HomeMy WebLinkAboutR33-Economic Development Agency
ECONOMIC DEVELOPMENT AGENCY
OF THE CITY OF SAN BERNARDINO
FROM:
Maggie Pacheco
Interim Executive Director
SUBJECT: 2005 HOME Funds Loan and Grant
Agreement - AHEPA National Housing
Corporation and AHEP A Local
Arrowhead 302 Chapter for the
development of a 90 unit senior bousing
complex
DATE:
December 12,2005
_._____.d.___________________.._____.___._____________..__....._____________._..._______..______________..._______-------------------.-------------
Smopsis of Previous Commission/Council/Committee Action(s):
On November 8, 2005, Redevelopment Committee Members Estrada and Longville unanimously voted to recommend that
the Community Development Commission consider this action for approval.
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Recommended Motionls):
Open/Close Public Hearing
(Mavor and Common Councill
~1otion: That the Mayor and Common Council of the City of San Bernardino approve an Amendment to the 2005-2010
Five Year Consolidated Plan and the 2005-2006 Annual Action Plan authorizing $840,000 of HOME funds to
AHEPA National HouslOg Corporation and AHEPA Local Arrowhead 302 Chapter
ICommunitv Develooment Commission)
Resolution of the Community Development Commission of the City of San Bernardino approving and
authorizing the Interim Executive Director of the Redevelopment Agency of the City of San Bernardino
("Agency") to execute the 2005 HOME Funds Loan and Grant Agreement by and between the Agency and
.'''HEP A National Housing Corporation and AHEP A Local Arrowhead 302 Chapter
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Contact Person(s):
Maggie Pacheco
Phone:
(909) 663-1044
Project Area(s):
Inland Valley Development Area (lVDA)
Ward(s):
2"'
Supporting Data Attached:
o Staff Report 0 ResolutlOn(s) 0 Agreement(s)'Contract(s) 0 Map(s) 0 Letters
Budget Authonty:
ml () .
SIGNATURE: I I ~ ~ /
:laggie Pacheco. Interim Executive Director
$ 840,000
Source:
2001-2005 Federal HOME funds
FL'NDING REQUIREMENTS:
EDA Budget
,j:, /"", "'~ ,:', /~ ~
Barbara Lindseth, Admin. Services Director
Commission/Council ~otcs:
P IAgtndas'Comm De_ C'f"m"""n cex- ~l>j~ ,O~-I:- j'f "/HoP" Sen,or C,'mpk. SR do<-
CO~IMISSION MEETING AGENDA
'leeting Date: 12/19/2005
Agenda Item Number: R,4,!j
1;"/19/lJS
ECONOMIC DEVELOPMENT AGENCY
STAFF REPORT
2005 HOME FU;\'DS LOAN AND GRANT AGREEMENT - AHEPA NATIONAL HOUSING
CORPORATION AND AHEPA LOCAL ARROWHEAD 302 CHAPTER FOR THE
DEVELOPMENT OF A 90 UNIT SENIOR HOUSING COMPLEX
BACKGROUND/CURRENT ISSUE:
]n November 2004, AHEPA National Housing Corporation (AHEPA) was awarded a total of $13
million IIUD 202 Supporting Housing Program grant ("HUD GRANT") on behalf of their local
chapter AHEP A Arrowhead Chapter 302, for the construction and operation of a ninety (90) senior
housing unit ("Project") to be developed at 377 East Gilbert Street ("Site"). AHEP A is a non-profit
corporation founded in 1983 with a goal of improving the quality of life for the elderly and
handicapped and presently has 63 projects in 19 states totaling 3,456 apartment units, of which 47
projects, with a total of 2,632 units, are in operation throughout the east coast and mid west. The
remaining projects are at various stages of development.
In May 2004, AHEPA entered into an Agreement, "Granting Option to Purchase" with 377 Gilbert
LLC, the seller to purchase the Site for the sum of 5840,000. Per the Agreement's provisions, the Site
must be bought by January 7, 2006, or AHEPA could lose its exclusive right and option to purchase
said Property.
In order to assist AHEP A, Staff is proposing to increase the previously approved 5700,000 of Federal
HOME funds to 5840,000 in order to allow AHEPA to purchase the Site prior to January 7, 2006.
According to HUD regulations, the HUD GRANT will not be released until the Project's plans,
specifications and building permits are approved by the City. Given the tremendous volume of
development projects currently being processed by Development Services, it could take until spring of
2006 before plans and building permits are issued. Once this occurs, AHEP A will submit an entire
development package along with the approved plans and permits to HUD for approval, which is
estimated to occur sometime in late summer 2006.
Consequently, it is proposed to enter into a HOME Funds Loan and Grant Agreement in the amount of
5840,000 structured as follows:
Interim A\2encv Loan - The Agency Loan will be an interim loan to AHEPA in an amount not to
exceed $840,000 to be used for the acquisition of the Site. The loan will be evidenced by a Promissory
Note and a Deed of Trust will be recorded against the Site.
The Agency loan will have a term of one (I) year and there will be 110 interest on the loan if paid
\\Jthil1 the one-year period. AHEPA will repay the Agency loan in full with the BUD Grant.
A\2enev Grant - When the Agency Loan has been repaid, the Agency will grant to AHEPA HOME
funds for construction of off-site improvements and design up-grade amenities that are not covered by
the HUD Grant. AHEPA will be required to submit a detailed line item budget to the Agency for
approval and prior to disbursement of any HOME Grant funds not to exceed 5840,000.
1,";;':0' (""LIB Dc> C"""'";>Ion CDC ~OO_\ ,il_'.1 :.1':1 :\!feP:\ S\.-~Jf" C"nlrk. SR -1.-,
co"mSSIO:'i :\IEETII\'G AGENDA
:\leeting Dale: 12/19/2005
Agenda \tern Nnmber:
Economic Development Agency Staff Report
AHEP A - Senior Complex
Page 2
On May 16,2005, the Community Development Commission (CDC) appropriated $700,000 of federal
HOME funds to AHEP A for the construction of off-site improvements related to the Project based on
preliminary construction costs estimates. HllD does not allow in their HllD GRANT, monies to pay
for any off-site improvements or other amenities that are required by the City or Agency. The AHEP A
Project has received approval from the City's Development Environmental Review Committee
(DERC) and the Planning Commission approved their application on November 9, 2005.
The proposed Project is the construction of a three (3) story, 90-unit senior housing on approximately
2.48 acres of land located on the southeast comer of Gilbert Street and Parkside Drive. Each one-
bedroom living unit (89 units) will be approximately 540 square feet living area, with a full kitchen,
refrigerator, sink, and sufficient cabinet space but most importantly, will foster a true atmosphere of
independence in living. One unit of two (2) bedrooms will be reserved and occupied by the on-site
manager. All 89 units will be reserved for very low-income seniors (minimum age of 62) whose
monthly rental costs will not exceed 30% of the monthly household income. In exchange for the
Agency HOME Loan and Grant funds of 5840,000, AHEP A will be required to reserve the units for
very low and low- income seniors for a period of not less than 55 years pursuant to the terms and
conditions of a HOME Loan and Grant Agreement.
ENVIRON:\IENTAL IMPACT:
On November 9, 2005, the Planning Commission considered and approved AHEPA's Conditional Use
Permit (CUP) No. 05-27 and in conjunction with said CUP, made a finding that the Project is exempt
from the California Environmental Quality Act (CEQA), pursuant to Section 15332, infill
development, and no further environmental document is required pursuant to Section 15168 of the
CEQA guidelines and the Community Development Commission is relying on this determination and
the necessary Notices of Determination and Exemption will be filed with HUD and the County Clerk.
FISCAL Il\IPACT:
The 5840,000 will be funded with federal HOME funds, program years 2001-2004.
RECOl\lI\lENDA nON:
That the Mayor and Common Council adopt the Motion and Community Development Commission
adopt the attached R)SOlution. -
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l\Iaggie Pachc Q->.. Interim Executive Director
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)' A;;cndas CQmm Dc\ C"mm,ss'co (DC :t'0S C,'-I:.:" ."'tiEr>, S~nlcr C2rT,plc\ 5R J0:
COM:\IISS10i'i ;\IEETli'iG AGENDA
l\leeting Dale: 12/19/2005
Agenda Item Number:
RESOLUTION NO.
2
RESOLUTION OF THE COMMUNITY DEVELOPMEl"T COMMISSION
OF THE CITY OF SAN BERNARDINO APPROVING AND
AUTHORIZING THE INTERIM EXECUTIVE DIRECTOR OF THE
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
("AGENCY") TO EXECUTE THE 2005 HOME FUNDS LOAN AND
GRANT AGREEMENT BY AND BETWEEN THE AGENCY AND AHEPA
l"ATIONAL HOUSING CORPORATION AND AHEPA LOCAL
ARROWHEAD 302 CHAPTER
3
4
5
6
7
8
WHEREAS. the City of San Bernardino (the "City") is an entitlement jurisdiction an
9
receives annuallv certain federal funds under the HOME Investment Partnership Act (th
10
"HOME Program") from the United States Department of Housing and Urban Developmen
1]
("'HUD") in order to carry out eligible affordable housing activities within the City in accordanc
12
with the HOME Program Regulations set forth in Title 24 Code of Federal Regulations Part 92
13
et seq. (24 CFR Part 92); and
14
WHEREAS, the Mayor and Common Council have approved an Amendment to th
2005-2010 Five Year Consolidated Plan and the 2005-2006 Annual Action Plan authorizin
15 I
I 5840,000 of Federal HOME funds to AHEP A National Housing Corporation and AHEP A Loca
16
17
Arrowhead 302 Chapter: and
18
WHEREAS, the City has designated and authorized the Agency to administer an
]9
implement the HOME Program of the City; and
20
WHEREAS, HOME Program funds of the City may be used by the Agency for locall
2]
-
based nonprofit housing entities to carry out affordable housing activities in compliance with th
00
HOME Program Regulations, including without limitation "Senior Housing" developmen
23
projects as this term is defined at 24 CFR Part 92.2; and
24
WHEREAS, the Grantee is a National and locally certified and/or approved an
25
experienced nonprofit housing organization, and the Grantee has obtained approval from th
United States Department of Housing and Urban Development ("HUD") a Section 202 Grant i
-1- .
1':A~nda~'.R~50IU\l0l>1;R,,~olulions\2:005\OS.12-1' "HEPA Rt'lO_doc
the sum of Eleven Million One Hundred Ninety Nine Thousand Three Hundred Dollar
2 ($11,199,300) for the construction and operation of a ninety (90) unit senior housing facility (th
3 "Project") and a five (5) year rental subsidy of$I,884,000; and
4 \VHEREAS, the Agency deems that the activities to be undertaken by the Grantee herei
5 are consistent with and supportive of the HOME Program Regulations and that the financia
6 assistance of the Agency in the amount of $840,000 is necessary and appropriate to initiate th
7 I transitional housing activities of the Grantee as set forth herein; and
8 WHEREAS, the Agency deems it desirable to enter into this 2005 HOME Funds Lo
9 and Grant Agreement with the Grantee in order to provide HOME Program funds of the City fo
I
] 0 the acquisition and construction of a ninety (90) unit senior housing facility by the Grantee an
II for the provision of affordable rental housing to low-income seniors in accordance with th
]2 HOME Program guidelines; and
13 NOW, THEREFORE, THE COM},tUNITY DEVELOPMENT COMM1SSION OF THE
]4 CITY OF SA.l\! BER.J"lARDINO DOES HEREBY RESOLVE, DETERIvlINE AND ORDER, AS
15 FOLLOWS:
16
Section 1.
The Community Development Commission finds and determines that th
]7
development of the Project and acquisition of Property and construction of Project as describe
18
in the 2005 HOME Funds Loan and Grant Agreement is within the scope, terms and provision
of the Redevelopment Plan for the Project Area, is consistent with the Agency's Housin
Implementation Plan, City's Consolidated Plan and will help eliminate blighting conditions i
19
20
:1l
the Project Area by creating affordable rental housing opportunities for Seniors who meet th
income eligibility guidelines,
22
Section 2. The Community Development Commission authorizes the appropriatio
23
in the sum of $840,000 from the federal HOME Program, fiscal year 2001-2005 for AHEP
National Housing Corporation to carry out the Project and the Interim Executive Director, hislhe
2~
25
designee, are authorized to execute the 2005 HOME Funds Loan and Grant Agreement an
I P,c-\!!~nd~I\Rtlolu"ons\RtsoJuli""1\200"'\O"'-l2-1'l AHEPA R~'o,doc
.2-
execute any such other documents as may be necessary to implement the 2005 HOME Fund
2
Loan and Grant Agreement and to make any necessary non-substantive changes in the 2005
3
HOME Funds Loan and Grant Agreement as may be approved by Agency Counsel, provide
such changes do not increase the Agency's financial contribution of $840,000 to the Project.
4
5
Section 3.
On November 9, 2005, the Planning Commission considered an
6
approved AHEPA's Conditional Use Permit (CUP) No. 05-27 and in conjunction with said CUP
made a finding that the Project is exempt from the California Environmental Quality Ac
7
(CEQA), pursuant to Section 15332, in fill development, and no further environmental documen
8
is required pursuant to Section 15168 of the CEQA guidelines and the Community Deve10pmen
9
Commission is relying on this determination and the necessary Notices of Determination an
]0
Exemption will be filed with HUD and the County Clerk.
]1
Section 4.
The Resolution shall become effective immediately upon its adoption.
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,
RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION
OF THE CITY OF SAN BERNARDINO APPROVING AND
AUTHORIZING THE II\'TERIM EXECUTIVE DIRECTOR OF THE
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
("AGENCY") TO EXECUTE THE 2005 HOME FUNDS LOAN AND
GRANT AGREEMENT BY AND BETWEEN THE AGEl"CY AND AHEPA
NATIONAL HOUSING CORPORATION AND AHEPA LOCAL
ARROWHEAD 302 CHAPTER
3
4
5
6
I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the
7
Community Development Commission of the City of San Bernardino at a
8
meeting thereof, held on the _day of
, 2005, by the following vote to wit:
9
Commission Members:
Aves
Navs
Abstain
Absent
10
ESTR./I.DA
LONGVILLE
MCGINNIS
]1
12
!
I' IDERRY
J KELLEY
14 I
JOI-D\SON
15
MC CAMMACK
16
] 7
Secretary
18
19 The foregoing resolution is hereby approved this
day of
,2005.
20
21
Judith Valles, Chairperson
Community Development Commission
of the City of San Bernardino
"
~3 I
24 I
Approved as to form and Legal Content:
By A:Q~II(J&
25
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P: '""'ge"d~1\Re.olulion.\Re.olulion.\2005,05.] 2-19 ..\Ht:r..\ Re.o.do(
2005
HOME FUNDS LOAN AND GRANT AGREEMENT
By and Between
Redevelopment Agency of the City of San Bernardino
(Agency)
and
AHEP A National Housing Corporation
AHEP A Local Arrowhead 302 Chapter
(Developer)
90 Units Three (3) Story Elderly Housing
377 East Gilbert Street
(Inland Valley Development Agency Redevelopment Project Area)
2005
HOME FUNDS LOAN AND GRANT AGREEMENT
AHEPA NATIONAL HOUSING CORPORATION
AHEPA LOCAL ARROWHEAD 302 CHAPTER ELDERLY HOUSING
THIS 2005 HOME FUNDS LOAN AND GRANT AGREEMENT (this "Agreement") is
entered into on December 19, 2005, 2005, by and between REDEVELOPMENT AGENCY OF THE
CITY OF SAN BERNARDINO (the "Agency"), a public body, corporate and politic, and AHEPA
NATIONAL HOUSING CORPORATION-AHEPA LOCAL ARROWHEAD 302 CHAPTER, a
California nonprofit corporation (the "Developer").
The Agency and the Developer hereby covenant and agree as follows:
I. [~100] SUBJECT OF AGREEMENT
A. [S101] Recitals
This Agreement is made and entered into with the respect to the following facts:
1. The Developer desires to construct and operate a Senior Housing Complex
consisting of eighty-nine (89) one (I) bedroom affordable senior housing units and one (I) two (2)
bedroom manager's unit (hereafter the "Project"); and
2. The Project is entitled, "AHEPA LOCAL ARROWHEAD 302 CHAPTER
ELDERLY HOUSING" and is designated as Project No. I 43-EE056-W AH-NP/CA430-S041-001; and
3. The Project is proposed to be located on certain real property located within the
City of San Bernardino (the "City") and within the Inland Valley Development Agency
Redevelopment Project Area (the "Project Area") referred to herein as the "Site". The Site is depicted
on Exhibit '"A" and more particularly described on Exhibit "B," attached hereto and incorporated
herein by this reference; and
4. The Developer has obtained approval from the United States Department of
Housing and Urban Development ("HUD") for Section 202 Capital Advance Program Funding for the
Project in the amount of $11,199,300.00 and a five (5) year rental subsidy of $1,884,000; and the
Developer will enter into HOD Capital Advance Documents (as hereinafter defined) with HOD at the
time of the initial HOD closing; and
5. The Agency is desirous of aiding the Developer in the interim acquISItIon
ljnancing of the Site and in the construction of the Project by defraying a portion of certain on-site and
off-site construction costs of the Project; and
6. The Agency's participation in the Project is limited to the amounts to be set
forth in this Agreement; and
4849-60 18-7776.1 -1-
~Aiend.u,^genda ^IlKhmenliAgnnl~-"mend ~OO5'.o5.1:-19 AHEPA.Arro...hud 302 ChaplCT HOME Grillll Agreemenl dol:
7. The Developer is responsible for the construction of the said Project at its sole
expense, from the funding sources described above, and any other funding source available to it for
that purpose; and
8. The Agency has determined that the development of the Site pursuant to this
Agreement and the fulfillment generally of this Agreement are in the vital and best interest of the City
and the Agency.
B. [g102] The Site
The Site is located in the City of San Bernardino and the Inland Valley Development Agency
Redevelopment Project Area (the "Project Area") and is shown on the "Site Map" which is attached to
this Agreement as Exhibit "A" and incorporated herein by this reference. The Site is described in the
"Legal Description" which is attached hereto as Exhibit "B" and incorporated herein by this reference,
and is located at 377 East Gilbert Avenue in the City of San Bernardino, California.
C. [9103] Parties to this Agreement
1. [g104] The Agency
The Agency is a public body, corporate and politic, exercising governmental functions
and powers, and organized and existing under the Community Redevelopment Law of the State of
California.
The principal office of the Agency is located at 201 North "E" Street, Suite 301, San
Bernardino, California 92401.
The term "Agency" as used in this Agreement includes the Redevelopment Agency of
the City of San Bernardino and any assignee or successor to its rights, powers, and responsibilities.
2. [g 105] The Developer
The Developer is AHEP A National Housing Corporation - AHEP A Local Arrowhead
302 Chapter, Inc., a California nonprofit public benefit corporation (the "Developer"). The principal
office of the Developer is located at 1035 South Inland Center Drive, San Bernardino, California
92408.
The term "Developer" as used in this Agreement includes the Developer and any
assignee or successor to its rights, powers, and responsibilities.
3. [S I 06] Prohibition Against Change in Ownership, Management and Control of
the Developer
The qualifications and identity of the Developer are of partIcular concern to the City
and the Agency. It is because of those qualifications and identity that the Agency has entered into this
Agreement with the Developer. No voluntary or involuntary successor in interest of the Developer
shall acquire any rights of powers under this Agreement except as expressly set forth herein.
4849-6618-7776.1
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P Allenda.sAgmda Anaehmenu Aif"ls-Amend ]iJlJ5 .05.11-19 AHl:.PA.Arro.../1ead JO:' n~er HOME Gr.11 Agree-ment doc
The Developer shall not assign all or any part of this Agreement without the prior
written approval of the Agency. This Agreement may be terminated by the Agency if there is any
significant change (voluntary or involuntary) in the management or control of the Developer.
Notwithstanding anything in this Section to the contrary, so long as the Project
contemplated by this Agreement is encumbered by a Department of Housing and Urban Development
("HUD") Deed of Trust and/or Regulatory Agreement, any proposed transferee or assignee must have
the prior written consent of HUD, This Agreement shall not be terminated by the Agency if a
transferee or assignee of this Agreement has the approval of HUD or during the period of time that
AHEPA continues to control not less than fifty-one percent (51 %) of the members and directors of
AHEP A.
Nothing herein shall prohibit the Developer from transferring the Site to HUD or its
transferee without the prior approval of the Agency,
II. [~200] ACQUISITION OF THE SITE
A. [g201] Acquisition of the Site
The Developer represents that it has entered into a contract to acquire the Site, and the
Developer shall acquire title to the Site on or before three (3) business days after receipt of the
proceeds of the Agency Loan.
III. [~300] DEVELOPMENT OF THE SITE
A. [g301] Development of the Site
I. [g302] Scope of Development
The Scope of Development shall be consistent with this Agreement and contain
requirements, standards and limitations customary for comparable projects financed by the Agency.
The Scope of Development is attached to this Agreement as Exhibit "C', The Developer shall prepare
plans for the development of the Site in accordance with the Scope of Development, "Improvements"
shall mean the multifamily housing development to be constructed on the Site, consisting of ninety
(90) dwelling units and amenities as more particularly described in the Scope of Development.
