HomeMy WebLinkAboutR32-Economic Development
CITY OF SAN BERNARDINO
ECONOMIC DEVELOPMENT AGENCY
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SINAL
FROM: Emil A Marzullo
Interim Executive Director
SUBJECT:
California Housing Foundation, Inc., a non-
profit 501(c)(3) organization - 2008 Low and
Moderate Income Housing Funds Loan and
Grant Property Acquisition Agreement for the
benefit of the developmentally disabled adults
DATE: October 29, 2008
SvnoDsis of Previous Commission/Council/Committee Action(s):
On September 18, 2008, Redevelopment Committee Members Estrada. Johnson and Baxter unanimously voted to recommend
that the Community Development Commission consider this action for approvaL
_____~___________________ _____________________ ___________________________ ___________________________ _______________________________ ____________________________________ ______________u____________________
Recommended Motion(s):
(Communitv DeveloDment 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 2008 Low and Moderate Income Housing Funds Loan and Grant Property
Acquisition Agreement by and between the Agency and California Housing Foundation. Inc., for the benefit of
the developmentally disabled adults
Contact Person(s):
Carey K. Jenkins
Phone:
(909) 663-1044
5
Project Area(s):
N/A
Ward(s):
Supporting Data Attached: 0 Staff Report 0 Resolution(s) 0 Agreement(s)/Contract(s) D Map(s) D Letter(s)
not to
exceed
FUNDING REQUIREMENTS: Amount: $ $400,000 Source: 20% Housing Set-Aside Funds
Budget Authority:
2008-2009 Budget
Signature:
Fiscal Review:
,~v c~Lh~
Barbara Lindseth, Administrative Servo es Director
Emil A Marzu
cutive Director
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!'\AgendasIComm Dcv Commission\COC 2008\11-03-08 California Housing Foundation - Grant Agreement SR. doc
COMMISSION MEETING AGENDA
Meeting Date: 11/03/2008
Agenda Item Number: .123:2-
/I- 3 ,oS
ECONOMIC DEVELOPMENT AGENCY
STAFF REPORT
CALIFORNIA HOUSING FOUNDATION, INC., A NON-PROFIT 501(C)(3) ORGANIZATION -
2008 LOW AND MODERATE INCOME HOUSING FUNDS LOAN
AND GRANT PROPERTY ACQUISITION AGREEMENT FOR THE BENEFIT
OF THE DEVELOPMENT ALLY DISABLED ADULTS
BACKGROUND:
On September 8, 2008, the Redevelopment Agency of the City of San Bemardino ("Agency") received a
request for financial assistance from the California Housing Foundation, Inc. (the "Project Sponsor").
Specifically, the request called for funding support in order to acquire two properties that are presently for sale
and located at the following addresses: 6538 North Jordan Lane and 6728 Ofelia Drive in the City of San
Bernardino ("City"). Both properties are in the Verdemont Area of the 5th Ward. Once acquired, these homes
would be refurbished, landscaped and equipped with furniture in order to provide permanent housing for
developmentally disabled adults (the "Project").
Established in 1998, the Project Sponsor is a California non-profit, public benefit corporation with a 501(c)(3)
tax exemption affiliated with the Inland Regional Center ("IRC"). Located in Redlands, the mission of the
Project Sponsor is to acquire, develop and/or rehabilitate single-family homes for the benefit of those
developmentally disabled adults who are presently living in substandard housing or with family members who
struggle with meeting the daily needs of these individuals.
Based on their business model, the Project Sponsor locates sites to acquire, then rehabilitates the existing
homes or, if vacant land has been identified, builds new homes. Their goal is to seek out generally stable
residential neighborhoods so that their clients can integrate into the community without fear of being victims
of illicit criminal and/or violent activities. Once the site has been located, the Project Sponsor seeks funding
through various sources including the IRC, local public sector contributions and private lending institutions.
When financing is secured, the site is acquired and construction completed, the Project Sponsor obtains long-
term lease agreements with professionally certified operators to manage the facilities and care for the
residents. In all cases, the Project Sponsor receives resident referrals from the IRC in addition to a guaranteed
financial contribution of up to 25% of the total project cost. Attached is a letter of support for the Project from
the Chief of Community Services of the IRe.
