Affordable Housing Resale Restrictions; Option Agreement and Option to Designate Purchaser 2006-0403434n `
Ren ording requested by:
CHICAGO TITLE COMPA�
NO CHARGE ON THIS DOCUMENT FOR
THE BENEFIT OF
THE CITY OF POWAY
Recording Requested By
And When Recorded Mail To:
THE CITY OF POWAY dV
1332 Civic .Center Drive
Poway, CA 92064
ATTN: Housing Program Manager
D(f # 2006 - 0403434
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JUN 07, 2006 2:59 PM
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6- 0 403434
AFFORDABLE HOUSING RESALE RESTRICTIONS;
OPTION AGREEMENT AND OPTION TO DESIGNATE PURCHASER
(80% AMI)
This Affordable Housing Resale Restrictions; Option Agreement and Option to Designate
Purchaser ( "Resa trictpn ") is gyecuted this 23rd day of May. 2006, by the City of Poway
( "City "), and by / / cOV 0i�n and�Natsuko Lauritzen, as owner ( "Owner ") of the real property
located in the City of Poway, County of San Diego, State -of California, more particularly
described on Exhibit "A" attached hereto (the "Property ").
RECITALS
WHEREAS, concurrently with the recordation of this Resale Restriction, the City is
funding a loan (the "City Loan") evidenced by a promissory note (the "Note ") and secured by a
deed of trust ( "City Deed of Trust "), to aid Owner, who is a first -time homebuyer or displaced
homemaker, in acquiring the Property. The City Deed of Trust and City Loan were conditioned
in part upon the recordation of a document granting a purchase option to the City and setting
forth certain restrictions upon the use and sale of the Property.
WHEREAS, the purposes of this Resale Restriction are to (i) grant the City an option to
acquire the Property, (ii) establish resale and occupancy restrictions for the residential unit on the
Property, and (iii) to restrict the Property with this Resale Restriction for a period of forty -five
(45) years following each sale of the Property; all to be binding on Owner and all subsequent
purchasers of the Property.
NOW, THEREFORE, City and Owner hereby declare and restrict the Property as
follows:
1. Definition of Owner and Acknowledgment and Certification Any purchaser of the
Property from Owner and any subsequent purchaser from such purchaser or successors is each
CGtyotPoway \SIIOP \80%Res IeRestngion
0
referred to as "Owner" through the balance of this Resale Restriction. Each Owner shall certify
his /her acknowledgment of this Resale Restriction and all the provisions and restrictions
contained herein. Each Owner shall certify his /her acknowledgment by executing the form
attached as Exhibit `B."
2. Warranties of Owner Each Owner warrants to City as follows:
(a) that he /she is (i) a first -time homebuyer; that is, he or she has not owned a home
within the three -year (3 -year) period immediately preceding the date of the purchase of the
Property; or (ii) a displaced homemaker. "Displaced homemaker" shall have the meaning
ascribed to it in the Family Code of the State of California, as amended from time to time;
(b) that he /she will occupy the Property as his/her or their principal place of
residence. throughout his /her or their ownership of the Property during the "Affordable Term ",
as defined below. The Owner shall be considered as occupying the Property as a principal place
of residence if the Owner is living on the Property for at least ten (10) months out of each
calendar year. Owner shall not lease or rent the Property for more than thirty (30) days per
calendar year;
(c) that Owner's annual gross income does not exceed eighty percent (80 %) of the
median income for the San Diego County metropolitan area, as adjusted for family size, as said
.median income is determined by the Department of Housing and Community Development, as
amended from time to time, on the date of the recordation of the Lender Deed of Trust; and
(d) that Owner does not hold, directly or indirectly, "net family assets ", as defined in
25 Cal. Code of Regulations Section 6914, whose aggregate value exceeds those limits
referenced within 25 Cal. Code of Regulations Section 6914.
3. Restrictions on Transfer
(a) Forty -Five Year Affordable Term During the "Affordable Term ", as defined
below, any transfer of the Property shall be subject to the provisions of this Resale Restriction.
Any subsequent transfer by the Owner to a subsequent Owner shall also be subject to the
provisions of this Resale Restriction until the end of the subsequent Owner's Affordable Term.
The parties intend to restrict the sale and occupancy of the Property for the "longest feasible
time," as defined in California Health & Safety Code § §33334.3 and 33413, which sections
define the "longest feasible time" to include "unlimited duration."
