. Lender shall have no obligation to any party under the Contract, but is an intended third party beneficiary of the obligations under this Addendum. Contractor shall have no authority to act as an agent of Lender or to bind Lender to any obligation. 29. ASSIGNMENT. Contractor may not assign any of its interests under the Contract or the Addendum to any other party, except with the prior written consent of Lender. Any unauthorized assignment shall be void. 30. AMENDMENTS AND MODIFICATIONS. Any amendments or modifications to this Addendum must be in writing, and shall be made only if executed by Owner and Contractor, and consented to in writing by Lender. 31. SEVERABILITY. Every provision of this Addendum is intended to be severable. If any provision of this Addendum is held invalid, illegal, or unenforceable by a court of competent jurisdiction, the validity, legality, and enforceability of the remaining provisions shall not be affected or impaired. 32. ADDENDUM CONTROLS. In the event that any provisions of this Addendum and the Contract conflict, the terms of this Addendum shall control. [SIGNATURE BLOCKS ON NEXT PAGE] 5 IN WITNESS WHEREOF, the undersigned parties have executed this Construction Contract Addendum as of the date first written above. "CONTRACTOR" By: Title: "OWNER" VISTA DEL SOL APARTMENTS, L.P., a California limited partnership By: Vista Del Sol GP LLC, a California limited liability company, its general partner By: National Community Renaissance of California, a California nonprofit public benefit corporation, its managing member By: Its: 6 LOAN AGREEMENT (Vista Del Sol Apartments) EXHIBIT G INSURANCE REQUIREMENTS I. Insurance Coverage Requirements Borrower must procure, prior to Loan closing, and keep in force for the term of this Agreement, at Borrower's own cost and expense, the following policies of insurance or certificates or binders as necessary to represent that coverage as specified below is in place with companies doing business in California and acceptable to Lender. If requested, Borrower must provide Lender with copies of all insurance policies. The insurance must at a minimum include: A. Commercial General Liability insurance, shall cover liability arising from premises, operations, independent contractors, products -completed operations, personal and advertising injury, Bodily Injury, Broad Form Property Damage, and liability assumed under an insured contract (including the tort liability of another assumed in a business contract); Contractual Liability; XCU; and Owners and Contractor Protective Liability. Pollution Liability coverage is required if Loan proceeds are used for the remediation of Hazardous Materials. The CGL policy must contain severability of interest clause or cross liability clause or the equivalent thereof. If such CGL insurance contains a general aggregate limit, it shall apply separately to this Agreement. i. Coverage afforded on behalf of Lender shall be primary insurance and any other insurance available to Lender under any other policies shall be excess insurance (over the insurance required by this Agreement). ii. Limits of liability: Borrower must maintain commercial • general liability (CGL) and, if necessary, commercial umbrella insurance with a limit of not less than $2,000,000 each occurrence. If such CGL insurance contains a general aggregate limit, it must apply separately to this project. B. Automobile Liability Insurance. Borrower shall maintain automobile liability insurance for bodily injury and property damage liability with a limit of not less than $1,000,000 each accident. Such insurance shall cover liability arising out of any auto (including owned, hired, and non -owned autos). Coverage shall be at least as broad as Insurance Services Office Form Number CA 00 01. C. Worker's Compensation insurance as required by the laws of the State of California. Statutory coverage may include Employers Liability coverage with limits not less than $1,000,000. Borrower certifies that it is aware of the provisions of section 3700 of the California Labor Code, which require every employer to provide Workers' Compensation coverage, or to undertake self-insurance in accordance with the provisions of that Code. Borrower and its contractors must comply with the provisions of section 3700 of the California Labor Code before commencing performance of the work under this Agreement and thereafter as required by that code. D. Professional Liability/Errors and Omissions insurance as appropriate for design/build operations with limits not less than $2,000,000 each claim. If the professional liability/errors and omissions insurance is written on a claims made form: i. The retroactive date must be shown and must be before the date of the contract or the beginning of work. ii. Insurance must be maintained and evidence of insurance must be provided for at least three (3) years after completion of this Agreement. iii. If coverage is cancelled or non -renewed and not replaced with another claims made policy form with a retroactive date prior to the Agreement effective date, Borrower must purchase extended period coverage for a minimum of three (3) years after completion of work. E. Builders Risk/Course of Construction Insurance (CP 10 30) covering all risks of loss in an amount equal to the completed value form with no coinsurance penalty provisions and in an amount equal to the initial contract sum, subject to subsequent modification of the contract sum. The insurance shall apply on a replacement cost basis. The insurance shall name as insured the City of National City, the Borrower, and all subcontractors in the work. The insurance shall cover the entire work at the site identified herein including reasonable compensation for architectural services, engineering costs, financing costs, legal fees (soft costs) and expenses made necessary by an insured loss. Insured property shall include portions of the work located away from the site but intended for use at the site and shall also cover portions of the work in transit. The policy shall cover the cost of removing debris, including demolition as may be made legally necessary by the operation of any law, ordinance or regulation. The insurance shall be maintained in effect until the Project has been accepted as substantially complete. The insurer shall waive all rights of subrogation against the City. F. Property Insurance on an all risk coverage basis to the extent of full replacement value of the premises for the duration of the term of the Loan. Coverage amount may be adjusted for fluctuation in replacement values. This coverage is required upon completion of rehabilitation of the Project, or upon closing of this Loan if the Project is a rehabilitation project. G. Loss of Rents Insurance Coverage in the amount of 75% of scheduled annual gross rents. II. Terms, Conditions, and Endorsements The insurance required by this Agreement must be endorsed and have all the following conditions: A. Insured Status (Additional Insured): Borrower shall provide insured status naming the City of National City, its councilmembers, directors, officers, agents, employees and volunteers as insured's under the Commercial General Liability policy. General Liability coverage can be provided in the form of an endorsement to Borrower's insurance (at least as broad as ISO Form CG 2010 (11/85) or both CG 2010 and CG 20 37 forms, if later revisions used). If Borrower submits the ACORD Insurance Certificate, the insured status endorsement must be set forth on an ISO form CG 20 10 (or equivalent). A STATEMENT OF ADDITIONAL INSURED STATUS ON THE ACORD INSURANCE CERTIFICATE FORM IS INSUFFICIENT AND WILL BE REJECTED AS PROOF OF MEETING THIS REQUIREMENT. B. Loss Payee: Borrower must ensure that the City of National City, its Councilmembers, directors, officers, agents, employees and volunteers are named as Loss Payee in the Builders' Risk Insurance and Property Insurance. Borrower shall provide appropriate Loss Payee endorsement as proof of meeting this requirement. C. Cancellation Notice: 30-day prior written notice of termination or material change in coverage and 10-day prior written notice of cancellation for non-payment. D. The Worker's Compensation policy shall be endorsed with a waiver of subrogation in favor of the City for all work performed by the contractor, its employees, agents and subcontractors. E. Cross -liability coverage as provided under standard ISO forms' separation of insureds clause. F. Certificate holder is to be the same person and address as indicated in the "Notices" section of this Agreement. G. Insurer must carry an A.M. Best Rating of A VII, or better. III. Replacement of Coverage In the case of the breach of any of the insurance provisions of this Agreement, Lender may, at Lender's option, take out and maintain at the expense of Borrower such insurance in the name of Borrower as is required pursuant to this Agreement, and may deduct the cost of taking out and maintaining such insurance from any sums which may be found or become due to Borrower under this Agreement. IV. Insurance Interpretation All endorsements, certificates, forms, coverage and limits of liability referred to herein shall have the meaning given such terms by the Insurance Services Office (ISO) as of the date of this Agreement. V. Proof of Insurance Borrower will be required to provide proof of all insurance required for the Loan prior to execution of the Loan Agreement, including copies of Borrower's insurance policies, if and when requested. Failure to provide the insurance proof requested or failure to do so in a timely manner shall constitute grounds for rescission of the Loan Agreement award. VI. Subcontractors Should Borrower subcontract out the work required under this Agreement, they shall include all subcontractors as insureds under its policies or shall maintain separate certificates and endorsements for each subcontractor. As an alternative, Borrower may require all subcontractors to provide at their own expense evidence of all the required coverages listed in this Exhibit. If this option is exercised, both Lender and Borrower shall be named as additional insured under the subcontractor's General Liability policy. All coverages for subcontractors shall be subject to all the requirements stated herein. Lender reserves the right to perform an insurance audit during the course of the project to verify compliance with requirements. VII. Deductibles and Self -Insured Retentions Any deductible or self -insured retentions must be declared to and approved by Lender. At the option of Lender, either: the insurer shall reduce or eliminate such deductible or self -insured retentions as respects Lender, its Councilmembers, directors, officers, agents, employees and volunteers; or Borrower shall provide a financial guarantee satisfactory to Lender guaranteeing payment of losses and related investigations, claim administration and defense expenses. VIII. Waiver of Subrogation Borrower waives all rights against the Community Development Commission -Housing Authority of the City of National City and its Councilmembers, officers, directors, employees and volunteers for recovery of damages to the extent these damages are covered by the forms of insurance coverage required above. IX. Evaluation of Adequacy of Coverage Lender maintains the right to modify, delete, alter or change these requirements, with reasonable notice, upon not less than ninety (90) days prior written notice. �� I1- - CALIFORNI�f rsr \1 A I, O .filr \L CIit �`� r `/ INCORPORATED The City of National City MEMORANDUM DATE: December 12, 2017 TO: City Clerk's Office FROM: Angelita Palma, Community Development Specialist II Housing & Economic Development Department RECEIVED CITY CLERK 1018 MAI 23 P 2: 4b CITY OF NATIONAL CITY SUBJECT: Recorded Loan Documents for Vista Del Sol Apartments Resyndication Please keep the attached original documents on file for the Resyndication of Vista Del Sol Apartments L.P. in the amount $7,407,795.08 dated December 18, 201. Vista Del Sol Apartments located at 1545 "Q" Avenue in National City Attachments: 1) Loan Documents, 2) Recorded Ground Lease, and 3) Amended and Restated Loan Agreement 1243 National City Blvd; National City, California 91950 RESOLUTION NO. 2017 — 61 RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY APPROVING THE REFINANCING TERMS FOR VISTA DEL SOL APARTMENTS LOCATED AT 1545 "Q" AVENUE IN NATIONAL CITY THAT PRESERVES AFFORDABILITY FOR 130 APARTMENT UNITS THROUGH DECEMBER 31, 2073; APPROVING THE REINSTATEMENT OF TWO LOANS MADE BY THE HOUSING AUTHORITY AS ONE NEW LOAN IN THE TOTAL AMOUNT OF $7,407,795.08 TO BE ASSUMED BY VISTA DEL SOL APARTMENT, L.P.; AND AUTHORIZING THE EXECUTIVE DIRECTOR TO EXECUTE THE AMENDED AND RESTATED LOAN AND REGULATORY AGREEMENTS AND ANY OTHER DOCUMENTS NECESSARY TO CLOSE ESCROW WHEREAS, Vista Del Sol Apartments, L.P. ("Borrower") proposes to assume and modify the ownership structure of Vista Del Sol Apartments, a 132-unit affordable rental housing development at 1545 "Q" Avenue, in National City (the "Property"); and WHEREAS, the acquisition and proposed rehabilitation is intended to serve as a community resource by providing decent, safe, and sanitary housing for households who would otherwise be unable to afford such housing; and WHEREAS, the Community Development Commission of the City of National City ("Original Lender") previously provided the properties with financial assistance in the form of loans from public funds to support development of the properties to increase and improve the supply of housing available in the community to low and moderate -income households; and WHEREAS, the Original Lender and Copper Hills Apartments Limited Partnership, a California limited partnership ("Prior Owner"), entered into that certain Affordable Housing Agreement dated as of December 7, 1988 ("Affordable Housing Agreement") in which the Prior Owner received a secured loan from the Original Lender, from the Original Lender's Low and Moderate Income Housing Fund and from HOME funds in an original principal amount of $2,400,000, secured by deed of trust recorded on the property with the San Diego County Recorder on May 27, 1999, as Instrument No. 1999-0363599 ("Former RR Loan"), which is more particularly described in the Affordable Housing Agreement. The Former RR Loan funds have been fully disbursed. $771,658 in principal remains outstanding and $3,797 in interest has accrued as of December 12, 2017, under the Former RR Loan; and WHEREAS, the Prior Owner received a second secured loan from the Original Lender from the Original Lender's issuance of tax allocation bond proceeds in an original principal amount of $4,454,037.07, secured by deed of trust recorded on the property with the San Diego County Recorder on June 2, 1999, as Instrument No. 1999-0382563 ("Former Rehab Loan"), which is more particularly described in the Affordable Housing Agreement. The Former Rehab Loan funds have been fully disbursed. $4,454,037 in principal remains outstanding and $2,349,504 in interest has accrued as of December 12, 2017, under the Former Rehab Loan. The Former Rehab Loan together with the Former RR Loan, shall be referred to herein together, as the "Former Loan"; and WHEREAS, that certain Regulatory Agreement and Declaration of Restrictive Covenants dated as of December 7, 1998, and recorded in the Office of the County Recorder for the County of San Diego on December 11, 1998, as Instrument Number 1998-0807600 ("Previous Regulatory Agreement") was originally made by the Prior Owner and Original Lender; and Resolution No. 2017 — 61 Page Two WHEREAS, the Community Development Commission -Housing Authority of the City of National City ("Lender") elected to retain the housing assets of and functions previously performed by the Original Lender pursuant to California Health and Safety Code Section 34176, and thereby, by operation of law, the Lender assumed the rights and obligations of the Original Lender with respect to the Affordable Housing Agreement; and WHEREAS, the Borrower is acquiring the Property from the Prior Owner, the Borrower is assuming all of the rights and liabilities of the Prior Owner with respect to the Affordable Housing Agreement and with respect to the Consolidated, Amended and Restated Promissory Note, as defined below. The Lender and Borrower desire to amend and restate the Affordable Housing Agreement in its entirety. Concurrently with the Amended and Restated Loan Agreement ("Restated Loan Agreement"), the promissory notes for the Former Loan are being consolidated, amended and restated into a single Amended and Restated Promissory Note which will be executed by Borrower in the original principal amount of $7,407,795.08 ("Loan"). Each deed of trust securing the Former Loan is being reconveyed, and a new Deed of Trust securing the Loan is being executed and recorded against the Property. These instruments are intended to secure Lender's continuing interest as a governmental entity in the affordability and habitability of the Property, as well as to secure performance of other covenants contained in such agreements; and WHEREAS, The Lender and Borrower also desire to amend and restate the Previous Regulatory Agreement in its entirety. The Amended and Restated Regulatory Agreement (Restated Regulatory Agreement) will be executed and recorded pursuant to the requirements of California Health and Safety Code Section 33334.3. The purpose of this Restated Regulatory Agreement is to regulate and restrict the occupancy, rents, operation, ownership, and management of the property for the benefit of project occupants and the people of the City of National City. The covenants in the Restated Regulatory Agreement are intended to run with the land and be binding on Borrower and Borrower's successors to the land for the full term of the Restated Regulatory Agreement. NOW, THEREFORE, BE IT RESOLVED, that the Community Development Commission -Housing Authority of the City of National City hereby approves the refinancing terms for Vista Del Sol Apartments located at 1545 "Q" Avenue in National City that preserves affordability for 130 apartment units through December 31, 2073; approving the reinstatement of two loans made by the Housing Authority as one new loan in the total amount of $7,407,795.08 to be assumed by Vista Del Sol Apartment, L.P.; and authorizing the Executive Director to execute the Amended and Restated Loan and Regulatory Agreements and any other documents necessary to close escrow. The Amended and Restated Regulatory Agreement will be publicly recorded at the County of San Diego Recorder's Office at the close of escrow and a copy of the Amended and Restated Loan Agreement will be available at the Office of the City Clerk. [Signature Page to Follow] Resolution No. 2017 — 61 Page Three PASSED and ADOPTED this 19th day of Dece 2017. Ron Morrison, Chairman ATTEST: Leslie Deese, Secretary APPROVED AS TO FORM: orris-J eral Counse Passed and adopted by the Community Development Commission -Housing Authority of the City of National City, California, on December 19, 2017 by the following vote, to -wit: Ayes: Commissioners Cano, Mendivil, Morrison, Rios, Sotelo-Solis. Nays: None. Absent: None. Abstain: None. AUTHENTICATED BY: RON MORRISON Chairman, Housing Authority Secretary, Housing Authority By: Deputy I HEREBY CERTIFY that the above and foregoing is a full, true and correct copy of RESOLUTION NO. 2017-61 of the Community Development Commission -Housing Authority of the City of National City, California, passed and adopted on December 19, 2017. Secretary, Housing Authority By: Deputy CITY OF NATIONAL CITY, CALIFORNIA COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY COUNCIL AGENDA STATEMENT EETING DATE: December 19, 2017 AGENDA ITEM NO. 24 ITEM TITLE: Resolution of the Community Development Commission -Housing Authority of the City of National City ("Housing Authority") approving the refinancing terms for Vista Del Sol Apartments located at 1545 "Q" Avenue in National City that preserves affordability for 130 apartment units through December 31, 2073; approving the reinstatement of two loans made by the Housing Authority as one new loan in the total amount of $7,407,795.08 to be assumed by Vista Del Sol Apartment, L.P.; and authorizing the Executive Director to execute the Amended and Restated Loan and Regulatory Agreements and any other documents necessary to close escrow. PREPARED BY: Carlos Aguirre, Housing & Economic Dev. Mgr. PHONE: 619-336-4391 EXPLANATION: See attached Term Sheet (Attachment No. 1). DEPARTMENT: APPROVED B Ho sing & Economic D' : lopment FINANCIAL STATEMENT: ACCOUNT NO. APPROVED: APPROVED: The terms of the refinance are discussed in Attachment No. 1. No additional cash contribution is required from the Housing Authority for the refinance transaction. ENVIRONMENTAL REVIEW: Categorically exempt from CEQA review by 14 CCR 15301(a). ORDINANCE: INTRODUCTION: FINAL ADOPTION: Finance MIS STAFF RECOMMENDATION: Adopt the Resolution. BOARD / COMMISSION RECOMMENDATION: n/a ,TTACHMENTS: 1. Refinancing Terms 2. Loan and Regulatory Documents 3. Resolution Attachment No. 1 Vista del Sol Apartments National City, CA Final CDC -HA Term Sheet (Re -Syndication) — Updated 12/6/17 • Project Description National Community Renaissance of California ("NCRC") proposes to refinance Vista del Sol Apartments ("Project") in order to rehabilitate and extend its physical/economic life. The 132 unit apartment community will maintain its affordability mix and will continue to help the City of National City meet its affordable housing goals. The unit mix is and will remain 78 one bedroom units; 46 two bedroom units; 6 three bedroom units; and 2 three bedroom manager's units with an average affordability of 58% of Area Median Income (AMI). The Project is currently owned by Copper Hills Apartments, L.P. ("Original Owner"). In 1999, the Original Owner executed the following promissory notes as well as other related loan documents in favor of the Community Development Commission of the City of National City ("CDC"), collectively, the "CDC Loan": 1) Residual Receipts Note, dated February 18, 1999, in the original principal amount of $2,400,000.00 ("CDC RR Note"). 2) Residual Receipts Note, dated June 1, 1999, in the original principal amount of $4,454,037.07 ("CDC Rehab Note"). NCRC has formed Vista Del Sol Apartments, L.P., a new tax credit limited partnership ("Owner"), which will acquire the Project from the Original Owner and utilize new 4% tax credit equity ("Re -syndication") and tax-exempt bond financing to support the proposed rehabilitation of the Project in December 2017. Owner is assuming the rights and obligations of the Original Owner under the CDC Loan. The Community Development Commission -Housing Authority of the City of National City ("CDC -HA") elected to retain the housing assets of and functions previously performed by the Original Lender pursuant to California Health and Safety Code Section 34176, and thereby, by operation of law, CDC -HA assumed the rights and obligations of the CDC with respect to the CDC Loan. The proposed re -syndication will trigger the need for material changes to the existing terms of the CDC Loans financing and affordability terms for the Project. Page 1 of 10 Attachment No 1 • Financing • CDC -HA Financial Participation Existing financing on the Project will be modified as follows: • The Original Owner will pay-off the existing permanent loans held by JP Morgan Chase from proceeds of the sale of the Project; • The CDC -HA and Owner will consolidate the two (2) CDC Loans/Notes into a single Consolidated Loan/Note of $7,407,795.08 and the CDC -HA will amend and restate the same into a Consolidated, Amended and Restated Loan Secured by Deed of Trust ("CDC -HA Loan"); and • Owner will use existing Project reserves ("Reserves") of about $212,313 and operating income ("Operating Income") of about $557,204 to finance acquisition and/or development costs. Proposed new financing on the Project will include sources in the approximate amounts: • permanent tax-exempt mortgage: $9,007,000; • limited partners (4% tax credits): $9,316,467; • seller take -back: $2,500,000; and, • deferred developer fee: $273,204. Owner will assume and Owner and CDC -HA will amend and restate the documents evidencing the CDC -HA Loan at construction loan closing ("Closing") in December 2017 to assist in the re -syndication and rehab of the Project. The original sources and projected balances of the Original CDC Loan and accrued interest amounts as of December 31, 2017 are as follows: • CDC RR Loan: The CDC and Original Owner entered into that certain Affordable Housing Agreement dated as of December 7, 1988 ("Affordable Housing Agreement"). Pursuant to which the Prior Owner received a secured loan from Original Lender, from the Original Lender's Low and Moderate Income Housing Fund and from HOME funds in an original principal amount of $2,400,000. The Former RR Loan funds have been fully disbursed. $463,677.81 in outstanding principal and $6,955.17 in accrued interest is projected as of December 31, 2017. The sum of principal plus ' Funded under Multifamily Housing Revenue Bond (Q Avenue Project) 1999 Series A (Tax Exempt) and 1999 Series B (Taxable) Page 2 of 10 Attachment No 1 accrued interest as of December 31, 2017 will be approximately $470,632.98. • CDC Rehab Loan: The Original Owner received a second secured loan from the CDC from the CDC's issuance of tax allocation bond proceeds in an original principal amount of $4,454,037.07. The Former Rehab Loan funds have been fully disbursed. $4,454,037 in outstanding principal and $2,483,125.10 in accrued interest is projected as of December 31, 2017. The sum of principal plus accrued interest as of December 31, 2017 will be approximately $6,937,163.10. CDC -HA Loan Amount: The CDC -HA and Owner will consolidate the above two (2) CDC Loan/Notes into a single consolidated CDC -HA Loan/Note of $7,407,795.08. CDC -HA Loan Interest Rate: The CDC -HA Loan/Note shall bear simple interest at the rate of 3%. All interest will be computed based on a 365-day year and applied to the actual number of days elapsed. CDC -HA Loan Maturity Date: Owner shall pay to the order of CDC -HA the full amount of the outstanding principal under the CDC -HA Loan Agreement together with all accrued but unpaid interest thereon, on the earliest of: (a) December 31, 2073; (b) the date the Property is sold (specifically excluding a transfer of the Property to an affiliate of Owner's managing general partner following the expiration of the tax credit compliance period); or (c) an Event of Default by Owner as defined in the CDC -HA Loan Agreement which has not been cured in the manner and time provided in the CDC -HA Loan Agreement. Notwithstanding the above, payments shall also be due from syndication proceeds, leveraged funds, and other funds received by Owner or an affiliate as required by Lender under the syndication provision of the CDC -HA Loan Agreement. CDC -HA Loan Funding Reserve: Owner will fund a reserve in the amount of $1,200,000.00 ("Loan Funding Reserve"), $500,000 of which the Owner shall fund at closing and $700,000 of which Owner shall fund at permanent loan conversion. The Loan Funding Reserve shall be maintained in a separate account in the name of the Borrower, provided that no disbursements from the Pagc 3 of I n Attachment No. 1 Loan Funding Reserve shall be made without the express written consent of the CDC -HA. The Borrower shall account to the Lender for any monies expended from the reserves. Amount and Time of Payment: Until such time as the Loan Funding Reserve is depleted, Borrower shall make annual payments under CDC -HA Note, equal to the greater of: (i) $250,000.00 (provided that if the amount in the Loan Funding Reserve is less than $250,000.00, then as much as is in the Loan Funding Reserve at such time); or (ii) the CDC-HA's Prorata Share of the Available Cash Flow, as defined below. To the extent the CDC-HA's Prorata Share of the Available Cash Flow in any calendar year is less than $250,000.00, then funds may be disbursed from the Loan Funding Reserve to the CDC -HA in an amount equal to the difference between $250,000.000 and the CDC-HA's Prorata Share of the Available Cash Flow. At such time as all funds in the Loan Funding Reserve have been disbursed to the Lender, as set forth in the immediately preceding sentence, and each calendar year thereafter, the Borrower shall make annual payments under the CDC -HA Note, equal to the CDC-HA's Prorata Share of the Available Cash Flow. Payment for each calendar year shall be made no later than April 15 of the following year. Borrower shall provide Lender, no later than February 15, with an accounting, prepared by an independent auditor, of the Operating Revenues and Operating Expenses, as defined below, for the previous calendar year. CDC-HA's Prorata Share: CDC-HA's Prorata Share means the portion of Available Cash Flow to which CDC - HA is entitled, which shall be split among Project lenders with surplus cash flow loans based on relative loan amounts. For CDC-HA's Note, CDC-HA's Prorata Share shall be 45%. "Available Cash Flow" means the annual Operating Revenues minus the annual Operating Expenses for the property. "Operating Revenues" shall mean all income derived from the Property, and shall include, without limitation: (1) rents (including rent on common space within the Property); (2) rent subsidy payments received on behalf of tenants; (3) interest on income other than interest on reserve accounts approved by Lender; and (4) receipts from laundry, parking, vending, or other services in which a fee is charged. "Operating Expenses" shall mean: (1) all direct costs and expenses necessary to operate the Property as approved by Lender, including but not limited to an annual property Page 4 of 10 Attachment No. 1 management fee of $87,943.68 ($55.52 per unit per month), increasing by 3% per annum and an annual bookkeeping fee of $15,048 ($9.50 per unit per month; (2) debt service on any loans secured by the Property, provided that such loans have been used to acquire the Property or develop or improve the Project (or to refinance loans used for Project acquisition, development or improvement), have been approved by Lender, and are secured by a deed of trust on the Property that is senior in priority to the Deed of Trust; (3) reasonable payments, approved by Lender, to reserves for operating contingencies, replacement of capital items, and other reserve uses as approved by Lender; (4) a general partner asset management fee of $15,000 increasing annually by 3% (which shall accrue to the extent not paid), an annual social service fee of $36,000 increasing annually by 3% and limited partner asset management fee of $6,500 increasing annually by 3%; (5) any deferred development fee; (6) payments of tax credit adjusters to the limited partners of the Maker; (7) repayment of operating loans made by the general partner of the Maker and (8) repayment of "Voluntary Funding" loans, as defined in Section 7.7 of the Maker's partnership agreement, to the extent any such "Voluntary Funding" loan is made to pay Operating Expenses. CDC -HA Project Monitoring: Owner shall maintain and submit records to CDC -HA within ten business days of CDC-HA's request which clearly document Owner's performance under each requirement of the CDC -HA Loan Documents. Owner shall supply promptly, upon CDC- HA's reasonable request, any information or documentation pertaining to the Project and must cooperate with CDC-HA's representatives on matters related to Project monitoring and evaluation. Commencing upon completion of rehabilitation, Owner shall pay to the CDC -HA an annual monitoring fee ("CDC -HA Loan Monitoring Fee"), up to $215 per unit per year as determined by the CDC -HA in schedules printed by the CDC -HA from time to time. The CDC -HA Loan Monitoring Fee shall be subject to revision annually. The CDC -HA Loan Monitoring Fee shall be paid to the CDC -HA annually within ten (10) days after the CDC -HA provides a written invoice to Owner for the same. Failure to timely pay the CDC -HA Loan Monitoring Fee shall constitute a material default under this Agreement and the Regulatory Agreement. The CDC -HA Loan Monitoring Fee shall be paid to the CDC -HA as a consideration for the lending of funds by the CDC -HA to the Owner. Page 5 of 10 Attachment No. 1 • CDC -HA Loan Documents: CDC -HA Staff & Legal Expenses: CDC -HA has requested and the Owner has agreed to pay for CDC -HA staff and legal costs associated with the CDC-HA's financial participation in the re -syndication of Vista Del Sol. Non -Recordable Documents to be assigned and assumed: Original Owner and the CDC -HA are all of the current parties to (collectively, the "CDC -HA Loan Documents"): (i) that certain Affordable Housing Agreement dated as of December 7, 1988; (ii) that certain Residual Receipts Promissory Note, dated February 18, 1999, in the original principal amount of $2,400,000.00; (iii) that certain Residual Receipts Promissory Note (Secured by Deed of Trust), dated June 1, 1999, in the original principal amount of $4,454,037.07. The Original Owner will assign all of the Original Owner's interest in the CDC -HA Loan Documents to the Owner, and the Owner will assume all of the Original Owner's interest in the CDC -HA. The CDC -HA will provide its condition precedent to the assignment and assumption of the CDC -HA Loan Documents. Recordable Documents to be assigned and assumed: Original Owner and the CDC -HA are all of the current parties to: (i) that certain Regulatory Agreement and Declaration of Restrictive Covenants dated as of December 7, 1998, and recorded in the Office of the County Recorder for the County of San Diego on December 11, 1998 as Instrument Number 1998-0807600 ("Regulatory Agreement"); and (ii) that certain Operation and Maintenance Agreement dated as of December 7, 1998, and recorded in the Office of the County Recorder for the County of San Diego on December 11, 1998 as Instrument Number 1998-0807604 ("Operation Agreement"). The Original Owner will assign all of the Original Owner's interest in the Regulatory Agreement and Operation Agreement to the Owner, and the Owner will assume all of the Original Owner's interest in the Regulatory Agreement and Operating Agreement. The CDC -HA will provide its condition precedent to the assignment and assumption of the Regulatory Agreement and Operating Agreement. Amended and Restated CDC -HA Loan Documents: The CDC -HA and Owner will amend and restate the Affordable Housing Agreement. Concurrently with this Agreement, the promissory notes for the CDC Loan will be Page 6 of 10 Attachment No. 1 • City Ground Lease: • Legal Ownership Structure • Transfer of Project consolidated, amended and restated into a single Amended and Restated Promissory Note which will be executed by Owner in the original principal amount of $7,407,795.08. Each deed of trust securing the CDC Loan will be reconveyed, and a new Deed of Trust securing the CDC will be executed and recorded against the Property. The previous regulatory agreements and restrictive covenant executed in connection with the CDC Loan will be amended and restated by Owner and CDC -HA concurrently with this Agreement and recorded against the Property. Ground Lease: Original Owner and the City of National City ("City") are all of the current parties to that certain Ground Lease dated as of August 15, 2000 for that certain parcel located at 1500 0 Street, National City with the Assessor's Parcel # 557-440-25 ("Ground Leased Parcel"). The Original Owner will assign all of the Original Owner's interest in the Ground Lease to the Owner, and the Owner will assume all of the Original Owner's interest in the Ground Lease. The City will provide its condition precedent to the assignment and assumption of the Ground Lease. Subsequent to the closing of re - syndication financing, Owner and City will negotiate the fee simple transfer of the Ground Leased Parcel for a price to be determined. Vista Del Sol Apartments, L.P. will be the owner of the Project. The Managing General Partner will be Vista Del Sol GP LLC with National Community Renaissance of California (NCRC) as the managing member. NCRC will also serve as developer, and property manager for Project. NCRC purchased the Special Limited Partner and Limited Partner Interests of the Original Owner in November 2017 upon written consent of CDC -HA to transfer the Special Limited Partner and Limited Partner interests to NCRC from Related California Corporation Partners IV SLP, L.P., the former Special Limited Partner; and, Related California Corporation Partners IV, L.P., the former Limited Partner. The Project is currently owned by Copper Hills Apartments, L.P. Southern California Housing Development Corporation of Orange is the General Partner and NCRC is the Limited Partner. Page 7 of 10 Attachment No. 1 • Entitlements NCRC has not incurred the need for entitlements. • Predevelopment Costs • Development Overhead • Capitalized Operating Reserve • Replacement Reserves • Project Timeline • Property/Asset Management/Social Services Fees/Other Fees NCRC will use net operating income and existing project reserves to pay for certain predevelopment and construction period costs prior to permanent loan conversion. NCRC and/or CPP have otherwise paid all predevelopment costs for the Project to date, which will be reimbursed by the Project at the close of construction financing. NCRC and WNC/CPP, its development partner/consultant, will be paid a developer fee from tax credit investor proceeds throughout the Project's development, construction and project stabilization. The developer fee will be restricted to the maximum allowable by CTCAC regulations. An Operating Reserve (consisting of 3 months of operating expenses and debt service) will be funded at permanent financing, subject to investor and lender requirements. A Replacement Reserve of $300 per unit per year with no annual increase will be funded from the operating budget beginning at conversion of permanent financing, subject to lender requirements. A capitalized Replacement Reserve of $200,000 will also be funded from development financing sources to supplement the Replacement Reserve to be funded from the operating budget. Closing of Financing — December 2017 Rehab Commencement — January 2018 Rehab Completion — December 2018 NCRC and its affiliates will be contracted by the tax credit limited partnership to provide various services for Project. The property management and bookkeeping fees to NCRC as well as social service fees to Hope Through Housing Foundation will be paid per the amounts and terms defined in the CDC-HA's Prorata Share section of CDC -HA Financial Participation above. In addition, a partnership management fee to the managing general partner asset management fee to the Special Limited Partner will be paid per the amounts and terms defined in CDC-HA's Prorata Share section of CDC -HA Financial Participation above. NCRC shall screen all prospective residents, to include a Page 8 of 10 Attachment No. 1 • General Contractor • Property Taxes • Subordination • Available Cash Flow Distributions • Affordability Restrictions criminal background check, credit history, third -party verification of income, and residents will execute a "crime free addendum' in the lease contract. United Renovations Specialty Group, a 3rd Party General Contractor, will be contracted by the Owner to be the general contractor and construct the improvements. NCRC will be the Managing Member of Vista Del Sol GP LLC, a Limited Liability Company that will act as Managing General Partner of the tax credit limited partnership and NCRC will apply for an annual 501(c)(3) welfare property tax exemption. As a typical requirement of lenders, the CDC -HA will subordinate the CDC -HA Loan to the construction and permanent loan per lender requirements. Subordination of the CDC -HA Loan to future debt (refinancing) will require CDC -HA approval. The existing affordability restrictions, however, will remain senior to the new construction and permanent loan financing. Available Cash Flow Distributions, as defined in the CDC- HA's Prorata Share section of CDC -HA Financial Participation, will be as follows: • 45% to CDC -HA Loan; • 45% to pay for Seller Carry -Back Loan; • 9.8% to the Limited Partner; • .10% to the Special Limited Partner; and, • .10% to the General Partner Owner agrees to make available, restrict occupancy to, and rent (a) one hundred three (103) of the Project Units to Lower Income (60% AMI) Households, and (b) twenty- seven (27) of the Project Units to Very Low Income (50% AMI) Households, all at an Affordable Rent. At least sixty- two (62) of the Housing Units rented to Lower Income Household (60% AMI) shall be one bedroom units, and at least sixteen (16) of the Housing Units rented to Very Low Income Households (50% AMI) shall be one bedroom units. No more than two units may be set aside for managers and maintenance personnel. Due to differing apartment unit utility configurations where some units have tenant -paid qas utilities (AKA "QUAD" units), the units are further differentiated by this point of Page 9 Attachment No. 1 utility set-up differentiation with no conflict with the above affordability restrictions. One Bedroom Units: 12 units @ 50% AMI; 62 units @ 60% AMI; and 4 "QUAD" (i.e. Gas Utility Allowance) units @ 60% AMI. Two Bedroom Units: 8 units @50% AMI; 1 "QUAD" units @ 50% AMI; 34 units @ 60% AMI; and 3 "QUAD" units @ 60% AMI. Three Bedroom Units: 2 "QUAD" units @ 50% AMI and 4 "QUAD" units @ 60% AMI. 2 unrestricted three bedroom units for on -site staff units. • Cost Overruns NCRC/Partnership assumes responsibility for all cost overruns during development of the Project. • Cost Savings Project cost savings will first pay any developer loans to cover cost overruns, then reduce deferred developer fee (if any) and then reduce the CDC -HA residual receipts loan. Final cost savings, if any, will be determined at permanent financing. Any reduction of the CDC -HA residual receipts loan will be in accordance with CTCAC regulations regarding public subsidy and tiebreaker decreases, if applicable. Page 10 of 10 Attachment No. 2 TITLE INSTRUCTIONS CITY OF NATIONAL CITY AND COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF TH E CITY OF NATIONAL CITY (Vista Del Sol) TO: Fidelity National Title Company 1300 Dove Street, Suite 310 Newport Beach, CA 92660 Attn: Valerie Rapp Order No. 989-23040793-F-SG4 1. Opening of Escrow. The City of National City ("City") and the Community Development Commission -Housing Authority of the City of National City ("CDC -HA") have been advised that Vista Del Sol Apartments, L.P., a California limited partnership ("Borrower") opened the above - referenced escrow ("Escrow") with you ("Escrow Agent"). The City and the CDC -HA hereby authorize and instruct you as set forth herein. 2. Deposit of Documents. Enclosed herewith are the following: (a) Substitution of Trustee and Full Reconveyance of Deeds of Trust ("Reconveyance") (b) Assignment, Assumption and Consent Agreement (Vista Del Sol -City Ground Lease) (c) Assignment, Assumption and Consent Agreement (Vista Del Sol -CDC -HA Recorded Documents) ("Recorded Documents Assumption") (d) Assignment, Assumption and Consent Agreement (Vista Del Sol -CDC -HA Loan Documents) (e) Amended and Restated Loan Agreement (f) Consolidated, Amended and Restated Promissory Note Secured by Deed of Trust (g) Amended and Restated Regulatory Agreement ("Restated Regulatory Agreement") (h) Deed of Trust, Assignment of Rents and Security Agreement ("Deed of Trust") (i) Subordination Agreement 3. Conditions to Closing. You may close the Escrow as set forth in Section 4, when, and only when you have delivered to the CDC -HA true and complete copies of all of the escrow instructions that you have received all other parties to the Escrow, including any amendments or supplemental Attachment No 2 instructions, and any assignments or demands that have been deposited with or delivered to you in connection with the Escrow. 4. Procedure for Closing. Once all of the conditions set forth in Section 3, above, have been satisfied, you shall close the Escrow as set forth in this Section 4. (a) Record the Reconveyance. (b) Record the instruments and documents against the ground lease which secure the loans form all lenders financing the construction of the project. (c) Record the Recorded Documents Assumption, Restated Regulatory Agreement and Deed of Trust in that order. 5. Delivery of Instruments and Documents. All instruments and documents that are to be delivered by Escrow Agent to the CDC -HA shall be personally delivered or sent to the CDC -HA at: c/o Walter F. Spath III, Esq. Christensen & Spath LLP 550 West C Street, Suite 1660 San Diego, CA 92101 6. Sole Instructions; Amendment. These Escrow Instructions constitute the complete and only escrow instructions of the City and the CDC -HA and shall revoke and supersede any prior oral or written instructions you may have received from the City or the CDC -HA. Either the City or the CDC -HA may revoke, cancel, waive, amend, supplement or permit deviations from, any term or condition of these Escrow Instructions in writing or by email. Any purported oral revocation, cancellation, waiver, amendment, supplement or deviation of these Escrow Instructions, shall be ineffective and invalid. Dated as of December 12, 2017 CDC -HA: Community Development Commission -Housing Authority of the City of National City By: Executive Director Approved as to form and legality: By: Deputy City Attorney Attachment No. 2 NO FEE DOCUMENT Government Code Section 27383 Recording requested by: When recorded mail to: Community Development CDC of the City of National City 140 E. 12th Street, Suite B National City, CA 91950-3312 Attention: Executive Director SUBSTITUTION OF TRUSTEE AND FULL RECONVEYANCE OF DEEDS OF TRUST Copper Hills Apartments Limited Partnership, a California limited partnership, is the trustor, Fidelity National Title Insurance Company is the original trustee, and the Community Development Commission of the Community Development Commission -Housing Authority of the City of National City ("CDC -HA") is the current beneficiary under (collectively, the Deeds of Trust"): (i) that certain Deed of Trust, dated as of February 18, 1999, which was recorded in the Official Records of San Diego County, California, on May 27, 1999, as File No. 1999- 0363599; and (ii) that certain Deed of Trust, dated as of June 1, 1999, which was recorded in the Official Records of San Diego County, California, on June 2, 1999, as File No. 1999-0382563. 1. Substitution of Trustee. The undersigned, as the sole present Beneficiary under each of the Deeds of Trust, hereby substitutes the CDC -HA, whose address is 140 East 126 Street, National City, California 91950, as Trustee in the place of said original trustee in each of the Deeds of Trust. 2. Full Reconveyance of Deeds of Trust. The CDC -HA, as Trustee, in each of the Deeds of Trust hereby reconveys to the person(s) legally entitled thereto, without warranty, all of the estate, title and interest acquired by Trustee under said Deeds of Trust in and to that real property described in the Deeds of Trust. CDC: Community Development Commission -Housing Authority of the City of National City Approved as to Form: By: By: Executive Director Deputy City Attorney Attachment No. 2 ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of San Diego On , 2017, before me, , notary public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is 'rue and correct. WITNESS my hand and official seal. Signature (Seal) Attachment No. 2 ASSIGNMENT, ASSUMPTION AND CONSENT AGREEMENT (Vista Del Sol -City Ground Lease) THIS ASSIGNMENT, ASSUMPTION AND CONSENT AGREEMENT ("Agreement") is dated as of the 12th day of December, 2017, Copper Hills Apartments Limited Partnership, a California limited partnership ("Assignor"), Vista Del Sol Apartments, L.P., a California limited partnership ("Assignee"), and the City of National City ("City"). RECITALS A. Assignor and the City are all of the current parties to that certain Ground Lease dated as of August 15, 2000. B. The Assignor desires to assign all of the Assignor's interest in the Ground Lease to the Assignee, and the Assignee desires to assume all of the Assignor's interest in the Ground Lease from and after the date hereof. C. The consent of the City is a condition precedent to the assignment and assumption of the Ground Lease. NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the City, Assignor and Assignee hereby agree as follows: 1. Assignment. Assignor assigns and transfers all of its rights, title, interest and obligations under and pursuant to the Ground Lease to Assignee concurrently with the conveyance of the Property from Assignor to Assignee. 2. Assumption. Assignee assumes and agrees to perform all of the obligations, covenants and agreements of Assignor from and after the date hereof under the Ground Lease, in the manner, at the times and in all other respects as therein provided. Assignee further agrees to be bound by all of the terms, covenants and conditions contained in the Ground Lease from and after the date hereof as though the Ground Lease had been originally made, executed and delivered by Assignee. 3. Consent. The City hereby consents to Assignor's conveyance of the Property to Assignee and the assignment of all of Assignor's rights, title, interest and obligations under and pursuant to the Ground Lease, consents to Assignee's assumption of the same, and agrees that the rights of Assignor under the Ground Lease shall inure to the benefit of Assignee. Assignor and Assignee hereby execute this Agreement, on the following express conditions and understandings: The consent of the City to the assignment and assumption as contemplated by this Agreement shall not be deemed consent to any other or subsequent conveyances of the Property, or any part thereof. Assignee shall not convey or otherwise transfer all or any part of the Property without the prior written consent of the City, which consent shall not be unreasonably withheld. Any conveyance or other transfer of all or any part of the Property without the prior written consent of the City, shall be a material breach of the Ground Lease and this Agreement. Attachment No. 2 4. General Provisions. (a) Binding Effect/No Third Party Beneficiaries. All of the terms and provisions of this Agreement shall be binding upon and inure to the benefit to the parties hereto and respective heirs, legal representatives, successors and assigns. This Agreement is made for the sole benefit and protection of the parties hereto, and their successors and assigns, and no other party shall have any right of action or right to rely hereon. (b) No Novation. Except as otherwise set forth in this Agreement, the parties agree that this Agreement is not in any way intended to, and does not, revise, amend or otherwise affect any of the terms, conditions or priority of the Ground Lease or any other agreement or document by and between the City, Assignor or Assignee, nor the enforcement thereof. The parties hereby agree the provisions of the Ground Lease and all other agreements or documents by and between the City, Assignor or Assignee shall be and remain unmodified and in full force and effect. (c) Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. (d) Signature Authority. All individuals signing this Agreement for a party which is a corporation, limited liability company, partnership or other legal entity, or signing under a power of attorney, or as a trustee, guardian, conservator, or in any other legal capacity, covenant to the others that they have the necessary capacity and authority to act for, sign and bind the respective entity or principal on whose behalf they are signing. IN WITNESS WHEREOF, this Agreement is executed to be effective as of the date first above written. ASSIGNOR: Copper Hills Apartments Limited Partnership, a California limited partnership By: Print Name: Its: [SIGNATURES CONTINUED ON FOLLOWING PAGE] Attachment No. 2 ASSIGNEE: Vista Del Sol Apartments, L.P., a California limited partnership By: Vista Del Sol GP LLC, a California limited liability company, its general partner By: National Community Renaissance of California, a California nonprofit public benefit corporation, its managing member By: Its: [SIGNATURES CONTINUED ON FOLLOWING PAGE] Attachment No. 2 City: THE COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY, By: Its: Executive Director Approved as to form and legality: By: Deputy City Attorney Attachment No. 2 ASSIGNMENT, ASSUMPTION AND CONSENT AGREEMENT (Vista Del Sol -CDC -HA Loan Documents) THIS ASSIGNMENT, ASSUMPTION AND CONSENT AGREEMENT ("Agreement") is dated as of the 12th day of December, 2017, Copper Hills Apartments Limited Partnership, a California limited partnership ("Assignor"), Vista Del Sol Apartments, L.P., a California limited partnership ("Assignee"), and the Community Development Commission -Housing Authority of the City of National City ("CDC -HA"). RECITALS A. Assignor and the CDC -HA are all of the current parties to (collectively, the "CDC -HA Loan Documents"): (i) that certain Affordable Housing Agreement dated as of December 7, 1988; (ii) that certain Residual Receipts Promissory Note, dated February 18, 1999, in the original principal amount of $2,400,000.00; (iii) that certain Residual Receipts Promissory Note (Secured by Deed of Trust), dated June 1, 1999, in the original principal amount of $4,454,037.07. B. The Assignor desires to assign all of the Assignor's interest in the CDC -HA Loan Documents to the Assignee, and the Assignee desires to assume all of the Assignor's interest in the CDC -HA Loan Documents from and after the date hereof. C. The consent of the CDC -HA is a condition precedent to the assignment and assumption of the CDC -HA Loan Documents. NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the CDC -HA, Assignor and Assignee hereby agree as follows: 1. Assignment. Assignor assigns and transfers all of its rights, title, interest and obligations under and pursuant to the CDC -HA Loan Documents to Assignee concurrently with the conveyance of the Property from Assignor to Assignee. 2. Assumption. Assignee assumes and agrees to perform all of the obligations, covenants and agreements of Assignor from and after the date hereof under the CDC -HA Loan Documents, in the manner, at the times and in all other respects as therein provided. Assignee further agrees to be bound by all of the terms, covenants and conditions contained in the CDC -HA Loan Documents from and after the date hereof as though the CDC -HA Loan Documents had been originally made, executed and delivered by Assignee. 3. Consent. The CDC -HA hereby consents to Assignor's conveyance of the Property to Assignee and the assignment of all of Assignor's rights, title, interest and obligations under and pursuant to the CDC -HA Loan Documents, consents to Assignee's assumption of the same, and agrees that the rights of Assignor under the CDC -HA Loan Documents shall inure to the benefit of Assignee. Assignor and Assignee hereby execute this Agreement, on the following express Attachment No. 2 conditions and understandings: The consent of the CDC -HA to the assignment and assumption as contemplated by this Agreement shall not be deemed consent to any other or subsequent conveyances of the Property, or any part thereof. Assignee shall not convey or otherwise transfer all or any part of the Property without the prior written consent of the CDC -HA, which consent shall not be unreasonably withheld. Any conveyance or other transfer of all or any part of the Property without the prior written consent of the CDC -HA, shall be a material breach of the CDC -HA Loan Documents and this Agreement. 