FARRO, RICHARD J. - Laserfiche WebLink

3.1 City of Pleasanton Homeownership Assistance Program (PHAP). One of the components of the City of Pleasanton Homeownership Assistance Program (PHAP) enacted by the City is to provide affordable housing opportunities for, among others, moderate income households who are to be offered homes for sale at prices which are below those otherwise prevailing in the market; the City intends to preserve the affordability of particular homes for moderate income households. 3.2 Resale Controls. In order to provide further assurance that the homes designated by the City for purchase by moderate income households continue to be affordable to such households, the City has established those resale controls contained in this promissory note, PHAP deed of trust, and the Resale Restriction Agreement and Option to Designate Eligible Purchaser (the "Agreement ") entered into by and between Borrower and the City on even date herewith. 3.3 Source of Funds Loaned to Borrower. In order to further assist Borrower in the purchase of the property located at 624 Palomino Drive, Pleasanton, California (the "Residence "), the City is using a portion of its Lower Income Housing Fund as the source of a loan from the City to Borrower in the amount of the original principal sum of this Note; the loan, which is evidenced by this Note, provides for the monthly payment by Borrower to the City of Simple Interest at a rate which is less than or equal to what Borrower would be required to pay pursuant to a market rate loan secured by a second mortgage or deed of trust. 3.4 Acceleration. In order to provide a means to continue to provide below market rate second mortgage financing to moderate income households and eventually to expand the amount of such financing available to such households, the outstanding principal amount of the Note, plus all accrued Interest is due and payable by Borrower to the City in the event the Residence, or any interest in it, is transferred by Borrower. For the purpose of this Section 3.4, "transfer" shall have the same meaning as is set forth in Section 2.3 herein. 3.5 The Residence. The Residence, as is commonly described as set forth in Section 3.3, above, is more fully described in Exhibit "A" attached hereto and incorporated herein by reference. The Residence is hereby designated as a Moderate Income Unit, and its purchase and any subsequent transfer shall be subject to the provisions, as applicable, of this Note. The Residence serves as security for the Deed of Trust executed in connection with this Note. - 3 -