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Form O: ly <br />Appraisal Method. <br />Exhibit A <br />to Performance Deed of Trust <br />City or its designee shall have an appraisal made by a neutral professional appraiser of its choice <br />to establish the market value. The Owner may also have an appraisal made by a neutral professional <br />appraiser of Owner's choice to establish the market value. If agreement cannot be reached, the average of <br />the two appraisals shall be deemed to be the market price. This requirement for an appraisal may be <br />waived by the City if, in the exercise of its judgment, the appraised value will be substantially higher than <br />the price determined in subsection 11(b) below. <br />b. Base Price Method. <br />The purchase price paid by Owner plus the amount of any prepayment fees paid by the Owner - <br />Seller at the time said Owner purchased the Premises ("base price"), plus the lesser of either (i) the rate of <br />increase of Area Median Income during the seller's ownership; or (ii) any increase in the housing <br />component of the San Francisco -Oakland metropolitan area Consumer Price Index as published <br />periodically by the United States Department of Housing and Urban Development (hereinafter the "Index"). <br />For that purpose, the Index prevailing on the date of the purchase by the Selling Owner of said Premises <br />shall be compared with the latest Index available on the date of receipt by City of notice of intent to sell. <br />The percentage increase in the index, if any, shall be computed and the base price shall be increased by <br />that percentage. Owner understands and agrees that Owner shall sell the Property at the deed restricted <br />price or at a lower price if market conditions dictate that the Property must be sold at a lower price than the <br />deed restricted price. <br />In no event shall City become in any way liable to Owner, nor become obliged in any manner, by <br />reason of the assignment of City's right to purchase, nor shall City be in any way obligated or liable to <br />Owner for any failure of City's assignee to consummate a purchase of the premises or to comply with the <br />terms of any purchase and sale agreement. <br />12. Adjustments to Base Resale Price. Subject to the Affordable Housing Cost restriction <br />described in subsection (d) below, the Base Resale Price shall be increased or decreased, as applicable, <br />by the following adjustment factors ("Adjustment"): <br />a. Capital Improvements. An increase for capital improvements made to the <br />Property by Owner, but only if the amount of said improvements had been previously accepted in writing by <br />the City after original written documentation of the cost was provided to the City for verification. The amount <br />of the Adjustment shall equal the original cost of any such capital improvements depreciated on a straight- <br />line basis based upon the estimated useful life of the improvement stated in the City's prior written <br />acceptance of said improvement. <br />b. Damages. A decrease by the amount necessary to repair damages to the <br />Property, if any, and to place the Property into saleable condition as reasonably determined by the City, <br />including, without limitation, amounts attributed to cleaning; painting; replacing worn carpeting and <br />draperies; making necessary structural, mechanical, electrical and plumbing repairs; and repairing or <br />replacing built-in appliances and fixtures. <br />783016-2 112310 18 <br />