4. General Provisions. (a) Binding Effect/No Third Party Beneficiaries. All of the terms and provisions of this Agreement shall be binding upon and inure to the benefit to the parties hereto and respective heirs, legal representatives, successors and assigns. This Agreement is made for the sole benefit and protection of the parties hereto, and their successors and assigns, and no other party shall have any right of action or right to rely hereon. (b) No Novation. Except as otherwise set forth in this Agreement, the parties agree that this Agreement is not in any way intended to, and does not, revise, amend or otherwise affect any of the terms, conditions or priority of the CDC -HA Loan Documents or any other agreement or document by and between the CDC -HA, Assignor or Assignee, nor the enforcement thereof. The parties hereby agree the provisions of the CDC -HA Loan Documents and all other agreements or documents by and between the CDC -HA, Assignor or Assignee shall be and remain unmodified and in full force and effect. (c) Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. (d) Signature Authority. All individuals signing this Agreement for a party which is a corporation, limited liability company, partnership or other legal entity, or signing under a power of attorney, or as a trustee, guardian, conservator, or in any other legal capacity, covenant to the others that they have the necessary capacity and authority to act for, sign and bind the respective entity or principal on whose behalf they are signing. IN WITNESS WHEREOF, this Agreement is executed to be effective as of the date first above written. ASSIGNOR: Copper Hills Apartments Limited Partnership, a California limited partnership By: Print Name: Its: [SIGNATURES CONTINUED ON FOLLOWING PAGEI Attachment No. 2 ASSIGNEE: Vista Del Sol Apartments, L.P., a California limited partnership By: Vista Del Sol GP LLC, a California limited liability company, its general partner By: National Community Renaissance of California, a California nonprofit public benefit corporation, its managing member By: Its: [SIGNATURES CONTINUED ON FOLLOWING PAGE] Attachment No. 2 CDC -HA: THE COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY, By: Its: Executive Director Approved as to form and legality: By: Deputy City Attorney Attachment No. 2 NO FEE DOCUMENT Government Code Section 27383 Recording requested by: When recorded mail to: Community Development Commission of the City of National City 140 E. 12th Street, Suite B National City, CA 91950-3312 Attention: Executive Director ASSIGNMENT, ASSUMPTION AND CONSENT AGREEMENT (Vista Del Sol -CDC -HA Recorded Documents) THIS ASSIGNMENT, ASSUMPTION AND CONSENT AGREEMENT ("Agreement") is dated as of the 12th day of December, 2017, Copper Hills Apartments Limited Partnership, a California limited partnership ("Assignor"), Vista Del Sol Apartments, L.P., a California limited partnership ("Assignee"), and the Community Development Commission -Housing Authority of the City of National City ("CDC -HA"). RECITALS A. Assignor and the CDC -HA are all of the current parties to: (i) that certain Regulatory Agreement and Declaration of Restrictive Covenants dated as of December 7, 1998, and recorded in the Office of the County Recorder for the County of San Diego on December 11, 1998 as Instrument Number 1998-0807600 ("Regulatory Agreement"); and (ii) that certain Operation and Maintenance Agreement dated as of December 7, 1998, and recorded in the Office of the County Recorder for the County of San Diego on December 11, 1998 as Instrument Number 1998-0807604 ("Operation Agreement"). B. Assignor desires to convey the real property ("Property") described in the Regulatory Agreement and the Operation Agreement to Assignee, and Assignor desires to assign its interests in the Regulatory Agreement and the Operation Agreement to Assignee, and Assignee desires to assume all of the interest, rights and responsibilities of Assignor under the Regulatory Agreement and the Operation Agreement from and after the date hereof. C. The consent of the CDC -HA is a condition precedent to conveyance of the Property and the assignment and assumption of the Regulatory Agreement and the Operation Agreement. Attachment No. 2 NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the CDC -HA, Assignor and Assignee hereby agree as follows: 1. Assignment. Assignor assigns and transfers all of its rights, title, interest and obligations under and pursuant to the Regulatory Agreement and the Operation Agreement to Assignee concurrently with the conveyance of the Property from Assignor to Assignee. 2. Assumption. Assignee assumes and agrees to perform all of the obligations, covenants and agreements of Assignor from and after the date hereof under the Regulatory Agreement and the Operation Agreement, in the manner, at the times and in all other respects as therein provided. Assignee further agrees to be bound by all of the terms, covenants and conditions contained in the Regulatory Agreement and the Operation Agreement from and after the date hereof as though the Regulatory Agreement and the Operation Agreement had been originally made, executed and delivered by Assignee. 3. Consent. The CDC -HA hereby consents to Assignor's conveyance of the Property to Assignee and the assignment of all of Assignor's rights, title, interest and obligations under and pursuant to the Regulatory Agreement and the Operation Agreement, consents to Assignee's assumption of the same, and agrees that the rights of Assignor under the Regulatory Agreement and the Operation Agreement shall inure to the benefit of Assignee. Assignor and Assignee hereby execute this Agreement, on the following express conditions and understandings: The consent of the CDC -HA to the assignment and assumption as contemplated by this Agreement shall not be deemed consent to any other or subsequent conveyances of the Property, or any part thereof. Assignee shall not convey or otherwise transfer all or any part of the Property without the prior written consent of the CDC -HA, which consent shall not be unreasonably withheld. Any conveyance or other transfer of all or any part of the Property without the prior written consent of the CDC -HA, shall be a material breach of the Regulatory Agreement, the Operation Agreement and this Agreement. 4. General Provisions. (a) Binding Effect/No Third Party Beneficiaries. All of the terms and provisions of this Agreement shall be binding upon and inure to the benefit to the parties hereto and respective heirs, legal representatives, successors and assigns. This Agreement is made for the sole benefit and protection of the parties hereto, and their successors and assigns, and no other party shall have any right of action or right to rely hereon. (b) No Novation. Except as amended in a particular agreement or document, the parties agree that this Agreement is not in any way intended to, and does not, revise, amend or otherwise affect any of the terms, conditions or priority of the Regulatory Agreement, the Operation Agreement or any other agreement or document by and between the CDC -HA, Assignor or Assignee, nor the enforcement thereof. The parties hereby agree the provisions of the Regulatory Agreement, the Operation Agreement and all other agreements or documents by and between the CDC -HA, Assignor or Assignee shall be and remain unmodified and in full force and effect. Attachment No. 2 (c) Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. (d) Signature Authority. All individuals signing this Agreement for a party which is a corporation, limited liability company, partnership or other legal entity, or signing under a power of attorney, or as a trustee, guardian, conservator, or in any other legal capacity, covenant to the others that they have the necessary capacity and authority to act for, sign and bind the respective entity or principal on whose behalf they are signing. IN WITNESS WHEREOF, this Agreement is executed to be effective as of the date first above written. ASSIGNOR: Copper Hills Apartments Limited Partnership, a California limited partnership By: Print Name: Its: ]SIGNATURES CONTINUED ON FOLLOWING PAGE] Attachment No. 2 ASSIGNEE: Vista Del Sol Apartments, L.P., a California limited partnership By: Vista Del Sol GP LLC, a California limited liability company, its general partner By: National Community Renaissance of California, a California nonprofit public benefit corporation, its managing member By: Its: [SIGNATURES CONTINUED ON FOLLOWING PAGE] Attachment No. 2 CDC -HA: THE COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY, a public body corporate and politic By: Its: Executive Director Approved as to form and legality: By: Deputy City Attorney Attachment No. 2 ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of San Diego On , 2017, before me, , notary public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under penalty of perjury under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature (Seal) Attachment No. 2 State of California County of San Diego On ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. , 2017, before me, notary public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under penalty of perjury under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature (Seal) Attachment No. 2 ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California ) County of San Diego ) On , 2017, before me, , notary public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under penalty of perjury under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature (Seal) Attachment No. 2 CONSOLIDATED, AMENDED AND RESTATED PROMISSORY NOTE SECURED BY DEED OF TRUST (Vista Del Sol Apartments) $7.407,795.08 Copper Hills Apartments Limited Partnership, a California limited partnership ("Original Borrower") executed the following in favor of the Community Development Commission of the City of National City ("Original Lender"), collectively, the "Original Notes": 1) Residual Receipts Promissory Note, dated February 18, 1999, in the original principal amount of $2,400,000.00. 2) Residual Receipts Promissory Note (Secured by Deed of Trust), dated June 1, 1999, in the original principal amount of $4,454,037.07. Concurrently herewith, Vista Del Sol Apartments, L.P., a California limited partnership ("Borrower") is assuming the rights and obligations of the Original Borrower under the Original Notes. The Community Development Commission -Housing Authority of the City of National City ("Lender") elected to retain the housing assets of and functions previously performed by the Original Lender pursuant to California Health and Safety Code Section 34176, and thereby, by operation of law, the Lender assumed the rights and obligations of the Original Lender with respect to the Original Notes. The Lender and Borrower hereby consolidate the two (2) Original Notes into this single Consolidated Note and the Commission and Maker hereby amend and restate the same into this Consolidated, Amended and Restated Promissory Note Secured by Deed of Trust ("Note"). FOR VALUE RECEIVED, and in consideration of the Amended and Restated Loan Agreement of even date herewith between Borrower and Lender (the "Loan Agreement"), Borrower, with its principal office at 9421 Haven Avenue, Rancho Cucamonga, CA 91730, hereby promises to pay to the order of the Lender, with an office located at 140 E. 12th Street, Suite B, National City, CA 91950, a principal amount equal to $7,407,795.08 ("Loan"). The Loan shall bear simple interest at the rate of 3%. All interest will be computed based on a 365- day year and applied to the actual number of days elapsed. The obligation of Borrower and Lender with respect to the Loan are subject to the terms of (a) that Amended and Restated Loan Agreement between Borrower and Lender (the "Loan Agreement"), (b) this Consolidated, Amended and Restated Promissory Note Secured by Deed of Trust (the "Note"), and (c) that Deed of Trust, Assignment of Rents, and Security Agreement (the "Deed of Trust") recorded on the Property which secures payment of the Loan. Borrower also promises to pay to the order of Lender accrued interest on the principal balance from time to time remaining unpaid, as well as interest accrued to date, as provided for in the Loan Agreement. Attachment No. 2 1. BORROWER'S OBLIGATION. This Note evidences the obligation of Borrower to Lender for the repayment of funds disbursed to the Original Borrower by Lender to finance the development of the housing project in the City of National City described in the Loan Agreement. Upon execution of this Note, the Original Notes shall be cancelled and returned to Borrower. 2. AMOUNT AND TIME OF PAYMENT. Until such time as the Loan Funding Reserve is depleted, Borrower shall make annual payments under this Note, equal to the greater of: (i) $250,000.00 (provided that if the amount in the Loan Funding Reserve is less than $250,000.00, then as much as is in the Loan Funding Reserve at such time); or (ii) the Lender's Prorata Share of the Available Cash Flow, as defined below. To the extent the Lender's Prorata Share of the Available Cash Flow in any calendar year is less than $250,000.00, then funds may be disbursed from the Loan Funding Reserve to the Lender in an amount equal to the difference between $250,000.000 and the Lender's Prorata Share of the Available Cash Flow. At such time as all funds in the Loan Funding Reserve have been disbursed to the Lender, as set forth in the immediately preceding sentence, and each calendar year thereafter, the Borrower shall make annual payments under this Note, equal to the Lender's Prorata Share of the Available Cash Flow. Payment for each calendar year shall be made no later than April 15 of the following year. Borrower shall provide Lender, no later than February 15, with an accounting, prepared by an independent auditor, of the Operating Revenues and Operating Expenses, as defined below, for the previous calendar year. "Lender's Prorata Share" means the portion of Available Cash Flow to which Lender is entitled, which shall be split among Project lenders with surplus cash flow loans based on relative loan amounts. For this Note, Lender's Prorata Share shall be 45%. "Available Cash Flow" means 45% of the annual Operating Revenues minus the annual Operating Expenses for the property. "Operating Revenues" shall mean all income derived from the Property, and shall include, without limitation: (1) rents (including rent on common space within the Property); (2) rent subsidy payments received on behalf of tenants; (3) interest on income other than interest on reserve accounts approved by Lender; and (4) receipts from laundry, parking, vending, or other services in which a fee is charged. "Operating Expenses" shall mean: (1) all direct costs and expenses necessary to operate the Property as approved by Lender, including but not limited to an annual property management fee of $7,328.64 ($55.52 per unit per month), increasing by 3% per annum and a bookkeeping fee of $9.50 per unit per month; (2) debt service on any loans secured by the Property, provided that such loans have been used to acquire the Property or develop or improve the Project (or to refinance loans used for Project acquisition, development or improvement), have been approved by Lender, and are secured by a deed of trust on the Property that is senior in priority to the Deed of Trust; (3) reasonable payments, approved by Lender, to reserves for operating contingencies, replacement of capital items, and other reserve uses as approved by Lender; (4) a general partner asset management fee of $15,000 increasing annually by 3% (which shall accrue to the extent not paid), an annual social service fee of $36,000 increasing annually by 3% and limited partner asset management fee of $6,500 increasing annually by 3%; (5) any deferred development fee; (6) payments of tax credit adjusters to the limited partners of the Maker; (7) repayment of operating loans made by the general partner of the Maker and (8) repayment of "Voluntary Funding" loans, as defined in Section 7.7 of the Attachment No. 2 Maker's partnership agreement, to the extent any such "Voluntary Funding" loan is made to pay Operating Expenses. Notwithstanding the preceding provision, Borrower shall pay to the order of Lender the full amount of the outstanding principal under this Note and the Loan Agreement together with all accrued but unpaid interest thereon, on the earliest of: (a) December 31, 2073; (b) the date the Property is sold (specifically excluding a transfer of the Property to an affiliate of Borrower's managing general partner following the expiration of the tax credit compliance period); or (c) an Event of Default by Borrower as defined in the Loan Agreement which has not been cured in the manner and time provided in the Loan Agreement. Notwithstanding the above, payments shall also be due from syndication proceeds, leveraged funds, and other funds received by Borrower or an affiliate as required by Lender under the syndication provision of the Loan Agreement. 3. PLACE AND MANNER OF PAYMENT. All amounts due and payable under this Note and the Loan Agreement are payable at the office of Lender as set forth above, or at such other place as Lender may designate to Borrower in writing from time to time, in any currency of the United States which on the date of payment is legal tender for the payment of public and private debts. 4. APPLICATION OF PAYMENTS. All payments received on account of this Note shall be first applied to accrued interest and the remainder shall be applied to the reduction of principal; except that if Lender shall have made additional advances under the terms of the Loan Documents (as that term is defined in the Loan Agreement) and such advances have not been repaid, any payments received by Lender, at its option, may be applied first to the repayment of such advances and interest thereon. 5. PREPAYMENT OF LOAN. No prepayment penalty will be charged to Borrower for payment of any portion of this Note prior to the end of the Loan term. 6. WAIVERS. Presentment, notice of dishonor, and protest are waived by all makers, sureties, guarantors, and endorsers of this Note. 7. DEFAULT AND ACCELERATION. This Note is secured by a Deed of Trust. All provisions in the Deed of Trust and the Loan Agreement are hereby made a part of this Note. Borrower agrees that the unpaid balance of the principal amount of this Note, together with all accrued interest thereon and charges owing, shall, at the option of Lender, become immediately due and payable upon any Event of Default as defined in the Loan Agreement which has not been cured pursuant to that Agreement, including without limitation the failure of Borrower to make any payment when due. Upon any Event of Default and failure to cure, Lender may exercise any other right or remedy permitted under the Loan Documents. 8. TRANSFER OF PROPERTY OR PROJECT AND ACCELERATION. Borrower may not make or permit any sale, agreement to sell, assignment, conveyance, lease, or other transfer of any part of the Project or the Property, including the sale of any general or limited partnership interests, the removal of any general partner, or any substantial change in Attachment No. 2 Project control (collectively referred to as "Transfers"), except as provided for in the Loan Agreement. Any unauthorized Transfer shall constitute an Event of Default and shall be grounds for acceleration of the Loan. 9. LIMITED RECOURSE. Except as provided for below, this Note is a nonrecourse obligation of Borrower. Neither Borrower or its partners, nor any director or employee of Borrower or its partners shall have any personal liability for repaying the principal or interest of the Loan. The sole recourse of Lender for repayment of the principal and interest shall be the exercise of Lender's rights against the Property. This limitation shall not be applicable in the event of actual fraud by Borrower, or any material misrepresentation by Borrower to Lender, in connection with the Loan. Furthermore, this limitation shall not be applicable to the extent of any loss incurred by Lender due to (a) misapplication by Borrower of any Loan proceeds, (b) any willful or intentional damage caused by Borrower to a Property, or (c) the presence or release of any Hazardous Materials on or in a Property. 10. BINDING UPON SUCCESSORS. All provisions of this Note shall be binding upon and inure to the benefit of the heirs, administrators, executors, successors -in -interest, transferees, and assigns of Borrower and Lender; provided, however, that this section does not waive the prohibition in the Loan Agreement on assignment of the Loan by Borrower without Lender's consent. 11. ASSIGNMENT AND ASSUMPTION. Borrower may not assign any of its interests under this Note to any other party, except as specifically permitted under the terms of the Loan Agreement. Any unauthorized assignment shall be void. 12. DEFINITIONS. Capitalized terms not defined in this Note shall have the same meaning as defined in the Loan Agreement. 13. GOVERNING LAW. This Note shall be interpreted under and governed by the laws of the State of California, except for those provisions relating to choice of law and those provisions preempted by federal law. 14. LOAN AGREEMENT CONTROLS. In the event that any provisions of this Note and the Loan Agreement conflict, the terms of the Loan Agreement shall control. 15. SEVERABILITY. Every provision of this Note is intended to be severable. If any provision of this Note is held invalid, illegal, or unenforceable by a court of competent jurisdiction, the validity, legality, and enforceability of the remaining provisions shall not be affected or impaired. 16. TIME. Time is of the essence in the performance of Borrower's obligations under this Note. 17. ATTORNEYS' FEES AND COSTS. In the event of any Event of Default, or any legal action is commenced to interpret or to enforce the terms of this Note, the prevailing party in Attachment No. 2 any such action shall be entitled to recover all reasonable attorneys' fees and costs incurred in such action. In addition, Borrower agrees to pay Lender all reasonable costs incurred in collection of amounts due under this Note which are not paid by the due date as specified herein, whether or not a legal action has been filed. 18. WAIVER. Any waiver by Lender of any obligation in this Note must be in writing. No waiver shall be implied from any failure of Borrower to take, or any delay or failure by Lender to take action on any breach or default by Borrower or to pursue any remedy allowed under this Note or applicable law. Any extension of time granted to Borrower to perform any obligation under this Note shall not operate as a waiver or release from any of its obligations under the Note. Borrower hereby waives all defenses and pleas on the grounds of any extensions of the time for repayment of any amounts due under this Note, unless Lender has granted such extensions in writing. Consent by Lender to any act or omission by Borrower shall not be construed to be a consent to any other act or omission or to waive the requirement for Lender's written consent to future waivers. 19. AMENDMENTS AND MODIFICATIONS. Any amendments or modifications to this Note must be in writing, and shall be effective only if executed by both Borrower and Lender. [SIGNATURES BEGIN ON FOLLOWING PAGE] Attachment No. 2 Dated as of December 12, 2017. "BORROWER" VISTA DEL SOL APARTMENTS, L.P., a California limited partnership By: Vista Del Sol GP LLC, a California limited liability company, its general partner By: National Community Renaissance of California, a California nonprofit public benefit corporation, its manager By: Its: [SIGNATURES CONTINUED ON FOLLOWING PAGE] Attachment No. 2 CDC: THE COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY, By: Its: Executive Director Approved as to form and legality: By: Deputy City Attorney Attachment No. 2 AMENDED AND RESTATED LOAN AGREEMENT VISTA DEL SOL APARTMENTS $7,407,795.08 LOAN THE COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY, LENDER AND VISTA DEL SOL APARTMENTS, L.P., BORROWER Attachment No. 2 AMENDED AND RESTATED LOAN AGREEMENT This Amended and Restated Loan Agreement (the "Agreement") is dated as of December 12, 2017, between the Community Development Commission -Housing Authority of the City of National City ("Lender" or "City"), a public body, corporate and politic, and Vista Del Sol Apartments, L.P. ("Borrower"), a California limited partnership. RECITALS This Agreement is entered into based on the following facts and understandings of the parties: A. Borrower proposes to assume and modify the ownership structure of Vista Del Sol Apartments, a 132-unit affordable rental housing development at 1545 Q Avenue, in National City, CA (the "Property"). B. The Community Development Commission of the City of National City ("Original Lender"), and Copper Hills Apartments Limited Partnership, a California limited partnership ("Prior Owner"), entered into that certain Affordable Housing Agreement dated as of December 7, 1988 ("Affordable Housing Agreement"). Pursuant to which the Prior Owner received a secured loan from Original Lender, from the Original Lender's Low and Moderate Income Housing Fund and from HOME funds in an original principal amount of $2,400,000, secured by deed of trust recorded on the property with the San Diego County Recorder on May 27, 1999, as Instrument No. 1999-0363599 ("Former RR Loan"), which is more particularly described in the Affordable Housing Agreement. The Former RR Loan funds have been fully disbursed. $771,658 in principal remains outstanding and $3,797 in interest has accrued as of December 12, 2017, under the Former RR Loan. C. The Prior Owner received a second secured loan from the Original Lender from the Original Lender's issuance of tax allocation bond proceeds in an original principal amount of $4,454,037.07, secured by deed of trust recorded on the property with the San Diego County Recorder on June 2, 1999, as Instrument No. 1999-0382563 ("Former Rehab Loan"), which is more particularly described in the Affordable Housing Agreement. The Former Rehab Loan funds have been fully disbursed. $4,454,037 in principal remains outstanding and $2,349,504 in interest has accrued as of December 12, 2017, under the Former Rehab Loan. The Former Rehab Loan together with the Former RR Loan, shall be referred to herein together, as the "Former Loan." D. The Lender elected to retain the housing assets of and functions previously performed by the Original Lender pursuant to California Health and Safety Code Section 34176, and thereby, by operation of law, the Lender assumed the rights and obligations of the Original Lender with respect to the Affordable Housing Agreement. E. Concurrently herewith the Borrower is acquiring the Property from Prior Owner, the Borrower is assuming all of the rights and liabilities of the Original Owner with respect to the Affordable Housing Agreement and with respect to the Consolidated, Amended and Restated Promissory Note, as defined below. The Lender and Borrower desire to amend and restate the Affordable Housing Agreement in its entirety, as provided herein. Concurrently with this Agreement, the promissory notes for the Former Loan are being consolidated, amended and restated into a single Amended and Restated Promissory Note which will be executed by Borrower in the original principal amount of $7,407,795.08 ("Loan"). Each deed of trust securing the Former Loan is being reconveyed, and a new Deed of Trust securing the Loan is Attachment No. 2 being executed and recorded against the Property. The previous regulatory agreements and restrictive covenant executed in connection with the Former Loan will be amended and restated by Borrower and Lender concurrently with this Agreement and recorded against the Property. These instruments are intended to secure Lender's continuing interest as a governmental entity in the affordability and habitability of the Property, as well as to secure performance of other covenants contained in such agreements. NOW, THEREFORE, in consideration of the foregoing recitals (which are hereby incorporated into this Agreement) and the covenants and mutual obligations contained in this Agreement, and in reliance on the representations and warranties set forth herein, Borrower and Lender hereby amend and restate the Affordable Housing Agreement in its entirety and agree as follows: DEFINITIONS 1. DEFINED TERMS. The following terms and their derivatives have the meanings set forth below wherever used in this Loan Agreement, attached Exhibits, or documents incorporated into this Loan Agreement by reference: "Budget" means that budget for the Project attached as Exhibit B, incorporated herein by reference. "Deed of Trust" means that Deed of Trust, Assignment of Rents, and Security Agreement recorded on the Property as security for the Loan by Borrower as trustor with Lender as beneficiary, as well as any amendments to, modifications of, and restatements of the deed of Trust. The terms of the Deed of Trust are hereby incorporated into this Agreement by this reference. Copies of the Loan Documents shall not be attached to and recorded as part of the Deed of Trust, but any breach of or misrepresentation under the Loan Documents shall, upon the expiration of any applicable notice and cure period(s), constitute an event of default under the Deed of Trust. "Eligible Costs" means those Project costs associated with the low and very low income affordable component of the Project. In addition, other items may be Eligible Costs if approved in writing by Lender. "Hazardous Materials" means any hazardous or toxic substances, materials, wastes, pollutants, or contaminants which are defined, regulated, or listed as "hazardous substances," "hazardous wastes," "hazardous materials," "pollutants," "contaminants," or "toxic substances," under applicable Hazardous Materials Laws, including without limitation petroleum and petroleum byproducts, flammable explosives, urea formaldehyde insulation, radioactive materials, asbestos, and lead. Hazardous Materials do not include substances that are used or consumed in the normal course of developing, operating, or occupying a housing project, to the extent and degree that such substances are stored, used, and disposed of in the manner and in amounts that are consistent with normal practice and legal standards. "Hazardous Materials Laws" means: the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. § 9601, et seq. ("CERCLA"); the Hazardous Materials Transportation Act, 49 U.S.C. § 1801 et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et seq. ("RCRA"); the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq.; the Clean Water Act, 33 U.S.C. § 1251 et seq.; the California Hazardous Waste Control Act, Health and Safety Code § 25100 et seq. the California Hazardous Substance Account Act, Health and Safety Code § 25330 et seq.; the California Safe Drinking Water and Toxic Enforcement Act, Health and Safety Code § Attachment No. 2 25249.5 et seq.; California Health and Safety Code § 25280 et seq. (Underground Storage of Hazardous Substances); the California Hazardous Waste Management Act, Health and Safety Code § 25170.1 et seq.; California Health and Safety Code § 25501 et seq. (Hazardous Materials Release Response Plans and Inventory); or the California Porter -Cologne Water Quality Control Act, Water Code § 13000 et seq., all as amended, or any other federal, state or local statute, law, ordinance, resolution, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning any hazardous, toxic or dangerous waste, substance, or material, as now or any time hereafter in effect. "Limited Partners" means WNC California Holding, LLC, a California limited liability company, as investor limited partner, and WNC Housing, L.P., a California limited partnership as special limited partner. "Loan" means the loan of funds from Lender to Borrower, all of which have been fully disbursed, for the Project pursuant to this Agreement, consisting of the Former Loan that has been assumed under this Loan Agreement. "Loan Documents" means collectively this Amended and Restated Loan Agreement, the Deed of Trust, and the Consolidated, Amended and Restated Note, as they may be amended, modified, or restated from time to time, along with all exhibits and attachments to these documents. "Loan Funding Reserve" means the reserve in the amount of $1,200,000.00, $500,000 of which the Borrower shall fund at closing and $700,000 of which Borrower shall fund at permanent loan conversion. The Loan Funding Reserve shall be maintained in a separate account in the name of the Borrower, provided that no disbursements from the Loan Funding Reserve shall be made without the express written consent of the Lender. The Borrower shall account to the Lender for any monies expended from the reserves. "Note" or "Consolidated, Amended and Restated Note" mean the Consolidated, Amended and Restated Promissory Note executed by Borrower in favor of Lender evidencing the Loan, which is secured by the Deed of Trust, as well as any amendments to or modifications of the Note. The terms of the Notes are hereby incorporated into this Agreement by this reference. "Partnership Agreement" means the Amended and Restated Agreement of Limited Partnership of the Borrower dated on or about the date hereof, as amended from time to time. "Project" means the rehabilitation of the Property for residential and other uses as set forth in the attached Exhibit D, incorporated herein by reference. "Project Unit" means any housing unit developed on the Property as part of the Project. "Property" means all or any portion of the real property described in the attached Exhibit A, incorporated herein by reference, and any buildings or improvements now or hereafter situated on this real property. "Replacement Reserve" has the meaning set forth in Section 17 of the Regulatory Agreement. "Regulatory Agreement" or "Amended and Restated Regulatory Agreement" mean that Amended and Restated Regulatory Agreement executed by Borrower and Lender and recorded Attachment No. 2 against the Property contemporaneous with this Loan, which, inter alia, restricts the rents and occupancy of Project Units, as well as any amendments to or modifications of said Regulatory Agreement. "Schedule" means the schedule for submissions and Project development set forth in the attached Exhibit E, incorporated herein by reference. TERMS OF LOAN 2. LOAN ASSUMPTION. Notwithstanding the assumption by Borrower of the following documents, the parties hereby acknowledge and agree that the Affordable Housing Agreement, the promissory notes for the Former Loan, each deed of trust securing the Former Loan and the previous regulatory agreements and restrictive covenant executed in connection with the Former Loan (the "Preexisting Loan Documents") are of no further force and effect and to the extent of a conflict between the Preexisting Loan Documents and the Loan Documents, the Loan Documents shall control. 3. INTEREST. Starting on the date of this Agreement, this Loan shall bear simple interest at the rate equal to 3% per annum. 4. SECURITY. The Loan shall be secured by the Deed of Trust on the Property. 5. TERM OF LOAN. The Loan shall be repaid as provided for in the Note. 6. PREPAYMENT OF LOAN. No prepayment penalty will be charged to Borrower for payment of any portion of the Loan amount prior to the end of the Loan term. However, any prepayment of the Loan shall not affect Borrower's obligations under the Regulatory Agreement, which shall remain in full force and effect for the entire term of the Regulatory Agreement. 7. LIMITED RECOURSE. Except as provided below, this Loan is a nonrecourse obligation of Borrower. Neither Borrower nor its partners or members, nor any director or employee of Borrower or its partners or members, shall have any personal liability for repaying the principal or interest of the Loan. The sole recourse of Lender for repayment of the principal and interest shall be the exercise of Lender's rights with respect to the Property, as more specifically described in of the Deed of Trust. Notwithstanding the foregoing, the Loan shall be recourse to Borrower in the event of actual fraud by Borrower, or any material misrepresentation by Borrower to Lender, in connection with the Loan. Furthermore, Borrower shall be liable to Lender for any loss incurred by Lender due to (a) misapplication by Borrower of any Loan proceeds, (b) any willful or intentional damage caused by Borrower to the Property, or (c) the presence or release of any Hazardous Materials on or in the Property. CONDITIONS TO CLOSING 8. CONDITIONS PRECEDENT TO CLOSING. Lender is not obligated to close the Loan until all of the following conditions precedent have been satisfied: A. Borrower has executed and delivered the Note to Lender, and has executed and recorded the Deed of Trust and Regulatory Agreement on the Property. Attachment No. 2 B. There is no Event of Default by Borrower, nor any act, failure, omission or condition that would constitute an Event of Default (to the best of Lender's knowledge: (i) no Event of Default has occurred; and (ii) no event of omission has transpired that would with the passage of time result in an Event of Default). C. Lender is reasonably assured that rehabilitation of the Project would be consistent with the rules and regulations of all outside funding sources for the Loan, including HUD, and all other applicable legal standards. D. Borrower has timely delivered to Lender all documents required by the Loan Documents and the Regulatory Agreement, including evidence of insurance coverage, all permits, licenses, and approvals required to rehabilitate the portion (including appropriate environmental review), and a construction schedule satisfactory to Lender, and has complied with all reporting requirements set forth in this Agreement. E. There are no outstanding mechanics liens or stop notices related to the Property, and Borrower has furnished to Lender full waivers or releases of lien claims if required by Lender. F. Lender is satisfied that the fmancing for development of the Project for which Borrower has received funds or firm commitments for funds, are sufficient in Lender's reasonable determination to complete development of the Project and satisfy all of the covenants contained in the Loan Documents and the Regulatory Agreement. G. Borrower has submitted evidence reasonably satisfactory to Lender of firm rehabilitation and/or mortgage financing commitments. PROJECT DEVELOPMENT 9. DEVELOPMENT OBLIGATIONS. Borrower must develop the Project in accordance with the Plans and Specifications and that Project description attached as Exhibit D, as the Plans and Specifications and Project description may be modified pursuant to this Agreement. 10. CHANGES IN FINANCING. Borrower must promptly inform Lender of any changes in the amount, terms, or sources of financing or funding for the Project. 11. COMMENCEMENT OF REHABILITATION. Borrower must commence rehabilitation of the Project by the commencement date specified in the Schedule (the "Commencement Date"). For purposes of this Agreement, the date rehabilitation is commenced shall be considered the date that Borrower's contractor has begun substantial demolition or rehabilitation work on the Project. 12. COMPLETION OF REHABILITATION. Following commencement of rehabilitation, Borrower must diligently prosecute the rehabilitation of the Project to completion as evidenced by the issuance of a certificate of occupancy, or its substantial equivalent, such as the issuance of a notice of completion and final signed -off building permits, by the City of National City. Borrower must complete rehabilitation of the Project by that completion date specified in the Schedule (the "Completion Date"). 13. SCHEDULING AND EXTENSIONS OF TIME. Borrower is responsible for coordinating and scheduling the work to be performed so that commencement and completion of Attachment No. 2 Rehabilitation of the Project will take place in conformance with this Agreement. Lender may extend the time for commencement or completion in its sole discretion in writing if it determines that delay in the progress of work is not attributable to the negligence of Borrower and that such delay was due to causes beyond the control of Borrower. Any time extension granted to Borrower to enable Borrower to complete the work shall not constitute a waiver of any other rights Lender has under this Agreement. 14. CONSTRUCTION BONDS. Prior to commencement of rehabilitation of the Project, Borrower shall procure and deliver to Lender copies of a labor and material (payment) bond and a performance bond, or a dual bond which covers both payment and performance obligations, with respect to the rehabilitation of the Project in a penal sum each of not less than one hundred percent (100%) of the scheduled cost of rehabilitation. Such bonds must be issued by a company which is authorized to transact surety insurance in California and which has assets exceeding its liabilities in an amount equal to or in excess of the bond amount. The bonds shall name Lender as a co -obligee or assignee. Borrower shall record the payment bond with the San Diego County Recorder, and shall submit proof of recordation to Lender. In lieu of such bonds, a letter of credit in the sole name and possession of Lender in the penal amount and in a form acceptable to Lender may be substituted. 15. CONTRACTS AND SUBCONTRACTS. All rehabilitation work and professional services for the Project must be performed by persons or entities licensed or otherwise authorized to perform the applicable rehabilitation work or service in the State of California. Each contractor, subcontractor, and professional service provider doing work on the Project must have a current City of National City Business Tax Certificate, if required under local law. All contracts entered into for Project development must be the result of either competitive or negotiated bids. For negotiated bids, the contractor shall be selected through a competitive request for qualification process or other process reasonably satisfactory to Lender. Borrower represents that it has submitted to Lender copies of all construction, consultant and professional services contracts and subcontracts entered into to date for predevelopment or development work on the Project. As a precondition to closing the Loan, the general contractor for the Project (if a general construction contract for the Project has been executed), as well as any other construction contractors or subcontractors that might be designated by Lender, must execute a Construction Contract Addendum, a form of which is attached to this Agreement as Exhibit G. Borrower must submit to Lender all future professional services contracts and construction contracts for predevelopment or development work on the Project, as well as any amendments to said contracts. Lender shall have the right to review and approve any such contract or amendment prior to execution, if the maximum contract amount exceeds $5,000. As a precondition to approval, the general contractor, as well as any other construction contractors or subcontractors that might be designated by Lender, must execute a Construction Contract Addendum. Lender may also require that Borrower assign the benefits of a construction or consultant contract to Lender as a condition of approval. If Lender has not responded to a submission of a contract or amendment draft by Borrower within 15 business days of receipt by Lender, the contract or amendment shall be deemed approved by Lender. 16. ASSIGNMENT OF DEVELOPMENT RIGHTS. Subject to the rights of senior lienholders, and to the extent permitted by federal or state law, as additional security for the performance of Borrower's obligations under the Loan Documents, Borrower irrevocably assigns to Lender, and grants to Lender a security interest in, Borrower's interests in and rights to the following: all governmental permits, maps, and approvals it has obtained or will obtain for development of the Project; all construction contracts and subcontracts and all supply contracts and subcontracts now or Attachment No. 2 hereafter entered into for the Project; all contracts with architects, landscape architects, planners, geologists, surveyors, engineers, economists, or other development consultants now or hereafter entered into for the Project; all plans, specifications, drawings, data, and studies produced by these architects and development consultants; all private and governmental grants, subsidies, loans, and other financing for development of the Project, including any syndication proceeds, now or hereafter held by Borrower; and all reserves, deferred payments, deposits, refunds, cost savings, and payments relating to development of the Project. Borrower shall ensure that the third parties to the contracts referenced above for Project work consent to the assignment of these contracts to Lender. This assignment shall become effective upon an Event of Default that has not been cured in the manner and time provided herein and express written notice to Borrower thereafter that Lender intends to exercise the assignment. Lender shall not have any obligation under any assigned contracts or agreements until it expressly agrees in writing. Upon an Event of Default that has not been cured pursuant to this Agreement and notwithstanding any other provisions of the Loan Documents, Lender may use any of the foregoing assigned permits, contracts, agreements, plans, specifications, data, studies, funds, and accounts for any purpose for which Borrower could have used them under the Loan Documents or otherwise for development of the Project. Upon an Event of Default which has not been cured pursuant to this Agreement, Lender shall have the right, in its discretion, to enter upon and take possession of the Property, remove Borrower and its agents from the Property, and take any actions necessary in its judgment to complete development of the Project. This includes employing such contractors, subcontractors, agents, consultants, engineers, and architects as required to complete the rehabilitation, making changes in plans, specifications, work, or materials, entering into, modifying, or terminating any contractual arrangements, and/or using any funds or funding commitments held by Borrower, subject to Lender's right at any time to discontinue work without liability. If Lender elects to complete rehabilitation of the Project, Lender will not assume any liability to Borrower or to any other person for completing the Project, or for the manner or quality of rehabilitation of the Project, and Borrower expressly waives such liability. Borrower irrevocably appoints Lender as its attorney -in -fact, with full power of substitution, to complete the Project in Borrower's name, or Lender may elect to complete development in its own name, all effective upon an Event of Default and failure to cure. 17. PLANS AND SPECIFICATIONS. No later than the date set forth in the Schedule, Borrower must submit to Lender for its review and approval the Plans and Specifications. Borrower must develop the Project in conformance with the approved Plans and Specifications and any modifications authorized under this Agreement. Borrower understands and agrees that Lender approval of any Plans and Specifications pursuant to this section is approval only for purposes of administration of this Loan, and should not be considered in any way an issuance of a building permit or other permit, or any other approval required pursuant to the regulatory authority of the City. 18. QUALITY OF WORK. Borrower shall rehabilitate the Project in conformance with general industry standards and must employ building materials of a quality suitable for the requirements of the Project. Borrower shall develop the Project in full conformance with applicable local, state, and federal statutes, regulations, and building and housing codes. Attachment No. 2 19. CHANGES IN WORK. Borrower must obtain Lender's written approval of a written change order before any of the following changes, additions, or deletions in Project work may be performed: (1) any change that exceeds twenty-five thousand dollars ($25,000); or (2) any set of changes that cumulatively exceeds fifty thousand dollars ($50,000) or 10% of the Loan amount, whichever is less; or (3) any substantial change in building materials or equipment, specifications, or the architectural or structural design of the Project as called for in the Plans and Specifications. If Lender has not responded to a written request for a change order by Borrower within 8 City business days of receipt of such request by Lender, such request shall be deemed approved by Lender. Consent to any additions, changes, or deletions to the work shall not release Borrower from any other obligations in the Loan Documents, or release Borrower or its surety from any surety bond. 20. RECORDS. Borrower shall maintain records which fully and accurately show the date, amount, purpose, and payee of all expenditures for rehabilitation of the Project, and shall keep all estimates, invoices, receipts, and other documents related to Loan fund expenditures for at least five years after completion of rehabilitation of the Project as evidenced by the issuance of a Certificate of Satisfaction of Development Obligations. Borrower shall make records available for review by Lender's representatives. Records shall be kept accurate and up-to-date. Lender shall notify Borrower of any records it deems in its reasonable judgment to be insufficient. Borrower shall have 8 City business days from such notice to correct any specified deficiency in the records, or, if more than 8 City business days shall be reasonably necessary to correct the deficiency, Borrower shall begin to correct the deficiency within 8 City business days and correct the deficiency as soon as reasonably possible. 21. SITE INSPECTIONS. Borrower, through its staff or its development representative, shall permit and facilitate observation and inspection of work at the Project site by Lender's authorized representatives during normal business hours. 22. AUDITS. Borrower must make available at Borrower's or its development representative's office for examination at reasonable intervals and during normal business hours to Lender's representatives all books, accounts, reports, files, and other papers or property with respect to all matters covered by these Loan Documents, and shall permit these representatives to audit, examine, and make copies, excerpts or transcripts from such records. Lender's representatives may make audits of any conditions relating to this Loan. 23. PROJECT MONITORING AND EVALUATION. Borrower shall maintain and submit records to Lender within ten business days of Lender's request which clearly document Borrower's performance under each requirement of the Loan Documents. Borrower shall supply promptly, upon Lender's reasonable request, any information or documentation pertaining to the Project and must cooperate with Lender's representatives on matters related to Project monitoring and evaluation. Commencing upon completion of rehabilitation, Borrower shall pay to the Lender an annual monitoring fee ("Loan Monitoring Fee"), as determined by the Lender in schedules printed by the Lender from time to time. The Loan Monitoring Fee shall be subject to revision annually. The Loan Monitoring Fee shall be paid to the Lender annually within ten (10) days after the Lender provides a written invoice to Borrower for the same. Failure to timely pay the Loan Monitoring Fee shall constitute a material default under this Agreement and the Regulatory Agreement. The Loan Monitoring Fee shall be paid to the Lender as a consideration for the lending of funds by the Lender to the Borrower. 24. NO LENDER REVIEW RESPONSIBILITIES. Lender shall not be responsible for Borrower's conduct in connection with the Project, including, but not limited to, the quality and suitability of the Plans and Specifications, the supervision of the rehabilitation work, and the Attachment No. 2 qualifications, financial conditions, and performance of all architects, engineers, contractors, subcontractors, suppliers, consultants, and property managers. Lender is under no duty to review the Plans and Specifications or to inspect rehabilitation of the Project. Any review or inspection undertaken by Lender for the Project is solely for the purpose of determining whether Borrower is properly discharging its obligations to Lender, and should not be relied upon by Borrower or by any third parties, including homebuyers, as a warranty or representation by Lender as to the quality of the design or rehabilitation of the Project. 25. ENCUMBRANCE OF PROPERTY. Borrower may not engage in any financing or any other transaction creating any security interest or other encumbrance or lien upon the Property, whether by express agreement or operation of law, or allow any encumbrance or lien to be made on or placed on the Property prior to completion of Project development, except with the prior written consent of Lender or as otherwise specifically authorized under this Agreement. Borrower shall notify Lender in writing in advance of any financing secured by any deed of trust, mortgage, or other similar lien instrument that it proposes to enter into with respect to the Project or Property, or any encumbrance or lien that has been attached to the Property, whether voluntary or involuntary. Lender reserves the right to condition its consent to any other financing on the use of the proceeds of such financing to pay any loan fee due and unpaid to Lender in connection with this Loan. Notwithstanding the foregoing, Borrower shall have the right to refinance the senior loan in accordance with the terms of the Regulatory Agreement. 26. TRANSFER OF PROPERTY AND PROJECT. Borrower represents that it has not made, and agrees it shall not make or permit any sale, agreement to sell, assignment, conveyance, lease, further encumbrance, or other transfer of this Agreement or any part of the Project or the Property (except for the rental of Project Units to tenant households as set forth in the Regulatory Agreement), including the sale of any general or limited partnership interests, the removal of any general partner, or any substantial change in Project control (collectively referred to as "Transfers"), without the prior written consent of Lender in its sole discretion. Notwithstanding the foregoing, the following transactions are hereby deemed to be expressly permitted under the Loan Documents: (i) the transfer by the Limited Partners of their interests in the Borrower to any other entity which is affiliate of the Limited Partners or which is directly or indirectly controlled by WNC & Associates, Inc., or an affiliate thereof, (ii) a change in the beneficial ownership of the Limited Partners, so long as such entity remains controlled by WNC & Associates, Inc., or an affiliate thereof or an affiliate thereof, (ii) the pledge and encumbrance of the interests of the Limited Partners to or for the benefit of any financial institution which enables the Limited Partners to make their capital contributions to Borrower, (iii) the removal of any general partner of the Borrower by Limited Partners pursuant to the terms of the Partnership Agreement and the admission of a replacement general partner acceptable to Lender in its reasonable discretion, (iv) issuance of partnership interests in Borrower equal to 99.99% of the profits, losses credits, distributions and other interest in Borrower to the Limited Partners of Borrower and (v) the transfer of limited partnership interests in Borrower to the General Partner or an affiliate thereof or the transfer of the Project to the General Partner or an affiliate thereof following the expiration of the tax credit compliance period. 