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CC 2014-02-11_08.c. Successor Agency Note Purchase and Sale AgreementMEMORANDUM TO: CITY COUNCIU HOUSING SUCCESSOR TO THE FORMER REDEVELOPMENT AGENCY FROM: STEVEN ADAMS, CITY MANAGER fr" SUBJECT: CONSIDERATION OF NOTE PURCHASE AND SALE AGREEMENT BY AND BETWEEN THE CITY OF ARROYO GRANDE AS HOUSING SUCCESSOR TO THE ARROYO GRANDE REDEVELOPMENT AGENCY AND META HOUSING CORPORATION DATE: FEBRUARY 11, 2014 RECOMMENDATION: It is recommended the City Council approve a Note Purchase and Sale Agreement ("Agreement") by and between the City of Arroyo Grande as housing successor to the Arroyo Grande Redevelopment Agency and Meta Housing Corporation for the City's sale of the note executed by Courtland Arroyo Grande, LP. for the loan provided toward the development of the Cortina d'Arroyo Grande senior affordable housing project. IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: The principal balance on the loan is $412,847. The accumulated interest is $99,823. If the Agreement is approved, the City will receive $200,000 eligible for low-income housing efforts. BACKGROUND: At the September 14, 2004 meeting, the City Council and Redevelopment Agency Board of Directors approved $412,847 in financial assistance for the senior affordable housing project on Courtland Street and East Grand Avenue, which was paid for from Redevelopment Agency tax increment affordable housing set aside funds. The financial assistance was structured as a loan, which is required in order to obtain the State tax credits necessary to fund the project. The loan accrues 3% simple interest per year and is payable from 50% of residual receipts. Meta Housing Corporation, the project developer, has proposed to purchase the loan at this time. The negotiated amount is $200,000. Item 8.c. - Page 1 CITY COUNCIL CONSIDERATION OF NOTE PURCHASE AND SALE AGREEMENT BY AND BETWEEN THE CITY OF ARROYO GRANDE AS HOUSING SUCCESSOR TO THE ARROYO GRANDE REDEVELOPMENT AGENCY AND META HOUSING CORPORATION FEBRUARY 11, 2014 PAGE2 ANALYSIS OF ISSUES: Since funding was intended as financial assistance and structured as a residual receipts loan, no repayment of the loan has been received and will likely not be received for many years. The Director of Administrative Services has prepared an analysis on the present value of the loan. The present value was calculated and weighed against the likelihood of interest earnings exceeding the loan's 3% simple interest rate over the remaining life of the loan (21 years), the City's current financial and housing goals, and the offer from Meta Housing. Based on the present value analysis, staff further negotiated with Meta Housing to maximize the purchase price. The purchase price of $200,000 was determined to be reasonable given that it is very close to the $221,000 present value of the loan, particularly given that it will increase the City's ability to meet current affordable housing goals. Staff also believes that obtaining funding at this time is in the best ir:1terest of the City given the State's ongoing legislative changes involving the use of former Redevelopment Agency revenues. The Agreement was reviewed by the City's redevelopment special counsel. The final Agreement includes modifications requested by the City. ALTERNATIVES: The following alternatives are provided for the Council's consideration: 1. Approve staff's recommendations; 2. Direct staff to renegotiate to determine if a higher price can be achieved; 3. Do not approve the purchase of the loan; or 4. Provide staff direction. ADVANTAGES: The recommendation will immediately provide the City with an additional $200,000 in revenues for affordable housing efforts, which will help the City fund current efforts. This will be helpful because minimal new revenues are being generated for this purpose as a result of the dissolution of the Redevelopment Agency by the State. DISADVANTAGES: The disadvantage is that the amount of funding received will likely be significantly more if the City waits for repayment, but that could be a substantial period of time. ENVIRONMENTAL REVIEW: No environmental review is required for this