CASA BELLA

PURCHASE AND SALE AGREEMENT,

ESCROW INSTRUCTIONS, AND RECEIPT FOR DEPOSIT

(A Condominium Project)

SELLER: TERRA BELLA TLG, LLC. A CALIFORNIA LIMITED LIABILITY COMPANY

BUYER:

PROPERTY DESCRIPTION: Unit _____________ of Tract No. 61812, 14444 Terra Bella St, City of Los Angeles, County of Los Angeles.

PURCHASE PRICE AND PAYMENT:

PURCHASE PRICE: $____________________________

DEPOSIT ACCOMPANYING

PURCHASE AGREEMENT: $____________________________

(Check No. _____________)

LOAN AMOUNT: $____________________________

BALANCE OF CASH DOWN PAYMENT (Obtaining deposit, down payment and closing costs is not a contingency to purchase) :

Balance of Cash Down Payment $____________________________

TOTAL ESTIMATED CASH DUE FROM BUYER PRIOR TO CLOSE OF ESCROW $____________________________

FINANCING: (Initial One)

__________ FINANCING REQUIRED. Buyer will apply, qualify for, and obtain financing sufficient to close Escrow in the approximate loan amount above in the manner set forth in herein below.

__________ FINANCING NOT REQUIRED. Buyer will provide all cash to close Escrow without obtaining a loan.

Date Received in Escrow ("Opening Date"): _______________________________

"Scheduled Closing Date": _______________________________

Pre-qualifying Lender: _______________________________

TOPIC LIST

1. Covenants for Purchase and Sale

2. Property Description

3. Purchase Price and Payment

A. Purchase Price

B. Deposit Accompanying Purchase Agreement

C. Loan Amount

D. Balance of Cash Down Payment

E. Financing

F. Escrow

4. Definitions

5. Closing Costs

6. Escrow/Title Company

A. Opening

B. Fees and Costs

C. Authorized Disbursements

D. Prorations

E. Supplemental Taxes

F. Homeowners Association Assessments

G. Insurance Premium Proration

7. Removal of Contingencies

8. Nuisances

9. Financing

A. Loan Application

B. Loan Approval

C. Verification of Funds

D. Loan Locks and Commitments

E. Purchase Money Second Deed of Trust

F. Accuracy of Information

10. Government Assisted Financing

11. Final Funds

12. Conditions to Close of Escrow

13. Title

14. Close of Escrow

15. Environmental Disclosures

A. No Guarantees Regarding Resale, Views, Traffic, Schools or Future Development; Additional Disclosures

B. Urban Impacts

C. Mold and Mildew

D. Disclosure of Changed Conditions

E. Smoke Detector Statement of Compliance

F. Water Heater Strapping

G. Additional Disclosures

16. Data Base Notice and Disclaimer

A. Notice

B. Seller Disclaimer

C. Buyer Representation, Acknowledgment and Option to Repurchase

17. Construction Disclosures

18. Changes in Price, Product, Development Plan and Marketing Methods

19. New Home Universal Design Checklist, Options and Upgrades

A. New Home Universal Design Checklist

B. Additional Custom Features, Options and Upgrades

20. Inspections and Walkthroughs

21. Limited Warranties for New Construction

A. Limited One-Year Warranty for Fit and Finish Items

B. Notice and Opportunity to Cure

C. Insulation

D. Sound Transmission

22. Entry upon Property; Buyer Improvements

23. Termination by Seller

A. Termination Without Default of Buyer

B. Upon Buyer’s Default

C. Seller’s Termination Notice

24. Cancellation of Sale

25. Liquidated Damages

26. Arbitration of Disputes

27. Alternative Dispute Resolution Procedure

A. Scope and Purpose

B. No Right to Trial

C. Mediation - Disputes Other than Construction Defects

D. Procedures for Resolution of All Disputes - Judicial Reference, Judgment and Appeal

i. Submission to Judicial Reference

ii. Inclusion of Necessary Parties

iii. Sharing of Costs and Fees

iv. Authority and Qualifications of Referee

v. Timeliness of Reference Proceedings

vi. Reference Venue and Procedures

vii. Discovery

viii. Motions

ix. Duty to Mitigate and to Maintain; Limitation on Remedies

x. Statement of Decision

xi. Judgment and Appeal

E. Additional Procedures for Resolution of Construction Defect Disputes (SB-800)

i. Contractual opt-out Pre-Litigation Procedures for Construction Defect Disputes

ii. Notification to Seller of Claim

iii. Seller’s Rights of Inspection

iv. Offer to Repair

v. Judicial Reference

vi. Duty to Mitigate and to Maintain; Limitation on Remedies

vii. Application of Award

28. General Provisions

A. Modification; Waiver

B. Severability

C. Construction

D. Governing Law

E. Notices

F. Entire Agreement/No Representations

G. Interpretation

H. Not a Loan Application or Commitment

I. Agency/No Representations

J. Counterparts

K. Survival

L. Time of Essence

M. Headings

N. Foreign Language

29. Buyer’s Acknowledgment and Effectiveness of Agreement

Execution Pages

Addendum A: Additional Escrow Instructions

Addendum B: California Department of Health Services Mold Information Sheet

Addendum C: California Civil Code Sections 895 - 945.5 ("SB 800")

Addendum D: One-Year Limited Warranty for Fit and Finish Items

Addendum E: New Home Universal Design Checklist (AB 1400)

THIS IS AN OFFER FROM ___________________________________________________________________________ ("Buyer")(Full Name(s) and vesting as Title is to Be Taken) for the purchase of the Property hereinafter described, for the purchase price ("Purchase Price"), and upon the terms and conditions more particularly set forth herein ("Agreement") and is not a binding agreement until executed by Seller.

THE MANNER OF TAKING TITLE MAY HAVE SIGNIFICANT LEGAL AND/OR TAX CONSEQUENCES. BUYER IS ENCOURAGED TO DISCUSS THIS SUBJECT WITH THE BUYER’S LEGAL AND/OR TAX ADVISOR. If the vesting of title will be different from that which is indicated herein, Buyer shall notify Escrow Holder and Seller in writing not more than ten (10) days after the execution of this Agreement by Buyer.

1. COVENANTS FOR PURCHASE AND SALE. Buyer agrees to purchase, and Seller agrees to sell to the Buyer, the Property described in this Agreement.

2. PROPERTY DESCRIPTION. The Property that is the subject of this Purchase Agreement is described as the condominium ("Popery") consisting of (i) Unit , located at 14444 Terra Bella St, City of Los Angeles, County of Los Angeles[, and any appurtenant exclusive use common areas (if any); and (ii) an undivided 1/26 interest in the common area as described in the Declaration of Covenants, Conditions, and Restrictions and Condominium Plan recorded against the Project that is on Lot 1 of Tract No. 61812, of said City and County].

3. PURCHASE PRICE AND PAYMENT. Buyer agrees to pay the following Purchase Price as consideration for the purchase of the Property. Some of the amounts listed below are estimates only and are subject to change based upon the actual costs involved. The Purchase Price may increase if Buyer purchases optional items or changes. All amounts listed below shall be paid into Escrow prior to the Close of Escrow, except as otherwise provided for herein.

A. PURCHASE PRICE: $____________________________

B. DEPOSIT ACCOMPANYING PURCHASE AGREEMENT: $____________________________ (Check No. _____________)

C. LOAN AMOUNT: $____________________________

D. BALANCE OF CASH DOWN PAYMENT (Obtaining deposit, down payment and closing costs is not a contingency to purchase):

i. Balance of Cash Down Payment $____________________________

ii. TOTAL ESTIMATED CASH DUE FROM BUYER PRIOR TO CLOSE OF ESCROW $____________________________

E. FINANCING: (Initial One)

____________ FINANCING REQUIRED. Buyer will apply, qualify for, and obtain financing sufficient to close Escrow in the approximate loan amount above in the manner set forth in herein below.

____________ FINANCING NOT REQUIRED. Buyer will provide all cash to close Escrow without obtaining a loan. r t

F. ESCROW: Escrow Holder is ______________________________________, a licensee of the California Department of Corporations, ______________________________, California, ________, telephone (_____)_______________, facsimile (_____)_______________.

The parties hereto understand and acknowledge that the duties of the escrow agent are limited solely to the specific provisions incorporated in these escrow instructions. Functions that would normally be handled by a real estate licensee, including but not limited to preparing purchase agreement and disclosures ordering reports and inspections, representing the physical conditions of improvements and property, etc. shall all be the total responsibility of the principals to this transaction. Escrow Holder cannot give legal advice to any party hereto. The agency and duties of the Escrow Holder commence only upon receipt of these Escrow Instructions executed by all parties.

Date Received in Escrow ("Opening Date"): _____________________________

"Scheduled Closing Date": _____________________________

Pre-qualifying Lender: _____________________________

"Loan Approval Date": _____________________________

Buyer’s Deposit shall be placed in a non-interest bearing account with Escrow Holder, unless specific written instructions are entered into between Escrow Holder and Buyer regarding placement of Buyer’s Deposit into an interest bearing account, costs of which shall be paid by Buyer.

4. DEFINITIONS.

"Alternative Dispute Resolution" - Resolution of disputes arising before or after close of escrow for which the parties have waived their rights to trial by jury or by a judge and agree to resolve disputes by non-trial procedures specified in this agreement.

"Authorized Disbursements" - The funds Buyer authorizes Escrow Holder to disburse to third parties from Buyer’s Deposit, which include the following: loan application; credit report; Buyer’s portion of Escrow fees and services, including cancellation charges; preliminary title report charges in the event that Escrow is canceled; appraisal fees, and any costs and fees associated with processing of Buyer’s loan.

"Close of Escrow" - The day that the grant deed transferring title to the Property to Buyer is recorded or filed in the office of the Official Records of the County Recorder in which the Property is located.

"Closing Costs" - Costs of closing this escrow, described herein.

"Date of Acceptance" - The date on which Buyer’s offer to purchase the Property is accepted by Seller.

"Escrow" - The Escrow described below.

"Escrow Holder" - The Escrow company to which these instructions are directed. Escrow Holder is a neutral party not affiliated with either the Buyer or Seller.

"Homeowners Association" - the association of homeowners formed to govern the Project.

"Lender" - Lender(s) from whom Buyer has elected to obtain the Loan(s).

"Lender Approval" - The formal approval of the Loan to Buyer by Lender.

"Loan" - The first and/or second trust deed loan, if any, obtained by Buyer.

"Project" - The real estate development in which the Property is located.

"Residence" or "Unit" - The residential condominium which is the subject of this Purchase Agreement "Total Purchase Price" - The amount indicated above as Purchase Price of the Property, together with Purchase Price of any extra or option items subsequently purchased by a separate document executed by Seller and Buyer, which is deposited in Escrow and made a part hereof. "Title Company" - The company chosen by Seller, in its sole discretion, to provide Buyer standard coverage title insurance. Seller reserves the right to change Escrow and/or the Title Company.

5. CLOSING COSTS. Reasonable and necessary closing costs to be paid by Buyer include, but are not limited to: extended coverage fire and liability insurance; tax prorations; the following loan

fees and costs: commitment, Escrow, sub-Escrow, notary, appraisal, credit report, loan, processing, impounds; loan tie-in fees; prepaid interest; homeowner assessments; capital contributions (if any); insurance premiums; tax service; trust deed recordation; ALTA lender’s policy; and other ordinary charges and prorations incurred, payable on or before Close of Escrow ("Closing Costs").

Buyer acknowledges that Closing Costs, Prorations, and Authorized Disbursements, may vary from any of the amounts set forth. Seller and its representatives make no representations as to the actual, final costs to be paid by Buyer. Buyer should consult their Lender to ascertain Closing Costs associated with Buyer’s loan, which may vary substantially.

6. ESCROW/TITLE COMPANY.

Explanation of this section: An escrow company or "escrow holder" is the agent of both the buyer and seller fo the purpose of allowing those two parties to simultaneously exchange all the necessary money, deeds and other documents to complete the purchase and sale of a house orcondominium. You, as buyer, and seller together instuct the escrow company what you both want done. The gathering of the necessary items is called an "escrow" and usually begins when the escrow company receives your deposit and escrow instructions from both parties. "Closing" is the usual term for completing the exchange. In this transaction, the escrow instructions are combined with the purchase agreement. One of the asks of the escrow company is to apportion taxes, governmental fees and homeowner association assessments connected with the closing of escrow.

A. OPENING: An Escrow shall be opened within seven (7) days following acceptance of this Purchase Agreement by Seller, with the Escrow Holder designated herein. The general Escrow instructions to Escrow Holder are attached hereto as Addendum "A", which general instructions, together with this Agreement, shall constitute Buyer’s and Seller’s instructions to Escrow Holder. Escrow Holder shall not be responsible for the obligations of Seller and Buyer under this Agreement.