(b) Affordable Term Defined The "Affordable Term" shall be the period of forty -
five (45) years measured from the date each Owner obtains ownership or any interest in the
Property, and provided that such ownership or any interest in the Property is transferred prior to
expiration of the Affordable Term, then the Affordable Term shall begin anew from the date
each subsequent Owner obtains ownership or any interest in the Property and shall run for forty -
five (45) years beginning on such date.
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(c) :.. Defined The following shall all be considered transfers or sales of the
Property and shall be referred to herein generally as a "Sale ": (i) all or any part of the Property or
any interest in the Property is sold, conveyed or transferred, (ii) if Owner is not a natural person
and a beneficial interest in Owner is sold, conveyed or transferred, (iii) all or any part of the
Property is refinanced, except as provided in (d) below, (iv) Owner does not occupy the Property
as his, her, or their, primary residence, (v) any material breach of the Note, Note Rider, this
Resale Restriction or the City Deed of Trust, (vi) filing bankruptcy, or (vii) transfer to one
spouse after a divorce. The term "Sell," may be used herein in place of the term "Sale," where
appropriate and as used herein shall mean a Sale.
(d) Exclusions from Definition of Sale Notwithstanding the foregoing, a refinancing
of the Property shall not be considered a Sale, provided either:
(1) The principal balance of Owner's loan after the refinancing, does not
exceed the principal balance of Owner's loan before the refinancing, plus reasonable closing
costs; or
(2) Both of the following conditions are met, and provided that the City
provides advance written consent to the Owner of the refinancing: (i) the Owner receives cash
a from such refinancing, which does not exceed ten percent (10 %) of the principal balance of
r.:;, • Owner's loan before the refinancing; and (ii) such cash is borrowed for the purpose of and is
used fonimprovements to the Property, which improvements are preapproved by the City prior to
Owner's obtaining the refinancing.
4. - Maintenance and Inspection of Property Owner shall maintain the Property and the
improvements thereon in good condition and repair and in compliance with the standards
promulgated from time to time by the City, throughout the Owner's period of ownership of the
Property. In addition, upon City's receipt of a Notice of Intent to Transfer as detailed in Section
5 below, City shall be given the right to enter and to inspect the Property to determine whether
any violations of applicable building, plumbing, electric, fire, housing or other applicable codes
exist and whether the Property has been maintained in good condition, upon reasonable written
notice of not less than ten (10) days. City shall notify Owner with regard to any noted code
violations and maintenance deficiencies (collectively, the "Deficiencies "), and Owner shall cure
the Deficiencies in a reasonable manner acceptable to the City within sixty (60) days of being
notified in writing of the result of the inspections.
5. Notice of Transfer In the event the Owner intends to Sell the Property, the Owner shall:
(a) Promptly notify City in writing of such intent ( "Notice of Intent to Transfer ")
prior to notifying the public of such intent, including, without limitation, prior to notifying real
estate brokers or lenders of Owner's intent to Transfer the Property and prior to listing the
Property on the Multiple Listing Service (hereinafter referred to as the "Notice of Intent to
Transfer, ") by certified mail return receipt requested, to the City of Poway, 13325 Civic Center
Drive Poway, CA 92064, Attention: Housing Program Manager, or such other address as the
City may hereafter designate in writing. The Owner has the right to withdraw the Notice of
Intent to Transfer prior to the opening of escrow to purchase the property:
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(b) Within fifteen (15) days of the delivery of the Notice of Intent to Transfer, the
Owner shall obtain and deliver to the City, a current written report of inspection of the Property
by a licensed structural pest control operator;
(c) Prior to the close of escrow on the Transfer, the Owner shall repair all damage
noted in the pest -report including damage caused by infestation or infection by wood - destroying
pests:
(d) Within fifteen (15) days of delivery of the Notice of Intent to Transfer, the Owner
shall allow the City to inspect the Property to determine its physical condition;
(e) If the Property is vacant, the Owner shall maintain utility connections until the
close of escrow on the transfer; and
(f) In the event of a purchase of the Property by the City, the Owner shall permit a
final walk - through of the Property by the City.
6. Determination of Maximum Restricted Resale Price
(a) Calculation of Maximum Restricted Resale Price Except as otherwise provided
•`,,.;;. herein, the amount of money and /or other consideration that any Owner may receive for any Sale
of the - Property shall be called the "Maximum Restricted Resale Price. " The Maximum
Restricted Resale Price shall be the lesser of: (i) the Fair Market Value, as defined in Section
:. 6(f), below; and (ii) the purchase price which would result in a Monthly Housing Cost, as
determined by the City, which does not exceed the sum of: (A) the product of one twelfth (1/12)
of thirty -five percent (35 %) times eighty percent (80 %) of median income for the San Diego
metropolitan area, as adjusted for household size appropriate to the unit, plus (B) the Owner's
three percent (3 %) downpayment. Notwithstanding the foregoing or anything contained herein
to the contrary, under no circumstances shall the Maximum Restricted Resale Price be less than
the sum of the current balance of the First Lien ( "First Lien" means the lien of the institution
making the purchase money loan to an Owner for the purchase of the Property and /or any
acceptable refinancings), plus the Owner's share of escrow, title and other closing costs as set
forth herein.
