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2004 Centre Pointe - Declaration of Covenants, Conditions and Restrictions - CP Development, LLCt N cordino RequeSt Y Re �. � First American Title Company RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO:) La Quinta Redevelopment Agency 78-495 Calle Tampico La Quinta, California 92253 Attention: Executive Director Doc a 0004-0s7s 143 12/09/2004 08:00A Fee:NC Page 1 of 32 Recorded in Official Records County of Riverside Gary L. Orso Assessor, County Clerk & Recorder NIL, Wn I i III IL Ja EMEENMOMM2021 MWENWOMMMIFFAiVa MW (Space Above for Recorder's Use) (Exempt from Recordation Fee per Gov. Code § 27383) DECLARATION OF COVENANTS, CONDITIONS, T AND RESTRICTIONS FOR PROPERTY SG THIS DECLARATION OF COVENANTS, CONDITIONS, AND RESTRICTIONS FOR PROPERTY (the "Declaration") is made by and between CP DEVELOPMENT LA QUINTA, LLC, a California limited liability company (the "Covenantor") and the LA QUINTA REDEVELOPMENT AGENCY, a public body, corporate and politic (the "Agency" or "Covenantee") as of the Jd4-4 day of A& VA006e e , 2004. RECITALS A. Covenantor is the fee owner of record of that certain real property (the "Property") located in the City of La Quinta, County of Riverside, State of California, legally described in the attached Exhibit "A", which Property Covenantor acquired from Agency pursuant to a Grant Deed recorded concurrently herewith. B. This Declaration and the Grant Deed described in Recital A are part of a redevelopment project described in that certain Disposition and Development Agreement entered into by and between Covenantor and Covenantee on or about December 18, 2003, and amended on or about October 28, 2004 (the "DDA"). As described in the DDA, the Property includes not less than fifty-four (54) single family lots on each of which Covenantor shall construct a single family home, forty (40) of which single family homes shall be held for sale to "Eligible Buyers" (the "Affordable Housing Component") (as that term is defined in Section Lf hereof) (the "Project"). To assist Covenantor with the construction of the Affordable Housing Component, Covenantee has agreed to provide financial assistance to Covenantor, in the form of a loan (the "Covenantee Loan"). Repayment of the Covenantee Loan will be secured by a promissory note (the "Note") and a deed of trust (the "Deed of Trust"). The DDA provides that at the close of escrow for Covenantor's sale of one of the "Affordable Homes" (as that term is defined in Section Lb hereof) to an Eligible Buyer, Covenantor may transfer a portion of the Covenantee Loan to such Eligible Buyer, in the form of downpayment assistance provided from the Covenantor to the Eligible Buyer, and the outstanding balance due from Covenantor to Covenantee under the Note and the Deed of Trust will automatically be reduced by a like amount, all as further described in the DDA. 882/015610-0061 555941.02 al1/09/04 C. The Property is within the La Quinta Redevelopment Project No. 2 (the "Project Area") in the City of La Quinta and is subject to the provisions of the Redevelopment Plan for the Project Area (the "Redevelopment Plan"). D. The Community Redevelopment Law (California Health and Safety Code 33000 et seq.) provides that a redevelopment agency shall establish covenants running with the land in furtherance of redevelopment plans. NOW, THEREFORE, THE COVENANTEE AND THE COVENANTOR AGREE AS FOLLOWS: 1. Definitions. a. "Affordability Period" for each Affordable Home shall be forty-five (45) years from the date said Affordable Home is transferred to an Eligible Buyer, as evidenced by the recordation of a Buyer Affordable Housing Agreement by said Eligible Buyer. b. "Affordable Homes" shall mean the forty (40) single family homes in the Project that are restricted for sale to Eligible Buyers. Any individual such home shall be referred to as an "Affordable Home." Each of the Affordable Homes shall be subject to the restrictions of this Declaration. C. "Affordable Housing Cost" shall be that purchase price which would result in monthly housing payments, including the cost for a thirty (30) year mortgage for that portion of the purchase price which is to be paid in the form of loan proceeds under currently prevailing mortgage loan rates or the interest rate of any below -market mortgage program for which such purchaser has obtained a first trust deed loan, of (i) for households which earn not more than one hundred ten percent (110%) of Riverside County median income, not less than twenty-eight percent (28%) of the gross income of the household, nor more than thirty-five percent (35%) of one hundred ten percent (110%) of Riverside County median income adjusted for family size appropriate for the Affordable Home, or (ii) if the gross income of the household exceeds one hundred ten percent (110%) of Riverside County median income, not more than thirty-five percent (35%) of the actual gross income of the household. A sample calculation of an Affordable Housing Cost for the Affordable Homes is set forth on Exhibit `B", which is attached hereto and incorporated herein by this reference ("Calculation of Affordable Housing Costs"). d. "Buyer Affordable Housing Documents" shall collectively refer to the following documents, all of which shall be required to be executed by each buyer of an Affordable Home to assure the affordability of the Affordable Home to Eligible Buyers: (i) an affordable housing agreement that prohibits the resale of the Affordable Home except to an Eligible Buyer and grants the Covenantee an option to purchase the Affordable Home ("Option to Purchase") in the event the buyer is unable to locate an Eligible Buyer ("Buyer Affordable Housing Agreement"); (ii) a Memorandum reciting Covenantee's Option to Purchase ("Buyer Memorandum re Option to Purchase"); (iii) a promissory note ("Buyer Promissory Note") whose terms shall include a second deed of trust securing the Buyer Promissory Note ("Buyer Second Trust Deed"); and (iv) a disclosure statement acknowledging and consenting to all of the 8821015610-0061 555941.02 a11/09/04 2 affordability restrictions contained in the aforementioned documents ("Buyer Disclosure Statement"). e. "Covenantor" shall mean Covenantor and any successor in interest of Covenantor to the Site or any portion thereof. f. "Eligible Buyer" shall mean a buyer of one of the Affordable Homes in the Project who qualifies as a "person or family of moderate income" within the meaning of California Health and Safety Code Section 50093 (i.e., households whose household income, adjusted for family size, do not exceed one hundred twenty percent (120%) of the Riverside County Median Income). g. "Owner" shall mean an Eligible Buyer to whom Covenantor has conveyed fee title to one of the Affordable Homes or any successor in interest to said Eligible Buyer to all or any portion of the Affordable Home. h. "Proposed Buyer" shall mean a person or family determined to be an Eligible Buyer, to whom the Covenantor or any successor Owner desires and proposes to Transfer an Affordable Home. i. "Purchase Housing Cost" for an Eligible Buyer purchasing an Affordable Home shall be a cost that includes all of the following associated with that Affordable Home, estimated or known as of the date of the proposed sale of the Affordable Home: (1) Principal and interest on a fixed rate mortgage loan including any rehabilitation loans, and any loan insurance fees associated therewith. (2) Property taxes and assessments. (3) Fire and casualty insurance covering replacement value of property improvements. (4) Any homeowner association fees. (5) Estimate of utilities cost. (6) Estimate of property maintenance costs. The sum of (1) through (6), inclusive, shall not exceed the Affordable Housing Cost. j. "Sales Price" shall mean all sums paid by an Eligible Buyer to Covenantor for, or in conjunction with, the acquisition of an Affordable Home, including the purchase price designated in any purchase agreement, consideration for personal property and all other costs and fees paid by the Eligible Buyer to or for the benefit of the Covenantor. k. "Transfer" shall mean (i) any sale, assignment, or transfer of an interest in an Affordable Home, including, without limitation, a fee simple interest, tenancy in common, 882/015610-0061 555941.02 a11/09/04 3 joint tenancy, community property, tenancy by the entireties, life estate, or other limited estate, leasehold interest or any rental of the Affordable Home, or (ii) any interest evidenced by a land contract. 1. "Unrestricted Homes" shall mean the fourteen (14) single-family homes in the Project that are not restricted for sale to Eligible Buyers. Each individual such home shall be referred to as an "Unrestricted Home." Notwithstanding the foregoing, this Declaration shall be subordinate to the lien of a first deed of trust against the Property, and shall not impair the rights of any institution or lender which is the maker of a loan secured by such first deed of trust, or such lender's assignee or successor in interest, to exercise its remedies under the deed of trust in the event of default under the first deed of trust by the Covenantor. Such remedies under the first deed of trust include the right of foreclosure or acceptance of a deed or assignment in lieu of foreclosure. After such foreclosure or acceptance of a deed in lieu of foreclosure, the affordability covenants and the transfer restrictions set forth in Sections 1, 2, 3 and 7 of this Declaration as to each lot covered by this Declaration that is the subject to the foreclosure, shall be forever terminated and shall have no further effect as to the Property or any transferee thereafter; provided, however, if the holder of such deed of trust acquired title to the Property pursuant to a deed or assignment in lieu of foreclosure, said Sections 1, 2, 3 and 7 of this Declaration shall automatically terminate upon such acquisition of title, provided that (i) the Covenantee has been given written notice of a default under such first deed of trust; and (ii) the Covenantee shall not have cured the default under such first deed of trust within the thirty (30) day period provided in such notice sent to the Covenantee. Notwithstanding any other provision hereof, the nondiscrimination covenants and the maintenance requirements set forth in this Declaration shall remain in full force and effect as to the Property and any transferee. 2. Sale of Affordable Homes. Covenantor agrees that Covenantor shall sell each Affordable Home to an Eligible Buyer at an Affordable Housing Cost and that during the Affordability Period for such Affordable Home each subsequent resale thereof by the then -Owner shall be to an Eligible Buyer at an Affordable Housing Cost. Covenantor agrees that this Declaration shall be recorded against the Property concurrently with the close of escrow pursuant to which Covenantor acquired fee title to the Property. Covenantor agrees to commence to market each Affordable Home not later than the completion of construction of said Affordable Home and agrees to sell the Affordable Homes on a proportionate basis with the Unrestricted Homes. For example, Covenantor agrees to sell two (2) Affordable Homes prior to selling each Unrestricted Home. Escrow for the Transfer of an Unrestricted Home by Covenantor to a purchaser shall not close until after escrow closes for the Transfer of two (2) of the Affordable Homes. In the event Covenantor sells all of the homes in the Project, but does not sell all forty (40) of the Affordable Homes to Eligible Buyers, then within thirty (30) days after the close of escrow for the last home sold (whether such home is an Affordable Home or an Unrestricted Home), Covenantor shall be required to (i) repay to Covenantee the then -outstanding balance owed under the Note, in accordance with the terms thereunder, and, to the extent permitted by law, (ii) pay to Covenantee the sum of One Hundred Fifty Thousand Dollars ($150,000) for each 982/015610-0061 555941.02 a11/09/04 -4- Affordable Home that was sold to a buyer who does not qualify as an Eligible Buyer (the "Damage Amount"); provided, however, that nothing herein shall be deemed to limit Covenatee's remedy for a violation under this Section 2 to seeking monetary damages, and Covenantee shall be entitled to pursue any other equitable remedy permitted by law, including specific performance or injunctive relief, to prevent such a violation. For example, if Covenantor sells 20 of the homes in the Project as Unrestricted Homes, and 34 of the homes in the Project as Affordable Homes, then Covenantor shall pay to Covenantee, in addition to all amounts then -outstanding under the Note, the sum of $900,000 [(40 — 34) x $150,000]. THE PARTIES HERETO AGREE THAT THE DAMAGE AMOUNT CONSTITUTES A REASONABLE APPROXIMATION OF THE ACTUAL DAMAGES THAT COVENANTEE WOULD SUFFER DUE TO THE DEFAULTS BY COVENANTOR SET FORTH IN THIS SECTION 2, CONSIDERING ALL OF THE CIRCUMSTANCES EXISTING ON THE EXECUTION DATE HEREOF, INCLUDING THE RELATIONSHIP OF THE DAMAGE AMOUNT TO THE RANGE OF HARM TO COVENANTEE AND ACCOMPLISHMENT OF COVENANTEE' S PURPOSE OF ASSISTING IN THE PROVISION OF AFFORDABLE HOUSING TO ELIGIBLE BUYERS THAT REASONABLY COULD BE ANTICIPATED AND THE ANTICIPATION THAT