The Project Sponsor currently owns and leases 14 properties in the cities of Redlands, Palm Desert, Beaumont,
Hemet, Perris and Apple Valley. Based on a review of photographs and discussions with representatives of
the IRC, all appear to be operating appropriately and are very well maintained. The proposed Project
acquisitions would be the first in the City by the Project Sponsor.
CURRENT ISSUE:
Based on a review of the proforma for the Jordan Avenue property, the Project Sponsor recently submitted an
offer to acquire the site for $325,000, which is well below the original March I, 2006, purchase price of
$482,500. An additional $185,000 would be used to refurbish, landscape, install new furniture and provide
start up capital. Approximately $25,000 would also be needed to off-set financing costs during the
construction/rehabilitation period for a total project cost estimated to be $535,000. With the IRe's 25%
P \Agendas\Comm De" Commission\CDC 2008\lj.03_08 California Housing Foundation. Grant Agre~menl SR,doc
COMMISSION MEETING AGENDA
Meeting Date: 11/03/2008
Agenda Item Number: 1<32.
11~':l.-h~
Economic Development Agency Staff Report
California Housing Foundation - Grant Agreement
Page 2
capital contribution of $134,000 and private capital provided by Arrowhead Credit Union in the amount of
$201,000.
The proforma for the Ofelia Drive property is very similar with a proposed acquisition price of$315,000. On
February 27, 2007, the same property sold for $509,000. In addition to the acquisition cost, $185,000 will also
be spent to refurbish, landscape, install new furniture and provide start up capital. And, like the Jordan
A venue property, $25,000 would be allocated to the financing cost associated with the
construction/rehabilitation period. Added together, the total project cost would be an estimated $525,000. In
this case, the IRC would pledge $133,000 to the Project while capital contributions in the amount of$192,000
from Arrowhead Credit Union would be made available. A total of $400,000 of the Agency's Loan/Grant will
be contributed to the purchase of both properties.
In order to identify the number of existing facilities in the immediate area of the Project that provide the same
services, Agency Staff reviewed online data from the California Department of Social Services (the "CDSS"),
Community Care Licensing Division that publishes the locations of Adult Residential Facilities and monitors
their program activities. If approved, the Project would have to seek licensure through CDSS and their
Community.Care Licensing Division. When a search was completed, the following addresses were identified:
6055 Olive Avenue, 6145 Olive Avenue, 4461 Bronson Street, 5110 Sierra Road, 2414 Ogden Street and 2790
Akron Street. Based on this review, all are in the 92407 zip code and none appear to be within a Y2 mile of the
two sites comprising the Project.
As for staffing, none ofthe personnel will live in these homes, but each will have two or more staff on site 24
hours a day, seven days a week to ensure the safety of the residents and the integrity of the facility. The
staffing requirements for the Project will include one General Manager with an annual salary of $48,000, two
Facility Managers, each with annual salaries of $36,000 and up to 13 support staff with average salaries of
$10.00 per hour.
ENVIRONMENTAL IMP ACT:
None.
FISCAL IMPACT:
An amount up to $400,000 would be used from the Agency's Housing Set Aside Fund to assist in the
financing of the Project. As a result, a 55-year affordability covenant would be placed on both residences
comprising the Project.
RECOMMENDATION:
That the Community Development Commission adopt the attached Resolution.
xecutive Director
)
COMMISSION MEETING AGENDA
Meeting Date: 11/03/2008
Agenda Item Number: 1t32-
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P\Agcndas\Comm Dev Commi,sionlCDC 2008\11.03-08 California llousing Foundation - Grant Agreement SR doc
INLAND REGIONAL CENTER
... valuinf! independence. inclusion and empowerment
674 Brier Drive, San Bernardino, CA 92408
P.O. Box 6127, San Bernardino, CA 92412-6127
Telephone: 909-890-3000
Fax: 909-890-3001
September S, 2008
Steve Von Rajcs
California Housing Foundation
1200 California Ste 104
Redlands, CA 92374
Dear Mr. Von Rajcs,
This letter is in follow up to our conversation and subsequent plans to work in partnership toward
obtaining and developing sustainable housing options for people who have Developmental Disabilities in
Riverside and San Bernardino Counties.