27. PROJECT SYNDICATION. The Lender hereby approves the execution of the Partnership Agreement pursuant to which Limited Partners become the limited partners of the Borrower. The Project may not be further syndicated without the prior review by Lender of all documents governing the syndication and written consent by Lender to the terms of the syndication. For purposes of this section, "syndication" means the sale of equity shares or interests in the Property or the Project to investors, including without limitation investors who are seeking low income housing tax Attachment No. 2 credits or historic rehabilitation tax credits. In the event that Borrower intends to syndicate the Project, Borrower must submit to Lender at least 30 calendar days prior to syndication closing, for review and approval by Lender, a proposed syndication budget identifying the proposed uses of all syndication proceeds. Such uses may include direct Project development and operation costs, reasonable fees for structuring and marketing the syndication, and reasonable reserves as required by debt or equity financing sources or as otherwise approved by Lender. All net syndication proceeds, leveraged funds, and other money received by Borrower or an affiliate in connection with the Project which are not required to meet the financial obligations set forth in the Budget, the Partnership Agreement, or the approved syndication budget must be used to repay the Loan. Such funds shall be deposited with Lender within 30 days of receipt by Borrower or Borrower's affiliate. Lender reserves the right to earmark the use of any fee received by Borrower or Borrower's affiliate for the syndication as a condition of its consent to the syndication. 28. MECHANICS LIENS AND STOP NOTICES. If any claim of mechanics lien is filed against the Property or a stop notice affecting the Loan is served on Lender, Borrower shall, within 20 days of such filing or service, either pay and fully discharge the lien or stop notice, obtain an unconditional release of the lien or stop notice by recording a release bond, delivering to Lender a surety bond in sufficient form and amount, or provide Lender with other assurance reasonably satisfactory to Lender that the lien or stop notice will be paid or discharged. If Borrower fails to discharge any such lien, encumbrance, charge, or claim, then Lender may, but shall be under no obligation to, discharge the same at Borrower's expense. Alternatively, Lender may require Borrower to immediately deposit with Lender the amount necessary to satisfy such lien or claim and any costs, pending resolution thereof. Lender may use such deposit to satisfy any claim or lien that is adversely determined against Borrower. Borrower shall file a valid notice of cessation or notice of completion upon cessation of rehabilitation on the Project for a continuous period of 30 days or more, and shall take all other reasonable steps to forestall the assertion of claims of lien against the Property. Borrower authorizes Lender, but without any obligation, to record any notices of completion or cessation of labor, or any other notice that Lender deems necessary or desirable to protect its interest in the Project and Property; provided, however, that Lender shall exercise this right only if and when Borrower fails to take action as required. 29. DISABLED ACCESS. Borrower shall rehabilitate the Project and maintain the Property in compliance with all applicable federal, state, and local requirements for access for disabled persons. 30. LEAD -BASED PAINT. Borrower and its contractors and subcontractors shall not use lead -based paint in the rehabilitation of the Project or maintenance of Project Units. Borrower shall insert this provision in all contracts and subcontracts for work performed on the Project which involve the application of paint. Borrower shall ensure, from the date of completion through the date the affordability period terminates, that the Project is in compliance with the lead based paint provisions contained in the Lead -Based Paint Poisoning Act (42 USC Section 4821 et seq.), 24 CFR Part 35, and 24 CFR Section 982.401(j). Borrower shall be responsible for all testing and abatement activity. 31. CERTIFICATE OF SATISFACTION OF DEVELOPMENT OBLIGATIONS. Upon completion of rehabilitation of the Project, Borrower shall submit a certification from the Project architect stating that the improvements to the Property have been made in accordance with the Plans and Specifications. Upon (1) submission of this architect's certification, (2) a determination of final Project costs, (3) a determination by Lender that Borrower has completed the Project in conformance Attachment No. 2 with industry standards and the Plans and Specifications, (4) a determination by Lender in Lender's reasonable judgment that Borrower has satisfied all of Borrower's development obligations under this Agreement, and (5) completion of a cost certification of the Project signed under penalty of perjury, Lender shall furnish Borrower, within 15 calendar days of a written request by Borrower, with a Certificate of Satisfaction of Development Obligations for the full Project or the applicable phase of the Project. If Lender determines that issuance of said Certificate is unwarranted, it shall provide Borrower with a written statement within the above time frame indicating in what respects Borrower is deficient, and what measures Borrower will need to take or what standards it will need to meet in order to obtain the Certificate. If Borrower subsequently takes the specified measures or meets the specified standards, and is not otherwise in default under the Loan Documents, Lender shall then deliver a Certificate to Borrower. 32. OPERATION OF PROJECT. Borrower and its agents shall diligently operate and manage Project Units after Project completion in full conformance with the covenants contained in the Regulatory Agreement, which are intended to run with the land and bind all successors -in -interest to the Property for the full term of the Regulatory Agreement, and with the terms of the Final Management Plan as defined in the Regulatory Agreement. 33. NONDISCRIMINATION. Borrower may not discriminate or segregate in the use, enjoyment, occupancy, conveyance, lease, sublease, or rental of any part of the Property on the basis of race, color, ancestry, national origin, religion, sex, sexual preference, age, marital status, family status, source of income, physical or mental disability, Acquired Immune Deficiency Syndrome (AIDS) or AIDS -related conditions, or any other arbitrary basis. Borrower must otherwise comply with all applicable local, state and federal fair housing laws. Specifically, Borrower must ensure that the Project is conducted and administered in conformance with Title VI of the federal Civil Rights Act of 1964 and the federal Fair Housing Act, and implementing regulations. 34. FEES, TAXES, AND OTHER LEVIES. Borrower is responsible for payment of all fees, assessments, taxes, charges, liens and levies imposed by any public authority or utility company with respect to the Property or the Project, and shall pay such charges prior to delinquency. However, Borrower shall not be required to discharge any such charge so long as (a) the legality thereof is being contested in good faith and by appropriate proceedings, and (b) Borrower maintains reserves adequate to pay any contested liabilities. 35. DAMAGE TO PROPERTY. If any building or improvements erected by Borrower on the Property is extensively damaged or destroyed, and the cost of restoring the building or improvements is covered by insurance proceeds, Borrower must, at its own cost and expense, repair or restore said buildings and improvements consistent with the original Plans and Specifications (for purposes hereof, a loss shall be considered "covered by insurance proceeds" notwithstanding any policy deductible or self -insured retention). Such work must be commenced within 180 days after the damage or loss occurs and shall be complete within one year thereafter. All insurance proceeds collected for such damage or destruction and other funds available to Borrower shall be applied to the cost of such repairs or restoration. 36. RELOCATION. The parties anticipate that any relocation of tenants will be of a temporary nature. To the extent that acquisition or rehabilitation of the Property results in the permanent or temporary displacement of residential tenants, homeowners, or businesses, then Borrower shall comply with all applicable local, state, and federal statutes and regulations with respect to relocation planning, advisory assistance, and payment of monetary benefits, including: the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (42 U.S.C. Section 4601, et Attachment No. 2 seq.), and implementing regulations at 49 C.F.R. Part 24; Section 104(d) of the Housing and Community Development Act of 1974 and implementing regulations at 24 C.F.R. Part 42; 24 C.F.R. Section 570.606; and California Government Code Section 7260 et seq. and implementing regulations at 25 California Code of Regulations Section 6000 et seq. Borrower shall be solely responsible for payment of any relocation benefits to any displaced persons and any other obligations associated with complying with such relocation laws. Borrower shall indemnify, defend (with counsel reasonably chosen by Lender), and hold harmless Lender against all claims which arise out of relocation obligations to residential tenants, homeowners, or businesses permanently or temporarily displaced by the acquisition or rehabilitation of the Property. EMPLOYMENT AND CONTRACTING 37. NONDISCRIMINATION. Borrower may not discriminate against any employee or applicant for employment on the basis of race, color, religion, sex, sexual preference, national origin, AIDS or AIDS -related conditions, or disability in any phase of employment during rehabilitation. Borrower agrees to post in conspicuous places available to all employees and applicants for employment, notices to be provided setting forth the provisions of this nondiscrimination clause. 38. COMPLIANCE WITH LAWS. Borrower shall carry out the design, rehabilitation and operation of the Project in conformity with all applicable laws, including all applicable state labor standards; the Lender zoning and development standards, building, plumbing, mechanical and electrical codes, and all other provisions of the Lender's Municipal Code, and all applicable disabled and handicapped access requirements, including without limitation the Americans With Disabilities Act, 42 U.S.C. Section 12101, et seq., Government Code Section 4450, et seq., Government Code Section 11135, et seq., the Unruh Civil Rights Act, Civil Code Section 51, et seq., and the California Building Standards Code, Health and Safety Code Section 18900, et seq. 39. REPORTING. Borrower must submit annually, no later than June 30th, of each year during the term of this Agreement, for the calendar year ending the immediately previous December 31 S`, with such records and reports as are required and are requested by the Lender. The records and reports include (to the extent applicable), but are not limited to the following: (1) Eligible tenant information, including yearly income verifications; (2) Information on rents and occupancy of the Project Units; (3) On -site inspection results; (4) Insurance policies and notices; (5) Equal Employment Opportunity and Fair Housing records; (6) Labor costs and records; (7) Audited income and expense statement, balance sheet and statement of cash flows for Borrower; Attachment No. 2 (8) A Management Plan for the calendar year in which the report is prepared showing anticipated rental income, other income, expenses, anticipated repairs and replacements to the Project, timing of such repairs and replacements, insurance maintained on behalf of the Project, and such other matters as Lender shall require, in the Lender's sole discretion; (9) Federal and State income tax returns for the calendar year, ending on the preceding December 31 st; (10) Annual budget of reserves for repair and replacement; (11) Annual certification and representation regarding status of all loans, encumbrances and taxes; (12) Annual statement regarding condition of the Property disclosing any known defects; (13) Available Cash Flow computation on the approved Lender form; (14) A report or reports, certifying compliance with the terms and provisions of the Section 3 requirements; and (15) Such other and further information and records as the Lender shall request in writing from Borrower. Time is of the essence in supplying each and every report required to be supplied to Lender. The parties agree that a fee of $25.00 per day shall be paid by Borrower to Lender for each day that each report is delinquent. The parties agree that multiple fees may be charged at any one time, depending upon the number of reports and/or information that is delinquent. The parties agree that a fee of $25.00 per day, per report and/or information is a reasonable estimation of the damages that will accrue to Lender as a result of the failure of Borrower to timely submit the required information and/or reports and that said fees shall be treated as liquidated damages by the parties, in anticipation of the damages that will be incurred by Lender as a result of a breach by Borrower. The parties further agree that it would be difficult, if not impossible, to determine the exact actual amount of damages suffered by Lender in the event of a breach by Borrower in the reporting requirements of this Agreement. Notwithstanding the foregoing or anything to the contrary contained herein, Lender shall give Borrower prior written notice of any report and/or information that Borrower has failed to provide Lender and Borrower shall have thirty (30) days to provide such report and/or information to Lender prior to the assessment of any liquidated damages. Attachment No. 2 INDEMNITY AND INSURANCE 40. INSURANCE COVERAGE. Borrower must have or cause to have in full force and effect the insurance coverage specified in Exhibit I to this Agreement. In addition, Borrower shall ensure that the general contractor for the Project maintains the insurance coverage specified in Exhibit I for the duration of Project rehabilitation. 41. INSURANCE ADVANCES. In the event Borrower fails to maintain the full insurance coverage required by this Agreement, Lender, after at least seven business days prior written notice to Borrower, may, but shall be under no obligation to, take out the required insurance policies and/or pay the premiums on such policies. Any amount advanced by Lender, together with interest from the date of such advance at the same rate of interest specified in the Note (unless payment of such an interest rate would be contrary to applicable law, in which case interest shall accrue at the highest rate then allowed by applicable law), shall become payable by Borrower to Lender, subject to all the terms and conditions of this Agreement, and shall be secured by the Deed of Trust. 42. TITLE AND TITLE INSURANCE. Borrower warrants that it shall obtain fee simple absolute title to the Property in a good and marketable condition concurrently with closing. As a condition of the Loan, Borrower shall obtain at Borrower's sole expense an ALTA Loan Policy of title insurance insuring Lender, with liability not less than the principal amount of the Loan, issued by an insurer satisfactory to Lender, excepting only such defects, liens, encumbrances, and exceptions as are reasonably approved by Lender, and containing such endorsements as Lender may require. 43. NON -LIABILITY OF OFFICIALS, EMPLOYEES AND AGENTS. No member, official, officer, director, employee, or agent of the Lender or the City shall be personally liable to Borrower for any obligation created under the terms of these Loan Documents except in the case of actual fraud or willful misconduct by such person. 44. INDEMNITY. Notwithstanding the insurance coverage required herein, Borrower hereby indemnifies and holds the Lender, the City, its members, officials, officers, directors, employees, and agents (collectively, the "Indemnified Parties") harmless from any losses, damages, liabilities, claims, demands, judgments, actions, court costs, and legal or other expenses (including reasonable attorneys' fees) which an Indemnified Party may incur as a result of (1) the making of this Loan to Borrower (other than losses resulting from a finding that the Loan is illegal or unauthorized); (2) Borrower's failure to perform any of its obligations as and when required by the Loan Documents; (3) a failure of any of Borrower's representations or warranties to be true and complete in any material respect; or (4) any act or omission by Borrower or any contractor, subcontractor, architect, engineer, consultant or supplier with respect to the Project or the Property, except to the extent that the loss is caused by the negligence or willful misconduct of the Indemnified Party. Borrower shall pay immediately upon the Indemnified Party's demand any amounts owing under this indemnity provision. The duty of Borrower to indemnify includes the duty to defend the Indemnified Party in any court action, administrative action, or other proceeding brought by any third party arising from the Project or the Property with counsel reasonably acceptable to the Indemnified Party. Borrower's duty to indemnify the Indemnified Parties shall survive the term of the Loan and the reconveyance of the Deed of Trust. Attachment No. 2 HAZARDOUS MATERIALS 45. REPRESENTATIONS AND WARRANTIES. After reasonable investigation and inquiry, Borrower represents and warrants to the best of its knowledge, as of the date of this Agreement and except as previously disclosed to and acknowledged in writing by Lender or as disclosed in connection with the NEPA approval of the Project, based on environmental audit(s) performed on the Property, that (a) the Property are not and have not been a site for the use, generation, manufacture, transportation, storage, or disposal of Hazardous Materials; (b) the Property are in compliance with all Hazardous Materials Laws; (c) there are no claims or actions pending or threatened with respect to the Property by any governmental entity or agency or any other person relating to Hazardous Materials; and (d) there has been no release or threatened release of any Hazardous Materials on, under, or near the Property (including in the soil, surface water, or groundwater under the Property) or any other occurrences or conditions on the Property or on any other real property that could cause any part of the Property to be classified as a "hazardous waste property" or as a "border zone property" under California Health and Safety Code Sections 25220, et seq., or regulations adopted therewith. 46. NOTIFICATION TO LENDER. Borrower shall immediately notify Lender in writing of: (a) the discovery of any concentration or amount of Hazardous Materials on or under the Property requiring notice to be given to any governmental agency under Hazardous Materials Laws; (b) any knowledge by Borrower that the Property does not comply with any Hazardous Materials Laws; (c) the receipt by Borrower of written notice of any Hazardous Materials claims; and (d) the discovery by Borrower of any occurrence or condition on the Property or on any real property located within 2,000 feet of the Property that could cause any part of the Property to be designated as a "hazardous waste property" or as a "border zone property" under California Health and Safety Code Sections 25220, et seq., or regulations adopted therewith. 47. USE AND OPERATION OF PROPERTY. Neither Borrower, nor any agent, employee, or contractor of Borrower, nor any authorized user of the Property may use the Property or allow the Property to be used for the generation, manufacture, storage, disposal, or release of Hazardous Materials. Borrower must comply and cause the Project to comply with Hazardous Materials Laws not more than 30 days after Borrower's receipt of written notice by Lender to do so. 48. REMEDIAL ACTIONS. If Borrower has actual knowledge of the presence of any Hazardous Materials on or under the Property, Borrower shall immediately take at no cost to Lender, all handling, treatment, removal, storage, decontamination, cleanup, transport, disposal or other remedial action required by Hazardous Materials Laws or by any orders or requests of any governmental agency or any judgment, consent decree, settlement or compromise with respect to any Hazardous Materials claims. The foregoing shall be subject to Borrower's right of contest below. 49. RIGHT OF CONTEST. Borrower may contest in good faith any claim, demand, levy or assessment under Hazardous Materials Laws if: (a) the contest is based on a material question of law or fact raised by Borrower in good faith, (b) Borrower promptly commences and thereafter diligently pursues the contest, (c) the contest will not materially impair the taking of any remedial action with respect to such claim, demand, levy or assessment, and (d) Borrower demonstrates to Lender's reasonable satisfaction that Borrower has the financial capability to undertake and pay for such contest and any remedial action then reasonably necessary. No Event of Default shall be deemed to exist with respect to any claim, demand, levy or attachment being contested by Borrower under this section. Attachment No. 2 50. ENVIRONMENTAL INDEMNITY. Borrower shall defend, indemnify, and hold Lender, its members, officials, directors, employees or agents, harmless against any claims, demands, administrative actions, litigation, liabilities, losses, damages, response costs, and penalties, including costs of legal proceedings and attorney's fees, that Lender may incur as a result of any inaccuracy or breach of any representation, warranty, agreement, or covenant contained in this Agreement with respect to Hazardous Materials, or as a consequence of any use, generation, manufacture, storage, release, or disposal (whether or not Borrower knew of same) of any Hazardous Materials occurring as a result of Borrower's use or occupancy of the Property. DEFAULT AND REMEDIES 51. EVENTS OF DEFAULT BY BORROWER. The occurrence of any of the following events shall be an "Event of Default" by Borrower under this Agreement: A. Monetary. (1) Borrower's failure to pay when due any sums payable under the Loan Documents, including failure to reimburse Lender for any advances made by Lender under this Agreement or the Deed of Trust; (2) Borrower's use of Loan funds for costs other than Eligible Costs or for uses inconsistent with other terms and restrictions in the Loan Documents; (3) Borrower's failure to obtain and maintain the insurance coverage required under this Agreement; (4) Borrower's failure to make any other payment or assessment due under the Loan Documents; or (5) the disbursement, release, hypothecation or encumbrance of all or any portion of the Loan Funding Reserve without the written consent of the Lender; B. Rehabilitation. (1) Any changes in the work of rehabilitation specified in the approved Plans and Specifications without Lender's prior written consent if such consent is required under this Agreement; (2) Borrower's use of defective or unauthorized materials or defective workmanship in rehabilitating the Project; (3) Borrower's failure to commence or complete Project rehabilitation, without proper justification under the enforced delay provision of this Agreement, according to the Commencement Date and Completion Date specified in this Agreement; (4) a substantial cessation of rehabilitation prior to Project completion for a period of more than 30 continuous calendar days; (5) the filing of any claim of lien against the Property or service on Lender of any stop notice relating to the Loan, and the continuance of the claim of lien or stop notice for 20 days after such filing or service without payment, discharge, or satisfaction as provided for in this Agreement; (6) Borrower's failure to remedy any material deficiencies in recordkeeping or failure to provide records to Lender upon Lender's request; or (7) Borrower's failure to substantially comply with any federal, state, or local laws or Lender policies governing rehabilitation, including but not limited to provisions of this Agreement pertaining to Project employment, disabled access, lead paint, and Hazardous Materials; C. Operation. (1) Rental of Project Units to households whose incomes do not qualify them for occupancy, or any failure of Borrower or Borrower's agent to take adequate steps to certify incomes; (2) overcharging in rental of Project Units by Borrower or Borrower's agent; (3) Borrower's or Borrower's agent's failure to comply with the Regulatory Agreement or the Final Management Plan as defined in the Regulatory Agreement; (4) discrimination by Borrower or Borrower's agent on the basis of characteristics prohibited by this Agreement or applicable law; (5) the imposition of any encumbrances or liens on the Property without Lender's prior written approval, except as otherwise allowed under this Agreement, or that have the effect of reducing the priority of or invalidating the Deed Attachment No. 2 of Trust; (6) except as set forth in Section 25, the Transfer of the Property, the Project, or this Agreement or the assignment of any interest in any of the Loan Documents or the Regulatory Agreement (whether by assignment or novation) without Lender's prior written consent; (7) conversion of Project Units to condominium or cooperative ownership without Lender's prior written consent and except as otherwise permitted under this Agreement; (8) Borrower's or Borrower's agent's failure to substantially comply with any federal, state, or local laws or Lender policies governing the operation and management of housing, including without limitation provisions of this Agreement and the Regulatory Agreement pertaining to maintenance and security, disabled access, lead paint, Hazardous Materials, conflicts of interest, and political activities; or (9) except to effectuate transferes permitted pursuant to Section 25 and or make ministerial changes or other modifications that will not adversely impact the Lender to the Borrower's obligations hereunder, the amendment, modification, restatement, revocation or rescission of the Borrower's LP-1 or the Partnership Agreement; D. General performance of Debt obligations. Any failure to perform, in a timely manner, any agreement or covenant of the Borrower under any of the Loan Documents, the Regulatory Agreement or any notes, loans and deeds of trust that are senior and/or junior to the Deed of Trust, subject to all applicable notice and cure periods; E. General performance of other obligations. Any breach by Borrower or Borrower's agents of any material obligations of Borrower imposed by any other agreements with respect to the financing, development, or operation of the Project or the Property, whether or not Lender is a party to such agreement; F. Representations and warranties. A determination by Lender in its reasonable judgment that any of Borrower's representations or warranties made in the Loan Documents, any statements made to Lender by Borrower, or any certificates, documents, or schedules supplied to Lender by Borrower were untrue in any material respect when made, or that Borrower concealed or failed to disclose a material fact from Lender; G. Damage to Property. Material damage or destruction to the Property, if Borrower does not take steps to reconstruct the Property as required herein; H. Bankruptcy, dissolution, and insolvency. Borrower's or Borrower's general partner's (1) filing for bankruptcy, dissolution, or reorganization, or failure to obtain a full dismissal of any involuntary filing brought by another party under bankruptcy or similar laws before the earlier of fmal relief or 60 days after filing; (2) making a general assignment for the benefit of creditors; (3) applying for the appointment of a receiver, trustee, custodian, or liquidator, or failure to obtain a full dismissal of any such involuntary application brought by another party before the earlier of final relief or 60 days after the filing; (4) insolvency; or (5) failure, inability or admission in writing of its inability to pay its debts as they become due. 52. NOTICE OF BORROWER'S DEFAULT AND OPPORTUNITY TO CURE. Lender shall give written notice to Borrower and the Limited Partners of any Event of Default on the part of Borrower. Said notice shall specify the nature of the act, omission, or deficiency giving rise to the Event of Default. In addition, if the Event of Default is curable, does not pertain to a failure to comply with the Commencement Date and/or the Completion Date, and does not give rise to an imminent danger to health or safety, then the notice shall also specify the action required to cure the Attachment No. 2 default. If the default is not cured within 30 calendar days or the Borrower does not commence such cure within 30 calendar days and diligently pursue the cure to completion within a reasonable time thereafter, the Lender may proceed with all of its rights and remedies under the terms of the Loan Documents, Regulatory Agreement or at law. Limited Partners shall have the same cure rights as the Borrower hereunder. 53. LENDER'S REMEDIES. Upon any uncured Event of Default as provided for above, Lender may, in addition to other rights and remedies permitted by the Loan Documents, Regulatory Agreement or applicable law, proceed with any or all of the following remedies in any order or combination Lender may choose in its sole discretion: B. Bring an action for equitable relief (1) seeking the specific performance by Borrower of the terms and conditions of the Loan Documents, and/or (2) enjoining, abating, or preventing any violation of said terms and conditions, and/or (3) seeking declaratory relief; C. Accelerate the Loan, and demand immediate full payment of the principal amount outstanding and all accrued interest under the Note, as well as any other funds advanced to Borrower by Lender under the Loan Documents, including reasonable administrative costs, immediately due and payable; D. Enter the Property and take any actions necessary in its reasonable judgment to complete Project rehabilitation as permitted under this Agreement, including without limitation (1) making changes in the Plans and Specifications or other work or materials for the Project, (2) entering into, modifying, or terminating any contractual arrangements (subject to Lender's right at any time to discontinue work without liability), or (3) taking any remedial actions with respect to Hazardous Materials that Lender reasonably deems necessary to comply with Hazardous Materials Laws or to render the Property suitable for occupancy; E. Seek appointment from a court of competent jurisdiction of a receiver with the authority to complete rehabilitation as needed to preserve Lender's interest in seeing the Project developed in a timely manner, including the authority to take any remedial actions with respect to Hazardous Materials that Lender or the receiver deems necessary to comply with Hazardous Materials Laws or to render the Property suitable for occupancy; F. Order immediate stoppage of rehabilitation and demand that any condition leading to the Event of Default be corrected before rehabilitation may continue; G. Enter upon, take possession of, and manage the Property, either in person, by agent, or by a receiver appointed by a court, and collect rents and other amounts specified in the assignment of rents in the Deed of Trust and apply them to operate the Property or to pay off the Loan or any advances made under the Loan Documents, as provided for in the Deed of Trust; H. Initiate and pursue any private and/or judicial foreclosure action allowed under applicable law and the power of sale provision in the Deed of Trust; Attachment No. 2 I. With respect to defaults under Hazardous Materials provisions herein, pursue the rights and remedies permitted under California Civil Code Section 2929.5, and California Code of Civil Procedure Sections 564, 726.5, and 736; or J. Pursue any other remedy allowed at law or in equity. 54. LENDER'S DEFAULT AND BORROWER'S REMEDIES. Borrower shall give written notice to Lender of any Event of Default on the part of Lender. Said notice shall specify the nature of the act, omission, or deficiency giving rise to the Event of Default. In addition, if the Event of Default is curable and does not give rise to an imminent danger to health or safety, the notice shall also specify the action required to cure the default, and a reasonable date, which shall not be less than 30 calendar days from the mailing of the notice, by which Lender must take or commence such action to cure. If the notice specifies only a commencement date for the cure, Lender shall commence such cure within the specified time and shall diligently pursue the cure to completion within a reasonable time thereafter. Upon such notice and the failure of Lender to cure such default or commence the cure, Borrower may: A. Demand payment from Lender of any sums due Borrower; B. Bring an action for equitable relief seeking the specific performance by Lender of the terms and conditions of the Loan Documents; or C. Pursue any other remedy allowed at law or in equity. GENERAL PROVISIONS 55. BORROWER'S WARRANTIES. Borrower represents and warrants: (1) that it has access to professional advice and support to the extent necessary to enable Borrower to fully comply with the terms of the Loan Documents and Regulatory Agreement and otherwise carry out the Project; (2) that it is duly organized, validly existing and in good standing under the laws of the State of California; (3) that it has the full power and authority to undertake the Project and accept the Loan; (4) that there are no pending, or to the best of Borrower's knowledge, threatened actions or proceedings before any court or administrative agency which may substantially affect the financial condition or operation of Borrower, other than those already disclosed to Lender; (5) that the persons executing and delivering the Loan Documents and Regulatory Agreement are authorized to execute and deliver such documents on behalf of Borrower; and (6) Borrower shall comply with the Regulatory Agreement at all times during the term of the Regulatory Agreement. 56. SUBORDINATION. Lender hereby acknowledges and agrees that the Regulatory Agreement and the Deed of Trust shall be subordinate to the lien and encumbrance recorded concurrently against the Property of the deed of trust executed by Borrower in favor of the California Municipal Finance Authority to secure a loan in the maximum principal amount of $16,000,000.00. 57. LITIGATION. Borrower must promptly give notice in writing to Lender of any litigation pending or threatened against Borrower in which the amount claimed is in excess of fifty thousand dollars ($50,000). 58. CONFLICTS OF INTEREST. Borrower warrants and represents, to the best of its present knowledge, that no public official of Lender who has been involved in the making of this Loan Attachment No. 2 or this Agreement, or who is a member of a Lender board or commission which has been involved in the making of this Loan or this Agreement, has or will receive a direct or indirect financial interest in this Loan or the Project in violation of the rules contained in California Government Code Section 1090, et seq., pertaining to conflicts of interest in public contracting. Borrower shall exercise due diligence to ensure that no such official will receive such an interest. If Borrower, a general partner of Borrower, or an affiliate of Borrower or Borrower's general partner is a nonprofit corporation, Borrower warrants and represents, to the best of its present knowledge, that any such public official of Lender who is an employee or a noncompensated director or officer of said nonprofit corporation has disqualified himself or herself from participating in Lender's decision to make this Loan or Agreement. Borrower further warrants and represents, to the best of its present knowledge and excepting any written disclosures as to these matter already made by Borrower to Lender, that (1) no public official of Lender who has participated in decisionmaking concerning this Loan or the Project or has used his or her official position to influence decisions regarding this Loan or the Project, has an economic interest in Borrower or the Project, and (2) neither the Project nor the Loan will have a direct or indirect financial effect on said official, the official's spouse or dependent children, or any of the official's economic interests. Borrower agrees to promptly disclose to Lender in writing any information it may receive concerning any such potential conflict of interest. Borrower's attention is directed to the conflict of interest rules applicable to governmental decisionmaking contained in the Political Reform Act (California Government Code Section 87100, et seq.) and its implementing regulations (California Code of Regulations, Title 2, Section 18700, et seq.). No compensated employee, independent contractor, consultant, proprietor, or owner of Borrower, any general partner or joint venture partner of Borrower, or any affiliate of Borrower or Borrower's partners, may rent, lease, purchase, or occupy any Project Unit, if said person has been or is in a decisionmaking role with respect to the Project. The prohibition in this paragraph extends to the spouses and dependent children of such persons. Borrower shall exercise due diligence to ensure that no Loan proceeds are used in any self - dealing transaction, within the meaning of the California Corporations Code, involving a material financial interest of a director of (1) Borrower, (2) a general partner of Borrower, or (3) an affiliate of Borrower or Borrower's general partner; unless such transaction is expressly permitted or considered valid under the Corporations Code. 59. POLITICAL ACTIVITY. None of the funds, materials, property, or services contributed by Lender or Borrower under the Loan Documents may be used for any political activity or the election or defeat of any candidate for public office. 60. PUBLICITY. Any publicity generated by Borrower for the Project must make reference to the contribution of Lender in making the Project possible. Lender's name shall be prominently displayed in all pieces of publicity generated by Borrower, including flyers, press releases, posters, signs, brochures, and public service announcements. Lender's staff will be available whenever possible at the request of Borrower to assist Borrower in generating publicity for the Project. Borrower agrees to cooperate with Lender in any Lender -generated publicity or promotional activities with respect to the Project. 61. TERM OF THIS AGREEMENT. This Agreement shall commence on the date first set forth above and remain in full force and effect throughout the term of this Loan, except as may be otherwise specified. Attachment No. 2 62. UNAVOIDABLE DELAY IN PERFORMANCE. The time for performance of provisions of this Agreement by either party shall be extended for a period equal to the period of any delay directly affecting the Project or this Agreement which is caused by: war; insurrection; strikes; lock -outs; riots; floods; earthquakes; fires; casualties; acts of God; acts of a public enemy; epidemics; quarantine restrictions; freight embargoes; lack of transportation; suits filed by third parties concerning or arising out of this Agreement; or unseasonable weather conditions. An extension of time for any of the above -specified causes will be deemed granted only if written notice by the party claiming such extension is sent to the other party within ten calendar days from the commencement of the cause. In any event, rehabilitation of the Project must be completed no later than 90 calendar days after the scheduled Completion Date specified herein, any unavoidable delay notwithstanding. Times of performance under this Agreement may also be extended for any cause for any period of time by the mutual written agreement of Lender and Borrower. 63. GOVERNING LAW. This Agreement shall be interpreted under and be governed by the laws of the State of California, except for those provisions relating to choice of law or those provisions preempted by federal law. 64. STATUTORY REFERENCES. All references in the Loan Documents to particular statutes, regulations, ordinances, or resolutions of the United States, the State of California, or the City of National City shall be deemed to include the same statute, regulation, ordinance, or resolution as hereafter amended or renumbered, or if repealed, to such other provisions as may thereafter govern the same subject. 65. ATTORNEYS' FEES AND COSTS. In the event any legal or administrative action is brought to interpret or enforce the terms of this Agreement, the prevailing party shall be entitled to recover all reasonable attorneys' fees and costs incurred in such action. 66. TIME. Time is of the essence in the performance of this Agreement by Lender and Borrower. 67. CONSENTS AND APPROVALS. Any consent or approval required under this Loan Agreement may not be unreasonably withheld, delayed, or conditioned. 68. NOTICES, DEMANDS AND COMMUNICATIONS. Formal notices, demands and communications between Borrower and Lender shall be given by registered or certified mail, postage prepaid, return receipt requested, or by overnight mail, or shall be delivered personally, to the principal offices of Borrower and Lender as follows, or if any such office is relocated, to the new address specified by the relocated party: LENDER: Community Development Commission -Housing Authority of the City of National City 140 East 12th Street National City, CA 91950-3312 Attn: Executive Director BORROWER: Vista Del Sol Apartments, L.P. 9421 Haven Avenue Rancho Cucamonga, CA 91730 Attachment No. 2 With a copy to: With a copy to: Gubb & Barshay LLP 505 14th Street, Suite 450 Oakland, CA 94612 Attention: Scott Barshay, Esq. WNC California Holding, LLC c/o WNC & Associates, Inc. 17782 Sky Park Circle Irvine, CA 92614-6404 Attention: Michael J. Gaber With a copy to: Holland & Knight Barshay LLP 10 St. James Avenue, 1 1th Floor Boston, MA 02116 Attention: Jonathan I. Sirois, Esq. 69. BINDING UPON SUCCESSORS. All provisions of these Loan Documents are binding upon and inure to the benefit of the heirs, administrators, executors, successors -in -interest, transferees, and assigns of each of the parties; provided, however, that this section does not waive the prohibition on assignment of this Agreement by Borrower without Lender's consent. The term "Borrower" as used in these Loan Documents includes all assigns, successors -in -interest, and transferees of Borrower. 70. RELATIONSHIP OF PARTIES. The relationship of Borrower and Lender is solely that of a debtor and a creditor, and should not be construed as a joint venture, equity venture, partnership, or any other relationship. Lender does not undertake or assume any responsibility or duty to Borrower (except as provided for herein) or to any third party with respect to the Project, the Property, or the Loan. Except as Lender may specify in writing, Borrower has no authority to act as an agent of Lender or to bind Lender to any obligation. 71. ASSIGNMENT AND ASSUMPTION. Borrower may not assign any of its interests under this Agreement or other Loan Documents to any other party, except as specifically permitted under the terms of this Agreement or the other Loan Documents, without the prior written consent of Lender. Any unauthorized assignment shall be void. 72. WAIVER. Any waiver by Lender of an obligation in these Loan Documents must be in writing and must be executed by an authorized agent of Lender. No waiver should be implied from any delay or failure by Lender to take action on any breach or Event of Default of Borrower or to pursue any remedy allowed under the Loan Documents or applicable law. Any extension of time granted to Borrower to perform any obligation under the Loan Documents will not operate as a waiver or release from any of its obligations under the Loan Documents. Consent by Lender to any act or omission by Borrower should not be construed to be a consent to any other act or omission or to waive the requirement for Lender's written consent to future waivers. 73. INTEGRATION. The Loan Documents and the Regulatory Agreement contain the entire agreement of the parties with respect to the Loan, and supersede any prior negotiations. All prior or contemporaneous agreements, understandings, representations, and statements are merged into these Loan Documents and are of no further force or effect. 74. OTHER AGREEMENTS. Borrower represents that it has not entered into any agreements that are inconsistent with the terms of the Loan Documents. Borrower may not enter into Attachment No. 2 any agreements that are inconsistent with the terms of the Loan Documents without an express written waiver by Lender. 75. AMENDMENTS AND MODIFICATIONS. Any amendments or modifications to this Agreement must be in writing, and will be effective only if executed by both Borrower and Lender. 76. SEVERABILITY. Every provision of this Agreement is intended to be severable. If any provision of this Agreement is held invalid, illegal, or unenforceable by a court of competent jurisdiction, the validity, legality, and enforceability of the remaining provisions shall not be affected or impaired. 77. EXHIBITS. The following Exhibits are attached to this Agreement and are hereby incorporated into this Agreement by reference: Exhibit A: Property Description Exhibit B: Budget Exhibit C: Eligible Costs Exhibit D: Project Description Exhibit E: Schedule Exhibit F: Form of Construction Contract Addendum Exhibit G: Insurance Requirements 78. COUNTERPARTS. This Agreement may be signed in multiple counterparts, which, when signed by all parties, will constitute a binding agreement. [SIGNATURE BLOCKS ON NEXT PAGE] Attachment No. 2 IN WITNESS WHEREOF, the undersigned parties have executed this Loan Agreement, effective as of the date first written above. "BORROWER" VISTA DEL SOL APARTMENTS, L.P., a California limited partnership By: Vista Del Sol GP LLC, a California limited liability company, its general partner By: National Community Renaissance of California, a California nonprofit public benefit corporation, its managing member By: Its: [SIGNATURES CONTINUED ON FOLLOWING PAGE] Attachment No. 2 "LENDER" THE COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY, a public body corporate and politic By: Its: Executive Director Approved as to form and legality: By: Deputy City Attorney Attachment No. 2 LOAN AGREEMENT (Vista Del Sol Apartments) EXHIBIT A PROPERTY DESCRIPTION (attached) Attachment No. 2 LOAN AGREEMENT (Vista Del Sol Apartments) EXHIBIT B BUDGET (attached) Attachment No. 2 LOAN AGREEMENT (Vista Del Sol Apartments) EXHIBIT C ELIGIBLE COSTS Eligible Costs include the following costs associated with the low and moderate income affordable component of the Project: Rehabilitation hard costs Soft costs Financing costs Relocation costs Reasonable developer fee and any other items approved in writing by Lender. Attachment No. 2 LOAN AGREEMENT (Vista Del Sol Apartments) EXHIBIT D PROJECT DESCRIPTION Attachment No. 2 LOAN AGREEMENT (Vista Del Sol Apartments) EXHIBIT E SCHEDULE Task Date Attachment No. 2 LOAN AGREEMENT (Vista Del Sol Apartments) EXHIBIT F FORM OF CONTRACTOR ADDENDUM CONSTRUCTION CONTRACT ADDENDUM This Construction Contract Addendum is made this day of by and between Vista Del Sol Apartments, L.P. ("Owner"), and ("Contractor"). RECITALS A. Owner and Contractor have entered into a construction agreement dated under which Contractor has agreed to undertake construction work on the above -captioned housing project (the "Contract"). B. Owner is borrowing funds from the Community Development Commission -Housing Authority of the City of National City, a public body, corporate and politic ("Lender") to support development of the Project, and has executed a Loan Agreement, Deed of Trust, Promissory Note, and Regulatory Agreement in connection with this Loan. The Loan Agreement, Deed of Trust, and Promissory Note are herein referred to as the "Loan Documents." C. Owner and Contractor wish to modify and add to the terms of the Contract as set forth in this Addendum, and Contractor agrees to be bound by the following provisions in the rehabilitation of said Project, in order to provide for certain terms required by Lender as a condition to financing of the Project. Lender has indicated that it will not make this Loan unless Contractor agrees to be bound by the terms hereof. NOW, THEREFORE, Owner and Contractor hereby agree as follows: 1. OWNER'S OBLIGATIONS. Owner agrees that any obligation imposed on Contractor by this Addendum does not waive, diminish, or alter any of Owner's obligations to Lender under the Loan Documents, and that the obligations of Contractor to Lender contained herein are in addition to those obligations of Owner to Lender contained in the Loan Documents. Owner shall be solely responsible for satisfying its obligations to Contractor under the Contract. 2. CONSENT TO ASSIGNMENT OF DEVELOPMENT RIGHTS. Contractor consents to the assignment of its Contract with Owner to Lender under the conditions specified in the loan agreement between Owner and Lender for the Project (the "Loan Agreement"). Contractor agrees that if there is a breach of the Loan Agreement or any other Event of Default, Lender may elect to enforce the assignment and take over the Contract. Contractor agrees to continue to perform its obligations under the Contract and this Addendum for the benefit and account of Lender in the same manner as if performed for the benefit and account of Owner in the absence of the assignment at no additional cost to Lender, as long as Contractor continues to receive the compensation called for under the Contract. Contractor agrees that Lender shall not have any obligation under the Contract until Lender notifies it in writing of Lender's election to accept the assignment. Attachment No. 2 3. COMMENCEMENT AND COMPLETION OF REHABILITATION. Contractor must begin rehabilitation of the Project by the date set for the commencement of rehabilitation in the Loan Agreement. Contractor may not commence rehabilitation until Lender has issued a written notice to proceed to Owner. Contractor must diligently prosecute rehabilitation of the Project to completion, and must complete rehabilitation of the Project by the completion date set forth in the Loan Agreement. 4. CONSTRUCTION BONDS. Contractor must obtain a labor and material (payment) bond and a performance bond, or a dual bond which covers both payment and performance obligations, with respect to the rehabilitation of the Project in a penal sum each of not less than one hundred percent (100%) of the scheduled cost of rehabilitation . Such bonds must be issued by a company which is authorized to transact surety insurance in California and which has assets exceeding its liabilities in an amount equal to or in excess of the bond amount. The bonds must name Lender as a co -obligee or assignee. In lieu of said bonds, a letter of credit in the sole name and possession of Lender in the penal amount and in a form acceptable to Lender may be substituted. 5. CONTRACT WORK. Contractor warrants and represents that it is licensed or otherwise authorized to perform the rehabilitation work specified in the Contract in the State of California. Contractor warrants and represents that it holds a current City of National City Business Tax Certificate. All rehabilitation work must be performed by persons or entities licensed or otherwise authorized to perform the applicable rehabilitation work in the State of California. Contractor shall insert similar provisions in all subcontracts for work for the Project. 6. SUBCONTRACTS. Contractor must submit to Owner for forwarding to Lender drafts of all of its construction subcontracts pertaining to development of the Project. Contractor understands that Lender retains the right to review and approve any such contract or any amendment to any construction contacts prior to execution in which the maximum contract amount exceeds $5,000. As a precondition to approval, Lender may require that the subcontractor enter into an agreement in substantially the same form as this Addendum. 7. QUALITY OF WORK. Contractor must construct the Project in conformance with the Plans and Specifications and any modifications thereto approved by Lender. Contractor must construct the Project according to general industry standards and shall employ building materials of a quality suitable for the requirements of the Project and conforming to general industry standards. Contractor must construct the Project in full conformance with applicable local, state, and federal statutes, regulations, and building and housing codes. The parties acknowledge that Lender is under no duty to review the Plans and Specifications or to inspect rehabilitation of the Project. Any review or inspection undertaken by Lender of the Project is solely for the purpose of determining whether Owner and Contractor are properly discharging their obligations to Lender, and should not be relied upon by Owner, Contractor, or any third parties as a warranty or representation by Lender as to the quality of the design or rehabilitation of the Project. 8. ADDITIONS OR CHANGES IN WORK. Lender and Owner must be notified in a timely manner of any changes in the work required to be performed under the Contract or this Addendum, including any substantial additions, changes, or deletions to the approved Plans and Specifications. A written change order authorized by Lender must be obtained before any of the following changes, additions, or deletions in work for the Project may be performed: (1) any change that exceeds ten thousand dollars ($10,000); or (2) any set of changes that cumulatively exceeds fifty thousand dollars ($50,000) or 10% of the Loan amount, whichever is less; or (3) any substantial change Attachment No. 2 in building materials or equipment, specifications, or the architectural or structural design of the Project as provided for in the Plans and Specifications. Consent to any additions, changes, or deletions to the work shall not release Contractor from any other obligations herein, or release Contractor or its surety from any surety bond. 9. SITE INSPECTIONS. Contractor shall permit and facilitate observation and inspection of work at the job site by Lender and its agents and by public authorities during reasonable business hours. 