PROOF OF ACTUAL DAMAGES WOULD BE COSTLY OR INCONVENIENT. THE DAMAGE AMOUNT SET FORTH IN THIS SECTION 2 SHALL BE THE SOLE DAMAGES REMEDIES FOR THE DEFAULTS SET FORTH IN THIS SECTION 2, BUT NOTHING IN THIS SECTION 2 SHALL BE INTERPRETED TO LIMIT COVENANTEE' S REMEDY FOR SUCH DEFAULT TO SUCH A DAMAGES REMEDY. IN PLACING ITS INITIAL AT THE PLACES PROVIDED HEREINBELOW, EACH PARTY SPECIFICALLY CONFIRMS THE ACCURACY OF THE STATEMENTS MADE ABOVE AND THE FACT THAT EACH PARTY HAS BEEN REPRESENTED BY COUNSEL OR HAS HAD THE OPPORTUNITY TO BE REPRESENTED BY COUNSEL TO EXPLAIN THE CONSEQUENCES OF THE LIQUIDATED DAMAGES PROVISION AT OR PRIOR TO THE TIME EACH EXECUTED THIS AGREEMENT. kt- COVENANTEE'S INITIALS: COVENANTOR'S INITIALS. Notwithstanding any of the above, nothing herein is intended to preclude the Covenantee's recovery of its attorney's fees and costs incurred to enforce this Section, as provided in Section 14. For purposes of satisfying the requirement that all of the Affordable Homes shall be occupied by Eligible Buyers: (a) an individual or family who qualifies as an Eligible Buyer at the time he or she first takes title to an Affordable Home will be deemed an Eligible Buyer as long as he or she continues to hold title to such Affordable Home even though the Eligible Buyer subsequently ceases to meet the income requirements of an Eligible Buyer, and (b) when an Owner releases title to an Affordable Home, such home will be considered as occupied by an Eligible Buyer if it is held vacant and available for such occupancy until title is transferred to another Eligible Buyer. 882/015610-0061 555941.02 a] 1/09/04 5 3. Restrictions on Transfer by Sale of the Propelly or Any Affordable Home. a. For the duration of the Affordability Period, Covenantor, for itself and any subsequent Owner of an Affordable Home, hereby subjects the Property to certain restrictions and limits the price at which Covenantor or any Owner of an Affordable Home may sell and/or resell said Affordable Home and the persons to whom Covenantor or any Owner of an Affordable Home may sell said Affordable Home. b. COVENANTOR UNDERSTANDS THAT THE DETERMINATION OF THE SALES PRICE FOR THE AFFORDABLE HOMES CAN BE MADE ONLY AT THE TIME OF THE PROPOSED TRANSFER, TAKING INTO CONSIDERATION INTEREST RATES, PROPERTY TAXES AND OTHER FACTORS THAT CANNOT BE ACCURATELY PREDICTED AND THAT THE SALES PRICE PERMITTED HEREUNDER FOR THE AFFORDABLE HOMES MAY NOT INCREASE OR DECREASE IN THE SAME MANNER AS OTHER SIMILAR REAL PROPERTY WHICH IS NOT ENCUMBERED BY THIS RESTRICTION. COVENANTOR FURTHER ACKNOWLEDGES THAT IN SETTING THE SALES PRICE FOR THE AFFORDABLE HOMES, THE PRIMARY OBJECTIVE OF THE COVENANTEE AND THIS DECLARATION IS TO PROVIDE HOUSING TO ELIGIBLE BUYERS AT AN AFFORDABLE HOUSING COST. THE SALES PRICE MAY BE LESS THAN OTHER SIMILAR PROPERTIES WHICH HAVE NO RESTRICTIONS. Covenantor's Initials C. Transfer of an Affordable Home. Covenantor may Transfer an Affordable Home only in strict accordance with the provisions of this Declaration. Specifically, during the Affordability Period, Covenantor may transfer an Affordable Home (i) only to an Eligible Buyer whose assets immediately prior to the close of escrow for the Affordable Home do not exceed the limits set forth in the Asset Limitation Requirements set forth in the La Quinta Housing Program Implementation Manual, (ii) only if the Purchase Housing Cost does not exceed the Affordable Housing Cost for the Eligible Buyer; and (iii) only if the Transfer has previously been approved in writing by the Covenantee. In order to comply with this Subsection 3(c), Covenantor must calculate the Affordable Housing Cost for the Proposed Buyer of the Affordable Home in accordance with the definition set forth in Section 1(c) of this Declaration. The Covenantor should contact the Covenantee housing staff to obtain assistance in determining this calculation. After calculating the Affordable Housing Cost for the Proposed Buyer, the Covenantor must ensure that the sum of the Sales Price and all costs listed in the definition of Purchase Housing Cost set forth in Section l (i) of this Declaration does not exceed an Affordable Housing Cost. The calculation of the Sales Price under this Section 3(c) is illustrated by example in the Calculation of Affordable Housing Cost. d. Notwithstanding anything to the contrary in this Section 3, at close of the escrow pursuant to which the Covenantor shall transfer an Affordable Home to an Eligible 882/015610-0061 555941.02 al1/09/04 -6- Buyer, the Eligible Buyer shall execute a complete set of Buyer Affordable Housing Documents as described in Section 1(d) hereof. e. The foregoing provisions will apply to every successive Transfer during the Affordability Period except that the then -Owner shall be responsible for complying with the requirements of the Covenantor as set forth in this Section 3. 4. Process to Complete Transfer by Sale of Affordable Homes. Prior to the Transfer by sale of an Affordable Home, Covenantor shall do all of the following: a. Notice to Covenantee: Covenantor shall send to the Covenantee in care of the La Quinta Housing Department (or its successor), at P.O. Box 1504, La Quinta, California 92253, the form attached hereto and incorporated herein as Exhibit "C" ("Request for Approval of Proposed Buyer") fully completed and executed by the Covenantor and the Proposed Buyer. b. Qualification of Proposed Buyer. No Transfer shall occur unless and until determination is made based on the Request for Approval of Proposed Buyer that the Proposed Buyer (i) intends to occupy the Affordable Home as the Proposed Buyer's principal residence and (ii) is an Eligible Buyer whose assets at the close of escrow for the Affordable Home do not exceed the limits set forth in the Asset Limitation Requirements, which are attached to the La Quinta Housing Program Implementation Manual as Attachment 1. Each Request for Approval of Proposed Buyer shall include a statement by the Proposed Buyer certifying its intent with regard to the occupancy of the Affordable Home and as to the truth and accuracy of all information supplied as to the Gross Income (calculated as set forth in 25 Cal. Code of Regs., Section 6914) of the Proposed Buyer. Covenantor shall certify pursuant to the Request for Approval of Proposed Buyer the information provided on said request form. Covenantor shall be entitled to rely on the information on the Request for Approval of Proposed Buyer and attachments thereto in making the determination required by this subsection 4(b) unless the Covenantor has knowledge of, or a reasonable basis for belief as to the inaccuracy or falsehood of