item. Item 8.c. - Page 2 CITY COUNCIL CONSIDERATION OF NOTE PURCHASE AND SALE AGREEMENT BY AND BETWEEN THE CITY OF ARROYO GRANDE AS HOUSING SUCCESSOR TO THE ARROYO GRANDE REDEVELOPMENT AGENCY AND META HOUSING CORPORATION FEBRUARY 11, 2014 PAGE3 PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted in front of City Hall on Thursday, February 6, 2014 and on the City's website on Friday, February 7, 2014. Attachments: 1. Note Purchase and Sale Agreement Item 8.c. - Page 3 NOTE PURCHASE AND SALE AGREEMENT This NOTE PURCHASE AND SALE AGREEMENT (the "Agreement") is made and entered into as of January_, 2014 (the "Effective Date") by and between City of Arroyo Grande, a California municipal corporation, ("Seller"), and Meta Housing Corporation, a California corporation, or its assignee ("Buyer"), with reference to the following recitals of fact: · \ . A. On or about September 14, 2004, the former Arroyo Grande Redevelopment Agency, a public body, corporate and politic ("Agency"), and Courtland Arroyo Grande, LP., a California limited partnership ("Maker") entered into that certain Second Amended and Restated Affordable Housing Agreement ("AHA"). Pursuant to the AHA, the Agency agreed to provide certain financial assistance to Maker and Maker agreed to develop and operate on certain real property identified therein as the "Site" a senior rental affordable housing development. The Site is legally described.in Exhibit "A" attached hereto and incorporated herein by reference. Pursuant to Health and Safety Code Section 34176(a), and Arroyo City Council Resolution No. 4421, Seller elected to be the "housing successor" to the Agency. B. In connection with the AHA, on or about November 1, 2004, Maker executed that certain Promissory Note (the "Note") in the original principal sum of $412,847 for the benefit of the Agency, as lender. The Note is secured by collateral, including, among other things, a security interest in the Site. C. Seller's security interests in connection with the Note and Site was initially described in the following loan documents: Deed of Trust with Assignment of Rents (Short Form), dated as of November 3, 2004 and recorded in the Official Records of the County of San Luis Obispo as Instrument Number 2004098507 (the "Original Deed of Trust"), UCC-1 Financing Statements, and Regulatory Agreement dated as of November 3, 2004 and recorded in the Official Records of the County of San Luis Obispo as Instrument Number 2004098502 (the "Regulatory Agreement"). ' D. Since the Original Deed of Trust secured the Maker's obligations under the Note, under the Regulatory Agreement, and under the AHA, in connection with this Agreement, Maker and Seller have agreed that Maker will reconvey the Original Deed of Trust on the condition that Maker execute (i) two new deeds of trust in a form substantially similar to the Original Deed of Trust, one of which will secure Maker's obligations under the Note (the "Repayment Deed of Trust"), and the other of which will secure Maker's obligations under the Regulatory Agreement and AHA (the "Performance Deed of Trust"), and (ii) a subordination agreement that provides that the Repayment Deed of Trust is a lien subordinate to that of the Performance Deed of Trust (the "Subordination Agreement"); E. Seller and Buyer each desire for (i) Seller to sell to Buyer, and Buyer-to buy from Seller, all of Seller's right, title and interest in and to the Note, (ii) Maker to execute the Repayment Deed of Trust and the Performance Deed of Trust, and (iii) Maker, Seller, and Buyer to execute the Subordination Agreement, all in accordanc~ with the terms and conditions hereof. NOW, THEREFORE, in consideration of the foregoing Recitals, which are incorporated herein by this reference, mutual covenants contained herein, and for other good 50055922.6 Item 8.c. - Page 4 and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties agree as follows: 1. Purchase and Sale; Document Execution. In accordance herewith, (a) Seller agrees to sell to Buyer, and Buyer agrees to buy from Seller, all of Seller's right, title and interest in and to the Note (collectively, the "Property"), in accordance herewith; (b) Seller agrees to reconvey the Original Deed of Trust; (c) Buyer agrees to cause Maker to execute the Repayment Deed of Trust and the Performance Deed of Trust, and (d) Seller and Buyer agree to execute, and Buyer agrees to cause Maker to execute, the Subordination Agreement. 