IRC has received preliminary approval from the Department of Developmental Services to support your
acquisition of housing up to 2S% of the total cost. We are confident that we can receive final approval
from the Department of Developmental Services to provide such support to CHF once you are able to
identify potential sources to leverage funds. IRC has reviewed your two proposed properties and both
appear to be quite promising. I look forwarding to hearing from you soon. Please feel free to reach me
at (909) 890-3493.
Sincerely,
/
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~c~rj;'o1f[;;~M.~
Chief, Community Services
CD:sg/IRC/9-S-08
cc: Mary Lynn Clark, Director
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RESOLUTION NO.
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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
2008 LOW AND MODERATE INCOME HOUSING FUNDS LOAN AND
GRANT PROPERTY ACQUISITION AGREEMENT BY AND BETWEEN
THE AGENCY AND CALIFORNIA HOUSING FOUNDATION, INC., FOR
THE BENEFIT OF THE DEVELOPMENT ALL Y DISABLED ADULTS
WHEREAS, the Redevelopment Agency of the City of San Bernardino (the "Agency") is a
body, corporate and politic, organized and existing under California Community
10 Redevelopment Law (the "CRL"), as found at Health and Safety Code section 33000, et seq.; and
11
WHEREAS, the Community Development Commission of the City of San Bernardino (the
12 "Commission") is the governing board of the Agency; and
13
WHEREAS, the California Housing Foundation, Inc. (the "Grantee"), was formed in 1998
14 and incorporated within the State of California as a non-profit organization with the mission 0
15 acquiring and leasing residential properties to licensed operators of facilities that house and care for
16 developmentally disabled adults; and
17
WHEREAS, the Grantee has identified two separate residences within the City of San
18 Bernardino for acquisition with the following addresses: 6538 North Jordan Lane and 6728 Ofelia
19 Drive; and
20
WHEREAS, the Agency desires to assist with the acquisition and rehabilitation of these
21 two residences in order to further the Grantee's mission of providing housing opportunities to
22 developmentally disabled adults (the "Project"); and
23 WHEREAS, the Project is categorically exempt under the California Environmental
24 Quality Act ("CEQA"); and
25 WHEREAS, the Agency concurrently desires to provide up to $400,000 to the Grantee
26 towards the Project and record a 55-year Covenant, Conditions and Restrictions on each property;
27 and
28
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P:\Agendas\Rcsolutions\Resolutions\2008\II-03.oS California Housing Foundation - Grul A8r~ment CDC Reso.doc
1 WHEREAS, it is appropriate for the Commission to take action with respect to approving
2 and entering into the 2008 Low and Moderate Income Housing Funds Loan and Grant Property
3 Acquisition Agreement ("Agreement") with the Grantee in the form as attached hereto.
4 NOW, THEREFORE, THE COMMUNITY DEVELOPMENT COMMISSION OF THE
5 CITY OF SAN BERNARDINO DOES HEREBY RESOLVE, DETERMINE AND ORDER, AS
6 FOLLOWS:
7
Section 1.
The Commission hereby approves the Agreement with the Grantee for the
8 purpose of acquiring and rehabilitating the residences located at 6538 North Jordan Lane and 6728
9 Ofelia Drive in the City of San Bernardino and hereby authorizes the Interim Executive Director 0
10 the Agency to execute the Agreement on behalf of the Agency together with such technical and
11 conforming changes as may be recommended by the Interim Executive Director of the Agency and
12 approved by the Agency Counsel.
This Resolution shall take effect from and after its date of adoption by this
13 Section 2.
14 Commission.
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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
2008 LOW AND MODERATE INCOME HOUSING FUNDS LOAN AND
GRANT PROPERTY ACQUISITION AGREEMENT BY AND BETWEEN
THE AGENCY AND CALIFORNIA HOUSING FOUNDATION, INC., FOR
THE BENEFIT OF THE DEVELOPMENT ALLY DISABLED ADULTS
7 I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Community
8 Development Commission of the City of San Bernardino at a
, 2008, by the following vote to wit:
meeting
Navs
Abstain
Absent
19
Secretary
20 The foregoing Resolution is hereby approved this
21
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23
day of
,2008.