the Request for Approval of Proposed Buyer. C. Affordable Home Sales Price. The Sales Price for the Affordable Home shall not exceed the maximum price at which the Purchase Housing Cost to be paid by the Proposed Buyer would not exceed the Affordable Housing Cost. The calculation of the Sales Price under this subsection is illustrated by the Calculation of Affordable Housing Cost. However, in determining the Affordable Housing Cost, the family size of the Proposed Buyer shall be deemed to be 1 person in the case of a studio Affordable Home, 2 persons in the case of a 1 bedroom Affordable Home, 3 persons for a 2 bedroom Affordable Home, 4 persons for a 3 bedroom Affordable Home, or 5 persons for a 4 bedroom Affordable Home. If the actual family size of the Proposed Buyer is larger, then the actual family size shall be used. d. Certificates from Covenantor and Proposed Buyer. With respect to each initial sale of an Affordable Home, Covenantor shall submit to the Covenantee, not later than four (4) weeks prior to close of escrow on the sale of the Affordable Home, a certificate that (i) the Covenantor has made the affirmative determinations required by Section 4(b) above and (ii) 882/015610-0061 555941.02 al1/09/04 7 the Sales Price conforms with Section 4(c) above. The Covenantor shall concurrently submit to the Covenantee the Request for Approval of Proposed Buyer and all attachments thereto and all other documents or material with regard to information required by Section 4(a) and/or (b) above, whether or not relied on by the Covenantor. Further, the Covenantor and Proposed Buyer each shall certify in writing, in a form acceptable to the Covenantee, that the Transfer shall be closed in accordance with, and only with, the terms of the sales contract and other documents submitted to and approved by the Covenantee and that all consideration delivered by the Proposed Buyer to Covenantor has been fully disclosed to the Covenantee. The written certificate shall also include a provision that, in the event a Transfer is made in violation of the terms of this Declaration or false or misleading statements are made in any documents or certificate submitted to the Covenantee for its approval of the Transfer, the Covenantee shall have the right to file an action at law or in equity to seek termination and/or rescission of the sales contract and/or declare the sale void, notwithstanding the fact that the Transfer may have closed and become final as between Covenantor and its Proposed Buyer. In the event Covenantor fails to comply with Sections 4(a) or 4(b) above, any costs, liabilities or obligations incurred by the Covenantor and its Proposed Buyer for the return of any monies paid or received or for any costs and legal expenses, shall be borne jointly and severally by the Covenantor and its Proposed Buyer and such parties shall hold the City of La Quinta ("City") and Covenantee harmless and reimburse their expenses, legal fees and costs for any action and City and/or Covenantee take in enforcing the terms of this Section 4(d). e. Execution of Buyer Affordable Housing Documents. Notwithstanding anything to the contrary in this Agreement, at close of escrow of the sale of the Affordable Home from the Covenantor to an Eligible Buyer, the Eligible Buyer shall execute a complete set of Buyer Affordable Housing Documents. The Buyer Affordable Housing Documents require, among other things, that during the Affordability Period for said Affordable Home, (i) the Affordable Home must be owner -occupied at all times and cannot be rented or leased; (ii) the Affordable Home may only be Transferred at an Affordable Housing Cost to an Eligible Buyer; and (iii) the maximum permitted sales price for the Affordable Home may be less than fair market value. f. Delivery of Documents. Upon the close of the proposed Transfer, the Covenantor shall provide the Covenantee with a certified copy of the recorded documents, a copy of the final sales contract, settlement statement, escrow instructions, all certificates required by this Section 4 and any other documents which the Covenantee may request. COVENANTOR UNDERSTANDS THAT THE DETERMINATION. OF THE AFFORDABLE HOUSING COST CAN BE MADE ONLY AT THE TIME OF THE PROPOSED TRANSFER, TAKING INTO CONSIDERATION INTEREST RATES, THE TERMS OF SALE OFFERED TO AND THE ECONOMIC CIRCUMSTANCES OF THE PROPOSED BUYER AND OTHER FACTORS THAT CANNOT BE ACCURATELY PREDICTED, AND THAT THE TRANSFER PRICE PERMITTED HEREUNDER MAY BE LESS THAN THE FAIR MARKET VALUE OF THE AFFORDABLE HOME AND MAY NOT INCREASE OR DECREASE IN THE SAME MANNER AS OTHER SIMILAR REAL PROPERTY WHICH IS NOT ENCUMBERED BY THIS RESTRICTION. COVENANTOR FURTHER ACKNOWLEDGES THAT IN SETTING THE TRANSFER PRICE THE 882/015610-0061 555941.02 al1/09/04 -8- PRIMARY OBJECTIVE OF THE COVENANTEE AND THIS DECLARATION IS TO PROVIDE HOUSING TO ELIGIBLE BUYERS AT AN AFFORDABLE HOUSING COST. The covenant contained in this Section 4 Affordable Home, shall automatically terminate an Expiration Date set forth in Section 12 hereof 5. Nondiscrimination Covenants d shall run with the land and, as to each be of no further force or effect upon the Covenantor by and for itself, its successors and assigns, and all persons claiming under or through them that there shall be no discrimination against or segregation of any person or group of persons on account of race, color, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the Property, nor shall Covenantor itself, or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees, or vendees in the Property. Covenantor, and its successors and assigns, shall refrain from restricting the rental or lease (if permitted by Covenantee) or sale of the Property on the basis of race, color, religion, sex, marital status, national origin or ancestry of any person. All such deeds, leases, or contracts shall contain or be subject to substantially the following nondiscrimination or nonsegregation clauses: a. In deeds: "The grantee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the grantee himself or herself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the land herein conveyed. The foregoing covenants shall run with the land." b. In leases: "The lessee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through him or her, and this lease is made and accepted upon and subject to the following conditions: "There shall be no discrimination against or segregation of any person or group of persons on account of race, color, religion, sex, marital status, ancestry or national origin in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the premises herein leased nor shall the lessee himself or herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, sublessees, subtenants or vendees in the premises herein leased." C. In contracts: "There shall be no discrimination against or segregation of, any person, or group of persons on account of race, color, religion, sex, marital status, ancestry or national origin in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the 882/015610-0061 555941.02 a]1/09/04 9 premises, nor shall the transferee himself of herself, or any person claiming under or through him -or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, sublessees or vendees of the premises." Nothing in this Section 5 shall be construed to authorize the rental or lease of the Property if such rental or lease is not otherwise permitted. The covenants in this paragraph 5 shall run with the land in perpetuity. 