2. [g303] (Intentionally Omitted)
3. [g304] Cost of Work
The cost of all work required by this Agreement as set forth in the Scope of
Development, Exhibit "C", shall be borne by the Developer, except for work or costs expressly set
forth in this Agreement as per Section 400. Notwithstanding the foregoing, in the event that the
Agency requires design standards inconsistent with HUD's cost containment guidelines, the Agency
shall pay the incremental cost (including but not limited to architects' fees, if any) attributable to the
design requirement inconsistent with HUD's cost containment guidelines but not to exceed the amount
of the Agency Grant set forth in Section 406.
4849-66]8-7776.1
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4. [9305] Schedule of Performance
The Developer shall begin and complete all work within the time specified in the
Schedule of Performance (Exhibit "D") or within such extensions of such times as may be granted by
the Agency Interim Executive Director or designee or as provided for in Section 605 of this
Agreement. The Schedule of Performance is also subject to revision from time to time as mutually
agreed upon in writing by and between the Developer and the Agency.
5. [9306] Indemnification; Bodily Injury and Property Damage Insurance
a. During the period of construction on the Site, and throughout the term of
the Agency Loan and the Agency Grant, as applicable, the Developer agrees to and shall defend,
indemnify and hold the Agency and the City harmless from and against all liability, loss, damage, costs
or expenses (including attorney fees and court costs) arising from or as a result of the death of any
person or any accident, injury, loss and damage whatsoever caused to any person or to the property or
any person which shall occur on or adjacent to such Site and which shall be directly or indirectly
caused by any acts done thereon or any errors or omissions of the Developer and its agents, servants,
employees and contractors, but excluding any such liability, loss, damage, costs or expenses arising out
of the negligence of the Agency or a breach by or misrepresentation of the Agency under this
Agreement.
b. Prior to the Closing or receiving any other advance under the Agency
Loan or the Agency Grant, the Developer shall furnish or cause to be furnished to the Agency
duplicate originals of the insurance policy or policies required by this Agreement. The Developer
shall, until the Developer's obligations under this Agreement are paid and discharged in full, maintain
and keep in full force and effect any insurance required by Agency, issued by companies approved by
the Agency including, without limitation:
(I) Fire insurance in an amount not less than the full insurable value
of the Improvements, with extended coverage, including vandalism, malicious mischief, and a loss
payable endorsement naming the Agency as loss payee; and during the construction period and until a
certificate of occupancy for the completed Improvements has been issued by the City, a course of
construction endorsement.
(2) Public liability insurance, to protect against loss from liability
imposed by law for damages on account of personal injury, including death there from, suffered or
alleged to be suffered by any person or persons whomsoever on or about the Site and the
Improvements, or in connection with the operation thereof, resulting directly or indirectly from any
acts or activities of the Agency or the Developer or any person acting for the Agency or the Developer,
or under their respective control or direction, and also to protect against loss from liability imposed by
law for damages to any property of any person occurring on or about the Site and the Improvements, or
in connection with the operation thereof, caused directly or indirectly by or from acts or activities of
the Agency or the Developer or its tenants or any person acting for the Agency or the Developer, or
under their respective control or direction. Such property damage and personal injury insurance shall
also provide for and protect the Agency against incurring any legal cost in defending claims for alleged
loss. Such personal injury and property damage insurance shall name the Agency and the City as
additional insureds. Initially, such personal injury and property damage insurance shall be in the
4849-6618-7776.1
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P Aa:rndasAIen<U Anacllrroel\ls'AJrm-s-Amend 200-'\05.12.19 AHEPA-AfTO...head 302 Ckaptcr HOME Grant Agtremenl doe
following amounts: a general aggregate amount of not less than Three Million Dollars ($3,000,000);
not less than Two Million Dollars ($2,000,000) of bodily injury and property damage insurance; and
not less than Two Million Dollars ($2,000,000) of personal and bodily injury; provided, however, the
limitation on the amount of insurance shall not limit the responsibility of the Developer to indemnify
the Agency or pay damages on account of injury to persons or property resulting from the Developer's
activities or the activities of any other person or persons for which the Developer is otherwise
responsible. The insurance requirements of this subsection shall be modified if the premium cost for
the same is not approved by HUD.
(3) Use and occupancy or business interruption or rental income
insurance with respect to the Improvements against the perils of fire, lightning, vandalism, malicious
mischief, riot and civil commotion, and such other perils ordinarily included in extended coverage fire
insurance policies, in an amount that is acceptable to the Agency (except if the premium cost for such
insurance is not approved by HUD).
(4) Workers' compensation insurance issued by a responsible carrier
authorized under the laws of the State of California to insure employers against liability for
compensation under the workers compensation laws now in force in California, or any laws hereafter
enacted as an amendment or supplement thereto or in lieu thereof. Such workers' compensation
insurance shall cover all persons employed by the Developer in connection with the Site and the
Improvements and shall cover liability within statutory limits for compensation under any such act
aforesaid, based upon death or bodily injury claims made by, for, or on behalf of any person incurring
or suffering injury or death in connection with the Site or the Improvements or the operation thereof by
the Developer.
(5) All required insurance policies shall provide that such insurance
policies shall not be subject to change, cancellation, reduction in coverage, or non-renewal except after
notice in writing shall have been sent by registered mail addressed to the Agency not less than thirty
(30) calendar days prior to the effective date thereof. All policies shall name the Agency and the City
and their elective and appointive boards, officers, agents and employees as additional insureds and
provide that such additional insureds shall not be held liable for any premium or expense of any nature
on such policies or any extensions thereof. All such policies also shall provide that such policy and
coverage as is afforded to the City and the Agency and their elective and appointive boards, officers,
agents and employees shall be primary insurance and not contributing with any other insurance
maintained by the City or the Agency.
(6) The term "full insurable value" as used in paragraph (I) above
shall mean the actual replacement cost (excluding the cost of excavation, foundation and footings
below the lowest floor and without deduction for depreciation) of the Improvements immediately
before such casualty or other loss, including the cost of construction of the Improvements, architectural
and engineering fees, and inspection and supervision. To ascertain the amount of coverage required,
the Developer shall cause the full insurable value to be determined from time to time by appraisal by
the insurer, by agreement between the Agency and the Developer or by an appraiser mutually
acceptable to the Agency and the Developer, not less often than once every three (3) years.
4849-<>618.7776.1 -5-
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(7) All insurance provided under this Section 306b. shall be for the
benefit of the Developer, HUD, the Agency and the City, any mortgagee, and any contractor at the
Developer's discretion. The Developer agrees to timely pay all premiums for such insurance and, at its
sole cost and expense, to comply and secure compliance with all insurance requirements necessary for
the maintenance of such insurance.
(8) The Developer shall submit policies of all insurance required by
this Section to the Agency prior to disbursement of any portion of the Agency or the Agency Grant, as
applicable, as set forth in this Section 306b. At least thirty (30) calendar days prior to expiration of
any such policy, copies of renewal policies shall be submitted to the Agency.
(9) All insurance provided for in this Agreement shall be effected
under policies issued by insurers of recognized responsibility, licensed or permitted to do business in
the State of Cali fomi a reasonably approved by the Agency.
(10) All policies of insurance shall provide that such policies shall not
be canceled or limited in any manner without at least thirty (30) calendar days prior written notice to
the Agency.
(II) If the Developer fails or refuses to procure or maintain insurance
as required by this Agreement, the Agency shall have the right, at the Agency's election and upon ten
(10) calendar days' prior written notice to the Developer and all mortgagees entitled to notice, to
procure and maintain such insurance. The premiums paid by the Agency shall be deemed to be an
additional draw against the principal amount of the Agency Grant provided that the Agency has not
previously concluded all disbursements of the Agency Grant proceeds within the time limitations
required herein or fully funded the principal amount of the Agency Grant.
(12) During the term of the HUD Capital Advance Documents
(defined collectively as the HUD Note, Deed of Trust, Regulatory Agreement, Use Agreement, Capital
Advance Agreement, and Project Rental Assistance Contract), compliance with the insurance
requirements of HUD shall be deemed to satisfy the insurance requirements of this Agreement. The
City and the Agency and their representatives shall be named as additional insureds on any policies of
insurance. In the event of loss covered by fire and extended coverage insurance, the insurance
proceeds, to the extent of the Capital Advance (defined as the amount to be provided in a grant from
HUD) then remaining unpaid, shall be paid to the beneficiary of the HUD deed of trust and, at the
option of the beneficiary, may be applied to the Capital Advance or released for the repair or
rebuilding of the Project. Any balance remaining of insurance proceeds shall be paid to the additional
insured and, at the option of such additional insured, may be applied to the indebtedness owed to such
insured or be released for repair or rebuilding of the Project. Surplus insurance proceeds thereafter
may be dispersed to the Owner of the Project.
6. [9307] Nondiscrimination During Construction; Equal Opportunity
The Developer, for itself and its successors and assigns, agrees that in the construction
of the Improvements on the Site provided for in this Agreement:
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a. The Developer will not discriminate against any employee or applicant
for employment because of race, color, religion, national origin, sex, disability, marital status, sexual
preference, creed, ancestry, medical condition, Acquired Immune Deficiency Syndrome ("AIDS"),
acquired or perceived, or retaliation for having filed a discrimination complaint. The Developer will
take affirmative action to ensure that applicants are employed, and that employees are treated during
employment without regard to their race, color, religion, national origin, sex, disability, marital status,
sexual preference, creed, ancestry, medical condition, AIDS, acquired or perceived, or retaliation for
having filed a discrimination complaint. Such action shall include, but not be limited to, the following:
employment, upgrading, demotion, or transfer; recruitment or recruitment advertising, layoff or
termination; rates of payor other forms of compensation; and selection for training, including
apprenticeship. The Developer agrees to post in conspicuous places, available to employees and
applicants for employment, notices to be provided by the Agency setting forth the provisions of this
nondiscrimination clause.
b. The Developer will, in all solicitations or advertisements for employees
placed by or on behalf of the Developer, state that all qualified applicants will receive consideration for
employment without regard to race, color, religion, national origin, sex, age, disability, marital status,
sexual preference, creed, ancestry, medical condition, AIDS, acquired or perceived, or retaliation for
having filed a discrimination complaint.
c. The Developer will cause the foregoing provisions to be inserted in all
contracts for any work covered by this Agreement so that such provisions will be binding upon each
contractor and subcontractor, provided that the foregoing provisions shall not apply to contracts or
subcontracts for standard commercial supplies or raw materials.
d. Not later than the date established in the Schedule of Performance
(Exhibit "C"), the Developer shall meet with the Agency's or the City's Equal Opportunity Department
staff for a pre-construction briefing on all Agency construction requirernents.
7. [9308] Local, State and Federal Laws
When and if the Developer undertakes the development work contemplated by this
Agreement, the Developer shall carry out the construction of the improvements on the Site in
conformity with all applicable laws, including all applicable federal and state labor standards for the
payment of the required prevailing wage rates.
8. [9309] Prohibition Against Transfer
a. The Developer shall not, except as permitted by this Agreement, assign
or attempt to assign this Agreement or any right herein, nor make any total or partial sale, transfer,
conveyance or assignment of the whole or any part of the Site or the Improvements thereon, without
the prior written approval of the Agency. This prohibition shall not be deemed to prevent the granting
of easements or permits to facilitate the development of the Site or to prohibit or restrict the renting for
occupancy of residential units to be constructed on the Site, nor shall it prohibit granting any security
interests permitted in this Agreement for financing the development of the Site. The provisions of this
Section 309 shall remain in effect for the duration of the Agency Loan and the Agency Grant, as
applicable.
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b. Any proposed transferee shall have the development experience,
qualifications and financial ability necessary to fulfill the obligations undertaken in this Agreement by
the Developer. Any proposed transferee shall expressly assume all of the obligations of the Developer
under this Agreement and shall agree, in a written agreement with the Agency, to be subject to all of
the conditions and restrictions to which the Developer is subject pursuant to this Agreement. The
Developer shall submit to the Agency for review all instruments and other legal documents proposed
to effect any such transfer. Any proposed transferee shall also meet HUD requirements under the
HUD Section 202/811 Capital Advance Documents.
c. In the absence of specific written agreement by the Agency, no
unauthorized sale, transfer, conveyance or assignment of the Site, the Improvements or any part
thereof or interest therein shall be deemed to relieve the Developer or any other party from any
obligations under this Agreement.
d. Notwithstanding anything in this Section 309 to the contrary, the
Developer shall at all times have the right to convey the Site to HUD or its transferee, and so long as
any portion of the HUD Section 202/811 Capital Advance Documents remain outstanding and the
HUD Regulatory Agreement is in effect, the Agency shall approve any sale, transfer, conveyance or
assignment of the Site that first has been approved in writing by HUD; provided, however, that in the
event of any such sale, transfer, conveyance or assignment, the Developer shall not be released from
any obligation under this Agreement without the prior written consent of the Agency.
9. [g310] Security Financing
a. [g311] Encumbrances Permitted
Notwithstanding Section 309, mortgages, deeds of trust, or any other form of
conveyance required for financing are permitted to be recorded against the Site or the Improvements
(the "Security Instruments"') for the purpose of securing funds for the construction of the
Improvements. The Developer shall notify the Agency in advance of any proposed conveyance for
financing. The Developer shall promptly notify the Agency of any Security Instrument or security
interest relating thereto that has been created or attached to the Site or the Improvements, whether by
voluntary act of the Developer or otherwise.
b. [g312] Holder Not Obligated to Construct Improvements
The holder of any Security Instrument authorized by this Agreement ("Holder"')
shall in no way be obligated by the provisions of this Agreement to construct or complete the
Improvements or to guarantee such construction or completion. Nothing in this Agreement shall be
deemed to permit or authorize any such Holder to devote the Site to any uses, or to construct any
improvements provided for or authorized by this Agreement.
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c. [S313] Notice of Default to Mortgage, Deed ofTrust or Other Security
Interest Holders: Right to Cure
Whenever the Agency shall deliver any notice or demand to the Developer with
respect to any breach or default by the Developer in completion of the Improvements on the Site, the
Agency shall at the same time deliver to each Holder, of which the Agency has received notice
pursuant to Section 311 hereof, a copy of such notice or demand. The Agency will cooperate with any
such Holder to the extent reasonably necessary to modify the provisions of this Section 313 to meet the
requirements of such lender. Each such Holder shall (insofar as the rights of the Agency are
concerned) have the right at its option within ninety (90) calendar days after the receipt of the notice to
cure or remedy any such default and to add the cost thereof to the security interest debt and the lien on
its security interest. If such default shall be a default which can only be remedied or cured by such
Holder upon obtaining possession, such Holder shall seek to obtain possession with diligence and
continuity through a receiver or otherwise, and shall remedy or cure such default within ninety (90)
calendar days after obtaining possession; provided that in the case of a default which cannot with
diligence be remedied or cured, or the remedy or cure of which cannot be commenced within such 90-
day period, such Holder shall have such additional time as reasonable necessary to remedy or cure
such default of the Developer. Nothing contained in this Agreement shall be deemed to permit or
authorize such Holder to undertake or continue the construction or completion of the Improvements
(beyond the extent necessary to conserve or protect the Improvements or construction already made)
without first having expressly assumed the Developer's obligations to the Agency by written agreement
satisfactory to the Agency. The Holder in that event must agree to complete, in the manner provided in
this Agreement, the Improvements to which the lien or title of such Holder relates, and submit
evidence satisfactory to the Agency that it has the qualifications and financial responsibility necessary
to perform such obligations. The foregoing provisions of this section shall not apply to HUD during
the term the HUD Capital Advance Documents are in effect.
d. [S314] Failure of Holder to Complete Improvements
In any case where six (6) months after default by the Developer in the
completion of the Improvements the Holder has not exercised the option to complete the construction
of the Improvements, or if it has exercised the option has not proceeded diligently to complete the
Improvements, the Agency may purchase the Security Instrument by payment to the Holder of the
amount of the unpaid debt, plus any accrued and unpaid interest. If the ownership of the
Improvements has vested in the Holder, the Agency, if it so desires, shall be entitled to a conveyance
from the- Holder to the Agency upon payment to the Holder of an amount equal to the sum of the
following:
(I) The unpaid balance secured by the Security Instrument at the
time such title became vested in the Holder (less all appropriate credits, including those resulting from
collection and application of rentals and other income received during foreclosure proceedings).
(2) All expenses with respect to foreclosure.
(3) The net expenses, if any (exclusive of general overhead),
incurred by the Holder as a direct result of the subsequent ownership or management of the
Improvements, such as insurance premiums and real estate taxes.
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(4) The costs of any improvements made by such Holder.
(5) An amount equivalent to the interest that would have accrued on
the aggregate of such amounts had all such amounts become part of the mortgage or deed of trust debt
and such debt had continued in existence to the date of payment by the Agency.
The foregoing provisions of this Section shall not apply during the term of the HUD Capital
Advance Documents.
e. [9315] Right of Agency to Cure Mortgage, Deed of Trust or Other
Security Interest Default
In the event of a default or breach by the Developer of any Security Instrument
prior to the completion of the construction of the Improvements, and the Holder has not exercised its
option to complete such construction, the Agency may cure the default prior to completion of any
foreclosure. In such event, the Agency shall be entitled to reimbursement from the Developer of all
costs and expenses incurred by the Agency in curing the default. The Agency shall also be entitled to a
lien upon the Developer's interest in the Site and ownership of the Improvements (or any portion
thereof) to the extent of such costs and disbursements. Any such lien shall be subordinate and subject
to the Security Instruments recorded against the Site and the Improvements as authorized herein. Any
such lien shall also be subject to the prior written approval of HUD during the term of the HUD
Capital Advance Documents.
10. [9316] (Intentionally Omitted)
11. [9317] Use of the Site
a. [9318] Uses
The Developer covenants and agrees for itself, its successors, its assigns and
every successor in interest that during construction and thereafter, the Developer, its successors and
assignees shall develop the Site with'eighty-nine (89) rental units, and one (I) on-site manager's unit,
in the apartment complex in which each person in residence in each dwelling unit is required to be a
Senior Citizen of sixty-two (62) years of age or older, or a "Qualifying Permanent Resident" as defined
in California Civil Code Section 51.3 and as amended from time to time, and as set forth below
(hereinafter collectively referred to as a "Senior Citizen"). The use of the project shall be at all times
rental units and not be converted to condominiums or other non-rental use. The foregoing covenant
shall run with the land.
Compliance by the Developer with the requirements of the HUD Section 202
program during the term of the HUD Capital Advance Documents shall be deemed to satisfy the
requirements of this section, and in the event of a conflict, HUD requirements shall prevail.
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b. [9319] Obligation to Refrain From Discrimination
Except as otherwise required by the HUD Section 202 program rental
requirements, the Developer covenants by and for itself and any successors in interest that there shall
be no discrimination against or segregation of any person or group of persons on account of race,
color, creed, religion, sex, marital status, ancestry or national origin in the sale, lease, sublease,
transfer, use, occupancy, tenure or enjoyment of the Site, nor shall the Developer itself or any person
claiming under or through the Developer establish or permit any such practice or practices of
discrimination or segregation with reference to the selection, location, number, use or occupancy of
tenants, lessees, subtenants, sub lessees or vendees of the Site. The foregoing covenants shall run with
the land.
c. [9320] Form of Nondiscrimination and Nonsegregation Clauses
The Developer shall refrain from restricting the rental, sale or lease of the Site
on the basis of race, color, creed, religion, sex, marital status, ancestry or national origin of any person.
All such deeds, leases (including rental agreements) or contracts shall contain or be subject to
substantially the following nondiscrimination or nonsegregation clauses:
(I) In deeds: "Except as otherwise required by the HUD Section 202
program rental requirements, the grantee herein covenants by and for himself or herself, his or her
heirs, executors, administrators and assigns, and all persons claiming under or through them, that there
shall be no discrimination against or segregation of any person or group of persons on account of race,
color, creed, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease,
transfer, use, occupancy, tenure or enjoyment of the premises herein conveyed, nor shall the grantee
himself or herself, or any person claiming under or through him or her, establish or permit any such
practice or practices of discrimination or segregation with reference to the selection, location, number,
use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the premises herein
conveyed. The foregoing covenants shall run with the land."
(2) In leases: "Except as otherwise required by the HUD Section 202
program rental requirements, the lessee herein covenants by and for himself or herself, his or her heirs,
executors, administrators and assigns, and all persons claiming under or through him or her, and this
lease is made and accepted upon and subject to the following conditions":
"That there shall be no discrimination against or segregation of
any person or group of persons on account of race, color, creed, religion, sex, marital status, national
origin or ancestry, in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the
premises herein leased, nor shall the lessee himself or herself, or any person claiming under or through
him or her, establish or permit any such practice or practices of discrimination or segregation with
reference to the selection, location. number, use or occupancy of tenants, lessees, subtenants,
sublessees or vendees in the premises herein leased."
(3) In contracts: "Except as otherwise required by the HUD Section
202 program rental requirements, there shall be no discrimination against or segregation of any person
or group of persons on account of race, color, creed, religion, sex, marital status, national origin or
ancestry. in the sale. lease. sublease, transfer. use, occupancy. tenure or enjoyment of the premises, nor
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shall the transferee himself or herself, or any person claiming under or through him or her, establish or
permit any such practice or practices of discrimination or segregation with reference to the selection,
location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the land."
d. [9321] Effect and Duration of Covenants
The covenants contained in this Agreement and the Regulatory Agreement and
Declaration of Restrictive covenants (the "Agency Regulatory Agreement"), attached as Exhibit "E" to
this Agreement shall remain in effect for fifty-five (55) years following the initial occupancy of the
first dwelling unit to be developed pursuant to this Agreement, except that the covenants against
discrimination shall remain in perpetuity. The covenants established in this Agreement and the grant
deed shall, without regard to technical classification and designation, be binding for the benefit and in
favor of the Agency, its successors and assigns, the City and any successor in interest to the Site or any
part thereof.