2. Purchase Price. The purchase price for the Property shall be $200,000 (the "Purchase Price"). 3. Escrow. Promptly following the execution of this Agreement, Buyer and Seller shall open an escrow (the "Escrow") for the purchase and sale of the Property, pursuant to the terms and conditions of this Agreement, with North American Title Company ("Escrow Holder") at its office located at 2100 S.E. Main St, Suite 450 Irvine, CA 92614. Escrow shall be deemed open when Escrow Holder holds a copy or duplicate copies of this Agreement as originally executed on behalf of each of Buyer and Seller, and Escrow Holder has indicated its agreement to act in accordance herewith by executing this Agreement on behalf of Escrow Holder in the space provided. The "Close of Escrow" shall be February 28, 2014 (the "Closing Date); provided however, in the event Buyer has not obtained the Transaction Approvals (as defined in Section 8 below), Buyer shall have the right, at no additional cost and upon at least forty-eight hours prior written notice to the Seller, to extend the Closing Date by a period of time not to exceed ninety (90) days. Buyer will pay all transfer, filing and recording fees,. taxes, costs and expenses applicable to the sale of the Property to Buyer, as well as any escrow fee which may be charged by Escrow Holder. Buyer and Seller will each be responsible for its own· attorneys' fees .. 4. Deposit. Buyer shall deposit $100.00 (the "Deposit") with Escrow Holder within five (5) days after Seller's delivery of this executed Agreement to Buyer and Escrow . Holder. The Deposit shall be non-refundable to Buyer upon expiration of the "Due Diligence Period" (as defined in Section 5 below) and shall be applied to the Purchase Price at the Close of Escrow; Notwithstanding anything to the contrary set forth herein, the Deposit shall be fully refunded to Buyer if (i) Buyer elects to terminate this Agreement pursuant to an express right of termination set forth in this Agreement , (ii) there is a failure of any condition to Close of Escrow as set forth in Section 10 below , or (iii) Seller defaults in the performance of any of its obligations hereunder notwithstanding the fact that all or a portion of the Deposit may have been deemed non-refundable pursuant to this Section 4. 5. Liquidated Damages. IN THE EVENT THE SALE OF THE NOTE TO BUYER IS NOT CONSUMMATED AS A RESULT OF BUYER'S DEFAULT, SELLER, BY WRITTEN NOTICE TO BUYER, SHALL MAKE DEMAND FOR PERFORMANCE, AND IF BUYER SHALL FAIL TO PERFORM WITHIN FIVE BUSINESS DAYS AFTER DELIVERY OF SUCH DEMAND, SELLER MAY TERMINATE THIS AGREEMENT AND SELLER SHALL BE RELEASED FROM ANY AND ALL OBLIGATIONS TO SELL THE NOTE TO BUYER. BUYER AND SELLER ACKNOWLEDGE AND AGREE THAT FIXING SELLER'S ACTUAL DAMAGES IN THE EVENT OF BUYER'S DEFAULT WOULD BE EXTREMELY DIFFICULT OR IMPRACTICABLE TO DETERMINE. THEREFORE, IN THE EVENT OF BUYER'S DEFAULT OF ITS OBLIGATION UNDER THIS AGREEMENT, THE PARTIES HAVE AGREED, AFTER NEGOTIATION, THAT THE DEPOSIT AND ANY INTEREST ACCRUED THEREON SHALL 50055922.6 2 Item 8.c. - Page 5 CONSTITUTE SELLER'S SOLE AND EXCLUSIVE RIGHT TO DAMAGES AND THAT THIS SUM REPRESENTS A REASONABLE ESTIMATE OF THE ACTUAL DAMAGES SELLER WOULD INCUR IN THE EVENT OF BUYER'S DEFAULT OF ITS OBLIGATION TO PURCHASE THE PROPERTY. SELLER WAIVES ANY RIGHT TO SPECIFIC PERFORMANCE OR DAMAGES OTHER THAN AS SET FORTH IN THIS SECTION. BY INITIALING IN THE SPACES WHICH FOLLOW, SELLER AND BUYER SPECIFICALLY AND EXPRESSL YAGREE TO ABIDE BY THE TERMS AND PROVISIONS OF THIS SECTION 5 GOVERNING LIQUIDATED DAMAGES. 