(b) Insurance Coverage Insurance premiums shall be the average of three quotes
obtained by the City for the coverage required for the First Lender Deed of Trust. The deductible
for the insurance shall not exceed the sum of Five Hundred Dollars ($500.00) per occurrence.
(c) Monthly Housing Cost As used herein "Monthly Housing Cost" means all of the
following associated with the Property, estimated or known as of the date of the proposed Sale of
the Property: (i) principal and interest payments on a thirty -year, fixed -rate mortgage loan at the
then currently prevailing market rate of interest, and any loan insurance fees associated therewith
(except for a refinancing with cash out, if allowed under Section 3(c)(2), above, under no
circumstances shall Borrower or any purchaser obtain a mortgage loan that contains an
adjustable interest rate); (ii) property taxes, assessments, including Mello Roos fees, if
applicable; (iii) fire and casualty insurance covering replacement value of property
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improvements (to the extent not covered by the homeowner association encompassing the
Property); (iv)-any homeowner association fees; (v) private mortgage insurance, if applicable;
and (vi) reasonable" costs of utilities. Monthly Housing Cost of the Owner shall be an average of
estimated costs for the next twelve (12) month period as of the date of the Notice of Intent to
Transfer.
(d) Capital Improvements The Maximum Restricted Resale Price shall be increased
by a sum equal to any capital improvements to the Property, valued at their original cost plus
interest at the legal rate on such improvements to the date of resale, approved by the City in
writing, prior to their installation, during the term of the Owner's ownership and reasonable
closing costs and marketing expenses
(e) Maximum Restricted Resale Price Calculation Requests At any time during the
term of this Resale Restriction, an Owner may obtain a written calculation showing the amount
of the Maximum Restricted Resale Price for the Property and its method of calculation from the
City, by requesting the same in writing, provided that such calculation may not be obtained more
frequently than once per calendar year during the term of the Note.
(f) Determination of Fair Market Value If it is necessary to determine the Fair
Market Value of the Property, it shall be determined by a certified MAI or other qualified real
a; estate appraiser approved in advance by the City. If possible, the appraisal shall be based upon
the sales prices of comparable properties sold in the market area during the preceding three (3)
month period. The cost of the appraisal shall be paid by the Owner, unless the appraisal is
x. obtained from a new purchaser. Nothing in this section shall preclude the Owner and the City
from%establishing the Fair Market Value of the Property by mutual agreement in lieu of an
appraisal pursuant to this section.
7. City's Election to Exercise Option or Require Sale to an Eligible Purchaser Within forty -
five (45) days after receipt by the City of the Notice of Intent to Transfer and before Owner has
opened escrow with another buyer, provided that City shall have a minimum of thirty (30) days
from the date the City receives the Notice of Intent to Transfer, the City shall in its sole discretion
notify the Owner of one of the following:
(a) notify the Owner regarding whether or not the City intends to exercise its Option to
purchase the Property, as provided in Section 8, below:
(b) notify the Owner that the Owner may only Sell the Property to an Eligible
Purchaser, as defined hereinbelow, for the Maximum Restricted Resale Price, as provided in
Section 9, below, in which event, such Eligible Purchaser shall assume all of the obligations of
Owner under the Note, the Resale Restriction and the Deed of Trust; or
(c) notify the Owner that the Owner may only Sell the Property to an Eligible Purchaser
designated by the City for the Maximum Restricted Resale Price, as provided in Section 10, below,
in which event, such Eligible Purchaser shall assume all of the obligations of Owner under the
Note, the Resale Restriction and the Deed of Trust.
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8. City's Option to Purchase the Property The Owner hereby grants an option (the "Option ")
to the City to purchase the Property on the following terms and conditions:
(a) Grant of Option Owner hereby grants to City the Option to purchase the Property
on the terms and conditions set forth herein. The purchase price payable by the City to the Owner
for the Property (the "Option Price ") shall be the greater of (i) the Maximum Restricted Resale
Price, as defined in Section 6 hereof, or (ii) the sum of the then current balance of the First_ Lender
Deed of Trust, plus the Owner's share of escrow, title and other closing costs. The Option created
hereby shall be irrevocable by Owner and shall be binding upon the successors and assigns of
Owner. The City shall have the right of specific performance to enforce the terms of this Option.