The Agency is deemed the beneficiary of the terms and provisions of this
Agreement and of the covenants running with the land for and in its own rights and for the purpose of
protecting the interests of the community and other parties, public or private, in whose favor and for
whose benefit this Agreement and the covenants running with the land have been provided. This
Agreement and the covenants shall run in favor of the Agency without regard to whether the Agency
has been, remains or is an owner of any land or interest therein in the Site, any parcel or subparcel, or
in the Project Area. The Agency shall have the right, if the Agreement or covenants are breached, to
exercise all rights and remedies and to maintain any actions or suits at law or in equity or other proper
proceedings to enforce the curing of such breaches to which it or any other beneficiaries of this
Agreement and covenants may be entitled.
e. [9322] Rights of Access-Public Improvements and Facilities
The Agency, for itself and for the City and other public agencies, at their sole
risk and expense, reserves the right to enter the Site or any part thereof at all reasonable times and with
as little interference as possible for the purposes of construction, reconstruction, maintenance, repair or
service of any public improvements or public facilities located on the Site. Any such entry shall be
made only after reasonable notices to the Developer, and the Agency shall indemnify and hold the
Developer harmless from any claims or liabilities pertaining to any entry. Any damage or injury to the
Site resulting from such entry shall be promptly repaired at the sole expense of the public agency
responsible for the entry. ~ .
f. [9323] Affordability Restriction and Tenant Selection
All completed and occupied residential dwelling units on the Site shall, for a
fifty-five (55) year period, be rented at Affordable rental rates to Very Low income households in
accordance with the requirements of 933334.2, et seq., of the California Health & Safety Code and
pursuant to this Section and 24CFR92. Compliance by the Developer with the requirements of the
HUD Section 202 program during the term of the HUD Capital Advance Documents shall be deemed
to satisfy the requirements of this Section and, in the event of a conflict, HUD requirements shall
prevaiL
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g. [9324] Definitions
For the purposes of this Agreement, the following definitions shall apply:
"Very Low income households" means persons and families whose income does
not exceed fifty percent (50%) of Area median income, adjusted for family size in accordance with
adjustment factors adopted and amended from time to time by the United States Department of
Housing and Urban Development pursuant to Section 8 of the United States Housing Act of 1937. The
determination of a household's status as a Very Low income household shall be made upon the initial
occupancy of a unit by the household.
"Area median income" means the median family income ofa geographic area of
the state, as annually estimated in accordance with the United States Housing Act of 1937.
"Affordable rental rates" (including a utility allowance) may not exceed thirty
percent (30%) of fifty percent (50%) of the Area median income for the annual rent, adjusted for
family size appropriate for the unit.
"Qualified Permanent Resident" means a person who meets all of the following
requirements: (A) was residing with the qualifying resident or Senior Citizen prior to the death,
hospitalization, or other prolonged absence of, or the dissolution of marriage with, the qualifying
resident or Senior Citizen; (B) was forty-five (45) years of age or older, or was a spouse, cohabitant, or
person providing primary physical or economic support to the qualifying resident or Senior Citizen;
(C) has an ownership interest in, or is in expectation of an ownership interest in the dwelling unit
within the housing development that limits occupancy, residency, or use on the basis of age.
"Qualifying Resident or Senior Citizen" means a person who is sixty-two (62)
years of age or older, as defined in Section 51.3 of the California Civil Code, and as amended from
time to time.
"Utility allowance" means that amount required for utilities, which are not paid
for by the Developer.
IV. [~400] FINANCING
A. [9401] Method of Financing Acquisition and Development
1. [S402] Sources of Financing
The Agency and the Developer anticipate that the acqUIsItIOn of the Site and
development of the Improvements shall be financed with a combination of grants, as follows:
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Construction and Permanent Financing:
Estimated Amount of Section 202
Capital Advance
Estimated Amount of Agency Grant
Total Estimated Development Cost
$11,199,300
$ 840,000
$12,039,300
2. [g403]
Submittal of Financing Documents
Developer shall obtain the Capital Advance from HUD secured by a first priority deed
of trust in an amount sufficient, together with the Agency Grant, to pay all costs of the Improvements.
Within the time provided therefore in the Schedule of Performance, Developer shall submit for Agency
review and approval copies of the Capital Advance Documents required to obtain the Capital Advance.
Developer shall provide written certification to the Agency that such Capital Advance Documents are
correct copies of the actual documents to be executed by Developer on or before the closing date of the
HUD Section 202 Capital Advance.
A-I. [g403.1]
Agency Loan
The Agency hereby agrees to fund an interim loan to the Developer, which for purposes of this
Agreement is herein defined to be the "Agency Loan". The Agency Loan shall be in a principal
amount not to exceed $840,000 in principal amount and the funds representing the Agency Loan shall
be deposited by the Agency as may be requested by the Developer into the escrow to be established by
the Developer for the purchase of the Site. Such deposit by the Agency shall be made not more than
three (3) business days prior to the anticipated close of escrow for the purchase of the Site by the
Developer. The Developer and the escrow agent shall jointly inform the Agency in writing as to the
date, precise dollar amount and wiring instructions for the deposit of the proceeds of the Agency Loan
into said escrow. The Agency Loan shall not be funded in a principal amount in excess of that amount
as determined by the escrow agent to be necessary for the close of escrow for the Site to occur together
with the payment of all third party costs and fees related to such escrow closing. No portion of the
Agency Loan shall be payable to the Developer whether for direct payments or for reimbursements of
any costs associated with the acquisition of the Site. The Agency Loan proceeds shall only be used for
the acquisition of the Site through the payment of the purchase price thereof and the payment of the
related escrow closing costs and for no other purposes of the Developer, including, but not limited to,
payment of other costs of the Improvements, engineering or architectural design, and obtaining permits
and paying of fees related to the Improvements.
A-2. [g403.2]
Promissory Note and Deed of Trust
The Agency Loan shall be evidence by the Promissory Note substantially in the form as
attached hereto as Exhibit "F" which shall be duly executed and delivered by the Developer and
deposited into the escrow for the acquisition of the Site and released to the possession of the Agency
immediately upon funding the acquisition of the Site and the recordation of the Deed of Trust
substantially in the form as attached hereto as Exhibit "0". The Deed of Trust shall be duly executed
and delivered by the Developer designating the Agency as the beneficiary thereof to secure the
repayment of the Agency Loan as shall be evidenced by the Promissory Note. Such Deed of Trust
shall be a duly recorded first lien upon the Site subject only to general and special property taxes that
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have not then been levied by the County of San Bernardino. The Deed of Trust shall not be subject to
subordination by the Agency under any circumstances. It is the intent and understanding of the
Developer that the Developer will be required to repay the Agency Loan in whole in order to seek a
reconveyance of the Deed of Trust. The Developer represents and warrants that funds are available
within the appropriate line item budget of the HUD Section 202 Capital Advance equal to $840,000 for
the purpose of land acquisition, and such amount may legally be used and applied by the Developer for
the repayment in whole of the Agency Loan as is allowed by HUD pursuant to applicable regulations.
A-3. [9403.2]
Terms of Agency Loan
The Agency Loan shall have a term of one (I) year and shall be due and payable in full as of
said maturity date, which shall be one (I) year from the date of the Agency Loan. In the event that the
Agency Loan is paid in whole within said one-year period of time, the Agency Loan shall not bear
interest. However, in the event all or any portion of the Agency Loan is not paid on or before the one-
year maturity date, that portion of the principal amount thereof which remains unpaid as of the
maturity date shall bear interest at the compound rate of interest equal to three percent (3%) per annum
calculated on a daily basis on a 365/366 actual calendar days basis from the original date of the
Agency Loan until paid thereafter in whole or in part as to any partial principal payment. Interest on
the Agency Loan shall be calculated on the unpaid principal balance of the Agency Loan for any
principal amounts thereof that are not paid on or before the maturity date thereof with interest to
thereupon be calculated on such unpaid amount from the date of the Agency Loan.
B. [9404] Agency Grant
In accordance with and subject to the terms and conditions of this Agreement, and provided
that the Agency Loan has been repaid in whole prior to the maturity date thereof, the Agency agrees to
grant to the Developer, and the Developer agrees to accept from the Agency, funds in an amount set
forth in Section 406 for construction and permanent financing of site improvements and design
amenities only. The Developer recognizes and agrees that the sole source of funds for the funding the
Agency Grant shall be the repayment amounts of the Agency Loan as shall be remitted by the
Developer to the Agency in accordance with the Agency Loan as shall be evidenced by the Promissory
Note. In the event the source of funds from the Agency which shall be used to fund the Agency Loan
and thereafter the Agency Grant are HOME Funds, the use of such funds shall be subject to all
requirements of the HOME Funds program and in the event of a conflict between the HUD
requirements and the HOME requirements, the matter shall be submitted to HUD for determination.
The parties acknowledge that the HOME Funds are to be utilized to pay costs not included within the
HUD Capital Advance Funds proceeds and such funds shall be disbursed to the Developer in such
escrow as HUD approves to be paid out in the course of construction. The Agency acknowledges that
the Agency Grant funds are to pay for costs not included within the HUD Capital Advance to include
only those items enumerated as follows: off-site and adjacent public improvements within street
rights-of-way including street roadways, sidewalks, curb and guller, street lighting, undergrounding of
overhead utilities and installation of signal lights ('"Off-Site Improvements"); construction of
additional amenities and upgrades to the Improvements which the Agency Interim Executive Director
and the Developer may hereafter mutually agree are beneficial to upgrade the exterior of the
Improvements by the expenditure of funds in excess of those funds which are available to the
Developer from the HUD Capital Advance proceeds ("Exterior Amenity Upgrades"); and any other
amenities and upgrades within the dwelling units which the Agency Interim Executive Director and the
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Developer may hereafter agree are beneficial to the Improvements by the expenditure of funds in
excess of those funds which are available to the Developer from the HUD Capital Advance proceeds
nnterior Amenity Upgrades") For purposes hereof, the Off-Site Improvements, the Exterior Amenity
Upgrades and the Interior Amenity Upgrades are collectively referred to herein as the "Agency Grant
Eligible Improvements". The Agency Grant funds shall be disbursed only after it has been mutually
agreed upon in the manner as set forth above.
I. [~405] Submittal of Proposed Budget for Agency Grant Eligible Improvements
As soon as practicable after the date of this Agreement, the Developer shall submit to the
Agency a proposed budget setting forth by line item those expenditures plus the dollar amounts thereof
which are then considered by the Developer to constitute the Agency Grant Eligible Improvements.
The Interim Executive Director shall have the sole discretion to approve or disapprove any such line
item and the decision of the Interim Executive Director shall be final and non-appeallable. The
Developer shall not undertake any item, which was denied for approval by the Interim Executive
Director except with other available funds of the Developer and not from the Agency Grant. The
actual dollar amount of each of the Agency Grant Eligible Improvements shall be based upon invoices
received by the Developer and submitted to the Agency for the payment thereof from the proceeds of
the Agency Grant for those qualifying Agency Grant Eligible Improvements. In the event that the total
cost of the Agency Grant Eligible Improvements should exceed the principal amount of the Agency
Grant, the Agency shall have no further obligation or duty to remit any further amounts to the account
of the Developer, and the Developer shall seek other sources of funds for the payment of all such
excess costs of the Agency Grant Eligible Improvements and the remainder of the Improvements if not
funded from the HUD 202 Capital Advance.
2. [S406] Amount of Agency Grant; Time Limitations
The final principal amount of the Agency Grant shall not exceed the lesser of (i) the
actual costs of the Agency Grant Eligible Improvement costs, or (ii) the amount repaid pursuant to the
Agency Loan in a timely manner prior to the request to fund the Agency Grant and prior to the
maturity date thereof, or (iii) 5;840,000. The Agency Grant shall be funded prior to the date that the
City issues its certificate of occupancy for the Improvements as then may have been constructed upon
the Site. The Agency shall have no further authority or obligation to the Developer under this
Agreement to disburse any portion of the Agency Grant after the date that the City so issues its
certificate of occupancy for the Improvements.
3. [S407] Conditions Precedent to Closing of Agency Grant
Disbursement of the Agency Grant shall be conditioned on the Developer meeting all
conditions of the HUD Firm Commitment for Section 202 Capital Advance funding acceptable to the
Developer in compliance with all requirements of the City including plans and specifications approved
by the City, all building permits, execution of all certificates for all insurance policies required as set
forth in Section 306 of this Agreement.
4849-6618.7776_1
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P."~cr,J~.Abcnd. "\l;.~Mm~nlh"grma_AmcnJ :OO50S.1:.]'f AHEPA_Arro"hcad JO~ Chapter HOME Gram Ai:'crmcnld,,,,
At the time established in the Schedule of Perfonnance and, in any event, prior to
disbursement of any portion of the Agency Grant, the Developer shall deliver to the Agency the
following documents or instruments, all of which shall be in full force and effect at the time of
disbursement of any portion of the Agency Grant:
a. All building pennits.
b. A proposed construction contract between the Developer and a licensed
general contractor approved by HUD covering all construction required by this Agreement.
c. A construction budget, current as of the date of disbursement,
demonstrating to the satisfaction of the Agency the availability of sufficient funds to construct the
Improvements.
d. A copy of a completion bond and a payment bond, each in the amount of
one hundred percent (100%) of the amount of the construction contract in favor of HUD and the
Developer or, alternatively, evidence satisfactory to HUD of a cash deposit of twenty-five percent
(25%) of such amount.
e. A copy of the Finn Commitment for the HUD Section 202/811 Capital
Advance acceptable to the Developer. The Developer shall also provide the Agency with evidence that
equity funds are available to fund the portion of Development Costs, if any, not funded by the HUD
Section 202/811 Capital Advance and the Agency Grant.
f. A soils report satisfactory to the Agency, including a statement of
whether or not the Site is in an earthquake hazard area and an engineering study regarding earthquake
design, and the qualifications and experience of the soils engineer preparing such report.
g. An environmental assessment prepared by a qualified engineer
acceptable to the Agency relating to the presence of Hazardous Substances in, on or around the Site,
and confinning that all Hazardous Substances described in such assessment have been removed or
mitigated in accordance with law, aIid that the condition of the Site will not result in liability for
cleanup of the Site by the Developer or the Agency under applicable law.
h. Duplicate originals of all insurance policies required as set forth In
Section 306 of this Agreement.
i. Documents relating to the Developer's corporate existence, including:
copies of Developer's Articles of Incorporation together with any and all amendments thereto, certified
as of a recent date by the Secretary of State of California; a certified copy of the Developer's Bylaws
together with any and all amendments thereto; and a certificate of status of the Developer, issued on a
recent date by the California Secretary of State.
j. Deposit in escrow of the financing documents required to cause the HUD
Section 202/811 Capital Advance proceeds to be committed and available, in an amount sufficient,
when combined with the Agency Grant, to complete the construction of the Improvements.
4849-66] 8-7776.]
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4. [9408] Defaults Following Closing of Agency Grant
In the event that the Developer, on or before the date established in the Schedule of
perfonnance for such action, fails:
a. to complete construction of the Improvements within the time provided
in the Schedule of Perfonnance;
b. to fulfill its obligations to the Agency under this Agreement, or any
agreement or instrument executed in connection herewith; or
c. to close the HUD Section 202/811 Capital Advance;
The Agency, at its option, may declare the Developer to be in default and require repayment of the
Agency Grant; provided, however, that during the period the HUD Capital Advance Documents are in
effect, the Agency may not declare acceleration of repayment of the Agency Grant.
5. [9409] Repayment of Agency Grant
a. The Agency Grant shall be repaid immediately if the Project, or any
portion thereof or interest therein, is sold, transferred, assigned or refinanced without the prior written
consent of the Agency; provided, however, that during the tenn of the HUD Capital Advance
Documents the foregoing shall not apply to a transfer to HUD or to a transferee approved by HUD and
any such repayment shall be made only from residual receipts and is subject to the approval ofHUD.
b. In the event the Project is sold or refinanced during the tenn of this
Agreement, with or without the prior written consent of the Agency, the Net Proceeds of such sale or
refinancing shall be paid to the Agency to the extent necessary to repay in full the Agency Grant,
provided that during the tenn of the HUD Capital Advance Documents any such proceeds be first
applied to pay any project expenses, repairs and reserves required by HUD.
c. The tenn of this Agreement shall be fifty-five (55) years from the date of
issuance of the Certificate of Occupancy but not before the maturity date of the HUD Capital Advance
Documents.
v. [~5001 DEFAULTS, REMEDIES AND TERMINATION
A. [9501] Defaults - General
Subject to the extensions of time set forth in Section 60S, failure or delay by either party to
perfonn any tenn or provision of this Agreement, or the breach of any representation or warranty,
constitutes a default under this Agreement. The party who so fails or delays shall immediately
commence to cure, correct or remedy such failure or delay and shall complete such cure, correction or
remedy with reasonable diligence and, during any period of curing, shall not be otherwise in default of
this Agreement.
4849-Q618.7776.1 -18-
p ~..AgenQa Ana;hmmlilAerrru-Ammd 200j\O~.12-19 "HEPA.Arrowhead 302 Chapter HOME Granl Agrttmml doc
The injured party shall given written notice of default to the party in default, specifying the
default complained of by the injured party.
Any failures or delays by either party in asserting any of its rights and remedies as to any
default under this Agreement shall not operate as a waiver of any default or of any such rights or
remedies arising pursuant to such default; nor shall it change the time of default following written
notification from the non-defaulting party. Any such delays or failure by either party in asserting any
of its rights and remedies shall not deprive any party of its right to institute and maintain any actions or
proceedings, which it may deem necessary to protect, assert or enforce any such rights or remedies.
B. [9502] Legal Actions
I. [9503] Institution of Legal Actions
In addition to any other rights or remedies, either party may institute legal action to
cure, correct, or remedy any default to recover damages for any default, or to obtain any other remedy
consistent with the purpose of this Agreement. Such legal actions must be instituted in the Superior
Court of the County of San Bernardino, State of California, in any other appropriate court in that
County, or in the Federal District Court for the Central District of California.
2. [9504] Applicable Law
The laws of the State of California shall govern the interpretation and enforcement of
this Agreement.
3. [9505] Acceptance of Service of Process
If any legal action is commenced by the Developer against the Agency, service of
process on the Agency shall be made by personal service upon the Interim Executive Director or
Chairperson of the Agency, or in such other manner as may be provided by law.
If any legal action is commenced by the Agency against the Developer, service of
process on the Developer shall be made by personal service upon an authorized officer or general
partner or managing member, as applicable, or in such manner as may be provided by law, and shall be
valid whether made within or outside the State of California.
C. [9506] Rights and Remedies are Cumulative
Except with respect to rights and remedies expressly declared to be exclusive in this
Agreement, the rights and remedies of the parties are cumulative, and the exercise by either party of
one or more of such rights or remedies shall not preclude the exercise by it, at the same or different
times, of any other rights or remedies for the same default or any other default by the other party.
4849-6618.7776.] -19-
p ~md.a.5'AitmdJ, AnKhmmt5\AimU.Amend 200',0'.12-19 AHEPA.Nro""'1Icad 302 C"hapI('l' HOME Gram Aircerrenl doc
D. [9507] Damages; Specific Perfonnance
If either party defaults with regard to any of the provisions of this Agreement, the non-
defaulting party shall serve written notice of such default upon the defaulting party. If the default is
not cured by the defaulting party within ninety (90) calendar days after service of the notice of default,
or if the default is not commenced to be cured within ninety (90) calendar days after service of the
notice of default and is not cured diligently within a reasonable period of time after commencement,
the defaulting party shall be liable to the other party for damages caused by such default, and the non-
defaulting party, at its option, may institute an action for specific perfonnance of the tenns of this
Agreement.
E. [9508] Remedies and Rights ofTennination
1. [9509] Tennination by the Developer
The Developer, at its option, may tenninate this Agreement if the Agency is in default
of its obligations under this Agreement and such default is not cured within ninety (90) calendar days
after written notice by the Developer, or if the Developer fails to obtain a Finn Commitment for
Capital Advance Financing from HUD on tenns satisfactory to the Developer. Tennination by the
Developer shall not tenninate the provisions of the Promissory Note and Deed of Trust and all other
covenants contained herein which run with the land.
2. [9510] Tennination by Agency
The Agency, at its option, may tenninate this Agreement if any of the following occur:
(i) the Developer assigns or attempts to assign this Agreement, or any rights therein, or makes any total
or partial sale, sublease, transfer or conveyance of the whole or any part of the Site or the Project,
except as pennitted by this Agreement; and (ii) subject to force majeure, the Developer is in default of
any of its obligations under this Agreement, and such default is not cured within ninety (90) calendar
days after the date of written demand therefore by the Agency provided, however, that this Agreement
shall not be tenninated during the tenn of the HUD Capital Advance Documents without the prior
written approval ofHUD.
VI. [96001 GENERAL PROVISIONS
A. [9601] Notices, Demands and Communications Between the Parties
Fonnal notices, demands and communications between the Agency and the Developer shall be
sufficiently given if dispatched by registered or certified mail, postage prepaid, return receipt
requested, to the principal offices of the Agency and the Developer as designated in Section 104 and
105 hereof. Such written notices, demands and communications may be sent in the same manner to
such other addresses as either party may from time to time designate by mail as provided in this
Section 60 I.