6. Due Diligence Period; Inspection and Access. (a) Due Diligence Period. The "Due Diligence Period" shall mean the period-beginning on the Effective Date, and ending on that date which is thirty (30) calendar days thereafter; provided, however, that in no event shall the Due Diligence Period extend beyond the Closing Date. (b) Due Diligence Investigation. Buyer shall conduct its investigation of the Property during the Due Diligence Period. To facilitate Buyer's review, within 5 days after the Effective Date, Seller shall make available for Buyer's review at Seller's office, Seller's complete loan file with respect to the Note, including, without limitation, any of the following documents to the extent in Seller's possession: title insurance policy and endorsements, corporate or partnership documents, estoppel letters from Maker, operating reports, environmental reports, site plans, surveys, soil and substrata studies, architectural drawings, plans, and specifications, engineering plans and studies, floor plans, landscape plans, external written correspondence, insurance certificates or policies, appraisals (collectively, the "Property Documents"). This investigation (the "Due Diligence Investigation") may include review of such matters pertaining to an investment in the Property as Buyer deems advisable in its sole and absolute discretion. · (c) Approval/Disapproval of Due Diligence Investigation. During the Due Diligence Period, Buyer may terminate this Agreement for any or no reason in Buyer's sole and absolute discretion upon written notice to Seller and the Escrow Holder whereupon if funded, the Deposit and any interest accrued thereon shall be promptly returned to Buyer without the need for further instructions to do so. If Buyer approves of the results of its Due Diligence Investigation, in the exercise of Buyer's sole and absolute discretion, then Buyer shall deliver written notice (the "Approval Notice") to Seller and Escrow Holder no later than the expiration of the Due Diligence Period. If Buyer fails to deliver the Approval Notice to Seller and Escrow Holder prior to the expiration of the Due Diligence Period, then Buyer shall be deemed to have disapproved the results of its Due Diligence Investigation, whereupon this Agreement shall terminate, the Deposit (to the extent funded) and any interest accrued thereon shall be promptly returned to Buyer, and this Agreement shall be of no further force and effect and the parties shall have no further obligations to one another arising out of this Agreement. 7. Title Insurance. Escrow Holder shall cause North American Title Company ("Title Insurer") to issue as of the date of the Close of Escrow an AL TA Extended Coverage Lender's Title Insurance Policy and any endorsements required by Buyer issued by a title insurance company designated by Buyer in the amount of the Purchase Price, in content satisfactory to Buyer, insuring that Maker holds fee title to the Site and that the Repayment Deed of Trust is a lien on the Project with no exceptions other than those accepted by Buyer in 50055922.6 3 Item 8.c. - Page 6 writing ("New Title Policy"). At the Close of Escrow, Buyer shall pay the premium for the New Title Policy. 8. Representations and Warranties. (a) Seller represents and warrants to Buyer as follows: (1) To Seller's actual knowledge, the Note has not been modified, supplemented or amended in any way; (2) Seller has not assigned, hypothecated or otherwise transferred all or any portion of its interest in either or both of the Note or the Original Deed of Trust, and Seller is the holder of the Note; (3) To Seller's actual knowledge, Seller has all requisite power and authority to execute and deliver this Agreement, and to perform all of its obligations under this Agreement and under all instruments and other documents to be executed and delivered by Seller in connection herewith. (4) To Seller's actual knowledge, this Agreement when executed by Seller and Buyer will be a valid and binding obligation of Seller, enforceable in accordance with its terms except as the same may be limited by bankruptcy, insolvency, reorganization, or similar laws or general principles of equity affecting creditors' rights generally. (5) Seller has not engaged any broker or finder, or incurred or become obligated to pay any broker's commission or finder's fee, in connection with the transactions contemplated by this Agreement. (6) The Note attached as Exhibit "B" is a true, correct