Patrick J. Morris, Chairperson
Community Development Commission
of the City of San Bernardino
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25 Approved as to Form:
26
ad
By:
27 Agency Counsel
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2008
LOW AND MODERATE INCOME HOUSING FUNDS LOAN AND
GRANT PROPERTY ACQillSITION AGREEMENT
By and Between
Redevelopment Agency of the City of San Bernardino
(Agency)
and
California Housing Foundation, Inc.,
a California non-profit public benefit corporation
(Developer)
4819-2907-8787.1819-2907-8787.1
2008
LOW AND MODERATE INCOME HOUSING FUNDS LOAN AND
GRANT PROPERTY ACQUlSTION AGREEMENT
California Housing Foundation, Inc.,
a California non-profit public benefit corporation
(Acquisition of Jordan and Ofelia Properties)
THIS 2008 LOW AND MODERATE INCOME HOUSING FUNDS LOAN AND GRANT
PROPERTY ACQUISITION AGREEMENT (this "Agreement") is entered into as of November 3,
2008, by and between the Redevelopment Agency of the City of San Bernardino (the "Agency"), a
public body, corporate and politic, and California Housing Foundation, Inc., a California non-profit
public benefit corporation (the "Developer").
The Agency and the Developer hereby covenant and agree as follows:
I. [~100] SUBJECT OF AGREEMENT
A. [SIOI] Recitals
This Agreement is made and entered into with the respect to the following facts:
I. The Developer desires to acquire two (2) properties in the City of San
Bernardino (the "City") located at 6538 North Jordan Lane, San Bernardino, California 92407-1943
(the "Jordan Lane Property") and 6728 North Ofelia Drive, San Bernardino, California 92407-1949
(the "Ofelia Drive Property"). The Agency has determined that the acquisition and operation by or for
the Developer of the Jordan Lane Property and/or of the Ofelia Drive Property contemplated by this
Agreement are consistent with the housing implementation goals of the Agency (hereafter collectively
referred to as the "Project"); and
2. The Project is proposed to be located on certain real property located within the
City as described in Exhibit "A" attached hereto and incorporated herein by this reference; and
3. The Developer intends to acquire the Jordan Lane Property and the Ofelia Drive
Property with proceeds of the Agency Loan and other funds as shall be made available to the
Developer through the Inland Counties Regional Center, Inc. (the "IRC"), with the intent to refinance
one or both of said properties with long-term mortgage financing pursuant to a mortgage loan
commitment to be obtained by the Developer from a commercial lender, and the Project shall be solely
used and operated by or for the Developer as a residential facility for developmentally disabled adults
during the Qualified Residence Period (as defined in Section 324); and
4. The Developer intends to enter into a lease and operating agreement with a
master lessee for both of the Sites, or separate master lessees for each of the Sites, duly qualified by the
IRC to serve as a vendor to the IRC for implementing the types of programs intended to be undertaken
at the Sites for the benefit of the Developer; nothing contained herein shall preclude the Developer
from acting as a vendor to the IRC for the implementation of such programs and operating such
program of the IRC directly at either or both of the Sites; and
4819-2907-87F.18! 9-2907-8787.1
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5. The Agency is desirous of aiding the Developer in the acquisition financing of
the Sites as herein provided; and
6. The Agency's participation in the Project is limited to the dollar amounts as set
forth in this Agreement as the Agency Loan (as defined in Section 403.1) which shall convert to the
Agency Grant (as defined in Section 404); and
7. The Developer is responsible for the improvements and rehabilitation of the
Project at its sole expense, from the funding sources available to the Developer for that purpose and
not from any other funds ofthe Agency nor from the Agency Loan and/or the Agency Grant; and
8. The Agency has determined that the acquisition, improvement and rehabilitation
of the Sites 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. [9102] The Site
The Sites are located in the City as described in the "Legal Descriptions of Sites" which are
attached hereto as Exhibit "A", and are located at 6538 North Jordan Lane, San Bernardino, California
92407-1943 and 6728 North Ofelia Drive, San Bernardino, California 92407-1949 in the City of San
Bernardino, California. .
c. [9103] Parties to this Agreement
1. [9104] 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 of
the Agency. :
2. [9105] The Developer
The Developer is California Housing Foundation, Inc., a California non-profit public
benefit corporation. The principal office of the Developer is located at 1200 California Street, Suite
104, Redlands, California 92374.