'849-6618.7776.1
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f Agen.J.u Ajend.a Atuaunents'Aiml.s.ArrlfnJ 2005.05.12.19 AHEPA.Arro...11ud ~O~ Ch~lr;r HOME Gr",l Agrftmml doc
B. [9602] Conflict of Interests
No member, official or employee of the Agency shall have any personal interest, direct or
indirect, in this Agreement nor shall any such member, official or employee participate in any decision
relating to the Agreement which affects his or her personal interests or the interests of any corporation,
partnership or association in which he or she is directly or indirectly interested.
C. [9603] Warranty Against Payment of Consideration for Agreement
The Developer warrants that it has not paid or given, and will not payor give, any third party
any money or other consideration for obtaining this Agreement.
D. [9604] Non-liability of Agency Officials and Employees
No member, official or employee of the Agency or of the Developer shall be personally liable
to the other party or any successor in interest, in the event of any default or breach by the Agency or
the Developer for any amount which may become due to the Developer or the Agency or its successor,
or on any obligations under the terms of this Agreement.
E. [9605] Enforced Delay; Extension of Time of Performance
Notwithstanding specific provisions of this Agreement, performance by either party hereunder
shall not be deemed to be in default where delays or defaults are due to war, insurrection, strikes, lock-
outs, riots, floods, earthquakes, fires, casualties, acts of God, acts of the public enemy, epidemics,
quarantine restrictions, freight embargoes, lack of transportation, governmental restrictions or priority,
litigation including litigation challenging the validity of this transaction or any element thereof,
unusually severe weather, inability to secure necessary labor, materials or tools, delays of any
contractor, subcontractor, or suppliers, acts of the other party, acts or failure to act of the City, the
Agency or any other public or governmental agency or entity (other than that acts or failure to act of
the Agency or the City shall not excuse performance by the Agency), or any other causes beyond the
control or without the fault of the party claiming an extension of time to perform.
An extension of time for any such cause shall be for the period of the enforced delay and shall
commence to run from the time of the commencement of the cause, if notice by the party claiming
such extension is sent to the other party within thirty (30) calendar days after the commencement of the
cause. Times of performance under this Agreemeht may also be extended in writing by the Agency
and the Developer.
F. [9606] Inspection of Books and Records
The Agency or its designee has the right at all reasonable times to inspect the books, records
and other documents of the Developer pertaining to the Site, the Agency Grant Eligible Improvements
and/or the Project pertinent to the purposes of this Agreement.
4849--6618-7776.1
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PAgcnda.5.ARcnda ,"n~tllr~1l(5'.Agm'u.Amcnd ~OOS",OS-12-19 AHEPA-AAO"'hcitd ]02 cn~C'f HOME Gralll Agleemenl do<:
G. [9607J Approvals
Approvals required of the Agency or the Developer shall not be unreasonably withheld, and
approval or disapproval shall be given within the time set forth in the Schedule of Perfonnance or, if
no time is given, within a reasonable time.
H. [9608J Minor Modifications to Agreement
The Developer and the Agency presently believe that the tenns and provIsIOns of this
Agreement are consistent with and accommodate the final fonn of the HUD Section 202 Capital
Advance Documents as may hereafter be required by HUD. However, the Developer and the Agency
acknowledge and recognize that certain minor modifications of this Agreement may be necessary to
accommodate the final fonn of one or more of the various HUD Section 202 Capital Advance
Documents for the Project as may be reasonably required by HUD. The Agency Interim Executive
Director shall be the Agency officer authorized to act for the Agency pursuant to this Section 608.
Accordingly, the Agency and the Developer agree on a best efforts basis to consider making
reasonable accommodations and if necessary to approve such minor technical and confonning
appropriate written modifications of this Agreement (and any exhibit attached hereto) as required to
accommodate the final fonn of the HUD Section 202 Capital Advance Documents for the Project and
to close the escrow for the acquisition of the Site with the proceeds of the Agency Loan; provided,
however, that the acknowledgment of the parties under this Section 608, shall not be deemed to require
or compel the approval of any particular technical or confonning modification of this Agreement by
either party based upon a good faith exercise of business judgment of a party and the failure of either
party to approve such a technical or confonning modification of this Agreement shall not be deemed to
be a default hereunder.
VII. 1~700] ENTIRE AGREEMENT, WAIVERS, AMENDMENTS AND HUD PROVISIONS
This Agreement shall be executed in three (3) duplicate originals, each of which is deemed to
be an original. This Agreement includes twenty-three (23) pages and seven (7) Exhibits, which
constitute the entire understanding and agreement of the parties.
This Agreement integrates all of the terms and conditions mentioned herein or incidental
hereto, and supersedes all negotiations or previous agreements between the parties with respect to the
Agency Loan and the Agency Grant.
All waivers of the provisions of this Agreement must be in wntmg and signed by the
appropriate authorities of the Agency and the Developer, and all amendments hereto must be in writing
and signed by the appropriate authorities of the Agency and the Developer.
Notwithstanding anything to the contrary in this Agreement, ifany provision of this Agreement
tends to contradict, modify or in any way change the terms of the Regulatory Agreement encumbering
the Site to be entered into between the Secretary of HUD and the Developer, the terms of the
Regulatory Agreement shall prevail and govern; or if any provision of this Agreement in any way
tends to limit the Secretary of HUD in his administration of the Housing Act of 1959, as amended, or
the regulations pursuant thereto, this Agreement shall be deemed amended so as to comply with the
4849-6618.7776 I
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? AgC'l'MU$'.Agcndll ^nao:;hmentl\Agmu-Amc:nd ~OO5'(J5.1~.19 AIlEPA-ArTO..hcad JlI:! Chapler HOME Grilnl A,rtoe_nl doc
Act, Regulations and the Regulatory Agreement. No other amendment to this Agreement shall be
effective without the prior written approval of the Secretary. Notwithstanding anything herein to the
contrary, if the Secretary of HUD should take title to the Site through foreclosure, deed in lieu of
foreclosure, or otherwise, all covenants, conditions and restrictions set forth in this Agreement shall
cease and terminate and be of no further force and effect.
VIII. 1~800] TIME OF ACCEPTANCE OF AGREEMENT BY AGENCY
This Agreement, when executed by the Developer and delivered to the Agency, must be
authorized, executed and delivered by the Agency within thirty (30) calendar days after the date of
signature by the Developer, or this Agreement may be terminated by the Developer on written notice
to the Agency.
IX. (~900] PARTIAL INVALIDITY
If any term or provision of this Agreement or of the Exhibits hereto shall to any extent be
determined invalid or unenforceable by a court of competent jurisdiction, the remainder of all such
documents and instruments and each term and provision thereof shall be valid and be enforced to the
fullest extent permitted by law.
IN WITNESS WHEREOF, the undersigned have executed this Agreement on the dates written
opposite their signature below.
AGENCY
REDEVELOPMENT AGENCY
OF THE CITY OF SAN BERNARDINO
a public body, corporate and politic
Date:
By:
Maggie Pacheco, Interim Executive Director
DEVELOPER
AHEPA NATIONAL HOUSING CORPORATION-
AHEPA LOCAL ARROWHEAD 302 CHAPTER
ELDERLY HOUSING,
a California nonprofit corporation
Date:
By:
APPROVED AS TO FORM:
By: i<?~/~
Agency unsel
4849-6618-7776.1
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PIAi;CfIGas''^acnda Ana.:hmml$\Aamu-Amcnd 200~ .03.12.1 Q AHEPA-Mowt\ead J02 Chapler HOME Granl AglUIT'IC1l1 due
Act, Regulations and the Regulatory Agreement. No other amendment to this Agreement shall be
effective without the prior written approval of the Secretary. Notwithstanding anything herein to the
contrary, if the Secretary of HUD should take title to the Site through foreclosure, deed in lieu of
foreclosure, or otherwise, all covenants, conditions and restrictions set forth in this Agreement shall
cease and terminate and be of no further force and effect.
VIII, [~800] TIME OF ACCEPTANCE OF AGREEMENT BY AGENCY
This Agreement, when executed by the Developer and delivered to the Agency, must be
authorized, executed and delivered by the Agency within thirty (30) calendar days after the date of
signature by the Developer, or this Agreement may be terminated by the Developer on written notice
to the Agency.
IX. (~900] PARTIAL INVALIDITY
If any te.rm or provision of this Agreement or of the Exhibits hereto shall to any extent be
determined invalid or unenforceable by a court of competent jurisdiction, the remainder of all such
documents and instruments and each term and provision thereof shall be valid and be enforced to the
fullest extent permitted by law.
IN WITNESS WHEREOF, the undersigned have executed this Agreement on the dates written
opposite their signature below.
AGENCY
REDEVELOPMENT AGENCY
OF THE CITY OF SAN BERNARDINO
a public body, corporate and politic
Date:
By:
Maggie Pacheco, Interim Executive Director
DEVELOPER
AHEP A NATIONAL HOUSING CORPORA nON -
AHEP A LOCAL ARROWHEAD 302 CHAPTER
ELDERLY HOUSING,
a California nonprofit corporation
Date:
By:
APPROVED AS TO FORM:
By: t1~i:tp l(2jJ~UQj
Agency C nsel
4849-<>618-7776.1 -23-
, \Aeerw;IaJ'Aaenda AruclImmll\Aim'll-Ammd 200'\0)'-12.19 AHEPA.Arro....head 30: Chapter HOME Grilli ^~ dol;
Act, Regulations and the Regulatory Agreement. No other amendment to this Agreement shall be
effective without the prior written approval of the Secretary. Notwithstanding anything herein to the
contrary, if the Secretary of HUD should take title to the Site through foreclosure, deed in lieu of
foreclosure, or otherwise, all covenants, conditions and restrictions set forth in this Agreement shall
cease and terminate and be of no further force and effect.
VIII. [~800J TIME OF ACCEPTANCE OF AGREEMENT BY AGENCY
This Agreement, when executed by the Developer and delivered to the Agency, must be
authorized, executed and delivered by the Agency within thirty (30) calendar days after the date of
signature by the Developer, or this Agreement may be terminated by the Developer on written notice
to the Agency.
IX. [~900J PARTIAL INVALIDITY
If any term or provision of this Agreement or of the Exhibits hereto shall to any extent be
determined invalid or unenforceable by a court of competent jurisdiction, the remainder of all such
documents and instruments and each term and provision thereof shall be valid and be enforced to the
fullest extent permitted by law.
IN WITNESS WHEREOF, the undersigned have executed this Agreement on the dates written
opposite their signature below.
AGENCY
REDEVELOPMENT AGENCY
OF THE CITY OF SAN BERNARDINO
a public body, corporate and politic
Date:
By:
Maggie Pacheco, Interim Executive Director
DEVELOPER
AHEPA NATIONAL HOUSING CORPORATION-
AHEPA LOCAL~ARROWHEAD 302 CHAPTER
ELDERLY HOUSING,
a California nonprofit corporation
Date:
By:
APPROVED AS TO FORM:
B, ;I),#~
Agency C el
4849-6618-7776.1 -23-
P \Allmdas'I.A,eNa Anachrnenu\AJFM$-Amrnd 200~\OS.12-19 AHEPA.Arro",head 302 Chapter HOME Gnnl ^~ doc
EXHIBIT "A"
SITE MAPS
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EXHIBIT "B"
LEGAL DESCRIPTION
PARCEL 1 OF PARCEL MAP 6660, AS PER MAP RECORDED IN BOOK 67, PAGES 16
AND 17 OF PARCEL MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID
COUNTY.
4~49-0618~7776.1
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EXHIBIT "C"
SCOPE OF DEVELOPMENT
A. General Proiect Description
The Site contains approximately 107,157 square feet. The Project shall consist of
the construction of eighty-nine (89) one (1) bedroom units designated as
affordable housing for senior citizens of very low income, as defined by federal
law and regulations, and one (I) two (2) bedroom manager's unit.
B. Design Objectives
The following is a statement of design objectives for development of the Site:
I. The creation and achievement of an attractive and pleasant environment
reflecting a high level of concern for architectural and urban design
principles both in terms of the development itself and its compatibility and
suitability with the surrounding community.
2. The provision of a pleasing, safe and well-maintained living environment and
vehicle parking in an urban environment.
C. Development Standards
The Project shall be designed and constructed in accordance with the approved
terms and conditions of approval of the land use entitlements approved by the
City of San Bernardino for this Project, attached hereto and incorporated herein
by reference.
D. Lot Consolidation
The Developer shall be responsible for consolidating the parcels and shall adhere
to the City's Public Work requirements when consolidating lots.
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EXHIBIT "D"
SCHEDULE OF PERFORMANCE
Evidencim! of Financinl!
Developer provided Agency with evidence of
financing for the Project pursuant to Section 400 of the
Agreement.
November 2005, unless extended for up to
six months by HUn.
Fundinl! of Al!encv Interim Loan: Closinl! of Escrow
for Acauisition of Site
On or before January 7, 2006
Desil!n
Developer shall prepare all plans and specifications
and obtain all required permits.
No later than April 30, 2006.
Evidence of Insurance
Developer shall furnish to the Agency, a certificate of
insurance as set forth in Section 306 of the Agreement.
Prior to the Developer or its agents
commencing construction of the Site.
Ooeninl! of Escrow
Developer shall open escrow to complete HUn Initial
Closing
Within 30 calendar days of written request
from Developer.
Al!encv Fundinl!
On or before HUn Initial Closing.
HUn Initial Closing
On or before July 30, 2006
Fundinl! of Al!encv Grant
Concurrent with the HUD Initial Closing
On or before July 30, 2006
Commencement of Construction
Developer shall commence construction of the
improvements of the Site pursuant to Section 305 and
Exhibit "D".
Within ten (10) calendar days of HUn
Initial Closing.
Comoletion of Construction
Developer shall complete the construction of all
improvements on the Site as well as off-site
improvements.
Within 365 calendar days after HUn
Initial Closing or as extended by HUn.
The summary of the items performance in this Schedule of Performance is not intended to supersede or
modify the more complete description in the text: in the event of any conflict of inconsistency between
this Schedule of Performance and the text of the Agreement, the text shall govern.
The time periods set forth in this Schedule of Performance may be altered or amended only by written
agreement signed by both the Developer and the Agency. The Interim Executive Director of the Agency
shall have the authority to approve extensions of time without action of the Community Development
Commission of the Agency not to exceed a cumulative total of 180 calendar days.
4849-6618-7776.1
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EXHIBIT "E"
REGULATORY AGREEMENT AND
DECLARATION OF RESTRICTIVE COVENANTS
4849-6618-7776.1
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RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
Redevelopment Agency
of the City of San Bernardino
Attn.: Interim Executive Director
201 North "E" Street, Suite 301
San Bernardino, California 92401
Record~ng Fee Exempt Pursuant to Government Code Section 6103
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
AGENCY REGULATORY AGREEMENT
AND
DECLARATION OF RESTRICTIVE COVENANTS
(HOME Program 24 Code of Federal Regulation
Part 92; Health and Safety Code Section 33334.2)
THIS AGENCY REGULATORY AGREEMENT AND DECLARATION OF
RESTRICTIVE COVENANTS (the "Agency Regulatory Agreement") is made
a~Q en cered into as of this 2005, by and
bee ween the Redevelopment Agency of the City of San Bernardino, a
body corporate and politic (the "Agency") and AHEPA National
Housing Corporation-AHEPA Local Arrowhead 302 Chapter, Inc., a
California nonprofit corporation (the "Developer").
--RECITALS--
A. The Agency and the Developer have entered into that
cer:ain HOME Funds .Loan a!1d Grant Agreement, dated as
of , 2005 (the "A9reement") A copy of the Agreement
lS 0!1 file with the Agency Secretary.
B. Pursuant to the terms of the Agreement, the Agency will
prov~de resources to the Developer for improvement of the
"Project" subject to the conditions of the "HUD Capital Advance
Documents", as these terms are more specifically described in the
Agreement, and the Agency has agreed to provide the Developer with
an Agency HOME Funds Loan and Grant Agreement in support of the
ProJect, subject to certain conditions.
C. In consideration for the Agency HOME Funds Loan and
Grant .;greement, the Developer has agreed to maintain a certain
~umber of the rental dwelling units in the Project as available at
"affordable rent" to low income Senior Citizen Households as these
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terms are oefined in the Agreement for the term of this il.gency
Regulatory Agreement and to further agree to observe all the terms
and conditions set forth below.
D. The Agency has agreed to provide the Agency HOME Funds
~oan and Grant Agreement on the condition that the proj ect be
maintained and operated in accordance with Health and Safety Code
Sections 33334.2 and 33413 and in accordance with certain
additional restrictions concerning affordability, operation, and
maintenance of the Project, as specified in this Agency Regulatory
Agreement.
E. In order to ensure that the proj ect will be used and
operated in accordance with these conditions and restrictions, the
.n.gency, and the Developer wish to enter into this Agency
Regulatory Agreement for themselves and their successors and
assigns.
THEREfORE, THE REDEVELOPMENT AGENCY OF THE CITY OF SAN
BERNARDINO, ITS SUCCESSORS AND ASSIGNS AND AHEPA National Housing
Corporation and il.HEPA Local .n.rrowhead Chapter 302, ITS SUCCESSORS
AND ASSIGNS HEREBY COVENANT AND AGREE AS FOLLOWS:
ARTICLE 1
DEFINITIONS
1.1 Definitions When used in this Agency Regulatory
i"'-.::Jreement, certain terms and phrases as denoted by an initially
capitallzed letter shall have the same meaning as found in the
.n.greement unless the specific context of the usage of a term or
phrase may otherwise require, and certain additional defined terms
which appear below in this Section 1.1 shall have the meaning in
~~is Agency Regulatory Agreement as ascribed below:
a. "Adjusted Income" shall mean the total anticipated annual
income of all persons in a household which occupies (or is
proposed to occupy) a Unit as calculated in accordance with
25 California Code of Regulations Section 6914 or pursuant
to a successor state housing program regulation that
utilizes a reasonably similar method of calculation of
adjusted annual income. In the event that no such program
exists, the Agency shall provide the Developer with a
reasonably similar method of calculation of adjusted income
as provided in 25 California Code of Regulations Section
6914.
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b. "Agreement" means that certain Agency Regulatory
Agreement and Declaration of Restrictive Covenants dated
as of 2005, by and between the
Developer and the Agency. A copy of the Agreement is on
file with the Agency Secretary and is incorporated
herein by this reference.
c.
"Certificate
issuance by
occClpancy for
of
the
the
Occupancy
City of
Project.
Date" means
the initial
the date
certificate
of
of
d. "City" shall mean the City of San Bernardino, California.
e. "Closing Date" shall mean the date of recordation of
this Agency Regulatory Agreement.
f. "l-!Ol';E .;ssisted Units" shall mean the ninety (90) rental
Units in the Project.
g. "Management Agent" shall mean the experienced management
agent selected by the Developer for the management of
Project as provided in Section 5.2 of this Agency
Regulatory Agreement.
h
u.
"Developer"
Chapter, a
ccrporation.
shall mean
California
Al-!EP.; Local
nonprofit
Arrowhead 302
public benefit
1. "Site" shall mean the real property described in Exhibit
"A" attached hereto and incorporated herein.
j .
"Agency Regulatory Agreement" shall mean
Regulatory Agreement and Declara~ion of
Covenants.
this Agency
Restrictive
k. "Rent" shall mean the total of each monthly payment by
the cenants of a Unit to the Developer for the
follOl-ling: use and occupancy of the Unit and land and
associated facilities, including parking (other than
parking services acquired by tenants on an optional
basis); any separately charged fees or service charges
assessed by the Developer which are required of all
tenants, other trlan security deposits; the cost of an
adequate level of service for utilities paid by the
te'lant, including garbage collection, sewer, common
area, water, electricity, gas and other heating, and
refrigeration costs, but not telephone service; any
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other interest, taxes, fees or charges for
land or associated facilities and assessed
or private entity other than the Developer,
the tenant.
use of the
by a public
and paid by
1. "Restricted Units" shall mean the ninety (90) Units
which are affordable Rent - restric~ed pursuant to this
Agency Regulatory Agreement.
m.
"Senior Ci ti zen
set forth in the
Households"
Agreement.
shall
have
the
meaning
as
n.
"Term" shall mean the period of fifty-five
beginning on the date of recordation of
Regulatory Agreement and ending on the
(55th) anniversary following such date.
(55 )
the
fifty
years,
Agency
f itth
o. "Very LOI" a:1d Low Income" shall mean the annual income
for very low and low income households with an Adjusted
Income as established and amended from time to time
pursuant to Section 8 of the United States Housing Act
of 1937, as amended, and as published by the State of
California Department of Housing and Community
Development.
p.
\'Units" shall mean the
Household rental dwelling
Site.
ninety (90) Senior Citizen
units to be constructed on the
ARTICLE 2
SENIOR CITIZEN HOUSEHOLD RESTRICTED UNITS
RENT AND OCCUPANCY AFFORDABILITY COVENANTS
2.1 Occupancy Requirement. During the first forty (40)
years of the Term of this Agreement not less than eighty-nine (89)
0: the ;]nits (the Restricted Units) shall be rented or occupied
by, or if vacant, available for rental and occupancy by Very Low
I:'.come Senior Citize:1 Households. Thereafter for the additional
:'ifteer. (:;'5) year Term of this Agreer:\ent, but not before the term
:;f the HUD Capital Advance Docur:\ents, the Restricted Units shall
be rented and occupied by, or if vacant, available for rental and
oc:;upancy by low income tenants as defined in Heal ch and Safety
Code Section 50093.