and complete copy of the Note; (7) As of the date hereof, the outstanding principal balance on the Note is $412,847. As used herein, the phrase "actual knowledge" shall mean the actual knowledge of the City Manager of Seller, without any duty of inquiry or investigation. (b) Buyer hereby represents and warrants to Seller, as follows: (1) As of the expiration of the Due Diligence Period, Buyer has conducted such due diligence, investigation, and inquiry as Buyer deemed necessary and appropriate to the transactions contemplated by this Agreement, and, in entering into this Agreement, Buyer is relying solely upon its own due diligence, investigation, and inquiry; (2) Buyer has been advised by counsel of Buyer's choosing of the conditions and limitations imposed by law upon holders of obligations secured in whole or in part by real property and/or personal property, and understands the effects of judicial and non- judicial foreclosure on the rights of holders of obligations secured by real and personal property, including as to junior priority obligations and residential real property; (3) This Agreement constitutes a valid and binding obligation 50055922.6 4 Item 8.c. - Page 7 of Buyer to Seller enforceable in accordance with its terms; ( 4) The execution and delivery by Buyer of this Agreement, and consummation of the transactions contemplated herein, will not, with or without giving of notice or passage of time, or both: (i) conflict with or violate any law, statute, rule, regulation, or administrative order to which Buyer is subject, or by which Buyer's assets are bound or affected; (ii) violate any judgment, order, writ, or decree of any court or administrative body in any suit or proceeding to which Buyer is a party; (iii) result in a breach of, or default under, any material agreement, commitment, contract (written or oral), or other material instrument, to which Buyer is a party or by which any of Buyer's assets are bound or affected; or (iv) render Buyer insolvent or without sufficient working capital; (5) There are no actions, suits, claims, proceedings, or investigations, pending or threatened against Buyer which might impair the consummation of the terms and conditions of this Agreement; (6) Buyer has been duly-formed, is validly-existing, and in good standing in the state in which it was organized. Buyer has the requisite legal capacity to enter into and consummate the transactions contemplated by this Agreement; and (7) As of the Closing Date, Buyer shall have obtained all approvals necessary or required to enter into this Agreement and consummate the transactions contemplated hereby (collectively, the "Transaction Approvals"). (c) The representations and warranties contained in this Paragraph 8 shall be true upon execution of this Agreement, and shall be deemed to be repeated at and as of the Close of Escrow, and shall survive the Close of Escrow for a period of three (3) months. 9. Documents at Closing. In furtherance of the transaction described herein: (a) Buyer shall (i) cause Maker to execute, and cause to be acknowledged and delivered to Buyer, through Escrow, the Repayment Deed of Trust, (ii) cause Maker to execute, and cause to be acknowledged and delivered to Seller, through Escrow, the Performance Deed of Trust, and (iii) execute, cause Maker to execute, and cause to be acknowledged and delivered to Seller, through Escrow, the Subordination Agreement. (b) Seller shall (i) execute, and cause to be acknowledged and delivered to Escrow, a reconveyance of the Original Deed of Trust (the "Reconveyance"), (ii) execute, and cause to be acknowledged and delivered to Seller, through Escrow, the Subordination Agreement, and (iii) deliver into Escrow the original Note endorsed to Buyer. 