10. AUDITS. Contractor must make available for examination at reasonable intervals and during normal business hours to Lender's representatives all books, accounts, reports, files, and other papers or property with respect to all matters covered by the Contract and this Addendum, and must permit these representatives to audit, examine, and make copies, excerpts or transcripts from such records. 11. LEAD -BASED PAINT. Contractor and its subcontractors may not use lead -based paint in the rehabilitation or maintenance of the Property. Contractor must insert such a provision in all subcontracts for work performed on the Project which involve the application of paint. Borrower shall ensure, from the date of completion through the date the affordability period terminates, that the Project is in compliance with the lead based paint provisions contained in the Lead -Based Paint Poisoning Act (42 USC Section 4821 et seq.), 24 CFR Part 35, and 24 CFR Section 982.401(j). 12. NONDISCRIMINATION. Contractor may not discriminate against any employee or applicant for employment on the basis of race, color, religion, sex, sexual preference, national origin, AIDS or AIDS -related conditions, or disability in any phase of employment during rehabilitation. Contractor agrees to post in conspicuous places available to all employees and applicants for employment, notices to be provided setting forth the provisions of this nondiscrimination clause. 13.COMPLIANCE WITH LAWS. Contractor shall perform its work in conformity with all applicable laws, including all applicable state labor standards; the Lender zoning and development standards, building, plumbing, mechanical and electrical codes, and all other provisions of the Lender's Municipal Code, and all applicable disabled and handicapped access requirements, including without limitation the Americans With Disabilities Act, 42 U.S.C. Section 12101, et seq., Government Code Section 4450, et seq., Government Code Section 11135, et seq ., the Unruh Civil Rights Act, Civil Code Section 51, et seq., and the California Building Standards Code, Health and Safety Code Section 18900, et seq. 14. REPORTING. Contractor must submit information on forms supplied by Lender concerning the workforce and ownership composition of Contractor, its subcontractors and suppliers, as reasonably requested by Lender. 15. INSURANCE COVERAGE. Contractor, if Contractor is the general contractor for the Project, must have in full force and effect during the rehabilitation of the Project the insurance coverage required under the Loan Agreement. 16. WORKERS' COMPENSATION. Contractor must carry or cause to be carried Workers' Compensation and Employers' Liability Insurance as required by the California Labor Code for all persons employed in connection with this Project. Attachment No. 2 17. NON -LIABILITY OF OFFICIALS, EMPLOYEES AND AGENTS. No member, official, employee, or agent of Lender shall be personally liable to Contractor for any obligation created under the terms of the Contract or this Addendum except in the case of actual fraud or willful misconduct by such person. 18. INDEMNITY. Notwithstanding the insurance requirements herein, Contractor hereby indemnifies and holds Lender, its members, officers, officials, employees, and agents, harmless against any losses, damages, liabilities, claims, demands, judgments, actions, court costs, and legal or other expenses (including attorneys' fees) which Lender may incur as a consequence of Contractor's failure to perform any obligations as and when required by the Contract or this Addendum, any act or omission by Contractor or its subcontractors with respect to the Project, or any failure of any of Contractor's representations or warranties to be true and complete, except to the extent such losses are caused by the negligence or willful misconduct of Lender. Contractor shall pay immediately upon Lender's demand any amounts owing under this indemnity. The duty of Contractor to indemnify includes the duty to defend Lender in any court action, administrative action, or other proceeding brought by any third party arising from the Project. Contractor's duty to indemnify Lender shall survive the term of the Contract. 19. HAZARDOUS MATERIALS. Neither Contractor nor any of its subcontractors may use the Property or allow the Property to be used for the generation, manufacture, storage, disposal, or release of Hazardous Materials. Contractor shall immediately notify Lender and Owner in writing of: (a) the discovery of any concentration or amount of Hazardous Materials on or under the Property requiring notice to be given to any governmental agency under Hazardous Materials Laws; (b) any knowledge by Contractor that the Property do not comply with any Hazardous Materials Laws; (c) the receipt by Contractor of written notice of any Hazardous Materials claims; and (d) the discovery by Contractor of any occurrence or condition on the Property or on any real property located within 2,000 feet of the Property that could cause the Property to be designated as a "hazardous waste property" or as a "border zone property" under California Health and Safety Code Sections 25220, et seq., or regulations adopted therewith. 20. NOTICE OF DEFAULT TO LENDER. Contractor shall give Lender prior or concurrent written notice of any default or breach claimed by Contractor against Owner or any other party under the Contract. The notice shall describe the default and give Lender the option to cure said default within 30 calendar days. No termination of the Contract by Contractor shall be binding unless Lender has been given the required notice and has not cured the default within 30 calendar days. 21. REMEDIES. The parties hereto agree that Lender, while not a party to the Contract, is an intended third party beneficiary of the obligations imposed on Contractor in this Addendum. In the event of any breach or violation of any agreement or obligation of Contractor under the Contract or this Addendum, Lender may proceed with any of the following remedies: A. Bring an action in equitable relief seeking the specific performance by Contractor of the terms and conditions of the Contract or this Addendum, and/or enjoining, abating, or preventing any violation of said terms and conditions; B. Order immediate stoppage of rehabilitation and demand that any condition leading to the default be corrected before rehabilitation may continue; C. Enter the Property and take any actions necessary in its judgment to complete rehabilitation of the Project as permitted under the assignment of development rights; or Attachment No. 2 D. Pursue any other remedy allowed at law or in equity. 22. GOVERNING LAW. This Addendum shall be interpreted under and be governed by the laws of the State of California, except for those provisions relating to choice of law and those provisions preempted by federal law. 23. DEFINITIONS. Capitalized terms not defined in this Addendum shall have the same meaning as defined in the Loan Agreement. 24. ATTORNEYS' FEES AND COSTS. In the event any legal action is commenced to interpret or to enforce the terms of this Addendum, the prevailing party in any such action shall be entitled to recover all reasonable attorneys' fees and costs incurred in such action. 25. TIME. Time is of the essence in the performance of this Addendum by Contractor. 26. CONSENTS AND APPROVALS. Any consent or approval required under this Addendum shall not be unreasonably withheld, delayed, or conditioned. 27. BINDING UPON SUCCESSORS. All provisions of this Addendum shall be binding upon and inure to the benefit of the heirs, administrators, executors, successors -in -interest, transferees, and assigns of each of the parties; provided, however, that this section does not waive the prohibition on assignment of this Addendum by Contractor without Lender's consent. 28. RELATIONSHIP OF CONTRACTOR AND LENDER. Contractor understands that Lender neither undertakes nor assumes any responsibility or duty to Contractor or to any third party. The relationship of Contractor and Lender for this Project shall not be construed as a joint venture, equity venture, or partnership. Lender shall have no obligation to any party under the Contract, but is an intended third party beneficiary of the obligations under this Addendum. Contractor shall have no authority to act as an agent of Lender or to bind Lender to any obligation. 29. ASSIGNMENT. Contractor may not assign any of its interests under the Contract or the Addendum to any other party, except with the prior written consent of Lender. Any unauthorized assignment shall be void. 30. AMENDMENTS AND MODIFICATIONS. Any amendments or modifications to this Addendum must be in writing, and shall be made only if executed by Owner and Contractor, and consented to in writing by Lender. 31. SEVERABILITY. Every provision of this Addendum is intended to be severable. If any provision of this Addendum is held invalid, illegal, or unenforceable by a court of competent jurisdiction, the validity, legality, and enforceability of the remaining provisions shall not be affected or impaired. 32. ADDENDUM CONTROLS. In the event that any provisions of this Addendum and the Contract conflict, the terms of this Addendum shall control. [SIGNATURE BLOCKS ON NEXT PAGE] Attachment No. 2 IN WITNESS WHEREOF, the undersigned parties have executed this Construction Contract Addendum as of the date first written above. "CONTRACTOR" By: Title: "OWNER" VISTA DEL SOL APARTMENTS, L.P., a California limited partnership By: Vista Del Sol GP LLC, a California limited liability company, its general partner By: National Community Renaissance of California, a California nonprofit public benefit corporation, its managing member By: Its: Attachment No. 2 LOAN AGREEMENT (Vista Del Sol Apartments) EXHIBIT G INSURANCE REQUIREMENTS I. Insurance Coverage Requirements Borrower must procure, prior to Loan closing, and keep in force for the term of this Agreement, at Borrower's own cost and expense, the following policies of insurance or certificates or binders as necessary to represent that coverage as specified below is in place with companies doing business in California and acceptable to Lender. If requested, Borrower must provide Lender with copies of all insurance policies. The insurance must at a minimum include: A. Commercial General Liability insurance, shall cover liability arising from premises, operations, independent contractors, products -completed operations, personal and advertising injury, Bodily Injury, Broad Form Property Damage, and liability assumed under an insured contract (including the tort liability of another assumed in a business contract); Contractual Liability; XCU; and Owners and Contractor Protective Liability. Pollution Liability coverage is required if Loan proceeds are used for the remediation of Hazardous Materials. The CGL policy must contain severability of interest clause or cross liability clause or the equivalent thereof. If such CGL insurance contains a general aggregate limit, it shall apply separately to this Agreement. i. Coverage afforded on behalf of Lender shall be primary insurance and any other insurance available to Lender under any other policies shall be excess insurance (over the insurance required by this Agreement). ii. Limits of liability: Borrower must maintain commercial general liability (CGL) and, if necessary, commercial umbrella insurance with a limit of not less than $2,000,000 each occurrence. If such CGL insurance contains a general aggregate limit, it must apply separately to this project. B. Automobile Liability Insurance. Borrower shall maintain automobile liability insurance for bodily injury and property damage liability with a limit of not less than $1,000,000 each accident. Such insurance shall cover liability arising out of any auto (including owned, hired, and non -owned autos). Coverage shall be at least as broad as Insurance Services Office Form Number CA 00 01. C. Worker's Compensation insurance as required by the laws of the State of California. Statutory coverage may include Employers Liability coverage with limits not less than $1,000,000. Borrower certifies that it is aware of the provisions of section 3700 of the California Labor Code, which require every employer to provide Workers' Compensation coverage, or to undertake self-insurance in accordance with the provisions of that Code. Attachment No. 2 Borrower and its contractors must comply with the provisions of section 3700 of the California Labor Code before commencing performance of the work under this Agreement and thereafter as required by that code. D. Professional Liability/Errors and Omissions insurance as appropriate for design/build operations with limits not less than $2,000,000 each claim. If the professional liability/errors and omissions insurance is written on a claims made form: i. The retroactive date must be shown and must be before the date of the contract or the beginning of work. ii. Insurance must be maintained and evidence of insurance must be provided for at least three (3) years after completion of this Agreement. iii. If coverage is cancelled or non -renewed and not replaced with another claims made policy form with a retroactive date prior to the Agreement effective date, Borrower must purchase extended period coverage for a minimum of three (3) years after completion of work. E. Builders Risk/Course of Construction Insurance (CP 10 30) covering all risks of loss in an amount equal to the completed value form with no coinsurance penalty provisions and in an amount equal to the initial contract sum, subject to subsequent modification of the contract sum. The insurance shall apply on a replacement cost basis. The insurance shall name as insured the City of National City, the Borrower, and all subcontractors in the work. The insurance shall cover the entire work at the site identified herein including reasonable compensation for architectural services, engineering costs, financing costs, legal fees (soft costs) and expenses made necessary by an insured loss. Insured property shall include portions of the work located away from the site but intended for use at the site and shall also cover portions of the work in transit. The policy shall cover the cost of removing debris, including demolition as may be made legally necessary by the operation of any law, ordinance or regulation. The insurance shall be maintained in effect until the Project has been accepted as substantially complete. The insurer shall waive all rights of subrogation against the City. F. Property Insurance on an all risk coverage basis to the extent of full replacement value of the premises for the duration of the term of the Loan. Coverage amount may be adjusted for fluctuation in replacement values. This coverage is required upon completion of rehabilitation of the Project, or upon closing of this Loan if the Project is a rehabilitation project. G. Loss of Rents Insurance Coverage in the amount of 75% of scheduled annual gross rents. II. Terms, Conditions, and Endorsements The insurance required by this Agreement must be endorsed and have all the following Attachment No. 2 conditions: A. Insured Status (Additional Insured): Borrower shall provide insured status naming the City of National City, its councilmembers, directors, officers, agents, employees and volunteers as insured's under the Commercial General Liability policy. General Liability coverage can be provided in the form of an endorsement to Borrower's insurance (at least as broad as ISO Form CG 2010 (11/85) or both CG 2010 and CG 20 37 forms, if later revisions used). If Borrower submits the ACORD Insurance Certificate, the insured status endorsement must be set forth on an ISO form CG 20 10 (or equivalent). A STATEMENT OF ADDITIONAL INSURED STATUS ON THE ACORD INSURANCE CERTIFICATE FORM IS INSUFFICIENT AND WILL BE REJECTED AS PROOF OF MEETING THIS REQUIREMENT. B. Loss Payee: Borrower must ensure that the City of National City, its Councilmembers, directors, officers, agents, employees and volunteers are named as Loss Payee in the Builders' Risk Insurance and Property Insurance. Borrower shall provide appropriate Loss Payee endorsement as proof of meeting this requirement. C. Cancellation Notice: 30-day prior written notice of termination or material change in coverage and 10-day prior written notice of cancellation for non-payment. D. The Worker's Compensation policy shall be endorsed with a waiver of subrogation in favor of the City for all work performed by the contractor, its employees, agents and subcontractors. E. Cross -liability coverage as provided under standard ISO forms' separation of insureds clause. F. Certificate holder is to be the same person and address as indicated in the "Notices'" section of this Agreement. G. Insurer must carry an A.M. Best Rating of A VII, or better. III. Replacement of Coverage In the case of the breach of any of the insurance provisions of this Agreement, Lender may, at Lender's option, take out and maintain at the expense of Borrower such insurance in the name of Borrower as is required pursuant to this Agreement, and may deduct the cost of taking out and maintaining such insurance from any sums which may be found or become due to Borrower under this Agreement. IV. Insurance Interpretation Attachment No. 2 All endorsements, certificates, forms, coverage and limits of liability referred to herein shall have the meaning given such terms by the Insurance Services Office (ISO) as of the date of this Agreement. V. Proof of Insurance Borrower wiH be required to provide proof of all insurance required for the Loan prior to execution of the Loan Agreement, including copies of Borrower's insurance policies, if and when requested. Failure to provide the insurance proof requested or failure to do so in a timely manner shall constitute grounds for rescission of the Loan Agreement award. VI. Subcontractors Should Borrower subcontract out the work required under this Agreement, they shall include all subcontractors as insureds under its policies or shall maintain separate certificates and endorsements for each subcontractor. As an alternative, Borrower may require all subcontractors to provide at their own expense evidence of all the required coverages listed in this Exhibit. If this option is exercised, both Lender and Borrower shall be named as additional insured under the subcontractor's General Liability policy. All coverages for subcontractors shall be subject to all the requirements stated herein. Lender reserves the right to perform an insurance audit during the course of the project to verify compliance with requirements. VII. Deductibles and Self -Insured Retentions Any deductible or self -insured retentions must be declared to and approved by Lender. At the option of Lender, either: the insurer shall reduce or eliminate such deductible or self -insured retentions as respects Lender, its Councilmembers, directors, officers, agents, employees and volunteers; or Borrower shall provide a financial guarantee satisfactory to Lender guaranteeing payment of losses and related investigations, claim administration and defense expenses. VIII. Waiver of Subrogation Borrower waives all rights against the Community Development Commission -Housing Authority of the City of National City and its Councilmembers, officers, directors, employees and volunteers for recovery of damages to the extent these damages are covered by the forms of insurance coverage required above. IX. Evaluation of Adequacy of Coverage Lender maintains the right to modify, delete, alter or change these requirements, with reasonable notice, upon not less than ninety (90) days prior written notice. Attachment No. 2 NO FEE DOCUMENT Government Code Section 27383 Recording requested by: When recorded mail to: Community Development Commission of the City of National City 140 E. 12th Street, Suite B National City, CA 91950-3312 Attention: Executive Director AMENDED AND RESTATED REGULATORY AGREEMENT THE COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY AND VISTA DEL SOL APARTMENTS, L.P. Attachment No. 2 AMENDED AND RESTATED REGULATORY AGREEMENT This Amended and Restated Regulatory Agreement ("Regulatory Agreement") is dated as of the day of , 2017, by and between the Community Development Commission -Housing Authority of the City of National City (the "CDC -HA"), a public body, corporate and politic and Vista Del Sol Apartments, L.P. ("Owner"), a California limited partnership. RECITALS This Regulatory Agreement is entered into based on the following facts and understandings of the parties: A. Concurrently herewith Owner is acquiring all of the real property ("Property") described in that certain Regulatory Agreement and Declaration of Restrictive Covenants dated as of December 7, 1998, and recorded in the Office of the County Recorder for the County of San Diego on December 11, 1998 as Instrument Number 1998-0807600 ("Previous Regulatory Agreement") originally made by Copper Hills Apartments Limited Partnership, a California limited partnership ("Prior Owner") the Community Development Commission of the City of National City ("Original Lender"). Owner proposes to acquire and rehabilitate a 132-unit rental housing project the Proprty, which is commonly known as Vista Del Sol Apartments at 1400, 1401, 1410, 1421, 1433, 1436, 1438, 1440, 1445, 1536, 1537, 1538, 1543, 1545 and 1500 Q Avenue, National City, California, which is rented at amounts affordable to certain income groups as specified herein. B. The acquisition and proposed rehabilitation is intended to serve as a community resource by providing decent, safe, and sanitary housing for households who would otherwise be unable to afford such housing. The CDC -HA has previously provided the properties with fmancial assistance in the form of loans from public funds to support development of the properties, in order to increase and improve the supply of housing available in the community to low and moderate -income households. C. The CDC -HA elected to retain the housing assets of and functions previously performed by the Original Lender pursuant to California Health and Safety Code Section 34176, and thereby, by operation of law, the CDC -HA assumed the rights and obligations of the Original Lender with respect to the Previous Regulatory Agreement. D. Concurrently herewith the Owner is acquiring the Property from Prior Owner and the Owner is assuming all of the rights and liabilities of the Original Owner with respect to the Previous Regulatory Agreement. The CDC -HA and Owner desire to amend and restate the Previous Regulatory Agreement in its entirety, as provided herein. This Regulatory Agreement has also been executed and recorded pursuant to the requirements of California Health and Safety Code Section 33334.3. The purpose of this Regulatory Agreement is to regulate and restrict the occupancy, rents, operation, ownership, and management of the property for the benefit of project occupants and the people of the City of National City. The covenants in this Regulatory Agreement are intended to run with the land and be binding on Owner and Owner's successors to the land for the full term of this Regulatory Agreement. NOW, THEREFORE, in consideration of the foregoing recitals (which are hereby incorporated into this Agreement) and the covenants and mutual obligations contained in this Regulatory Agreement, and in reliance on the representations and warranties set forth herein, Owner and the CDC -HA hereby amend and restate the Previous Regulatory Agreement in its entirety and agree as follows: Attachment No. 2 DEFINITIONS 1. DEFINED TERMS. The following terms and their derivatives have the meanings set forth in this section wherever used in this Regulatory Agreement or attached exhibits. Capitalized terms not defined in this Regulatory Agreement shall have the same meaning as defined in the Loan Agreement: "CDC -HA" means the Community Development Commission -Housing Authority of the City of National City, a public body corporate and politic, along with any assigns, transferees, or successors -in - interest thereto. "City" means the City of National City. "Deed of Trust" means that certain Deed of Trust, Assignment of Rents, and Security Agreement placed on the Property concurrently herewith as security for the Loan and other obligations, with Owner as trustor and the CDC -HA as beneficiary, as well as any amendments to, modifications of, and restatements of the Deed of Trust. "Loan" means the loans provided by the CDC -HA to Owner's predecessor -in -interest as assumed by Owner in connection with the Property, in the current total amount of $7,407,795.08. "Loan Agreement" means that certain Amended and Restated Loan Agreement executed contemporaneous with this Regulatory Agreement between Owner and the CDC -HA which governs the Loan, as well as any amendments to, modifications of, or restatements of said agreement. "Loan Documents" mean collectively the Loan Agreement, Deed of Trust, and Note, as they may be amended, modified, or restated from time to time, along with all exhibits and attachments to these documents. "Note" mean that certain Consolidated, Amended and Restated Promissory Note executed by Owner in favor of the CDC -HA evidencing the Loan, which are secured by the Deed of Trust, as well as any amendments to, modifications of, or restatements of the Note. "Owner" means Vista Del Sol Apartments, L.P., a California limited partnership. "Project" means the rehabilitation of the Property for residential and other uses according to the terms of the Loan Agreement. "Project Unit" means any housing unit developed on the Property (but specifically excluding one unrestricted manager's unit). "Property" has the meaning ascribed to it in Recital A, above. AMENDED AND RESTATED AGREEMENT 2. TERMINATION OF PRIOR REGULATORY AGREEMENTS. This Regulatory Agreement amends and restates in its entirety the Previous Regulatory Agreement. The Previous Regulatory Attachment No. 2 Agreement is hereby terminated contemporaneously with execution of this Regulatory Agreement, and shall be of no further force or effect. OWNER'S OBLIGATIONS 3. COMPLIANCE WITH LOAN DOCUMENTS. Owner's actions with respect to the Property and the use of Loan funds must at all times be in full conformity with the requirements of the Loan Documents. Owner must complete the rehabilitation as required under the Loan Agreement. 4. TERM OF AGREEMENT. This Regulatory Agreement shall commence upon execution and shall continue until December 31, 2073. The obligations in this Regulatory Agreement shall remain effective and fully binding on the Property and the Owner, or Owner's successor in the event of any approved sale, assignment, transfer, or conveyance of the Property and release of the Owner (pursuant to the terms of the Loan Agreement and/or this Regulatory Agreement), for this full term regardless of any expiration of the term of the Loan, any payment or prepayment of the Loan, or any reconveyance of the Deed of Trust, unless terminated earlier by the CDC -HA in a recorded writing or extended by the mutual consent of the parties. PROJECT UNIT OCCUPANCY AND RENTS 5. USE COVENANT. Owner covenants by and for itself and any successors in interest that the use of the Property shall be restricted for the term of this Regulatory Agreement only to residential use and ancillary uses associated with residential use. 6. OCCUPANCY OF PROJECT UNITS. Owner must limit for the full term of this Regulatory Agreement the rental of Project Units to tenant households according to the occupancy requirements set forth in Exhibit A attached hereto. 7. RENTS FOR PROJECT UNITS. Owner must limit for the full term of this Regulatory Agreement rents for Project Units to those rents specified in Exhibit A and in conformance with the rent - setting requirements in Exhibit A. 8. RELATIONSHIP TO TAX CREDIT REQUIREMENTS. Notwithstanding any other provisions of this Regulatory Agreement, to the extent that the regulatory agreement executed by the Owner as a requirement of receiving the Tax Credits (the "Tax Credit Regulatory Agreement") is less restrictive with respect to the requirements applicable to tenant selection, tenant income levels and unit rent levels than as provided in this Regulatory Agreement, this Regulatory Agreement shall control. 9. NONDISCRIMINATION. Owner may not discriminate or segregate in the use, enjoyment, occupancy, conveyance, lease, sublease, or rental of Project Units on the basis of race, color, ancestry, national origin, religion, sex, sexual preference, age, marital status, family status, source of income, physical or mental disability, Acquired Immune Deficiency Syndrome (AIDS) or AIDS -related conditions (ARC), or any other arbitrary basis. Owner shall not refuse to lease Project Units to a certificate or voucher holder under the Section 8 Rental Certificate Program or the Section 8 Rental Voucher Program, or to the holder of a comparable document evidencing participation in a tenant -based rental assistance program, because of the status of the prospective tenant as a holder of such certificate, voucher, or comparable tenant -based assistance document. Owner shall include a statement in all advertisements, notices and signs for the availability of Project Units for rent to the effect that Owner is an Equal Housing Opportunity Provider. Attachment No. 2 10. LEASE REQUIREMENTS. Prior to rental of any of the Project Units, the Owner shall submit a standard lease form to the CDC -HA for the CDC -HA approval, which approval shall not unreasonably be withheld or delayed. The Owner shall enter into a lease, in the form approved by the CDC -HA, with each tenant of a Project Unit. PROPERTY MANAGEMENT 11. MANAGEMENT RESPONSIBILITIES. Owner is responsible for contracting with a property manager who will be responsible for all management functions with respect to the Property, including without limitation the selection of tenants, certification and recertification of household size and income, evictions, collection of rents and deposits, maintenance, landscaping, routine and extraordinary repairs, replacement of capital items, and security. The CDC -HA shall have no responsibility over management of the Property. 12. MANAGEMENT ENTITY. The CDC -HA shall have the right to review and approve, with at least 90-days advance written notice, the management entity chosen by Owner for the Property, and the right to require a change in the management agent for reasonable cause at any time during the term of this Regulatory Agreement; provided however, that if Owner's lender does not require such a change in the management agent, then Owner and the CDC -HA shall endeavor to reach an agreement mutually acceptable between the CDC -HA and the Owner's lender over the issue. Any contracting of management services by Owner shall not relieve Owner of its primary responsibilities for proper performance of management duties. 13. MANAGEMENT PLAN AND CONTRACT. At least 180 calendar days prior to completion of rehabilitation of the Project, Owner must submit to the CDC -HA for review and approval a plan for marketing and managing the Property (the "Final Management Plan" or "Plan"). The Plan shall address how the Owner and the management entity plan to manage and maintain the Property, and shall include appropriate financial information and documentation, including, without limitation, a rent schedule and a projected operating budget for the first year of operation. The Plan shall include a form rental agreement that Owner proposes to enter into with Project tenants. Owner shall abide by the terms of this Plan in marketing, managing, and maintaining the Property. At least 90 calendar days prior to completion of rehabilitation of the Project, Owner must submit a proposed management contract to the CDC -HA for the CDC-HA's review and approval. The CDC -HA shall have the right to review and approve, with at least 90-days advance written notice, any proposed amendments to said contract or any new management contracts during the term of this Regulatory Agreement. If the CDC -HA has not responded to any submission of the Final Management Plan or management contract (including amendments) by Owner within 15 business days of receipt of such Plan or contract by the CDC -HA, the Plan or contract (including amendments) shall be deemed approved by the CDC -HA. 14. ANNUAL OPERATING BUDGETS. At least 90 calendar days prior to the commencement of a Property's fiscal year, Owner shall submit to the CDC -HA for the CDC-HA's review and approval a proposed operating budget for the coming year, in a form satisfactory to the CDC -HA. The proposed operating budget shall include projected income from all sources, projected expenses, including operating expenses, debt service and deposits to reserves, and projected distributions including without limitation partnership management fees, asset management fees, deferred developer fees, and any other distributions to Owner or other parties. Attachment No. 2 If the CDC -HA has not responded to any submission of the proposed operating budget by Owner within 20 business days of receipt of such operating budget by the CDC -HA, the operating budget shall be deemed approved by the CDC -HA. 15. DOCUMENTS TO BE MAINTAINED ON SITE. Owner shall at all times maintain on a Property site, in the rental office or otherwise in the control of the property manager, copies of the current Final Management Plan and operating budget, and copies of all regulatory agreements and other documents imposing limitations on rent or occupancy of any Project Units. 16. MAINTENANCE AND SECURITY. Owner at its own expense must maintain the Property in good condition, in good repair, and in decent, safe, sanitary, habitable and tenantable living conditions for the benefit of Project Unit occupants. Owner may not commit or permit any waste on or to the Property, and shall prevent and/or rectify any physical deterioration of the Property. Owner must provide adequate ongoing security equipment and services for Project Unit occupants. Owner must maintain the Property in conformance with all applicable state, federal, and local laws, ordinances, codes, and regulations and the Final Management Plan; but Owner's maintenance obligations are not limited only to the standards contained in these laws or the Plan. In the event that Owner fails to maintain the Property in accordance with these standards and after at least seven calendar days prior notice to Owner, the CDC -HA or its agent may, but shall be under no obligation to, enter upon the Property, make such repairs or replacements as are deemed necessary in the CDC-HA's reasonable discretion, and provide for payment thereof. Any amount advanced by the CDC - HA to make such repairs, together with interest thereon from the date of such advance at the same rate of indebtedness as specified in the Note with the highest interest rate for the Project (unless payment of such an interest rate would be contrary to applicable law, in which case interest shall accrue at the highest rate then allowed by applicable law), shall become an additional obligation of Owner to the CDC -HA and shall be secured by the Deed of Trust. 17. REPLACEMENT RESERVES. Concurrently herewith, Owner shall deposit the sum of Two Hundred Thousand and No/100 Dollars ($200,000.00) into a replacement reserve (the "Replacement Reserve") for the Property. In addition, commencing on the month following conversion of the permanent financing, Owner must deposit each year into the Replacement Reserve a minimum amount equal to $300 per unit per year. Replacement reserves may be used for repairs or replacements at the Property. 18. OPERATING RESERVES. Commencing on the month following conversion of the permanent financing, Owner must deposit each month into an operating reserve for the Property a minimum amount equal to [2%] of the gross rental income from the Property, until the operating reserve is equal to at least three months of operating costs (including debt service) of the Property. Owner must maintain the operating reserve at that level, or, following draws on that reserve, must bring the reserve back up to that level from available sources within a reasonable time, for the term of this Regulatory Agreement. The CDC - HA must approve in advance any withdrawal from the replacement reserve or the operating reserve. 19. VACANCIES. Owner is required to use its best efforts to fill vacancies in Project Units as quickly as possible. Excessive or continuing Property vacancies shall constitute a breach of this Regulatory Agreement. 20. INSPECTION AND RECORDS. Owner must maintain records which clearly document Owner's performance of its obligations to operate the Property under the terms of this Regulatory Agreement. Owner must submit any Property -related records to the CDC -HA within ten business days of Attachment No. 2 the CDC -HA' s request. Owner shall permit representatives of the CDC -HA to enter and inspect the Property for compliance with obligations under this Regulatory Agreement upon 24 hours advance notice of such visit to Owner or Owner's management agent, as permitted under applicable law. 21. ANNUAL REPORTS. Owner must submit an annual report to the CDC -HA, on a form provided by the CDC -HA, which, at a minimum, shall state for each Assisted Unit the rental rate (including any rental assistance received on behalf of the tenant household) and the income, household size, race and ethnicity of the occupants. The income information required under this report shall be determined in accordance with the provisions of Exhibit A to this Agreement. In addition, Owner must submit an annual financial report for the Property to the CDC -HA, in a form reasonably satisfactory to the CDC -HA (but the CDC -HA shall not require that such report be audited), which includes an accounting of all revenue (including rental revenue, rental assistance payments and miscellaneous revenue), operating expenses, debt service payments, deposits to reserves and distributions to Owner or other parties. The report shall include certification of the required deposits to, withdrawals from and balances of the replacement and operating reserves. Commencing upon completion of rehabilitation, Owner shall pay to the CDC -HA an annual monitoring fee ("Loan Monitoring Fee"), as determined by the CDC -HA in schedules printed by the CDC - HA from time to time. The Loan Monitoring Fee shall be subject to revision annually. The Loan Monitoring Fee shall be paid to the CDC -HA annually within ten (10) days after the CDC -HA provides a written invoice to Owner for the same. Failure to timely pay the Loan Monitoring Fee shall constitute a material default under the Loan Agreement and this Regulatory Agreement. The Loan Monitoring Fee shall be paid to the CDC -HA as a consideration for the lending of funds by the CDC -HA to the Owner. 22. FEES, TAXES, AND OTHER LEVIES. Owner shall be responsible for payment of all fees, assessments, taxes, charges, liens and levies imposed by any public authority or utility company with respect to the Property, and shall pay such charges prior to delinquency. However, Owner shall not be required to pay any such charge so long as (a) the legality thereof is being contested in good faith and by appropriate proceedings, and (b) Owner maintains reserves adequate to pay any contested liabilities. 23. INSURANCE COVERAGE. Owner is required to have or cause to have in full force and effect during the term of this Regulatory Agreement insurance coverage as required under the Loan Agreement. 24. PROPERTY DAMAGE OR DESTRUCTION. If any building or improvements erected by Owner on the Property is damaged or destroyed, Owner must, at its own cost and expense, repair or restore the Property consistent with the original Plans and Specifications for the Project. Such work shall be commenced within 120 days after the damage or loss occurs and shall be completed within one year thereafter. All insurance proceeds collected for such damage or destruction shall be applied to the cost of such repairs or restorations. GENERAL PROVISIONS 25. TRANSFER AND ENCUMBRANCE OF PROPERTY. During the term of this Regulatory Agreement, and except as otherwise permitted herein or in the Loan Agreement, Owner may not make or permit any sale, agreement to sell, assignment, conveyance, further encumbrance, lease (other than the rental of Project Units to eligible residential tenant occupants), or transfer the Property or any part thereof, including any substantial change in operational or management control over the Property (collectively referred to as "Transfers"), without the prior written consent of the CDC -HA in its sole discretion. Any such unauthorized Transfer shall be void. Notwithstanding the foregoing, the transfers of Attachment No. 2 limited partnership interests to affiliates and the removal of the general partner as set forth in the Loan Agreement shall be permitted without CDC -HA consent. Owner shall be permitted to refinance senior debt with the prior written consent of the CDC -HA, which consent will not be unreasonably withheld, conditioned or delayed, provided however, Owner shall be permitted to refinance senior debt without the consent of the CDC -HA only if: (i) the monthly payment amount of the new debt does not exceed the monthly payment amount of the senior debt; and (ii) the original principal amount of the new debt does not exceed the then outstanding principal balance of the senior debt. The CDC -HA shall take all steps and execute all documents which may be reasonably necessary to subordinate the applicable deed of trust to the lien securing such new loan, provided the aforementioned conditions are satisfied. 26. DEFAULT AND REMEDIES. A breach of any agreement, obligation, or warranty under this Regulatory Agreement shall be an Owner default. The CDC -HA shall give written notice to Owner of any such default. Said notice shall specify the nature of the act, omission, or deficiency giving rise to the default. In addition, if the default is curable and does not give rise to an imminent danger to health or safety, then the notice shall also specify the action required to cure the default. If the default is not cured within 30 calendar days or the Borrower does not commence such cure within 30 calendar days and diligently pursue the cure to completion within a reasonable time thereafter, the CDC -HA may proceed with all of its rights and remedies under the terms of the Loan Agreement, this Regulatory Agreement or at law, including without limitation, any of the following: A. Bring an action for equitable relief seeking the specific performance by Owner of the terms and conditions of this Regulatory Agreement, and/or enjoining, abating, or preventing any violation of said terms and conditions, and/or seeking declaratory relief; B. Enter upon, take possession of, and manage a Property, either in person, by agent, or by a receiver appointed by a court, and collect any rents, income, deposits, or reserves and apply them to operate the Property, and continue in possession until such time as the CDC -HA in its reasonable judgment determines that Owner is in a position to operate the Property in compliance with this Regulatory Agreement; C. Make such repairs or replacements to a Property as are necessary and provide for payment thereof; or D. Pursue any other remedy allowed at law or in equity. 27. NON -LIABILITY OF OFFICIALS, EMPLOYEES AND AGENTS. No member, official, officer, director, employee, or agent of the CDC -HA or the City shall be personally liable to Owner for any obligation created under the terms of this Regulatory Agreement, except in the case of actual fraud or willful misconduct by such person. 28. INDEMNITY. Notwithstanding the insurance coverage required herein, Owner hereby indemnifies and holds the CDC -HA, the City, and their respective members, officials, officers, directors, employees, and agents (collectively, the "Indemnified Parties") harmless from any losses, damages, liabilities, claims, demands, judgments, actions, court costs, and legal or other expenses (including reasonable attorneys' fees) which an Indemnified Party may incur as a result of (1) Owner's failure to perform any obligations as and when required by this Regulatory Agreement; or (2) any failure of Owner's representations or warranties to be true and complete; or (3) any act or omission by Owner or any contractor, subcontractor, management agent, or supplier with respect to the Property, except to the extent that such losses are caused by the negligence or willful misconduct of the CDC -HA. Owner shall pay Attachment No. 2 immediately upon an Indemnified Party's demand any amounts owing under this indemnity. The duty of the Owner to indemnify includes the duty to defend the Indemnified Party in any court action, administrative action, or other proceeding brought by any third party arising from the Property. Owner's duty to indemnify an Indemnified Party shall survive the term of this Regulatory Agreement. 29. GOVERNING LAW. This Regulatory Agreement shall be interpreted under and be governed by the laws of the State of California, except for those provisions relating to choice of law and those provisions preempted by federal law. 30. REGULATORY AGREEMENT CONTROLS. In the event that any provisions of this Regulatory Agreement and the Loan Agreement conflict, the terms of this Regulatory Agreement shall control. 31. ATTORNEYS' FEES AND COSTS. In the event that a legal or administrative action is brought to interpret or enforce the terms of this Regulatory Agreement, the prevailing party shall be entitled to recover all reasonable attorneys' fees and costs incurred in such action. 32. TIME. Time is of the essence in the performance of this Regulatory Agreement by Owner and the CDC -HA. 33. CONSENTS AND APPROVALS. Any consent or approval required under this Regulatory Agreement shall not be unreasonably withheld, delayed, or conditioned. 34. NOTICES, DEMANDS AND COMMUNICATIONS. Formal notices, demands and communications between Owner and the CDC -HA shall be given by registered or certified mail, postage prepaid, return receipt requested, or delivered personally, to the principal offices of Owner and the CDC - HA as follows, or if any such office is relocated, to the new address specified by the relocated party: CDC -HA: Community Development Commission -Housing Authority of the City of National City 140 East 12th Street National City, CA 91950-3312 Attn: Executive Director OWNER: Vista Del Sol Apartments, L.P. 9421 Haven Avenue Rancho Cucamonga, CA 91730 35. BINDING UPON SUCCESSORS; COVENANTS TO RUN WITH THE LAND. All provisions of this Regulatory Agreement shall be binding upon and inure to the benefit of the heirs, administrators, executors, successors -in -interest, transferees, and assigns of Owner and the CDC -HA, regardless of any assignment, payment, prepayment, expiration, extinguishment of the Loan or Note, any reconveyance of the Deed of Trust, or any conveyance or transfer of the Property. Any successor -in - interest to Owner and any purchaser or transferee of the Property shall be subject to all of the duties and obligations imposed on Owner under this Regulatory Agreement for the full term of this Regulatory Agreement. The term "Owner" as used in this Regulatory Agreement shall include all such assigns, successors -in -interest, and transferees. Upon the transfer of a Property, the transferring Owner shall be released from all obligations and liabilities hereunder. Attachment No. 2 The parties intend that the covenants contained in this Regulatory Agreement shall constitute covenants running with the land and shall bind the Property during the term of this Agreement. Owner agrees for itself and for its successors that in the event that a court of competent jurisdiction determines that the covenants herein do not run with the land, such covenants shall be enforced as equitable servitudes against the Property. 36. RELATIONSHIP OF PARTIES. The relationship of Owner and the CDC -HA with respect to the Property during the term of this Regulatory Agreement shall not be construed as a joint venture, equity venture, or partnership. The CDC -HA neither undertakes nor assumes any responsibility or duty to Owner or to any third party with respect to the operation of the Property or the actions of Owner. Except as the CDC -HA may specify in writing, Owner shall have no authority to act as an agent of the CDC -HA or to bind the CDC -HA to any obligation. 37. WAIVER. Any waiver by the CDC -HA of any obligation in this Regulatory Agreement must be in writing. No waiver will be implied from any delay or failure by the CDC -HA to take action on any breach or default of Owner or to pursue any remedy allowed under this Regulatory Agreement or applicable law. Any extension of time granted to Owner to perform any obligation under this Regulatory Agreement shall not operate as a waiver or release from any of its obligations under this Regulatory Agreement. Consent by the CDC -HA to any act or omission by Owner shall not be construed to be a consent to any other or subsequent act or omission or to waive the requirement for the CDC-HA's written consent to future waivers. 38. OTHER AGREEMENTS. Owner represents that it has not entered into any agreements that would restrict or compromise its ability to comply with the terms of this Regulatory Agreement. Owner shall not enter into any agreements that are inconsistent with the terms of this Regulatory Agreement without an express written waiver by the CDC -HA. 39. AMENDMENTS AND MODIFICATIONS. Any amendments or modifications to this Regulatory Agreement must be in writing, and shall be effective only if executed by both Owner and the CDC -HA. 40. SEVERABILITY. Every provision of this Regulatory Agreement is intended to be severable. If any provision of this Agreement is held invalid, illegal, or unenforceable by a court of competent jurisdiction, the validity, legality, and enforceability of the remaining provisions shall not be affected or impaired. 41. EXHIBIT. The following Exhibit is attached to this Regulatory Agreement and is hereby incorporated into this Loan Agreement by reference: Exhibit A: Occupancy and Rent Restrictions 42. COUNTERPARTS. This Regulatory Agreement may be signed in multiple counterparts, which, when signed by all parties, shall constitute a binding agreement. [SIGNATURE BLOCKS ON NEXT PAGE] Attachment No. 2 IN WITNESS WHEREOF, the undersigned parties have executed this Regulatory Agreement, effective as of the date first written above. "OWNER" VISTA DEL SOL APARTMENTS, L.P., a California limited partnership By: Vista Del Sol GP LLC, a California limited liability company, its general partner By: National Community Renaissance of California, a California nonprofit public benefit corporation, its managing member By: Its: [SIGNATURES CONTINUED ON FOLLOWING PAGE] Attachment No. 2 "CDC -HA" THE COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY, a public body corporate and politic By: Its: Executive Director Approved as to form and legality: By: Deputy City Attorney ISIGNATURE(S) MUST BE ACKNOWLEDGED] Attachment No. 2 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of ) On before me, , Notary Public, personally appeared, , who proved to me the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her their authorized capacity(ies), and that by his/her/their signature (s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under penalty of perjury under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature Attachment No. 2 AMENDED AND RESTATED REGULATORY AGREEMENT EXHIBIT A OCCUPANCY AND RENT RESTRICTIONS 1. Definitions. For purposes of this Exhibit A, the following terms have the following meanings: (i) "Lower Income Household (60% AMI)" shall mean a household earning not greater than sixty percent of Los Angeles County median income, adjusted for family size, as set forth from time to time by regulation of the California Department of Housing and Community Development. (ii) "Rent" shall mean the total of monthly payments by the tenants of a Project Unit for use and occupancy for the Project Unit and facilities associated therewith, including a reasonable allowance for utilities for an adequate level of service, as defined in 25 California Code of Regulations Section 6918. (iii) "Very Low Income Household (50% AMI)" shall mean a household earning not greater than the applicable percentage of Los Angeles County median income for very low income households, adjusted for family size, as set forth by regulation of the California Department of Housing and Community Development, pursuant to Health and Safety Code Section 50105. 2. Number of Affordable Units. Owner agrees to make available, restrict occupancy to, and rent (a) one hundred three (103) of the Project Units to Lower Income (60% AMI) Households, and (b) twenty-seven (27) of the Project Units to Very Low Income (50% AMI) Households, all at an Affordable Rent. At least sixty-two (62) of the Housing Units rented to Lower Income Household (60% AMI) shall be one bedroom units, and at least sixteen (16) of the Housing Units rented to Very Low Income Households (50% AMI) shall be one bedroom units. No more than two units may be set aside for managers and maintenance personnel. 3. Selection of Tenants. Owner shall be responsible for the selection of tenants for the Project Units in compliance with lawful and reasonable criteria, and in accordance with the procedures set forth in the Management Plan which is submitted to and approved by the CDC - HA in accordance with the terms of the Loan Documents. 4. Household Income Requirements. Following the initial lease -up of the Project Units, and annually thereafter, the Owner shall submit to the CDC -HA, at Owner's expense, a summary of the income, household size and rent payable by each of the tenants of the Project Units. At the CDC-HA's request, the Owner shall also provide to the CDC -HA completed income computation and certification forms, in a form acceptable to the CDC -HA, for any such tenant or tenants. Owner shall, prior to the initial leasing of a Project Unit and on an annual basis thereafter, obtain a certification from each tenant leasing a Project Unit demonstrating that such tenant is a Very Low Income Household (50% AMI) or Lower Income Household (60% AMI), as applicable, and meets the eligibility requirements established for the Project Unit. Owner shall Attachment No. 2 verify the income of each proposed and existing tenant of the Project Units in the Project by at least one of the following methods as appropriate: (i) obtain two (2) paycheck stubs from the person's two (2) most recent pay periods. (ii) obtain a true copy of an income tax return from the person for the most recent tax year in which a return was filed. (iii) obtain an income verification certification from the employer of the person. (iv) obtain an income verification certification from the Social Security Administration and/or the California Department of Social Services if the person receives assistance from such agencies. (v) obtain an alternate form of income verification reasonably acceptable to the Agency, if none of the above forms of verification is available to the Owner. 