6. Maintenance of Property Covenantor shall properly maintain the buildings, landscaping and yard areas on the Property as follows: a. No improperly maintained landscaping shall be visible from public rights - of -way, including: (1) no lawns with grasses in excess of six (6) inches in height; (2) no untrimmed hedges; (3) no trees, shrubbery, lawns, and other plant life dying from lack of water or other necessary maintenance; and (4) no trees and shrubbery grown uncontrolled without proper pruning; (5) no vegetation so overgrown as to be likely to harbor rats or vermin; (6) no dead, decayed, or diseased trees, weeds, and other vegetation. b. No yard areas shall be left unmaintained, including: (1) no broken or discarded furniture, appliances, and other household equipment stored in yard areas for periods exceeding one (1) week; (2) no packing boxes, lumber, trash, dirt, and other debris stored in yards for periods exceeding one (1) week in areas visible from public property or neighboring properties; (3) no unscreened trash cans, bins, or containers stored for unreasonable periods in areas visible from public property or neighboring properties; and areas. (4) no vehicles parked or stored in areas other than approved parking C. No buildings may be left in an unmaintained condition, including: (1) no violations of state law, Uniform Codes, or City ordinances; 882/015610-0061 _ 1 O- 555941.02 a11/09/04 (2) no condition that constitutes an unsightly appearance that detracts from the aesthetics or property value of the subject property or constitutes a private or public nuisance; (3) no broken windows or chipped, cracked, or peeling paint; and (4) no conditions constituting hazards and/or inviting trespassers or malicious mischief; and (5) no graffiti. 7. Covenantee's Right of Reverter Covenantee shall have the additional right, at its option, to reenter and take possession of the Property, or portion thereof, with all improvements thereon and revest in the Covenantee the estate theretofore conveyed to the Covenantor, if after conveyance of title to the Property and prior to issuance of the Certificate of Completion for the lot or lots in question, the Covenantor shall: a. Fail to proceed with the construction of the Project as required by the DDA (subject to any force majeure delays) for a period of ninety (90) days after written notice of such abandonment or suspension from the Covenantee subject to any force majeure delays under Section 702 of the DDA; or b. Abandon or substantially suspend construction of the improvements for a period of ninety (90) days (subject to any force majeure delays) after written notice of such abandonment or suspension from the Covenantee; or C. Transfer or suffer any involuntary transfer of the Property or any part thereof in violation of the DDA. Such right to reenter, repossess and revest to the extent provided in this Declaration shall be subordinate and subject to and be limited by and shall not defeat, render invalid or limit: (1) Any mortgage, deed of trust or other security instrument permitted by the DDA; or (2) Any rights or interest provided in the DDA for the protection of the holder of such mortgages, deeds of trust or other security instruments. Upon the revesting in the Covenantee of title to the Property or any part thereof as provided in this Section 7, the Covenantee shall, pursuant to its responsibilities under state law, use its best efforts to resell the Property or part thereof as soon and in such manner as the Covenantee shall find feasible and consistent with the objectives of such law and of the Redevelopment Plan to a qualified and responsible party or parties (as determined by the Covenantee) who will assume the obligation of making or completing the improvements, or such other improvements in their stead, as shall be satisfactory to the Covenantee and in accordance 882/015610-0061 555941.02 al 1/09/04 -11- with the uses specified for the Property or part thereof in the Redevelopment Plan. Upon such resale of the Property, the proceeds thereof shall be applied: (i) First, to reimburse the Covenantee on its own behalf or on behalf of the City for all costs and expenses incurred by the Covenantee (excluding salaries to personnel and other items of overhead of the Covenantee or the City) in connection with the recapture, management and resale of the Property or part thereof (but less any income derived by the Covenantee from the Property or part thereof in connection with such management); all taxes, assessments and water and sewer charges with respect to the Property or part thereof (or, in the event the Property is exempt from taxation or assessment or such charges during the period of ownership, then such taxes, assessments or charges as determined by the County of Riverside assessing official as would have been payable if the Property were not so exempt); any payments made or necessary to be made to discharge or prevent from attaching or being made any subsequent encumbrances or liens due to obligations, defaults or acts of the Covenantor; any expenditures made or obligations incurred with respect to the making or completion of the improvements or any part thereof on the Property or part thereof; and any amounts otherwise owing the Covenantee by the Covenantor; and (ii) Second, to reimburse the Covenantor up to the amount equal to the sum of: (a) the Purchase Price paid to the Covenantee by the Covenantor for the Property (or allocable to the part thereof); plus (b) the costs and expenses incurred by the Covenantor for the development of the Property and for construction of the improvements existing on the Property at the time of the reentry and repossession; less (c) any gains or income withdrawn or made by the Covenantor from the Property or the improvements thereon. Any balance remaining after such reimbursements shall be retained by the Covenantee as its property. To the extent that the rights established in this Section 7 involve a forfeiture, it must be strictly interpreted against the Covenantee, the party for whose benefit it is created. The rights established in this Section 7 are to be interpreted in light of the fact that the Covenantee will convey the Property to the Covenantor for development and not for speculation. 