10. Covenants of Seller. (a) So long as this Agreement remains in effect, without the prior written consent of Buyer (which consent shall not be unreasonably withheld), Seller and Maker will not modify, amend, cancel, extend, release, waive, or otherwise change in any manner any of the material terms, covenants, conditions, or obligations as set forth in the Property. Without the prior written consent of Buyer, Seller and Maker shall not cause any new subordination of the Original Deed of Trust or the release of any security for the Note. (b) Upon acquiring actual knowledge thereof, Seller shall promptly 50055922.6 5 Item 8.c. - Page 8 notify Buyer of the institution or pendency of any action, suit, or proceeding against or affecting the Property and shall deliver to Buyer copies of all notices and other writings relating to such actions promptly upon receipt thereof. (c) Upon acquiring actual knowledge thereof, Seller shall promptly notify Buyer of the institution or pendency of any action, suit, or proceeding against or affecting the Property and shall deliver to Buyer copies of all notices and other writings relating to such actions promptly upon receipt thereof. (d) Prior to the Close of Escrow, Seller shall not transfer, assign, sell, convey, hypothecate, or otherwise alienate (collectively, "transfer") the Note or negotiate or attempt to negotiate the transfer, assignment, sale, conveyance, hypothecation, or other alienation of the Note. (e) Seller refrain from soliciting, considering or accepting other proposals with respect to the Note and/or the Site, and deal exclusively with the Buyer until the expiration of the Closing Date, or any mutually agreeable extension thereof. 11. Conditions to Seller's Obligations. The obligations of Seller to consummate the transactions contemplated by this Agreement are, in addition to tlie other terms and conditions of this Agreement, subject to the conditions set forth in this Section, each of which is for the sole benefit of Seller, and any one or more of which may be waived in whole or in part by Seller in its sole discretion. (a) Seller shall have reconveyed the Original Deed of Trust and Maker shall have executed the Repayment Deed of Trust and the Performance Deed of Trust, and Maker and Buyer shall have executed the Subordination Agreement. (b) The representations and warranties of Buyer contained in this Agreement shall be true on and as of the Closing Date as if the same were made on and as of the Closing Date. (c) Price (less the Deposit). Buyer shall have deposited with Escrow Holder the Purchase (d) Buyer shall have executed and deposited with Escrow Holder all of the documents required to be executed by Buyer pursuant to the terms of this Agreement. (e) Buyer shall have fully and timely performed, in all material respects, all covenants and obligations required by this Agreement to be performed by Buyer on or prior to the Closing Date. (f) Buyer shall not have dissolved or become a party to any merger, consolidation, reorganization, or capitalization, or be the subject of any bankruptcy or insolvency proceeding, whether voluntarily or involuntarily. 12. Closing. (a) Escrow Holder shall close the transaction described herein when and only when: 50055922.6 6 Item 8.c. - Page 9 ( 1) Escrow Holder holds and is ready to record the Reconveyance, Repayment Deed of Trust, Performance Deed of Trust, and Subordination Agreement; (2) (3) to Buyer the New Title Policy; Escrow Holder holds the original Note endorsed to Buyer; Escrow Holder is prepared to issue, or cause to be issued, (4) Escrow Holder holds the Purchase Price for Seller's account; (5) Escrow Holder holds such amounts as are required of Buyer for its estimated share of closing costs as set forth in Paragraphs 3 and 6 hereof; and (6) Escrow Holder is prepared to strictly comply with these instructions and Buyer and Seller have otherwise complied with the terms of this Agreement. (b) Then and only then Escrow Holder is instructed to record the Reconveyance, Repayment Deed of Trust, Performance Deed of Trust, and Subordination Agreement in the Official Records of San Luis Obispo County, California. (c) Upon the Close of Escrow, Escrow Holder shall do the following: ( 1 ) calculate Buyer's closing costs described in Paragraphs 3 and 4 hereof; (2) obtain and deliver, or cause the Title Insurer to deliver, the New Title Policy to Buyer; (3) deliver to Buyer a recorded copy of the Repayment Deed of Trust; I (4) deliver to Buyer the original Note and the original Repayment Deed of Trust; (5) previously released to Seller); deliver to Seller the Purchase Price (less the Deposit if (6) deliver to Seller a recorded copy of the Performance Deed of Trust and Subordination Agreement; (7) and Subordination Agreement; deliver to Seller the original Performance Deed of Trust (8) deliver Escrow Holder's closing statement, along with a copy of all closing documents, to each of Seller and Buyer. 