In the event Seller, Escrow Holder, or Buyer’s Lender require separate or additional instructions, Buyer agrees to join in such Escrow by executing and depositing such Escrow Instructions with Escrow Holder within five (5) working days of receipt of the forms provided by the Escrow Holder.

Failure of Buyer to timely execute Escrow instructions or other required documents within two (2) days of receipt, shall constitute a material default hereunder, entitling Seller, at its option, to cancel and terminate this Purchase Agreement by providing written notice to Buyer and instructing Escrow Holder to return to Buyer the Deposit. Upon such cancellation, Seller shall not have any further obligation or liability to Buyer.

B. FEES AND COSTS: Seller shall pay for the following fees and costs: standard policy of title insurance; costs of recording the grant deed; documentary transfer taxes; and one-half of the Escrow fee normally charged by Escrow Holder to Seller. Buyer shall pay: Buyer’s Closing Costs, the Authorized Disbursements, and one-half of the Escrow fee charged by Escrow Holder.

C. AUTHORIZED DISBURSEMENTS: Buyer hereby authorizes Escrow Holder to release and pay from Buyer’s Deposit the Authorized Disbursements, as follows:

(i) The cost of a loan application credit report, estimated to be: $_________________

(ii) The cost of Escrow services, estimated to be: $_________________ r r t

(iii) The cost of a preliminary title report, estimated to be: $_________________

(iv) The cost of an appraisal fee, estimated to be: $_________________

(v) The cost of a loan processing fee, estimated to be: $_________________

TOTAL ESTIMATED AUTHORIZED DISBURSEMENTS: $_________________

D. PRORATIONS: Taxes, assessments, Homeowners Association dues and expenses, insurance (if any), and interest (if any), shall be prorated based upon the latest available bills as of the Close of Escrow, using a thirty (30) day month. Buyer understands that estimated taxes and/or costs of insurance may increase or decrease, depending upon fluctuations in real property taxes or insurance rates. Buyer shall pay the assessments for any assessment district in which the Property is located.

E. SUPPLEMENTAL TAXES: Buyer is aware that the Property may be reassessed upon change of ownership. This may affect the taxes to be paid. A Supplemental Tax Bill may be issued by the County Tax Assessor, which shall be paid as follows: (a) for periods after Close of Escrow, by Buyer (or by final acquiring Party if this transaction is part of an exchange), and (b) for periods prior to Close of Escrow, by Seller. In the event that Buyer’s Lender requires tax impounds, tax collector will not furnish a copy of said bill to Lender. TAX BILLS ISSUED AFTER CLOSE OF ESCROW SHALL BE HANDLED DIRECTLY BETWEEN BUYER AND SELLER OUTSIDE OF ESCROW.

All parties acknowledge that they are aware of the following: (i) Escrow Holder will, at Close of Escrow, prorate real property taxes based upon the latest available tax figures as furnished by the Title Company; (ii) the tax collector may issue supplemental tax bills for more than the amount so used for proration purposes, or in the event there has been an overpayment that the overpayment amount will not be refunded but will instead be held for the subsequent credit against the payment of future taxes on the Property.

In addition to acknowledging their awareness of the foregoing, all parties hereby agree that, any instruction in this Escrow to the contrary notwithstanding, any overpayment or any underpayment of taxes accruing because of the amount used by Escrow Holder for proration purposed at Close of Escrow shall be adjusted by and between the parties outside of Escrow. Escrow Holder is hereby released from and shall have no concern with, nor responsibility or liability of any kind or nature for or in connection with, any such overpayment or underpayment.

The parties hereto acknowledge that the Property may be presently assessed with other property and that the real property taxes, special taxes and assessments may not be segregated by the time this Escrow closes. If the real property taxes, special taxes and assessments are segregated and a tax bill is issued for the Property prior to the Close of Escrow, then Escrow Holder shall prorate the above-mentioned taxes based on the most-recent tax bill for the Property. If no segregated tax bill is issued for the Property prior to the Close of Escrow, then Escrow Holder shall prorate the same based upon Seller’s determination of the amount of real property taxes, special taxes and assessments applicable to the Property for the then-current fiscal year, which Seller shall submit to Escrow Holder in writing prior to the Close of Escrow. Seller’s determination will be made by dividing the total taxes, special taxes and assessments shown on the most-recent available tax bills for all tax assessor parcels comprising the Project by the total number of Residential Units in the Project. All prorations and adjustments are to be made on the basis of a thirty (30) day month.

F. HOMEOWNERS ASSOCIATION ASSESSMENTS: The initial monthly assessments will be $81 and shall be prorated as of Close of Escrow unless assessments commence at a later date pursuant of the provisions of the Declaration of Covenants, Conditions and Restrictions. In addition, Buyer

shall be charged with the assessment for the full month following the Close of Escrow, which shall be disbursed along with the prorated amount to Homeowners Association upon the Close of Escrow. The budget is based upon the Seller’s best estimates and may be revised, as circumstances require.

Pursuant to DRE Regulation 2792.9(a)(2), Seller has posted an assessment bond to guarantee its obligations to pay homeowners dues. The bond will remain on deposit with Escrow Holder until 80% of the units have been conveyed or leased and the Association has given written assurance to the Escrow Holder that Seller is current in its assessment payments for the unsold units.

G. INSURANCE PREMIUM PRORATION: Escrow Holder is hereby authorized and instructed to prorate any fire insurance premium for common areas or association property from the close of escrow to the date of expiration of the policy based upon an amount of 1/26th of the actual annual premium for this Unit. It is understood that Seller has prepaid fire insurance premiums covering this and or other property in the name of the Association for one year in advance. The fire insurance premium paid as part of the Association dues is being collected for the next year’s premium on the policy. It is further understood by Buyer that such policy does not cover the contents of the individual Units.

In the event Buyer desires personal property, contents (fire or liability), etc., Buyer shall be responsible to obtain same outside of escrow.

Buyer is aware that the Declaration requires that the Board of Directors maintain liability insurance in a minimum amount and if they fail to do so, owners may be individually liable for the entire amount of a judgment rendered against the association.

7. REMOVAL OF CONTINGENCIES.

Explanation of this section: Discusses various contingencies related to yourpurchase of this propery. Your purchase of this property is not contingenton your sale of other property.

Any removal or waiver of contingencies, or cancellation under this Section shall be in writing. The contingencies specified in this section must be removed within seventeen (17) days after the later to occur of (1) acceptance of this Agreement, or (2) after delivery of the Final Subdivision Public Report to Buyer (hereinafter "the Contingency Removal Period"). The Contingency Removal Period may only be extended, altered, modified or changed by mutual written agreement.

A. LOAN CONTINGENCY REMOVAL: Within the Contingency Removal Period, Buyer shall give Seller written notice of Buyer's election to remove or waive the loan contingency or cancel this Agreement. Should Buyer cancel under this paragraph, Seller shall return all of Buyer's funds deposited with Seller to Buyer.

D. INSPECTION CONTINGENCY REMOVAL: Within the Contingency Removal Period, Buyer shall complete all inspections, investigations, and review of reports and other applicable information, including those concerning the registered sex offender data base (see the Section entitled "DATA BASE NOTICE AND DISCLAIMER"), for which Buyer is responsible or that Buyer receives from Seller and, in writing, shall remove the applicable contingency or cancel this Agreement. t

If, within the Contingency Removal Period, Buyer does not give Seller written notice of the contingency removals, Seller may cancel this Agreement in writing provided Buyer has first been given notice to perform. The notice to perform shall be in writing and signed by Seller, and shall give Buyer at least twenty-four (24) hours, or until the previous agreed upon time limit, whichever occurs last, to perform. If Seller cancels under this Section, Seller shall return all of Buyer's funds deposited with Seller to Buyer. Notwithstanding the expiration of the time specified, Buyer retains the right to give Seller written notice removing the contingency or canceling the Agreement at any time prior to receiving Seller's written cancellation. Once Seller receives Buyer's written removal of all contingencies, Seller may not cancel this Agreement pursuant to this Section.

For any particular contingency or cancellation right that Buyer removes, with respect to that contingency or cancellation right, Buyer shall conclusively be deemed to have: (i) completed all inspections, investigations, and review of reports and other applicable information and disclosures; (ii) assumed all liability, responsibility and expense for repairs or corrections, or for inability to obtain financing if the contingency pertains to financing, unless Seller has agreed in writing to unconditionally take the action requested by Buyer; and (iii) elected to proceed with the transaction.

8. PROVIDING A STABILIZED COMMUNITY.

Explanation of this section: In order to provide a stable community, the Seller wants to discourage speculation and absentee ownership. You therefore agree not to tansfer your right to purchase before escrow closes.

A. ASSIGNMENT AND NON-SPECULATION: In order to induce Seller to agree to sell the Property to Buyer, Buyer represents and agrees not to transfer the Property prior to the close of escrow ("the Restricted Period"). The provisions of this section and the accuracy of the above representations and warranties constitute a covenant of Buyer and a condition precedent to Seller’s performance under the Agreement.

As used in this section, the term "Transfer" includes any assignment, conveyance, sale or other transfer of title of any kind by Buyer during the Restricted Period but does not include a change of title resulting from (a) death of Buyer; (b) transfer to Buyer and Buyer’s spouse, (c) a decree of dissolution of marriage or legal separation or a property settlement agreement incident to such decree; (d) transfer into a revocable inter vivos trust of which Buyer is a beneficiary; or (e) transfer, conveyance, pledge, assignment or hypothecation to secure the performance of an obligation, where the encumbrance will be released or reconveyed upon the completion of such performance.

Buyer hereby agrees that, prior to any Transfer or attempted Transfer during the Restricted Period; Buyer shall first submit written notice to Seller of Buyer’s intent.

Upon proof satisfactory to Seller, Seller may elect to waive its rights under this section to accommodate hardship, such as a mandatory job transfer unless Buyer is self-employed; medical or financial emergency; or any other situation which, in the reasonable judgment of Seller, constitutes a "hardship" situation consistent with the intentions of this section.

Title shall be deeded only to Buyer. Prior to the Close of Escrow, Buyer shall not sell, assign, transfer, convey, lease, encumber nor record this Purchase Agreement, or any notice, assignment or memorandum thereof, or advertise or agree to do any of the foregoing, or show the Property to prospective purchasers. Buyer’s breach of this section shall be a material default hereunder and shall be grounds for Seller to terminate the Agreement pursuant to the section of this Agreement entitled "TERMINATION BY SELLER."

Notwithstanding the above, Buyer hereby instructs Escrow Holder to furnish to Seller any and all Escrow instructions and/or other documents and information disclosed to Escrow Holder r

regarding the transfer and/or sale of Buyer’s prospective interest in the Unit, which is the subject of this Escrow.

B. NUISANCES: Buyer shall not permit or cause anything to be done or kept upon the Property which may materially increase the rate of insurance on the Property or any other condominium Units in the development, or result in the cancellation of such insurance. Buyer shall comply with all laws, ordinances, statutes, rules or regulations of any City, County, state or federal body with jurisdiction over the development. Buyer shall comply with all of the requirements of the local or state health authorities and with all other governmental authorities with respect to the occupancy and use of the Property. Buyer shall be accountable to the Association and other condominium Unit owners for the conduct and behavior of children and other family members or persons residing in or visiting the Property. Any damage to the Common Area, personal property of the Association, or property of another owner, caused by such children or other family members shall be repaired at the sole expense of Buyer where such children or other family members or persons are residing or visiting.

9. FINANCING.

Explanation of this section: Unless you are paying all cash, you must do all of the following: (a) within 5 days, apply fo a loan and provide a copy of your application to the Seller including allowing the Seller to obtain yourcredit repor (b) within 7 days, provide the Seller with a loan approval, showing that you are acceptable to your lender as a borrower; (c) within 3 days, provide proof that you have available the funds you intend to use forhe cash portion of your payment If par of your financing is with a purchase money second deed of tust its tems are set forh in this section. You guarantee the accuracy of your statements and promise to update infomation if it changes. You also promise that your appraiser is independent of you. Any inaccuracy of information or lack of independence of your appraiser could be deemed a material defaultand cause he Selleroterminate your purchase.