8. Covenants Do Not Impair Liens. No violation or breach of covenants, conditions, restrictions, provisions, or limitations contained in this Declaration shall defeat or render invalid or in any way impair the lien or charge of any mortgage or deed of trust or security instrument. 9. Conflict with Other Laws; Severability. In the event that any provision of this Declaration is found to be contrary to applicable law, then the contrary provisions of this Declaration shall be deemed to mean those provisions which are enforceable and consistent with such laws and policies. The remaining portions of this Declaration shall be deemed modified in a manner which is consistent with the goals and intent of this Declaration to provide housing at an Affordable Housing Cost to Eligible Buyers. 882/015610-0061 -12- 555941.02 a11/09/04 Every provision of this Declaration is intended to be severable. In the event any term or provision of this Declaration is declared by a court of competent jurisdiction to be unlawful, invalid or unenforceable for any reason, such determination shall not affect the balance of the terms and provisions of this Declaration, which terms and provisions shall remain binding and enforceable. 10. Covenants for Benefit of City and Covenantee. All covenants without regard to technical classification or designation shall be binding for the benefit of the Covenantee and the City and such covenants shall run in favor of the Covenantee and the City for the entire period during which such covenants shall be in force and effect, without regard to whether the Covenantee or the City is or remains an owner of any land or interest therein to which such covenants relate. The Covenantee and the City, in the event of any breach of any such covenants, shall have the right to exercise all the rights and remedies and to maintain any actions at law or suits in equity or other proper legal proceedings to enforce and to cure such breach to which it or any other beneficiaries of these covenants may be entitled during the term specified for such covenants, except the covenants against discrimination which may be enforced at law or in equity at any time in perpetuity. 11. Notices, Demands and Communications. Written notices, demands and communications between the Covenantor and the Covenantee shall be sufficiently given if (i) delivered by hand, (ii) delivered by reputable same - day or overnight courier service that provides a receipt showing date and time delivery, or (iii) dispatched by registered or certified mail, postage prepaid, return receipt requested, as follows: Covenantor: CP Development La Quinta, LLC 77-900 Avenue of the States Palm Desert, CA 92611 Attn: Richard Oliphant copy to: Selzer, Ealy, Hemphill & Blasdel, LLP 777 Tahquitz Canyon Way, Suite 328 Palm Springs, CA 92262 Attn: Emily Perri Hemphill and Genesis Hotel Development LLC 76890 Sandpiper Drive Indian Wells, CA 92210 Attn: Francis A. Wong Covenantee: La Quinta Redevelopment Agency Attention: Executive Director 78-495 Calle Tampico La Quinta, CA 92253 882/015610-0061 555941.02 al1/09/04 -13- copy to: Rutan & Tucker, LLP 611 Anton Blvd., Suite 1400 Costa Mesa, CA 92626 Attn: M. Katherine Jenson, Esq. Such addresses for notice may be changed from time to time upon notice to the other party. Any written notice, demand or communication shall be deemed received immediately if delivered by hand or by reputable delivery service that provides a receipt with date and time of delivery and shall be deemed received on the third (3rd) calendar day from the date it is postmarked if delivered by registered or certified mail, postage prepaid, return receipt requested. 12. Expiration Date. This Declaration shall automatically terminate and be of no further force or effect as to each Affordable Home as of the termination of the Affordability Period for said Affordable Home, as described in Section 1 a hereof. 13. Effect on Unrestricted Homes. Notwithstanding anything herein to the contrary, with the exception of the nondiscrimination provisions set forth in Section 5 hereof, the provisions in this Declaration shall be effective only against the Affordable Homes, and shall not be effective or enforceable against the Unrestricted Homes. 14. Attorney's Fees. In the event any party hereto brings suit to enforce the terms of this Declaration or on account of breach hereof, the party not prevailing in such suit shall pay all reasonable costs and expenses incurred by the other party in such suit, including, without limitation, court costs, attorneys' fees, and expert witness fees 15. Counterparts. This Declaration may be executed in counterparts each of which, when both Covenantor and Covenantee have signed this Declaration, shall be deemed an original and shall constitute one and same instrument. [end — signature page follows] 882/015610-0061 555941.02 al1/09/04 -14- IN WITNESS WHEREOF, the Covenantee and Covenantor have caused this instrument to be executed on their behalf of their respective officers hereunto duly authorized as of the date set forth above. } ad A (Coy nature ,�; must _l' M, :`Public) "COVENANTEE" THE LA QUINTA REDEVELOPMENT AG a blic body, co or e d politic By. Its: Executive Director "COVENANTOR" CP DEVELOPMENT LA QUINTA, LLC a California limited liability company By: Oliphant Family Trust Its: Member By. Richard R. Oliphant Its: Trustee By: Oliphant Enterprises, Inc. Its: Manager By: Richard R. Oliphant Its: President APPROVED AS TO FORM RUW & TUCKER LLP ; / I " �P 7 11A I A orney for the La Q ' edevelo t _ Agency 882/015610-0061 555941.02 a11/09/04 -15- STATE OF CALIFORNIA ) ) ss COUNTY OF giv _rsiae ) On November 10, 2004 , before me, Regenla Hensley, Notary Public a personally appeared THOpMS P . GENOVESE personally known tome ) to be the person(s) whose name(s) ism subscribed to the within instrument and acknowledged to me that he/,g� executed the same in hi authorized capacity(ies), and that by his signature(s) on the instrument the person(s) or the entity upon behalf of which the person(s) acted, executed the instrument. Witness my hand and official seal. r STATE OF CALIFORNIA ) ) ss COUNTY OF Riverside ) On 1T.) I q0o Ll before me, personally