5. Determination of Affordable Rent for the Project Units. Each Project Unit which is restricted hereunder shall be rented at an "Affordable Rent" to be established as provided herein. (i) The maximum monthly Rent for the Project Units to be rented to Very Low Income Households (50%) shall be established at one -twelfth (1/12) of thirty percent (30%) of fifty percent (50%) of Los Angeles County median income for a family of a size appropriate to the Project Unit (as defined in Health and Safety Code Section 50053). (ii) The maximum monthly Rent for the Project Units to be rented to Lower Income Households (60% AMI) shall be established at one -twelfth (1/12) of thirty percent (30%) of sixty percent (60%) of Los Angeles County median income for a family of a size appropriate to the Project Unit (as defined in Health and Safety Code Section 50053). 6. Occupancy Standards. Occupancy of one bedroom Project Units shall be limited to three persons, occupancy of two bedroom Project Units shall be limited to five persons and occupancy of three bedroom Project Units shall be limited to seven persons. Attachment No. 2 NO FEE DOCUMENT Government Code Section 27383 Recording requested by: Community Development Commission of the City of National City When recorded mail to: Community Development Commission of the City of National City 140 E. 12th Street, Suite B National City, CA 91950-3312 Attention: Executive Director DEED OF TRUST, ASSIGNMENT OF RENTS, AND SECURITY AGREEMENT (Securing loan of $7,578,996) This Deed of Trust, Assignment of Rents, and Security Agreement ("Deed of Trust") is dated as of the 12th day of December, 2017, by Vista Del Sol Apartments, L.P., a California limited partnership ("Trustor" or "Borrower), to Fidelity National Title Company as trustee ("Trustee"), for the benefit of Community Development Commission -Housing Authority of the City of National City, a public body, corporate and politic ("Beneficiary" or "Lender"). This Deed of Trust is being executed in order to secure Beneficiary's interest as a governmental agency in ensuring both that public funds loaned for project development are repaid, and that housing projects assisted by public funds are developed and operated in a manner that is consistent with the public interest. GRANT IN TRUST 1. GRANT. Trustor, in consideration of the indebtedness referred to below, hereby irrevocably grants and conveys to Trustee, IN TRUST, WITH POWER OF SALE, for the benefit and security of Beneficiary, all of Trustor's interest in the land and improvements on the property located in the City of National City, County of San Diego, State of California, and described in the attached Exhibit A, incorporated herein by this reference (the "Property"), which is located at the following street address: 1400, 1401, 1410, 1421, 1433, 1436, 1438, 1440, 1445, 1536, 1537, 1538, 1543, 1545 and 1500 Q Avenue, National City, California; TOGETHER WITH all interest, estates or other claims, both in law and in equity which Trustor now has or may hereafter acquire in the Property; all buildings, structures, fixtures, improvements, signs, and landscaping now or hereafter erected or located on the Property, including all equipment and machinery used for supplying or distributing heating, cooling, electricity, gas, water, air, and light, all kitchen and laundry appliances such as washers, dryers, refrigerators, garbage disposals, ovens, ranges, dishwashers, all plumbing and bathroom fixtures, all security and access control equipment, fire prevention and extinguishment equipment, elevators, floor coverings, window coverings, paneling, cabinets, (provided, however, that Trustor shall have the right to remove, if necessary, such fixtures, furnishings, and equipment for the purpose of replacement with similar items of the same quality performing the same functions, which replacements shall themselves become part of this grant); all building material and Attachment No. 2 equipment either now or hereafter delivered to the Property and intended to be installed therein or any such material and equipment purchased with Loan proceeds whether or not located on the Property; all reserves, accounts, deferred payments, and refunds relating to development on the Property; all rents and income generated by the Property or improvements thereon (subject however to the assignment of rents to Lender contained herein); all leases, subleases and rental agreements covering the Property or any portion thereof now existing or hereafter entered into, and all interests of Trustor in security deposits, advance rentals, accounts, or payments of similar nature with respect to such leases, subleases, or rental agreements; all easements and rights -of -way appurtenant to the Property, including parking and recreational easements, and all interests of Trustor in any land lying within the right-of-way of any street, sidewalks, and areas of land adjacent to or used in connection with the Property; all development rights and credits, air rights, water rights, and oil, gas or mineral rights with respect to the Property; all claims or demands with respect to insurance proceeds, and all awards made for a taking by eminent domain; all interests and rights in any private or government grants, subsidies, loans, or other financing with respect to development on the Property; all interests in personal property used in and about the Property (except furniture and other personal property of occupants of dwelling units on the Property); all intangible property and rights relating to the Property or operations on the Property, including trade names, goodwill, trademarks, and service marks; all government permits, approvals, and map rights related to construction on the Property; all architectural, structural, and mechanical plans, specifications, designs, studies, and data with respect to construction of improvements on the Property; all environmental tests, studies and reports with respect to the Property; all current and future claims and rights of action of Trustor against prior owners and operators of the Property, neighboring property owners and operators, tenants and former tenants, consultants, advisors, and other third parties with respect to environmental or Hazardous Materials contamination and cleanup of the Property under any federal, state, or local ordinances, statutes, regulations, or administrative decisions or common law. All of the foregoing, together with the Property, is herein referred to as the "Security." OBLIGATIONS SECURED 2. Trustor makes this grant for the purpose of securing the following obligations: A. Repayment of the indebtedness of Trustor to Beneficiary in the principal sum of [Seven Million Five Hundred Seventy -Eight Thousand Nine Hundred Ninety -Six and 00/100 Dollars ($7,578,996)] with interest thereon (the "Loan") evidenced by that certain Consolidated, Amended and Restated Promissory Note of even date herewith executed by Trustor (the "Note," on file at the offices of Beneficiary, which is hereby incorporated into this Deed of Trust by this reference), along with any extensions, amendments, modifications, or renewals to the Note; and B. Payment of any sums advanced by Beneficiary to protect the security and priority of this Deed of Trust; and C. Payment of any sums advanced by Beneficiary following a breach of Trustor's obligation to advance such sums and the expiration of any applicable cure period, with interest thereon as provided herein; and D. Performance of every obligation, covenant or agreement of Trustor contained in this Deed of Trust, the Note, and that certain Amended and Restated Loan Agreement of even date herewith executed between Trustor and Beneficiary for the Loan (the "Loan Agreement", on file at the offices of Beneficiary, which is hereby incorporated into this Deed of Trust Attachment No. 2 by this reference), including all modifications, extensions and renewals of these obligations; and E. Performance of any other obligation or repayment of any other indebtedness of Trustor to Beneficiary, where such evidence of obligation or indebtedness specifically recites that it is secured by this Deed of Trust; F. Performance of any obligations of Trustor under that certain Amended and Restated Regulatory Agreement among Trustor, Beneficiary and the City of National City covering the Project or the Security (the "Regulatory Agreement"). ABSOLUTE ASSIGNMENT OF RENTS AND RIGHT TO POSSESSION 3. ASSIGNMENT. As additional security, Trustor hereby assigns to Beneficiary: (a) all of the rents, revenues, profits, and income from the Security, any deposits now or hereafter in Trustor's possession which have been collected with respect to the Security, and any reserve or capital funds now or hereafter held by Trustor with respect to construction or operation of the Security (collectively, the "Rents"); and (b) the right to enter, take possession of, and manage the Security; provided however that Trustor shall have, before an Event of Default, the exclusive right to possess the Security and to collect Rents and use them in accordance with the Loan Documents. This assignment is intended to be an absolute and present transfer of Trustor's interest in existing and future Rents, effective as of the date of this Deed of Trust. 4. ENFORCEMENT. Upon the happening of an Event of Default which has not been cured in the manner and time provided in the Loan Agreement, Beneficiary may, in addition to other rights and remedies permitted by the Loan Agreement, this Deed of Trust, or applicable law, (a) enter upon, take possession of, and manage the Security, either in person as a mortgagee -in -possession, by agent, or by a receiver appointed by a court, and do any acts which it deems necessary or desirable to preserve the value, marketability or rentability of the Security, (b) collect all Rents, including those past due and unpaid, and apply the same to pay for the costs and expenses of operation of the Security, including attorneys' fees, and pay off any indebtedness secured by this Deed of Trust, all in such order as Beneficiary may determine, and/or (c) enter upon and take possession of the Security. Beneficiary may make, cancel, enforce, and modify leases and rental agreements, obtain and evict tenants, set and modify rent terms, sue for rents due, enter into, modify, or terminate any contracts or agreements, or take any legal action, as it deems necessary with respect to the Rents or to development or operation of the Security. 5. APPOINTMENT OF A RECEIVER. In any action to enforce this assignment, Beneficiary may apply for the appointment of a receiver to take possession of the Security and take whatever measures are necessary to preserve and manage the Security for the benefit of Beneficiary and the public interest. Trustor hereby consents to the appointment of a receiver. The receiver shall have all of the authority over the Security that Beneficiary would have if Beneficiary took possession of the Security under this assignment as a mortgagee -in -possession, including the right to collect and apply Rents and the right to complete construction of improvements. 6. NO WAIVER OF POWER OF SALE. The entering upon and taking possession of the Security and the collection of Rents shall not cure or waive any default or notice of default hereunder or invalidate any act done in response to such default or notice of default and, notwithstanding the continuance in possession of the Security or the collection and application of Rents, Beneficiary shall be entitled to exercise every right provided for in this Deed of Trust or by law upon occurrence of any Event of Default, including the right to exercise the power of sale. Attachment No. 2 COMMERCIAL CODE SECURITY AGREEMENT 7. GRANT. This Deed of Trust is intended to be a security agreement and financing statement pursuant to the California Commercial Code for any of the items specified above as part of the Security which under applicable law may be subject to a security interest pursuant to the Commercial Code, and Trustor hereby grants Beneficiary a security interest in said items. Beneficiary may file a copy of this Deed of Trust in the real estate records or other appropriate index as a financing statement for any of the items specified as part of the Security. Trustor shall exr le and deliver to Beneficiary at Beneficiary's request any financing statements, as well as extensions, i ,vals, and amendments thereof, and copies of this instrument in such form as Beneficiary may require to perfect a security interest with respect to said items. Trustor shall pay all costs of filing such financing statements and shall pay all reasonable costs of any record searches for financing statements and releases. Without the prior written consent of Beneficiary, Trustor shall not create or permit any other security interest in said items. 8. REMEDIES. Upon Trustor's breach of any obligation or agreement in the Loan Documents, Beneficiary shall have the remedies of a secured party under the Commercial Code and at Beneficiary's option may also invoke the remedies provided for elsewhere in this Deed of Trust with respect to said items. Beneficiary may proceed against the items of real property and personal property specified above separately or together and in any order whatsoever. RIGHTS AND OBLIGATIONS OF TRUSTOR 9. PERFORMANCE OF SECURED OBLIGATION. Trustor must perform each obligation secured by this Deed of Trust within the time provided herein. 10. PAYMENT OF PRINCIPAL AND INTEREST. Trustor must pay the principal and interest on the indebtedness evidenced by the Note when required under the Note. 11. MAINTENANCE OF THE SECURITY. Trustor must, at the Trustor's own expense, maintain and preserve the Security or cause the Security to be maintained and preserved as required under the Regulatory Agreement. Trustor may not commit or permit material waste on or to the Security. Trustor may not abandon the Security. Beneficiary shall have no responsibility over maintenance of the Security. In the event Trustor fails to maintain the Security in accordance with the standards in the Regulatory Agreement, Beneficiary may take such action with respect thereto as is provided in the Regulatory Agreement and any amount so advanced by Beneficiary, together with interest thereon from the date of such advance at the same rate of indebtedness as specified in the Note with the highest interest rate (unless payment of such an interest rate would be contrary to applicable law, in which case interest shall accrue at the highest rate then allowed by applicable law), shall become an additional obligation of Trustor to Beneficiary and shall be secured by this Deed of Trust. 12. INSPECTION OF THE SECURITY. Trustor must permit Beneficiary to enter and inspect the Security for compliance with these obligations upon one business day's advance written notice of such visit by Beneficiary to Trustor. 13. LIENS, ENCUMBRANCES, AND CHARGES. Trustor must discharge any lien or encumbrance not approved by Beneficiary in writing that may attain priority over this Deed of Trust, as provided for in the Loan Agreement, provided Trustor will have the right to reasonably contest same in good faith, provided, however, Beneficiary hereby approves those liens and encumbrances approved by Beneficiary as exceptions in the policy of title insurance that insures the validity and priority of this Deed of Trust (the "Permitted Encumbrances"). Attachment No. 2 14. DEFENSE AND NOTICE OF CLAIMS AND ACTIONS. Trustor must appear in and defend, at its own expense, any action or proceeding purporting to affect the Security and/or the rights of Beneficiary. Trustor must give Beneficiary and Trustee prompt notice in writing of the assertion of any claim, of the filing of any action or proceeding and of any condemnation offer or action with respect to the Security not filed by the Beneficiary or the City of National City. 15. SUITS TO PROTECT THE SECURITY. Beneficiary shall have the power, after at least thirty (30) days' prior written notice to Trustor, to institute and maintain such suits and proceedings as it may deem reasonably necessary: (a) to prevent any impairment of the Security or the rights of Beneficiary, (b) to preserve or protect its interest in the Security and in the Rents, and (c) to restrain the enforcement of or compliance with any governmental legislation, regulation, or order, if the enforcement of or compliance with such legislation, regulation, or order would impair the Security or be prejudicial to the interest of Beneficiary, and provided nothing contained herein will be construed as a waiver of Trustor's rights to contest any relevant governmental legislation, regulation, or order. 16. DAMAGE TO SECURITY. Trustor must give Beneficiary prompt notice in writing of any damage to the Security. If any building or improvements erected on the Property is damaged or destroyed, Trustor shall comply with any relevant provisions of the Regulatory Agreement that may require repair or reconstruction of the Property. 17. TITLE. Trustor warrants that Trustor lawfully has legal title to the Security without any limitation on the right to encumber. 18. GRANTING OF EASEMENTS. Trustor may not grant easements, licenses, rights -of -way or other rights or privileges in the nature of easements with respect to the Security except those reasonably required or desirable for installation and maintenance of utilities including water, gas, electricity, sewer, cable television, telephone, or telecommunications, those required by law and those otherwise necessary or desirable for the use or development of the Property, including the Permitted Encumbrances. 19. TAXES AND LEVIES. Trustor shall pay prior to delinquency, all taxes, fees, assessments, charges, liens and levies imposed by any public authority or utility company which are or may become a lien affecting the Security. However, Trustor shall not be required to pay any tax, assessment, charge or levy so long as (a) the legality thereof shall be promptly and actively contested in good faith and by appropriate proceedings, and (b) Trustor maintains reserves adequate to pay any contested liabilities. In the event that Trustor fails to pay any of the foregoing items and is not contesting such items in good faith, Beneficiary may, but shall be under no obligation to, pay the same, after Beneficiary has provided ten (10) days' written notice to Trustor of such failure to pay and Trustor fails to fully pay such items within the ten (10) day period after receipt of such notice. Any amount so advanced by Beneficiary, together with interest thereon from the date of such advance at the same rate of interest specified in the Note with the highest interest rate (unless payment of such an interest rate would be contrary to applicable law, in which case interest shall accrue at the highest rate then allowed by applicable law), shall become an additional obligation of Trustor to Beneficiary and shall be secured by this Deed of Trust. Beneficiary's payment of any tax, assessment or charge will not be deemed to waive any right Trustor may have to contest any relevant tax, assessment or charge. 20. INSURANCE. Trustor must provide such insurance as required under the Loan Agreement or Regulatory Agreement, or otherwise required under any Senior Lien (as defined herein), provided the rights of Beneficiary in the proceeds of any insurance shall be subject to the rights of any Senior Lender on the terms provided in any Subordination Agreement (as defined herein) or if not specified therein, in the Attachment No. 2 Regulatory Agreement. In the event Trustor fails to maintain the full insurance coverage required by this Deed of Trust, Beneficiary, after at least ten (10) days' prior written notice to Trustor, may, but shall be under no obligation to, take out the required policies of insurance and pay the premiums on such policies. Any amount so advanced by Beneficiary, together with interest thereon from the date of such advance at the same rate of interest specified in the Note with the highest interest rate (unless payment of such an interest rate would be contrary to applicable law, in which case interest shall accrue at the highest rate then allowed by applicable law), shall become an additional obligation of Trustor to Beneficiary and shall be secured by this Deed of Trust. 21. DAMAGES; INSURANCE AND CONDEMNATION PROCEEDS. (a) All judgments, awards of damages, settlements and compensation made in connection with or in lieu of taking any part of or interest in the Security under assertion of the power of eminent domain ("Funds") are hereby assigned to and shall be paid to Beneficiary. Beneficiary is authorized (but not required) to receive any Funds and is authorized to apply any such Funds to any indebtedness or obligation secured hereby, in such order and manner as Beneficiary determines. Any part of the Funds may be released to Trustor upon such conditions as Beneficiary may impose for its disposition. Application or release of any Funds shall not cure or waive any default under this Deed of Trust. The rights of Beneficiary under this paragraph are expressly subject to the rights of any Senior Lender in any such proceeds. (b) The following (whether now existing or hereafter arising) are all absolutely and irrevocably assigned by Trustor to Beneficiary and, at the request of Beneficiary, shall be paid directly to Beneficiary (i) all awards of damages and all other compensation payable directly or indirectly by reason of a condemnation or proposed condemnation for public or private use affecting all or any part of, or any interest in, the Subject Property (ii) all other claims and awards for damages to, or decrease in value of, all or any part of, or any interest in, the Subject Property; (iii) all proceeds of any insurance policies payable by reason of loss sustained to all or any part of the Subject Property; and (iv) all interest which may accrue on any of the foregoing. Subject to applicable law, and without regard to any requirement contained in Section 5.7(d), Beneficiary may at its discretion apply all or any of the proceeds it receives to its expenses in settling, prosecuting or defending any claim and may apply the balance to the Secured Obligations in any order, and/or Beneficiary may release all or any part of the proceeds to Trustor upon any conditions Beneficiary may impose. Beneficiary may commence, appear in, defend or prosecute any assigned claim or action and may adjust, compromise, settle and collect all claims and awards assigned to Beneficiary; provided, however, that if Beneficiary fails to pursue any such claim, Beneficiary shall assign or permit Trustor to pursue such claim upon Trustor's request, and in no event shall Beneficiary be responsible for any failure to collect any claim or award, regardless of the cause of the failure. (c) Beneficiary shall permit insurance or condemnation proceeds held by Beneficiary to be used for repair or restoration but may condition such application upon reasonable conditions, including, without limitation: (i) the deposit with Beneficiary of such additional funds which Beneficiary determines are needed to pay all cost of the repair or restoration, (including, without limitation, taxes, financing charges, insurance and rent during the repair period); (ii) the establishment of an arrangement for lien releases and disbursement of funds acceptable to Beneficiary; (iii) the delivery to Beneficiary of plans and specifications for the work, a contract for the work signed by a contractor acceptable to Beneficiary, a cost breakdown for the work and a payment and performance bond for the work, all of which shall be acceptable to Beneficiary; and (iv) the delivery to Beneficiary of evidence acceptable to Beneficiary (aa) that after completion of the work the income from the Subject Property will be sufficient to pay all expenses and debt service for Attachment No. 2 the Subject Property; (bb) of the continuation of Leases acceptable to and required by Beneficiary; (cc) that upon completion of the work, the size, capacity and total value of the Subject Property will be at least as great as it was before the damage or condemnation occurred, subject to City laws, ordinances, regulations and standards then in effect; (dd) that there has been no material adverse change in the financial condition or credit of Trustor since the date of this Deed of Trust; and (ee) the satisfaction of any additional conditions that Beneficiary may reasonably establish to protect its security. Trustor hereby acknowledges that the conditions described above are reasonable. 22. ACCELERATION ON TRANSFER OF SECURITY. In the event that Trustor, without the prior written consent of Beneficiary, sells, agrees to sell, transfers, or conveys its interest in the Security or any part thereof in violation of the Loan Agreement, Beneficiary may, at its option, declare all sums secured by this Deed of Trust to be immediately due and payable. 23. RECONVEYANCE BY TRUSTEE. This trust is intended to continue for the entire term of the Loan. Upon written request of Beneficiary stating that all sums secured by this Deed of Trust have been paid and upon surrender of this Deed of Trust to Trustee for cancellation and retention, and upon payment by Trustor of Trustee's reasonable fees, Trustee shall reconvey the Security to Trustor, or to the person or persons legally entitled thereto. DEFAULT AND REMEDIES 24. EVENTS OF DEFAULT. Any of the events listed in the Loan Agreement as an Event of Default shall also constitute an Event of Default under this Deed of Trust, including, but not limited to, (1) Trustor's failure to pay within ten (10) days after written notice of nonpayment by Beneficiary, any sums payable under this Deed of Trust, the Note, or the Loan Agreement, subject to any cure or grace period herein or therein; (2) Trustor's failure to observe or to perform any of its other covenants, agreements or obligations under this Deed of Trust, the Note, or the Loan Agreement; or (3) Trustor's failure to make any payment or perform any of its other covenants, agreements, or obligations under any Senior Lien (as defined herein) with respect to the Project or the Security, after expiration of any applicable notice and/or cure period provided in the relevant Senior Lien. Trustor shall have the full cure period provided in the Loan Agreement for defaults thereunder, to cure any default under this Deed of Trust. 25. RIGHTS OF OTHER LENDERS. Beneficiary shall provide concurrent notice of any default under this Deed of Trust to any lender having a lien secured by the Property of which Beneficiary has written notice, and such lender will have the longer of (a) any cure period provided in the Loan Documents or (b) thirty (30) days after the date of any such notice, to cure the relevant default. 26. ACCELERATION OF MATURITY. Upon the happening of an Event of Default which has not been cured within the times and in the manner provided in the Loan Agreement or in this Deed of Trust, Beneficiary may declare all sums advanced to Trustor under the Note and this Deed of Trust immediately due and payable. 27. BENEFICIARY'S REMEDIES. Upon the happening of an Event of Default which has not been cured within the times and in the manner provided in the Loan Agreement, Beneficiary may, in addition to other rights and remedies permitted by the Loan Agreement, the Note, or applicable law, and subject to the rights of any Senior Lender proceed with any of the following remedies: Attachment No. 2 A. Enforce the assignment of rents and right to possession as provided for in this Deed of Trust, and/or seek appointment of a receiver to take over possession of the Security and collect Rents; B. Enter the Security and take any actions necessary in its judgment to complete rehabilitation of the Security as permitted under the Loan Agreement and the assignment of rents and right to possession in this Deed of Trust, either in person or through a receiver appointed by a court; D. Commence an action to foreclose, judicially or nonjudicially, this Deed of Trust and/or seek appointment of a receiver from a court of competent jurisdiction with the authority to protect Beneficiary's interests in the Security, including the authority to complete construction of improvements; E. Deliver to Trustee a written declaration of Default and demand for sale, and a written Notice of Default and election to cause Trustor's interest in the Security to be sold, which notice Trustee or Beneficiary shall duly file for record in the official records of San Diego County, and exercise its power of sale as provided for below; or F. Pursue any other rights and remedies allowed at law or in equity. 28. FORECLOSURE BY POWER OF SALE. Should Beneficiary elect to foreclose by exercise of the power of sale contained in this Deed of Trust, Beneficiary shall notify Trustee. Upon receipt of such notice from Beneficiary, Trustee shall cause to be recorded, published and delivered to Trustor such Notice of Default and Election to Sell as then required by law and by this Deed of Trust. Trustee shall, without demand on Trustor, after lapse of such time as may then be required by law and after recordation of such Notice of Default and after Notice of Sale having been given as required by law, sell the Security, at the time and place of sale fixed by it in the Notice of Sale. The sale of the Security shall be as a whole or in separate lots or parcels or items as Trustee shall deem expedient and in such order as it may determine unless specified otherwise by Trustor, at public auction to the highest bidder for cash in lawful money of the United States payable at the time of sale. Trustee shall deliver to the purchaser its deed or deeds conveying the property so sold, but without any covenant or warranty, express or implied. The recitals in such deed of any matters of facts shall be conclusive proof of the truthfulness thereof. Any person, including, without limitation, Trustor, Trustee, or Beneficiary, may purchase at the sale. Trustee may postpone sale of the Security by public announcement at such time and place of sale, and from time to time may postpone the sale by public announcement at the time and place fixed by the preceding postponement, or may, in its discretion, give a new Notice of Sale. After deducting all reasonable costs and fees of Trustee, including costs of evidence of title in connection with such sale, Trustee shall apply the proceeds of sale as follows: (i) first, to payment of all sums then secured by this Deed of Trust, in such order and amounts as Beneficiary in its sole discretion determines, and (ii) the remainder, if any, to the person or persons legally entitled thereto. 29. REMEDIES CUMULATIVE. No right, power or remedy conferred upon Beneficiary by this Deed of Trust is intended to be exclusive of any other rights, powers or remedies, but each such right, power and remedy shall be cumulative and concurrent and shall be in addition to any other right, power and remedy given hereunder or existing at law or in equity. Attachment No. 2 GENERAL PROVISIONS 30. GOVERNING LAW. This Deed of Trust shall be interpreted under and governed by the laws of the State of California, except for those provisions relating to choice of law and those provisions preempted by federal law. 31. ATTORNEYS' FEES AND COSTS. In the event of any Event of Default, or any legal or administrative action is commenced to interpret or to enforce the terms of this Deed of Trust, the prevailing party in such action shall be entitled to recover all reasonable attorneys' fees and costs in such action. Any such amounts paid by Beneficiary shall be added to the indebtedness secured by the lien of this Deed of Trust. 32. STATEMENT OF OBLIGATION. Beneficiary may collect a reasonable fee not to exceed the maximum allowable under applicable law for furnishing a statement of obligations as provided in the California Civil Code. 33. NOTICES, DEMANDS AND COMMUNICATIONS. Formal notices, demands and communications between Trustor and Beneficiary shall be given as provided for in the Loan Agreement. 34. BINDING UPON SUCCESSORS. All provisions of this Deed of Trust shall be binding upon and inure to the benefit of the heirs, administrators, executors, successors -in -interest, transferees, and assigns of Trustor, Trustee, and Beneficiary. 35. WAIVER. Any waiver by Beneficiary of any obligation of Trustor in this Deed of Trust must be in writing. No waiver will be implied from any delay or failure by Beneficiary to take action on any breach or default of Trustor or to pursue any remedy allowed under the Deed of Trust or applicable law. Any extension of time granted to Trustor to perform any obligation under this Deed of Trust shall not operate as a waiver or release Trustor from any of its obligations under this Deed of Trust. Consent by Beneficiary to any act or omission by Trustor shall not be construed as a consent to any other or subsequent act or omission or to waive the requirement for Beneficiary's written consent to future waivers. 36. AMENDMENTS AND MODIFICATIONS. Any amendments or modifications to this Deed of Trust must be in writing, and shall be made only if mutually agreed upon by Beneficiary and Trustor. 37. LOAN AGREEMENT CONTROLS. If there is any contradiction between this instrument and the Loan Agreement, the terms of the Loan Agreement shall control, except that Trustor shall have no defense or claim that this instrument does not establish a valid lien on the Property or the Security. 38. DEFINITIONS. Capitalized terms not otherwise defined in this Deed of Trust shall have the same meaning as defined in the Loan Agreement. 39. PROOFS OF CLAIM. In the case of any receivership, insolvency, bankruptcy, reorganization, arrangement, adjustment, recomposition or other proceedings affecting Trustor, its creditors or its property, Trustee, to the extent permitted by law, shall be entitled to file such proofs of claim and other documents as may be necessary or advisable in order to have the claims of Beneficiary allowed in such proceedings and for any additional amount which may become due and payable by Trustor hereunder after such date. Attachment No. 2 40. SEVERABILITY. Every provision of this Deed of Trust is intended to be severable. If any term or provision of this Deed of Trust is declared to be illegal, invalid, or unenforceable by a court of competent jurisdiction, the legality, validity, and enforceability of the remaining provisions shall not be affected. If the lien of this Deed of Trust is invalid or unenforceable as to any part of the debt or the Security, the unsecured or partially secured portion of the debt and all payments made on the debt (whether voluntary or under foreclosure or other enforcement action or procedure) shall be considered to have been first applied to the payment of that portion of the debt which is not secured by the lien of this Deed of Trust. 41. SUBSTITUTION OF TRUSTEES. Beneficiary may from time to time appoint another trustee to act in the place of Trustee or any successor. Upon such appointment and without conveyance, the successor trustee shall be vested with all title, powers, and duties conferred upon Trustee. Each such appointment and substitution shall be made by a written instrument executed by Beneficiary containing reference to this Deed of Trust and its place of record, which when duly recorded in the San Diego County Office of the Recorder shall be conclusive proof of proper appointment of the successor trustee. 42. ACCEPTANCE BY TRUSTEE. Trustee accepts this Trust when this Deed of Trust, duly executed and acknowledged, is made public record as provided by law. Except as otherwise provided by law, Trustee is not obligated to notify any party hereto of pending sale under this Deed of Trust or of any action or proceeding in which Trustor, Beneficiary, or Trustee shall be a party unless brought by Trustee. IN WITNESS WHEREOF, Trustor has executed this Deed of Trust as of the day and year first above written. "TRUSTOR" VISTA DEL SOL APARTMENTS, L.P., a California limited partnership By: Vista Del Sol GP LLC, a California limited liability company, its general partner By: National Community Renaissance of California, a California nonprofit public benefit corporation, its manager By: Its: JSIGNATURE(S) MUST BE ACKNOWLEDGED]. Attachment No. 2 A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of On before me, , Notary Public, personally appeared, who proved to me the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her their authorized capacity(ies), and that by his/her/their signature (s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under penalty of perjury under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature Attachment No. 2 EXHIBIT A PROPERTY DESCRIPTION (Vista Del Sol Apartments) (attached) Attachment No. 2 RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: Ann J. McGill Kutak Rock LLP 1650 Farnam Street Omaha, Nebraska 68102 SUBORDINATION AGREEMENT THIS SUBORDINATION AGREEMENT (this "Agreement") is made effective as of December 1, 2017 by and between the CALIFORNIA MUNICIPAL FINANCE AUTHORITY, a public body, corporate and politic, duly organized and existing under the laws of the State of California (the "Authority") and the COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY, a public body, corporate and politic (the "Subordinate Lender"). RECITALS A. Vista del Sol Apartments, L.P., a California limited partnership ("Borrower") is the owner of a fee simple interest in that certain real property described in Exhibit A attached hereto (the "Land") upon which Borrower intends to rehabilitate a 132-unit multifamily housing facility and related facilities (the "Improvements" and together with the Land, collectively, the "Property"). B. Pursuant to the terms of a Continuing Covenant Agreement dated December 1, 2017 (as amended, modified or supplemented from time to time, the "Continuing Covenant Agreement"), Borrower has requested that Pacific Western Bank, a California state -chartered bank (the "Bank") make a loan (the "Bank Loan") to the Authority, the proceeds of which will be used by the Authority to make a loan to Borrower in the amount of Sixteen Million and No/100 Dollars ($16,000,000.00) (the "Authority Loan"), which Authority Loan will be evidenced by a promissory note from Borrower to the Authority December 1, 2017 (as amended, modified or supplemented from time to time, the "Borrower Note"). The Borrower's obligations under the Borrower Note and the Continuing Covenant Agreement will be secured by a Deed of Trust, Security Agreement, Absolute Assignment of Leases and Rents and Fixture Filing dated as of the date hereof and recorded concurrently herewith (as amended, modified or supplemented from time to time, the "Senior Deed of Trust"), encumbering the Property and certain other property as more particularly described in the Deed of Trust. The Bank Loan and the Authority Loan shall sometimes be collectively referred to herein as the "Senior Loan." The Authority and the Bank shall be collectively referred to herein as "Senior Lender." The Borrower Note, the Continuing Covenant Agreement, the Senior Deed of Trust, this Agreement and any of the other documents evidencing or related to the Senior Loan are collectively referred to herein as the "Senior Loan Documents." Attachment No. 2 C. Subordinate Lender previously made a loan to Borrower's successor -in -interest, which loan is being assumed concurrently herewith, pursuant to the terms of an Amended and Restated Loan Agreement dated December 12, 2017 (as amended, modified, or supplemented from time to time, the "Subordinate Loan Agreement"), in the amount of $7,407,796.00 (the "Subordinate Loan"), which Subordinate Loan will be evidenced by a Consolidated, Amended and Restated Promissory Note Secured by a Deed of Trust dated December 12, 2017 (as amended, modified, or supplemented from time to time, the "Subordinate Note"). As a condition of the Subordinate Loan, Borrower will be required to execute and record that certain Amended and Restated Regulatory Agreement dated December 12, 2017, recorded concurrently herewith (the "Regulatory Agreement"). The Borrower's obligations under the Subordinate Loan Agreement, Subordinate Note and Regulatory Agreement will be secured by a Deed of Trust, Assignment of Rents and Security Agreement dated as of December 12, 2017, recorded concurrently herewith (as amended, modified or supplemented from time to time, the "Subordinate Deed of Trust") encumbering the Property and certain other property as more particularly described in the Subordinate Deed of Trust. The Subordinate Loan Agreement, Subordinate Note, Regulatory Agreement, Subordinate Deed of Trust and any of the other documents evidencing or related to the Subordinate Loan shall be collectively referred to herein as the "Subordinate Loan Documents." D. The execution and delivery of this Agreement by Subordinate Lender is a condition precedent to the making of the Senior Loan. AGREEMENTS NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which are acknowledged, the parties agree as follows: 1. Definitions. As used herein, the following terms have the meanings set forth below: "Bankruptcy Proceeding" means any bankruptcy, reorganization, insolvency, composition, restructuring, dissolution, liquidation, receivership, assignment for the benefit of creditors, or custodianship action or proceeding under any federal or state law with respect to Borrower, any guarantor of any of the Senior Loan, any of their respective properties, or any of their respective partners, members, officers, directors, or shareholders. "Business Day(s)" shall have the meaning assigned to such term in the Continuing Covenant Agreement. "Casualty" means the occurrence of damage to or loss of all or any portion of the Property by fire or other casualty. "Condemnation" means any action or proceeding or notice relating to any proposed or actual condemnation or other taking, or conveyance in lieu thereof, of all or any part of the Project, whether direct or indirect. "Enforcement Action" means any of the following actions taken by or at the direction of Subordinate Lender: the acceleration of all or any part of the Subordinate Loan, the advertising Attachment No. 2 of or commencement of any foreclosure or trustee's sale proceedings, the exercise of any power of sale, the acceptance of a deed or assignment in lieu of foreclosure or sale, the collecting of Rents, the obtaining of or seeking of the appointment of a receiver, the seeking of default interest, the taking of possession or control of any of the Property, the commencement of any suit or other legal, administrative, or arbitration proceeding based upon the Subordinate Loan Documents, the exercising of any banker's lien or rights of set-off or recoupment, or the exercise of any other remedial action against Borrower, any other party liable for the Subordinate Loan or obligated under any of the Subordinate Loan Documents, or the Property. "Enforcement Action Notice" means a written notice from Subordinate Lender to Senior Lender, given following one or more Subordinate Loan Default(s) and the expiration of any notice or cure periods provided for such Subordinate Loan Default(s) in the Subordinate Loan Documents, setting forth in reasonable detail the Subordinate Loan Default(s) and the Enforcement Actions proposed to be taken by Subordinate Lender. "Loss Proceeds" means all monies received or to be received under any insurance policy, from any condemning authority, or from any other source, as a result or any Condemnation or Casualty. "Rents" will have the meaning given to that term in the Continuing Covenant Agreement. "Senior Loan Default" means any act, failure to act, event, condition, or occurrence which constitutes, or which with the giving of Notice or the passage of time, or both, would constitute, an "Event of Default" as defined in the Senior Loan Documents. "Subordinate Loan Default" means any act, failure to act, event, condition, or occurrence which allows (but for any contrary provision of this Agreement), or which with the giving of Notice or the passage of time, or both, would allow (but for any contrary provision of this Agreement), Subordinate Lender to take an Enforcement Action. 2. Subordination of Subordinate Loan. a. The Subordinate Loan is and will at all times continue to be subject and subordinate in right of payment to the prior payment in full of the Senior Loan. b. Until the occurrence of an Event of Default (as defined in the Senior Loan Documents) under the Senior Loan Documents, Subordinate Lender will be entitled to retain for its own account all payments made on account of the principal of and interest on the Subordinate Loan in accordance with the requirements of the Subordinate Loan Documents. However, immediately upon Subordinate Lender's receipt of Notice (as defined herein) or actual knowledge of an Event of Default, Subordinate Lender will not accept any payments on account of the Subordinate Loan, and the provisions of Section 2(c) of this Agreement will apply. Subordinate Lender acknowledges that a Subordinate Loan Default constitutes a Senior Loan Default. Accordingly, upon the occurrence of a Subordinate Loan Default, Subordinate Lender will be deemed to have actual knowledge of a Senior Loan Default. Attachment No. 2 c. If (i) Subordinate Lender receives any payment, property, or asset of any kind or in any form on account of the Subordinate Loan (including any proceeds from any Enforcement Action) after a Senior Loan Default of which such Subordinate Lender has actual knowledge (or is deemed to have actual knowledge as provided in 2(b) above) or has been given Notice, or (ii) Subordinate Lender receives, voluntarily or involuntarily, by operation of law or otherwise, any payment, property, or asset in or in connection with any Bankruptcy Proceeding, such payment, property, or asset will be received and held in trust for Senior Lender. Subordinate Lender will promptly remit, in kind and properly endorsed as necessary, all such payments, properties, and assets to Senior Lender. Senior Lender will apply any payment, asset, or property so received from Subordinate Lender to the Senior Loan in such order, amount (with respect to any asset or property other than immediately available funds), and manner as Senior Lender determines in its sole and absolute discretion. d. Without limiting the complete subordination of the Subordinate Loan to the payment in full of the Senior Loan, in any Bankruptcy Proceeding, upon any payment or distribution (whether in cash, property, securities, or otherwise) to creditors (i) the Senior Loan will first be paid in full in cash before Subordinate Lender will be entitled to receive any payment or other distribution on account of or in respect of the Subordinate Loan, and (ii) until all of the Senior Loan is paid in full in cash, any payment or distribution to which Subordinate Lender would be entitled but for this Agreement (whether in cash, property, or other assets) will be made to Senior Lender. e. The subordination of the Subordinate Loan will continue if any payment under the Senior Loan Documents (whether by or on behalf of Borrower, as proceeds of security or enforcement of any right of set-off or otherwise) is for any reason repaid or returned to Borrower or its insolvent estate, or avoided, set aside or required to be paid to Borrower, a trustee, receiver or other similar party under any bankruptcy, insolvency, receivership or similar law. In such event, any or all of the Senior Loan originally intended to be satisfied will be deemed to be reinstated and outstanding to the extent of any repayment, return, or other action, as if such payment on account of the Senior Loan had not been made. 3. Subordination of Subordinate Loan Documents. a. Each of the Subordinate Loan Documents is, and will at all times remain, subject and subordinate in all respects to the liens, terms, covenants, conditions, operations, and effects of each of the Senior Loan Documents. b. The subordination of the Subordinate Loan Documents and of the Subordinate Loan will apply and continue notwithstanding (i) the actual date and time of execution, delivery, recording, filing or perfection of each of the Senior Loan Documents and of each of the Subordinate Loan Documents, and (ii) the availability of any collateral to Senior Lender, including the availability of any collateral other than the Property. c. By reason of, and without in any way limiting, the full subordination of the Subordinate Loan and the Subordinate Loan Documents provided for in this Agreement, all rights and claims of Subordinate Lender under the Subordinate Loan Documents in or to all or Attachment No. 2 any portion of the Property are expressly subject and subordinate in all respects to the rights and claims of Senior Lender under the Senior Loan Documents in or to the Property. d. If Subordinate Lender, by indemnification, subrogation or otherwise, acquires any lien, estate, right or other interest in any of the Property, then that lien, estate, right or other interest will be fully subject and subordinate to the receipt by Senior Lender of payment in full of the Senior Loan, and to the Senior Loan Documents, to the same extent as the Subordinate Loan and the Subordinate Loan Documents are subordinate pursuant to this Agreement. 4. Additional Representations and Covenants. a. Subordinate Lender represents and warrants with respect to the Subordinate Loan that each of the following is true: i. Subordinate Lender is now the owner and holder of the Subordinate Loan Documents. ii. The Subordinate Loan Documents are now in full force and effect. iii. The Subordinate Loan Documents have not been modified or amended. iv. To the best of its knowledge, no Subordinate Loan Default has occurred with respect to the Subordinate Loan. v. To the best of its knowledge, none of the rights of Subordinate Lender under any of the Subordinate Loan Documents are subject to the rights of any third parties, by way of subrogation, indemnification or otherwise. b. Without the prior written consent of Senior Lender in each instance, Subordinate Lender will not do any of the following: i. Amend, modify, waive, extend, renew, or replace any provision of any of the Subordinate Loan Documents. ii. Pledge, assign, transfer, convey, or sell any interest in the Subordinate Loan or any of the Subordinate Loan Documents. iii. Accept any payment on account of the Subordinate Loan other than a regularly scheduled payment of interest or principal and interest made not earlier than 10 days prior to its due date, or as expressly authorized in Section 4(i) below. iv. Take any action which has the effect of increasing the amount of the Subordinate Loan. v. Appear in, defend or bring any action to protect Subordinate Lender's interest in the Property. Attachment No. 2 vi. Take any action concerning the presence of any Hazardous Substance affecting the Property. As used in this Section 4(b), the term "Hazardous Substance" means and includes asbestos or any substance containing asbestos, polychlorinated biphenyls, any explosives, radioactive materials, chemicals known or suspected to cause cancer or reproductive toxicity, pollutants, effluents, contaminants, emissions, infectious wastes, any petroleum or petroleum -derived waste or product or related materials and any items defined as hazardous, special or toxic materials, substances or waste under any Hazardous Substance Law, or any such material which shall be removed from the Property pursuant to any administrative order or enforcement proceeding or in order to place the Property in a condition that is suitable for ordinary use. "Hazardous Substance Law" collectively means and includes any present and future local, state, federal or international law or treaty relating to public health, safety or the environment including without limitation, the Resource Conservation and Recovery Act, as amended ("RCRA"), 42 U.S.C. § 6901 et seq., the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA"), 42 U.S.C. § 9601 et seq., as amended by the Superfund Amendments and Reauthorization Act of 1986 ("SARA"), the Hazardous Materials Transportation Act, 49 U.S.C. § 1801 et seq., the Clean Water Act, 33 U.S.C. § 1251 et seq., the Clean Air Act, as amended 42 U.S.C. § 7401 at seq., the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq., the Safe Drinking Water Act, 42 U.S.C. § 300f et seq., the Uranium Mill Tailings Radiation Control Act, 42 U.S.C. § 7901 et seq., the Occupational Safety and Health Act, 29 U.S.C. § 655 et seq., the Federal Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. § 136 et seq., the National Environmental Policy Act, 42 U.S.C. § 4321 et seq., the Noise Control Act, 42 U.S.C. § 4901 et seq., and the Emergency Planning and Community Right -to -Know Act, 42 U.S.C. § 11001 et seq., and the amendments, regulations, orders, decrees, permits, licenses or deed restrictions now or hereafter promulgated thereunder, and any similar law, regulation, order, decree, permit, license or deed restriction of the State of California. c. Subordinate Lender will deliver to Senior Lender a copy of each Notice received or delivered by Subordinate Lender pursuant to the Subordinate Loan Documents or in connection with the Subordinate Loan, simultaneously with Subordinate Lender's delivery or receipt of such Notice. Senior Lender will deliver to Subordinate Lender in the manner required in Section 5(b) a copy of each Notice of a Senior Loan Default delivered to Borrower by Senior Lender. Neither giving nor failing to give a Notice to Senior Lender or Subordinate Lender pursuant to this Section 4(c) will affect the validity of any Notice given by Senior Lender or Subordinate Lender to Borrower, as between Borrower and such of Senior Lender or Subordinate Lender as provided the Notice to Borrower. d. Without the prior written consent of Senior Lender in each instance, Subordinate Lender will not commence, or join with any other creditor in commencing, any Bankruptcy Proceeding. In the event of a Bankruptcy Proceeding, Subordinate Lender will not vote Attachment No. 2 affirmatively in favor of any plan of reorganization or liquidation unless Senior Lender has also voted affirmatively in favor of such plan. In the event of any Bankruptcy Proceeding, Subordinate Lender will not contest the continued accrual of interest on the Senior Loan, in accordance with and at the rates specified in the Senior Loan Documents, both for periods before and for periods after the commencement of such Bankruptcy Proceedings. e. [Reserved.] f. All requirements pertaining to insurance under the Subordinate Loan Documents (including requirements relating to amounts and types of coverages, deductibles and special endorsements) will be deemed satisfied if Borrower complies with the insurance requirements under the Senior Loan Documents and of Senior Lender. All original policies of insurance required pursuant to the Senior Loan Documents will be held by Senior Lender. Nothing in this Section 4(f) will preclude Subordinate Lender from requiring that it be named as a mortgagee and loss payee, as its interest may appear, under all policies of property damage insurance maintained by Borrower with respect to the Property, provided such action does not affect the priority of payment of Loss Proceeds, or that Subordinate Lender be named as an additional insured under all policies of liability insurance maintained by Borrower with respect to the Property. g• apply: In the event of a Condemnation or a Casualty, all of the following provisions will The rights of Subordinate Lender to participate in any proceeding or action relating to a Condemnation or a Casualty, or to participate or join in any settlement of, or to adjust, any claims resulting from a Condemnation or a Casualty, will be and remain subordinate in all respects to Senior Lender's rights under the Senior Loan Documents with respect thereto, and Subordinate Lender will be bound by any settlement or adjustment of a claim resulting from a Condemnation or a Casualty made by Senior Lender. ii. All Loss Proceeds will be applied either to payment of the costs and expenses of restoration or to payment on account of the Senior Loan, as and in the manner determined by Senior Lender in its sole discretion. iii. If Senior Lender applies or releases Loss Proceeds for the purposes of restoration of the Property, then Subordinate Lender will release for such purpose all of their right, title and interest, if any, in and to such Loss Proceeds. If Senior Lender holds Loss Proceeds, or monitors the disbursement thereof, Subordinate Lender will not do so. Nothing contained in this Agreement will be deemed to require Senior Lender to act for or on behalf of Subordinate Lender in connection with any restoration or to hold or monitor any Loss Proceeds in trust for or otherwise on behalf of Subordinate Lender, and all or any Loss Proceeds may be commingled with any funds of Senior Lender. Attachment No. 2 iv. If Senior Lender elects to apply Loss Proceeds to payment on account of the Senior Loan, and if the application of such Loss Proceeds results in the payment in full of the entire Senior Loan, any remaining Loss Proceeds held by Senior Lender will be paid to Subordinate Lender unless another party has asserted a claim to the remaining Loss Proceeds. h. Except as provided in this Section 4(h), and regardless of any contrary provision in the Subordinate Loan Documents, Subordinate Lender will not collect payments for the purpose of escrowing for any cost or expense related to the Property ("Impositions") or for any portion of the Subordinate Loan. However, if Senior Lender is not collecting escrow payments for one or more Impositions, Subordinate Lender may collect escrow payments for such Impositions; provided that all payments so collected by Subordinate Lender will be held in trust by Subordinate Lender to be applied only to the payment of such Impositions. i. Within ten (10) Business Days after request by Senior Lender, Subordinate Lender will furnish Senior Lender with a statement, duly acknowledged and certified setting forth the then -current amount and terms of the Subordinate Loan, confirming that there exists no default under the Subordinate Loan Documents (or describing any default that does exist), and certifying to such other information with respect to the Subordinate Loan as Senior Lender may request. j. Senior Lender may amend, waive, postpone, extend, renew, replace, reduce or otherwise modify any provisions of the Senior Loan Documents without the necessity of obtaining the consent of or providing Notice to Subordinate Lender, and without affecting any of the provisions of this Agreement. Notwithstanding the foregoing, Senior Lender may not modify any provision of the Senior Loan Documents that increases the amount of the Senior Loan, except for increases in the Senior Loan that result from advances made by Senior Lender to protect the security or lien priority of Senior Lender under the Senior Loan Documents or to cure defaults under the Subordinate Loan Documents. 