13. General Provisions. (a) This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof, and no prior or contemporaneous negotiation 50055922.6 7 Item 8.c. - Page 10 or agreement, whether written or oral, shall have any effect. No claim, waiver, modification, consent or acquiescence with respect to any of the provisions of this Agreement shall be made against either party hereto except on the basis of a written instrument duly executed by or on behalf of such party. Each party may elect to waive in writing any or all of the conditions herein contained in favor of such party. (b) This Agreement shall be governed and construed in accordance with the laws of the State of California (c) Except for the expenses and fees which are specifically allocated herein, any expenses incurred in connection with this transaction shall be borne by the party incurring such expense. (d) Time is of the essence hereunder. ( e) The headings of the paragraphs of this Agreement are inserted solely for convenience, and shall not be considered in interpreting the provisions hereof. (f) This Agreement may be executed in any number of identical counterpart documents, each of which shall constitute a separate original document, and all of which together shall constitute one instrument. (g) If either party hereto shall file any action or bring any proceeding against the other party arising out of this Agreement or for the declaration of any rights hereunder, the prevailing party therein (as such party is determined by a court, an arbitrator or by settlement) shall be entitled to recover from the other party all costs and expenses, including reasonable attorneys' fees incurred by the prevailing party and any expert witness fees. Such attorneys' fees shall be deemed to have accrued on the commencement of such action or proceeding and shall be paid whether or not such action is prosecuted to judgment. (h) Each party hereto shall, promptly upon the request of the other or Escrow Holder, have acknowledged, if appropriate, and delivered to the other any and all further instruments and assurances reasonably requested or appropriate to evidence or give effect to provisions of this Agreement or to satisfy Escrow Holder's requirements. (i) This Agreement shall apply to the parties hereto according to the contents hereof, and without regard to the number or gender of words or expressions used herein. All amounts due or to be paid in accordance herewith shall be construed to be paid with currency of the United State of America. [remainder of page intentionally blank] 50055922.6 8 Item 8.c. - Page 11 IN WITNESS WHEREOF, Seller and Buyer have entered into this Agreement as of the day and year first above written. SOOSS922.6 9 "SELLER" CITY OF ARROYO GRANDE, a California municipal corporation By: Name: ·~~~~~~~~~~~~~- Its: "BUYER" META HOUSING CORPORATION, a California By: Name: ·~~~~~~~~~~~~~- Its: Item 8.c. - Page 12 CONSENT OF ESCROW HOLDER The undersigned Escrow Holder agrees to (i) accept the foregoing Agreement, (ii) be escrow agent under the Agreement for the fees therein specified, and (iii) be bound by the Agreement in the performance of its duties as escrow agent; however, the undersigned will have no obligation, liability or responsibility under (i) this consent or otherwise, unless and until the Agreement is fully signed by the parties and has been delivered to the undersigned, and (ii) any amendment to the Agreement, unless and until the amendment is accepted by the undersigned in writing. NORTH AMERICAN TITLE COMPANY By: Its: 50055922.6 10 Item 8.c. - Page 13 50055922.6 EXHIBIT"A" Legal Description (to be attached) Item 8.c. - Page 14 50055922.6 EXHIBIT"B" Promissory Note (to be attached) Item 8.c. - Page 15 THIS PAGE INTENTIONALLY LEFT BLANK Item 8.c. - Page 16