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2.2 Allowable Rent for Restricted Units.
a. Subject to Section 2.3 below, the Rent charged the
occupants of the Restricted Units shall not exceed thirty percent
130%) of one-twelfth of Lower Income, adjusted for household size.
b. In calculating
Units, the household size
per Unit.
the allowable Rent for
shall be assumed to be
the
one
Restricted
(1) person
c. At least one hundred eighty (180) calendar days prior t:o
increasing Rent on any Restricted Unit, the Developer shall submit
to the Agency for review and approval a written request for such
increase. Households occupying Units shall be given at least
ninety (90) days written notice prior to any increase in Rent.
Rent for a Restricted Unit may only be increased one time per
year and the Rent: levels following an increase, or upon a new
occupancy, shall not exceed the applicable Rent levels set forth
~n Section 2.2.a., above.
2.3 Increased Income of a Senior Citizen Household Occupancy
of a Restricted Unit.
a. In the event, upon recertification of an occupant
r.ousehold's income for a Restricted Unit, the Cleveloper discovers
~na~ a very Low and/or Low Income Household no longer qualifies as
a 'o'ery ~ow and/or Low Income household, then such household shall
no~ be required to vacate the Project and the Rent Chargeable to
1:~;at household shall be increased to an amount of Rent which lS
cece lesser amount of (i) thirty percent (30%) of that household's
actual :nonthly lncome; or Iii) the amount payable by the tenant
u:-:de:- S~ate or- local 1a\.;. However, \-ihen the ?esti:"lcted Unit is
acated by that household or another unrestricted Unit is vacated,
c~e Unit shall be rented to a Very Low and/or Low Income h~usehold
at the Rent level allowed in Section 2.2 for a Restricted Unit as
of the date of conunencement of such a new occupancy. Moreover, a
~nit occupied by a Very Low and/or Low Income household shall be
deer.ed, upon the termination of such Very Low and/or Low Income
household's tenancy to be continuously occupied by a Very Low
a~%r Low Income household until that Unit is reoccupied.
b. T; tr.e Project is subject to state or federal rules
;::".-2:-nir;,~ low income h::usi:;g tax credit.s, the py'::)vlsions of those
r~les regarding continued occupancy by, and Rent charged to,
households whose incomes exceed the eligible lncome limitation
shall apply in place of the provisions set forth in Section
2.3.a., above.
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2.4 Lease provisior.s.
a. The Developer shall include in leases or rental
agreements for all Restricted Units provisions which authorize
owner to immediately terminate the tenancy of any household one or
more of whose members misrepresented any fact material to the
household's qualification as a Lower Income and/or Senior Citizen
household and for all Units (except the on-site manager's unit)
any misrepreser.tation relating to the Senior Citizen Household
qualification. Each lease or rental agreement for a Restricted
Unit shall also provide that the household is subject to annual
certification in accordance with Section 4.1 below, and that, if
the household's income increases above the applicable limits for a
~ower Income household such household's Rent may be subject to
lncrease to the lesser of (i) thirty percent (30%) of that
household's actual adjusted monthly income; or (ii) the amount
payable by the Tenant under the State or local law, or the
household may be required to vacate the Unit.
b. The leases for Restricted Units shall provide that if
tr.e Project is subject to State or federal rules governing low
inc::me housing tax credits, the provisicns of those rules
regarding ccntinued occupancy by, and increases ~n Rent for
househo~ds whose lncomes exceed the eligible income limitation
shall a~ply in place of the provisions set forth in Section 2.4.a,
above.
2.5 HUD Compliance. During the period of time when the
;'UD Capital Advance Documents are in effect ,:ith respect to the
?roject, compliance by the Developer with the requirements of the
~UD Sectio~ 202 program and the HUD Capital Advance Documents
.::: ~ ~ :>~ deened compl iance by the Developer h'l t h cequirements of
:"lS AR-=-=C::'E 2, and Section 3.1, and ARTICLE 4, and in the event
~f 3 co~flict between any such provision of this Agreement and the
~ 0 Ca~ital Advance Documents, the cequirements of the HUD Capital
~Qva~=e JO=L~en~s shall control.
ARTICLE 3
OPERATION AND MAINTENANCE OF THE PROJECT
~.- ~se as Senior Citizen ?ental Housing. The Project shall
-, _perated only as rental housing for Senior Cltizen Households,
exce~t for not more than one (1) of the Units, wh i ch may be used
and cccupied by on-site resident manager Is) emplcyed by the
.:'e '2~cper and/oc the Management Agent. No part of the Project
shall be operated as transient housing.
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3.2 Compllance with the Agreement.
comply with all the terms and provisions of
The Developer
the Agreement.
shall
3.3 [RESERVED--NO TEXT]
3.4 Taxes and Assessments. The Developer shall pay all real
a~d personal property taxes, assessments and charges and all
franch:se, income, employment, withholding, sales, and other taxes
assessed against it, or payable by it, at such times and in such
manner as to prevent any penalty from accruing, or any lien or
charge from attaching to the Site; provided, however, that the
Developer shall have the right to contest in good faith, any such
taxes, assessments, or charges. In the event the Developer
exercises its right to contest any tax, assessment, or charge
against it, the Developer, on final determination of the
proceeaing or contest, shall immediately payor discharge any
decision or judgment rendered against it, together with all costs,
charges and interest.
3.5 Nondiscrimination. Except as otherwise required by the
rental requirements of the HUD Section 202 program and the HUD
Capital Advance Documents, all of the Units shall be available for
occupancy on a continuous basis to Senior Citizen Household
rrembers of the general public (who are also income eligible with
respect to the Restricted Units). The Developer shall not give
preference to any particular class or group of persons in renting
t'1e Units. There shall be no discrimination against or
segregation of any person or group of persons, on account of race,
cc~or, creed, religion, sex, sexual orientation, age, marital
status, national origin, or ancestry in the leasing, subleasing,
cransferring, use, occupancy, tenure, or enjoyment of any Unit.
':e~ther the Develcpe~ nor a~y person clai~i~~ under or through the
~2~eloper, shall establish or permit any such practice or
;::~actices of discri!!'.ination or segregation with reference to the
se':ection, location, nL:rnber, use, or occupancy, of tenants,
lessees, sublessees, subtenants, or vendees of any Unit or in
conneiCtion with- the employment of persons for the operation and
mar.agernent of any Unit. .;11 deeds, leases or contracts made or
2~tered into by owner 2S to the Units or the Site or portion
~~~~ec~, shall contain covenants prohibit~~g d~scrimination as
~0sc~ioed ~erein. T~e ~evelc98r shall incl~~e a statement in all
,-...;;:::--:.i.32~ents, not~c>=s aI~j slqns for the fl':::: ~abillty of Units
:~r re~t ~c Cl1e effect that owner is an Equal ~cJsing ~pportunity
?,-::'cvider.
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ARTICLE 4
SENIOR CITIZEN HOUSEHOLD AND INCOME
CERTIFICATION AND REPORTING
4.1 Age and Income Certification.
a. The Developer shall obtain and complete prior to initial
ocC'~,ancy and thereafter maintain on file income certifications
:rom each tenant household renting any of the Restricted Units.
The Developer shall make a good faith effort to verify that the
~r.come provided by an applicant or occupying Senior Citizen
~o~sehold in an income certification is accurate by taking one or
mere of the following steps as a part of the verification process:
(1) obtain an income tax return for the most recent tax year; (2)
conduct a credi t agency or similar search; (3) obtain an income
verification form from the applicant's current employer; (4)
obtain an i:1come verification form from the United States Social
Security Administration and/or the California Department of Social
Services if the applicant receives assistance from either of such
agenc1es; or (5) if the applicant is unemployed and has no such
tax return, obtain another form of independent verification. On
tne anniversary of the occupancy of such Restricted Unit, the
Developer shall recertify the household income of the Senior
Cit~zen Household occupying the Restricted Unit. Copies of tenant
~r.come certification shall be available to the Agency upon
re::::ues"C..
b. The Developer shall verify, prior to the occupancy of
each [nit that the Senior Citizen Household satisfies the
requirements of a sen10r c:tizen household as provided in the
Agreement. Thereafter, the Developer shall annually verify tr.at
the Senior Citizen Household retains its qualification as a Senior
Citizen Household. For purposes of this Section 4.l.b, the
'Ceveloper may conclusively rely upon the evidence of the age of
t'le occupant (s) of the Unlt as presented in a valid California
Driver's License, ot'ler form of identification issued by the State
or federal government, which includes a date of birth.
". _ 1'.:cnJal ?estricted U~,it Rental A:fordability Report to
:-\'Je~lej:- C:;mmenclng en the June 30 next following the
Certification of the Occupancy Date and on each June 30 thereafter
:Lrir:g the Term of the Agency Regulatory Agreeme:1t, the Developer
shal~ submit a report to the .Z\gency, 1n a form approved by the
':\gency, attached as (t:;.:hibit B). The an:1ual report shall include
for each Restricted Unit covered by this Agency Regulatory
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Agreement, the Rent and the income and family size of the Senior
Citizen Household occupying the Restricted Unit. The report shall
also state the date the tenancy commenced for each Restricted Unit
and such ocher information as the Agency may be required by law cO
obtain; provided, however, that the Agency shall take reasonable
steps to maintain the confidential nature of the information
contained therein relating to any Restricted Unit.
4.3 Additional Information. The Developer shall provide any
additional information reasonably requested by the Agency,
including without limitation such Project-related income and
expense accounting information. The Agency shall have the right
cO examine and make copies of all books, records or other
documents of Developer, which pertain to any Unit; provided,
however, that the Agency shall take reasonable steps to maintain
che confidential nature of the information contained therein.
4.4 Records. The Developer shall maintain complete,
accurate and current records pertaining to the Units, and shall
permit any duly authorized representative of the Agency (during
ousiness hours and upon not less than seventy-two (72) hours
notice) to inspect records, including records pertaining to income
a~d ~ousehold size of tenant households of Restricted Units;
orovided, however, that the Agency shall take reasonable steps to
~aintain the confidential nature of the information contained
therein relating to any household.
ARTICLE 5
PROPERTY MANAGEMENT
5.1 Management Responsibilities. The Developer shall be
responsible for management of the Project, including, without
limitation, the selection of tenants, certification and
recertification of household Slze, and income for the Restricted
Units and the age of the head of household of all Units,
evicticns, collection of rents and deposits, maintenance,
landscaping, routine and extraordinary repairs, replacement of
capi tal items, and security. The Agency shall have no
responsibility for the management or operation of the Site or the
Project.
5.2
managed
:c.gent" )
ab~lity
sir.1ilar
i~anagement Agem:. The Project shall at all times be
by an experienced management agent (the "Management
reasonably acceptable to the Agency, with demonstrated
to operate senior citizen residential rental facilities
to the Project in a manner that will provide decent, safe,
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and sanitary housing. tor the purposes hereof, if the Developer
directly performs the functions of the Management Agency by its
employees or by means of a service contract with an entity owned
or controlled by the Developer, such a Management Agent shall be
deemed approved by the Agency. I f the Management Agent is an
entity or person other than the Developer, its employees or an
e:1tity owned or controlled by the Developer, the Developer shall
submit for the Agency's approval the identity of any proposed
Management Agent, together with additional information relevant to
the background, experience and financial condition of any proposed
Management F.gent as reasonably requested by the Agency. If the
proposed Management Agent meets the standard for a qualified
~lanagement Agent set forth above, the Agency shall approve the
proposed Management Agent by notifying the Developer in writing.
Unless the proposed Management Agent is disapproved by the Agency
,:ichin thirty (30) days, which disapproval shall state with
reasonable specificity the basis for disapproval, it shall be
deemed approved. The Developer is hereby approved by the Agency
as the Management F.gent for the Project. Any Management Agent
approved by HUD during the term of the HOD Capital Advance
Documents shall be deemed approved by the Agency.
5.3. Maintenance of the Si::e and the Project.
a. The Developer shall maintain the Site and the Project in
good repair ard a neat, clean ard orderly condition, ordinary wear
and tear excepted. In the event that, at ary time during the term
of this Agency Regulatory Agreement, there is an occurrence of an
adverse condition on any area of the Site in contravention of the
general maintenance standard described above (a "Maintenance
Deficiency"), then the Age:1cy shall notify the Developer in
writing of the Maintenance Deficiency and give the Developer sixty
(60) days from receipt of such notice to cure the Maintenance
Deficiency as identified In the notice. In the event the
Developer fails to cure or co~mence to cure the Maintenance
Ceficiency within the time allowed, the Agency may conduct a
public hearing following transmittal of written notice thereof to
::he Developer ten (10) days prior to the scheduled date of such
public hearing in order to verity whether a Mai:1tenance Deficiency
exis::s and '<lhether the Developer has failed to comply with the
provision of this Section 5.3a. If, upon the conclusion of a
public hearing, the Agency makes a finding that a Maintenance
Deficiency exists and that there appears to be non-compliance with
::he general mai:1tenance standard, as described above, thereafter
the Agency shall have the right to enter the Site and perform all
acts necessary to cure the Maintenance Deficiency, or take other
action at law or equity the Agency may then have to accomplish the
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aLatement of the Maintenance Deficiency. Any sum expended by the
Agency for the abatement of a Maintenance Deficiency as authorized
by this Section 5.3a shall become a lien on the Site. If the
amount of the lien is not paid wi thin thirty (30) days after
written demand for payment by the City has been presented to the
Developer, the Agency shall have the right to enforce the lien in
the manner as provides in Section 5.3c.
b. Graffiti which is visible from any public right-of-way
,>,hich is adjacent or contiguous to the Site shall be removed by
the Developer from any exterior surface of a structure or
im9r-ovement on the Site by either painting over the evidence of
such vandalism with a paint which has been color-matched to the
sur-face on which the paint is applied, or graffiti may be removed
wlc:h solvents, detergents or water as appropriate. In the event
that graffiti is place on the Site and such graffiti is visible
from an adjacent or contiguous public right-of-way and thereafter
such graffiti lS not removed within seventy-two (72) hours
fo~lo,:ing the time of its a9plication; then, in such event and
without: notice to the Developer, the Agency shall have the right
to enter the pr0gerty and remove the graffiti. Notwithstanding
any provision of Section 5.3 to the contrary, any sum expended by
~'1e ,b,ge:1cy for the removal of graffiti from the Site as authorized
OJ' c:':is Section 5.b, shall become a lien on the Site. If the
"C",OU~jt 0: the lien is not paid within thirty (30) days after
,':ritten deffiand for- payment by the .".gency to the Developer, the
Age:1cj shall have the right to enforce its lien in the manner as
provided in Section 5.3c.
c. The parties hereto further mutually understand and agree
that the rights conferred upon the Agency under this Section 5.3
eX9ressly include the power to establish and enforce a lien or
o~heY eucu~brance against the Site, or any po~tion thereof, in the
manner provided under Civil Code Secc:ions 2924, 2924b and 2924c in
the amount reasonably necessary to restore the Site to the
maintenance standard required under Section 5.3a, or Section 5.3b,
including reasonable attorneys fees and costs of the Agency
associated with the abatement of the Maintenance Deficiency or
removal of graffiti and the collection of the ccsts of the Agency
in connection with such action. The provisions of this Section
5.3 shall be a covenant running with the land for the Term of the
Agenoy Regulatory Agreement and shall be enforceable by the
A:;ency, and its successors and assigns. Nothing in the foregoing
provisions of this Section 5.3 shall be deemed to preclude the
Ceveloper from making any alternations, additions, or other
changes to any structure or improvement or landscaping on the
Site, provided that such changes comply with applicable law. No
11
1'_-\!,c"d~sA...cndi Al1a,hmenls\E~hib'IS"1005\O~.12-1" AHEPA Re~uIJIOr~ A~reement (Exhibll E) doc
l~en as may arise under this Section 5.3 shall interfere with or
be superior to the security interest of any mortgage secured by
-:he Site.
d. Notwithstanding the foregoing provisions of this Section
5.3, during the term of the HUD Capital Advance Documents, the
Agency shall not enter the Si te, except in an emergency, without
the pnor written approval of HUD, and any lien of the Agency
au-:hor i zed under this Section 5.3 shall also be subj ect to the
pr~or written approval of HUD.
5.4 Insurance Coverage.
in full force and effect during
Agreement insurance coverage as
The Developer shall cause to have
the term of this Agency Regulatory
follows:
(i; If any building or improvements erected by the Developer
on the Site shall be damaged or destroyed by an
insurable cause, the Developer shall, at its own cost
and expense, diligently repair or restore the Site and
the Project consistent with the original plans and
s[)ecifications for the Project. Such work or repair
shall be commenced within one hundred twenty (120) days
after the damage or loss occurs and shall be completed
within one year thereafter. All insurance proceeds
collected for such damage or destruction shall be
applied to the cost of such repairs or restoration and,
if such insurance proceeds shall be insufficient for
such purpose, the Developer shall make up the
deficiency;
Iii) a policy of comprehensive general liability insurance
written on a per occurrence basis in an amount not less
than either (i) a combined single limi t of ONE MILLION
DOLLARS ($1,000,000.00) or (ii) bodily injury limits of
F:VE HUNDRED THOUS.'\ND DOLLARS ($500,000.00) per person,
ONE MILLION DOLLARS ($1,000,000.00) per currency, ONE
M!LLION DOLL.Z\RS ($1,000,000.00) products and completed
operations and property damage limits of FIVE HUNDRED
THOUSAND DOLLARS ($500,000.001 per occurrence and FIVE
HUNDRED THOUSAND DOLLARS ($500,000.00) in the aggregate.
(iii) a policy of workers' compensation insurance in such
amounc as will fully comply with the laws of the State
of California and which shall indemnify, insure and
provide legal defense for both the Developer, Agency,
and the City against any loss, claim or damage arising
frem any injuries or occupational diseases occurring to
12
P . Agendal..\genda A\l"hmenl~E\hlb'IS~OO~'05.1~_19 A]iEPA Regulator\ Agreement (E.h,btt E) doc
any worker employed by or any persons retained by the
Developer in the course of carrying out the activities
in this Agency Regulatory Agreement.
(ivl a policy of comprehensive automobile liability insurance
written on a per occurrence basis in an amount not less
than either (i) bodily inj ury liability limits of TWO
HuNDRED FIFTY THOUSAND DOLLARS (S250,000.00) per person
and FIVE HUNDRED THOUSAND DOLLARS (S500,000.001 per
occurrence and property damage liability limits of ONE
HUNDRED THOUSAND DOLLARS (S100,000.00)' per occurrence
and ONE HUNDRED THOUSAND DOLLARS (S100, 000.00) in the
aggregate or (iil combined single limit liability of
FIVE HUNDRED THOUSAND DOLLARS (S500,000.00). Said
policy shall include coverage for owned, non-owned,
leased and hired vehicles.
All of the above policies of insurance shall be primary
~nsurance and shall name the City and the Agency, and their
e:ficers, employees, and agents as additional insureds. The
~nsurer shall waive all rights of subrogation and contribution it
may have against t'1e City and the Agency and their officers,
employees and agents and their respective insurers. All of said
pollcies of insurance shall provide that said insurance may not be
amended or canceled without providing thirty (30) days prior
,>,ri:ten notice by registered mail to Agency. In the event any of
saio policies of lnsurance are canceled, the Developer shall,
pr~or to the cancellation date, submit new evidence of insurance
cor.:ormance with this Section to the Interim Executive
S~Yecto:c. No operation of the Project s'1all commence until the
Developer has provided Agency with certificates of lnsurance or
approprlate insurance binders evidencing the above insurance
coverages, and said certificates of insurance or binders are
approved by Agency.
T'1e policies of ir.surance required by this Agreement shall be
sa~isfactory only if issued by companies qualified to do business
In California, rated at least "A(vii)" or better in the most
recent edition of Bests Insurance Rating Guide or a:1 equivalent
rati:1g in The Key Rating Guide or in the Federal Register unless
sue'1 requirements are mcdified or waived by the Executive Director
of the Agency due to unique circumstances.
Co;;,.pliance by the Developer with the lnsurance requirements
of HUD unde:c the HUD Capital Advance Documents shall be deemed to
rr.eet the foregoing requirements during the period that the HUD
Capi tal Advance Documents are in effect so long as the Agency,
13
P ,A~endas A~en::l~ _.l.,tlachments'Edllbl'.S',201l~05-1:-19 AHEPA Regulato,", A~reemefll (bhib.t E) doc
Cicy a:1d
insureds
:nsurance
their
on all
issued
officers, employees, and agents as additiGna~
said policles as evidenced by certificates of
to the City and the Agency.
The Developer agrees that the provisions of this Section
shall not be construed as limiting in any way the extent to which
the Developer may be held responsible for the payment of damages
::0 any persons or property resulting from the Developer's
ac::ivities or the activities of any person or persons for which
the Developer is otherwise responsible.
ARTICLE 6
MISCELLANEOUS AND PRIORITY OF HUD
CAPITAL ADVANCE DOCUMENTS
6.1 Term. The provisions of this Agency Regulatory
.'\greement shall apply to the Site for the entire Term. This
Agency Regulatory Agreement shall bind any successor, heir or
assign of the Developer, whether a change in interest occurs
volun::arily or involuntarily, by operation of law or otherwise,
"i Lr. or without the approval of the Agency, except as expressly
released by the Agency.