5. Default under Loan Documents. a. For a period of ninety (90) days following delivery to Senior Lender of an Enforcement Action Notice, Senior Lender will have the right, but not the obligation, to cure any Subordinate Loan Default, provided that if such Subordinate Loan Default is a non -monetary default and is not capable of being cured within such 90-day period and Senior Lender has commenced and is diligently pursuing such cure to completion, Senior Lender will have such additional period of time as may be required to cure such Subordinate Loan Default or until such time, if ever, as Senior Lender (i) discontinues its pursuit of any cure and/or (ii) delivers to Subordinate Lender Senior Lender's written consent to the Enforcement Action described in the Enforcement Action Notice. Senior Lender will not be subrogated to the rights of Subordinate Lender under the Subordinate Loan Documents by reason of Senior Lender having cured any Subordinate Loan Default. However, Subordinate Lender acknowledges that all amounts advanced or expended by Senior Lender in accordance with the Senior Loan Documents or to cure a Subordinate Loan Default will be added to and become a part of the Senior Loan and will be secured by the lien of the Senior Deed of Trust. Attachment No. 2 b. Senior Lender will deliver to Subordinate Lender a copy of any Notice sent by Senior Lender to Borrower of a Senior Loan Default within ten (10) Business Days of sending such Notice to Borrower. Failure of Senior Lender to send Notice to Subordinate Lender will not prevent the exercise of Senior Lender's rights and remedies under the Senior Loan Documents. Subordinate Lender will have the right, but not the obligation, to cure any monetary Senior Loan Default within thirty (30) days following the date of such Notice; provided, however, that Senior Lender will be entitled during such 30-day period to continue to pursue its remedies under the Senior Loan Documents. Subordinate Lender may, within ninety (90) days after the date of the Notice, cure a non -monetary Senior Loan Default if during such 90-day period, Subordinate Lender keeps current all payments required by the Senior Loan Documents. If such a non - monetary Senior Loan Default creates an unacceptable level of risk relative to the Property, or Senior Lender's secured position relative to the Property, as determined by Senior Lender in its sole discretion, then during such 90-day period Senior Lender may exercise all available rights and remedies to protect and preserve the Property and the Rents, revenues and other proceeds from the Property. Subordinate Lender will not be subrogated to the rights of Senior Lender under the Senior Loan Documents by reason of Subordinate Lender having cured any Senior Loan Default. However, Senior Lender acknowledges that all amounts paid by Subordinate Lender to Senior Lender to cure a Senior Loan Default will be deemed to have been advanced by such Subordinate Lender pursuant to, and will be secured by the lien of, the Subordinate Loan Documents. Notwithstanding anything in this Section 5(b) to the contrary, Subordinate Lender's right to cure any Senior Loan Default will terminate immediately upon the occurrence of any Bankruptcy Proceeding. c. In the event of a Subordinate Loan Default, Subordinate Lender will not commence any Enforcement Action until ninety (90) days after Subordinate Lender has delivered to Senior Lender an Enforcement Action Notice with respect to such Enforcement Action, provided that during such 90-day period or such longer period as provided in Section 5(a), Subordinate Lender will be entitled to seek specific performance to enforce covenants and agreements of Borrower relating to income, rent, or affordability restrictions contained in the Regulatory Agreement, subject to Senior Lender's right to cure a Subordinate Loan Default set forth in Section 5(a). Subordinate Lender may not commence any other Enforcement Action, including any foreclosure action under the Subordinate Loan Documents, until the earlier of (i) the expiration of such 90-day period or such longer period as provided in Section 5(a), or (ii) the delivery by Senior Lender to Subordinate Lender of Senior Lender's written consent to such Enforcement Action by such Subordinate Lender. Subordinate Lender acknowledges that Senior Lender may grant or refuse consent to Subordinate Lender's Enforcement Action in Senior Lender's sole and absolute discretion. At the expiration of such 90-day period or such longer period as provided in Section 5(a) and, subject to Senior Lender's right to cure set forth in Section 5(a), Subordinate Lender may commence any Enforcement Action. Any Enforcement Action on the part of Subordinate Lender will be subject to the provisions of this Agreement. Subordinate Lender acknowledges that the provisions of this Section 5(c) are fair and reasonable under the circumstances, that Subordinate Lender has received a substantial benefit from Senior Lender having granted its consent to the Subordinate Loan, and that Senior Lender would not have granted such consent without the inclusion of these provisions in this Agreement. d. Senior Lender may pursue all rights and remedies available to it under the Senior Loan Documents, at law, or in equity, regardless of any Enforcement Action Notice or Attachment No. 2 Enforcement Action by Subordinate Lender. No action or failure to act on the part of Senior Lender in the event of a Subordinate Loan Default or commencement of an Enforcement Action will constitute a waiver on the part of Senior Lender of any provision of the Senior Loan Documents or this Agreement. e. If the Enforcement Action taken by Subordinate Lender is the appointment of a receiver for any of the Property, all of the Rents, issues, profits and proceeds collected by the receiver will be paid and applied by the receiver solely to and for the benefit of Senior Lender until the Senior Loan will have been paid in full. f. Subordinate Lender consents to and authorizes the release by Senior Lender of all or any portion of the Property from the lien, operation, and effect of the Senior Loan Documents. Subordinate Lender waives to the fullest extent permitted by law, all equitable or other rights it may have (i) in connection with the release of all or any portion of the Property, (ii) to require the separate sale of any portion of the Property, (iii) to require Senior Lender to exhaust its remedies against all or any portion of the Property or any combination of portions of the Property or any other collateral for the Senior Loan, or (iv) to require Senior Lender to proceed against Borrower, any other party that may be liable for any of the Senior Loan (including any general partner of Borrower if Borrower is a partnership), all or any portion of the Property or combination of portions of the Property or any other collateral, before proceeding against all or such portions or combination of portions of the Property as Senior Lender determines. Subordinate Lender waives to the fullest extent permitted by law any and all benefits under California Civil Code Sections 2845, 2849 and 2850. Subordinate Lender consents to and authorizes, at the option of Senior Lender, the sale, either separately or together, of all or any portion of the Property. Subordinate Lender acknowledges that without Notice to such Subordinate Lender and without affecting any of the provisions of this Agreement, Senior Lender may (i) extend the time for or waive any payment or performance under the Senior Loan Documents; (ii) modify or amend in any respect any provision of the Senior Loan Documents subject to the limitations on such rights as set forth in Section 4(j); and (iii) modify, exchange, surrender, release, and otherwise deal with any additional collateral for the Senior Loan. g. If any party other than Borrower (including Senior Lender) acquires title to any of the Property pursuant to a foreclosure of, or trustee's sale or other exercise of any power of sale under, the Senior Lender conducted in accordance with applicable law, the lien, operation, and effect of the Subordinate Loan Documents automatically will terminate with respect to such Property. 6. Miscellaneous. a. If there is any conflict or inconsistency between the terms of the Subordinate Loan Documents and the terms of this Agreement, then the terms of this Agreement will control. b. This Agreement will be binding upon and will inure to the benefit of the respective legal successors and permitted assigns of the parties to this Agreement. No other party will be entitled to any benefits under this Agreement, whether as a third -party beneficiary or otherwise. Attachment No. 2 c. This Agreement does not constitute an approval by Senior Lender of the terms of the Subordinate Loan Documents. d. All notices or other written communications hereunder (each, a "Notice" and collectively, "Notices") shall be deemed to have been properly given (i) upon delivery, if delivered in person with receipt acknowledged by the recipient thereof, (ii) one (1) Business Day after having been deposited for overnight delivery with any reputable overnight courier service, or (iii) three (3) Business Days after having been deposited in any post office or mail depository regularly maintained by the U.S. Postal Service and sent by registered or certified mail, postage prepaid, return receipt requested, addressed to the respective parties as follows: Senior Lender: With a copy to: Bank: With a copy to: Subordinate Lender: California Municipal Finance Authority 2111 Palomar Airport Road, Suite 320 Carlsbad, CA 92011 Attention: [ ] Telephone: [ ] Jones Hall 475 Sansome Street, Suite 1700 San Francisco, CA 94111 Attention: Ronald E. Lee Telephone: (415) 391-5780 Pacific Western Bank 1001 Marsh Street San Luis Obispo, CA 93401 Phone: (805) 548-8210 Email: nroddick@pacificwesternbank.com Pacific Western Bank 444 South Flower Street, 14th Floor Los Angeles, CA 90071 Attention: Holly A. Hayes Phone (213) 330-2073 Email: hhayes@pacificwesternbank.com Community Development Commission - Housing Authority of the City of National City 140 East 12th Street National City, CA 91950-3312 Attention: Executive Director e. Nothing in this Agreement or in any of the Senior Loan Documents or Subordinate Loan Documents will be deemed to constitute Senior Lender as a joint venturer or partner of Subordinate Lender. Attachment No. 2 f. Upon Notice from Senior Lender, Subordinate Lender will execute and deliver such additional instruments and documents, and will take such actions, as are required by Senior Lender in order to further evidence or implement the provisions and intent of this Agreement. g. If any one or more of the provisions contained in this Agreement, or any application of any such provisions, is invalid, illegal, or unenforceable in any respect, the validity, legality, enforceability, and application of the remaining provisions contained in this Agreement will not in any way be affected or impaired. h. The term of this Agreement will commence on the date of this Agreement and will continue until the earliest to occur of the following events: (i) the payment of all of the Senior Loan; provided that this Agreement will be reinstated in the event any payment on account of the Senior Loan is avoided, set aside, rescinded or repaid by Senior Lender as described in Section 2(e) of this Agreement, (ii) the payment of all of the Subordinate Loan other than by reason of payments which Subordinate Lender is obligated to remit to Senior Lender pursuant to this Agreement, (iii) the acquisition by Senior Lender or by a third party purchaser of title to the Property pursuant to a foreclosure of, deed in lieu of foreclosure, or trustee's sale or other exercise of a power of sale or similar disposition under the Senior Deed of Trust; or (iv) with the prior written consent of Senior Lender, without limiting the provisions of Section 5(d), the acquisition by Subordinate Lender of title to the Property subject to the Senior Deed of Trust, pursuant to a foreclosure, or a deed in lieu of foreclosure, of (or the exercise of a power of sale under) the Subordinate Loan Documents. i. No failure or delay on the part of any party to this Agreement in exercising any right, power, or remedy under this Agreement will operate as a waiver of such right, power, or remedy, nor will any single or partial exercise of any such right, power or remedy preclude any other or further exercise of such right, power, or remedy or the exercise of any other right, power or remedy under this Agreement'. j. Each party to this Agreement acknowledges that if any party fails to comply with its obligations under this Agreement, the other parties will have all rights available at law and in equity, including the right to obtain specific performance of the obligations of such defaulting party and injunctive relief. k. Nothing in this Agreement is intended, nor will it be construed, to in any way limit the exercise by Subordinate Lender of its governmental powers (including police, regulatory and taxing powers) with respect to Borrower or the Property to the same extent as if it were not a party to this Agreement or the transactions contemplated by this Agreement. 1. This Agreement may be assigned at any time by Senior Lender to any subsequent holder of the Senior Loan Documents. m. This Agreement may be amended, changed, modified, altered or terminated only by a written instrument or written instruments signed by the parties to this Agreement. Attachment No. 2 n. This Agreement may be executed in two or more counterparts, each of which will be deemed an original but all of which together will constitute one and the same instrument. o. THIS AGREEMENT SHALL BE DEEMED TO BE A CONTRACT UNDER, AND TOGETHER WITH ANY DISPUTES OR CONTROVERSIES ARISING OUT OF OR RELATING TO THIS AGREEMENT, SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF CALIFORNIA AND APPLICABLE FEDERAL LAW, WITHOUT REGARD TO CHOICE OF LAW RULES. p. EACH PARTY HERETO CONSENTS TO AND SUBMITS TO IN PERSONAM JURISDICTION AND VENUE IN THE STATE AND IN THE FEDERAL DISTRICT COURTS WHICH ARE LOCATED IN THE STATE. EACH PARTY ASSERTS THAT IT HAS PURPOSEFULLY AVAILED ITSELF OF THE BENEFITS OF THE LAWS OF THE STATE AND WAIVES ANY OBJECTION TO IN PERSONAM JURISDICTION ON THE GROUNDS OF MINIMUM CONTACTS, WAIVES ANY OBJECTION TO VENUE, AND WAIVES ANY PLEA OF FORUM NON CONVENIENS. THIS CONSENT TO AND SUBMISSION TO JURISDICTION IS WITH REGARD TO ANY ACTION RELATED TO THIS AGREEMENT, REGARDLESS OF WHETHER THE PARTY'S ACTIONS TOOK PLACE IN THE STATE OR ELSEWHERE IN THE UNITED STATES OF AMERICA, THIS SUBMISSION TO JURISDICTION IS NONEXCLUSIVE, AND DOES NOT PRECLUDE EITHER PARTY FROM OBTAINING JURISDICTION OVER THE OTHER IN ANY COURT OTHERWISE HAVING JURISDICTION. q. EACH PARTY HERETO WAIVES ITS RIGHT TO A JURY TRIAL OF ANY AND ALL CLAIMS OR CAUSES OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT. IT IS HEREBY ACKNOWLEDGED THAT THE WAIVER OF A JURY TRIAL IS A MATERIAL INDUCEMENT FOR THE BANK TO MAKE THE BANK LOAN AND THAT THE EXECUTION AND DELIVERY OF THIS AGREEMENT BY THE IS MADE IN RELIANCE UPON SUCH WAIVER. EACH PARTY HERETO FURTHER WARRANTS AND REPRESENTS THAT SUCH WAIVER HAS BEEN KNOWINGLY AND VOLUNTARILY MADE FOLLOWING CONSULTATION WITH ITS RESPECTIVE LEGAL COUNSEL. r. Each party hereby covenants the following: The parties prefer that any dispute between them be resolved in litigation subject to a jury trial waiver as set forth in this Agreement, but the California Supreme Court has held that such pre -dispute jury trial waivers are unenforceable. This Section will be applicable until: (i) the California Supreme Court holds that a pre -dispute jury trial waiver provision similar to that contained in this Agreement herein is valid or enforceable; or (ii) the California Legislature passes legislation and the governor of the State of California signs into law a statute authorizing pre -dispute jury trial waivers and as a result such waivers become enforceable. Other than the exercise of provisional remedies (any of which may be initiated pursuant to applicable law), any controversy, dispute or claim (each, a "Claim") between the parties arising out of or relating to this Agreement will be resolved by a reference proceeding in Attachment No. 2 California in accordance with the provisions of Section 638 et seq. of the California Code of Civil Procedure ("CCP"), or their successor sections, which shall constitute the exclusive remedy for the resolution of any Claim, including whether the Claim is subject to the reference proceeding. Venue for the reference proceeding will be in the Superior Court or Federal District Court in Los Angeles County, California (the "Court"). The referee shall be a retired Judge or Justice selected by mutual written agreement of the parties. If the parties do not agree, the referee shall be selected by the Presiding Judge of the Court (or his or her representative). A request for appointment of a referee may be heard on an ex parte or expedited basis, and the parties agree that irreparable harm would result if ex parte relief is not granted. The referee shall be appointed to sit with all the powers provided by law. Pending appointment of the referee, the Court has power to issue temporary or provisional remedies. The parties agree that time is of the essence in conducting the reference proceedings. Accordingly, the referee shall be requested, subject to change in the time periods specified herein for good cause shown, to (a) set the matter for a status and trial -setting conference within fifteen (15) days after the date of selection of the referee, (b) if practicable, try all issues of law or fact within ninety (90) days after the date of the conference and (c) report a statement of decision within twenty (20) days after the matter has been submitted for decision. The referee will have power to expand or limit the amount and duration of discovery. The referee may set or extend discovery deadlines or cutoffs for good cause, including a party's failure to provide requested discovery for any reason whatsoever. Unless otherwise ordered based upon good cause shown, no party shall be entitled to "priority" in conducting discovery, depositions may be taken by either party upon seven (7) days written notice, and all other discovery shall be responded to within fifteen (15) days after service. All disputes relating to discovery which cannot be resolved by the parties shall be submitted to the referee whose decision shall be final and binding. Except as expressly set forth in this Agreement, the referee shall determine the manner in which the reference proceeding is conducted including the time and place of hearings, the order of presentation of evidence, and all other questions that arise with respect to the course of the reference proceeding. All proceedings and hearings conducted before the referee, except for trial, shall be conducted without a court reporter, except that when any party so requests, a court reporter will be used at any hearing conducted before the referee, and the referee will be provided a courtesy copy of the transcript. The party making such a request shall have the obligation to arrange for and pay the court reporter. Subject to the referee's power to award costs to the prevailing party, the parties will equally share the cost of the referee and the court reporter at trial. The referee shall be required to determine all issues in accordance with existing case law and the statutory laws of the State of California. The rules of evidence applicable to proceedings at law in the State of California will be applicable to the reference proceeding. The referee shall be empowered to enter equitable as well as legal relief, provide all temporary or provisional remedies, enter equitable orders that will be binding on the parties and rule on any motion which would be authorized in a trial, including without limitation motions for summary judgment or Attachment No. 2 summary adjudication. The referee shall issue a decision pursuant to CCP Section 644 the referee's decision shall be entered by the Court as a judgment or an order in the same manner as if the action had been tried by the Court. The final judgment or order or from any appealable decision or order entered by the referee shall be fully appealable as provided by law. The parties reserve the right to findings of fact, conclusions of laws, a written statement of decision, and the right to move for a new trial or a different judgment, which new trial, if granted, is also to be a reference proceeding under this provision. If the enabling legislation which provides for appointment of a referee is repealed (and no successor statute is enacted), any dispute between the parties that would otherwise be determined by reference procedure will be resolved and determined by arbitration. The arbitration will be conducted by a retired judge or Justice, in accordance with the California Arbitration Act Section 1280 through Section 1294.2 of the CCP as amended from time to time. The limitations with respect to discovery set forth above shall apply to any such arbitration proceeding. THE PARTIES RECOGNIZE AND AGREE THAT ALL DISPUTES RESOLVED UNDER THIS REFERENCE PROVISION WILL BE DECIDED BY A REFEREE AND NOT BY A JURY. AFTER CONSULTING (OR HAVING HAD THE OPPORTUNITY TO CONSULT) WITH COUNSEL OF THEIR OWN CHOICE, EACH PARTY KNOWINGLY AND VOLUNTARILY AND FOR THEIR MUTUAL BENEFIT AGREES THAT THIS REFERENCE PROVISION WILL APPLY TO ANY DISPUTE BETWEEN THEM WHICH ARISES OUT OF OR IS RELATED TO THIS AGREEMENT. SENIOR LENDER INITIALS: SUBORDINATE LENDER INITIALS: Nothing in this Section shall affect the rights of the parties to serve legal process in any other manner permitted by law or affect the right of the parties to bring any suit, action or proceeding in the courts of any other jurisdiction. [NO FURTHER TEXT ON THIS PAGE] Attachment No. 2 [SIGNATURE PAGE TO SUBORDINATION AGREEMENT] IN WITNESS WHEREOF, this Agreement has been executed effective as of the date first above written: SENIOR LENDER: CALIFORNIA MUNICIPAL FINANCE AUTHORITY By: Name: Its: Attachment No. 2 NOTARY ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF CALIFORNIA COUNTY OF On , before me, ss. Date Name and Title of Officer (e.g., "Jane Doe, Notary Public") personally appeared Name(s) of Signer(s) who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he / she / they executed the same in his / her / their authorized capacity(ies), and that by his / her / their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature [Seal] Notary Public Attachment No. 2 [SIGNATURE PAGE TO SUBORDINATION AGREEMENT] IN WITNESS WHEREOF, this Agreement has been executed effective as of the date first above written: SUBORDINATE LENDER: COMMUNITY DEVELOPMENT COMMISSION — HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY By: Executive Director Approved as to form and legality: By: Deputy City Attorney Attachment No. 2 NOTARY ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF CALIFORNIA COUNTY OF On , before me, ss. Date Name and Title of Officer (e.g., "Jane Doe, Notary Public") personally appeared Name(s) of Signer(s) who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he / she / they executed the same in his / her / their authorized capacity(ies), and that by his / her / their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature [Seal] Notary Public Attachment No. 2 EXHIBIT A LEGAL DESCRIPTION OF PROPERTY [To be inserted] RESOLUTION NO. 2017 — RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY APPROVING THE REFINANCING TERMS FOR VISTA DEL SOL APARTMENTS LOCATED AT 1545 "Q" AVENUE IN NATIONAL CITY THAT PRESERVES AFFORDABILITY FOR 130 APARTMENT UNITS THROUGH DECEMBER 31, 2073; APPROVING THE REINSTATEMENT OF TWO LOANS MADE BY THE HOUSING AUTHORITY AS ONE NEW LOAN IN THE TOTAL AMOUNT OF $7,407,795.08 TO BE ASSUMED BY VISTA DEL SOL APARTMENT, L.P.; AND AUTHORIZING THE EXECUTIVE DIRECTOR TO EXECUTE THE AMENDED AND RESTATED LOAN AND REGULATORY AGREEMENTS AND ANY OTHER DOCUMENTS NECESSARY TO CLOSE ESCROW WHEREAS, Vista Del Sol Apartments, L.P. ("Borrower") proposes to assume and modify the ownership structure of Vista Del Sol Apartments, a 132-unit affordable rental housing development at 1545 "Q" Avenue, in National City (the "Property"); and WHEREAS, the acquisition and proposed rehabilitation is intended to serve as a community resource by providing decent, safe, and sanitary housing for households who would otherwise be unable to afford such housing; and WHEREAS, the Community Development Commission of the City of National City ("Original Lender") previously provided the properties with financial assistance in the form of loans from public funds to support development of the properties to increase and improve the supply of housing available in the community to low and moderate -income households; and WHEREAS, the Original Lender and Copper Hills Apartments Limited Partnership, a California limited partnership ("Prior Owner"), entered into that certain Affordable Housing Agreement dated as of December 7, 1988 ("Affordable Housing Agreement") in which the Prior Owner received a secured loan from the Original Lender, from the Original Lender's Low and Moderate Income Housing Fund and from HOME funds in an original principal amount of $2,400,000, secured by deed of trust recorded on the property with the San Diego County Recorder on May 27, 1999, as Instrument No. 1999-0363599 ("Former RR Loan"), which is more particularly described in the Affordable Housing Agreement. The Former RR Loan funds have been fully disbursed. $771,658 in principal remains outstanding and $3,797 in interest has accrued as of December 12, 2017, under the Former RR Loan; and WHEREAS, the Prior Owner received a second secured loan from the Original Lender from the Original Lender's issuance of tax allocation bond proceeds in an original principal amount of $4,454,037.07, secured by deed of trust recorded on the property with the San Diego County Recorder on June 2, 1999, as Instrument No. 1999-0382563 ("Former Rehab Loan"), which is more particularly described in the Affordable Housing Agreement. The Former Rehab Loan funds have been fully disbursed. $4,454,037 in principal remains outstanding and $2,349,504 in interest has accrued as of December 12, 2017, under the Former Rehab Loan. The Former Rehab Loan together with the Former RR Loan, shall be referred to herein together, as the "Former Loan"; and WHEREAS, that certain Regulatory Agreement and Declaration of Restrictive Covenants dated as of December 7, 1998, and recorded in the Office of the County Recorder for the County of San Diego on December 11, 1998, as Instrument Number 1998-0807600 ("Previous Regulatory Agreement") was originally made by the Prior Owner and Original Lender; and Resolution No. 2017 — Page Two WHEREAS, the Community Development Commission -Housing Authority of the City of National City ("Lender") elected to retain the housing assets of and functions previously performed by the Original Lender pursuant to California Health and Safety Code Section 34176, and thereby, by operation of law, the Lender assumed the rights and obligations of the Original Lender with respect to the Affordable Housing Agreement; and WHEREAS, the Borrower is acquiring the Property from the Prior Owner, the Borrower is assuming all of the rights and liabilities of the Prior Owner with respect to the Affordable Housing Agreement and with respect to the Consolidated, Amended and Restated Promissory Note, as defined below. The Lender and Borrower desire to amend and restate the Affordable Housing Agreement in its entirety. Concurrently with the Amended and Restated Loan Agreement ("Restated Loan Agreement"), the promissory notes for the Former Loan are being consolidated, amended and restated into a single Amended and Restated Promissory Note which will be executed by Borrower in the original principal amount of $7,407,795.08 ("Loan"). Each deed of trust securing the Former Loan is being reconveyed, and a new Deed of Trust securing the Loan is being executed and recorded against the Property. These instruments are intended to secure Lender's continuing interest as a governmental entity in the affordability and habitability of the Property, as well as to secure performance of other covenants contained in such agreements; and WHEREAS, The Lender and Borrower also desire to amend and restate the Previous Regulatory Agreement in its entirety. The Amended and Restated Regulatory Agreement (Restated Regulatory Agreement) will be executed and recorded pursuant to the requirements of California Health and Safety Code Section 33334.3. The purpose of this Restated Regulatory Agreement is to regulate and restrict the occupancy, rents, operation, ownership, and management of the property for the benefit of project occupants and the people of the City of National City. The covenants in the Restated Regulatory Agreement are intended to run with the land and be binding on Borrower and Borrower's successors to the land for the full term of the Restated Regulatory Agreement. NOW, THEREFORE, BE IT RESOLVED, that the Community Development Commission -Housing Authority of the City of National City hereby approves the refinancing terms for Vista Del Sol Apartments located at 1545 "Q" Avenue in National City that preserves affordability for 130 apartment units through December 31, 2073; approving the reinstatement of two loans made by the Housing Authority as one new loan in the total amount of $7,407,795.08 to be assumed by Vista Del Sol Apartment, L.P.; and authorizing the Executive Director to execute the Amended and Restated Loan and Regulatory Agreements and any other documents necessary to close escrow. The Amended and Restated Regulatory Agreement will be publicly recorded at the County of San Diego Recorder's Office at the close of escrow and a copy of the Amended and Restated Loan Agreement will be available at the Office of the City Clerk. [Signature Page to Follow] Resolution No. 2017 — Page Three PASSED and ADOPTED this 19th day of December, 2017. Ron Morrison, Chairman ATTEST: Leslie Deese, Secretary APPROVED AS TO FORM: Angil P. Morris -Jones General Counsel CITY OF NATIONAL CITY Office of the City Clerk 1243 National City Blvd., National City, California 91950-4397 619-336-4228 Michael R. Dalla, CMC - City Clerk VISTA DEL SOL APARTMENTS AND COPPER HILLS APARTMENTS LIMITED PARTNERSHIP Re -syndication of Vista Del Sol Apartments 1545 "Q" Avenue Angelita Palma (Housing & Economic Development) Forwarded Fully Executed Original Agreement to Vista Del Sol Apartments and Copper Hills Apartments Limited Partnership. CALIFORNIA —6- NA 99 f .L CITV laVY INCORPORATED The City of National City MEMORANDUM DATE: July 5, 2018 TO: City Clerk's Office FROM: Angelita PaImaommunity Development Specialist II Housing & Economic Development Department SUBJECT: HOME Program FTHB Program Recorded Loan Documents Please keep the attached recorded documents on file: Project: Vista del Sol Resyndication 2017 (also known as Copper Hills) 1. Substitution of Trustee and Full Reconveyance of Deeds of Trust — Recorded 2. Subordination Agreement — Recorded 3. Assignment, Assumption, and Consent Agreement — Recorded 4. Amended Restated Regulatory Agreement — Recorded 5. Deed of Trust Assignment of Rents and Security Agreement — Recorded 1243 National City Blvd; National City, California 91950 Recording Requested by: FNTG Builder Services NO FEE DOCUMENT Government Code Section 27383 When recorded mail to: Community Development CDC of the City of National City 140 E. 12`h Street, Suite B National City, CA 91950-3312 Attention: Executive Director . DOC# 2017-0608392 IIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIII IIIIIIIIIIIIIIIIIIIIIII Dec 27, 2017 10:37 AM OFFICIAL RECORDS Ernest J. Dronenburg, Jr., SAN DIEGO COUNTY RECORDER FEES: $37.00 PCOR: N/A PAGES: 2 SUBSTITUTION OF TRUSTEE AND FULL RECONVEYANCE OF DEEDS OF TRUST Copper Hills Apartments Limited Partnership, a California limited partnership, is the trustor, Fidelity National Title Insurance Company is the original trustee, and the Community Development Commission of the Community Development Commission -Housing Authority of the City of National City ("CDC -HA") is the current beneficiary under (collectively, the Deeds of Trust"): (i) that certain Deed of Trust, dated as of February 18, 1999, which was recorded in the Official Records of San Diego County, California, on May 27, 1999, as File No. 1999- 0363599; and (ii) that certain Deed of Trust, dated as of June 1, 1999, which was recorded in the Official Records of San Diego County, California, on June 2, 1999, as File No. 1999-0382563. 1. Substitution of Trustee. The undersigned, as the sole present Beneficiary under each of the Deeds of Trust, hereby substitutes the CDC -HA, whose address is 140 East 12th Street, National City, California 91950, as Trustee in the place of said original trustee in each of the Deeds of Trust. 2. Full Reconveyance of Deeds of Trust. The CDC -HA, as Trustee, in each of the Deeds of Trust hereby reconveys to the person(s) legally entitled thereto, without warranty, all of the estate, title and interest acquired by Trustee under said Deeds of Trust in and to that real property described in the Deeds of Trust. CDC: Community Development Commission -Housing Authority of the City of National City Executive Director („e,SL/( Gi�Ef� Approved as to Form: By f De Deputy City Attorney Recording Requested by: FNTG Builder Services NO FEE DOCUMENT Government Code Section 27383 When recorded mail to: Community Development CDC of the City of National City 140 E. 12th Street, Suite B National City, CA 91950-3312 Attention: Executive Director SUBSTITUTION OF TRUSTEE AND FULL RECONVEYANCE OF DEEDS OF TRUST Copper Hills Apartments Limited Partnership, a California limited partnership, is the trustor, Fidelity National Title Insurance Company is the original trustee, and the Community Development Commission of the Community Development Commission -Housing Authority of the City of National City ("CDC -HA") is the current beneficiary under (collectively, the Deeds of Trust"): (i) that certain Deed of Trust, dated as of February 18, 1999, which was recorded in the Official Records of San Diego County, California, on May 27, 1999, as File No. 1999- 0363599; and (ii) that certain Deed of Trust, dated as of June 1, 1999, which was recorded in the Official Records of San Diego County, California, on June 2, 1999, as File No. 1999-0382563. 1. Substitution of Trustee. The undersigned, as the sole present Beneficiary under each of the Deeds of Trust, hereby substitutes the CDC -HA, whose address is 140 East 12th Street, National City, California 91950, as Trustee in the place of said original trustee in each of the Deeds of Trust. 2. Full Reconveyance of Deeds of Trust. The CDC -HA, as Trustee, in each of the Deeds of Trust hereby reconveys to the person(s) legally entitled thereto, without warranty, all of the estate, title and interest acquired by Trustee under said Deeds of Trust in and to that real property described in the Deeds of Trust. CDC: Community Development Commission -Housing Authority of the City of National City Executive Director Left/E L2If6 Approved as to Form: By: Deputy City Attorney ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of San Diego On Dec.wcf fl , 2017, before me, Ai► I,�,�, a L.,%, , notary public, personally appeared l; c u who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature ANGELITA PALMA Commission No. 2215876 NOTARY PUBLIC - CALIFORNIA 11 SAN DIEGO COUNTY 1 Commission Expires October 25, 2021 (Seal) Recording Requested by: FNTG Builder Services NO FEE DOCUMENT Government Code Section 27383 Recording requested by: DOC# 2017-0605976 111111I III11111I I I I111111111111101111111111111I11111111111 Dec 26, 2017 08:00 AM OFFICIAL RECORDS Ernest J. Dronenburg, Jr., SAN DIEGO COUNTY RECORDER FEES: $0.00 PAGES: 19 When recorded mail to: Community Development Commission of the City of National City 140 E. 12th Street, Suite B National City, CA 91950-3312 Attention: Executive Director SUBORDINATION AGREEMENT (Vista Del Sol -Seller Carryback) THIS SUBORDINATION AGREEMENT ("Subordination Agreement") dated as of the 18th day of December, 2017, by Vista Del Sol Apartments, L.P., a California limited partnership ("Borrower"), the Community Development Commission -Housing Authority of the City ofNational City ("CDC -HA"), and Copper Hills Apartments Limited Partnership, a California limited partnership ("Subordinate Lender"). RECITALS A. Borrower is the owner of certain real property in the City of National City, County of San Diego, California ("Property"), described on Exhibit A attached hereto. B. Concurrently with recordation of this Subordination Agreement, the Borrower is assuming a loan previously made by the CDC -HA to the Borrower's successor in interest to the Property evidenced by that certain Consolidated, Amended and Restated Promissory Note of even date herewith ("CDC -HA Note"), in the original principal amount of Seven Million Four Hundred Seven Thousand Seven Hundred Ninety -Five and 08/100 Dollars ($7,407,795.08) ("CDC -HA Loan"). The CDC -HA Loan and the CDC -HA Note are secured by: (i) that certain Amended and Restated Regulatory Agreement of even date herewith ("Regulatory Agreement") executed by the Borrower in favor of the CDC -HA; and (ii) that certain Deed of Trust, Assignment of Rents and Security Agreement of even date herewith ("CDC -HA Deed of Trust") executed by the Borrower in favor of the CDC -HA. The Regulatory Agreement and the CDC -HA Deed of Trust are being recorded against the Property in the Office of the Recorder of the County of San Diego, State of California concurrently with recordation of this Subordination Agreement. C. Concurrently with recordation of this Subordination Agreement, the Borrower is executing, in favor of the Subordinate Lender, that certain Residual Receipts Purchase Money Promissory Note in the original principal amount of Two Million Five Hundred Thousand and 1 He Recording Requested by: FNTG Builder Services NO FEE DOCUMENT Government Code Section 27383 Recording requested by: When recorded mail to: Community Development Commission of the City of National City 140 E. 12th Street, Suite B National City, CA 91950-3312 Attention: Executive Director 23v9-7' a SUBORDINATION AGREEMENT (Vista Del Sol -Seller Carryback) THIS SUBORDINATION AGREEMENT ("Subordination Agreement") dated as of the 18th day of December, 2017, by Vista Del Sol Apartments, L.P., a California limited partnership ("Borrower"), the Community Development Commission -Housing Authority of the City ofNational City ("CDC -HA"), and Copper Hills Apartments Limited Partnership, a California limited partnership ("Subordinate Lender"). RECITALS A. Borrower is the owner of certain real property in the City ofNational City, County of San Diego, California ("Property"), described on Exhibit A attached hereto. B. Concurrently with recordation of this Subordination Agreement, the Borrower is assuming a loan previously made by the CDC -HA to the Borrower's successor in interest to the Property evidenced by that certain Consolidated, Amended and Restated Promissory Note of even date herewith ("CDC -HA Note"), in the original principal amount of Seven Million Four Hundred Seven Thousand Seven Hundred Ninety -Five and 08/100 Dollars ($7,407,795.08) ("CDC -HA Loan"). The CDC -HA Loan and the CDC -HA Note are secured by: (i) that certain Amended and Restated Regulatory Agreement of even date herewith ("Regulatory Agreement") executed by the Borrower in favor of the CDC -HA; and (ii) that certain Deed of Trust, Assignment of Rents and Security Agreement of even date herewith ("CDC -HA Deed of Trust") executed by the Borrower in favor of the CDC -HA. The Regulatory Agreement and the CDC -HA Deed of Trust are being recorded against the Property in the Office of the Recorder of the County of San Diego, State of California concurrently with recordation of this Subordination Agreement. C. Concurrently with recordation of this Subordination Agreement, the Borrower is executing, in favor of the Subordinate Lender, that certain Residual Receipts Purchase Money Promissory Note in the original principal amount of Two Million Five Hundred Thousand and No/100 Dollars ($2,500,000.00) ("Subordinate Note") of even date herewith. The Subordinate Note will be secured by that certain Deed of Trust With Assignment of Rents ("Subordinate Deed of Trust") which is being made by the Borrower in favor of the Subordinate Lender and which is being recorded in the Office of the Recorder of the County of San Diego, State of California concurrently herewith. The Subordinate Note and all obligations of any type or nature secured by the Subordinate Deed of Trust, presently or hereafter due from Borrower to the Subordinate Lender, together with all interest and other charges or expenses incidental thereto, shall be referred to herein as the "Subordinate Indebtedness." D. The CDC -HA, Subordinate Lender and Borrower all agree and desire to execute this Subordination Agreement to memorialize their understanding and agreement with regard to the respective priorities of each of the above -referenced documents. It is the intention of the parties that the CDC -HA Loan, the Regulatory Agreement and the CDC -HA Deed of Trust shall unconditionally be and remain at all times liens, claims and charges on the Property prior and superior to the Subordinate Loan and the Subordinate Deed of Trust. NOW, THEREFORE, in consideration of the foregoing and other good and valuable consideration, the CDC -HA, Subordinate Lender and Borrower hereby agree as follows: AGREEMENT 1. Subordination of the Subordinate Documents. The Subordinate Loan and the Subordinate Deed of Trust, together with all rights and privileges of Subordinate Lender and the Borrower thereunder, are hereby irrevocably and unconditionally made subordinate to and subject to the CDC - HA Loan, the Regulatory Agreement and the CDC -HA Deed of Trust, which shall remain at all times liens, claims and charges on the Property prior and superior to the Subordinate Loan and the Subordinate Deed of Trust and to all rights and privileges of Subordinate Lender and the Borrower thereunder. 2. Whole Agreement; Binding Effect. This Subordination Agreement is the whole and only agreement with regard to the priority of the liens, claims and charges of the CDC -HA Loan, the Regulatory Agreement and the CDC -HA Deed of Trust and the Subordinate Loan and the Subordinate Deed of Trust. This Subordination Agreement is binding on and inures to the benefit of the legal representatives, heirs, successors and assigns of the parties. 3. Attorney's Fees. If any party to this Subordination Agreement brings an action to interpret or enforce its rights under this Subordination Agreement, the prevailing party will be entitled to recover its costs and reasonable attorney's fees as awarded in the action. 4. Governing Law. This Subordination Agreement is governed by, and shall be construed in accordance with, the laws of the State of California. 5. Counterparts. This Subordination Agreement may be executed in counterparts, and all counterparts constitute but one and the same document. 2 6. Signatures. All individuals signing this Subordination Agreement for a party which is a corporation, limited liability company, partnership or other legal entity, or signing under a power of attorney, or as a trustee, guardian, conservator, or in any other legal capacity, covenant to the CDC - HA that they have the necessary capacity and authority to act for, sign and bind the respective entity or principal on whose behalf they are signing. IN WITNESS WHEREOF, the parties have executed this Subordination Agreement as of the date first set forth above and agree to be bound hereby. SUBORDINATE LENDER: Copper Hills Apartments Limited Partnership, a California limited partnership By: Print Name: Its: rI icA4A£L F I.J,/ [SIGNATURES CONTINUED ON FOLLOWING PAGE] 3 California All -Purpose Acknowledgment A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of San Bernardino On December 19, 2017 before me, Monica Rodriguez, Notary Public personally appeared Michael Finn who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand an official seal. OPTIONAL INFORMATION Description of Attached Document The preceding Certificate of Acknowledgment is attached to a document titled/for the purpose of containing pages, and dated The signer(s) capacity or authority is/are as: ❑ Individual(s) ❑ Attorney -in -fact ❑ Corporate Of iicer(s) ❑ Guardian/Conservator ❑ Partner - Limited/General ❑ Trustee(s) ❑ Other: representing: z z MONICA RODRIGUEZ Notary Public - California San Bernardino County Commission # 2194994 My Comm. Expires May 26, 2021 z z Additional lnfocmation Method of Signer Identification Proved to me on the basis of satisfactory evidence: ❑ form(s) of identification ❑ credible witness(es) Notarial event is detailed in notary journal on: Page # Entry # Notary contact: Other ❑ Additional Signer ❑ Signer(s) Thumbprints(s) BORROWER: Vista Del Sol Apartments, L.P., a California limited partnership By: Vista Del Sol GP LLC, a California limited liability company, its general partner By: National Community Renaissance of California, a California nonprofit public benefit corporation, its managing member By: Its: Qr= © too- 6,44) [SIGNATURES CONTINUED ON FOLLOWING PAGE] California All -Purpose Acknowledgment A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness. accuracy, or validity of that document. State of California County of San Bernardino S.S. On December 19, 2017 before me, Monica Rodriguez, Notary Public personally appeared Michael Finn who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand an official seal. OPTIONAL INFORMATION z z MONICA RODRIGUEZ Notary Public - California San Bernardino County Commission # 2194994 My Comm. Expires May 26, 2021 z z .don in th acknowledgment to an unauthorized document and may prove useful to persons Description of Attached Document The preceding Certificate of Acknowledgment is attached to a document titled/for the purpose of containing pages, and dated The signer(s) capacity or authority is/are as: J Individual(s) ❑ Attorney -in -fact ❑ Corporate Officer(s) ❑ Guardian/Conservator ❑ Partner - Limited/General ❑ Trustee(s) ❑ Other: representing: iudulent ttachme relying on the attached document, Method of Signer Identification Proved to me on the basis of satisfactory evidence: ❑ form(s) of identification ❑ credible witness(es) Notarial event is detailed in notary journal on: Page # Entry # Notary contact: Other ❑ Additional Signer Signer(s) Thumbprints(s) California All -Purpose Acknowledgment A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of San Bernardino S.S. On December 19, 2017 before me, Monica Rodriguez, Notary Public personally appeared Michael Finn who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature of Notary Pubi OPTIONAL INFORMATION z MONICA RODRIGUEZ Notary Public - California San Bernardino County Commission # 2194994 MComm. Expires May 26, 2021 z z ,,ection is ._ acknowledgment to an unauthorized document and may prove useful to persons Description of Attached Document The preceding Certificate of Acknowledgment is attached to a document titled/for the purpose of containing pages, and dated The signer(s) capacity or authority is/are as: u Individual(s) ❑ Attorney -in -fact ❑ Corporate Officer(s) Titlei: Guardian/Conservator Partner - Limited/General Trustee(s) Other: representing: relying on the attached document. Method of Signer Identification Proved to me on the basis of satisfactory evidence: form(s) of identification ❑ credible witness(es) Notarial event is detailed in notary journal on: Page # Entry # Notary contact: Other ❑ Additional Signer [_1 Signer(s) Thumbprints(s) CDC -HA: THE COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY, By: ul Its: Executive Director i, sciF GEESE Approved as to form: By: 'i‘ eputy City Attorney ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of San Diego On e rvAxe,r 11 , 2017, before me, ptirleA �i-a al .r.