appeared RTCHARu R. OLTPHANT personally known to me (or 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. Witness my hand and official seal. 882/015610-0061 -16- 555941.02 al1/09/04 STATE OF CALIFORNIA ) ) ss COUNTY OF ) On , before me, 31 personally appeared personally known to me (or 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. Witness my hand and official seal. Notary Public [SEAL] 882/015610-0061 _ 17- 555941.02 a11/09/04 EXHIBIT A LEGAL DESCRIPTION OF PROPERTY [See following pages] 882/015610-0061 555941.02 al1/09/04 EXHIBIT "A" LEGAL DESCRIPTION IN THE CITY OF LA QUINTA, COUNTY OF RIVERSIDE, STATE OF CALIFORNIA; PARCEL 8 OF UNRECORDED PARCEL MAP NO. 31116 LYING WITHIN A PORTION OF THE SOUTHEAST QUARTER OF SECTION 19, TOWNSHIP 5 SOUTH, RANGE 7 EAST, SAN BERNARDINO BASE AND MERIDIAN, DESCRIBED AS FOLLOWS: COMMENCING AT THE NORTHWEST CORNER OF SAID SOUTHEAST QUARTER; THENCE NORTH 89033'22" EAST ALONG THE NORTHERLY LINE OF SAID SOUTHEAST QUARTER, ALSO BEING THE CENTERLINE OF MILES AVENUE, A DISTANCE OF 927.69 FEET; THENCE PERPENDICULAR TO LAST MENTIONED COURSE, SOUTH 00026 38"EAST A DISTANCE OF 459.52 FEET TO THE TRUE POINT OF BEGINNING; THENCE SOUTH 44044'32" EAST A DISTANCE OF 91.61 FEET TO THE BEGINNING OF A TANGENT CURVE CONCAVE NORTHEASTERLY HAVING A RADIUS OF 80.00 FEET; THENCE SOUTHEASTERLY ALONG THE ARC OF SAID CURVE THROUGH A CENTRAL ANGLE OF 45027'41" AN ARC DISTANCE OF 63.48 FEET; THENCE TANGENT TO LAST MENTIONED CURVE NORTH 89°47'47" EAST A DISTANCE OF 239.56 FEET TO A POINT ON THE WESTERLY LINE OF TRACT MAP NO.23995-5, ON FILE IN BOOK 280, PAGES 73 THROUGH 75 INCLUSIVE, OF MAPS, RECORDS OF RIVERSIDE COUNTY CALIFORNIA; THENCE SOUTH 00012'13" EAST ALONG SAID WESTERLY LINE AND THE WESTERLY LINES OF TRACT MAP NO.23995-3 ON FILE IN BOOK 273, PAGES 48 THROUGH 51, INCLUSIVE, OF MAPS, AND TRACT MAP NO. 23995-8 ON FILE IN BOOK 284, PAGES 81 THROUGH 84, INCLUSIVE, OF MAPS, ALL IN THE RECORDS OF RIVERSIDE COUNTY, CALIFORNIA, A DISTANCE OF 790.73 FEET; THENCE CONTINUING ALONG THE WESTERLY LINE OF SAID TRACT MAP NO.23995-8 SOUTH 43 5644 WEST A DISTANCE OF 152.65 FEET; THENCE LEAVING SAID WESTERLY LINE NORTH 50°10'13" WEST A DISTANCE OF 547.43 FEET; THENCE NORTH 03033'12" EAST A DISTANCE OF 536.86 FEET TO THE EXHIBIT "A" LEGAL DESCRIPTION BEGINNING OF A NON -TANGENT CURVE, CONCAVE NORTHWESTERLY, HAVING A RADIUS OF 440.00 FEET, A RADIAL LINE PASSING THROUGH SAID POINT BEARS NORTH 27033'13" WEST; THENCE NORTHEASTERLY ALONG THE ARC OF SAID CURVE, THROUGH A CENTRAL ANGLE OF 21033124", AN ARC DISTANCE OF 165.54 FEET TO THE TRUE POINT OF BEGINNING. SUBJECT TO EXISTING EASEMENTS AND RIGHTS OF WAY OF RECORD. CONTAINING 391,757 SQUARE FEET OR 8.993 ACRES, MORE OR LESS LAND fCHARLES HARRIS REG. EXP. 12/31= NO. 4989 OF -oop Pa EXHIBIT "A" W w ---------------���� Wl �1�------------ wo -----------_ N 89'33'22" E 997.30'--_---_ .-_ _------------- E� zi MILES VENUE_---- --� ----------------------------------------- i------ P.O.C. N NW COR. �' I SE 1/4 SEC. 19 W, � _ I NI I of IIN I I �me o� Q I I 1 "=200' r.IIRVE DATA NUMBER DELTA RADIUS ARC LENGTH TANGENT Cl 21'33'24" 440.00 165.54 83.76 C2 4527'41 " 80.00 63.48 33.52 I INE DATA NUMBER DIREC ION DISTANCE L1 S 43' 6'44" W 152.65' L2 S 44'44'32" E 91.61' EXHIBIT B CALCULATION OF AFFORDABLE HOUSING COST "Affordable Housing Cost" for the purposes of the Affordable Housing Agreement is that purchase price (inclusive of the proceeds of the Homebuyer Assistance) which would result in a monthly housing cost which is not less than twenty-eight percent (28%) of the gross income of the purchaser and does not exceed the greater of (a) the product of thirty-five percent (35%) times one hundred ten percent (110%) of Riverside County median income adjusted for family size appropriate for the unit for Eligible Buyers earning not more than one hundred ten percent (110%) of Riverside County median income, or (b) the product of thirty-five percent (3 5%) of the actual gross income of the household for Eligible Buyers earning more than one hundred ten percent (110%) of Riverside County median income. The following is a worksheet of how to calculate Affordable Housing Cost using the two methods set forth above: A. All Moderate Income Buyers Monthly housing costs may not exceed 1/12 of 35% x 110% of Riverside County Median Income adjusted for family size appropriate for the unit. For a two- bedroom housing Unit, monthly housing costs may not exceed 1/12 of 35% x 110% of Riverside County Median Income for a family of 3 (example of Median Income is $45,900 in Riverside County pursuant to regulations issued by the California Department of Housing and Community Development in March 2003, or $1,473). Monthly Housing Costs include: a. Mortgage Principal and Interest b. Private Mortgage Insurance C. Property Taxes d. Fire/Casualty Insurance e. Property Maintenance f. Utilities Allowance g. Homeowner's Association ("HOA") Fees For example, in the following situation, for a 2 bedroom housing Unit, assuming an 8% interest rate on a conventional loan, and assuming a down payment of at least 3% of the purchase price and an average second trust deed loan from the Agency of $60,000, the maximum loan amount would be $137,880 and the maximum purchase price would be $204,000 (down payment of $6,120 + Agency Loan of $60,000 + first trust deed loan of $137,880). The foregoing is based upon the following monthly housing costs: 882/015610-0061 555941.02 al l/09/04 a. Mortgage Principal and Interest $13005.00 b. Private Mortgage Insurance (Included in $0.00 Mortgage Interest Rate) C. Property Taxes $203.00 d. Fire/Casualty Insurance (Included in HOA) $45.00 e. Property Maintenance $20.00 f. Utilities Allowance $65.00 g. Homeowner's Association $120.00 TOTAL: $13,45 8.00 B. Buyer's Income is between 110% and 120% of Riverside County Median Income Under method (b), monthly housing costs may not exceed 1/12 of 35% of the purchaser's income, instead of the formula set forth in paragraph (a) above. For example, if the purchaser is a three -person household earning $54,000 monthly housing costs may not exceed $1,575. The maximum sales price would be calculated in the same manner as in paragraph (a) above. For example, if all the other assumptions stated in that paragraph also apply herein, the purchaser's maximum loan amount would be $149,520, and the maximum purchase price, absent the Agency Second Trust Deed Loan would be $156,000. The foregoing is based upon the following monthly housing costs: a. Mortgage Principal and Interest $1,090.00 b. Private Mortgage Insurance (Included in $0.00 Mortgage Interest Rate) C. Property Taxes $225.00 