(b) Term and Consideration for Option The term of the Option shall commence on the
date that title to the Property is recorded in the name of Owner, and shall expire forty-five (45) years
thereafter. Notwithstanding the foregoing, if ownership or any interest in the Property is transferred
prior to expiration of such forty -five (45) year period, then the term of the Option shall commence
on the date that title to the Property is recorded in the name of a subsequent Owner, and shall expire
forty -five (45) years thereafter.
(c) Exercise of Option The Option may be exercised by (i) the City's delivery to
Owner of written notice of such exercise (the "Exercise Notice'), at any time after receipt by the
,. City of -the Notice of Intent to Transfer and before Owner has opened escrow with another buyer,
provided that City shall have a minimum of thirty (30) days to exercise the Option; or (ii) in the
event of any default under the Note, the City Deed of Trust or the Resale Restriction. In the event
that the City exercises the Option as the result of an event of any default under the Note, the City
Deed-of Trust or the Resale Restriction, but the Owner cures the default prior to the sale of the
Property,to the City, the City's exercise of the Option shall be deemed revoked. The revocation of
the exercise of the Option shall not terminate the Note or preclude the City from subsequently
exercising the Option upon a later event of default.
(d) Escrow and Completion of Sale Within five (5) days after City has exercised the
Option, or as soon thereafter as reasonably practicable, an escrow shall be opened with Chicago
Title Escrow or such other escrow company as determined by City for the conveyance of the
Property to the City. The City shall deposit the Option Price in escrow not later than one (1)
business day prior to the anticipated close of escrow date. The City's obligation to close escrow
shall be subject to the City's approval of a then current preliminary title report and, at City's option,
environmental and other site testing. Any exceptions shown on such preliminary title report created
on or after the Owner's acquisition of the Property shall be removed by Owner at its sole expense
prior to the close of escrow, unless such exception(s) is(are) accepted by City in its reasonable
discretion; provided, however, that City shall accept the following exceptions to title: (i) current
taxes not yet delinquent, (ii) matters affecting title existing on the date of Owner's acquisition of the
Property, (iii) liens and encumbrances in favor of the City, (iv) the First Lender Deed of Trust, (v)
the Note, and (vi) matters shown as printed exceptions in Owner's standard form CLTA owner's
policy of title insurance. The parties shall each be responsible for one -half of the escrow fees,
documentary transfer taxes, recording fees and any other costs and expenses of the escrow, and the
Owner shall-be responsible for the cost of a CLTA owner's policy of title insurance. City shall have
thirty (30) days after exercise of the Option to enter upon the Property to conduct any tests,
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inspections, investigations, or studies of the condition of the Property. Owner shall permit the City
access to the Property for such purposes. Escrow shall close promptly after acceptance by City of
the condition of title and the physical and environmental condition of the Property, and in no event
later than ninety (90) days after the date that the City has exercised the Option. Until such closing,
the terms of the Note and the documents executed and recorded pursuant hereto shall remain in full
force and effect.
9. Sale of the Property to an Eligible Purchaser at or Below the Maximum Restricted Resale
Price Upon receipt of the Notice of Intent to Transfer, the City shall have the right, but not the
duty, to require that the Owner may only sell the Property to an Eligible Purchaser in the manner
set forth in this Section 9. At any time after receipt by the City of the Notice of Intent to Transfer
and before Owner has opened escrow with another buyer, provided that City shall have a minimum
of thirty (30) days from the date the City receives the Notice of Intent to Transfer, the City shall
notify the Owner regarding whether or not the City intends to require the Owner to sell the
Property to an Eligible Purchaser. Except as otherwise provided in this Resale Restriction, if a
Sale of the Property occurs during any Affordable Term, then said Sale shall be subject to the
following:
(a) The Property may only be sold, transferred or conveyed to a subsequent purchaser
;., (i) whose income is less than eighty percent (80 %) of the median income for the San Diego
-,. metropolitan area, as adjusted for family size and as verified and approved by the City, and (ii) who
.. does not hold, directly or indirectly, "net family assets", as defined above, whose aggregate value
does not exceed those limits allowed in 25 California Code of Regulations Section 6914.
•.(b) The Property must be used only as the principal residence of the subsequent
purchaser. during the time of ownership.
(c) The sale price to the subsequent purchaser must be at or below the Maximum
Restricted Resale Price.