A. LOAN APPLICATION: If a portion of Purchase Price will be paid with financing proceeds, Buyer shall do all of the following:

i. Submit to an institutional Lender or Lenders (as applicable, "Lender") no later than five (5) calendar days after execution of this Agreement by Buyer, all information necessary for approval of credit ("Credit Application") by Lender and provide Seller concurrently with such submittal, a copy of the Credit Application within such five (5) day period;

ii. Within two (2) days after request by Seller, submit all documentation necessary to "pre-qualify" with any "Pre-qualifying Lender" specified above, to enable Seller to determine if Buyer is financially capable of purchasing the Property (although such pre-qualification shall not constitute financing or loan approval by the Pre-qualifying Lender, nor shall Buyer be obligated to use the Pre-qualifying Lender to obtain financing in connection with the purchase of the Property), and

iii. Obtain and submit all documents and forms necessary to consummate the sale of the Property in accordance with the terms hereof, including, but not limited to, credit reports, appraisals, statements of identity, loan applications, employment verifications, notes, trust deeds, and loan Escrow instructions.

Buyer authorizes Seller to obtain a credit report on Buyer. Buyer acknowledges and agrees that Buyer will be obligated to advance and pay all costs charged by Lender to obtain loan approval and funding of the loan. Buyer is solely responsible for obtaining the financing necessary to purchase the Property, and no guarantee has been given by Seller or Lender, their agents, or sales representatives that Buyer will either qualify for financing offered by Lender or secure any other loan or financing. Seller has r , t; t . t r , r t r t t

made no representation that the interest rate prevailing at the Close of Escrow will be the rate quoted by Lender to Buyer at the time of loan approval.

All financing and the terms and conditions thereof, including, without limitation, impound payments and interest rate, are a matter of concern solely between Buyer and Lender and shall not in any way affect the rights or obligations of Seller or Buyer hereunder. The sale and purchase of the Property is not contingent upon Buyer’s ability to retain the interest rate quoted at the time of loan approval and Buyer will be required to pay the interest rate charged by Lender at the Close of Escrow.

B. LOAN APPROVAL: Within seven (7) business days after the Date of this Agreement, Buyer shall deposit, or cause to be deposited, with the Escrow Holder a written statement from Lender ("Peliminary Lender Approval") stating that Buyer is an acceptable borrower of the Loan Amount pursuant to Lender’s normal lending policies and ratios, based only upon (i) Buyer’s completed credit report, and (ii) as of the date of the Preliminary Lender Approval, Lender’s verification of Buyer’s income and of the existence on deposit and ready availability to Buyer of the amount of cash needed prior to Close of Escrow, less the Loan Amount.

Failure of Buyer to use their best efforts to qualify for and obtain such financing, or to otherwise comply with any of the requirements of this Agreement strictly within the time frames set forth herein, shall constitute a default under this Agreement, which default shall entitle Seller to cancel Escrow, terminate this Agreement and proceed in accordance with the section entitled "TERMINATION BY SELLER."

If, through no fault or default of Buyer, (i) Buyer (after processing for loan approval in good faith) is unable to obtain a loan commitment within the time provided above, or (ii) such loan commitment does not comply with the requirements set forth above, or (iii) such loan commitment expires or is withdrawn, canceled or invalidated for reasons beyond the control of Buyer, Seller may terminate this Agreement, cancel Escrow, and refund Buyer’s Deposit, and return all documents deposited by Buyer to Buyer, whereupon all rights and obligations of the parties shall be terminated. Termination of this Agreement shall not terminate Buyer’s indemnity of Seller as provided herein.

Once Buyer has deposited into Escrow the loan commitment described above, Buyer shall not be entitled to apply for or obtain any modified, additional, or new loan commitment from any Lender or other source ("New Loan") if the application of funding of the New Loan would, in Seller’s sole judgment, delay the Close of Escrow. Buyer’s application for or obtaining any unauthorized New Loan shall not extend the Closing Date, shall be deemed a default by Buyer hereunder, and shall entitle Seller to terminate this Agreement, cancel Escrow, and proceed in accordance with the section entitled "TERMINATION BY SELLER."

If Buyer is authorized in writing by Seller to apply for and obtain a New Loan and if Buyer fails to qualify for such New Loan, the Close of Escrow shall not be delayed and Buyer shall be obligated to purchase the Property and close Escrow using the original loan commitment obtained.

C. VERIFICATION OF FUNDS: Within three (3) days of execution of this Agreement by Seller, Buyer shall supply Seller with all information requested by Seller to verify the availability to Buyer of the cash funds necessary to complete purchase of the Property and close Escrow. If Buyer fails to timely supply Seller with any requested information, Seller may terminate this Agreement and cancel Escrow as set forth in the section entitled "TERMINATION BY SELLER."

D. LOAN LOCKS AND COMMITMENTS: Should Buyer decide to lock in an interest rate, Seller makes no guarantees that Buyer’s home will be complete in time to meet the terms of Buyer’s commitment. Nor, will Seller be responsible for any fees charged to Buyer for any extensions required by Lender in order to maintain an interest rate or other term of the loan lock. Seller will make every effort to complete Buyer’s home in a timely manner but makes no representations or guarantees as to a particular date Buyer’s home will be completed. r

Should Buyer decide to enter into an agreement with a lender regarding the locking of Buyer’s loan or for any other type of loan commitment that has a termination date, Buyer does so at Buyer’s own discretion and at Buyer’s own cost and at Buyer’s own risk. Seller and Seller’s agents assume NO liability in meeting any deadlines for the completion of Buyer’s home and shall not be responsible for any costs that Buyer may incur in attempting to meet the terms of Buyer’s agreement with Buyer’s Lender.

E. PURCHASE MONEY SECOND DEED OF TRUST: If the Buyer and Seller have elected to execute a Purchase Money Second Deed of Trust on the property, a New Purchase Money Second Deed of Trust, on Escrow Holder’s form, in favor of ___ given to secure a Note in the principal amount stated therein, bearing interest at the rate of ______ Percent Per Annum, due ___ (___) years from the close of escrow, with interest to accrue from the close of escrow, payable monthly, Interest Only, or more, payments commencing Thirty (30) Days after the close of escrow, and continuing on the same date of each calendar month thereafter until that date which is ___ (___) years from the date of the close of escrow, at which date the entire sum of principal and interest then owing shall be due and payable, at a place to be designated by the beneficiary. A Late Charge shall be made on each installment in default for ___ (___) Days or more in an amount equal to ___ (___) Percent of the delinquent payment.’

F. ACCURACY OF INFORMATION: Buyer hereby represents and warrants to Seller that all information given to Seller, Escrow Holder, Pre-qualifying Lender, and Lender by Buyer, whether orally or in writing, shall be completely accurate, true, and correct when given and at all later dates. Should any information given to Seller, Escrow Holder, Pre-qualifying Lender, or Lender by Buyer prove to be inaccurate in any material respect, such inaccuracy shall be a material default under this Agreement, and Seller, at its option, shall be entitled to terminate this Agreement, cancel Escrow, and proceed in accordance with the section entitled "TERMINATION BY SELLER".

Buyer and Seller agree that both Lender and the appraiser conducting the appraisal of the Property shall be independent of and unrelated to Buyer and shall not be affiliated with Buyer in any respect. If Lender and/or the appraiser are not independent of, unrelated to and unaffiliated with Buyer, then (i) Buyer’s failure to obtain Lender Approval by the Loan Approval Date, (ii) Buyer’s failure to procure an appraisal of the Property equal to or exceeding Purchase Price, or (iii) the revocation of Lender Approval by Lender, then Buyer shall be in default hereunder.

10. GOVERNMENT ASSISTED FINANCING.

Explanation of this section: If par of your fnancing is a Vetean’s Administration or Federal Housing Authority loan, the loan amounts facilitated by those agencies are limited by the appraised value or reasonable value of the property, and you are notobligated to purchase if the purchase price is greater than the governments appraised value. With a VA or FHA loan, the Seller pays certain fees.

A. VETERANS ADMINISTRATION ("VA") LOAN: Notwithstanding any other provisions of this Agreement, Buyer shall not incur any penalty by forfeiture of deposit or otherwise or be obligated to complete the purchase of the property described herein, if the contract purchase price or cost exceeds the reasonable value of the property established by the VA. Buyer shall, however, have the privilege and option of proceeding with the consummation of this contract without regard to the amount of the reasonable value established by the VA. Seller shall pay any fees that Buyer is not allowed to pay under VA Regulations.

B. FEDERAL HOUSING AUTHORITY ("FHA") LOAN: In the event that Buyer is purchasing the Subject Property with financing as approved by the FHA, Buyer shall not be obligated to complete the purchase of the property described herein or to incur any penalty by forfeiture of deposits or otherwise unless the Seller has delivered to Buyer a written statement issued by the FHA setting forth the appraised value of the property (excluding closing costs) of not less than the Purchase Price, which t i r ’

statement Seller shall deliver to Buyer promptly after such appraised value statement is made available to Seller.

Buyer shall, however, have the privilege and option of proceeding with the consummation of this contract without regard to the amount of the appraised valuation made by the Federal Housing Commissioner. The appraised valuation is arrived at to determine the maximum mortgage the Department of Housing and Urban Development will insure. HUD does not warrant the value or the condition of the property. The purchaser should satisfy himself/herself that the price and condition of the property is acceptable.

Seller shall pay any fees which buyer is not allowed to pay under FHA Regulations. In the event that Buyer elects to obtain a New First Trust Deed Loan from a Third Party Lender, Buyer acknowledges that Seller will not be responsible for any of the following ‘Non-Allowable’ FHA charges, including but not limited to: Lender Fees, Title Insurance Fees, Recording Fees and/or Escrow Fees. In the event that Buyer obtains the new FHA First Trust Deed Loan from a Third Party Lender, Buyer agrees that the Total Purchase Price will be increased in an amount equal to the ‘Non-Allowable’ FHA charges as previously set forth in this paragraph.

11. FINAL FUNDS.

Explanation of this section: The escrow company needs to receive the balance of your down payment and other charges at least 5 business days (excluding weekends and holidays) before escrow closes if by cashier’s check drawn on a California, but only 2 business days if by wire transfer; any other form of funds must clear before they can be considered deposited. The funds are payable to the escrow company.

Escrow Holder will require deposit of Buyer’s final funds 120 hours (at least five [5] business days) prior to Close of Escrow, if the funds are deposited in the form of a cashier’s check or will require deposit of final funds 48 hours (at least two [2] business days) prior to the Close of Escrow, if the funds are deposited by wire transfer. The final funds should be obtained from Buyer’s bank or savings and loan in the following manner: cashier’s check issued in the State of California by a bank located in the State of California, made payable to Escrow Holder in the amount requested by Escrow. Parties herein acknowledge that the following types of checks are not considered good funds and will be subject to check clearance (approximately 3 to 7 business days): out of state cashier’s checks, drafts, credit union checks, stock brokerage checks.

12. CONDITIONS TO CLOSE OF ESCROW.

Explanation of this section: Escrow cannot close until certain conditions have been met. They are that (a) the home and all common areas must be completed or their completion is secured by a bond, and (b) the Seller has provided you with a title insurance policy showing that the propery is fee and clear of encumbrances resulting from loans to the Seller, such as constuction loans.

This Escrow shall not close, funds shall not be released from Escrow, and title shall not be conveyed to Buyer UNTIL ALL OF THE FOLLOWING CONDITIONS HAVE BEEN MET:

A. All common facilities and improvements for the Project have been completed and a Notice of Completion as defined in California Civil Code Section 3093 has been recorded or the Seller has submitted a bond or other security acceptable to the Department of Real Estate under the provisions of Section 11018.5(a)(2) of the Business and Professions Code to assure lien free completion of all Common Area amenities and facilities and residential structures in this Project, and until either (i) the statutory period for recordation of all mechanics lien claims has expired, after the recordation of a valid Notice of Completion as defined in Section 3093 of the California Civil Code; or (ii) Seller has provided the t r r

Homeowners Association with a policy of title insurance with provisions guaranteeing against such lien claims.

B. Seller has complied with the purchase money requirements of Business and Professions Code Sections 11013, 11013.1, 11013.2 or 11013.4 as applicable, and Buyer will be provided a policy of title insurance showing that the Property is free and clear of any blanket encumbrances as defined in Section 11013. For purposes of compliance with Section 11013.2(a), a release from a blanket encumbrance resulting from a deed of trust or mortgage shall require both of the following:

i. Escrow holder has received written notice from the title insurance company that each and every money encumbrance, including without limitation any mortgage or deed of trust filed for record prior to the time of recording of the Declaration of Restrictions, has been either expressly reconveyed or subordinated to the Declaration; and

ii. Either:

a. An instrument has been duly recorded unconditionally reconveying and releasing the property being sold or leased from the lien or charge of such deed of trust; or

b. Buyer is notified that an agreement or demand constituting a release agreement as defined in Regulation 2791.1(b)(2)(A) has been duly deposited with Escrow Holder and is available to Buyer on request for each such deed of trust, and Buyer will be provided a policy of title insurance insuring Buyer against loss by reason of each such deed of trust.

