RecDoc 2020-115102 Addendum to Loan Agmt

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and conditions set forth in the City Documents, and that it will continue to own the Property throughout the HOME Affordability Restriction Period. 2. Use of HOME Funds; Project Budget; Disbursement of HOME Funds. Pursuant to the Loan Agreement, the City agreed to provide the HOME Funds, the CDBG Funds, and the City Funds for the purpose of assisting Owner to acquire the Property for its continued operation as an affordable multi -family residential rental project. Owner hereby represents and warrants that the HOME Funds, the CDBG Funds, and the City Funds have been used solely for such purpose consistent with the Loan Agreement and consistent with all requests for disbursement submitted to City pursuant to the Loan Agreement. Additional description of the Project, including other sources of financing and the Project budget, are set forth in Section 2 of Exhibit A of the Loan Agreement. 3. Use and Affordability Restrictions. Owner hereby covenants and agrees, for itself and its successors and assigns, that throughout the General Affordability Restriction Period, the Property shall be used solely for the operation of an affordable multifamily rental housing development in compliance with the City Documents. 3.1.1 HOME Unit. Throughout the (10) ten -year HOME Affordability Restriction Period, one (1) two-bedroom unit in the Project shall be a HOME Unit and shall be subject to the affordability and occupancy requirements of the HOME Program. The HOME Unit shall be a ["fixed unit."] The HOME Unit shall be restricted for occupancy by Eligible Households who qualify, as Very Low -Income Households, and rent for the HOME Unit shall be restricted to Low HOME Rent. For purposes of calculating allowable rents for the HOME Unit, imputed household size shall be 1.5 persons per bedroom. Following the HOME Affordability Restriction Period, the HOME Unit is required to be occupied or available for occupancy, by Low -Income Households at Affordable Rent for the remaining 45 years of the General Affordability Restriction Period. 3.1.2 Additional Residential Units. Subject to the provisions of Section 3.I.1 which describes additional restrictions that apply to the HOME Unit during the HOME Affordability Restriction Period, throughout the General Affordability Restriction Period, all residential units in the Project shall be occupied (or if vacant, available for occupancy) by Low -Income Households at Affordable Rent. 3.1.3 Recapture. As set forth in Section 3 of Exhibit A of the Loan Agreement, if the Property ceases to be used for the purposes described in the Loan Agreement and this Agreement, and such default is not cured within 60 days following receipt of notice of default, upon City's written demand, Owner shall be obligated to repay the Loan. 3.1.4 Initial Rents; Rent Increases. City shall annually provide Owner with a schedule of permitted rents for the HOME Unit and the additional residential units in the Project. 3.1.5 No Condominium Conversion Occupancy as Principal Residence; No Short-term Rentals. Owner shall not convert the residential units in the Project to condominium or cooperative ownership or sell condominium or cooperative rights to the residential units in the REV: 08-26-2020 PR ATTY/AGR.2020.168/HIP Housing Development Corporation (Page 5 of 31)