(d) The subsequent purchaser must be (i) a first -time homebuyer; that is, he or she has
not owned a home within the three -year (3 -year) period immediately preceding the date of the
purchase of the Propertv; or (ii) a displaced homemaker, as defined above.
(e) This Resale Restriction shall remain in effect for forty -five (45) years from the date
title records in the name of the new Owner, and provided that such ownership or any interest in
the Property is transferred prior to expiration of the Affordable Term, then the Affordable Term
shall begin anew from the date title records in the name of each subsequent Owner and shall
remain in effect for forty -five (45) years beginning on such date.
(f) The purchaser of the Property assumes all of the obligations of Owner under the
Note, this Resale Restriction and the Deed of Trust. In which event, the term of the Note will start
over and will run for 45 vicars from the date title records in the name of the new Owner.
(g) Provided Owner Sells the Property to a person or persons meeting the
requirements of paragraphs 9(a) through 9(0, inclusive (herein an "Eligible Purchaser "), before
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the end of the Affordable Term as defined in paragraph 3(a), the City shall recapture from such
Sale a share of the Equity as provided in Section I 1 hereof.
10. CiWs Right to Designate an Eligible Purchaser Upon receipt of the Notice of Intent to
Transfer, the City shall have the right, but not the duty, to designate an Eligible Purchaser to
purchase the Property from its list of interested buyers. At any time after receipt by the City of
the Notice of Intent to Transfer and before Owner has opened escrow with another buyer, provided
that City shall have a minimum of thirty (30) days from the date the City receives the Notice of
Intent to Transfer, the City shall notify the Owner regarding whether or not the City intends to
exercise its right to designate an Eligible Purchaser. The notification to the Owner regarding the
right to designate an Eligible Purchaser shall be sent by certified mail, return receipt requested.
If the City exercises this right to designate an Eligible Purchaser, the City shall cause an escrow
for the purchase of the Property to be opened within thirty (30) days following such notification
to the Owner, and the designated Eligible Purchaser shall purchase the Property within ninety
(90) days following the receipt by the City of the Notice of Intent to Transfer. The City
designated buyer shall be prequalified by a lender approved by the City.
11. Equity Sharing
(a) Eguity•Shared Between Owner and City Upon a Sale of the Property to an
_! EligibleP.urchaser during an Affordable Term, then upon such Sale the City shall receive from
the proceeds of such Sale, an amount equal to the City's Equity Share multiplied by the Equity,
as such terms are defined below. Provided, however, that if there are insufficient funds resulting
from the Sale of.the Property to fully pay off the Note and the City's Equity Share, then City
shall recapture the entire net proceeds from such Sale. The net proceeds of Sale means the sale
price ofthe Property minus the repayment of all loans prior to the City Loan minus closing costs.
Prepayment of the Note shall not affect Owner's obligation to share the Equity as provided
herein and as provided in the Resale Restriction.
(b) Calculation of Equity Sharing
(1) Initial Equity Shares The City's initial share of the Equity shall be fifty -
six percent (56 %) (the "City's Initial Equity Share ") and the Owner's initial share of the Equity
shall be forty -four percent (44 %) (the "Owner's Initial Equity Share "). The City's Initial Equity
Share, as provided in the immediately foregoing sentence, is calculated by dividing (i) the
original principal amount of the Note; by (ii) the initial purchase price of the Property. The
City's Initial Equity Share will not change as a result of the assumption of the Note by an
Eligible Purchaser.
(2) Reduction in City's quity Share In the event of a Sale, the City's
Equity Share and the Owner's Equity Share, shall be the percentages provided in the following
table (the City's Equity Share will not change as a result of the assumption of the Note by an
Eligible Purchaser):
c�� �oN�ue�,irRes��n�o�
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If the Closing of the
The City's Equity Share
The Owner's Equity Share Will
Sale Occurs:
Will Be:
Be:
more than 5,years, but
City's Initial Equity Share minus
Owner's Initial Equity Share plus
less•than 15 years
one (1) percentage point
one (1) percentage point
after the date of the
Note
more than 15 years,
City's Initial Equity Share minus
Owner's Initial Equity Share plus
but less than 30 years
two (2) percentage points
two (2) percentage points
after the date of the
Note
more than 30 years,
City's Initial Equity Share minus
Owner's Initial Equity Share plus
but less than 45 years
three (3) percentage points
three (3) percentage points
after the date of the
Note
45 or-more years after
City's Initial Equity Share minus
Owner's Initial Equity Share plus
the date of the Note
four (4) percentage points
four (4) percentage points
(c)'• Equity Defined Equity means the dollar amount that constitutes the difference
between the Maximum Restricted Resale Price and the sum of the following amounts:
(1) the outstanding principal of the First Note and First Lender Deed of Trust,
as such-terms are defined in the Note;
(2) the original principal of the Note and the City Deed of Trust;
(3) all amounts actually paid by the Owner to purchase the Property, including
(i) Owner's downpayment, if any, not including the City Loan, (ii) escrow fees, (iii) transfer
tares, (iv) recording fees, (v) brokerage commissions and (vi) similar costs of acquisition
actually paid by the Owner. plus not less than the legal rate of interest on those cash payments.