13. TITLE.

Explanation of this section: The section covers he issues of"title", which is the total of what you will own. Title insurance is a form of insurance intended to protect you from claims by others that, if they are successful, would cause you to own less than you purported to acquire by the tems ofthe deed. The title company is in the business of researching a particularpropery toidentiyall easements, liens and other claims, which could affectyour title. The documents delivered to you at close of escrow describe the extent of your title.

The Property shall be conveyed subject to the usual Title Company printed exceptions, real property taxes and assessments, the installment or installments of which are not due or delinquent, special district levies, matters affecting title suffered or created by or with the written consent of Buyer, covenants, conditions, restrictions, reservations, easements, district levies, rights-of-way, reservation of mineral rights, and all matters which are otherwise of record or apparent, as of the Close of Escrow, including, without limitation, any exceptions shown on the preliminary title report. The Grant Deed conveying title to Buyer shall be deposited by Seller in Escrow.

At Close of Escrow, the Title Company shall furnish Buyer, at Seller’s expense, a standard CLTA owner’s policy insuring title vested in Buyer subject to the above listed exceptions. Buyer may request an ALTA owner’s policy; provided, however, that Buyer shall pay for the additional cost of such policy, to the extent it exceeds the cost of the standard CLTA policy to be provided by Seller. If requested by Buyer or required by Lender, Buyer shall be responsible for the cost of any Lender’s endorsement and/or policy of title insurance. Seller may, without notice and in its sole discretion, change the type of policy being provided.

BUYER ACKNOWLEDGES HAVING RECEIVED EACH OF THE FOLLOWING:

A. California Department of Real Estate Final Subdivision Public Report; t r t f

B. A copy of the Tract Map;

C. A copy of the Condominium Plan;

D. A copy of the Declaration of Restrictions, and any amendments thereto;

E. A copy of the Bylaws of Homeowners Association;

F. A copy of the filed Articles of Incorporation of the Homeowner’s Association;

G. A copy of Homeowners Association’s budget;

H. A copy of the Preliminary Title Report;

I. A statement concerning any delinquent assessments and related charges and, if available, current financial and related statements;

J. Notice of Builder’s Election of Alternative Pre-litigation Procedures for Construction Claims Pursuant to California Civil Code Section 895 et Seq.

K. A copy or summary of any notice previously sent to the Seller that sets forth any alleged violation of the Governing Documents that remains unresolved.

L. A copy of any preliminary list of any construction defects and a statement that a final determination of the defects has yet to occur, including whether the list of defects is accurate and complete.

M. A disclosure of any settlement agreement or other instrument between the association and the developer regarding construction defects, and the following information in connection therewith:

i. A general description of the defects that the association reasonably believes will be corrected or replaced, as of the date of the disclosure.

ii. A good faith estimate of when the association believes that the defects identified in (1) will be corrected or replaced, as of the date of the disclosure. The association may state that the estimate may be modified.

iii. The status of the claims for defects in the design or construction of the common interest development that were not identified in paragraph (1) whether expressed in a preliminary list of defects sent to each member of the association or otherwise claimed and disclosed to the members of the association.

N. Information regarding any approved change in the assessments or fees that are not yet due and payable as of the disclosure date.

Prior to Close of Escrow, if no other Escrows have closed in the Project, Seller (with the approval of the Department of Real Estate, if required) in its sole and absolute discretion, may make any material changes in (i) the legal management documents described immediately above, (ii) the overall development of the Project.

14. CLOSE OF ESCROW.

Explanation of this section: "Close of escrow" means the exchange of all funds and documents necessary for you to acquire title to your property. The exchange has been scheduled fo a specific date but can be delayed fo

r r Seller's Initials: ____________ Buyer's initials: _______\_______

various reasons, including the default of either you in failing to obtain yourloan or of the Seller to complete the improvements. Escrow cannot close until the California Deparment of Real Estae has issued its Final Subdivision Public Repor This section provides remedies if either pary is esponsible for delaying the close of escrow.

Escrow is scheduled to close on the later of (i) the Scheduled Closing Date or (ii) twenty one (21) days after the Property is completed and ready for occupancy and after approval of the appropriate governmental authority permitting occupancy, or (iii) twenty one (21) days after approval of the VA, FHA, FNMA, as applicable, or (iv) date of satisfaction of any presale requirement of Lender.

If the improvements are presently uncompleted, Seller shall use reasonable efforts to complete the improvements on the Property on or before the Scheduled Closing Date; provided, however, that in the event Seller is delayed in completing such improvements, the Close of Escrow shall be extended until ten (10) days after Seller notifies Escrow Holder and Buyer that the home is completed and ready for occupancy.

If Escrow does not close within one (1) year of the original "Closing Date", through no fault of Buyer, then within 15 days after the one (1) year of the Closing Date, Seller shall order all money paid by Buyer remitted to Buyer, without any deduction or charges. Seller shall pay all title and Escrow charges.

The actual Close of Escrow could substantially differ from the Scheduled Closing Date. Whether or not Buyer elects to cancel this agreement, Buyer hereby accepts the uncertainty of the date Escrow may close, and waives and releases any and all claims for damages, costs or other detriment to buyer, including, but not limited to, taxes, storage charges, rent payments, moving costs, interest rate changes, or any other damages against Seller, its agents, employees and independent contractors arising as a result of the inability of Seller to complete the improvements and close the Escrow within one (1) year, or any later date for closing mutually agreed to in writing by Buyer and Seller.

In the event that Close of Escrow is delayed as a result of the default of Buyer, the Closing Date of Escrow may be extended by a mutual written agreement between Buyer and Seller upon the following condition: Buyer shall deposit with Escrow Holder, upon demand, the entire balance of cash funds needed to be provided by Buyer to close Escrow.

Seller shall provide written notification instructions to Escrow Holder to extend the Closing Date and request payment of the above-referenced funds.

If Buyer has signed this Agreement under the authority of a "Conditional Subdivision Public Report," Escrow Holder shall be instructed that:

A. The sale of the real property shall not be consummated, nor shall any funds be released from escrow until such time as a current Final Subdivision Public Report has been delivered to Buyer:

B. If, for any reason, Seller has failed to deliver to Buyer a Final Subdivision Public Report within six (6) months from the date of issuance of the Conditional Subdivision Public Report, or if Buyer is dissatisfied with the Final Subdivision Public Report so delivered because of a change therein which is of a type which would require issuance of an amendment to a previously issued Conditional Subdivision Public Report pursuant to Section 11012 of the California Business and Professions Code, then Buyer may terminate this Agreement and receive the return of all funds deposited in escrow.

C. Written notice of such termination and the grounds therefore shall be delivered to Seller and to Escrow Holder in the manner provided in the Escrow Instructions. t t t. t r

Notwithstanding the foregoing, Buyer hereby acknowledges the possibility that Seller’s existing institutional holder of the existing Blanket Monetary Encumbrance, if any, may require the concurrent closing of two or more escrows for the sale of the Units in this Project, as a condition to releasing the encumbrance. Seller may instruct Escrow Holder that no escrow may close within the Project, which may include this transaction, until that number of Units being sold by Seller is equal to the percentile that the Lender can close simultaneously. Seller’s unilateral instruction shall automatically extend the close of escrow on all escrows until the minimum closing requirements are met.

15. ENVIRONMENTAL DISCLOSURES.

Explanation of this section: You acknowledge that there is no guarantee ofany of the following: the view you have fom your home remaining as it is at the time of your purchase; the availability or quality of nearby schools; uue uses in the project or nearby properies; the likely esale value ofyourhome. Your home may be located in a neighborhood that has conditions or impacts difeent fom those fo typical residential developments. Mold and mildew may occur The Seller must update its disclosures if conditions change but need not disclose mattes that your own inspector has discovered.

A. NO REPRESENTATIONS REGARDING RESALE, VIEWS, TRAFFIC, SCHOOLS OR FUTURE DEVELOPMENT: Seller has not made any oral or written statement, representation or warranty that there is any "view" from the property or that any existing "view" will not be obstructed in the future. Buyer, by accepting title acknowledges that: (a) there are no protected views, and no Unit is assured of the existence or unobstructed continuation of any particular view, (b) any view from the Unit is not intended as part of the value of the Unit and is not guaranteed; and (c) any future development, construction, landscaping, growth of trees, or other installation or improvements by Seller or other owners may impair the view from any home. No salesperson, employee, or agent has the authority to make any representations that contradict the foregoing statements.

Properties located in the vicinity of the development may be developed or readapted in the future. Such development will likely involve the construction of new buildings of sufficient size and height that views from the development will likely be impacted. Buyer recognizes the potential impacts of such development on the community and the development (e.g., additional traffic, parking impacts, noise impacts, market impacts, view impacts, etc.) and acknowledges that he or she is purchasing the Property with the full understanding of such potential impacts.

Buyer acknowledges that he or she has not relied on any representations made to the contrary by any sales representative or employee of Seller in the purchase of the home. Further, Seller has not made any oral or written statement, representation or warranty as to (i) any potential appreciation in or resale value of the home, or (ii) the availability or quality of any school or school facilities near the Project, or (iii) any future use of the Project or adjacent properties, or (iv) the existence of any "view" from the Property or that any existing "view" will not be obstructed in the future. Should Buyer desire any further information regarding the use or development of adjacent properties, Seller urges Buyer to contact the planning department of the city where the Project is located. Buyer shall make their own independent investigation as Buyer deems necessary regarding schools.

B. URBAN IMPACTS: The Property may be located in an urban area that generates unique conditions and impacts not typically associated with residential projects. Such impacts and conditions may include, without limitation, commercial, industrial and other business activity, traffic, homelessness, litter, graffiti, illegal dumping, filming activity and crime. Many of the foregoing impacts occur at all times of the day and night. Buyer recognizes that the foregoing "urban" impacts are a major element of the unique characteristics and eclectic mixture of uses that attracted Buyer to the Project and recognizes that Seller has no obligation to take any action to reduce or eliminate the foregoing impacts. Buyer is encouraged to become involved in the community (e.g., through "neighborhood watch" programs, neighborhood councils and the like) to help improve the Project and the community. r f t r t r f r r r . r

C. MOLD AND MILDEW. Homes cannot be constructed to repel microscopic mold spores. If the conditions permit, mold can grow anywhere, including in Buyer’s dwelling. Mold is fundamental to the natural decomposition of organic material and is ubiquitous in the environment. Mold fungi can grow on many items found in a home, such as wood, drywall, insulation, carpets, fabric, and wallpaper. A moist climate between 40 degrees and 100 degrees Fahrenheit are ideal for the rapid growth of mold. Elimination of moisture in the home is an owner’s most effective tool for eliminating mold growth. Moisture in a home can be caused by leaks, spills, overflows, condensation, and high humidity. Proper home maintenance practices are crucial to the prompt elimination mold.

Not all molds are harmful, although certain strains have resulted in adverse health effects in susceptible persons. The most common effects are allergic reactions, including skin irritations, watery eyes, runny nose, coughing, sneezing, congestion, sore throat and headache. Individuals with suppressed immune systems may be at particular risk of mold-related illnesses.

While some experts contend that mold causes serious symptoms and diseases which may be life threatening, the Center for Disease Control states that a causal link between the presence of toxic mold and serious adverse health conditions has not been proven. There is no medical consensus regarding the exact nature and extent of health problems mold may cause, and no agreement on the level of mold exposure required before related health problems can occur.

The Seller’s responsibility as a builder must be limited to things the builder can control. The existence of mold growth in a home depends primarily on how the owner maintains the home over the course of time. Buyer will need to take actions after the close of Escrow to prevent conditions that cause the growth of mold or mildew. This is part of the responsibility of ownership. Buyer agrees to assume responsibility for following the recommendations in the Mold Information Sheet. Buyer further acknowledges that if there is any water damage or water intrusion to Buyer’s residence, Buyer will take immediate action to prevent conditions which cause mold or mildew to develop.

Buyer acknowledges and agrees that Seller will not be liable for any actual, special, incidental, or consequential damages based on any legal theory whatsoever, including, but not limited to, strict liability, breach of express or implied warranty, negligence or any other legal theory with respect to the presence and/or existence of molds, mildew and/or any microscopic spores unless caused solely or partly by the negligence or willful misconduct of Seller.

