HOUSE - PROMISSORY NOTE - SECURED BY SECOND DEED OF TRUST

Transfer of the Property. Subject to Section 22, if all or any of the Property or an interest in it is sold or transferred by Borrower, excluding permitted transfers to a spouse or other person signing the Note in the manner described in Section 5 above, all the sums secured by this Deed of Trust shall be immediately due and payable. In the event of such an acceleration, Lender shall mail Borrower notice of the acceleration in accordance with Section 16 hereof. Such notice shall provide a period of not fewer than 30 days from the date the notice is mailed within which Borrower may pay the sums declared due. If Borrower fails to pay such sums prior to the expiration of such period, Lender may, without further notice of demand on Borrower, invoke any remedies permitted by Section 20 hereof. 6.0 Nonrecourse. This Note constitutes a portion of the purchase price of the Residence. Borrower shall have no personal liability for any deficiency on this Note and the only remedy available to the City or any holder in due course shall be foreclosure pursuant to law as provided in the Deed of Trust securing this Note. The City may assign its right to receive the proceeds under this Note to any person and upon notice to Borrower by the City all payments shall be made to the assignee. 7.0 Controlling Law. The provisions of this Note shall be interpreted under the laws of the State of California. BORROWER: Housing Options Utilizing Supportive Environments HOUSE, Inc.), a California Nonprofit Public Benefit Corporation By: ~f .,, ~ ~.! ~vtti-A-c~ ~ t-~ ou S ~ r~ c B3,; HINCPRNT.SAM 01/13/97