6.2 Priority of HUD Capital Advance Documents. This Agency
"'egulatory Agreement shall be subject to and subordinate to the
terms a:1d provisions of the HUD Capital Advance Documents and any
c::her documen::s entered into by and between the Developer and the
Secre::ary of Housing a:1d Urban Development in connection with the
:sprovement or operation of the Project. Notwi::hstanding anything
contained herein to the contrary, i:1 the eve:1t the Secretary of
HU~ (Secretary) should take title to the Site through foreclosure,
ceed in lieu of foreclosure, or othenoJise as set forth in the HUD
Capi tal Advance Documen::s, all covenants, conditions and
restrictions set for::h this Agency Regulatcry Agreement shall
cease and terminate and be of no further force or effect.
iJGtwi thstanding anything ir. this Agency Regula torT- Agreement to
::he cor.trary, in the event any provision in this Agency Regulatory
.i\.greemer.:: tends to contradict. modify, or in any way change the
terms of the HUD Capital Advance Documents, the term of the HUD
Capital Advance Documents shall prevail and govern; or if any
~r_~:si~:1 of this Agency Regulacory Agreement in any way tends to
limi:: the Secrecary in ics administracion of the National Housing
.o.c:: of 1937, as amended, or the Housing Act of 1959, as amended,
cr the regulations pursuant thereto, this Agency Regulatory
Agreement shall be deemed amended so as to comply with such acts,
regulatior.s and HUD Capital Advance Documents.
14
I' ;~e~d.,' .-\~tnda ->'tlacnlnenl\ .E~h,bt:; :Uv~.O,.I:.I'1 .~IJ::PA R.~ui.lU" A~'ttm.m (Edub,! E) doc
6.3 [RESERVED--NO TEXT]
6.4 Non-Liability of Officials, Employees
.I'Igency shall not be personally liable to the
obligation created under the terms of this
Agreement except in the case of actual fraud or
by such person.
and Agents. The
Developer for any
Agency Regulatory
willful misconduct
6.5 Covenants to Run With the Land. Subject to the
pro'Jisions of Sect.ion 6.2, the Agency and the Developer hereby
declare their express intent that the covenants and restrictions
set forth in this Agency Regulatory Agreement are affordable
redevelopment housing covenants and that each and every provision
of this Agency Regulatory Agreement shall run with t.he land, and
shalL bind all successors in title to the Site and/or the Project;
pr:Jvided, however, that on the expiration of the Term of this
.".gency Regulat.ory P.greement said covenants and restriotions shall
exp~re.
6.6 Enforcement by the Agency. If the Developer fails to
perform any obligation under this Agency Regulatory Agreement, and
:ails to cure the default within thirty (30) days after the Agency
has notified tr.e Developer in vlriting of the default or, if the
default cannct be cured within thirty (30) days, fails to commence
t:J CGre within thirty (30) days and thereafter diligently pursue
suc'l cure, the P.gency shall have the right to enforce this Agency
Regulatory P.greement by any or all of the following actions, or
a~y other remedy provided by law:
a. Action to Compel Performance or for Damages. The Agency
may bring an actio"! at law or in eqc:ity to compel the
performance of the obligations of the Developer under
this Age~c! R~gulator! Agreement, and/cr for damages.
b. Enforce Liens. The .I'1gency may enforce and execute upon
the lien rights of the Agency as conferred under Section
5.3 of this Agency Regulatory Agreement; provided that
during the term of t.he HUD Capital ."Idvance Documents,
HUD has cc~se~ted iG w~iting to any such lien.
6. -, At tor"!eys' Fees a~::l Costs. In any action brought to
enforce thlS Agency Regulatory Agreement, the prevailing party
,l=- te entitled to a~l costs and expenses of suit, including
,c: c::cr"!ejs' fees. Thi s sect ion shall be interpreted in accordance
"!lth California Civil Code Section 1717 and judicial decisions
lnterpreting that statute. For the purposes of thlS Section 6.7,
5a~ary, ~ringe benefits and overhead expenses of lawyers
1. ~
':"':C"do' >'LenJA .-\tl~~hmenl>E,h,t>.\ji'lv"<;.C'~.ll.I'-l A/HoP,>, Re~\JI.tp" .l,greemcnl (E.h,bH I') doc
empcoyed in the Office of City Attorney of the City of San
Eernardino shall be deemed to be attorney's fees.
6.8 Recording and Filing. The Agency and the Developer
shall cause this Agency Regulatory Agreement, and all amendments
and supplements to it, to be recorded in the Official Records of
the County of San Bernardino, California.
6.9 Governing Law. This Agency Regulatory Agreement shall
be governed by the laws of the State of California, except those
provisions preempted by federal law.
6.10 Amendments. This Agency Regulatory Agreement may be
amended only by a written instrument executed by all the parties
here~o or their successors in title, and duly recorded in the real
property records of the County of San Bernardino, California;
provided, however, that during the period of time when the
provisions of the HUD Capital Advance Documents are in effect this
."'gency Regulatory Agreement may not be amended without the prior
written approval of the Secretary or HUD.
6.11 Notice. All notices given or certificates delivered
under t~is Agency Regulatory Agreement shall be deemed received on
t!:e deli-Jery or refusal date shown on the delivery receipt, if:
i) personally delivered by a cormnercial service which furnishes
signed receipts of delivery or Iii) rr,ailed by certified mail,
return receipt requested, postage prepaid, addressed as shown on
the signature page. Any of the parties may, by notice given
hereunder, designate any further or differe~t addresses to which
subsequent notices, certificates or communications shall be sent.
6.12 Severabilit,". If any provision 0:
Fegu~atory Agr-eemen~ shall ::e irn.alid, illegal or
~he ~aliditYf legality and e~forceability of
por~ions of this Agency Regulatory Agreement shall
be affected or impaired thereby.
this Agency
unenforceable,
the remaining
not in any way
6.13 [RESERVED--NO TSXT
6.14 Relationship of ?arties. T!-..e relationship between the
Age~cy and the Developer d~ring t~e term of this Ager.cy Regulatory
~~~Ge~e~t s~all not be co~s:r~ed as a ~ci~t ~enturef equity
~~-.~~~, Cr partnership. :~e Agency does ~ot ~nder:aKe nor assume
a~,y responsibility or ciu~y ~o the Developer or anv third party
with respect to the ownershlp of the Site or the operation of the
?roject or t~e actions of the Developer. The Developer shall have
no authority to act as an agent of the Agency or to bind the
~gency to any obligation.
-
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i' -I, ;'.:", -\~,'''JJ .l,ila,hmenl' .1--~~'bll~ 2')(1) _.0<; i:.! 9 .....HEP A Re~'JI..lO" .l,elee",enl IF ,h,h,t E I rl'lC
6.15 Waiver. Any waiver by the F.gency of any obligation in
this Agency Regulatory Agreement must be in writing. No waiver
will be implied from any delay or failure by the Agency to take
action on any breach or default of the Developer or to pursue any
remedy allowed under this Agency Regulatory Agreement or
applicable law. Any extension of time granted to the Developer to
perform any obligation under this Agency Regulatory Agreement
shall not operate as a waiver or release from any of its
obligations under this Agency Regulatory Agreement. Consent by
t'1e Agency to any act or omission by the Developer shall not be
construed to be a consent to any other or subsequent act or
omission or to waive the requirement for the Agency's written
co~sent to futu~e waivers.
6.16 OtherF.greements. The Developer represents that it has
not entered into any agreements that would restrict or compromise
its ability to comply with the terms of this Agency Regulatory
.;greement. Except for the HUD Capital Advance Documents and any
ot'1er documents required by HUD under the HUD Section 202 program,
t'1e Developer shall not enter into any agreements that are
inco,.sistent with the terms of this Agency Regulatory Agreement
wi~hout the express approval by the Agency in writing.
~ 7
P __'1genda, -\genda AI\achm"'nt~'bhlbas',_2()(15_f)5_1:.I" AHEPA R...gula\m.'\~fu"'e"l (hlub" E) do~
IN WITNESS WHEREOF, the Agency and the Developer have for
themselves and their successors and assigns executed this Agency
Regulatory Agreement by duly authorized representatives in
counterpart original copies, all as of the date first written
above.
Date:
APPROVED AS TO FORM:
Agency Spec~al Counsel
0at.e:
[A~L OFFICER/PRINCIPAL
SIGNATURES TO BE NOTARIZED]
AGENCY
Redevelopment Agency
of the City of San Bernardino,
a public body corporate and
politic
By:
Maggie Pacheco
Interim Executive Director
DEVELOPER
AHEPA National Housing Corporation
AHEPA Local Arrowhead 302 Chapter, a
California non-pr~fit corporation
By:
By:
f' ;,"nda'.A~end<l Allilchmen1\.bh,b,(s.:00~ 0'.]2.]<) AHEPA Regul,wr\ !lljl1eemenl (bhlb'l E) doc
18
EXHIBIT "Au
LEGAL DESCRIPTION OF THE SITE
PARCEL 1 OF PARCEL MAP 6660, AS PER MAP RECORDED IN BOOK 67, PAGES
16 AND 17 OF PARCEL MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF
SAID COUNTY.
19
PAg~nda'\."'genda AllJchmtnlsEKhlbll5'2005\05.1:.19 AHEPA RegulatOT\ ....grcemem (hh,b,t E) doc
EXHIBIT "B"
FOcffi of Certifi~ation of Tenant Eligibility
20
P v.."endd5\A~enda AltiChmeNs'.E~h,b.u';OO~,O~.]=-19 AHEPA RCKulato') A!!.eemenl (E~h'bi( E) doc
FORM OF CERTIFICATION OF TENANT ELIGIBILITY
Rental Unit
Street
Address
City
Unit No
Zip Code
I/We, the undersigned, being first duly sworn, state that Vwe have read and answered fully and
truthfully each of the following questions for all persons who are to occupy the unit in the above
apartment development for which application is made, all of whom are listed below:
Name of Members Relationship to Social Security
in the Household Head of Age Number Place of Employment
Household
2
3.
4.
5.
Monthly Rent Amount:
Date of Occupancy of Rental Unit by Tenant:
Date of Lease Signed for Rental Unit by Tenant:
Certification Date (Earlier of Date of Occupancy or Date Lease signed):
6. Anticipated Annual Income, The anticipated total annual income from all sources of each
person listed in I for the twelve month period beginning on the Certification Date listed above,
including income described in (a) below, but excluding all income described in (b) below, is
$
(a) The amount set forth above includes all of the following income (unless such income is
described in (b) below):
(i) all wages and salaries, overtime pay, commissions, fees, tips and bonuses before
payroll deductions; (ii) net income from the operation of a business or profession or
from the rental of real or personal property (without deducting expenditures for
business expansion or amortization of capital indebtedness or any allowance for
depreciation of capital assets); (iii) Interest and dividends (including income from
assets as set forth in item 7(b) below); (iv) full amount of periodic payments received
from Social security, annuities, insurance policies, retirement funds, pensions, disability
or death benefits and other similar types of periodic receipts; (v) payments in lieu of
earnings, such as uncmployment and disability compensation, worker's compensation
and severance pay; (vi) the maximum amount of public assistance available to the
above persons; (vii) periodic and determinable allowances, such as alimony and child
support payments and regular contributions and gifts received from persons not residing
in the dwelling; (viii) all regular pay, special pay and allowances of a member of the
Armed Forces (whether or not living in the dwelling) who is the head of the household
or spouse; and (ix) any earned income tax credit to the extent it exceeds income tax
liability.
(b) The following income is excluded from the amount set forth above:
(i) casual, sporadic or irregular gifts; (ii) amounts that are specifically for or in
reimbursement of medical expenses; (iii) lump sum additions to family assets, such as
inheritances, insurance payment (including payments under health and accident
insurance and worker's compensation), capital gains and settlement for personal or
property losses; (iv) amounts of educational scholarships paid directly to student or
educational institution, and amounts paid by the government to a veteran for use in
meeting the costs of tuition, fees, books and equipment, but in either case only to the
extent used for such purposes; (v) hazardous duty pay to a member of the household in
the armed forces who is away from home and exposed to hostile fire; (vi) relocation
payments under Title II of the Uniform Relocation Assistance and Real Property
Acquisition Policies Act of 1970; (vii) income from employment of children (including
foster children) under the age of 18 years; (viii) foster child care payments; (ix) the
value of coupon allotments under the Food Stamp Act of 1977; (xi) payments to
volunteers under the Domestic Volunteer Service Act of 1973; (xii) payments received
under the Alaska Native Claims Settlement Act; (xiii) income derived from certain
submarginal land of the United States that is held in trust for certain Indian tribes; (xiv)
payments on allowances made under the Department of Health and Human Services'
Low-Income Home Energy Assistance Program; and (xv) payments received from the
Job Partnership Training Act.
7. Net Family Assets. If any of the persons described in item I above (or any person whose
income or contributions were included in item 6) has any savings, stocks, bonds, equity in real
property or other form of capital investment (excluding interests in Indian trust lands), provide:
(a)
the total value of all such assets owned by all such persons: S
, and
(b) the amount of income expected to be derived from such assets in the 12-month period
commencing this date: S
8. Students
(a) Will all of the persons listed in item 1 above be or have they been full-time students
during five calendar months of this calendar year at an educational institution (other
than a correspondence school) with regular faculty and students?
Yes
No
(b) (Complete only if the answer to Question 8(a) is "Yes"). Is any such person (other than
nonresident aliens) married and eligible to file a joint federal income tax return?
Yes
No
1
FOR COMPLETION BY PROJECT OWNER ONLY:
A. Calculation of eligible income:
(I)
Enter amount entered for enllre household m 6 above:
$
(2) If the amount entered in 7(a) above is greater than $5,000, enter
(i.) the product of the amount entered in 7(a) above multiplied
by the current passbook savings rate as determined by HUD: $
(Ii.) the amount entered in 7(b) above: $
(iii.) enter the greater of line (i) or line (Ii): $
(3)
TOTAL ELIGIBLE INCOME (Line A(I) plus line A(2)(iii)):
$
B. Enter number of family members listed in item 1 above:
C The amount entered in A(3) (Total Eligible Income) is:
s
Less than $ of median income for the area in which the
Development is located, which is the maximum income at
which a household may be determined to be a Qualifying
Tenant as that term is defined in the Regulatory
Agreement and Declaration of Restrictive Covenants (the
"Regulatory Agreement")("Qualifymg Tenant").
More than the above-mentioned amount.
D. Number of units assigned:
E. Monthly rent: $
F. This unit (was/was not) last occupied for a period of 31 consecutive days by a person or persons whose
adjusted mcome, as certified in the above manner, was equal to or less than the amount at which a person
would have qualified as a Qualifying Tenant under the terms of the Regulatory Agreement.
G. Applicant:
Qualifies as a Qualifying Tenant.
Does not qualify as a Qualifying Tenant.
3
The above information is full, true and complete to the best of my knowledge. I have no objections to
inquiries being made for the purpose of verifying the statements made herein.
I acknowledge that all of the above information is relevant to the status under federal income tax law
of the interest on bonds issued to finance construction of the Project for which application is being
made, I consent to the disclosure of such information to the issuer of such bonds, the owners of such
bonds, any trustee or agent acting on their behalf and any authorized agent of the Treasury Department
or Internal Revenue Service,
Signature:
Date:
(Signature Must be Notarized)
STATE OF CALIFORNIA
COUNTY OF SAN BERNARDINO
On before me, Notary
Public, personally appeared , personally known to
me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed
to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized
capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of
which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
Signature
(Seal)
4
EXHBIIT "F"
PROMISSORY NOTE
..R49-61118.7776 1
P \icndA,Agcnaa Alt;KlllnrnliAgmu.Amcnd 2uu5,o5-::-1" AHEPA-Arro",1Iead.30: Chaplet tlOMEGranl Agrecmc:nl doc
PURCHASE PRICE PROMISSORY NOTE
SECURED BY RECORDED DEED OF TRUST
WITH UCC FILING
Borrower:
AHEP A National Housing Corporation-
AHEPA Local Arrowhead 302 Chapter
1035 South Inland Center Drive
San Bernardino, California 92408
Lender:
Redevelopment Agency of the City of
San Bernardino
Attention: Executive Director
20 I North "E" Street. Suite 30 I
San Bernardino, California 92401
FAX: (909) 888-94 I 3
Principal Amount:
$840,000
Date of Purchase Price Promissory Note:
December _, 2005
Interest Rate: 0%
[3 % Fixed on Any Amount Not Paid at Maturity]
[Date of Disbursement of Agency Loan]
Maturity Date of Promissory Note:
One (I) year from the Date of Disbursement of Agency Loan, which Date of Disbursement of
Agency Loan shall be the date of deposit of the Principal Amount of $840,000 ("'Agency Loan'")
by the Agency into the escrow to be established by the Developer for the purchase of the "Site"
as such term is defined in the 2005 HOME Funds Loan and Grant Agreement (hereafter
"Agreement"), which deposit by the Agency shall be made not more than three (3) business days
prior to the anticipated close of escrow for the purchase of the Site by the Developer.
PROMISE TO PAY. The Undersigned AHEPA NATIONAL HOUSING CORPORATION-
AHErA LOCAL ARROWHEAD 302 CHAPTER, a California nonprofit corporation (the
"Borrower"). promise to pay to REDEVELOPlvlENT AGENCY OF THE CITY OF SAN
BERNARDINO. a public agency (the "Lender"), or order. in lawful money of the United States
of America. the principal amount of Eight Hundred Forty Thousand Dollars ($840,000.00), or so
much as may be outstanding, together with interest on the unpaid outstanding principal balance,
pursuant to this Purchase Price Promissory Note Secured by Recorded Deed of Trust and UCC
Filing (this "Purchase Price Promissory Note") until repayment in whole of the outstanding
principal balance and all accrued and unpaid interest hereunder.
I:\'DEBTED:"iESS. This Purchase Price Promissory i'\ote e\idences the indebtedness of the
BOlTower to the Lender. and shall supercede. void and cancel any and all prior agreements made
between the Borrower and the Lender with respect to the payment of the principal amount set
forth in this Purchase Price Promissory Note.
""Jo'D';i~-l1
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PAYMENT. In the event that the Agency Loan is paid in whole within said one-year period of
time, the Agency Loan shall not bear interest. Interest shall be calculated on a daily basis on a
365/366 actual calendar days basis from the original date of the Agency Loan until paid
thereafter in whole or in part as to any partial principal payment, calculated on the unpaid
principal balance of the Agency Loan for any principal amounts thereof that are not paid on or
before the maturity date hereof with interest to thereupon be calculated on such unpaid amount
from the date of the Agency Loan. The Borrower shall make all payments of interest and
principal to the Lender at the address of the Lender: 20 I North HE" Street, Suite 30 I, San
Bernardino, CA 9240 I, or at such other place as the Lender may designate in writing. Unless
otherwise agreed to by the Lender in writing or required by applicable law, payments will be
applied first to any unpaid collection costs and any late charges, then to any interest due, and
then any remaining amount to principal.
INTEREST RATE. Interest shall accrue on the outstanding principal balance of this Purchase
Price Promissory Note commencing on the Date of Disbursement of Agency Loan at the rate of
three percent (3%) per annum, calculated on the unpaid principal balance of the Agency Loan for
any principal amounts thereof that are not paid on or before the maturity date hereof with interest
to thereupon be calculated on such unpaid amount from the date of the Agency Loan.
LATE CHARGE. If an installment payment is ten (10) days or more late, the Borrower shall
also be charged $250.00 as a late charge for each such late payment of an installment.
DEFAUL T. The Borrower shall be in default under the terms of this Purchase Price Promissory
1\:ote if any of the following occurs:
(a)
(b)
(c)
(d)
J,'\:3.Y966-69~-4, I
The Borrower fails to make any payment when due.
The Borrower defaults on any promise the Borrower has made to the
Lender or if the Borrower otherwise fails to comply with or to perform
when due any other term, obligation, covenant or condition contained in
this Purchase Price Promissory Note or any agreement related to this
Purchase Price Promissory Note.
The Borrower defaults under any loan, extension of credit, security
agreement, purchase or sales agreement, or any other agreement, in favor
of any other creditor or person that may materially.affect any of the
Borrower's property or the Borrower's ability to repay this Purchase Price
Promissory Note or the ability of the Borrower to perfornl its other
obligations under this Promissory Note.
Any representation or statement made or furnished to the Lender by the
Borrower or on the Borrower's behalf is false or misleading in any
material respect either now or at the time made or furnished.
!' A~enja, ..\~ellj4 Anachmel\l\ .l~..,bL!1 ":('~5 (;5..2. : ~'\I!l r A P'''''''<lorl' 'Ole: (E.hlh,1 F) doc
o
(e) Either of the parties who have executed this Purchase Price Promissory
Note on behalf of the Borrower dies or becomes insolvent, or if a receiver
is appointed for any part of the Borrower's property, or if the Borrower
makes an assignment for the benefit of creditors, or any proceeding is
commenced either by the Borrower or against the Borrower under any
bankruptcy or insolvency laws.
(f) Any creditor tries to take any of the Borrower's property on or in which
the Lender has a lien or security interest.
(g) A material adverse change occurs in the Borrower's financial condition, or
the Lender believes the prospect of payment or performance of the
indebtedness evidenced by this Purchase Price Promissory Note is
impaired.