Buyer, on behalf of itself and its family members, tenants, invitees and licensees, hereby releases Seller and Seller’s officers, directors, partners, members successors and assigns from and against any and all claims, actions, damages, causes of actions, liabilities and expenses (including without limitation, attorneys fees and costs including enforcing this indemnity) for property damage, injury or death resulting from the exposure to microscopic spores, mold and/or mildew and from any loss of resale value due to the presence and/or existence of mold, mildew and/or microscopic spores, provided, however, that in no event is Buyer releasing Seller as a result of the presence and/or existence of mold, mildew and/or microscopic spores if caused solely or partly by the negligence or willful misconduct of Seller.

Addendum B to this Agreement is a Mold Information Sheet published by the California Department of Health Services. Buyer has reviewed and fully understands the information and provisions set forth herein and in Addendum B concerning mold and mildew.

_____________________ Buyer's Initials

D DISCLOSURE OF CHANGED CONDITIONS: In the event Seller, prior to Close of Escrow, becomes aware of adverse conditions materially affecting the Property, or any material inaccuracy in disclosures, information or representations previously provided to Buyer of which Buyer is

otherwise unaware, Seller shall promptly provide a subsequent or amended disclosure or notice, in writing, covering those items. However, a subsequent or amended disclosure shall not be required for conditions and material inaccuracies disclosed in reports ordered and paid for by Buyer.

E SMOKE DETECTOR STATEMENT OF COMPLIANCE: California Building Code requires that all new dwelling Units contain smoke detectors in all sleeping rooms and at a point centrally located in the corridor or area providing access to the sleeping rooms. Further, the Code requires that these smoke detectors be hard-wired into the building's primary source of power and must have a battery backup. Smoke detectors will be appropriately installed in the home in accordance with all applicable code provisions. Please be aware that it is Buyer's obligation to maintain such smoke detectors in lawful working condition in the future and with respect to any future sale or conveyance of the Residence to any third party.

F WATER HEATER STRAPPING: Seller has complied with Health and Safety Code Section 19211 which requires that all water heaters shall be braced, anchored or strapped to resist falling or horizontal displacement due to earthquake motion in accordance with any applicable local code requirements.

G ADDITIONAL DISCLOSURES: The residences are constructed on post-tensioned concrete slabs, as to which the following disclosures are made:

Buyer acknowledges that the concrete slab for each residence in the Project was reinforced with a grid of steel cable that was installed in the concrete slab and then tightened to create extremely high tension. This type of slab is commonly known as a "Post Tension Slab." Buyer further acknowledges that cutting into a Post Tension slab for any reason (e.g. to install a floor safe, to remodel plumbing, etc.) is very hazardous and may result in serious damage to the residence and/or personal injury. As a material part of the consideration for the sale of residence by Seller to Buyer, Buyer covenants and agrees that: (1) Buyer shall not cut into or otherwise tamper with the Post Tension Slab; (2) Buyer shall not knowingly permit or allow any other person to cut into or tamper with the Post Tension Slab so long as Buyer owns any interest in the residence; (3) Buyer shall disclose the existence of the Post Tension slab to any person who rents, leases, or purchases the residence from Buyer; and (4) Buyer shall indemnify and hold Seller, and its officers, employees, contractors and agents, free and harmless from and against any and all claims, damages, losses or other liability (including attorneys' fees) arising from any breach of this covenant by Buyer. This covenant shall survive the close of escrow for the purchase of the residence by Buyer and delivery of the grant deed.

Buyer has read and understands the foregoing Disclosure. Buyer acknowledges that Buyer's decision to purchase a residence in the Project is not based on any representation (other than as described in this Disclosure) regarding the matters described herein, and Buyer has considered the possible effect of such matters in Buyer's decision to purchase a residence in the Project.

______________

Buyer’s Initials

16. DATA BASE NOTICE AND DISCLAIMER.

Explanation of this section: The seller is giving you notice thatthe California Department of Justice maintains a public database of persons required to egister as sex offenders. You are representing that you are not required to

r Seller's Initials: ____________ Buyer's initials: _______\_______

register, and that if this status changes, seller will have the right to rescind (cancel) the sale if escrow has not closed, or to repurchase your home fom you at fair market value if escrow has closed.

A. NOTICE: The following information is provided as required by Section 2079.10a of the California Civil Code:

"Pursuant to Section 290.46 of the Penal Code, information about specified registered sex offenders is made available to the public via an Internet Web site maintained by the Department of Justice at www.meganslaw.ca.gov. Depending on an offender's criminal history, this information will include either the address at which the offender resides or the community of residence and ZIP Code in which he or she resides."

B. SELLER DISCLAIMER: Seller makes no representations, warranties, or guarantees regarding the presence or absence of registered sex offenders within the Project or in the surrounding area. Seller has no obligation or duty to investigate existing residents or buyers to determine whether they are sex offenders. Buyer is solely responsible for making his or her own investigation.

C. BUYER REPRESENTATION, ACKNOWLEDGMENT AND OPTION TO REPURCHASE: Buyer represents that he or she is not required to register under Section 290.4 of the Penal Code. If before the close of escrow Buyer is required to register under Section 290.4, such requirement shall be grounds for rescission of this agreement by Seller. If after the close of escrow Buyer is required to register under Section 290.4, such requirement shall entitle Seller to repurchase the home from Buyer at fair market value prevailing at the time such requirement takes effect.

___________________ Buyer’s Initials

17. CONSTRUCTION DISCLOSURES.

Explanation of this section: If you selected your Unit on the basis ofa model or brochure, this section describes various ways in which the Unit delivered o you may diffe from what you saw.

It is understood that Buyer is purchasing a completed residence on the Property, and that Seller is not acting as a contractor for Buyer in the construction of the Residence. Although the completed residence may contain custom quality features, elements, amenities, and designs, there may exist similarities in floor plans and specifications in another residence in the Project or vicinity. Seller is constructing the residence to Seller’s own standards and specifications, including those relating to fit, finish, and quality, which may vary from the model, the approved plans and specifications, brochures, feature lists, renderings or other similar documents. Any material changes shall be agreed upon in writing between Buyer and Seller, except that material changes may be made without Buyer's consent if required by local officials.

There may be variances in the construction from residence to residence, and from the plans and specifications. Seller reserves the right to make any changes or substitutions Seller deems necessary or desirable, which shall be of equal or greater value and shall meet with the approval of the appropriate city or county department, and the Lender in the construction, materials, and fixtures contained in the finished Property. Any model home, rendering, or brochure shown to Buyer is displayed only for illustration and shall not be deemed an agreement by Seller to deliver the Residence in exact accordance therewith.

None of the appurtenances, fixtures, appliances, and furnishings shown in any model is included in this Agreement, unless Seller agrees in writing to deliver the same as part of the Purchase Price or as optional items. Seller reserves the right, at Seller’s discretion, to substitute the type and location of materials, appliances, and other items in the Residence and on the Property of substantially equal quality r t r

and utility meeting the approval of Lender in order to complete the Residence. The foregoing substitutions may include, without limitation, kitchen appliances, household fixtures, electrical outlets, and switches, hardware, wall surfaces, painting, and other similar items.

The useable or buildable area, location, and configuration of the Property and all improvements located thereon may fluctuate from that shown or displayed to Buyer in any drawings, plans, topographic maps, or models based upon Seller’s placement of final improvements, including, without limitation, fencing and slopes which shall be placed and constructed in Seller’s sole and absolute discretion. Square footages are approximate.

The Purchase Price is not based on square footage. Actual and useable footages may be different from the footages set forth on the plans and specifications. There are differences in the methods of measurement. Actual field construction may vary.

The location, size, height, and composition of all walls, fences, and other improvements to be constructed on the Property or adjacent thereto shall be determined by Seller in its sole and absolute discretion and despite models, drawings, or topographic maps displayed to Buyer, Seller has provided no representations, warranties, or assurances to Buyer as to the size, height, location, or composition of any wall, fence, or other improvement to be constructed on or adjacent to the Property. Seller shall have the right to make the substitutions described below without adjustment to the Purchase Price. The consultation by Seller or Seller’s agents with Buyer shall not be deemed a waiver of Seller’s rights to make any changes contemplated or provided herein.

If Seller is unable to complete or install on the Property any optional item, decorator item, fixture, furnishing, or other improvement to be constructed on the Property, which failure is caused by circumstances beyond the reasonable control of Seller, the Close of escrow hereunder shall not be delayed so long as occupancy of the Residence is approved by the applicable governmental authority. Seller shall complete the incomplete items as soon as reasonably possible after the Close of Escrow. Buyer shall have deemed to accept the Property delivered to Buyer if Buyer does not note such changes and specifically disapproved at the time of the "walk-through". Seller shall not be required to correct or modify any changes disapproved by Buyer.

No warranties, expressed or implied, are or will be given by Seller or any representative of Seller with respect to the type, nature or size of any future construction, development or house plans or future phases, or as to Buyer incentives, auctions, price changes, appreciation, terms, or value, or relating to any structure, or landscaping, or construction that may hereafter be placed upon any parcel of real property that could affect the view from or the value of the Property, all such rights being specifically reserved. If any future phases are built, they could affect your enjoyment of your property, either positively or negatively.

18. CHANGES IN PRICE, PRODUCT, DEVELOPMENT PLAN AND MARKETING METHODS.

Explanation of this section: You acknowledge that the seller has he ighto change prices and plans for other homes in the project, even if these changes may affect the value of the home you are buying.

Buyer acknowledges that Seller may, in its sole discretion, change its pricing, product, development plan and marketing methods for other Units in the Project including, without limitation, the following: Seller may elect to sell other Units in the Project, under terms and conditions which are more favorable than those offered to Buyer; and/or Seller may elect to sell Units of the same type as the Residential Unit, but to reduce the sales price for such Units, or to improve such Units with more or less expensive features and amenities. Buyer acknowledges that any of the foregoing events may adversely affect the value of the home. Seller may substitute, eliminate or modify the type and location of materials, appliances, and fixtures in the Property with those of substantially equal quality and utility to complete the refurbishment of the Property. There shall be no modification of the Purchase Price due to any of these changes. t r t

19. NEW HOME UNIVERSAL DESIGN CHECKLIST, OPTIONS AND UPGRADES.

Explanation of this section: California law requires developers of new housing toinfombuyers regarding a list of design features specifed by law. The developer is not required to provide these features, but is required to inform the buyer whether each such feature is standard, limited, optional or not available and, as to features that are optional, to specify the point in constucton at which the buyer must request installation of the feature and the estimated additional cost, if any.

You and the Seller may have agreed in writing upon certain other options orupgrades, but otherwise, and other than standard floor coverings, the Selleris not providing options. Seller is not your contactor, but is merely providing you with a completed dwelling.

A. NEW HOME UNIVERSAL DESIGN CHECKLIST: Buyer and Seller have discussed and have both signed the New Home Universal Design Checklist ("Design Checklist"), including any further attachments specifying additional details, components or features upon which Buyer and Seller have agreed, which is attached to this agreement as Addendum E. The Design Checklist identifies universal accessibility features and identifies them as standard, limited, optional or not available, and further identifies the point in the construction process before which the feature must be requested and paid for. Seller and buyer may agree in writing upon different standards if they are clearly disclosed. Unless agreed upon between Buyer and Seller, Seller is not required to provide any feature stated in the Design Checklist.

B. ADDITIONAL CUSTOM FEATURES, OPTIONS AND UPGRADES: The Property does not include any furnishings, draperies, decorator items, upgrades or landscaping except as specifically described in this Agreement, or in a separate option/upgrade agreement executed by Seller and Buyer. Standard floor coverings are included in the Total Purchase Price. However, the cost of options or upgrades selected after execution of this Agreement by Buyer, if any, are not included, unless specifically covered in this Agreement.

It is understood and agreed that Seller is not updating the Home to the precise specifications or designs of any model home, plan or brochure, or to the specifications of any Buyer. Any model home is displayed for illustrative purposes only and such display shall not constitute an agreement or commitment on the part of Seller to deliver the Home herein purchased in exact accordance with any such model home. Buyer is purchasing a completed dwelling Unit and Seller is not acting as Buyer’s general contractor. Consultation with Buyer with respect to the specifications of the Residential Unit shall not, in any case, be deemed a waiver of Seller’s rights to make any such changes or substitutions, as Seller in its sole discretion deems necessary. None of the items or furnishings, built-ins, landscaping or upgrades shown in any model home is included in this Agreement unless Seller concurrently herewith or hereafter specifically agrees in writing by a separate written instrument to deliver same as part of the Purchase Price. Any changes requested by Buyer will not be made unless Seller agrees in writing.

Additional options or upgrades, if any, may be selected by Buyer and agreed to in writing by Seller at a later date, with those costs added to the Total Purchase Price. Buyer must select such options/upgrades prior to the date determined by Seller. In the event that Seller accepts Buyer’s offer to purchase options or upgrades, Escrow Holder will be given additional Escrow instructions regarding payment of such options or upgrades or installation of non-standard color tile and/or carpet prior to the Close of Escrow.