The term "Developer" as used in this Agreement includes the Developer and any
assignee or successor to its rights, powers and responsibilities of the Developer.
4819-2907-8787.1819-2907-8787.1
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the Developer
[~106] Prohibition Against Change in Ownership, Management and Control of
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 or powers under this Agreement except as expressly set forth herein.
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, whether 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 the Deed of Trust, Assignment of Leases and
Rents, Security Agreement and Fixture Filing as shall be dated as of the date of recordation (the "Deed
of Trust") and/or the Agency Regulatory Agreement and Declaration of Restrictive Covenants as shall
be dated as of the date of recordation (the "Agency Regulatory Agreement"), any proposed transferee
or assignee must have the prior written consent of the Agency before any such transfer of assignment
can be effectuated by the Developer. This Agreement shall not be terminated by the Agency if a
transferee or assignee of this Agreement has the approval of the Agency during the period of time that
the Developer continues to control not less than fifty-one percent (51%) of the members and directors
of the Developer.
Nothing contained herein shall prohibit the Developer from transferring the Site to
another governmental entity without the prior approval of the Agency, and the Developer shall be
further permitted to lease either or both of the Sites to any management company or operator duly
qualified by the IRC to serve as a vendor to the IRC for implementing the types of programs intended
to be undertaken at the Sites for the benefit of the Developer to further the housing, educational and
work programs for developmentally disabled adults. It is further agreed that nothing contained herein
shall preclude the Developer from acting as a vendor to the IRC for the implementation of such
programs at either or both of the Sites.
II. [~200] ACQUISITION OF THE SITES
A. [~20l] Acquisition of the Sites
The Developer represents that it has entered into real estate purchase contracts to acquire the
Sites, and the Developer shall acquire title to the Sites on or before ten (10) calendar days after receipt
of the proceeds of the Agency Loan allocated as to each Site, subject to reasonable or unexpected
delays in the closing of the escrows (the "Closing") for the acquisition of the Sites. The Developer
shall notifY the Agency in writing as to the anticipated date of closing for the acquisition of each of the
Sites (the "Closing Date") and the date upon which the Agency Loan proceeds shall be deposited to the
applicable escrow.
4819-2907-8787.1819-2907-8787.1
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III. 1~300] DEVELOPMENT OF THE SITES
A. IS30l] Development of the Sites
1. [S302] Scope of Development
The scope of development to be undertaken by the Developer for the Project shall be
consistent with this Agreement and contain requirements, standards and limitations customary for
comparable projects as may be required by the City for the remodeling and rehabilitation of the
Project.
2. [S303] Intentionally Omitted
3. [S304] Cost of Work
The cost of all work of improvements, remodeling and renovation of the Sites as
required by this Agreement shall be borne by the Developer.
4. [S305] Title Insurance
The Developer shall obtain for the benefit of the Agency, and at the sole cost and
expense of the Developer, a lender's policy of title insurance insuring the first lien position of the
Agency Loan as to the Sites in the manner as required by this Agreement. Such policy of title
insurance shall be updated or renewed at the sole cost and expense of the Developer when necessary in
furtherance of the subordination with respect to the Agency Loan to the Subordinating Loans as further
provided in Section 315.5 hereof to thus insure the second lien position of the Agency Loans upon the
Sites at such time as shall be reasonably acceptable to the Agency.
5. [S306] Indemnification; Bodily Injury and Property Damage Insurance
a During the period of construction on the Sites, 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 the Sites 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 prior to 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:
4819-2907-8787.1819-2907-8787.1
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(1) Fire insurance in an amount not less than the fuU 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 therefrom, 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
foUowing amounts: a general aggregate amount of not less than $3,000,000; property damage
insurance not less than the greater of the initial acquisition cost or the then current faire market value;
and not less than $2,000,000 of personal and bodily injury; provided, however, the limitation on the
amount of insurance shaU 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.