� , notary public, personally appeared Le -slit De- s-c— who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. ANGELITA PALMA Commission No. 2215878 NOTARY PUBLIC - CALIFORNIA SAN DIEGO COUNTY Commission Expires October 25_2021 (Seal) 6 Notary Seal Certification (Government Code 27361.7) I certify under penalty of perjury that this material is a true copy of the original material contained in this document. Name of Notary: y /not /KA d Commission Number: 2z / Sz 7 2 Date Commission Expires: /o/ r 1/ County Where Bond is Filed: "' e �� n Manufacturer or Vendor Number: ` G 0 (Located on both sides of the notary seal border) Signature: San Diego Place of Execution Calvin Williamson, Synrgo Agent (‘7/7Date: /� � ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of San Diego On , 2017, before me, , notary public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature (Seal) 7 ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of San Diego ) ) ) On , 2017, before me, , notary public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature (Seal) 8 Exhibit "A" Property Description That certain real property situated in the City of National City, County of San Diego, State of California, described as follows: 9 EXHIBIT "A" Legal Description of Real Property THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS: PARCEL 1: THE NORTHERLY 52.40 FEET OF THE SOUTHERLY 217.40 FEET OF THE WESTERLY HALF OF THE SOUTHERLY HALF OF THE WESTERLY HALF OF THE SOUTHWEST QUARTER OF QUARTER SECTION 129 OF RANCHO DE LA NACION, ACCORDING TO MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, MAY 11, 1869. EXCEPTING THEREFROM THE WESTERLY 185.00 FEET AND ALSO EXCEPTING THEREFROM THE EASTERLY 30.00 FEET. APN(s): 557-440-50 PARCEL 2: THE NORTHERLY 52.45 FEET OF THE SOUTHERLY 269.85 FEET OF THE WESTERLY ONE-HALF OF THE SOUTHERLY ONE-HALF OF THE WESTERLY ONE-HALF OF THE SOUTHWESTERLY QUARTER OF SECTION 129 OF RANCHO DE LA NACION, ACCORDING TO MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY. EXCEPTING THEREFROM THE WESTERLY 185.00 FEET; ALSO EXCEPTING THEREFROM THE EASTERLY 30.00 FEET. APN(s): 557-440-49 PARCEL 3: ALL OF THE WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWEST QUARTER OF QUARTER SECTION 129, RANCHO DE LA NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. EXCEPTING THEREFROM THE NORTH 273.00 FEET THEREOF. ALSO EXCEPTING THEREFROM THE SOUTH 323.85 FEET THEREOF. ALSO EXCEPTING THEREFROM THE WESTERLY 144.00 FEET THEREOF. ALSO EXCEPTING THEREFROM THE EASTERLY 30.00 FEET THEREOF. APN(s): 557-440-40 PARCEL 4: THE SOUTH 60.00 FEET OF THE NORTH 273.00 FEET OF THE WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWEST QUARTER OF QUARTER SECTION 129, RANCHO DE LA NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. EXCEPTING THEREFROM THE WEST 155.00 FEET. ALSO EXCEPTING THEREFROM THE EAST 30.00 FEET THEREOF. APN(s): 557-440-07 PARCEL 5: THE SOUTHERLY 65.00 FEET OF THE NORTHERLY 213.00 FEET OF THE WEST HALF OF THE SOUTH HALF OFTHE WEST HALF OF THE SOUTHWEST QUARTER OF QUARTER SECTION 129, RANCHO DE LA NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. EXCEPTING THEREFROM THE WEST 155.00 FEET. ALSO EXCEPTING THEREFROM THE EAST 30.00 FEET THEREOF. APN(s): 557-440-52 PARCEL 6: THE EASTERLY 150.00 FEET OF THE SOUTHERLY 58.00 FEET OF THE NORTHERLY 148.00 FEET OF THE WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWESTERLY QUARTER OF QUARTER SECTION 129, RANCHO DE LA NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, MAY 11, 1869. EXCEPTING THEREFROM THE EASTERLY 30.00 FEET. ALSO EXCEPTING THEREFROM THAT PORTION LYING WITHIN THE FOLLOWING DESCRIBED BOUNDARY: COMMENCING AT THE INTERSECTION OF THE NORTHERLY LINE OF THE WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWESTERLY QUARTER OF QUARTER SECTION 129 WITH THE WESTERLY LINE OF THE EASTERLY 30.00 FEET OF SAID WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWESTERLY QUARTER OF QUARTER SECTION 129; THENCE, ALONG SAID WESTERLY LINE SOUTH 18 44' 00" EAST, 9.80 FEET TO A POINT IN THE ARC OF A 50.00 FOOT RADIUS CURVE, THE CENTER OF WHICH BEARS SOUTH 55° 36' 12" EAST FROM SAID POINT AND BEING THE TRUE POINT OF BEGINNING; THENCE SOUTHWESTERLY, SOUTHERLY AND SOUTHEASTERLY ALONG THE ARC OF SAID CURVE THROUGH A CENTRAL ANGLE OF 97 32' 43" A DISTANCE OF 85.12 FEET TO THE BEGINNING OF A REVERSE 20.00 FOOT RADIUS CURVE; THENCE SOUTHEASTERLY ALONG THE ARC OF SAID CURVE THROUGH A CENTRAL ANGLE OF 44° 24' 55" A DISTANCE OF 15.50 FEET TO THE POINT OF TANGENCY IN THE WESTERLY LINE OF SAID EASTERLY 30.00 FEET; THENCE, ALONG SAID WESTERLY LINE NORTH 18 44' 00" WEST TO THE TRUE POINT OF BEGINNING. ALSO EXCEPTING THEREFROM THAT PORTION LYING WITHIN THE FOLLOWING DESCRIBED PROPERTY: BEGINNING AT THE NORTHWEST CORNER OF THE WEST HALF OF THE EAST HALF OF THE SOUTHWEST QUARTER OF THE WEST HALF OF LOT 2 OF SAID QUARTER SECTION 129 AS SHOWN ON THE MAP OF MILES MANOR NO. 1, ACCORDING TO THE MAP THEREOF NO. 5869 FILED IN THE OFFICE OF THE RECORDER OF SAID SAN DIEGO COUNTY, APRIL 21, 1967; THENCE, SOUTH 18° 44' 00" EAST ALONG THE EASTERLY LINE OF THE WEST HALF OF THE SOUTHWEST QUARTER OF THE WEST HALF OF SAID LOT 2, BEING ALSO THE CENTER LINE OF "Q" AVENUE AS SHOWN ON SAID MAP NO. 5869, A DISTANCE OF 108.99 FEET; THENCE, LEAVING SAID CENTER LINE AT RIGHT ANGLES SOUTH 71° 16' 00" WEST 30.00 FEET TO THE POINT OF TANGENCY OF A 20.00 FOOT RADIUS CURVE CONCAVE SOUTHWESTERLY, THE CENTER OF WHICH BEARS SOUTH 71° 16' 00" WEST, 20.00 FEET; THENCE, NORTHERLY ALONG THE ARC OF SAID 20.00 FOOT RADIUS CURVE THROUGH A CENTRAL ANGLE OF 44° 24' 55" A DISTANCE OF 15.50 FEET TO THE POINT OF TANGENCY WITH A REVERSE 50.00 FOOT RADIUS CURVE CONCAVE EASTERLY; THENCE, NORTHERLY ALONG THE ARC OF SAID 50.00 FOOT RADIUS CURVE THROUGH A CENTRAL ANGLE OF 97° 32' 43" A DISTANCE OF 85.12 FEET TO THE INTERSECTION WITH A LINE PARALLEL WITH AND 30.00 FEET WESTERLY AT RIGHT ANGLES TO SAID EASTERLY LINE OF THE WEST HALF OF THE SOUTHWEST QUARTER OF THE WEST HALF OF SAID LOT 2; THENCE, LEAVING SAID CURVE ALONG SAID PARALLEL LINE NORTH 18° 44' 00" WEST 19.87 FEET TO THE NORTHERLY LINE OF SAID SOUTHWEST QUARTER OF LOT 2; THENCE, NORTH 71° 02' 00" EAST ALONG SAID NORTHERLY LINE 30.00 FEET TO THE POINT OF BEGINNING. APN(s): 557-440-45 PARCEL 7: PARCEL B OF CERTIFICATE OF COMPLIANCE CASE FILE NO. 2008-39 CC, AS DISCLOSED IN THE GRANT DEED RECORDED SEPTEMBER 18, 2009 AS INSTRUMENT NO. 2009-0521138 OF OFFICIAL RECORDS, MORE PARTICULARLY DESCRIBED AS FOLLOWS: THE EASTERLY 90.00 FEET OF THE FOLLOWING DESCRIBED PARCEL OF LAND: THE NORTHERLY 30.00 FEET OF THE WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWEST ONE -QUARTER OF QUARTER SECTION 129, RANCHO DE LA NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY. EXCEPTING THEREFROM THE WESTERLY 30 FEET THEREOF AS DEEDED TO THE CITY OF NATIONAL CITY BY DEEDS RECORDED FEBRUARY 19, 1903 IN BOOK 325, PAGE 208 OF DEEDS AND JANUARY 5, 1928 IN BOOK 1388, PAGE 392 OF DEEDS. ALSO EXCEPTING THE EASTERLY 30.00 FEET THEREOF. AND ALSO EXCEPTING THAT PORTION LYING WITHIN THE FOLLOWING DESCRIBED BOUNDARY: COMMENCING AT THE INTERSECTION OF THE NORTHERLY LINE OF THE WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTH WESTERLY QUARTER OF QUARTER SECTION 129 WITH THE WESTERLY LINE OF THE EASTERLY 30.00 FEET OF SAID WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWESTERLY QUARTER OF QUARTER SECTION 129; THENCE ALONG SAID WESTERLY LINE SOUTH 18°44'00" EAST 9.80 FEET TO A POINT ON THE ARC OF A 50.00 FOOT RADIUS CURVE, THE CENTER OF WHICH BEARS SOUTH 55°36'12" EAST FROM SAID POINT AND BEING THE TRUE POINT OF BEGINNING; THENCE SOUTHWESTERLY, SOUTHERLY AND SOUTHEASTERLY ALONG THE ARC OF SAID CURVE, THROUGH A CENTRAL ANGLE OF 97°32'43" A DISTANCE OF 85.12 FEET TO THE BEGINNING OF A REVERSE 20.00 FOOT RADIUS CURVE; THENCE SOUTHEASTERLY ALONG THE ARC OF SAID CURVE, THROUGH A CENTRAL ANGLE OF 44°24'55" A DISTANCE OF 15.50 FEET TO THE POINT OF TANGENCY 1N THE WESTERLY LINE NORTH 18°44'00"WEST TO THE TRUE POINT OF BEGINNING. TOGETHER WITH THE SOUTHERLY 60.00 FEET OF THE NORTHERLY 90.00 FEET OF THE WESTERLY HALF OF THE SOUTHERLY HALF OF THE WESTERLY HALF OF THE SOUTHWEST QUARTER OF QUARTER SECTION 129, OF RANCHO DE LA NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY; EXCEPTING THE WESTERLY 150.00 FEET THEREOF. ALSO EXCEPTING THE EASTERLY 30.00 FEET THEREOF. AND ALSO EXCEPTING THAT PORTION LYING WITHIN THE FOLLOWING DESCRIBED BOUNDARY: COMMENCING AT THE INTERSECTION OF THE NORTHERLY LINE OF THE WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWESTERLY QUARTER OF QUARTER SECTION 129 WITH THE WESTERLY LINE OF THE EASTERLY 30.00 FEET OF SAID WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWESTERLY QUARTER OF QUARTER SECTION 129; THENCE, ALONG THE SAID WESTERLY LINE SOUTH 18° 44' 00" EAST 9.80 FEET TO A POINT ON THE ARC OF A 50.00 FOOT RADIUS CURVE, THE CENTER OF WHICH BEARS SOUTH 55° 36' 12" EAST FROM SAID POINT AND BEING THE TRUE POINT OF BEGINNING; THENCE, SOUTHWESTERLY, SOUTHERLY, AND SOUTHEASTERLY ALONG THE ARC OF SAID CURVE THROUGH A CENTRAL ANGLE OF 97° 32' 43" A DISTANCE OF 85.12 FEET TO THE BEGINNING OF A REVERSE 20.00 FOOT RADIUS CURVE; THENCE, SOUTHEASTERLY ALONG THE ARC OF SAID CURVE THROUGH A CENTRAL ANGLE OF 44° 24' 55" A DISTANCE OF 15.50 FEET TO THE POINT OF TANGENCY IN THE WESTERLY LINE OF SAID EASTERLY 30.00 FEET; THENCE, ALONG SAID WESTERLY LINE NORTH 18° 44' 00" WEST TO THE TRUE POINT OF BEGINNING. APN(s): 557-440-46; 557-440-61 PARCEL 8: LOTS 6 AND 7 OF MILES MANOR UNIT NO. 1, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 5869, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, APRIL 21, 1967. AN UNDIVIDED 1/2 INTEREST IN LOT 8 AND AN UNDIVIDED 1/2 INTEREST IN THE NORTH HALF OF LOT 3 OF SAID MILES MANOR UNIT NO. 1, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 5869, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, APRIL 21, 1967. APN(s): 557-440-33 AND 557-440-34 PARCEL 9: LOTS 4 AND 5 AND AN UNDIVIDED ONE -QUARTER INTEREST IN AND TO THE NORTH HALF OF LOT 3 AND AN UNDIVIDED ONE -QUARTER INTEREST IN AND TO LOT 8, ALL IN MILES MANOR UNIT NO. 1 IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 5869, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY ON APRIL 21, 1967. APN(s): 557-440-31, 557-440-32, AND 557-440-43 PARCEL 10: LOTS 1 AND 2 AND THE SOUTHEASTERLY HALF OF LOT 3 OF MILES MANOR UNIT NO. 1, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 5869, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, APRIL 21, 1967. APN(s): 557-440-44 PARCEL 11: PARCEL NO. 2 OF PARCEL MAP NO. 890, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, JULY 10, 1972, FILE NO. 177287, OF OFFICIAL RECORDS. APN(s): 557-440-53 PARCEL 12: PARCEL 1 OF PARCEL MAP 890, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY ON JULY 10, 1972, BEING A PORTION OF THE SOUTHWEST QUARTER OF QUARTER SECTION 129 OF RANCHO DE LA NACION IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 166 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. APN(s): 557-440-54 PARCEL 13: LOT 8 OF MILES MANOR UNIT NO. 1, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 5869, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, APRIL 21, 1967. APN(s): 557-440-35 PARCEL 15: THAT PORTION OF THE EASTERLY HALF OF THE EASTERLY HALF OF THE SOUTHWESTERLY QUARTER OF THE WESTERLY HALF OF LOT 2 IN QUARTER SECTION 129 OF RANCHO DE LA NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY ON MAY 11, 1869, DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHEASTERLY CORNER OF THE SOUTHWESTERLY QUARTER OF THE WESTERLY HALF OF SAID LOT 2; THENCE SOUTHERLY ALONG THE EASTERLY LINE OF SAID SOUTHWESTERLY QUARTER OF THE WESTERLY HALF OF LOT 2, A DISTANCE OF 233.00 FEET; THENCE WESTERLY ALONG A LINE PARALLEL WITH THE NORTHERLY LINE OF SAID SOUTHWEST QUARTER, A DISTANCE OF 165.00 FEET ORE OR LESS TO THE WESTERLY LINE OF THE EASTERLY HALF OF THE EASTERLY HALF OF THE SOUTHWESTERLY QUARTER OF THE WESTERLY HALF OF SAID LOT 2 IN QUARTER SECTION 129; THENCE NORTHERLY ALONG SAID WESTERLY LINE OF THE SOUTHWESTERLY QUARTER OF LOT 2; THENCE EASTERLY ALONG SAID NORTHERLY LINE, A DISTANCE OF 165.00 FEET MORE OR LESS TO THE POINT OF BEGINNING. APN(s): 557-440-56 Acor-1,49 Requested by: FNTO Builder Services NO FEE DOCUMENT Government Code Section 27383 Recording requested by: When recorded mail to: Community Development Commission of the City of National City 140 E. 12th Street, Suite B National City, CA 91950-3312 Attention: Executive Director DOC# 2017-0605965 1111111111111111111111111111111111111111111111111111111111111 Dec 26, 2017 08:00 AM OFFICIAL RECORDS Ernest J. Dronenburg, Jr., SAN DIEGO COUNTY RECORDER FEES: $60.00 PCOR: N/A PAGES: 11 ASSIGNMENT, ASSUMPTION AND CONSENT AGREEMENT (Vista Del Sol -CDC -HA Recorded Documents) THIS ASSIGNMENT, ASSUMPTION AND CONSENT AGREEMENT ("Agreement") is dated as of the 18th day of December, 2017, Copper Hills Apartments Limited Partnership, a California limited partnership ("Assignor"), Vista Del Sol Apartments, L.P., a California limited partnership ("Assignee"), and the Community Development Commission -Housing Authority of the City of National City ("CDC -HA"). RECITALS A. Assignor and the CDC -HA are all of the current parties to: (i) that certain Regulatory Agreement and Declaration of Restrictive Covenants dated as of December 7, 1998, and recorded in the Office of the County Recorder for the County of San Diego on December 11, 1998 as Instrument Number 1998-0807600 ("Regulatory Agreement"); and (ii) that certain Operation and Maintenance Agreement dated as of December 7, 1998, and recorded in the Office of the County Recorder for the County of San Diego on December 11, 1998 as Instrument Number 1998-0807604 ("Operation Agreement"). B. Assignor desires to convey the real property ("Property") described in the Regulatory Agreement and the Operation Agreement to Assignee, and Assignor desires to assign its interests in the Regulatory Agreement and the Operation Agreement to Assignee, and Assignee desires to assume all of the interest, rights and responsibilities of Assignor under the Regulatory Agreement and the Operation Agreement from and after the date hereof. C. The consent of the CDC -HA is a condition precedent to conveyance of the Property and the assignment and assumption of the Regulatory Agreement and the Operation Agreement. 1 Acc,rcL'iy Requested by: Ft' TG Builder Services Nkr) h NO FEE DOCUMENT Government Code Section 27383 Recording requested by: When recorded mail to: Community Development Commission of the City of National City 140 E. 12th Street, Suite B National City, CA 91950-3312 Attention: Executive Director ASSIGNMENT, ASSUMPTION AND CONSENT AGREEMENT (Vista Del Sol -CDC -HA Recorded Documents) THIS ASSIGNMENT, ASSUMPTION AND CONSENT AGREEMENT ("Agreement") is dated as of the 18th day of December, 2017, Copper Hills Apartments Limited Partnership, a California limited partnership ("Assignor"), Vista Del Sol Apartments, L.P., a California limited partnership ("Assignee"), and the Community Development Commission -Housing Authority of the City of National City ("CDC -HA"). RECITALS A. Assignor and the CDC -HA are all of the current parties to: (i) that certain Regulatory Agreement and Declaration of Restrictive Covenants dated as of December 7, 1998, and recorded in the Office of the County Recorder for the County of San Diego on December 11, 1998 as Instrument Number 1998-0807600 ("Regulatory Agreement"); and (ii) that certain Operation and Maintenance Agreement dated as of December 7, 1998, and recorded in the Office of the County Recorder for the County of San Diego on December 11, 1998 as Instrument Number 1998-0807604 ("Operation Agreement"). B. Assignor desires to convey the real property ("Property") described in the Regulatory Agreement and the Operation Agreement to Assignee, and Assignor desires to assign its interests in the Regulatory Agreement and the Operation Agreement to Assignee, and Assignee desires to assume all of the interest, rights and responsibilities of Assignor under the Regulatory Agreement and the Operation Agreement from and after the date hereof. C. The consent of the CDC -HA is a condition precedent to conveyance of the Property and the assignment and assumption of the Regulatory Agreement and the Operation Agreement. 1 NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the CDC -HA, Assignor and Assignee hereby agree as follows: 1. Assignment. Assignor assigns and transfers all of its rights, title, interest and obligations under and pursuant to the Regulatory Agreement and the Operation Agreement to Assignee concurrently with the conveyance of the Property from Assignor to Assignee. 2. Assumption. Assignee assumes and agrees to perform all of the obligations, covenants and agreements of Assignor from and after the date hereof under the Regulatory Agreement and the Operation Agreement, in the manner, at the times and in all other respects as therein provided. Assignee further agrees to be bound by all of the terms, covenants and conditions contained in the Regulatory Agreement and the Operation Agreement from and after the date hereof as though the Regulatory Agreement and the Operation Agreement had been originally made, executed and delivered by Assignee. 3. Consent. The CDC -HA hereby consents to Assignor's conveyance of the Property to Assignee and the assignment of all of Assignor's rights, title, interest and obligations under and pursuant to the Regulatory Agreement and the Operation Agreement, consents to Assignee's assumption of the same, and agrees that the rights of Assignor under the Regulatory Agreement and the Operation Agreement shall inure to the benefit of Assignee. Assignor and Assignee hereby execute this Agreement, on the following express conditions and understandings: The consent of the CDC -HA to the assignment and assumption as contemplated by this Agreement shall not be deemed consent to any other or subsequent conveyances of the Property, or any part thereof. Assignee shall not convey or otherwise transfer all or any part of the Property without the prior written consent of the CDC -HA, which consent shall not be unreasonably withheld. Any conveyance or other transfer of all or any part of the Property without the prior written consent of the CDC -HA, shall be a material breach of the Regulatory Agreement, the Operation Agreement and this Agreement. 4. General Provisions. (a) Binding Effect/No Third Party Beneficiaries. All of the terms and provisions of this Agreement shall be binding upon and inure to the benefit to the parties hereto and respective heirs, legal representatives, successors and assigns. This Agreement is made for the sole benefit and protection of the parties hereto, and their successors and assigns, and no other party shall have any right of action or right to rely hereon. (b) No Novation. Except as amended in a particular agreement or document, the parties agree that this Agreement is not in any way intended to, and does not, revise, amend or otherwise affect any of the terms, conditions or priority of the Regulatory Agreement, the Operation Agreement or any other agreement or document by and between the CDC -HA, Assignor or Assignee, nor the enforcement thereof. The parties hereby agree the provisions of the Regulatory Agreement, the Operation Agreement and all other agreements or documents by and between the CDC -HA, Assignor or Assignee shall be and remain unmodified and in full force and effect. 2 (c) Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. (d) Signature Authority. All individuals signing this Agreement for a party which is a corporation, limited liability company, partnership or other legal entity, or signing under a power of attorney, or as a trustee, guardian, conservator, or in any other legal capacity, covenant to the others that they have the necessary capacity and authority to act for, sign and bind the respective entity or principal on whose behalf they are signing. IN WITNESS WHEREOF, this Agreement is executed to be effective as of the date first above written. ASSIGNOR: Copper Hills Apartments Limited Partnership, a California limited partnership By: Print Nanle: I I'-NAE' Its: CAZ [SIGNATURES CONTINUED ON FOLLOWING PAGE] 3 California All -Purpose Acknowledgment A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of San Bernardino S.S. On December 19, 2017 before me, Monica Rodriguez, Notary Public personally appeared Michael Finn who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my han an of cial seal. MONICA RODRIGUEZ Notary Public - California San Bernardino County Commission # 2194994 M Comm. Expires Ma 26, 2021 z z OPTIONAL INFORMATION kthgUilcC.1 uy fraugule:nt ieinuvdi ai1U iedlldGfinieiil of 1H acknowledgment to on !Ina! tthorized dncnment and may prove useful to -eIying on the attached document. Description of Attached Document The preceding Certificate of Acknowledgment is attached to a document titled/for the purpose of containing pages, and dated The signer(s) capacity or authority is/are as: ❑ Individual(s) ❑ Attorney -in -fact ❑ Corporate Officer(s) ❑ Guardian/Conservator ❑ Partner - Limited/General ❑ Trustee(s) ❑ Other: representing: bon Method of Signer Identification Proved to me on the basis of satisfactory evidence: ❑ form(s) of identification credible witness(es) Notarial event is detailed in notary journal on: Page # Entry # Notary contact: Other ❑ Additional Signer Li Signer(s) Thumbprints(s) ASSIGNEE: Vista Del Sol Apartments, L.P., a California limited partnership By: Vista Del Sol GP LLC, a California limited liability company, its general partner By: National Community Renaissance of California, a California nonprofit public benefit corporation, its managi • _ ,e By: Its: ,opt tip#✓ [SIGNATURES CONTINUED ON FOLLOWING PAGE] California All -Purpose Acknowledgment A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of San Bernardino S.S. On December 19, 2017 before me, Monica Rodriguez, Notary Public personally appeared Michael Finn who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and offiaJseal. ,�o,ouy.i the OPTIONAL INFORMATION MONICA RODRIGUEZ Notary Public - California San Bernardino County i z ' ' Commission # 2194994 My Comm. Expires Mayy 26, 2021 fraudulent removal and reattachment of 11 acknowledgment to an unauthorized document and may prove useful to nersons relying on the attached document. Description of Attached Document The preceding Certificate of Acknowledgment is attached to a document titled/for the purpose of containing pages, and dated The signer(s) capacity or authority is/are as: ❑ Individual(s) ❑ Attorney -in -fact ❑ Corporate Officer(s) Guardian/Conservator Partner - Limited/General Trustee(s) Other: representing: Add' l:Int Method of Signer Identification Proved to me on the basis of satisfactory evidence: ❑ form(s) of identification ❑ credible witness(es) Notarial event is detailed in notary journal on: Page # Entry # Notary contact: Other ❑ Additional Signer ❑ Signer(s) Thumbprints(s) CDC -HA: THE COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY, a public body corporate and politic By: L k•c Its: Executive Director Lf$t✓e pees Approve s to form: By: eputy City Attorney ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of San Diego On-ectN•6.e.r Cl , 2017, before me, R‘t , notary public, personally appeared l_e sly e j}ct yc_ who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under penalty of perjury under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature ANGELITA PALMA Commission No. 2215878 NOTARY PUBLIC - CALIFORNIA SAN DIEGO COUNTY Commission Expires October 25, 2021 6 (Seal) Notary Seal Certification (Government Code 27361.7) I certify under penalty of perjury that this material is a true copy of the original material contained in this document. Name of Notary: e ! I. T cl Pci'l d 22 / Sg 72Expires: ` - Date Commission ` Z Commission Number: County Where Bond is Filed: Manufacturer or Vendor Number: Sdn DiC yo Co (An y Fco_ (Located on both sides of the notary seal border) Signature: Calvin Williamson, Synrgo Agent San Diego Place of Execution Date: /2-/6( 7? State of California County of San Diego On ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. , 2017, before me, notary public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under penalty of perjury under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature (Seal) 7 State of California County of San Diego On ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. , 2017, before me, notary public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under penalty of perjury under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature (Seal) 8 Recording Requested by: FNTG Builder Services NO FEE DOCUMENT Government Code Section 27383 Recording requested by: When recorded mail to: Community Development Commission of the City of National City 140 E. 12th Street, Suite B National City, CA 91950.3312 Attention: Executive Director DOC# 2017-0605969 IIIIIIIIIIIIIIIIIIII IIIIII1I1IIl1IIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIII Dec 26, 2017 08:00 AM OFFICIAL RECORDS Ernest J. Dronenburg, Jr., SAN DIEGO COUNTY RECORDER FEES: $0.00 PAGES: 17 f1, 7 S� AMENDED AND RESTATED REGULATORY AGREEMENT THE COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY AND VISTA DEL SOL APARTMENTS, L.P. Recording Requested by: FNTG Builder Services NO FEE DOCUMENT Government Code Section 27383 Recording requested by: When recorded mail to: Community Development Commission of the City of National City 140 E. 12th Street, Suite B National City, CA 91950-3312 Attention: Executive Director AMENDED AND RESTATED REGULATORY AGREEMENT THE COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY AND VISTA DEL SOL APARTMENTS, L.P. AMENDED AND RESTATED REGULATORY AGREEMENT This Amended and Restated Regulatory Agreement ("Regulatory Agreement") is dated as of the 18th day of December, 2017, by and between the Community Development Commission -Housing Authority of the City of National City (the "CDC -HA"), a public body, corporate and politic and Vista Del Sol Apartments, L.P. ("Owner"), a California limited partnership. RECITALS This Regulatory Agreement is entered into based on the following facts and understandings of the parties: A. Concurrently herewith Owner is acquiring all of the real property ("Property") described in that certain Regulatory Agreement and Declaration of Restrictive Covenants dated as of December 7, 1998, and recorded in the Office of the County Recorder for the County of San Diego on December 11, 1998 as Instrument Number 1998-0807600 ("Previous Regulatory Agreement") originally made by Copper Hills Apartments Limited Partnership, a California limited partnership ("Prior Owner") the Community Development Commission of the City of National City ("Original Lender"). Owner proposes to acquire and rehabilitate a 132-unit rental housing project the Property, which is commonly known as Vista Del Sol Apartments at 1400, 1401, 1410, 1421, 1433, 1436, 1438, 1440, 1445, 1536, 1537, 1538, 1543, 1545 and 1500 Q Avenue, National City, California, which is rented at amounts affordable to certain income groups as specified herein. B. The acquisition and proposed rehabilitation is intended to serve as a community resource by providing decent, safe, and sanitary housing for households who would otherwise be unable to afford such housing. The CDC -HA has previously provided the properties with financial assistance in the form of loans from public funds to support development of the properties, in order to increase and improve the supply of housing available in the community to low and moderate -income households. C. The CDC -HA elected to retain the housing assets of and functions previously performed by the Original Lender pursuant to California Health and Safety Code Section 34176, and thereby, by operation of law, the CDC -HA assumed the rights and obligations of the Original Lender with respect to the Previous Regulatory Agreement. D. Concurrently herewith the Owner is acquiring the Property from Prior Owner and the Owner is assuming all of the rights and liabilities of the Original Owner with respect to the Previous Regulatory Agreement. The CDC -HA and Owner desire to amend and restate the Previous Regulatory Agreement in its entirety, as provided herein. This Regulatory Agreement has also been executed and recorded pursuant to the requirements of California Health and Safety Code Section 33334.3. The purpose of this Regulatory Agreement is to regulate and restrict the occupancy, rents, operation, ownership, and management of the property for the benefit of project occupants and the people of the City of National City. The covenants in this Regulatory Agreement are intended to run with the land and be binding on Owner and Owner's successors to the land for the full term of this Regulatory Agreement. NOW, THEREFORE, in consideration of the foregoing recitals (which are hereby incorporated into this Agreement) and the covenants and mutual obligations contained in this Regulatory Agreement, and in reliance on the representations and warranties set forth herein, Owner and the CDC -HA hereby amend and restate the Previous Regulatory Agreement in its entirety and agree as follows: DEFINITIONS 1. DEFINED TERMS. The following terms and their derivatives have the meanings set forth in this section wherever used in this Regulatory Agreement or attached exhibits. Capitalized terms not defined in this Regulatory Agreement shall have the same meaning as defined in the Loan Agreement: "CDC -HA" means the Community Development Commission -Housing Authority of the City of National City, a public body corporate and politic, along with any assigns, transferees, or successors -in - interest thereto. "City" means the City of National City. "Deed of Trust" means that certain Deed of Trust, Assignment of Rents, and Security Agreement placed on the Property concurrently herewith as security for the Loan and other obligations, with Owner as trustor and the CDC -HA as beneficiary, as well as any amendments to, modifications of, and restatements of the Deed of Trust. "Loan" means the loans provided by the CDC -HA to Owner's predecessor -in -interest as assumed by Owner in connection with the Property, in the current total amount of $7,407,795.08. "Loan Agreement" means that certain Amended and Restated Loan Agreement executed contemporaneous with this Regulatory Agreement between Owner and the CDC -HA which governs the Loan, as well as any amendments to, modifications of, or restatements of said agreement. "Loan Documents" mean collectively the Loan Agreement, Deed of Trust, and Note, as they may be amended, modified, or restated from time to time, along with all exhibits and attachments to these documents. "Note" mean that certain Consolidated, Amended and Restated Promissory Note executed by Owner in favor of the CDC -HA evidencing the Loan, which are secured by the Deed of Trust, as well as any amendments to, modifications of, or restatements of the Note. "Owner" means Vista Del Sol Apartments, L.P., a California limited partnership. "Project" means the rehabilitation of the Property for residential and other uses according to the terms of the Loan Agreement. "Project Unit" means any housing unit developed on the Property (but specifically excluding one unrestricted manager's unit). "Property" has the meaning ascribed to it in Recital A, above. AMENDED AND RESTATED AGREEMENT 2. TERMINATION OF PRIOR REGULATORY AGREEMENTS. This Regulatory Agreement amends and restates in its entirety the Previous Regulatory Agreement. The Previous Regulatory 2 Agreement is hereby terminated contemporaneously with execution of this Regulatory Agreement, and shall be of no further force or effect. OWNER'S OBLIGATIONS 3. COMPLIANCE WITH LOAN DOCUMENTS. Owner's actions with respect to the Property and the use of Loan funds must at all times be in full conformity with the requirements of the Loan Documents. Owner must complete the rehabilitation as required under the Loan Agreement. 4. TERM OF AGREEMENT. This Regulatory Agreement shall commence upon execution and shall continue until December 31, 2073. The obligations in this Regulatory Agreement shall remain effective and fully binding on the Property and the Owner, or Owner's successor in the event of any approved sale, assignment, transfer, or conveyance of the Property and release of the Owner (pursuant to the terms of the Loan Agreement and/or this Regulatory Agreement), for this full term regardless of any expiration of the term of the Loan, any payment or prepayment of the Loan, or any reconveyance of the Deed of Trust, unless terminated earlier by the CDC -HA in a recorded writing or extended by the mutual consent of the parties. PROJECT UNIT OCCUPANCY AND RENTS 5. USE COVENANT. Owner covenants by and for itself and any successors in interest that the use of the Property shall be restricted for the term of this Regulatory Agreement only to residential use and ancillary uses associated with residential use. 6. OCCUPANCY OF PROJECT UNITS. Owner must limit for the full term of this Regulatory Agreement the rental of Project Units to tenant households according to the occupancy requirements set forth in Exhibit A attached hereto. 7. RENTS FOR PROJECT UNITS. Owner must limit for the full tern of this Regulatory Agreement rents for Project Units to those rents specified in Exhibit A and in conformance with the rent - setting requirements in Exhibit A. 8. RELATIONSHIP TO TAX CREDIT REQUIREMENTS. Notwithstanding any other provisions of this Regulatory Agreement, to the extent that the regulatory agreement executed by the Owner as a requirement of receiving the Tax Credits (the "Tax Credit Regulatory Agreement") is less restrictive with respect to the requirements applicable to tenant selection, tenant income levels and unit rent levels than as provided in this Regulatory Agreement, this Regulatory Agreement shall control. 9. NONDISCRIMINATION. Owner may not discriminate or segregate in the use, enjoyment, occupancy, conveyance, lease, sublease, or rental of Project Units on the basis of race, color, ancestry, national origin, religion, sex, sexual preference, age, marital status, family status, source of income, physical or mental disability, Acquired Immune Deficiency Syndrome (AIDS) or AIDS -related conditions (ARC), or any other arbitrary basis. Owner shall not refuse to lease Project Units to a certificate or voucher holder under the Section 8 Rental Certificate Program or the Section 8 Rental Voucher Program, or to the holder of a comparable document evidencing participation in a tenant -based rental assistance program, because of the status of the prospective tenant as a holder of such certificate, voucher, or comparable tenant -based assistance document. Owner shall include a statement in all advertisements, notices and signs for the availability of Project Units for rent to the effect that Owner is an Equal Housing Opportunity Provider. 3 10. LEASE REQUIREMENTS. Prior to rental of any of the Project Units, the Owner shall submit a standard lease form to the CDC -HA for the CDC -HA approval, which approval shall not unreasonably be withheld or delayed. The Owner shall enter into a lease, in the form approved by the CDC -HA, with each tenant of a Project Unit. PROPERTY MANAGEMENT 11. MANAGEMENT RESPONSIBILITIES. Owner is responsible for contracting with a property manager who will be responsible for all management functions with respect to the Property, including without limitation the selection of tenants, certification and recertification of household size and income, evictions, collection of rents and deposits, maintenance, landscaping, routine and extraordinary repairs, replacement of capital items, and security. The CDC -HA shall have no responsibility over management of the Property. 12. MANAGEMENT ENTITY. The CDC -HA shall have the right to review and approve, with at least 90-days advance written notice, the management entity chosen by Owner for the Property, and the right to require a change in the management agent for reasonable cause at any time during the term of this Regulatory Agreement; provided however, that if Owner's lender does not require such a change in the management agent, then Owner and the CDC -HA shall endeavor to reach an agreement mutually acceptable between the CDC -HA and the Owner's lender over the issue. Any contracting of management services by Owner shall not relieve Owner of its primary responsibilities for proper performance of management duties. 13. MANAGEMENT PLAN AND CONTRACT. At least 180 calendar days prior to completion of rehabilitation of the Project, Owner must submit to the CDC -HA for review and approval a plan for marketing and managing the Property (the "Final Management Plan" or "Plan"). The Plan shall address how the Owner and the management entity plan to manage and maintain the Property, and shall include appropriate financial information and documentation, including, without limitation, a rent schedule and a projected operating budget for the first year of operation. The Plan shall include a form rental agreement that Owner proposes to enter into with Project tenants. Owner shall abide by the terms of this Plan in marketing, managing, and maintaining the Property. At least 90 calendar days prior to completion of rehabilitation of the Project, Owner must submit a proposed management contract to the CDC -HA for the CDC-HA's review and approval. The CDC -HA shall have the right to review and approve, with at least 90-days advance written notice, any proposed amendments to said contract or any new management contracts during the term of this Regulatory Agreement. If the CDC -HA has not responded to any submission of the Final Management Plan or management contract (including amendments) by Owner within 15 business days of receipt of such Plan or contract by the CDC -HA, the Plan or contract (including amendments) shall be deemed approved by the CDC -HA. 14. ANNUAL OPERATING BUDGETS. At least 90 calendar days prior to the commencement of a Property's fiscal year, Owner shall submit to the CDC -HA for the CDC-HA's review and approval a proposed operating budget for the coming year, in a form satisfactory to the CDC -HA. The proposed operating budget shall include projected income from all sources, projected expenses, including operating expenses, debt service and deposits to reserves, and projected distributions including without 4 limitation partnership management fees, asset management fees, deferred developer fees, and any other distributions to Owner or other parties. If the CDC -HA has not responded to any submission of the proposed operating budget by Owner within 20 business days of receipt of such operating budget by the CDC -HA, the operating budget shall be deemed approved by the CDC -HA. 15. DOCUMENTS TO BE MAINTAINED ON SITE. Owner shall at all times maintain on a Property site, in the rental office or otherwise in the control of the property manager, copies of the current Final Management Plan and operating budget, and copies of all regulatory agreements and other documents imposing limitations on rent or occupancy of any Project Units. 16. MAINTENANCE AND SECURITY. Owner at its own expense must maintain the Property in good condition, in good repair, and in decent, safe, sanitary, habitable and tenantable living conditions for the benefit of Project Unit occupants. Owner may not commit or permit any waste on or to the Property, and shall prevent and/or rectify any physical deterioration of the Property. Owner must provide adequate ongoing security equipment and services for Project Unit occupants. Owner must maintain the Property in conformance with all applicable state, federal, and local laws, ordinances, codes, and regulations and the Final Management Plan; but Owner's maintenance obligations are not limited only to the standards contained in these laws or the Plan. In the event that Owner fails to maintain the Property in accordance with these standards and after at least seven calendar days prior notice to Owner, the CDC -HA or its agent may, but shall be under no obligation to, enter upon the Property, make such repairs or replacements as are deemed necessary in the CDC-HA's reasonable discretion, and provide for payment thereof. Any amount advanced by the CDC - HA to make such repairs, together with interest thereon from the date of such advance at the same rate of indebtedness as specified in the Note with the highest interest rate for the Project (unless payment of such an interest rate would be contrary to applicable law, in which case interest shall accrue at the highest rate then allowed by applicable law), shall become an additional obligation of Owner to the CDC -HA and shall be secured by the Deed of Trust. 17. REPLACEMENT RESERVES. Concurrently herewith, Owner shall deposit the sum of Two Hundred Thousand and No/100 Dollars ($200,000.00) into a replacement reserve (the "Replacement Reserve") for the Property. In addition, commencing on the month following conversion of the permanent financing, Owner must deposit each year into the Replacement Reserve a minimum amount equal to $300 per unit per year. Replacement reserves may be used for repairs or replacements at the Property. 18. OPERATING RESERVES. Commencing on the month following conversion of the permanent financing, Owner must deposit each month into an operating reserve for the Property a minimum amount equal to 2% of the gross rental income from the Property, until the operating reserve is equal to at least three months of operating costs (including debt service) of the Property. Owner must maintain the operating reserve at that level, or, following draws on that reserve, must bring the reserve back up to that level from available sources within a reasonable time, for the term of this Regulatory Agreement. The CDC - HA must approve in advance any withdrawal from the replacement reserve or the operating reserve. 19. VACANCIES. Owner is required to use its best efforts to fill vacancies in Project Units as quickly as possible. Excessive or continuing Property vacancies shall constitute a breach of this Regulatory Agreement. 5 20. INSPECTION AND RECORDS. Owner must maintain records which clearly document Owner's performance of its obligations to operate the Property under the terms of this Regulatory Agreement. Owner must submit any Property -related records to the CDC -HA within ten business days of the CDC -HA' s request. Owner shall permit representatives of the CDC -HA to enter and inspect the Property for compliance with obligations under this Regulatory Agreement upon 24 hours advance notice of such visit to Owner or Owner's management agent, as permitted under applicable law. 21. ANNUAL REPORTS. Owner must submit an annual report to the CDC -HA, on a form provided by the CDC -HA, which, at a minimum, shall state for each Assisted Unit the rental rate (including any rental assistance received on behalf of the tenant household) and the income, household size, race and ethnicity of the occupants. The income information required under this report shall be determined in accordance with the provisions of Exhibit A to this Agreement. In addition, Owner must submit an annual financial report for the Property to the CDC -HA, in a form reasonably satisfactory to the CDC -HA (but the CDC -HA shall not require that such report be audited), which includes an accounting of all revenue (including rental revenue, rental assistance payments and miscellaneous revenue), operating expenses, debt service payments, deposits to reserves and distributions to Owner or other parties. The report shall include certification of the required deposits to, withdrawals from and balances of the replacement and operating reserves. Commencing upon completion of rehabilitation, Owner shall pay to the CDC -HA an annual monitoring fee ("Loan Monitoring Fee"), as determined by the CDC -HA in schedules printed by the CDC - HA from time to time. The Loan Monitoring Fee shall be subject to revision annually. The Loan Monitoring Fee shall be paid to the CDC -HA annually within ten (10) days after the CDC -HA provides a written invoice to Owner for the same. Failure to timely pay the Loan Monitoring Fee shall constitute a material default under the Loan Agreement and this Regulatory Agreement. The Loan Monitoring Fee shall be paid to the CDC -HA as a consideration for the lending of funds by the CDC -HA to the Owner. 22. FEES, TAXES, AND OTHER LEVIES. Owner shall be responsible for payment of all fees, assessments, taxes, charges, liens and levies imposed by any public authority or utility company with respect to the Property, and shall pay such charges prior to delinquency. However, Owner shall not be required to pay any such charge so long as (a) the legality thereof is being contested in good faith and by appropriate proceedings, and (b) Owner maintains reserves adequate to pay any contested liabilities. 23. INSURANCE COVERAGE. Owner is required to have or cause to have in full force and effect during the term of this Regulatory Agreement insurance coverage as required under the Loan Agreement. 24. PROPERTY DAMAGE OR DESTRUCTION. If any building or improvements erected by Owner on the Property is damaged or destroyed, Owner must, at its own cost and expense, repair or restore the Property consistent with the original Plans and Specifications for the Project. Such work shall be commenced within 120 days after the damage or loss occurs and shall be completed within one year thereafter. All insurance proceeds collected for such damage or destruction shall be applied to the cost of such repairs or restorations. GENERAL PROVISIONS 25. TRANSFER AND ENCUMBRANCE OF PROPERTY. During the term of this Regulatory Agreement, and except as otherwise permitted herein or in the Loan Agreement, Owner may not make or permit any sale, agreement to sell, assignment, conveyance, further encumbrance, lease (other than 6 the rental of Project Units to eligible residential tenant occupants), or transfer the Property or any part thereof, including any substantial change in operational or management control over the Property (collectively referred to as "Transfers"), without the prior written consent of the CDC -HA in its sole discretion. Any such unauthorized Transfer shall be void. Notwithstanding the foregoing, the transfers of limited partnership interests to affiliates and the removal of the general partner as set forth in the Loan Agreement shall be permitted without CDC -HA consent. Owner shall be permitted to refinance senior debt with the prior written consent of the CDC -HA, which consent will not be unreasonably withheld, conditionedor delayed, provided however, Owner shall be permitted to refinance senior debt without the consent of the CDC -HA only if: (i) the monthly payment amount of the new debt does not exceed the monthly payment amount of the senior debt; and (ii) the original principal amount of the new debt does not exceed the then outstanding principal balance of the senior debt. The CDC -HA shall take all steps and execute all documents which may be reasonably necessary to subordinate the applicable deed of trust to the lien securing such new loan, provided the aforementioned conditions are satisfied. 26. DEFAULT AND REMEDIES. A breach of any agreement, obligation, or warranty under this Regulatory Agreement shall be an Owner default. The CDC -HA shall give written notice to Owner of any such default. Said notice shall specify the nature of the act, omission, or deficiency giving rise to the default. In addition, if the default is curable and does not give rise to an imminent danger to health or safety, then the notice shall also specify the action required to cure the default. If the default is not cured within 30 calendar days or the Borrower does not commence such cure within 30 calendar days and diligently pursue the cure to completion within a reasonable time thereafter, the CDC -HA may proceed with all of its rights and remedies under the terms of the Loan Agreement, this Regulatory Agreement or at law, including without limitation, any of the following: A. Bring an action for equitable relief seeking the specific performance by Owner of the terms and conditions of this Regulatory Agreement, and/or enjoining, abating, or preventing any violation of said terms and conditions, and/or seeking declaratory relief; B. Enter upon, take possession of, and manage a Property, either in person, by agent, or by a receiver appointed by a court, and collect any rents, income, deposits, or reserves and apply them to operate the Property, and continue in possession until such time as the CDC -HA in its reasonable judgment determines that Owner is in a position to operate the Property in compliance with this Regulatory Agreement; C. Make such repairs or replacements to a Property as are necessary and provide for payment thereof; or D. Pursue any other remedy allowed at law or in equity. 27. NON -LIABILITY OF OFFICIALS, EMPLOYEES AND AGENTS. No member, official, officer, director, employee, or agent of the CDC -HA or the City shall be personally liable to Owner for any obligation created under the terms of this Regulatory Agreement, except in the case of actual fraud or willful misconduct by such person. 28. INDEMNITY. Notwithstanding the insurance coverage required herein, Owner hereby indemnifies and holds the CDC -HA, the City, and their respective members, officials, officers, directors, employees, and agents (collectively, the "Indemnified Parties") harmless from any losses, damages, liabilities, claims, demands, judgments, actions, court costs, and legal or other expenses (including reasonable attorneys' fees) which an Indemnified Party may incur as a result of (1) Owner's failure to 7 perform any obligations as and when required by this Regulatory Agreement; or (2) any failure of Owner's representations or warranties to be true and complete; or (3) any act or omission by Owner or any contractor, subcontractor, management agent, or supplier with respect to the Property, except to the extent that such losses are caused by the negligence or willful misconduct of the CDC -HA. Owner shall pay immediately upon an Indemnified Party's demand any amounts owing under this indemnity. The duty of the Owner to indemnify includes the duty to defend the Indemnified Party in any court action, administrative action, or other proceeding brought by any third party arising from the Property. Owner's duty to indemnify an Indemnified Party shall survive the term of this Regulatory Agreement. 29. GOVERNING LAW. This Regulatory Agreement shall be interpreted under and be governed by the laws of the State of California, except for those provisions relating to choice of law and those provisions preempted by federal law. 30. REGULATORY AGREEMENT CONTROLS. In the event that any provisions of this Regulatory Agreement and the Loan Agreement conflict, the terms of this Regulatory Agreement shall control. 31. ATTORNEYS' FEES AND COSTS. In the event that a legal or administrative action is brought to interpret or enforce the terms of this Regulatory Agreement, the prevailing party shall be entitled to recover all reasonable attorneys' fees and costs incurred in such action. 32. TIME. Time is of the essence in the performance of this Regulatory Agreement by Owner and the CDC -HA. 33. CONSENTS AND APPROVALS. Any consent or approval required under this Regulatory Agreement shall not be unreasonably withheld, delayed, or conditioned. 34. NOTICES, DEMANDS AND COMMUNICATIONS. Formal notices, demands and communications between Owner and the CDC -HA shall be given by registered or certified mail, postage prepaid, return receipt requested, or delivered personally, to the principal offices of Owner and the CDC - HA as follows, or if any such office is relocated, to the new address specified by the relocated party: CDC -HA: Community Development Commission -Housing Authority of the City of National City 140 East 12th Street National City, CA 91950-3312 Attn: Executive Director OWNER: Vista Del Sol Apartments, L.P. 9421 Haven Avenue Rancho Cucamonga, CA 91730 35. BINDING UPON SUCCESSORS; COVENANTS TO RUN WITH THE LAND. All provisions of this Regulatory Agreement shall be binding upon and inure to the benefit of the heirs, administrators, executors, successors -in -interest, transferees, and assigns of Owner and the CDC -HA, regardless of any assignment, payment, prepayment, expiration, extinguishment of the Loan or Note, any reconveyance of the Deed of Trust, or any conveyance or transfer of the Property. Any successor -in - interest to Owner and any purchaser or transferee of the Property shall be subject to all of the duties and obligations imposed on Owner under this Regulatory Agreement for the full term of this Regulatory Agreement. The term "Owner" as used in this Regulatory Agreement shall include all such assigns, 8 successors -in -interest, and transferees. Upon the transfer of a Property, the transferring Owner shall be released from all obligations and liabilities hereunder. The parties intend that the covenants contained in this Regulatory Agreement shall constitute covenants running with the land and shall bind the Property during the term of this Agreement. Owner agrees for itself and for its successors that in the event that a court of competent jurisdiction determines that the covenants herein do not run with the land, such covenants shall be enforced as equitable servitudes against the Property. 36. RELATIONSHIP OF PARTIES. The relationship of Owner and the CDC -HA with respect to the Property during the term of this Regulatory Agreement shall not be construed as a joint venture, equity venture, or partnership. The CDC -HA neither undertakes nor assumes any responsibility or duty to Owner or to any third party with respect to the operation of the Property or the actions of Owner. Except as the CDC -HA may specify in writing, Owner shall have no authority to act as an agent of the CDC -HA or to bind the CDC -HA to any obligation. 37. WAIVER. Any waiver by the CDC -HA of any obligation in this Regulatory Agreement must be in writing. No waiver will be implied from any delay or failure by the CDC -HA to take action on any breach or default of Owner or to pursue any remedy allowed under this Regulatory Agreement or applicable law. Any extension of time granted to Owner to perform any obligation under this Regulatory Agreement shall not operate as a waiver or release from any of its obligations under this Regulatory Agreement. Consent by the CDC -HA to any act or omission by Owner shall not be construed to be a consent to any other or subsequent act or omission or to waive the requirement for the CDC-HA's written consent to future waivers. 38. OTHER AGREEMENTS. Owner represents that it has not entered into any agreements that would restrict or compromise its ability to comply with the terms of this Regulatory Agreement. Owner shall not enter into any agreements that are inconsistent with the terms of this Regulatory Agreement without an express written waiver by the CDC -HA. 39. AMENDMENTS AND MODIFICATIONS. Any amendments or modifications to this Regulatory Agreement must be in writing, and shall be effective only if executed by both Owner and the CDC -HA. 40. SEVERABILITY. Every provision of this Regulatory Agreement is intended to be severable. If any provision of this Agreement is held invalid, illegal, or unenforceable by a court of competent jurisdiction, the validity, legality, and enforceability of the remaining provisions shall not be affected or impaired. 41. EXHIBIT. The following Exhibit is attached to this Regulatory Agreement and is hereby incorporated into this Loan Agreement by reference: Exhibit A: Occupancy and Rent Restrictions 9 42. COUNTERPARTS. This Regulatory Agreement may be signed in multiple counterparts, which, when signed by all parties, shall constitute a binding agreement. IN WITNESS WHEREOF, the undersigned parties have executed this Regulatory Agreement, effective as of the date first written above. "OWNER" VISTA DEL SOL APARTMENTS, L.P., a California limited partnership By: Vista Del Sol GP LLC, a California limited liability company, its general partner By: National Community Renaissance of California, a California nonprofit public benefit corporation, its managingmemb By: Its: OF MIGN 60) ]SIGNATURES CONTINUED ON FOLLOWING PAGE] 10 "CDC -HA" THE COMMUNITY DEVELOPMENT COMMISSION -HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY, a public body corporate and politic By: Its: Executive Director LESL✓E D EKC Approved as to form: By: Deputy City Attorney CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California ) County of sa.v+ tXe.10 ) On peccMlxlr 1-112otbefore me, ett -A , Notary Public, personally appeared, Les liti D-e. , who proved to me the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her their authorized capacity(ies), and that by his/her/their signature (s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under penalty of perjury under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official Signature ANGELITA PALMA Commission No. 2215878 NOTARY PUBLIC - CALIFORNIA o SAN DIEGO COUNTY 1 Commission Expires October 25, 2021 12 AMENDED AND RESTATED REGULATORY AGREEMENT EXHIBIT A OCCUPANCY AND RENT RESTRICTIONS 1. Definitions. For purposes of this Exhibit A, the following terms have the following meanings: (i) "Lower Income Household (60% AMI)" shall mean a household earning not greater than sixty percent of Los Angeles County median income, adjusted for family size, as set forth from time to time by regulation of the California Department of Housing and Community Development. (ii) "Rent" shall mean the total of monthly payments by the tenants of a Project Unit for use and occupancy for the Project Unit and facilities associated therewith, including a reasonable allowance for utilities for an adequate level of service, as defined in 25 California Code of Regulations Section 6918. (iii) "Very Low Income Household (50% AMI)" shall mean a household earning not greater than the applicable percentage of Los Angeles County median income for very low income households, adjusted for family size, as set forth by regulation of the California Department of Housing and Community Development, pursuant to Health and Safety Code Section 50105. 2. Number of Affordable Units. Owner agrees to make available, restrict occupancy to, and rent (a) one hundred three (103) of the Project Units to Lower Income (60% AMI) Households, and (b) twenty-seven (27) of the Project Units to Very Low Income (50% AMI) Households, all at an Affordable Rent. At least sixty-two (62) of the Housing Units rented to Lower Income Household (60% AMI) shall be one bedroom units, and at least sixteen (16) of the Housing Units rented to Very Low Income Households (50% AMI) shall be one bedroom units. No more than two units may be set aside for managers and maintenance personnel. 