All upgrades, purchase options, and changes are to be paid in full by Buyer to Seller in advance outside of Escrow (if Seller has posted Security as required by the Department of Real Estate) at the time such items are agreed upon. Seller will incur costs and expenses, and commit itself contractually for such items. The providing or installation of such items shall not delay Close of Escrow. r i r i r

For those options included in the Total Purchase Price and any subsequently purchased options and upgrades, Buyer agrees to make color and optional item selections from the choices provided by Seller. In lieu of certain selections, Buyer, with the consent of Seller in its sole discretion, may elect to receive a credit (in an amount reasonably established by Seller) to be credited at Close of Escrow against Purchase Price. If Buyer elects to take such a credit and installs such item(s) himself, which is subject to the consent of Seller, Seller shall not have any liability or obligation for such installation, nor shall Seller’s Limited Warranty cover such installation. Buyer’s selection(s) shall be final. If Buyer fails to make such selection(s) within the specified time, such failure shall be deemed a material breach of this Agreement and Seller may thereupon make the selection for Buyer, and Seller shall have no liability or additional obligations to Buyer therefor.

20. INSPECTIONS AND WALKTHROUGHS.

Explanation of this section: Befoe opening this escrow, you have read the Public Report issued fo the propery and have physically inspected the propery, and you are relying on your own inspection. Within 7 days ofopening escrow, you and the seller will walk through your new home together to make a mutually agreed list of any corrective work that needs to be done, and there will be a final joint walkthrough at least 3 days before escrow closes. If you and the seller cannot agree on corections to be made, you must both sign escrow cancellation instuctions and your entedeposit will be refunded, less reasonable escrow cancellation fees charged by the escrow company. Your approval of the fnal walkthrough is not a condition to closing escrow. r r t t r r ir i

A. BUYER'S INSPECTION: Buyer represents that, prior to the execution of this Joint Purchase Agreement and Escrow Instructions, he or she has read the Public Report, if any, filed with the DRE by Seller. Buyer further represents that he or she has conducted his or her own physical inspection of the subject property and is relying only upon that physical inspection.

___________________ Buyer’s Initials

B. PRELIMINARY WALKTHROUGH: Within SEVEN (7) days after opening escrow, Buyer and Seller shall conduct a preliminary walkthrough of the Subject Property. Buyer shall provide Seller with a written list of Buyer's requested repairs to be completed prior to close of escrow. Seller shall approve or disapprove such list in writing within SEVEN (7) days of receipt of same. Should Buyer and Seller be unable to come to mutual agreement on said repair list, both parties shall execute escrow cancellation instructions, Buyer shall be released from the obligation to purchase Subject Property, Buyer's full deposit shall be released to Buyer, and Seller shall be released from the obligation to sell Subject Property to Buyer.

C. FINAL WALKTHROUGH: Not less than THREE (3) days before the close of escrow, Buyer shall have a final walkthrough, which shall NOT BE A CONTINGENCY TO THE CLOSING OF THIS ESCROW, but only to verify that all items approved by Seller on Buyer's initial walkthrough have been completed.

21. LIMITED WARRANTIES FOR NEW CONSTRUCTION.

Explanation of this section: There is a limited one-year warranty for certain ypes of defects, but you must notify the seller of any warranty problems andallow the seller to fix them. The law requires the seller to inform you ohe insulation properties of the insulating mateals used in your home. There is no guarantee or waranty fo soundproofing.

t f t ri r r Seller's Initials: ____________ Buyer's initials: _______\_______

A. LIMITED ONE-YEAR WARRANTY FOR FIT AND FINISH ITEMS: As required by Civil Code Section 900, Seller provides a limited warranty of the fit and finish of the following building components: cabinets, mirrors, flooring, interior and exterior walls, countertops, paint finishes, and trim. This warranty does not apply to damage to those components caused by defects in other components of the construction. The terms of the warranty are set forth in Addendum D.

B. NOTICE AND OPPORTUNITY TO CURE: During the period that the Warranty is in effect, if Buyer has any claim covered by the Warranty, Buyer shall follow Seller’s procedures relating to the Warranty, as may be provided to Buyer. During the term of the Warranty, any conflict between the provisions of this section and the Warranty shall be resolved in favor of the Warranty. Seller shall not be liable for any general, special or consequential damage, cost, diminution in value or other loss which Buyer may suffer as a result of any Defect in the Property, which reasonably might have been avoided had Buyer given to Seller notice and opportunity to cure the defect. Except as otherwise provided in the Warranty, the provisions of this Section do not establish any contractual duty or obligation on the part of Seller to repair, replace or cure any defect in the Property. Buyer’s covenants under this Section shall survive the Close of Escrow.

C. INSULATION: As part of the Agreement between Buyer and Seller with which Escrow Holder is not to be concerned, insulation will be installed in the Property as follows (the higher the R-value, the greater the insulating power):

i. Exterior walls will be insulated with unfaced fiberglass batts to a thickness of _____", which, according to the manufacturer, yields an R-value of _______.

ii. Interior walls will be insulated with unfaced fiberglass batts to a thickness of _____", which, according to the manufacturer, yields an R-value of _______.

iii. Ceilings at roof exposed to living areas will be insulated with unfaced fiberglass batts to a thickness of ____", which, according to the manufacturer, yields an R-value of _______.

D. SOUND TRANSMISSION: Seller does not in any manner guarantee or warrant that the home will be soundproof or insulated to any particular degree from noise, sound or music, emanating from within or without the Property, including, without limit, sound emanating from homes, heating, ventilation, air conditioning systems, plumbing, stereo systems, Common Area(s), and Garages.

22. ENTRY UPON PROPERTY; BUYER IMPROVEMENTS.

Explanation of this section: Unless you are already leasing the home you are buying, you have no right to enter it until the close of escrow, and any such entry would be a default under this agreement unless you are leasing he home fom the seller and have the sellers express permission to make changes or improvements to the home. You do not have the rights to communicate directly with the Seller’s construction workers, to enter the construction site unless accompanied by the Seller’s authorized epresentative, or to supply your own mateals or workers. If you ente the propery, Seller is not liable fo any injury you may sustain.

Unless Buyer is currently leasing the Unit, Buyer shall not be permitted to enter, occupy, inspect or take possession or make any alterations of, or additions to, any interior or exterior improvements thereon until after the Close of Escrow without the prior written approval of the Seller. Unless Buyer is currently renting the home from Seller, Buyer’s entry onto the Property prior to the Close of Escrow to perform or complete any work on or to the Property without Seller’s express prior written consent shall constitute a default under this Agreement.

Buyer shall not communicate directly with or otherwise give directions to Seller’s superintendents, subcontractors and/or laborers at the Unit or the Project regarding any matter, including, without t r ’ r ri r t r

limitation, requests for changes, material selections, or schedule and/or cost issues. Buyer shall direct all such communications or correspondence in writing to Seller.

Buyer recognizes that the Project is an on-going construction site and that dangerous conditions may exist on the property. Buyer agrees not to enter the property unless accompanied by an authorized representative of Seller. If Buyer enters the development prior to the Close of Escrow, Buyer assumes all risk, liability and obligation for any injuries or damages to Buyer and to any guests, licensees or invitees of Buyer, and Buyer does hereby agree to defend, indemnify and hold Seller, its sales personnel and all officers, agents, servants, and employees of Seller, harmless from and against any claims, losses, fees, liabilities, and expenses, including, without limitation, attorneys’ fees and costs arising from or related to such entry.

Buyer acknowledges and agrees that, prior to the Close of Escrow, Buyer shall not be allowed to supply any materials, subcontractors or labor of any kind for the Unit or the Project. All work or improvements to the Unit, including, without limitation, any interior or exterior modifications, painting, wallpapering, fixturization, lighting, placement of curtains and/or specialty equipment may not be performed by Buyer until after the Close of Escrow.

If Seller incurs any costs or expenses as a result of Buyer’s breach of the provisions of this Paragraph, such costs and expenses shall be chargeable to Buyer and payable to Seller through Escrow. Buyer agrees to execute instructions to the Escrow Holder acknowledging such additional costs to be paid to Seller through Escrow and to deposit in Escrow such additional funds as shall be required therefor. If Buyer fails to execute such Escrow instruction when requested, this Escrow shall not be affected and the Close of Escrow shall occur notwithstanding Buyer’s failure; provided, however, in such event Buyer shall remain obligated to Seller for such additional costs, such additional costs shall not be extinguished, and such obligation shall survive the Close of Escrow.

23. TERMINATION BY SELLER.

Explanation of this section: If you fail to abide by the tems of this agreement, including time limits, the Seller will have the right to terminate he agreement by sending a temination notice to both you and the escrow company. In addition, the seller can either recover damages fom you in cour or retain liquidated damages, if you have signed the liquidated damages provision set foth below in the section entled "LIQUIDATED DAMAGES."

A. TERMINATION WITHOUT DEFAULT OF BUYER: If Seller elects to terminate this Agreement as the result of Seller's rights under another provision of this Agreement, or as a result of inability to close escrow because of substantial damage to or destruction of the Property, eminent domain, act of a governmental entity or act of God or any circumstance beyond Seller's control, due to no fault of Buyer, all of Buyer’s deposits, including funds from options and upgrades, shall be refunded to Buyer within fifteen (15) days of such notice without deduction and the parties shall have no further rights or obligations with respect to the Property under this Agreement. In the alternative, Buyer may establish that he or she is ready, willing and able to close escrow and may demand that Seller close escrow as scheduled.

B. UPON BUYER’S DEFAULT: Buyer's failure to perform within the time or in the manner required under any of the provisions of this Agreement shall constitute a default. In the event of any default by Buyer, Seller shall be entitled to, cumulatively or severally, terminate this Agreement without any liability or further obligations to Buyer, cancel the Escrow and pursue any available remedy at law or in equity against Buyer, or, if Seller and Buyer have initialed the liquidated damages section contained in this Agreement, Seller shall be entitled to retain such sum as liquidated damages for default.

C. SELLER’S TERMINATION NOTICE: If Buyer fails to complete the purchase of the Property by reason of any default of Buyer under this Agreement (including, without limitation, Buyer’s r t r r t r it

failure to use best efforts to obtain financing as required by this Agreement or if Seller, in its sole discretion, determines that Buyer will not be able to close escrow due to a failure of a condition to the close of escrow, Seller may terminate this Agreement and cancel the Escrow by giving written notice of such termination ("Termination Notice") to Escrow Holder and Buyer by registered or certified mail, return receipt requested or by personal service. The Termination Notice shall contain a statement that Seller has determined that Buyer is in default hereunder, that Seller is terminating this Agreement and canceling the Escrow, that Seller is electing to retain liquidated damages in accordance with the provisions of the section entitled "LIQUIDATED DAMAGES" below if applicable.

24. CANCELLATION OF SALE.

Explanation of this section: If either you or the seller cancel the escrow in he exercise of rghts that either one of you has under the agreement then both of you agree to sign mutual escrow cancellation instructions and torelease deposits to the party entitled to receive them. California law imposes a penalty of up to $1,000 for the wrongful failure to sign escrow cancellation instructions.

If Buyer or Seller gives written notice of cancellation pursuant to rights duly exercised under the terms of this Agreement, Buyer and Seller agree to sign mutual instructions to cancel the sale and Escrow and release deposits to the party entitled to the funds. A party may be subject to a civil penalty of up to $1,000 for refusal to sign such instructions, if no good faith dispute exists as to who is entitled to the deposited funds (California Civil Code section 1057.3).

Upon Escrow Holder’s receipt of these signed cancellation instructions Seller shall be completely released from their obligation to sell and Buyer shall be released from their obligation to buy. Within ten (10) days after such termination Buyer shall deliver to Seller all documents delivered by Seller to Buyer hereunder outside of escrow; Buyer shall have no further right or interest in the Property; and Buyer’s indemnity of Seller under the section entitled "ENTRY UPON PROPERTY; BUYER IMPROVEMENTS" shall survive the termination.

25. LIQUIDATED DAMAGES.

Explanation of this section: "Liquidated damages" means damages whose amount is agreed upon in advance because of the difficulty of proving an actual amount. California law allows a buyer and seller to agree on liquidated damages upon a buyer’s default but only if they agree in a signed writing. The liquidated damages amount is 3% of the purchase price unless he seller proves that a greater amount is reasonable. You are not required o agree to liquidated damages.

