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2. The purchase of the lots by OCHC with HOME funds shall be secured by a note <br /> from OCHC to the County and a deed of trust constituting a first lien on the property <br /> purchased which deed of trust shall designate Orange County as the secured <br /> party/beneficiary. The note and deed of trust shall be in the form of the documents <br /> that are attached to and a part of this document. Orange County agrees to <br /> subordinate its mortgage interest on each lot to private construction financing <br /> acquired by OCHC in order to complete the project. <br /> 3. OCHC agrees to contract with Arne Gray, an interested private developer, to <br /> complete improvements on the property. The improvements will consist of <br /> converting the eight (8) existing units into six (6) townhome units that can be sold as <br /> individual townhomes, and further agrees to coordinate and supervise the <br /> distribution of construction loan funds. OCHC and Orange County acknowledge <br /> that Mr. Gray was selected through a non-competitive bidding process by the <br /> Orange County HOME Consortium as the participating private partner. <br /> 4. OCHC agrees to secure financing for the construction of the project, subject to the <br /> availability of favorable financing. <br /> 5. OCHC agrees to prepare a marketing plan prior to the closing date for the purchase <br /> of the property, which will be incorporated into this document upon approval of the <br /> Orange County HOME Program Consortium. The Consortium recognizes the <br /> difficulty in determining marketing strategy, thus the plan will include activities to be <br /> undertaken by other parties. <br /> 6. Once potential purchasers are identified through marketing efforts specified in the <br /> marketing plan, OCHC will perform all activities necessary to complete the sale, <br /> including but not limited to: prequalifying the potential purchasers for a mortgage, <br /> obtaining credit information, providing homeownership education, preparing a sales <br /> contract and other necessary documents. Orange County agrees to provide legal <br /> services for preparation of townhome documents and homeowners association <br /> documents necessary to be able to sell the homes prior to the completion of <br /> construction. OCHC will fund the cost of all other legal services in the attached <br /> Project Budget from other sources, including the HOME funds. <br /> 7. In the event the townhomes constructed at Can- Court are not sold at a date 18 <br /> months from the date of closing of the purchase of the property, OCHC may elect to <br /> (a) continue to market the properties for sale to eligible buyers, or (b) attempt to <br /> secure tenants who may qualify for lease-to-purchase programs and be qualified to <br /> purchase the property within 2 years form the date of tenancy, converting the <br /> construction loans outstanding to permanent mortgages. OCHC must notify Orange <br /> County on a date 12 months from the date of the closing of the purchase of the <br /> property of its intentions in the event the townhomes are not sold by that date. <br /> 2 <br />