If any default is curable and if the Borrower has not been given a notice of a breach of the same
provision of this Purchase Price Promissory Note within the preceding twelve (12) months, it
may be cured (and in such event no default will be deemed to have occurred) if the Borrower,
after receiving written notice from the Lender demanding cure of such default:
(i) cures the default within fifteen (15) days; or
(ii) if the cure requires more than fifteen (15) days, immediately initiates steps
which the Lender deems in its sole discretion to be sufficient to cure the
default, and thereafter Borrower continues and cures such default within
the time expressly authorized in writing by Lender.
RIGHTS/REMEDIES OF THE LENDER/HOLDER. Upon default, the Lender or its assign
(a "Holder"), as the case may then be, may exercise any of the Lender's rights. including without
limitation. the declaration by the Lender/Holder that the entire unpaid principal balance on this
Purchase Price Promissory Note and all accrued unpaid interest is immediately due, without
notice, and then the Borrower shall pay that amount. The Lender/Holder may hire or pay
someone else to help collect this Purchase Price Promissory Note if the Borrower does not pay.
The Borrower also will pay the Lender/Holder that amount for hiring or payment to enforce such
collection, including without limitation. subject to any limits under applicable law, any and all of
the attorneys' fees and the legal exp~ses incurred by the Lender/Holder whether or not there is a
lawsuit, including efforts to modify or vacate any automatic stay or injunction, appeals, and any
anticipated post-judgment collection services incurred by the Lender/Holder, in addition to such
other relief as may be granted in an action or proceeding, whether at trial or on appeal, to be paid
by Borrower to Lender/Holder for all out-of-pocket costs and expenses incurred as a result
thereof. The Borrower also shall pay any and all court costs, in addition to all other sums due the
Lender/Holder provided by law. This Purchase Price Promissory Note has been delivered to the
Lender/Holder and accepted by the Lender/Holder in the State of California. If there is a lawsuit
arising under this Purchase Price Promissory Note, the Superior Court of the State of California
in and for the County of San Bernardino shall have jurisdiction of such lawsuit. This Purchase
Price Promissory Note shall be governed by and construed in accordance with the laws of the
State of California.
-l~23-9966-69..t-l ]
3
P .Agenn"Aj;enda Allachm.nt~-Exh,bllS'.100S'05.12_19 All[PA Pr()mISSO'~ ~ol.l (E~hlbll F) doc
COLLA TERAL. The Borrower acknowledges this Purchase Price Promissory Note is secured
bv a Deed of Trust of even date herewith. The Deed of Trust affects Assessor's Parcel Numbers
. (collectively, the "Property"). The Deed of Trust contains the
following due on sale provision:
"The Trustee (or the Beneficiary) may, at its option, declare
immediately due and payable all sums secured by this Deed of
Trust upon the sale, transfer or further encumbrance without the
prior written consent of the Trustee (or the Beneficiary), of all or
any part of the Real Property, or any interest in the Real Property.
A "sale, transfer or encumbrance" means the conveyance of the
Real Property or any right, title or interest therein; whether legal,
beneficial, or equitable; whether voluntary or involuntary; whether
by outright sale, deed, the creation of a new installment sale
contract. land contract, contract for deed, leasehold interest in the
Property with a term greater than one (I) year, lease-option
contract, or by sale, assignment, or transfer of any beneficial
interest in or to any land trust holding title to the Property, or by
any other method of conveyance of property interest."
GENERAL PROVISIONS. The Lender/Holder may delay or forego enforcing any of its rights
or remedies under this Purchase Price Promissory Note without losing them. The Borrower and
any other person who signs, guarantees or endorses this Purchase Price Promissory Note, to the
extent allowed by law, waive any applicable statute of limitations, presentment, demand for
payment, offsets. claims, protest and notice of dishonor. Upon any change in the terms of this
Purchase Price Promissory Note, and unless otherwise expressly stated in writing. no party who
signs this Purchase Price Promissory Note, whether as maker, guarantor, accommodation maker
or endorser, shall be released from liability. All such parties agree that the Lender/Holder may
renew or extend (repeatedly and for any length of time) this Purchase Price Promissory Note, or
release any party, or guarantor or collateral, and take any other action deemed necessary by the
Lender/Holder in its sole discretion without the consent of or notice to anyone. All such parties
also agree that the Lender/Holder may modify this Purchase Price Promissory Note without the
consent of or notice to anyone other than the party with whom the modification is made.
PRIOR TO SIGNING THIS PURCHASE PRICE PROMISSORY NOTE, THE BORROWER
HAS READ AND UNDERSTANDS ALL OF ITS PROVISIONS. THE BORROWER
AGREES TO THE TERMS OF THIS PURCHASE PRICE PROMISSORY NOTE AND
ACKNOWLEDGES RECEIPT OF A COPY HEREOF.
BORROWER
AHEPA NATIONAL HOUSING CORPORATION-
AHEPA LCOAL ARROWHEAD 302 CHAPTER.
a California nonprofit corporation
Date:
By:
Title:
482J.9966-69441
4
P 'A!,:endal'.A~endil Ana~hmenll',E\hibiIS'':OO~'05.1;:_19 AHEPA Prom,ssory Nole2 (Edl,bn F) doc
EXHIBIT "G"
DEED OF TRUST
4849-6618-7776.1
P\ApDda$\Aaenda AlUChlTlClU'^JrlYas-Ammd :!OO5\O5.1 :!.19 AHEPA.AITO....head 302 Chapler HOME <Am A~ doc
RECORDING REQUESTED BY AND
\VHEN RECORDED MAIL TO:
Redevelopment Agency
of the City of San Bernardino
20 I North "E" Street, Suite 30 I
San Bernardino. CA 92401
.-\ttn.: Interim Executive Director
(Space Above Line for Recorder's Use Only)
Recording Fce Exempt Pursuant to Government Code Section 6103
DEED OF TRUST WITH UCC FILING
(Redevelopment Agency of the City of San Bernardino)
THIS DEED OF TRUST WITH UCC FILING ("Deed of Trust"), dated December _,
2005, is made by AHEPA NATIONAL HOUSING CORPORATION - AHEPA LOCAL
ARROWHEAD 302 CHAPTER, a California nonprofit corporation, whose address is 1035
South Inland Center Drive, San Bernardino, California 92408 (the "Trustor"), in favor of
Title Insurance Company (the "Trustee"), whose address is
. CA , for the benefit of the REDEVELOPMENT
AGENCY OF THE CITY OF SAN BERNARDINO, a public body, corporate and politic whose
address is 201 North "E" Street, Suite 301, San Bernardino, CA 92401 ("Beneficiary"). This
Deed of Trust is executed to secure the payment of a note of even date herewith in the principal
amount of Eight Hundred Forty Thousand Dollars ($840,000), and all accrued interest thereon.
1. General.
1.1. Real Prooerh'. The "Real Property" includes:
(a) the land described in Exhibit "A" attached to this Deed of Trust
and incorporated in this Deed of Trust by this reference (the "Land''); and
(b) all buildings, structures and other improvements now or in the
future located or to be constructed on the Land (collectively, the "Improvements"); and
(c) all tenements, hereditaments, appurtenances, privileges and other
rights and interests now or in the future benefiting or otherwise relating to the Land or the
Improvements, including. but not limited to, easements, rights-of~way. development rights
(including any mineral rights. water rights and water stock that Trustor may have of whatever
kind or character, surface or underground) (collectively, the "Appurtenances"); provided,
however, if any such Appurtenances benefit both the Real Property and other real property
owned by Trustor that is not encumbered by this Deed of Trust (e.g., utility or access easements
mutually benefiting both properties), Trustor reserves the right to use such Appurtenances for the
benefit of such other appurtenant property that Trustor owns and that is not encumbered by this
Deed of Trust.
"*827-6883-1232.1
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1.2. Riehts. The "Rights" include:
(a) subject to the assignment to Beneficiary as set forth in Section 4
below, all Moneys, issues, income, revenues, royalties and profits now or in the future payable
with respect to or otherwise derived from the Real Property or the ownership, use, management,
operation, leasing or occupancy of the Real Property, including, without limitation, any such
Moneys, issues. income. revenues, royalties and profits which are past due and/or unpaid
(collectively, the "Moneys"):
(b) the Appurtenances;
(c) all present and future right, title and interest of Trustor in and to all
accounts, general intangibles, chattel paper, deposit accounts, money, instruments and
documents (as those terms are defined in the California Uniform Commercial Code (the
"UCC")), and all other agreements, obligations, rights and written materials (in each case
\\hether existing now or in the future), now or in the future relating to or otherwise arising in
connection with or derived from the Real Property or the ownership. use, development,
construction, maintenance. management, operation, marketing. leasing, occupancy, sale or
financing of the Real Property, including the following (collectively, the "Intangibles"):
(i) permits, approvals and other governmental authorizations;
(ii) improvement plans and specifications and architectural drawings;
(iii) agreements with contractors, subcontractors. suppliers, project
managers and supervisors, designers, architects. engineers, sales
agents, leasing agents, consultants and property managers;
(iv) takeout, refinancing and permanent loan commitments:
(v) warranties, guaranties, indemnities and insurance policies, together
with insurance payments and unearned insurance premiums;
(vi) claims. demands. awards, settlements and other payments arising
or resulting from or otherwise relating to any insurance or any loss
or destruction of. injury or damage to, whether or not required,
trespass on or taking, condemnation_ (or conveyance in lieu of
condemnation) or public use of any of the Real Property;
(vii) leases, subleases, rental agreements. license agreements, service
and maintenance agreements, purchase and sale agreements and
purchase options, whether written or verbal. now or in later effect,
together with advance payments, security deposits and other
amounts paid to or deposited with Trustor under any such
agreements;
-tsn.688J.1132.1 2
p _'>'~.n,;al.-\!!erd. Allachmc"I,'E~hlb,t,,~OO~'OS.1 :.19 AHE?.\, Deed of TrulllE,h,t)lj Gl doc
(viii) reserves, deposits, bonds, deferred payments, refunds, rebates,
discounts, cost savings, escrow proceeds, sale proceeds and other
rights to the payment of money. trade names, trademarks, goodwill
and all other types of intangible personal property of any kind or
nature; and
(ix) all supplements, modifications. amendments, renewals, extensions,
proceeds, replacements and substitutions of or to any of such
property.
1.3. Personal Property. The "Personal Property" includes (a) the Intangib]es,
and (b) and all present and future right, title and interest of Trustor in and to all inventory,
equipment, fixtures and other goods (as those terms are defined in the UCC), now or in the future
located at, upon or about, or affixed or attached to or installed in, the Real Property or used or to
be used in connection with or otherwise relating to the Real Property or the ownership, use,
de\'elopment. construction, maintenance, management, operation, marketing, leasing or
occupancy of the Real Property, including furniture, furnishings, machinery, appliances, building
materials and supplies, generators, boilers, furnaces, water tanks, heating, ventilating and air
conditioning equipment, and all other types of tangible personal property of any kind or nature,
and all accessories, additions, attachments, parts, proceeds, products, repairs, replacements and
substitutions of or to any of such property (collectively, the "Goods"); provided that "Persona]
Property" shall not include construction equipment and other personal property used during
construction of improvements on the Real Property that are intended to be removed from the
Real Property upon completion of construction.
2. Grant of Security Interest. Trustor further grants to Beneficiary, pursuant to the
UCe. a security interest in all present and future right, title and interest of Trustor in and to all
Personal Property in which a security interest may be created under the UCe.
3. Fixture Filine. This Deed of Trust covers certain Goods which are or are to
become fixtures related to the Real Property and constitutes a "fixture filing" with respect to
such Goods executed by Trustor (as "debtor") in favor of Beneficiary (as a "secured party").
4. Assienment of Monevs. Trustor irrevocably grants, transfers and assigns to
Beneficiary, during the continuance of this Deed of Trust, $840.000 percent (6.4%) of all of
Trustor's right, title and interest in and to moneys ("Moneys") payable to the Trustor from the
Trustor',-project consisting of the redevelopment, improvement and use of approximately
107,157 square feet, more or less, generally situated 377 East Gilbert Street within the City of
San Bernardino, CA, and referred to as Assessor's Parcel Number(s) 0147-09]-47, consisting of
the construction of eighty-nine (89) one (I) bedroom units designated as affordable housing for
senior citizens of very low income, as defined by federal law and regulations, and one (I) two (2)
bedroom manager's unit (the "Projcct"). Notwithstanding such assignment, so long as no Event
of Default has occurred, Trustor shall have the right to collect, receive, hold and dispose of the
Moneys as the same become due and payable, provided that unless Beneficiary otherwise
consents in \\Titing: (a) any such Moneys paid more than thirty (30) days in advance of the date
whcn due shall be delivered to Beneficiary and held by Beneficiary, to be released and applied
on the date when due (or. if an Event of Default has occurred, at such other time or times and in
-1$-':".6803-1232_1 3
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such manner as Beneficiary may determine), and (b) if an Event of Default has occurred,
Trustor's right to collect and receive the Moneys shall cease and Beneficiary shall have the sole
right, with or without taking possession of the Real Property, to collect all Moneys, including
those past due and unpaid. Any such collection of Moneys by Beneficiary shall not cure or
waive any Event of Default or notice of default, or invalidate any act done pursuant to such
notice. Failure or discontinuance of Beneficiary at any time or from time to time, to collect the
Moneys shall not in any manner affect the subsequent enforcement by Beneficiary of the right to
collect the same. Nothing contained in this Deed of Trust, nor the exercise of the right by
Beneficiary to collect the Moneys, shall be deemed to make Beneficiary a "mortgagee in
possession" or shall be or be construed to be, an affirmation by Beneficiary of or an assumption
of liability by Beneficiary under or a subordination of the lien of this Deed of Trust to, any
tenancy, lease or option. During an Event of Default, any and all Moneys collected or received
by Trustor shall be accepted and held for Beneficiary in trust and shall not be commingled with
Trustor's funds and property, but shall be promptly paid over to Beneficiary.
5. Oblil!ations Secured. This Deed of Trust is given for the purpose of securing
payment and performance of each and every agreement and obligation of Trustor under the
promissory note with a principal amount of Eight Hundred Forty Thousand Dollars ($840,000)
(the "Note") (the terms of which are incorporated herein by this reference) or contained herein or
reciting it is so secured, and payment of any other sum (and any interest thereon) which may
hereafter be loaned to Trustor, or its successors or assigns, when evidenced in writing that they
are secured by this Deed of Trust (the "Secured Obligation").
6. Trustor's Covenants. TO MAINTAIN AND PROTECT THE SECURITY OF
THIS DEED OF TRUST, TO SECURE FULL AND TIMELY PERFORMANCE BY
TRUSTOR OF EACH AND EVERY OBLIGATION, COVENANT AND AGREEMENT OF
TRUSTOR UNDER THE NOTE, AND AS ADDITIONAL CONSIDERATION FOR THE
11\'DEBTEDNESS AND OBLIGATIONS EVIDENCED BY THE NOTE. TRUSTOR HEREBY
COVENANTS. REPRESENTS AND AGREES AS FOLLOWS:
6.1. Pavment and Perfo'rmance of Secured Oblil!ations. Trustor shall pay
and perform all Secured Obligation in accordance with the respective terms of the Note.
6.2. Maintenance of Trust Estate. Unless Beneficiary otherwise consents in
\\Titing, Trustor shall, at its sole cost and expense:
(a) keep the Real Property and Goods in good condition and repair,
and promptly and in a good and workmanlike manner (and with new materials of good quality),
complete any Improvements to be constructed on the Land, repair or restore any part of the Real
Property that may be injured, damaged or destroyed, and repair, restore or replace (at equal or
greater value) any Goods that may be injured. damaged. destroyed or lost. or that may be or
""come obsolete, defective or worn out (except that Trustor shall not be required to repair,
rc,tore or replace any such Goods of insignificant value which are not reasonably necessary or
appropriate to the efficient operation of the Trust Estate), and in each case pay when due all valid
claims for labor. service, equipment and material and any other costs incurred in connection with
any such action. and not permit any mechanics lien to arise against the Real Property or Goods,
or adequately furnish a loss or liability bond against such lien claim;
-IS: 7 -h88~-1 :~2 1
-1
, "",:J, Ascn~. AI\~d"n(nls'l:.,hJ(-.'II':(\n< 0<-1 :-1 0 AHFPA Deed of TrUll {f,h,b,\ GI o..,c
(b) except as otherwise consented to by Beneficiary In writing, not
remove, demolish or materially alter any Improvements;
(c) not construct any Improvements on the Land or undertake any site
development work unless approved by any applicable governmental agencies;
(d) not commit or permit any waste of any part of the Real Property;
(e) not permit or consent to any restriction that would prevent or
otherwise impair the use or development of the Real Property;
(f) comply in all material respects with all applicable laws and other
governmental requirements, present or future, and not commit or permit any material violation of
any applicable laws or other governmental requirements, which affect any part of the Trust
Estate or require any alterations or improvements to be made to any part of the Real Property;
(g) take such action from time to time as may be reasonably necessary
or appropriate or as Beneficiary may reasonably require, to protect the physical security of the
Real Property and Goods;
(h) except as otherwise consented to by Beneficiary in writing, not
part with possession of or abandon any part of the Trust Estate or Goods or cause or permit any
interest in any part of the Trust Estate to be sold, transferred, leased, encumbered, released,
relinquished, terminated or otherwise disposed of (whether voluntarily, by operation of law or
otherwise), other to an affiliate of Trustor (which such affiliate shall mean an entity owned by
Trustor or its principals and Trustor or its principals shall be responsible for the day-to-day
management of its activities);
(i) take all other action which may be reasonably necessary or
appropriate to preserve, maintain and protect the Trust Estate and Goods, including the
enforcement or performance of any rights or obligations of Trustor or any conditions with
respect to any Rights;
(j) provide to Beneficiary, within five (5) days following receipt of
Geneticiary's request, copies of all lease and sale agreements of any kind encumbering the Real
Property or Goods, certified by Trustor to be true and correct copies of valid agreements, as well
as any other documentation reasonably requested by Beneficiary; and
(k) notify Beneficiary in writing if any condition at or on the Real
Property may have a signiticant and measurable effect on its market value.
6.3. Insurance, Condemnation and Damal!e Claims. Trustor shall maintain
",tll nsks" and general public liability insurance on the Real Property to the extent and in the
form required by Beneticiary. All proceeds of any claim, demand. award. settlement or other
payment arising or resulting from or otherwise relating to any such insurance or any loss or
destruction of, injury or damage to, trespass on or taking, condemnation (or conveyance in lieu
of condemnation) or public use of any of the Real Property (a "Damage Claim") are assigned and
shall be payable and delivered to Beneficiary (any such proceeds of any Damage Claim being
.U;27-b883-1132I
5
~ '.ce"ja, ,A~en.:la Atio.:h"1eni, E~hlb'I' 21~1' .c:,. I:. I" "HE I'.>. D~~d of T ""t (I, ,I"hol Gl .1".:
referred to in this Deed of Trust as "Damage Proceeds"). Trustor shall take all action reasonably
necessary or required by Beneficiary in order to protect Trustor's and Beneficiary's rights and
interests with respect to any Damage Claim, including the commencement of. appearance in and
prosecution of any appropriate action or other proceeding, and Beneficiary may in its discretion
participate in any such action or proceeding at the expense of Trustor.
So long as no Event of Default has occurred, Trustor may settle, compromise or
adjust any Damage Claim. Upon the occurrence of any Event of Default, Beneficiary shall have
the sole right to settle, compromise or adjust any Damage Claim in such manner as Beneficiary
may determine, and for this purpose Beneficiary may, in its own name or in the name of Trustor,
take such action as Beneficiary deems appropriate to realize on any such Damage Claim. In
either case, all Damage Proceeds payable in connection with any such Damage Claim shall be
delivered directly to Beneficiary as provided in the preceding paragraph.
Any Damage Proceeds received by Beneficiary may be applied by Beneficiary in
payment of the Secured Obligations in such order and manner as Beneficiary may determine,
provided that so long as no Event of Default has occurred, Beneficiary shall release such
Damage Proceeds to Trustor for the repair and restoration of the Real Property, except that
Beneficiary shall not be required to release such Damage Proceeds (and may apply such Damage
Proceeds to the Secured Obligation as set forth above) to the extent that such Damage Proceeds
relate to any condemnation, seizure or other appropriation by any governmental agency of all or
any portion of the Real Property (including Damage Proceeds payable in lieu of any such action),
or if Beneficiary has reasonably determined that the security of this Deed of Trust has been
impaired, or will be impaired upon release of Damage Proceeds to Trustor.
6.4. Liens and Taxes. Trustor shall pay, prior to delinquency, all taxes,
charges, fees, costs and expenses which are or may become a lien affecting any part of the Trust
Estate (including assessments on appurtenant water stock). and Trustor shall pay and perform
when due all other obligations secured by or constituting a lien affecting any part of the Trust
Estate. If Trustor is in default under this Deed of Trust or the Note. regardless of whether the
Default has been cured, then Beneficiary or Trustee may at any subsequent time, at its option to
b~ exercised on thirty (30) days written notice to Trustor. require Trustor to deposit with
Beneficiary or its designee, a the time of each payment of an installment of interest or principal
under the Note, an additional amount sufficient to discharge the obligations of Trustor under this
Section 6. The calculation of the amount payable and of the fractional part of it to be deposited
with Beneficiary shall be made by Beneficiary in its sole and absolute discretion. If the amounts
deposited are in excess of the actual obligations for which they were deposited, Beneficiary may
refund any such excess, or at its sole option, may hold the excess in a reserve account, not in
trust and not bearing interest, and reduce proportionately the required deposits for the ensuing
year.