d. Fire/Casualty Insurance (Included in HOA) $50.00 e. Property Maintenance $20.00 f. Utilities Allowance $65.00 g. Homeowner's Association $120.00 TOTAL: $1,570.00 882/015610-0061 555941.02 al1/09/04 2 The foregoing are intended to be examples of how to calculate affordable housing cost, and the actual numbers will vary depending upon such factors as changes in median income, interest rates, amount of down payment, etc. Please see attached chart of Riverside County median income for moderate income purchasers. RIVERSIDE COUNTY 2003 Affordable Housing Costs for Home Purchase Programs for Persons of Moderate Income(3) (Income figures based on Department of Housing and Community Development Income Limits dated March, 2003) 1 Person Household 2 Person Household 3 Person Household Median Median Median Income $35,700 Income $40v800 Income $459900 Monthly Affordable Monthly Monthly Annual Housing Annual Affordable Annual Affordable Income(') Cost(2) Income Housing_Cost Income Housing Cost $42,850 $1,145 $48,950 $1,309 $55,100 $1,473 4 Person Household 5 Person Household 6 Person Household Median Median Median Income $51,000 Income $55,100 Income $590150 Monthly Monthly Monthly Annual Affordable Annual Affordable Annual Affordable Income Housing Cost Income Housing Cost Income Housing Cost $61,200 $1,636 $66,100 $1,768 $71,000 $1,898 7 Person Household 8 Person Household Median Median Income $639250 Income $679300 Monthly Monthly Annual Affordable Annual Affordable Income Housing Cost Income Housing Cost $75,900 $2,029 $80,800 1 $2,159 DEFINITIONS: 1. Annual Income: Gross income from all sources for all members of the household. 2. Monthly Housing Costs: Amount of mortgage payment principal and interest, mortgage insurance, property taxes, and property insurance. 882/015610-0061 555941.02 a11/09/04 3 3. Moderate Income Affordable Housing Costs: Assumes affordable housing costs computed at 35% of 110% of median income; may not be less than 28% of household's gross income. 982/015610-0061 555941.02 al1/09/04 4 EXHIBIT C REQUEST FOR APPROVAL OF PROPOSED BUYER [SEE ATTACHED PAGES] 882/015610-0061 555941.02 a11/09/04 REQUEST FOR APPROVAL OF PROPOSED BUYER THIS FORM MUST BE DELIVERED TO THE AGENCY BEFORE PROCEEDING WITH ANY TRANSFER OF THE PROPERTY. La Quinta Redevelopment Agency 78-495 Calle Tampico La Quinta, CA 92253 Attn: Project Officer Re: Request for Approval of Proposed Buyer To Whom It May Concern: The undersigned is the owner of real property in La Quinta, located at (the "Property"), which was developed with assistance from the Agency ("Owner"). The Owner now desires to transfer the Property and by this letter is requesting the Agency to approve the proposed buyer. l . The Proposed Buyer is: Name: Current Address: Telephone Number: 2. The terms of the proposed transfer are (a) Sales price of $ . This sales price is based on the lesser of W Fair market value; or The maximum price at which the Purchase Housing Cost of the Proposed Buyer would not exceed Affordable Housing Cost. The calculation of the Sales Price under this subsection (ii) is illustrated in Exhibit `B" to the Declaration of Covenants, Conditions, and Restrictions for Property. 882/015610-0061 555941.02 all/09/04 IN ORDER TO ANSWER QUESTION 2(b) YOU MUST CALCULATE THE PROPOSED SALES PRICE BASED ON AFFORDABLE HOUSING COST, TAKING INTO CONSIDERATION ALL ITEMS LISTED IN THE DEFINITION OF PURCHASE HOUSING COST. (b) Price of any personal property being sold by the Owner to the proposed buyer: $ . (If none, so state.) (c) The price of $ to be paid by the proposed buyer for any services of Owner. (If none, so state). (d) All other amounts of money or other consideration, if any, concerning the Property or any other matter to be paid by the proposed buyer to the Owner: $ (If none, so state.) (e) Sources of payment of sales price: Sales price $ Cash down payment $ 1 st loan $ 2nd loan $ Other (describe) $ Total $ (f) The financing obtained by the proposed buyer to purchase the Property is as follows: 1 st Loan: Loan amount $ Monthly payments: $ Interest rate If variable interest, describe adjustment mechanism: Due date: Balloon payment amount: Points and fees: 882/015610-0061 555941.02 a11/09/04 _3_ Lender: Lender's address: 2nd Loan: Loan amount: $ Monthly payments: $_ Interest rate _ If variable interest, describe adjustment mechanism: Due date: Balloon payment amount: Points and fees: Lender: Lender's address: Other Loans: (describe, if none, so state) (g) The monthly Purchase Housing Cost to be paid by the proposed buyer: 1 st loan monthly payment: $ 2nd loan monthly payment: $ Other loans monthly payment: $ Taxes and assessments (1 / 12 of $ yearly taxes and assessments): Insurance (1 / 12 of yearly $ premium): Homeowner's dues: $ Total: $ 982/015610-0061 555941.02 al 1/09/04 _q _ 3. The proposed buyer represents, warrants and covenants the following: (a) The Property will be the principal residence of the proposed buyer. (b) The combined maximum annual income for all household members of the proposed buyer is $ . (This figure must include all sources of income.) (c) The proposed buyer will deliver to the Agency a signed financial statement on a form acceptable to the Agency. 4. The proposed buyer's household consists of the following persons who will reside in the Property: Adults (18 or over) - [name of each] : Minors (under 18) [name of each] : 5. The proposed buyer must submit to the Owner, on a form available from the Owner, an income certification so the Owner may determine if the proposed buyer is an Eligible Buyer. 6. A true and correct copy of the proposed buyer's most recent tax return to the U.S. Internal Revenue Service is attached hereto. 7. A true and correct copy of the purchase and sale or other agreement between the Owner and the proposed buyer is attached hereto. 882/015610-0061 555941.02 A 1/09/04 5 I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct. OWNER: Date signature signature print name print name street address telephone city state zip code PROPOSED BUYER: Date signature signature print name print name street address telephone city state zip code 882/015610-0061 _L _ 555941.02 al1/09/04 L Owner's Certification Based on the Proposed Buyer's Certificate above, and all documents attached hereto, Owner hereby certifies that: (1) Proposed Buyer is an Eligible Buyer; and (2) The monthly Purchase Housing Cost to be paid by the Proposed Buyer shall not exceed the monthly Affordable Housing Cost. [Capitalized terms used above are defined in the Agreement to which this certificate is attached unless otherwise provided herein.] OWNER: [Name] Date: 882/015610-0061 555941.02 A 1/09/04 %