3. Selection of Tenants. Owner shall be responsible for the selection of tenants for the Project Units in compliance with lawful and reasonable criteria, and in accordance with the procedures set forth in the Management Plan which is submitted to and approved by the CDC - HA in accordance with the terms of the Loan Documents. 4. Household Income Requirements. Following the initial lease -up of the Project Units, and annually thereafter, the Owner shall submit to the CDC -HA, at Owner's expense, a summary of the income, household size and rent payable by each of the tenants of the Project Units. At the CDC-HA's request, the Owner shall also provide to the CDC -HA completed income computation and certification forms, in a form acceptable to the CDC -HA, for any such tenant or tenants. Owner shall, prior to the initial leasing of a Project Unit and on an annual basis thereafter, obtain a certification from each tenant leasing a Project Unit demonstrating that such tenant is a Very Low Income Household (50% AMI) or Lower Income Household (60% AMI), as applicable, and meets the eligibility requirements established for the Project Unit. Owner shall 13 r verify the income of each proposed and existing tenant of the Project Units in the Project by at least one of the following methods as appropriate: (i) obtain two (2) paycheck stubs from the person's two (2) most recent pay periods. (ii) obtain a true copy of an income tax return from the person for the most recent tax year in which a return was filed. (iii) obtain an income verification certification from the employer of the person. (iv) obtain an income verification certification from the Social Security Administration and/or the California Department of Social Services if the person receives assistance from such agencies. (v) obtain an alternate form of income verification reasonably acceptable to the Agency, if none of the above forms of verification is available to the Owner. 5. Determination of Affordable Rent for the Project Units. Each Project Unit which is restricted hereunder shall be rented at an "Affordable Rent" to be established as provided herein. (i) The maximum monthly Rent for the Project Units to be rented to Very Low Income Households (50%) shall be established at one -twelfth (1/12) of thirty percent (30%) of fifty percent (50%) of Los Angeles County median income for a family of a size appropriate to the Project Unit (as defined in Health and Safety Code Section 50053). (ii) The maximum monthly Rent for the Project Units to be rented to Lower Income Households (60% AMI) shall be established at one -twelfth (1/12) of thirty percent (30%) of sixty percent (60%) of Los Angeles County median income for a family of a size appropriate to the Project Unit (as defined in Health and Safety Code Section 50053). 6. Occupancy Standards. Occupancy of one bedroom Project Units shall be limited to three persons, occupancy of two bedroom Project Units shall be limited to five persons and occupancy of three bedroom Project Units shall be limited to seven persons. 14 California All -Purpose Acknowledgment A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of San Bernardino S.S. On December 19, 2017 before me, Monica Rodriguez, Notary Public personally appeared Michael Finn who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. -.,f Notary F.. OPTIONAL INFORMATION z z MONICA RODRIGUEZ Notary Public - California San Bernardino County Commission # 2194994 M Comm. Expires May 26, 2021 z z nis st, acknowledgment to an unauthorized document and may prove useful to percnns relying on the attached document. Description of Attached Document The preceding Certificate of Acknowledgment is attached to a document titled/for the purpose of containing pages, and dated The signer(s) capacity or authority is/are as: O Individual(s) O Attorney -in -fact ❑ Corporate Officer(s) ❑ Guardian/Conservator ❑ Partner - Limited/General ❑ Trustee(s) ❑ Other: representing: Method of Signer Identification Proved to me on the basis of satisfactory evidence: (� form(s) of identification ❑ credible witness(es) Notarial event is detailed in notary journal on: Page # Entry # Notary contact: Other ❑ Additional Signer Signer(s) Thumbprints(s) Notary Seal Certification (Government Code 27361.7) I certify under penalty of perjury that this material is a true copy of the original material contained in this document. Name of Notary: All 9� l,' -/-d Palms Commission Number: 2- Sg 7 8 Date Commission Expires: l f ( "r County Where Bond is Filed: Sd✓1 D, e-9 o Co (44 f Y Manufacturer or Vendor Number: PC O (Located on both sides of the notary seal border) Signature: San Diego Place of Execution Calvin Williamson, Synrgo Agent Date: /(7/7 4 Recording Requested by: FNTG Builder Services NO FEE DOCUMENT Government Code Section 27383 Recording requested by: Community Development Commission of the City of National City When recorded mail to: Community Development Commission of the City of National City 140 E. 12th Street, Suite B National City, CA 91950-3312 Attention: Executive Director DOC# 2017-0605970 IIIIIIIIIIIIIIIIIIIIIIIIIIIII IIIIII1111IIIIIIIIIIIIIIIIIII1IIIIIIII Dec 26, 2017 08:00 AM OFFICIAL RECORDS Ernest J. Dronenburg, Jr., SAN DIEGO COUNTY RECORDER FEES: $0.00 PCOR: N/A PAGES: 20 f1)Oi9i-$ DEED OF TRUST, ASSIGNMENT OF RENTS, AND SECURITY AGREEMENT (Securing loan of $7,407,795.08) This Deed of Trust, Assignment of Rents, and Security Agreement ("Deed of Trust") is dated as of the 18t day of December, 2017, by Vista Del Sol Apartments, L.P., a California limited partnership ("Trustor" or "Borrower), to Fidelity National Title Company as trustee ("Trustee"), for the benefit of Community Development Commission -Housing Authority of the City of National City, a public body, corporate and politic ("Beneficiary" or "Lender"). This Deed of Trust is being executed in order to secure Beneficiary's interest as a governmental agency in ensuring both that public funds loaned for project development are repaid, and that housing projects assisted by public funds are developed and operated in a manner that is consistent with the public interest. GRANT IN TRUST 1. GRANT. Trustor, in consideration of the indebtedness referred to below, hereby irrevocably grants and conveys to Trustee, IN TRUST, WITH POWER OF SALE, for the benefit and security of Beneficiary, all ofTrustor's interest in the land and improvements on the property located in the City of National City, County of San Diego, State of California, and described in the attached Exhibit A, incorporated herein by this reference (the "Property"), which is located at the following street address: 1400, 1401, 1410, 1421, 1433, 1436, 1438, 1440, 1445, 1536, 1537, 1538, 1543, 1545 and 1500 Q Avenue, National City, California; TOGETHER WITH all interest, estates or other claims, both in law and in equity which Trustor now has or may hereafter acquire in the Property; all buildings, structures, fixtures, improvements, signs, and landscaping now or hereafter erected or located on the Property, including all equipment and machinery used for supplying or distributing heating, cooling, electricity, gas, water, air, and Tight, all kitchen and laundry appliances such as washers, dryers, refrigerators, garbage disposals, ovens, ranges, dishwashers, all plumbing and bathroom fixtures, all security and access control equipment, fire prevention and extinguishment equipment, elevators, floor coverings, window coverings, paneling, cabinets, (provided, however, that Trustor shall have the right to remove, if necessary, such fixtures, furnishings, and equipment for the purpose of replacement with similar items of the same quality performing the same functions, which replacements shall themselves become part of this grant); all building material and I g Recording Requested by: FNTG Builder Services NO FEE DOCUMENT Government Code Section 27383 Recording requested by: Community Development Commission of the City of National City When recorded mail to: Community Development Commission of the City of National City 140 E. 12th Street, Suite B National City, CA 91950-3312 Attention: Executive Director DEED OF TRUST, ASSIGNMENT OF RENTS, AND SECURITY AGREEMENT (Securing loan of $7,407,795.08) This Deed of Trust, Assignment of Rents, and Security Agreement ("Deed of Trust") is dated as of the 18th day of December, 2017, by Vista Del Sol Apartments, L.P., a California limited partnership ("Trustor" or "Borrower), to Fidelity National Title Company as trustee ("Trustee"), for the benefit of Community Development Commission -Housing Authority of the City of National City, a public body, corporate and politic ("Beneficiary" or "Lender"). This Deed of Trust is being executed in order to secure Beneficiary's interest as a governmental agency in ensuring both that public funds loaned for project development are repaid, and that housing projects assisted by public funds are developed and operated in a manner that is consistent with the public interest. GRANT IN TRUST 1. GRANT. Trustor, in consideration of the indebtedness referred to below, hereby irrevocably grants and conveys to Trustee, IN TRUST, WITH POWER OF SALE, for the benefit and security of Beneficiary, all of Trustor's interest in the land and improvements on the property located in the City of National City, County of San Diego, State of California, and described in the attached Exhibit A, incorporated herein by this reference (the "Property"), which is located at the following street address: 1400, 1401, 1410, 1421, 1433, 1436, 1438, 1440, 1445, 1536, 1537, 1538, 1543, 1545 and 1500 Q Avenue, National City, California; TOGETHER WITH all interest, estates or other claims, both in law and in equity which Trustor now has or may hereafter acquire in the Property; all buildings, structures, fixtures, improvements, signs, and landscaping now or hereafter erected or located on the Property, including all equipment and machinery used for supplying or distributing heating, cooling, electricity, gas, water, air, and light, all kitchen and laundry appliances such as washers, dryers, refrigerators, garbage disposals, ovens, ranges, dishwashers, all plumbing and bathroom fixtures, all security and access control equipment, fire prevention and extinguishment equipment, elevators, floor coverings, window coverings, paneling, cabinets, (provided, however, that Trustor shall have the right to remove, if necessary, such fixtures, furnishings, and equipment for the purpose of replacement with similar items of the same quality performing the same functions, which replacements shall themselves become part of this grant); all building material and 1 equipment either now or hereafter delivered to the Property and intended to be installed therein or any such material and equipment purchased with Loan proceeds whether or not located on the Property; all reserves, accounts, deferred payments, and refunds relating to development on the Property; all rents and income generated by the Property or improvements thereon (subject however to the assignment of rents to Lender contained herein); all leases, subleases and rental agreements covering the Property or any portion thereof now existing or hereafter entered into, and all interests of Trustor in security deposits, advance rentals, accounts, or payments of similar nature with respect to such leases, subleases, or rental agreements; all easements and rights -of -way appurtenant to the Property, including parking and recreational easements, and all interests of Trustor in any land lying within the right-of-way of any street, sidewalks, and areas of land adjacent to or used in connection with the Property; all development rights and credits, air rights, water rights, and oil, gas or mineral rights with respect to the Property; all claims or demands with respect to insurance proceeds, and all awards made for a taking by eminent domain; all interests and rights in any private or government grants, subsidies, loans, or other financing with respect to development on the Property; all interests in personal property used in and about the Property (except furniture and other personal property of occupants of dwelling units on the Property); all intangible property and rights relating to the Property or operations on the Property, including trade names, goodwill, trademarks, and service marks; all government permits, approvals, and map rights related to construction on the Property; all architectural, structural, and mechanical plans, specifications, designs, studies, and data with respect to construction of improvements on the Property; all environmental tests, studies and reports with respect to the Property; all current and future claims and rights of action of Trustor against prior owners and operators of the Property, neighboring property owners and operators, tenants and former tenants, consultants, advisors, and other third parties with respect to environmental or Hazardous Materials contamination and cleanup of the Property under any federal, state, or local ordinances, statutes, regulations, or administrative decisions or common law. All of the foregoing, together with the Property, is herein referred to as the "Security." OBLIGATIONS SECURED 2. Trustor makes this grant for the purpose of securing the following obligations: A. Repayment of the indebtedness of Trustor to Beneficiary in the principal sum of Seven Million Four Hundred Seven Thousand Seven Hundred Ninety -Five and 08/100 Dollars ($7,407,795.08) with interest thereon (the "Loan") evidenced by that certain Consolidated, Amended and Restated Promissory Note of even date herewith executed by Trustor (the "Note," on file at the offices of Beneficiary, which is hereby incorporated into this Deed of Trust by this reference), along with any extensions, amendments, modifications, or renewals to the Note; and B. Payment of any sums advanced by Beneficiary to protect the security and priority of this Deed of Trust; and C. Payment of any sums advanced by Beneficiary following a breach of Trustor's obligation to advance such sums and the expiration of any applicable cure period, with interest thereon as provided herein; and D. Performance of every obligation, covenant or agreement of Trustor contained in this Deed of Trust, the Note, and that certain Amended and Restated Loan Agreement of even date herewith executed between Trustor and Beneficiary for the Loan (the "Loan Agreement", on file at the offices of Beneficiary, which is hereby incorporated into this Deed of Trust 2 by this reference), including all modifications, extensions and renewals of these obligations; and E. Performance of any other obligation or repayment of any other indebtedness of Trustor to Beneficiary, where such evidence of obligation or indebtedness specifically recites that it is secured by this Deed of Trust; F. Performance of any obligations of Trustor under that certain Amended and Restated Regulatory Agreement among Trustor, Beneficiary and the City of National City covering the Project or the Security (the "Regulatory Agreement"). ABSOLUTE ASSIGNMENT OF RENTS AND RIGHT TO POSSESSION 3. ASSIGNMENT. As additional security, Trustor hereby assigns to Beneficiary: (a) all of the rents, revenues, profits, and income from the Security, any deposits now or hereafter in Trustor's possession which have been collected with respect to the Security, and any reserve or capital funds now or hereafter held by Trustor with respect to construction or operation of the Security (collectively, the "Rents"); and (b) the right to enter, take possession of, and manage the Security; provided however that Trustor shall have, before an Event of Default, the exclusive right to possess the Security and to collect Rents and use them in accordance with the Loan Documents. This assignment is intended to be an absolute and present transfer of Trustor's interest in existing and future Rents, effective as of the date of this Deed of Trust. 4. ENFORCEMENT. Upon the happening of an Event of Default which has not been cured in the manner and time provided in the Loan Agreement, Beneficiary may, in addition to other rights and remedies permitted by the Loan Agreement, this Deed of Trust, or applicable law, (a) enter upon, take possession of, and manage the Security, either in person as a mortgagee -in -possession, by agent, or by a receiver appointed by a court, and do any acts which it deems necessary or desirable to preserve the value, marketability or rentability of the Security, (b) collect all Rents, including those past due and unpaid, and apply the same to pay for the costs and expenses of operation of the Security, including attorneys' fees, and pay off any indebtedness secured by this Deed of Trust, all in such order as Beneficiary may determine, and/or (c) enter upon and take possession of the Security. Beneficiary may make, cancel, enforce, and modify leases and rental agreements, obtain and evict tenants, set and modify rent terms, sue for rents due, enter into, modify, or terminate any contracts or agreements, or take any legal action, as it deems necessary with respect to the Rents or to development or operation of the Security. 5. APPOINTMENT OF A RECEIVER. In any action to enforce this assignment, Beneficiary may apply for the appointment of a receiver to take possession of the Security and take whatever measures are necessary to preserve and manage the Security for the benefit of Beneficiary and the public interest. Trustor hereby consents to the appointment of a receiver. The receiver shall have all of the authority over the Security that Beneficiary would have if Beneficiary took possession of the Security under this assignment as a mortgagee -in -possession, including the right to collect and apply Rents and the right to complete construction of improvements. 6. NO WAIVER OF POWER OF SALE. The entering upon and taking possession of the Security and the collection of Rents shall not cure or waive any default or notice of default hereunder or invalidate any act done in response to such default or notice of default and, notwithstanding the continuance in possession of the Security or the collection and application of Rents, Beneficiary shall be entitled to exercise every right provided for in this Deed of Trust or by law upon occurrence of any Event of Default, including the right to exercise the power of sale. 3 COMMERCIAL CODE SECURITY AGREEMENT 7. GRANT. This Deed of Trust is intended to be a security agreement and financing statement pursuant to the California Commercial Code for any of the items specified above as part of the Security which under applicable law may be subject to a security interest pursuant to the Commercial Code, and Trustor hereby grants Beneficiary a security interest in said items. Beneficiary may file a copy of this Deed of Trust in the real estate records or other appropriate index as a financing statement for any of the items specified as part of the Security. Trustor shall execute and deliver to Beneficiary at Beneficiary's request any financing statements, as well as extensions, renewals, and amendments thereof, and copies of this instrument in such form as Beneficiary may require to perfect a security interest with respect to said items. Trustor shall pay all costs of filing such financing statements and shall pay all reasonable costs of any record searches for financing statements and releases. Without the prior written consent of Beneficiary, Trustor shall not create or permit any other security interest in said items. 8. REMEDIES. Upon Trustor's breach of any obligation or agreement in the Loan Documents, Beneficiary shall have the remedies of a secured party under the Commercial Code and at Beneficiary's option may also invoke the remedies provided for elsewhere in this Deed of Trust with respect to said items. Beneficiary may proceed against the items of real property and personal property specified above separately or together and in any order whatsoever. RIGHTS AND OBLIGATIONS OF TRUSTOR 9. PERFORMANCE OF SECURED OBLIGATION. Trustor must perform each obligation secured by this Deed of Trust within the time provided herein. 10. PAYMENT OF PRINCIPAL AND INTEREST. Trustor must pay the principal and interest on the indebtedness evidenced by the Note when required under the Note. 11. MAINTENANCE OF THE SECURITY. Trustor must, at the Trustor's own expense, maintain and preserve the Security or cause the Security to be maintained and preserved as required under the Regulatory Agreement. Trustor may not commit or permit material waste on or to the Security. Trustor may not abandon the Security. Beneficiary shall have no responsibility over maintenance of the Security. In the event Trustor fails to maintain the Security in accordance with the standards in the Regulatory Agreement, Beneficiary may take such action with respect thereto as is provided in the Regulatory Agreement and any amount so advanced by Beneficiary, together with interest thereon from the date of such advance at the same rate of indebtedness as specified in the Note with the highest interest rate (unless payment of such an interest rate would be contrary to applicable law, in which case interest shall accrue at the highest rate then allowed by applicable law), shall become an additional obligation of Trustor to Beneficiary and shall be secured by this Deed of Trust. 12. INSPECTION OF THE SECURITY. Trustor must permit Beneficiary to enter and inspect the Security for compliance with these obligations upon one business day's advance written notice of such visit by Beneficiary to Trustor. 13. LIENS, ENCUMBRANCES, AND CHARGES. Trustor must discharge any lien or encumbrance not approved by Beneficiary in writing that may attain priority over this Deed of Trust, as provided for in the Loan Agreement, provided Trustor will have the right to reasonably contest same in good faith, provided, however, Beneficiary hereby approves those liens and encumbrances approved by Beneficiary as exceptions in the policy of title insurance that insures the validity and priority of this Deed of Trust (the "Permitted Encumbrances"). 4 14. DEFENSE AND NOTICE OF CLAIMS AND ACTIONS. Trustor must appear in and defend, at its own expense, any action or proceeding purporting to affect the Security and/or the rights of Beneficiary. Trustor must give Beneficiary and Trustee prompt notice in writing of the assertion of any claim, of the filing of any action or proceeding and of any condemnation offer or action with respect to the Security not filed by the Beneficiary or the City of National City. 15. SUITS TO PROTECT THE SECURITY. Beneficiary shall have the power, after at least thirty (30) days' prior written notice to Trustor, to institute and maintain such suits and proceedings as it may deem reasonably necessary: (a) to prevent any impairment of the Security or the rights of Beneficiary, (b) to preserve or protect its interest in the Security and in the Rents, and (c) to restrain the enforcement of or compliance with any governmental legislation, regulation, or order, if the enforcement of or compliance with such legislation, regulation, or order would impair the Security or be prejudicial to the interest of Beneficiary, and provided nothing contained herein will be construed as a waiver of Trustor's rights to contest any relevant governmental legislation, regulation, or order. 16. DAMAGE TO SECURITY. Trustor must give Beneficiary prompt notice in writing of any damage to the Security. If any building or improvements erected on the Property is damaged or destroyed, Trustor shall comply with any relevant provisions of the Regulatory Agreement that may require repair or reconstruction of the Property. 17. TITLE. Trustor warrants that Trustor lawfully has legal title to the Security without any limitation on the right to encumber. 18. GRANTING OF EASEMENTS. Trustor may not grant easements, licenses, rights -of -way or other rights or privileges in the nature of easements with respect to the Security except those reasonably required or desirable for installation and maintenance of utilities including water, gas, electricity, sewer, cable television, telephone, or telecommunications, those required by law and those otherwise necessary or desirable for the use or development of the Property, including the Permitted Encumbrances. 19. TAXES AND LEVIES. Trustor shall pay prior to delinquency, all taxes, fees, assessments, charges, liens and levies imposed by any public authority or utility company which are or may become a lien affecting the Security. However, Trustor shall not be required to pay any tax, assessment, charge or levy so long as (a) the legality thereof shall be promptly and actively contested in good faith and by appropriate proceedings, and (b) Trustor maintains reserves adequate to pay any contested liabilities. In the event that Trustor fails to pay any of the foregoing items and is not contesting such items in good faith, Beneficiary may, but shall be under no obligation to, pay the same, after Beneficiary has provided ten (10) days' written notice to Trustor of such failure to pay and Trustor fails to fully pay such items within the ten (10) day period after receipt of such notice. Any amount so advanced by Beneficiary, together with interest thereon from the date of such advance at the same rate of interest specified in the Note with the highest interest rate (unless payment of such an interest rate would be contrary to applicable law, in which case interest shall accrue at the highest rate then allowed by applicable law), shall become an additional obligation of Trustor to Beneficiary and shall be secured by this Deed of Trust. Beneficiary's payment of any tax, assessment or charge will not be deemed to waive any right Trustor may have to contest any relevant tax, assessment or charge. 20. INSURANCE. Trustor must provide such insurance as required under the Loan Agreement or Regulatory Agreement, or otherwise required under any Senior Lien (as defined herein), provided the rights of Beneficiary in the proceeds of any insurance shall be subject to the rights of any Senior Lender on the terms provided in any Subordination Agreement (as defined herein) or if not specified therein, in the 5 Regulatory Agreement. In the event Trustor fails to maintain the full insurance coverage required by this Deed of Trust, Beneficiary, after at least ten (10) days' prior written notice to Trustor, may, but shall be under no obligation to, take out the required policies of insurance and pay the premiums on such policies. Any amount so advanced by Beneficiary, together with interest thereon from the date of such advance at the same rate of interest specified in the Note with the highest interest rate (unless payment of such an interest rate would be contrary to applicable law, in which case interest shall accrue at the highest rate then allowed by applicable law), shall become an additional obligation of Trustor to Beneficiary and shall be secured by this Deed of Trust. 21. DAMAGES; INSURANCE AND CONDEMNATION PROCEEDS. (a) All judgments, awards of damages, settlements and compensation made in connection with or in lieu of taking any part of or interest in the Security under assertion of the power of eminent domain ("Funds") are hereby assigned to and shall be paid to Beneficiary. Beneficiary is authorized (but not required) to receive any Funds and is authorized to apply any such Funds to any indebtedness or obligation secured hereby, in such order and manner as Beneficiary determines. Any part of the Funds may be released to Trustor upon such conditions as Beneficiary may impose for its disposition. Application or release of any Funds shall not cure or waive any default under this Deed of Trust. The rights of Beneficiary under this paragraph are expressly subject to the rights of any Senior Lender in any such proceeds. (b) The following (whether now existing or hereafter arising) are all absolutely and irrevocably assigned by Trustor to Beneficiary and, at the request of Beneficiary, shall be paid directly to Beneficiary: (i) all awards of damages and all other compensation payable directly or indirectly by reason of a condemnation or proposed condemnation for public or private use affecting all or any part of, or any interest in, the Subject Property; (ii) all other claims and awards for damages to, or decrease in value of, all or any part of, or any interest in, the Subject Property; (iii) all proceeds of any insurance policies payable by reason of loss sustained to all or any part of the Subject Property; and (iv) all interest which may accrue on any of the foregoing. Subject to applicable law, and without regard to any requirement contained in Section 5.7(d), Beneficiary may at its discretion apply all or any of the proceeds it receives to its expenses in settling, prosecuting or defending any claim and may apply the balance to the Secured Obligations in any order, and/or Beneficiary may release all or any part of the proceeds to Trustor upon any conditions Beneficiary may impose. Beneficiary may commence, appear in, defend or prosecute any assigned claim or action and may adjust, compromise, settle and collect all claims and awards assigned to Beneficiary; provided, however, that if Beneficiary fails to pursue any such claim, Beneficiary shall assign or permit Trustor to pursue such claim upon Trustor's request, and in no event shall Beneficiary be responsible for any failure to collect any claim or award, regardless of the cause of the failure. (c) Beneficiary shall permit insurance or condemnation proceeds held by Beneficiary to be used for repair or restoration but may condition such application upon reasonable conditions, including, without limitation: (i) the deposit with Beneficiary of such additional funds which Beneficiary determines are needed to pay all cost of the repair or restoration, (including, without limitation, taxes, financing charges, insurance and rent during the repair period); (ii) the establishment of an arrangement for lien releases and disbursement of funds acceptable to Beneficiary; (iii) the delivery to Beneficiary of plans and specifications for the work, a contract for the work signed by a contractor acceptable to Beneficiary, a cost breakdown for the work and a payment and performance bond for the work, all of which shall be acceptable to Beneficiary; and (iv) the delivery to Beneficiary of evidence acceptable to Beneficiary (aa) that after completion of the work the income from the Subject Property will be sufficient to pay all expenses and debt service for 6 the Subject Property; (bb) of the continuation of Leases acceptable to and required by Beneficiary; (cc) that upon completion of the work, the size, capacity and total value of the Subject Property will be at least as great as it was before the damage or condemnation occurred, subject to City laws, ordinances, regulations and standards then in effect; (dd) that there has been no material adverse change in the financial condition or credit of Trustor since the date of this Deed of Trust; and (ee) the satisfaction of any additional conditions that Beneficiary may reasonably establish to protect its security. Trustor hereby acknowledges that the conditions described above are reasonable. 22. ACCELERATION ON TRANSFER OF SECURITY. In the event that Trustor, without the prior written consent of Beneficiary, sells, agrees to sell, transfers, or conveys its interest in the Security or any part thereof in violation of the Loan Agreement, Beneficiary may, at its option, declare all sums secured by this Deed of Trust to be immediately due and payable. 23. RECONVEYANCE BY TRUSTEE. This trust is intended to continue for the entire term of the Loan. Upon written request of Beneficiary stating that all sums secured by this Deed of Trust have been paid and upon surrender of this Deed of Trust to Trustee for cancellation and retention, and upon payment by Trustor of Trustee's reasonable fees, Trustee shall reconvey the Security to Trustor, or to the person or persons legally entitled thereto. DEFAULT AND REMEDIES 24. EVENTS OF DEFAULT. Any of the events listed in the Loan Agreement as an Event of Default shall also constitute an Event of Default under this Deed of Trust, including, but not limited to, (1) Trustor's failure to pay within ten (10) days after written notice of nonpayment by Beneficiary, any sums payable under this Deed of Trust, the Note, or the Loan Agreement, subject to any cure or grace period herein or therein; (2) Trustor's failure to observe or to perform any of its other covenants, agreements or obligations under this Deed of Trust, the Note, or the Loan Agreement; or (3) Trustor's failure to make any payment or perform any of its other covenants, agreements, or obligations under any Senior Lien (as defined herein) with respect to the Project or the Security, after expiration of any applicable notice and/or cure period provided in the relevant Senior Lien. Trustor shall have the full cure period provided in the Loan Agreement for defaults thereunder, to cure any default under this Deed of Trust. 25. RIGHTS OF OTHER LENDERS. Beneficiary shall provide concurrent notice of any default under this Deed of Trust to any lender having a lien secured by the Property of which Beneficiary has written notice, and such lender will have the longer of (a) any cure period provided in the Loan Documents or (b) thirty (30) days after the date of any such notice, to cure the relevant default. 26. ACCELERATION OF MATURITY. Upon the happening of an Event of Default which has not been cured within the times and in the manner provided in the Loan Agreement or in this Deed of Trust, Beneficiary may declare all sums advanced to Trustor under the Note and this Deed of Trust immediately due and payable. 27. BENEFICIARY'S REMEDIES. Upon the happening of an Event of Default which has not been cured within the times and in the manner provided in the Loan Agreement, Beneficiary may, in addition to other rights and remedies permitted by the Loan Agreement, the Note, or applicable law, and subject to the rights of any Senior Lender proceed with any of the following remedies: 7 A. Enforce the assignment of rents and right to possession as provided for in this Deed of Trust, and/or seek appointment of a receiver to take over possession of the Security and collect Rents; B. Enter the Security and take any actions necessary in its judgment to complete rehabilitation of the Security as permitted under the Loan Agreement and the assignment of rents and right to possession in this Deed of Trust, either in person or through a receiver appointed by a court; D. Commence an action to foreclose, judicially or nonjudicially, this Deed of Trust and/or seek appointment of a receiver from a court of competent jurisdiction with the authority to protect Beneficiary's interests in the Security, including the authority to complete construction of improvements; E. Deliver to Trustee a written declaration of Default and demand for sale, and a written Notice of Default and election to cause Trustor's interest in the Security to be sold, which notice Trustee or Beneficiary shall duly file for record in the official records of San Diego County, and exercise its power of sale as provided for below; or F. Pursue any other rights and remedies allowed at law or in equity. 28. FORECLOSURE BY POWER OF SALE. Should Beneficiary elect to foreclose by exercise of the power of sale contained in this Deed of Trust, Beneficiary shall notify Trustee. Upon receipt of such notice from Beneficiary, Trustee shall cause to be recorded, published and delivered to Trustor such Notice of Default and Election to Sell as then required by law and by this Deed of Trust. Trustee shall, without demand on Trustor, after lapse of such time as may then be required by law and after recordation of such Notice of Default and after Notice of Sale having been given as required by law, sell the Security, at the time and place of sale fixed by it in the Notice of Sale. The sale of the Security shall be as a whole or in separate lots or parcels or items as Trustee shall deem expedient and in such order as it may determine unless specified otherwise by Trustor, at public auction to the highest bidder for cash in lawful money of the United States payable at the time of sale. Trustee shall deliver to the purchaser its deed or deeds conveying the property so sold, but without any covenant or warranty, express or implied. The recitals in such deed of any matters of facts shall be conclusive proof of the truthfulness thereof. Any person, including, without limitation, Trustor, Trustee, or Beneficiary, may purchase at the sale. Trustee may postpone sale of the Security by public announcement at such time and place of sale, and from time to time may postpone the sale by public announcement at the time and place fixed by the preceding postponement, or may, in its discretion, give a new Notice of Sale. After deducting all reasonable costs and fees of Trustee, including costs of evidence of title in connection with such sale, Trustee shall apply the proceeds of sale as follows: (i) first, to payment of all sums then secured by this Deed of Trust, in such order and amounts as Beneficiary in its sole discretion determines, and (ii) the remainder, if any, to the person or persons legally entitled thereto. 29. REMEDIES CUMULATIVE. No right, power or remedy conferred upon Beneficiary by this Deed of Trust is intended to be exclusive of any other rights, powers or remedies, but each such right, power and remedy shall be cumulative and concurrent and shall be in addition to any other right, power and remedy given hereunder or existing at law or in equity. 8 GENERAL PROVISIONS 30. GOVERNING LAW. This Deed of Trust shall be interpreted under and governed by the laws of the State of California, except for those provisions relating to choice of law and those provisions preempted by federal law. 31. ATTORNEYS' FEES AND COSTS. In the event of any Event of Default, or any legal or administrative action is commenced to interpret or to enforce the terms of this Deed of Trust, the prevailing party in such action shall be entitled to recover all reasonable attorneys' fees and costs in such action. Any such amounts paid by Beneficiary shall be added to the indebtedness secured by the lien of this Deed of Trust. 32. STATEMENT OF OBLIGATION. Beneficiary may collect a reasonable fee not to exceed the maximum allowable under applicable law for furnishing a statement of obligations as provided in the California Civil Code. 33. NOTICES, DEMANDS AND COMMUNICATIONS. Formal notices, demands and communications between Trustor and Beneficiary shall be given as provided for in the Loan Agreement. 34. BINDING UPON SUCCESSORS. All provisions of this Deed of Trust shall be binding upon and inure to the benefit of the heirs, administrators, executors, successors -in -interest, transferees, and assigns of Trustor, Trustee, and Beneficiary. 35. WAIVER. Any waiver by Beneficiary of any obligation of Trustor in this Deed of Trust must be in writing. No waiver will be implied from any delay or failure by Beneficiary to take action on any breach or default of Trustor or to pursue any remedy allowed under the Deed of Trust or applicable law. Any extension of time granted to Trustor to perform any obligation under this Deed of Trust shall not operate as a waiver or release Trustor from any of its obligations under this Deed of Trust. Consent by Beneficiary to any act or omission by Trustor shall not be construed as a consent to any other or subsequent act or omission or to waive the requirement for Beneficiary's written consent to future waivers. 36. AMENDMENTS AND MODIFICATIONS. Any amendments or modifications to this Deed of Trust must be in writing, and shall be made only if mutually agreed upon by Beneficiary and Trustor. 37. LOAN AGREEMENT CONTROLS. If there is any contradiction between this instrument and the Loan Agreement, the terms of the Loan Agreement shall control, except that Trustor shall have no defense or claim that this instrument does not establish a valid lien on the Property or the Security. 38. DEFINITIONS. Capitalized terms not otherwise defined in this Deed of Trust shall have the same meaning as defined in the Loan Agreement. 39. PROOFS OF CLAIM. In the case of any receivership, insolvency, bankruptcy, reorganization, arrangement, adjustment, recomposition or other proceedings affecting Trustor, its creditors or its property, Trustee, to the extent permitted by law, shall be entitled to file such proofs of claim and other documents as may be necessary or advisable in order to have the claims of Beneficiary allowed in such proceedings and for any additional amount which may become due and payable by Trustor hereunder after such date. 9 40. SEVERABILITY. Every provision of this Deed of Trust is intended to be severable. If any term or provision of this Deed of Trust is declared to be illegal, invalid, or unenforceable by a court of competent jurisdiction, the legality, validity, and enforceability of the remaining provisions shall not be affected. If the lien of this Deed of Trust is invalid or unenforceable as to any part of the debt or the Security, the unsecured or partially secured portion of the debt and all payments made on the debt (whether voluntary or under foreclosure or other enforcement action or procedure) shall be considered to have been first applied to the payment of that portion of the debt which is not secured by the lien of this Deed of Trust. 41. SUBSTITUTION OF TRUSTEES. Beneficiary may from time to time appoint another trustee to act in the place of Trustee or any successor. Upon such appointment and without conveyance, the successor trustee shall be vested with all title, powers, and duties conferred upon Trustee. Each such appointment and substitution shall be made by a written instrument executed by Beneficiary containing reference to this Deed of Trust and its place of record, which when duly recorded in the San Diego County Office of the Recorder shall be conclusive proof of proper appointment of the successor trustee. 42. ACCEPTANCE BY TRUSTEE. Trustee accepts this Trust when this Deed of Trust, duly executed and acknowledged, is made public record as provided by law. Except as otherwise provided by law, Trustee is not obligated to notify any party hereto of pending sale under this Deed of Trust or of any action or proceeding in which Trustor, Beneficiary, or Trustee shall be a party unless brought by Trustee. IN WITNESS WHEREOF, Trustor has executed this Deed of Trust as of the day and year first above written. "TRUSTOR" VISTA DEL SOL APARTMENTS, L.P., a California limited partnership By: Vista Del Sol GP LLC, a California limited liability company, its general partner By: National Community Renaissance of California, a California nonprofit public benefit corporation, its manager By: Its: ICN t (lNI) 10 California All -Purpose Acknowledgment A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of San Bernardino S.S. On December 19, 2017 before me, Monica Rodriguez, Notary Public personally appeared Michael Finn who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand an official seal. ,f Notary Pubi'u.. Although the informal ,ris section is OPTIONAL INFORMATION MONICA RODRIGUEZ Notary Public - California L a San Bernardino County i z zCommission # 2194994 *'�,. M Comm. Expires Ma 26, 2021 it could prevent fraudulent removal and acknowledgment to an unauthorized document and may prove useful to persons relying on the attached document. Description of Attached Document The preceding Certificate of Acknowledgment is attached to a document titled/for the purpose of containing pages, and dated The signer(s) capacity or authority is/are as: ❑ Individual(s) ❑ Attorney -in -fact ❑ Corporate Officer(s) ❑ Guardian/Conservator ❑ Partner - Limited/General ❑ Trustee(s) ❑ Other representing: Jiu,cs; ofr ui(a)Gi-{ e Method of Signer Identification Proved to me on the basis of satisfactory evidence: ❑ form(s) of identification ❑ credible witness(es) Notarial event is detailed in notary journal on: Page # Entry # Notary contact: Other ❑ Additional Signer ❑ Signer(s)Thumbprints(s) A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of On before me, , Notary Public, personally appeared, who proved to me the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her their authorized capacity(ies), and that by his/her/their signature (s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under penalty of perjury under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature 11 EXHIBIT A PROPERTY DESCRIPTION (Vista Del Sol Apartments) (attached) 12 EXHIBIT "A" Legal Description of Real Property THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS: PARCEL 1: THE NORTHERLY 52.40 FEET OF THE SOUTHERLY 217.40 FEET OF THE WESTERLY HALF OF THE SOUTHERLY HALF OF THE WESTERLY HALF OF THE SOUTHWEST QUARTER OF QUARTER SECTION 129 OF RANCHO DE LA NACION, ACCORDING TO MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, MAY 11, 1869. EXCEPTING THEREFROM THE WESTERLY 185.00 FEET AND ALSO EXCEPTING THEREFROM THE EASTERLY 30.00 FEET. APN(s): 557-440-50 PARCEL 2: THE NORTHERLY 52.45 FEET OF THE SOUTHERLY 269.85 FEET OF THE WESTERLY ONE-HALF OF THE SOUTHERLY ONE-HALF OF THE WESTERLY ONE-HALF OF THE SOUTHWESTERLY QUARTER OF SECTION 129 OF RANCHO DE LA NACION, ACCORDING TO MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY. EXCEPTING THEREFROM THE WESTERLY 185.00 FEET; ALSO EXCEPTING THEREFROM THE EASTERLY 30.00 FEET. APN(s): 557-440-49 PARCEL 3: ALL OF THE WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWEST QUARTER OF QUARTER SECTION 129, RANCHO DE LA NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. EXCEPTING THEREFROM THE NORTH 273.00 FEET THEREOF. ALSO EXCEPTING THEREFROM THE SOUTH 323.85 FEET THEREOF. ALSO EXCEPTING THEREFROM THE WESTERLY 144.00 FEET THEREOF. ALSO EXCEPTING THEREFROM THE EASTERLY 30.00 FEET THEREOF. APN(s): 557-440-40 PARCEL 4: THE SOUTH 60.00 FEET OF THE NORTH 273.00 FEET OF THE WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWEST QUARTER OF QUARTER SECTION 129, RANCHO DE LA NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. EXCEPTING THEREFROM THE WEST 155.00 FEET. ALSO EXCEPTING THEREFROM THE EAST 30.00 FEET THEREOF. APN(s): 557-440-07 PARCEL 5: THE SOUTHERLY 65.00 FEET OF THE NORTHERLY 213.00 FEET OF THE WEST HALF OF THE SOUTH HALF OFTHE WEST HALF OF THE SOUTHWEST QUARTER OF QUARTER SECTION 129, RANCHO DE LA NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. EXCEPTING THEREFROM THE WEST 155.00 FEET. ALSO EXCEPTING THEREFROM THE EAST 30.00 FEET THEREOF. APN(s): 557-440-52 PARCEL 6: THE EASTERLY 150.00 FEET OF THE SOUTHERLY 58.00 FEET OF THE NORTHERLY 148.00 FEET OF THE WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWESTERLY QUARTER OF QUARTER SECTION 129, RANCHO DE LA NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, MAY 11, 1869. EXCEPTING THEREFROM THE EASTERLY 30.00 FEET. ALSO EXCEPTING THEREFROM THAT PORTION LYING WITHIN THE FOLLOWING DESCRIBED BOUNDARY: COMMENCING AT THE INTERSECTION OF THE NORTHERLY LINE OF THE WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWESTERLY QUARTER OF QUARTER SECTION 129 WITH THE WESTERLY LINE OF THE EASTERLY 30.00 FEET OF SAID WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWESTERLY QUARTER OF QUARTER SECTION 129; THENCE, ALONG SAID WESTERLY LINE SOUTH 18 44' 00" EAST, 9.80 FEET TO A POINT IN THE ARC OF A 50.00 FOOT RADIUS CURVE, THE CENTER OF WHICH BEARS SOUTH 55° 36' 12" EAST FROM SAID POINT AND BEING THE TRUE POINT OF BEGINNING; THENCE SOUTHWESTERLY, SOUTHERLY AND SOUTHEASTERLY ALONG THE ARC OF SAID CURVE THROUGH A CENTRAL ANGLE OF 97 32' 43" A DISTANCE OF 85.12 FEET TO THE BEGINNING OF A REVERSE 20.00 FOOT RADIUS CURVE; THENCE SOUTHEASTERLY ALONG THE ARC OF SAID CURVE THROUGH A CENTRAL ANGLE OF 44° 24' 55" A DISTANCE OF 15.50 FEET TO THE POINT OF TANGENCY IN THE WESTERLY LINE OF SAID EASTERLY 30.00 FEET; THENCE, ALONG SAID WESTERLY LINE NORTH 18 44' 00" WEST TO THE TRUE POINT OF BEGINNING. ALSO EXCEPTING THEREFROM THAT PORTION LYING WITHIN THE FOLLOWING DESCRIBED PROPERTY: BEGINNING AT THE NORTHWEST CORNER OF THE WEST HALF OF THE EAST HALF OF THE SOUTHWEST QUARTER OF THE WEST HALF OF LOT 2 OF SAID QUARTER SECTION 129 AS SHOWN ON THE MAP OF MILES MANOR NO. 1, ACCORDING TO THE MAP THEREOF NO. 5869 FILED IN THE OFFICE OF THE RECORDER OF SAID SAN DIEGO COUNTY, APRIL 21, 1967; THENCE, SOUTH 18° 44' 00" EAST ALONG THE EASTERLY LINE OF THE WEST HALF OF THE SOUTHWEST QUARTER OF THE WEST HALF OF SAID LOT 2, BEING ALSO THE CENTER LINE OF "Q" AVENUE AS SHOWN ON SAID MAP NO. 5869, A DISTANCE OF 108.99 FEET; THENCE, LEAVING SAID CENTER LINE AT RIGHT ANGLES SOUTH 71° 16' 00" WEST 30.00 FEET TO THE POINT OF TANGENCY OF A 20.00 FOOT RADIUS CURVE CONCAVE SOUTHWESTERLY, THE CENTER OF WHICH BEARS SOUTH 71° 16' 00" WEST, 20.00 FEET; THENCE, NORTHERLY ALONG THE ARC OF SAID 20.00 FOOT RADIUS CURVE THROUGH A CENTRAL ANGLE OF 44° 24' 55" A DISTANCE OF 15.50 FEET TO THE POINT OF TANGENCY WITH A REVERSE 50.00 FOOT RADIUS CURVE CONCAVE EASTERLY; THENCE, NORTHERLY ALONG THE ARC OF SAID 50.00 FOOT RADIUS CURVE THROUGH A CENTRAL ANGLE OF 97° 32' 43" A DISTANCE OF 85.12 FEET TO THE INTERSECTION WITH A LINE PARALLEL WITH AND 30.00 FEET WESTERLY AT RIGHT ANGLES TO SAID EASTERLY LINE OF THE WEST HALF OF THE SOUTHWEST QUARTER OF THE WEST HALF OF SAID LOT 2; THENCE, LEAVING SAID CURVE ALONG SAID PARALLEL LINE NORTH 18° 44' 00" WEST 19.87 FEET TO THE NORTHERLY LINE OF SAID SOUTHWEST QUARTER OF LOT 2; THENCE, NORTH 71° 02' 00" EAST ALONG SAID NORTHERLY LINE 30.00 FEET TO THE POINT OF BEGINNING. APN(s): 557-440-45 PARCEL 7: PARCEL B OF CERTIFICATE OF COMPLIANCE CASE FILE NO. 2008-39 CC, AS DISCLOSED IN THE GRANT DEED RECORDED SEPTEMBER 18, 2009 AS INSTRUMENT NO. 2009-0521138 OF OFFICIAL RECORDS, MORE PARTICULARLY DESCRIBED AS FOLLOWS: THE EASTERLY 90.00 FEET OF THE FOLLOWING DESCRIBED PARCEL OF LAND: THE NORTHERLY 30.00 FEET OF THE WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWEST ONE -QUARTER OF QUARTER SECTION 129, RANCHO DE LA NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY. EXCEPTING THEREFROM THE WESTERLY 30 FEET THEREOF AS DEEDED TO THE CITY OF NATIONAL CITY BY DEEDS RECORDED FEBRUARY 19, 1903 IN BOOK 325, PAGE 208 OF DEEDS AND JANUARY 5, 1928 IN BOOK 1388, PAGE 392 OF DEEDS. ALSO EXCEPTING THE EASTERLY 30.00 FEET THEREOF. AND ALSO EXCEPTING THAT PORTION LYING WITHIN THE FOLLOWING DESCRIBED BOUNDARY: COMMENCING AT THE INTERSECTION OF THE NORTHERLY LINE OF THE WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTH WESTERLY QUARTER OF QUARTER SECTION 129 WITH THE WESTERLY LINE OF THE EASTERLY 30.00 FEET OF SAID WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWESTERLY QUARTER OF QUARTER SECTION 129; THENCE ALONG SAID WESTERLY LINE SOUTH 18°44'00" EAST 9.80 FEET TO A POINT ON THE ARC OF A 50.00 FOOT RADIUS CURVE, THE CENTER OF WHICH BEARS SOUTH 55°36'12" EAST FROM SAID POINT AND BEING THE TRUE POINT OF BEGINNING; THENCE SOUTHWESTERLY, SOUTHERLY AND SOUTHEASTERLY ALONG THE ARC OF SAID CURVE, THROUGH A CENTRAL ANGLE OF 97°32'43" A DISTANCE OF 85.12 FEET TO THE BEGINNING OF A REVERSE 20.00 FOOT RADIUS CURVE; THENCE SOUTHEASTERLY ALONG THE ARC OF SAID CURVE, THROUGH A CENTRAL ANGLE OF 44°24'55" A DISTANCE OF 15.50 FEET TO THE POINT OF TANGENCY IN THE WESTERLY LINE NORTH 18°44'00"WEST TO THE TRUE POINT OF BEGINNING. TOGETHER WITH THE SOUTHERLY 60.00 FEET OF THE NORTHERLY 90.00 FEET OF THE WESTERLY HALF OF THE SOUTHERLY HALF OF THE WESTERLY HALF OF THE SOUTHWEST QUARTER OF QUARTER SECTION 129, OF RANCHO DE LA NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY; EXCEPTING THE WESTERLY 150.00 FEET THEREOF. ALSO EXCEPTING THE EASTERLY 30.00 FEET THEREOF. AND ALSO EXCEPTING THAT PORTION LYING WITHIN THE FOLLOWING DESCRIBED BOUNDARY: COMMENCING AT THE INTERSECTION OF THE NORTHERLY LINE OF THE WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWESTERLY QUARTER OF QUARTER SECTION 129 WITH THE WESTERLY LINE OF THE EASTERLY 30.00 FEET OF SAID WEST HALF OF THE SOUTH HALF OF THE WEST HALF OF THE SOUTHWESTERLY QUARTER OF QUARTER SECTION 129; THENCE, ALONG THE SAID WESTERLY LINE SOUTH 18° 44' 00" EAST 9.80 FEET TO A POINT ON THE ARC OF A 50.00 FOOT RADIUS CURVE, THE CENTER OF WHICH BEARS SOUTH 55° 36' 12" EAST FROM SAID POINT AND BEING THE TRUE POINT OF BEGINNING; THENCE, SOUTHWESTERLY, SOUTHERLY, AND SOUTHEASTERLY ALONG THE ARC OF SAID CURVE THROUGH A CENTRAL ANGLE OF 97° 32' 43" A DISTANCE OF 85.12 FEET TO THE BEGINNING OF A REVERSE 20.00 FOOT RADIUS CURVE; THENCE, SOUTHEASTERLY ALONG THE ARC OF SAID CURVE THROUGH A CENTRAL ANGLE OF 44° 24' 55" A DISTANCE OF 15.50 FEET TO THE POINT OF TANGENCY IN THE WESTERLY LINE OF SAID EASTERLY 30.00 FEET; THENCE, ALONG SAID WESTERLY LINE NORTH 18° 44' 00" WEST TO THE TRUE POINT OF BEGINNING. APN(s): 557-440-46; 557-440-61 PARCEL 8: LOTS 6 AND 7 OF MILES MANOR UNIT NO. 1, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 5869, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, APRIL 21, 1967. AN UNDIVIDED 1/2 INTEREST IN LOT 8 AND AN UNDIVIDED 1/2 INTEREST IN THE NORTH HALF OF LOT 3 OF SAID MILES MANOR UNIT NO. 1, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 5869, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, APRIL 21, 1967. APN(s): 557-440-33 AND 557-440-34 PARCEL 9: LOTS 4 AND 5 AND AN UNDIVIDED ONE -QUARTER INTEREST IN AND TO THE NORTH HALF OF LOT 3 AND AN UNDIVIDED ONE -QUARTER INTEREST IN AND TO LOT 8, ALL IN MILES MANOR UNIT NO. 1 IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 5869, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY ON APRIL 21, 1967. APN(s): 557-440-31, 557-440-32, AND 557-440-43 PARCEL 10: LOTS 1 AND 2 AND THE SOUTHEASTERLY HALF OF LOT 3 OF MILES MANOR UNIT NO. 1, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 5869, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, APRIL 21, 1967. APN(s): 557-440-44 PARCEL 11: PARCEL NO. 2 OF PARCEL MAP NO. 890, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, JULY 10, 1972, FILE NO. 177287, OF OFFICIAL RECORDS. APN(s): 557-440-53 PARCEL 12: PARCEL 1 OF PARCEL MAP 890, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY ON JULY 10, 1972, BEING A PORTION OF THE SOUTHWEST QUARTER OF QUARTER SECTION 129 OF RANCHO DE LA NACION IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 166 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. APN(s): 557-440-54 PARCEL 13: LOT 8 OF MILES MANOR UNIT NO. 1, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 5869, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, APRIL 21, 1967. APN(s): 557-440-35 PARCEL 15: THAT PORTION OF THE EASTERLY HALF OF THE EASTERLY HALF OF THE SOUTHWESTERLY QUARTER OF THE WESTERLY HALF OF LOT 2 IN QUARTER SECTION 129 OF RANCHO DE LA NACION, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 166, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY ON MAY 11, 1869, DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHEASTERLY CORNER OF THE SOUTHWESTERLY QUARTER OF THE WESTERLY HALF OF SAID LOT 2; THENCE SOUTHERLY ALONG THE EASTERLY LINE OF SAID SOUTHWESTERLY QUARTER OF THE WESTERLY HALF OF LOT 2, A DISTANCE OF 233.00 FEET; THENCE WESTERLY ALONG A LINE PARALLEL WITH THE NORTHERLY LINE OF SAID SOUTHWEST QUARTER, A DISTANCE OF 165.00 FEET ORE OR LESS TO THE WESTERLY LINE OF THE EASTERLY HALF OF THE EASTERLY HALF OF THE SOUTHWESTERLY QUARTER OF THE WESTERLY HALF OF SAID LOT 2 IN QUARTER SECTION 129; THENCE NORTHERLY ALONG SAID WESTERLY LINE OF THE SOUTHWESTERLY QUARTER OF LOT 2; THENCE EASTERLY ALONG SAID NORTHERLY LINE, A DISTANCE OF 165.00 FEET MORE OR LESS TO THE POINT OF BEGINNING. APN(s): 557-440-56