IF BUYER FAILS TO TIMELY COMPLETE THE PURCHASE OF THE PROPERTY BY REASON OF A DEFAULT OF BUYER, OR BUYER FAILS TO PERFORM OTHER OBLIGATIONS UNDER THIS PURCHASE AGREEMENT, SELLER SHALL BE RELEASED FROM ITS OBLIGATION TO SELL THE PROPERTY TO BUYER, AND SELLER MAY PURSUE ANY REMEDY IN LAW OR EQUITY THAT IT MAY HAVE AGAINST BUYER ON ACCOUNT OF THE DEFAULT; PROVIDED, HOWEVER, THAT BY PLACING THEIR INITIALS HERE:

____________ _____________ BUYER SELLER

BUYER AND SELLER AGREE THAT:

BUYER ACKNOWLEDGES AND AGREES THAT IN THE EVENT THAT BUYER DOES NOT TIMELY COMPLETE HIS/HER/THEIR PURCHASE OF THE PROPERTY AND THE HOME CONSTRUCTED THEREON BY SELLER, THE AMOUNT OF DAMAGES THAT SELLER MAY SUFFER AND FOR WHICH BUYER MAY BE LIABLE WOULD BE EXTREMELY DIFFICULT TO DETERMINE. SAID DAMAGES MAY INCLUDE BUT ARE NOT LIMITED TO: A CHANGE OR DIFFERENCE IN THE VALUE OF THE PROPERTY; SELLER BEING t i , , t t

UNABLE TO SELL THE PROPERTY AND HOME THEREON FOR THE PRICE CONTEMPLATED HEREUNDER, INCLUDING RECOUPMENT OF OPTIONS; THE TIME NECESSARY TO SELL THE HOME AND PROPERTY MAY BE EXTENDED; SUBSEQUENT CHANGES, MODIFICATIONS, AND ADDITIONS MAY BE REQUIRED FOR SELLER TO SELL THE HOUSE TO ANOTHER PARTY; ADDITIONAL CARRY COSTS AND INTEREST CHARGES MAY BE INCURRED; ADDITIONAL COMMISSIONS MAY HAVE TO BE PAID; AND SELLER MAY INCUR OTHER COSTS OR DAMAGES, INCLUDING LEGAL FEES, WHICH DAMAGES SELLER AND BUYER CANNOT FULLY ASCERTAIN OR ACCURATELY ESTIMATE AT THIS TIME.

THEREFORE, AFTER DUE NEGOTIATION, AND AFTER EACH PARTY HAS OBTAINED ADVICE OF INDEPENDENT LEGAL COUNSEL, SELLER AND BUYER AGREE THAT THREE PERCENT (3%) OF THE TOTAL PURCHASE PRICE FOR THE PROPERTY, INCLUDING THE COST OF OPTIONS, IS A REASONABLE ESTIMATE OF SAID DAMAGES UNDER SECTION 1671, ET SEQ., OF THE CALIFORNIA CIVIL CODE, AND MAY BE RETAINED BY SELLER AS LIQUIDATED DAMAGES, NOT AS A PENALTY, IN THE EVENT THAT BUYER DEFAULTS UNDER ITS OBLIGATIONS UNDER THIS PURCHASE AGREEMENT, OR FAILS TO TIMELY COMPLETE PURCHASE OF THE HOME AND PROPERTY.

HOWEVER, NOTWITHSTANDING THE FOREGOING, IF CONSTRUCTION HAS COMMENCED, SELLER MAY ELECT TO PROCEED IN ACCORDANCE WITH SECTION 1675 OF THE CALIFORNIA CIVIL CODE. IF SELLER PROVES TO THE ARBITRATOR, OR IN COURT IF THERE IS NO ARBITRATION, THAT AN AMOUNT OF LIQUIDATED DAMAGES GREATER THAN THREE PERCENT (3%) IS REASONABLE AS SET FORTH IN THAT STATUTE OR SUCCESSOR STATUTE, THEN SELLER SHALL BE ENTITLED TO RETAIN SAID GREATER AMOUNT.

LIQUIDATED DAMAGES SHALL BE REMITTED TO SELLER IN ACCORDANCE WITH THE FOLLOWING PROCEDURES: SELLER SHALL GIVE WRITTEN NOTICE TO ESCROW HOLDER AND TO BUYER, IN THE MANNER PRESCRIBED BY SECTION 116.340 OF THE CODE OF CIVIL PROCEDURE FOR SERVICE IN A SMALL CLAIMS ACTION, OF SELLER’S DETERMINATION THAT BUYER IS IN DEFAULT, AND DEMAND THAT ESCROW HOLDER DISBURSE THE LIQUIDATED DAMAGES DESCRIBED ABOVE TO SELLER ("SELLER’S DEMAND").

WITHIN TWENTY (20) DAYS OF BUYER’S RECEIPT OF SELLER’S DEMAND, BUYER SHALL DELIVER A WRITTEN NOTICE TO ESCROW HOLDER THAT BUYER OBJECTS EITHER TO SELLER’S TERMINATION OF THIS AGREEMENT AND BUYER INTENDS TO DILIGENTLY PURSUE PURCHASE OF THE PROPERTY, OR INSTRUCTING ESCROW HOLDER NOT TO DISBURSE SUCH LIQUIDATED DAMAGES TO SELLER ("BUYER’S OBJECTION").

IF BUYER FAILS TO DELIVER BUYER’S OBJECTION TO ESCROW HOLDER WITHIN THE TWENTY (20) DAY TIME PERIOD, TIME BEING OF THE ESSENCE, ESCROW HOLDER SHALL RELEASE TO SELLER SUCH LIQUIDATED DAMAGES, AND REMIT THE BALANCE OF THE FUNDS IN ESCROW, IF ANY, TO BUYER. UPON RECEIPT OF BUYER’S OBJECTION, ESCROW HOLDER SHALL IMMEDIATELY NOTIFY SELLER AND THE CONTROVERSY REGARDING THE DISPOSITION OF FUNDS DEPOSITED INTO ESCROW BY BUYER SHALL BE RESOLVED IN ACCORDANCE WITH THE ARBITRATION PROVISIONS OF THIS AGREEMENT, AS SET FORTH HEREIN ABOVE.

THE PAYMENT OF SUCH LIQUIDATED DAMAGES TO SELLER SHALL CONSTITUTE SELLER’S SOLE REMEDY ON ACCOUNT OF BUYER’S DEFAULT.

26. ARBITRATION OF DISPUTES.

Explanation of this section: If a dispute arises between you and the sellerbefoe escrow closes about whether either of you has the righttoterminate his agreement you can agree to resolve the dispute through binding arbitation, which is a relatively fast method of resolving disputes. Arbitation involves giving up your right to a tial, and arbitation is only valid if you make that agreement in writing by signing this provision. You are not required to agree to binding arbitration to resolve such disputes. If

r t , r r r r Seller's Initials: ____________ Buyer's initials: _______\_______

you agree to arbitration of disputes during escrow, this section establishes the procedures for such arbitration.

THIS AGREEMENT PROVIDES FOR ARBITRATION OF DISPUTES ARISING FROM THE TERMINATION OF THIS AGREEMENT BEFORE THE CLOSE OF ESCROW AND TRANSFER OF TITLE. NO OTHER ISSUE BETWEEN BUYER AND SELLER SHALL BE SUBJECT TO ARBITRATION, BUT RATHER SHALL BE RESOLVED BY JUDICIAL REFERENCE, PURSUANT TO THE SECTION OF THIS AGREEMENT ENTITLED "ALTERNATIVE DISPUTE RESOLUTION PROCEDURE."

IF THERE IS ANY DISPUTE OR CONTROVERSY ARISING OUT OF OR IN ANY WAY RESULTING FROM A PARTY’S ELECTION TO TERMINATE THIS AGREEMENT AS A RESULT OF AN ALLEGED DEFAULT BY THE OTHER PARTY, SUCH DEFAULT AND THE APPROPRIATE REMEDY THEREFOR SHALL BE RESOLVED AND DETERMINED BY ARBITRATION UNDER THE COMMERCIAL ARBITRATION RULES OF THE AMERICAN ARBITRATION ASSOCIATION ("AAA") OR THEIR EQUIVALENT (HEREINAFTER "ARBITRATION"), WITH VENUE BEING EXCLUSIVELY IN THE COUNTY IN WHICH THE PROJECT IS LOCATED.

IF THE DISPUTE IS REFERRED TO ARBITRATION, ANY FEE TO INITIATE ARBITRATION SHALL BE PAID BY SELLER, BUT THE COST OF ARBITRATION SHALL ULTIMATELY BE BORNE BY THE PARTY DETERMINED BY THE ARBITRATOR TO BE RESPONSIBLE. THE PREVAILING PARTY SHALL RECOVER REASONABLE ATTORNEY’S FEES, AS DETERMINED BY THE ARBITRATOR. THE ARBITRATOR SHALL HAVE THE POWER TO DECIDE ALL ISSUES OF FACT AND LAW, TO GRANT ALL APPROPRIATE REMEDIES, AND TO REPORT HIS OR HER DECISIONS ON SUCH ISSUES. ALL DECISIONS OF THE ARBITRATOR SHALL BE CONCLUSIVELY PRESUMED TO BE FINAL AND NOT SUBJECT TO APPEAL OR OTHER CONTEST. JUDGMENT UPON THE AWARD RENDERED BY THE ARBITRATOR MAY BE ENTERED IN ANY COURT HAVING JURISDICTION THEREOF. SELLER SHALL DELIVER A COPY OF THE ARBITRATOR’S DECISION TO ESCROW HOLDER. IF POSSIBLE, THE ARBITRATOR SHALL BE A RETIRED JUDGE.

NOTICE: BY INITIALLING IN THE SPACE BELOW YOU ARE AGREEING TO HAVE ANY DISPUTE ARISING OUT OF THE MATTERS INCLUDED IN THE "ARBITRATION OF DISPUTES" PROVISION DECIDED BY NEUTRAL ARBITRATION AS PROVIDED BY CALIFORNIA LAW AND YOU ARE GIVING UP ANY RIGHTS YOU MIGHT POSSESS TO HAVE THE DISPUTE LITIGATED IN A COURT OR JURY TRIAL. BY INITIALLING IN THE SPACE BELOW YOU ARE ALSO GIVING UP YOUR JUDICIAL RIGHTS TO DISCOVERY AND APPEAL, UNLESS THOSE RIGHTS ARE SPECIFICALLY INCLUDED IN THE "ARBITRATION OF DISPUTES" PROVISION. IF YOU REFUSE TO SUBMIT TO ARBITRATION AFTER AGREEING TO THIS PROVISION, YOU MAY BE COMPELLED TO ARBITRATE UNDER THE AUTHORITY OF THE CALIFORNIA CODE OF CIVIL PROCEDURE. YOUR AGREEMENT TO THIS ARBITRATION PROVISION IS VOLUNTARY.

WE HAVE READ AND UNDERSTAND THE FOREGOING AND AGREE TO SUBMIT DISPUTES ARISING OUT OF THE MATTERS INCLUDED IN THE "ARBITRATION OF DISPUTES" PROVISION TO NEUTRAL ARBITRATION.

Initials: ________/________ _______ BUYER SELLER

27. ALTERNATIVE DISPUTE RESOLUTION PROCEDURE.

Explanation of this section: This section applies to disputes arising afeescrow closes. Any dispute arising during escrow will be resolved by binding arbitration described in the immediately preceding section.

The tem "alternatve dispute resoluton" rees to out-ofcour methods ofesolving disputes between you and the seller This section establishes a series of steps to be taken to resolve such disputes: informally meeting and t r r i i f r - t r .

conferng; mediation, and judicial reeence (described below in paragraph D of this section). Altenative dispute resolution involves both parties giving up their right to a jury trial and will not apply unless you sign. You are not equired to give up your right to a jury trial.

The most common kind of dispute between a buyer and a seller involves claims of construction defects. Because you are purchasing a newly constucted home, California law provides cerain procedures fo pre-litigation notices and opportunities to resolve the dispute without going tocourt. By the close of escrow, you will receive a copy of a law sometimes called the California "Fix-It Law" or "SB 800," found in California Civil Code section 895 to 945.5. The law requires the buyer to give the builder the opporunity to fix the defect.

The dispute resolution procedures follow a three-step process: first an infomal meet-and-confer session to see if the dispute can be informally esolved. If not, then you or any other claimant must give a formal notice of the complaint to the other pary(ies). The second step is fomal mediation with the assistance of a neutral facilitator to see if the dispute can be resolved though mutual agreement. If mediation fails, the third step is judicial refeence, which is explained in this section.

A. SCOPE AND PURPOSE: The purpose of this Section is to provide expedited means of resolving any and all claims, disputes and disagreements which may arise between Buyer and Seller after the close of escrow. To the extent permitted by law, all such disputes shall be resolved under the "alternative dispute resolution" procedures provided by this section and by Article XV of the Declaration of Covenants, Conditions and Restrictions.