Provided, however, that the foregoing amounts shall not be included to the extent any of the
foregoing amounts, or any portion thereof, were "rolled into" or paid out of the Note or the First
Note; and
(4) amounts actually paid by the Owner for capital improvements to the
Property, provided such improvements were preapproved by the City prior to construction of
such improvements and provided that such improvements have been documented to the
satisfaction of City, plus not less than the legal rate of interest on those cash payments.
(d) . No Additional Interest Except in the event of a default under the terms of the
Note, the City Deed of Trust and /or this Resale Restriction, interest shall not accrue on the Note
and the entire amount which the City shall be entitled is the amount determined in this Section.
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12. Sale After Affordable .Term In the event that an Owner owns the Property for forty -five
(45) years and the Affordable Term applicable to that Owner expires. then the Note shall become
due and payable in full at such time.
13. Defaults and Remedies Upon a violation of any of the provisions of this Resale
Restriction, the City shall give written notice to the Owner by certified mail return receipt
requested, specifying the nature of the violation. If the violation is not corrected to the
satisfaction of the City within a reasonable period of time, not longer than thirty (30) days after
the date the notice is mailed, or within such further time as the City determines is necessary to
correct the violation, the City may declare a default under this Resale Restriction. Upon the
declaration of a default, the City may apply to a court of competent jurisdiction for specific
performance of the obligations of this Resale Restriction, for an injunction prohibiting a
proposed transfer in violation of this Resale Restriction, for a declaration that a transfer in
violation of the provisions of this Resale Restriction is void, or for any such other relief at law or
in equity as may be appropriate. In addition, the City may declare the note immediately due and
payable and if unpaid may foreclose under the Note and City Deed of Trust and /or may exercise
its option to acquire the Property. In the event of a default by the Owner, and /or by the Owner's
transferee in those circumstances where a transfer has occurred in violation of this Resale
Restriction,. the Owner and /or the Owner's transferee shall hold the City and the Owner and their
respective employees or other agents harmless and reimburse the expenses, legal fees and costs
for any action the City takes in enforcing the provisions of this Resale Restriction.
a... 14. Non - liability of the City In no event shall the City become in any way liable or
obligated to the Owner or to any successor -in- interest of the Owner by reason of its Option to
_ purchase the Property, nor shall the City be in any way obligated or liable to the Owner or any
successor -in- interest of the Owner for the City's failure to exercise such Option to purchase the
Property.
15. Binding on Successor and Assigns This Resale Restriction shall bind, and the benefit
hereof shall inure to, the Owner, subsequent Owners, and to their respective heirs, legal
representative executors, successors in interest and assigns, and to the City and its successors.
Provided, however, upon a release of this Resale Restriction, either through a foreclosure or the
receipt of a deed in lieu of foreclosure by the holder of the First Lien, this Resale Restriction,
shalt not thereafter reattach.
16. Subordination This Resale Restriction may be recorded in second lien priority position
to a first priority institutional lender financing the Owner's purchase of the Property.
17. General Provisions
(a) Invalid Provisions If any one or more of the provisions contained in this Resale
Restriction shall for any reason be held to be invalid, illegal or unenforceable in any respect then
such provision or provisions shall be deemed severable from the remaining provisions contained
in this Resale Restriction, and this Resale Restriction shall be construed as if such invalid, illegal
or unenforceable provision had never been contained herein. If a court of competent jurisdiction
determines, by way of final unappealable order or judgment, that the interest rate charged under the
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Note secured by this Resale Restriction is usurious, then such rate shall automatically and
retroactively be reduced to the maximum rate allowed under applicable law.
(b) Controlling Law The terms of this Resale Restriction shall be interpreted under
the laws of the State of California.
(c) Notices All notices required herein shall be sent to the City by certified mail
return receipt requested, as follows:
City of Poway
c/o Housing Program Manager
13325 Civic Center Drive
Poway, CA 92064
or such other address that the City may subsequently request in writing. Notices to the Owner
shall be sent by certified mail return receipt requested to the Property address.