(3) [ Reserved]
(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, canceUation, reduction in coverage, or non-renewal except after
notice in writing shaU 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 elected officials, 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. AU 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.
4819-2907-8787.1819-2907-8787.1
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(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 casualt:. 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.
(7) All insurance provided under this Section 306b. shall be for the
benefit of the Developer, 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 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.
(10) 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 and to thereupon declare a default under the Deed of Trust and/or
the Agency Regulatory Agreement.
6. [S307] Nondiscrimination During Construction; Equal Opportunity
The Developer, for itself and its successors and assigns, agrees that in the construction
of the improvements on the Sites provided for in this Agreement:
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.
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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.
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 Sites in
conformity with all applicable laws, including all applicable federal and state labor standards for the
payment of the required prevailing wage rate, if and to the extent applicable.
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 Sites 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 Sites or to prohibit or restrict the renting
for occupancy of residential units to be ;;onstructed on the Sites, nor shall it prohibit granting any
security interests permitted in this Agreement for financing the development of the Sites. The
provisions of this Section 309 shall remain in effect for the duration of the Agency Loan and the
Agency Grant, as applicable.
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.
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.
9. [9310] Security Financing
a. [9311] Encumbrances Permitted
Notwithstanding Section 309, mortgages, deeds of trust, or any other form of
conveyance required for financing or for the subsequent rehabilitation of the Project are permitted to
be recorded against the Sites or the improvements (the "Security Instruments") for the purpose of
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securing funds for the construction, remodeling, repair or maintenance 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 Sites or the improvements, whether by voluntary act of
the Developer or otherwise. Notwithstanding the terms of this Section 311, the Agency agrees to
subordinate to future encumbrances as provided in Section 315.5 below.
Furthermore, it is anticipated that the lRC will be providing to the Developer
certain funds that will be used in furtherance of the acquisition of the Sites (the "Developer Funds")
and the IRC will require the Developer to execute a non-recourse promi3sory note secured by a deed of
trust to be filed for recordation as to the Sites. Any deed of trust filed for recordation against the Sites
in which the IRC is a beneficiary shall be a permitted encumbrance so long assuch deed of trust is in a
lower priority position than the Agency's Deed of Trust.
b. [~312] 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 Sites to any uses, or to construct any
improvements thereon, other than those uses or improvements provided for or authorized by this
Agreement and the Agency Regulatory Agreement.
c. [~313] Notice of Default to Mortgage, Deed of Trust 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 Sites, 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 capabilities
necessary to perform such obligations.
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d. [~3l4] 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 but 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.
(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.
e.
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 Sites 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 Sites and the improvements as authorized herein.
[~3l5] Right of Agency to Cure Mortgage, Deed of Trust or Other
f.
[~3 I 5.5] Subordination to Financing for Improvements after Acquisition
of Sites
The Agency agrees to subordinate the Deed of Trust from time to time after the
acquisition of the Sites by the Developer to the liens of one or more subsequent deeds of trust in
accordance with the terms, covenants and conditions set forth below. The Deed of Trust shall contain
a subordination addendum memorializing the Agency's agreement to subordinate its security interest
as provided in this Section 315.5. The Agency's obligation to subordinate to subsequent deeds of trust
securing loans obtained by the Developer (the "Subordinating Loans") shall be subject to the following
terms and conditions:
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(1) The proceeds of the Subordinating Loans shall be used only for the construction,
remodeling, renovation, reconstruction, maintenance, repair or service of the Project or
the Sites in furtherance of the uses authorized for the Sites as stated in Section 318 of
this Agreement;
(2) The total amount of the Subordinating Loans shall not exceed $200,000;
(3) The Subordinating Loans shall have the following additional terms and conditions:
1. The interest rate shall not exceed 7.5% exclusive of late charges, penalties or fees
payable in case of default;
ll. The Subordinating Loans shall require monthly payments of amortizing principal
and interest;
111. The Subordinating Loans shall have a term of not less than 20 years or more than 30
years;
IV. The maximum loan fees payable on the Subordinating Loans shall not exceed 2% of
the loan amount;
Upon compliance with the terms and conditions set forth above in this Section
315.5, at the written request of the Developer, the Agency agrees to execute a Subordination
Agreement suitable for recording in a form substantially similar as provided in Exhibit "E."