B. NO RIGHT TO TRIAL: Each of the Parties has waived or shall waive his/her/its right to trial by jury or by a judge sitting without a jury and shall resolve the dispute through the alternative dispute resolution procedures set forth in this section and by Article XV of the Declaration of Covenants, Conditions and Restrictions.

WE HAVE READ AND UNDERSTAND THE FOREGOING AND AGREE TO WAIVE OUR RIGHT TO A TRIAL AND TO SUBMIT TO JUDICIAL REFERENCE, PURSUANT TO SECTION 638 OF THE CALIFORNIA CODE OF CIVIL PROCEDURE OR SUCCESSOR STATUTE, ALL DISPUTES ARISING AFTER THE CLOSE OF ESCROW AND TRANSFER OF TITLE.

Initials: _______/________ _______

BUYER SELLER

C. MEDIATION - DISPUTES OTHER THAN CONSTRUCTION DEFECTS: Litigation arising out of this Agreement shall not be commenced until after the matter has been submitted to a nonaffiliated mediator, unless the dispute arises from a party’s attempt to terminate this agreement or is within the monetary jurisdiction of the small claims court. The mediator shall have sufficient availability such that the mediation occurs within fifteen (15) days after the request to mediate is received and occurs at a mutually convenient location within the county where the action is pending.

D. PROCEDURES FOR RESOLUTION OF ALL DISPUTES - JUDICIAL REFERENCE, JUDGMENT AND APPEAL:

i. Submission to Judicial Reference. If either Party commences a lawsuit for a dispute arising under this Agreement, all of the issues in such action, whether of fact or law, shall be submitted to general judicial reference pursuant to California Code of Civil Procedure sections 638(a), 639(a) and (d), and 641 through 645.1, or any successor statutes thereto. Any party to such lawsuit may commence a judicial reference pursuant to Code of Civil Procedure section 638. ri f r r r r t r t r r t r r r

Explanation of Judicial Refeence : Judicial reeence is established by statute in California and has been judicially approved in the context of ownerdeveloper disputes. When a lawsuit is filed, the case is assigned to a cour or a particular judge. In judicial refeence, the judge, with input fom the parties, then appoints a reeee (usually a reed judge) to handle all the fact-finding aspects of the case and report back to the judge when a decision has been made. At that point a judgment is entered and the decision can then be appealed like any other final court decision. The proceedings before the referee are like those of a tial by judge (not jury). In one respect, judicial reeence is more expensive than a tial, because the parties pay the referee’s fees. On the other hand, the referee usually has more time to devote to the case than judges with heavy caseloads often have, and there may be less uncerainty than ifthe dispute is decided by a jury. r

Judicial reeence has advantages over binding arbitation, which must comply with federal as well as state arbitration laws, is not appealable by a dissatsfied pary, and can lead to seemingly arbitrary results. Because judicial reference uses the same procedures as court trials, most lawyers are very familiar with those rules and may be better able to accomplish settlements or fairer trial results than in arbitation.

ii. Inclusion of Necessary Parties. The Parties shall cooperate in good faith to ensure that all necessary and appropriate parties are included in the judicial reference proceeding.

iii. Sharing of Costs and Fees. Seller shall advance the fees necessary to initiate the dispute resolution process. The Parties shall share equally in the fees and costs of the referee, unless the referee orders otherwise. The prevailing party shall recover his/her/its reasonable attorneys’ fees and costs.

iv. Authority and Qualifications of Referee. The general referee shall have the authority to try all issues, whether of fact or law, and to report a statement of decision to the court. The referee shall be the only trier of fact or law in the reference proceedings and shall have no authority to further refer any issues of fact or law to any other party, without the mutual consent of all parties to the judicial reference proceeding.

The referee must be a retired judge or a licensed attorney with substantial experience in relevant real estate matters. The referee shall not have any relationship to the parties or interest in the project. Any dispute regarding the selection of the referee shall be resolved by the entity providing the reference services, or, if no entity is involved, by the court with appropriate jurisdiction.

The referee shall apply the laws of the State of California, including the rules of evidence, unless expressly waived by all parties to the judicial reference proceeding. The referee shall have the power to grant all legal and equitable remedies and award compensatory damages in the judicial reference proceeding.

v. Timeliness of Reference Proceedings. The participants in the judicial reference shall meet to select the referee within ten (10) days after service of the initial complaint on all defendants named therein. The referee shall promptly commence the judicial reference proceeding at the earliest convenient date in light of all of the facts and circumstances and shall conduct the proceeding without undue delay.

vi. Reference Venue and Procedures. The proceedings shall be heard in the county in which the Property is located.

(a) The referee may require one or more prehearing conferences.

(b) The parties shall be entitled to discovery and to avail themselves of the subpoena power of the court ordering the reference, and the referee shall oversee discovery and may enforce all discovery orders and subpoenas in the same manner as any trial court judge. f r / t r r f r tir r f r r t f r r i t r

(c) A stenographic record of the hearing shall be made, provided that the record shall remain confidential except as may be necessary for posthearing motions and any appeals, and the Parties shall share equally in the cost of the record unless the Parties agree or the referee orders otherwise.

vii. Discovery. The parties to the judicial reference proceeding shall be entitled only to limited discovery, consisting of the exchange between such parties of only the following matters: (i) witness lists; (ii) expert witness designations; (iii) expert witness reports; (iv) exhibits; (v) reports of testing or inspections of the property subject to the dispute, including but not limited to, destructive or invasive testing; and (vi) trial briefs. Such parties shall also be entitled to conduct further tests and inspections as provided in subparagraph (b) above. Any other discovery provided for in the California Code of Civil Procedure shall be permitted by the referee upon a showing of good cause or based on the mutual agreement of the parties to the judicial reference proceeding. The referee shall oversee discovery and may enforce all discovery orders in the same manner as any trial court judge.

viii. Motions. The referee shall have the power to hear and dispose of motions, including motions relating to provisional remedies, demurrers, motions to dismiss, motions for judgment on the pleadings and summary adjudication motions, in the same manner as a trial court judge, except the referee shall also have the power to adjudicate summarily issues of fact or law including the availability of remedies, whether or not the issue adjudicated could dispose of an entire cause of action or defense. Notwithstanding the foregoing, if prior to the selection of the referee, as provided herein, any provisional remedies are sought by the parties to the dispute, such relief may be sought in the Superior Court of the County in which the Project is located. The referee shall have the authority to rule on all post-hearing motions in the same manner as a trial judge.

ix. Duty to Mitigate and to Maintain; Limitation on Remedies. Seller shall not be liable for any general, special or consequential damage, cost, diminution in value or other loss that Buyer may suffer as a result of any Claimed Defect in the Property, which reasonably might have been avoided had Buyer adhered to commonly accepted maintenance practices and maintenance recommendations by Seller or by the manufacturer of manufactured products and appliances, or had given Seller timely notice and opportunity to cure the Claimed Defect.

The measure of damages related in any way to alleged patent and/or latent construction defects and/or alleged failure to disclose claims shall not exceed the lesser of the actual costs of repair thereof or diminution in value. Declarant shall not be liable for punitive damages. The referee shall be entitled to determine whether such repair(s) or correction(s) have been satisfactorily performed.

x. Statement of Decision. The referee’s statement of decision shall contain findings of fact and conclusions of law to the extent required by law if the case were tried to a judge. The decision of the referee shall stand as the decision of the court, and upon filing of the statement of decision with the clerk of the court; judgment may be entered thereon in the same manner as if the dispute had been tried by the court.

xi. Judgment and Appeal. The statement of decision of the referee upon all of the issues considered by the referee is binding upon the Parties, and upon filing of the statement of decision with the clerk of the court, or with the judge where there is no clerk, judgment may be entered thereon. Upon entry of judgment, the decision of the referee shall be appealable as if rendered by the court.

E. ADDITIONAL PROCEDURES FOR RESOLUTION OF CONSTRUCTION DEFECT DISPUTES (SB-800):

The procedures set foth in this paragraph apply only to constuction defect disputes between Seller and Buyer

i. Contractual Pre-Litigation Procedures for Construction Defect Disputes. In the event of a dispute between Seller and Buyer arising from a claim of a structural defect in violation of Sections 895 through 897 of the California Civil Code, the disputants shall abide by the contractual pre-litigation procedures set forth below in lieu of the procedures set forth in California Civil Code Sections 910-938:

ii. Notification to Seller of Claim. If Buyer discovers a material, structural or other defect in the Property covered by California Civil Code Sections 895 through 897 ("Claimed Defect") that Buyer feels may be the responsibility of Seller or any director, officer, partner, member, employee or agent of Seller, or any contractor, subcontractor, design professional, engineer or supplier who provided labor, services or materials to the Project and who is bound or has agreed to be bound to the following dispute notification and resolution procedure (collectively "Seller Parties"), Buyer shall notify Seller, in writing, at Seller’s address for service of process registered with the California Secretary of State.

Such notice shall be deemed a notice of intention to commence a legal proceeding and shall include all of the following information: i) the claimant’s name, address and preferred method of contact; ii) that the claimant alleges a violation pursuant to SB-800 against Seller; and iii) a description of the claim in reasonable detail sufficient to determine the nature and location, to the extent known, of the claimed defect, including a citation to the specific subdivision and paragraph number of Civil Code Section 896 alleged to be violated, if any, together with any additional information required by Section 910(a) of the California Civil Code or its successor statutes.

Buyer’s/Association’s written notice to Seller is a condition precedent to Buyer’s/Association’s right to institute a legal proceeding, and Buyer/Association shall not pursue any other remedies available, at law or under this Agreement, until Seller has had the reasonable opportunity to inspect and cure the Claimed Defect.

iii. Seller’s Rights of Inspection. Upon receipt of a claim, Seller shall have the right to inspect the claimed defect, as provided by Section 916 of the California Civil Code or any successor statute. The Parties shall cooperate as necessary to provide entry at reasonable times and under reasonable conditions for the purpose of curing the defect.

iv. Offer to Repair. Upon inspection, Seller may offer to repair the defect, and Buyer may authorize the repair, as provided by Article XV in the Declaration.

v. Mediation. Seller’s offer to repair shall be accompanied by an offer to mediate the dispute if the Buyer so chooses. The mediation shall be conducted pursuant to the provisions of Section 919 of the California Civil Code or any successor statute.

vi. Judicial Reference. In the event the dispute is not resolved through informal means, mediation or repurchase, the parties shall submit the dispute to judicial reference as set forth above.

vii. Application of Award. The net proceeds of any judgment against, or settlement entered into with Seller, after payment of costs of litigation, including attorney’s fees, may be used only for the purposes of repairing, replacing, or mitigating the defects with respect to which the judgment was entered or the settlement made. r r .

NOTICE: BY INITIALING IN THE SPACE BELOW, YOU ARE GIVING UP YOUR RIGHT TO HAVE THE DISPUTE LITIGATED IN A TRIAL BEFORE A JURY OR JUDGE, AND YOU ARE ALSO GIVING UP YOUR RIGHTS TO DISCOVERY AND APPEAL EXCEPT AS PROVIDED IN THIS SECTION. YOU ARE AGREEING TO HAVE ANY DISPUTE, EXCEPT FOR LIQUIDATED DAMAGES CLAIMS AND CLAIMS ARISING BEFORE THE CLOSE OF ESCROW, OR MATTERS WITHIN THE MONETARY JURISDICTION OF THE SMALL CLAIMS COURT, DECIDED BY MEDIATION OR BY A NEUTRAL REFEREE APPOINTED BY THE COURT. YOUR AGREEMENT TO THIS ALTERNATIVE DISPUTE RESOLUTION PROCEDURE IS VOLUNTARY.

WE HAVE READ AND UNDERSTAND THE FOREGOING AND AGREE TO SUBMIT DISPUTES

ARISING OUT OF THE MATTERS INCLUDED IN THIS SECTION TO THE ALTERNATIVE DISPUTE RESOLUTION PROCEDURES DEFINED IN THIS SECTION.

Initials: __________/__________ __________ BUYER SELLER

28. GENERAL PROVISIONS.

Explanation of this section: This section includes miscellaneous provisions that apply to the entire purchase agreement.

A. MODIFICATION; WAIVER: This Agreement may not be changed, altered, or modified, except by writing signed by Buyer and authorized officer of Seller. The waiver by Seller of any term(s), condition(s), or provision(s) of this Agreement shall not be construed as a waiver of any other or subsequent term(s), condition(s) or provision(s) of this Agreement.

B. SEVERABILITY: If a