(d) Interpretation of Restriction Covenants The terms of this Resale Restriction shall
be interpreted to encourage to the extent possible that the Maximum Sales Price of and mortgage
payments for the Property remain affordable to households earning eighty percent (80 %) of the
median, for the Metropolitan Statistical Area of San Diego County as adjusted annually
and as further adjusted for household size.
(e) Non - Discrimination Covenants The Owner covenants by and for itself and any
successors in interest that there shall be no discrimination against or segregation of any person or
group of•persons on account of race, color, creed, religion, sex, marital status, national origin,
age or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the
Property, nor shall the Owner 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 of the Property. The foregoing covenants shall run with the land.
(t) Written Consent of City Required Before Transfer During the Affordable Term,
the Property, and any interest therein, shall not be conveyed by any Transfer or refinancing,
except as expressly provided in this Resale Restriction, except with the express written consent
of the City.
(g) Monitoring The Owner shall annually report to the City, in writing, confirming
that they continue to reside in the Property, have not leased or rented the Property for more than
the allowed, period of time, providing evidence of insurance, evidence of the payment of taxes, if
not impounded, and any and all other information reasonably needed by the City to assure
compliance with the terms of this Resale Restriction on a form or forms prepared by the City.
Within 15 days of a written request from the City to the Owner, Owner shall respond with all
information requested to enable the City to complete its monitoring responsibilities under the
terms of this Resale Restriction. Failure to completely and timely comply with requests shall be
deemed a material default under the terms of this Resale Restriction.
City.IPo .av SHOMW.6Re Ia Re Irmo
0
12858
IN WITNESS WHEREOF, the parties have executed this Resale Restriction on or as of
the date first written above.
City of Poway
By:
Print Name: Rod could
Its: City Manager
<Attach Notary Acknoivledgmenl>
OWNER:
Print Name:j{T William J. Lauritzen
Print Name: Natsuko Laufitzen
<Attach Notary Acknowledgmenl(s)>
12
GiyolPnuev\S110P%ReuIeR, amceon
12859
ACKNOWLEDGMENT
State of California
County of San Diego
On D
personally Appeared,
me,
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 "OPTION AGREEMENT, OPTION TO
DESIGNATE PURCHASER AND AFFORDABLE HOUSING RESALE
RESTRICTIONS" and acknowled e o me that(P,4 /Lkcy executed the same in 4&herAfh@ir
authorized capacity(iasT,"�nd that hi tlW signature(,s�ron the instrument the person(sT,
the entity on behalf of which the person(�4cted, executed the instrument.
WITNESS my hand and official seal.
Signature VI
(Seal)
w I
r
! .I I
13
CnvetPowav \SHOP \80°.oResaleResvmion
M44
ACKNOWLEDGMENT
State of California
County of San Diego
On j 111A -e- l0 2006, before me . T�eAC /E L• /�2`C Do /JvrJr�y Puea,
personally appeared, 2A )' / /i2w S k0Ljr; f Zeh oral /yA ?st[�o LftuQ rze� personally
known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose
name(s) ' re subscribed to the within instrument "OPTION AGREEMENT, OPTION TO
DESIGNATE PURCHASER AND AFFORDABLE HOUSING RESALE
RESTRICTIONS" and acknowledged to me that h �e executed the same in l�/ ei
authorized capacity(ies), and that by his4w t g� signature(s) on the instrument the person(s), or
the entity on behalf of which the person(s) acted, executed the instrument.
TRACIE L MC CLENDON
hand and official seal. otmm,seienstassaao
WITNESS m
y S Wpiery public - CaRfomla
g San Diego County
My Comm EWres Jul 28,2008
Signature. el/ �. `( �L (Seal) V.
14
nyoWnw V\SHOV%Hes IeNestndion
0
0
12861
ACKNOWLEDGMENT
State of California )
County of San Diego )
On , 2006, before me,
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 "OPTION AGREEMENT, OPTION TO
DESIGNATE PURCHASER AND AFFORDABLE HOUSING RESALE
RESTRICTIONS" 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 on behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
Signature
(Seal)
15
ni,„rvow�y\si
0
i
12862
A CONDOMINIUM COMPOSED OF:
PARCEL 1
LEGAL DESCRIPTION L�C�l1b�
AN UNDIVIDED 1 /48TH FRACTIONAL INTEREST AS TENANT IN COMMON IN AND TO:
LOT 1 OF CITY OF POWAY TRACT NO. 87 -10, IN THE CITY OF POWAY, COUNTY OF SAN DIEGO,
STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 12668, FILED IN THE OFFICE OF THE
COUNTY RECORDER OF SAN DIEGO COUNTY, JULY 24, 1990.