6.5. Claims. Trustor shall appear in and defend any claim or any action or
uther proceeding purporting to affect title or other interests relating to any part of the Trust
Estate. the security of this Deed of Trust or the rights or powers of Bene!iciary or Trustee, and
gi\e Beneficiary prompt written notice of any such claim, action or proceeding. Beneficiary and
Trustee may, at the expense of Trustor, appear in and defend any such claim, action or
proceeding and any claim. action or other proceeding asserted or brought against Beneficiary
.J.';~7-('S83-1232 I
6
''';'H'' AgcnJ. _\lIOlhmer>I' !:.h,b'l; ;I)C~'()'.I:-I'l AHfPA lJeoJ "1 T'~;l (hh,b,! (,'J dOl
(and Beneficiary" s general partners, agents, employees, partners, unitholders, shareholders,
affiliates, officers and directors, each a "Beneficiary Indemnitee"), or Trustee in connection with
or relating to any part of the Trust Estate or this Deed of Trust.
6.6 Leases of Real Property. At Beneficiary's request, Trustor shall furnish
Beneficiary with executed copies of all leases of the Real Property or any portion of it.
6.7 Uniform Commercial Code Security Al!reement. This Deed of Trust is
intended to be and shall constitute a security agreement under the California Uniform
Commercial Code (UCC) for any of the Personal Property noted herein, that, under law may be
subject to a security interest under the UCC, and Trustor grants to Beneficiary a security interest
in those items. Trustor authorizes Beneficiary to file financing statements in all states, counties
and other jurisdictions as Beneficiary may elect, without Trustor's signature if permitted by law.
Trustor agrees that Beneficiary may file this Deed of Trust, or a copy of it, in the real estate
records or in the Office of the Secretary of State of the State of California and such other states
Beneficiary may elect, as a financing statement for any of the items specified above.
7. Default
7.1. Events of Default. For all purposes in this Deed of Trust, the term "Event
of Default" or "default" shall mean:
(a)
(b)
(c)
(d)
(el
(I)
..t3:~.IlS83.] 232]
The Trustor fails to make any payment when due.
The Trustor defaults on any promise the Trustor has made to the Trustee
or Beneficiary or if the Trustor otherwise fails to comply with or to
perform when due any other term, obligation, covenant or condition
contained in this Deed of Trust or any agreement related to this Deed of
Trust.
The Trustor defaults under any loan, extension of credit, security
agreement, purchase or sales agreement, or any other agreement, in favor
of any other creditor or person that may materially affect any of the
Trustor's property or the Trustor's ability to repay the Note or the ability
of the Trustor to perform its other obligations under this Deed of Trust.
Any representation or statement made or furnished to the Trustee or the
Beneficiary by the Trustor or on the Trustor's behalf is false or misleading
in any material respect either now or at the time made or furnished.
If the Trustor becomes insolvent, or if a rccei\'Cr is appointed for any part
'If the Trustor's property. or if the Trustor makes an assignment for the
benefit of creditors, or any proceeding is commenced either by the Trustor
or against the Trustor under any bankruptcy or insolvency laws.
Any creditor tries to take any of the Trustor's property on or in which the
Trustee or the Beneficiary has a lien or security interest.
i'\,;rll~.l' Agenda Au~,hmenl,E~h,blt,':OO~\O~-l:. 19 _-'<HE!' A lked of T rlJ'l (E~hlbl\ G) .J,,~
7
(g) A material adverse change occurs in the Trustor's financial condition, or
the Trustee or Beneficiary believes the prospect of payment or
performance of the indebtedness evidenced by this Deed of Trust is
impaired.
(h) The failure for any reason of this Deed of Trust to remain at all times a
valid first lien upon the Trust Estate, unless the Trustee or the Beneficiary
consents in writing to the subordination of this Deed of Trust;
(i) The sale, transfer, assignment, conveyance, mortgage or hypothecation of
all or any portion or interest in the Trust Estate without obtaining the prior
written consent of Beneficiary), other to an affiliate of Trustor (which such
affiliate shall mean an entity owned by Trustor or its principals and
Trustor or its principals shall be responsible for the day-to-day
management of its activities).
(j) Notwithstanding Sections 7.I(b) through (i) above, Trustor shall not be in
default unless Trustor fails to cure a breach within fifteen (15) business
days after receipt of written notice from Trustee or Beneficiary of such
breach, and if any other provision of this Deed of Trust or any provision of
the Secured Obligation shall provide for a greater period of time within
which to cure any event or condition, then an Event of Default shall not be
deemed to have occurred unless Trustor shall fail to cure such event or
condition within such specified greater period of time.
7.2. Remedies. Upon the occurrence of any Event of Default Trustor shall
then be in default under this Deed of Trust, and upon acceleration of the maturity of the Secured
Obligation. the Secured Obligation shall immediately become due and payable without further
notice to Trustor, and Beneficiary may, without notice to or demand upon Trustor, which are
expressly waived by Trustor (except for notices or demands othcrwise required by applicable
laws to the extent not effectively waived by Trustor and any notices or demands specified
below), and without releasing Trustor from any of its obligations. either directly or through an
agent or court-appointed receiver, and without regard to the adequacy of any security for the
Secured Obligation, exercise anyone or more of the following remedies, as Beneficiary may
determine in its sole and absolute discretion:
(a) enter. take possession of, manage, operate, protect, preserve and
maintain and exercise any other rights of an owner of, the Trust Estate, and use any other
properties or facilities of Trustor relating to the Trust Estate, all without payment of rent or other
compensation to Trustor;
(b) enter into such contracts and take such other action as Beneficiary
deems appropriate to complete all or any part of the Trust Estate including but not limited to any
construction of Improvements on the Land, subject to such modifications and other changes in
any plan of development as Beneficiary may deem appropriate in its sole and absolute discretion;
4827-6883-1232 ]
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P Agcnda~,A!?enda "'Uad,menll E~n:bill,:OO~,OS-I;-19 AHEPA Deed of Tn.l.\I IE.nlb'l G) doc
(c) make, cancel, enforce or modify sale or lease agreements, sale
prices, lease rates or marketing plans and, in its own name or in the name of Trustor, otherwise
conduct any business of Trustor in relation to the Trust Estate and deal with Trustor's creditors,
debtors, tenants. prospective tenants, agents and employees and any other persons having any
relationship with Trustor in relation to the Trust Estate, and amend any contracts between them,
in any manner Beneficiary may determine with Trustor executing a power of attorney or similar
document required in order for Beneficiary to exercise such rights;
(d) either with or without taking possession of the Trust Estate, notify
obligors on any rights that all payments and other performance are to be made and rendered
directly and exclusively to Beneficiary, and in its own name supplement, modify, amend, renew,
extend, accelerate, accept partial payments or performance on, make allowances and adjustments
and issue credits with respect to, give approvals, waivers and consents under, release, settle,
compromise, compound, sue for, collect or otherwise liquidate, enforce or deal with any rights,
including collection of amounts past due and unpaid (Trustor agreeing not to take any such
action after the occurrence of an Event of Default without prior written authorization from
Beneficiary);
(e) endorse, in the name of Trustor, all checks, drafts and other
eyidences of payment relating to the Trust Estate, and receive. open and dispose of all mail
addressed to Trustor and notify the postal authorities to change the address for delivery of such
mail to such address as Beneficiary may designate with Trustor executing a power of attorney or
similar document required in order for Beneficiary to exercise such rights;
(I) take any such other action as Beneficiary deems appropriate to
protect the security of this Deed of Trust; and
(g) Notwithstanding Sections 7.2(a) through (g), neither Beneficiary
nor Trustee shall be under any obligation to preserve, maintain or protect the Trust Estate or any
of Trustor's rights or interests in the Trust Estate, or make or give any presentments, demands for
performance, protests, notices of nonperformance, protest or dishonor or other notices of any
kind in connection with any rights, or take any other action with respect to any other matters
relating to the Trust Estate. Beneficiary and Trustee do not assume and shall have no liability
for. and shall not be obligated to perform, any of Trustor's obligations with respect to any rights
or any other matters relating to the Trust Estate, and nothing contained in this Deed of Trust shall
release Trustor from any such obligations.
7,3, Foreclosure Remedv. Beneficiary, in its sole and absolute discretion,
may execute and deliver to Trustee written declaration of default and demand for sale and
wTitten notice of default and of election to cause all or any part of the Trust Estate to be sold,
which notice Trustee shall cause to be filed for record; and after the lapse of such time as may
then be required by law following the recordation of such notice of default, and notice of sale
having been given as then required by law, Trustee, without demand on Trustor, shall sell such
Trust Estate property at the time and place fixed by Trustee in such notice of sale, either as a
whole or in separate parcels and in such order as Beneficiary may direct (Trustor waiving any
right to direct the order of sale), at public auction to the highest bidder for cash in lawful money
of the United States (or cash equivalents acceptable to Trustee to the extent permitted by
~827.6883.12321
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I'A~~ndal Asenda Altachmen1~"E~I"bll$':OO~,05.:2.1<j AHEPA Deed or TruSl (E,hibil Gl doc
applicable law), payable at the time of sale. Trustee may postpone the sale of all or any part of
the Trust Estate by public announcement at such time and place of sale, and from time to time
after any such postponement may postpone such sale by public announcement at the time fixed
by the preceding postponement. Trustee shall deliver to the purchaser at such sale its deed
conveying the property so sold, but without any covenant or warranty, express or implied, and
the recitals in such deed of any matters or facts shall be conclusive proof of the truthfulness
thereof. Any such sale shall be free and clear of any interest of Trustor and any purchase
agreement, encumbrance or other matter affecting the property sold which is subject or
subordinate to this Deed of Trust, unless Beneficiary consents to otherwise in writing. Any
person. including Trustee or Beneficiary, may purchase all or any part of the Trust Estate at such
sale. Any bid by Beneficiary may be, in whole or in part, in the form of cancellation of all or any
part of the Secured Obligation (the "Credit Bid").
7.4. Secured Creditor Remedy. With respect to any Personal Property,
Beneficiary shall have in any jurisdiction where enforcement of this Deed of Trust is sought, all
remedies of a secured party under the UCC and may require Trustor. on demand, to assemble all
Personal Property and make it available to Beneficiary at places that Beneficiary may select that
are reasonably convenient for both parties.
7.5. Other Remedies. Beneficiary may proceed to protect, exercise and
enforce any and all other Remedies provided under the Secured Obligation or by applicable laws.
Each of the remedies provided in this Deed of Trust is cumulative and not exclusive of, and shall
not prejudice, any other remedy provided in this Deed of Trust, the Secured Obligation or
pursuant to all applicable laws. Each remedy may be exercised from time to time as often as
deemed necessary by Trustee and Beneficiary, and in such order and manner as Beneficiary may
determine. This Deed of Trust is independent of any other security for the Secured Obligation,
and upon the occurrence of an Event of Default. Trustee or Beneficiary may proceed in the
enforcement of this Deed of Trust independently of any other remedy that Trustee or Beneficiary
may at any time hold with respect to the Trust Estate or the Secured Obligations or any other
security. Trustor, for itself and for any other person claiming by or through Trustor. waives, to
the fullest extent permitted by applicable laws. all rights to require a marshalling of assets by
Trustee or Beneficiary or to require Trustee or Beneficiary to first resort to any particular portion
of the Trust Estate or any other security (whether such portion shall have been retained or
conveyed by Trustor) before resorting to any other portion, and all rights of redemption, stay and
appraisal.
7.6. ADDlication of Sums. Unless otherwise specified in this Deed of Trust or
the Secured Obligation, all sums received by Beneficiary under this Deed of Trust, shall be
applied to: (i) all costs and expenses incurred by Beneficiary, Trustee or any receiver under this
Deed of Trust, including, without limitation, attorneys fees; and (ii) the remainder, in payment of
the Secured Obligation in such order and manner as Beneficiary shall determine in its sole
discretion; provided, however, that Beneficiary shall have no liability for funds not actually
received by Beneficiary.
4827-6883-1232.1
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P ....;1enJa;Asen<la All..:hmt"I\'E~hLb'l\ :oos O~.I:-19 .l,HEP.... Deed orTru\1 {EdlLb'l G} doc
7.7. Costs, Fees and Expenses. Trustor shall pay, on demand, all costs, fees,
expenses, advances, charges, losses and liabilities of Trustee and Beneficiary under or in
connection with this Deed of Trust or the enforcement of, or the exercise of any remedy or any
other action taken by Trustee or Beneficiary under, this Deed of Trust or the collection of the
Secured Obligations, in each case including but not limited to: (a) reconveyance and foreclosure
fees of Trustee; (b) costs and expenses of Beneficiary or Trustee or any receiver appointed under
this Deed of Trust in connection with the operation, maintenance, management, protection,
preservation, collection, sale or other liquidation of the Trust Estate or foreclosure of this Deed
of Trust; (c) advances made by Beneficiary to complete or partially construct all or any part of
the Improvements or any other construction on the Land or otherwise to protect the security of
this Deed of Trust; (d) cost of evidence of title; and (e) the reasonable fees and expenses of
Trustee's and Beneficiary's legal counsel and other out-of-pocket expenses. and the reasonable
charges of Beneficiary's internal legal counsel incurred as a result of an Event of Default;
together with interest on all such amounts until paid (i) at the Default Rate (as defined in the
Note) in the case of any such interest payable to Beneficiary and (ii) at the rate provided by law
in the case of any such interest payable to Trustee.
7.8. Late Payments. By accepting payment of any part of the Secured
Obligation after its due date, Beneficiary does not waive its right either to require prompt
payment when due of all other portions of the Secured Obligation or to declare a default for
failure to so pay.
7.9. Action by Trustee. At any time and from time to time upon written
request of Beneficiary and presentation of this Deed of Trust for endorsement, and without
affecting the personal liability of any person for payment of the Secured Obligation or the
security of this Deed of Trust for the full amount of the Secured Obligations on all property
remaining subject to this Deed of Trust, Trustee may, without notice and without liability for
such action. and notwithstanding the absence of any payment on the Secured Obligations or any
other consideration: (a) reconvey all or any part of the Trust Estate: (b) consent to the making
and recording, or either, of any map or plat of the Land; (c) join in granting any easement
affecting the Land; or (d) join in or consent to any extension agreement or any agreement
subordinating the lien of this Deed of Trust. Trustee is not obligated to notifv Trustor or
- .
Beneficiary of any pending sale under any other deed of trust or of any action or other
proceeding in which Trustor, Beneficiary or Trustee is a party unless brought by Trustee.
8. Reconyeyance. Upon Beneficiary's written request and surrender of this Deed of
Trust and the Notes to Trustee for cancellation or endorsement, Trustee shall reconvey, without
warranty. all or any part of the Trust Estate then subject to this Deed of Trust that Beneficiary so
instructs. Any reconveyance, whether full or partial, may be made in terms to "the person or
persons legally entitled thereto," and the recitals in such reconveyance of any matters or facts
shall be conclusive proof of the truthfulness thereof. Beneficiary shall not be required to cause
any Trust Estate to be released from this Deed of Trust until final payment and performance in
full of the Secured Obligation and termination of all obligations of Beneficiary under or in
connection with the Note.
-IS:7-6RS3-1232I
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P ;~~nd~, A!,'"".h Anachlll.l1t,E ~hlbll~200S,v~-1 ~-] 9 AHEPA Deed of Tru~'. (E~h,bl( G) doc
9. Hazardous Materials.
9.1. Definitions. For the purposes of this Deed of Trust: (a) "Hazardous
Materials" shall mean oil and other petroleum products, flammable explosives, asbestos, urea
formaldehvde insulation, radioactive materials, hazardous waste, toxic or contaminated
substance; or similar materials, including, without limitation, any substances which are
"hazardous substances", "hazardous waste", "hazardous materials", or "toxic substances" under
applicable environmental laws, ordinances or regulations; (b) "Hazardous Materials Laws" shall
mean all statutes, ordinances, rules and regulations relating to Hazardous Materials, including,
without limitation, those relating to soil and groundwater conditions; and (c) "Hazardous
Materials Claims" shall mean claims or actions pending or threatened against Trustor or the Real
Property by any governmental entity or agency or any other person or entity relating to
Hazardous Materials or pursuant to Hazardous Materials Laws.
9.2. Trustor's Oblieations. .Except in the ordinary course of Trustor's
business, Trustor shall not cause or permit the Real Property to be used as a site for the use,
generation, manufacture, storage, treatment, release, discharge, disposal, transportation or
presence of any Hazardous Materials. Trustor shall comply and cause the Real Property to
comply with all Hazardous Materials Laws. Trustor shall immediately notify Beneficiary in
writing of: (i) the discovery of any Hazardous Materials on, under or about the Real Property; (ii)
any knowledge by Trustor that the Real Property does not comply with any Hazardous Materials
Laws or (iii) any Hazardous Materials Claim. After such notice, Beneficiary shall have the right
to inspect the Real Property. Beneficiary may request and Trustor shall provide at its sole costs
and expense, within sixty (60) days, a report from a qualified engineering company or other
qualified consultant acceptable to Beneficiary, with respect to an investigation and audit of the
Real Property satisfactory to Beneficiary. Additionally, in response to the presence of any
Hazardous Materials on, under or about the Real Property. Trustor shall immediately take, at
Trustor's sole cost, all remedial action required by any Hazardous Materials Laws or any
judgment consent decree, settlement or compromise in respect of any Hazardous Materials
Claims.
10. Miscellaneous.
10.1. Deed of Trust Is Due on Sale. The Trustee (or the Beneficiary) may, at
its option. declare immediately due and payable all sums secured by this Deed of Trust upon the
sale, transfer or further encumbrance without the prior written consent of the Trustee (or the
Beneficiaryfof all or any part of the Real Property. or any interest in the Real Property. A "sale,
transfer or encumbrance" means the conveyance of the Real Property or any right, title or interest
therein; whether legal, beneficial, or equitable; whether voluntary or involuntary; whether by
outright sale, deed, the creation of a new installment sale contract, land contract, contract for
deed, leasehold interest in the Property with a term greater than one (I) year. lease-option
contract, or by sale, assignment, or transfer of any beneficial interest in or to any land trust
holding title to the Property, or by any other method of conveyance of property interest.
..fR27-ClSS3-1232I
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~ \,<'lda> A~endJ"nachm~nIS E,hLb'I~100S,OS_I:_19 AHEPA Dt~d of Tru'l (E.h,b'l G) 00':
10.2. Attornev-in-Fact. Trustor appoints Beneficiary as Trustor's attorney-in-
fact, with full authority in the place of Trustor and in the name of Trustor or Beneficiary, to take
such action and execute such documents as Beneficiary may reasonably deem necessary or
advisable in connection with the exercise of any remedies or any other action taken by
Beneficiary or Trustee under this Deed of Trust.
10.3. Successors and Assil!ns. This Deed of Trust applies to and shall be
binding on and inure to the benefit of all parties to this Deed of Trust and their respective
successors and assigns,
10.4. Acceptance. Notice of acceptance of this Deed of Trust by Beneficiary or
Trustee is waived by Trustor. Trustee accepts this Deed of Trust when this Deed of Trust, duly
executed and acknowledged, is made a public record as provided by law,
10.5. Beneficiary's Statements. For any statement regarding the Secured
Obligations. Beneficiary may charge the maximum amount permitted by law at the time of the
request for such statement.
10.6. Governinl! Law. This Deed of Trust shall be governed by and construed
and enforced in accordance with, the laws of the State of California.
10.7. Request for Notice. Trustor requests that a copy of any notice of default
and a copy of any notice of sale be mailed to Trustor at Trustor's address as first set forth above.
10.8. Attornev's Fees. Should either party commence an action of any kind
whatsoever against the other to enforce any obligation under this Agreement, the prevailing party
shall be entitled to recover its costs and reasonable attorneys' fees (including disbursements)
from the other, whether or not such action is pursued to judgment.
10.9. Substitution of Trustee. Beneficiary may from time to time, by
instrument in \\Titing, substitute a successor or successors to any Trustee named in or acting
under this Deed of Trust. which instrument. when executed by Beneficiary and duly
acknowledged and recorded in the office of the recorder of the county or counties where the
Lind is slluated, shall be conclusi\'e proof of proper substitution of such successor Trustee or
Trustees who shall, without conveyance from the predecessor Trustee. succeed to all of its title,
estate, rights. powers and duties. Such instrument shall contain the name of the original Trustor,
Trustee and Beneficiary, the book and page where this Deed of Trust is recorded (or the date of
recording and instrument number) and the name and address of the new Trustee.
;\..: -!',"hj-i23:!1
13
P A,.'"'JJ;.Age,,jJ AllachmCll!; .E~h,bLl' "UU~ l,S-I: :'1 AJ!EPA Deed ufTf'.J"lhh,h" Cd doc
IN WITNESS WHEREOF, Trustor hereby executes this Deed of Trust as of the
date set forth below.
"TRUSTOR":
AHEP A National Housing CorporatlOn-AHEP A
Local Arrowhead 302 Chapter
Date:
By:
Title:
l' ~ -. ~'~1\~-1232 1
l-l
j> .-'.." ,,, "~"rdJ .\tla,;h:"el1\' 1"h,O,\; .2uu' ',,)- i~-I'" -\H.Jol'A Oed ,'1 1 'U,! It:d"h'l G) d.:lC
EXHIBIT "A"
LEGAL DESCRIPTION OF SITE
PARCEL I OF PARCEL MAP 6660, AS PER MAP RECORDED IN BOOK 67, PAGES 16
AND 17 OF PARCEL MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID
COUNTY.
-":-':-:,;-12321
15
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