EXCEPTING THEREFROM ALL PHASE SEPARATE INTERESTS IN SPACE AND LIVING UNITS AS SHOWN
UPON AND DEFINED IN THE CONDOMINIUM PLAN PHASES 1 AND 2, COUNTRY ROADS CONDOMINIUMS,
RECORDED IN THE 'OFFICE OF THE COUNTY RECORDER OF SAN DIEGO - COUNTY, CALIFORNIA, ON
JULY 21, 1992 AS DOCUMENT'NO. 92- 0455804 OF OFFICIAL RECORDS.
PARCEL 2:
AN UNDIVIDED.1 /•24TH FRACTIONAL INTEREST AS TENANT IN COMMON IN AND TO THE PHASE I
SEPARATE INTEREST IN SPACE AS SHOWN UPON AND DEFINED IN THE ABOVE DESCRIBED
CONDOMINIUM PLAN.
EXCEPTING 'THEREFROM ALL LIVING UNITS LOCATED THEREIN AS SHOWN UPON THE CONDOMINIUM
PLAN REFERRED TO ABOVE
PARCEL 3:
LIVING UNIT NO. 45, AS SHOWN AND DEFINED UPON THE CONDOMINIUM PLAN REFERRED TO
ABOVE.
PARCEL 4:
THE EXCLUSIVE RIGHT TO THE USE, POSSESSION AND OCCUPANCY OF THOSE PORTIONS OF PARCEL
2 DESCRIBED ABOVE WHICH ARE DESIGNATED ON THE CONDOMINIUM PLAN REFERRED TO'ABOVE AS
"EXCLUSIVE USE COMMON AREAS" BEARING THE SAME NUMBER AS THE LIVING UNIT DESCRIBED IN
PARCEL 3 ABOVE, WHICH SHALL BE APPURTENANT TO PARCEL 3 DESCRIBED ABOVE.
PARCEL 5:
A NON- EXCLUSIVE EASEMENT FOR INGRESS, EGRESS AND RECREATIONAL USE, ON, OVER AND
UNDER THE PHASE COMMON AREA OF PHASE 2 AS SHOWN UPON THE CONDOMINIUM.PLAN REFERRED
TO ABOVE; EXCEPTING THEREFROM ANY CONDOMINIUM BUILDINGS THEREON AND ANY PORTION
THEREOF WHICH IS DESIGNATED AS AN EXCLUSIVE USE COMMON AREA, WHICH EASEMENT SHALL BE
APPURTENANT TO PARCEL 3 DESCRIBED,ABOVE. THIS NON - EXCLUSIVE EASEMENT SHALL BECOME
EFFECTIVE UPON RECORDATION OF A NOTICE OF COMPLETION FOR ALL OF THE IMPROVEMENTS
LOCATED IN SUCH PHASE 2 AND FURTHER SUBJECT TO THE CONDITIONS AND RESTRICTIONS SET
FORTH IN RECITAL "J" OF THE DECLARATION RECORDED JULY 21, 1992 AS FILE NO.
1992- 455805, OFFICIAL RECORDS.
DESCUR 09/06/94bh
r]
0
12863
EXHIBIT "A"
Property Description
16
GryatPoweySHOR�ReseleReatnceon
1999r
EXHIBIT "B"
City of Poway
ACKNOWLEDGMENT OF
AFFORDABLE RESTRICTIVE COVENANTS
The undersigned acknowledges as follows:
We have purchased the property at 13736 Midland Road, Poway, California.
2. There is recorded against this property a certain Option Agreement and Affordable
Housing Resale Restrictions recorded Instrument No.
( "Resale Restriction ").
3. We meet the current requirements established by the City in order to be deemed an
"Eligible Purchaser" as defined in the Resale Restriction.
d. We have read and fully understand the Resale Restriction and have had the opportunity to
ask City staff and our own attorney any questions we have about the document. We
understand that we will not be able to sell the Property for its fair market value during the
term of the Resale Restriction and that the Resale Restriction limits the price we can sell
the Property for, and how much of the equity we will be able to receive.
5. We understand that this document runs with the land and is binding on us when we
decide to transfer or sell the property, and we agree to comply fully with its terms.
OWNER(S):
Dated: ZOZE/ /' D 6 d o o e5�
Print Name: / iam J. Lauritzen
Print Name: Natsuko LaWtfzen
I
17
C ¢.ofl'owav \S I IOY\SU' oHewlcRa andmn