10. [9316] Intentionally Omitted
11. [9317] Use of the Sites
a. [9318] Uses
The Developer covenants and agrees for itself, its successors, its assigns and
every successor in interest that during remodeling and renovation of the Project and thereafter, the
Developer, its successors and assignees shall used and operated by or for the Developer as a residential
facility for developmentally disabled adults for the Qualified Residence Period (as defined in Section
324 hereof and in the Agency Regulatory Agreement). The foregoing covenant shall run with the land.
b. [9319] Obligation to Refrain From Discrimination
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, sublessees or vendees of the Site. The foregoing covenants shall run with
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the land. Notwithstanding the foregoing covenant, the Developer or its successors in interest shall not
be in violation of this covenant by reason of its compliance with the covenant specified in Section 318
of this Agreement.
c. [9320] Form of Nondiscrimination and Nonsegregation Clauses
The Developer shall refrain from restricting the rental, sale or lease of the Sites
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:
(1) In deeds: "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: "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: "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 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 Agency Regulatory
Agreement, attached as Exhibit "B" to this Agreement shall remain in effect for fifty-five (55) years
. following the date of filing for recordation as to each of the Sites to be acquired pursuant to this
Agreement, except that the covenants against discrimination shall remain in perpetuity. The covenants
established in this Agreement shall, without regard to technical classification and designation, be
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binding for the benefit and in favor of the Agency, its successors and assigns, the City and any
successor in interest to the Sites 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. [S322] 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 Sites 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 Sites. 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 Sites resulting from such entry shall be promptly repaired at the sole expense of the public agency
responsible for the entry.
f. [S323] Affordability Restriction and Tenant Selection
All completed and occupied residential dwelling units on the Sites shall, for a
fifty-five (55) year period, be rented at the Affordable Rental Rates to Low Income Households in
accordance with the requirements of Section 33334.2, et seq., of the California Health & Safety Code
and pursuant to this Section.
g. [S324] Definitions
For the purposes of this Agreement, the following definitions shall apply:
"Affordable Rental Rates" (including a utility allowance) may not exceed thirty
percent (30%) of eighty percent (80%) of the Area Median Income for the annual rent, adjusted for
family size appropriate for the unit.
"Area Median Income" means the median family income of a geographic area of
the State, as annually estimated in accordance with the United States Housing Act of 1937.
"Low Income Household" means persons and families whose income does not
exceed eighty percent (80%) of the 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
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determination of a household's status as a Low Income Household shall be made upon the initial
occupancy of a unit by the applicable person or household and shall be subject to annual certification
of continuing compliance by the Developer to the Agency.
"Qualified Residence Period" means the separately calculated period of time
from and after the date of the filing for recordation of the Agency Regulatory Agreement as to each of
the Jordan Street Property and the Ofelia Drive Property through and including fifty-five years
thereafter.
"Qualifying Resident" means each person who is a developmentally disabled
adult residing in a unit at the Sites during the Qualified Residence Period.
"Utility allowance" means that amount required for utilities, which are not paid
for by the Developer.
IV. [~400] FINANCING
A. [~401] Method of Financing Acquisition and Development
1. [~402] Sources of Financing
The Agency and the Developer anticipate that the acqmsltJon of the Sites and
development of the improvements shall be fmanced with a combination of funds, as follows:
Acquisition Financing for the Sites:
Developer's Contribution
Amount of Agency Loan/Grant
Total Estimated Cost
$660,000
$400,000
$1,060,000
2. [~403] Submittal of Financing Documents
The Developer shall have the right to obtain the first mortgage loan in the manner as
provided in Section 315.5 for Subordinating Loans from commercial lenders secured by a first priority
deed of trust upon each Site for the purposes and subject to the limitations as provided in said Section
315.5.
A-I. [~403.1] Agency Loan
The Agency hereby agrees to fund a 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 $200,000 in principal amount for each of the Sites for a total of $400,000 in the
aggregate aIid 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
Sites. Such deposit by the Agency shall be made not more than ten (10) calendar days prior to the
anticipated Closing Date of each escrow for the purchase of each Site by the Developer as further
provided in Section 201. The I;>eveloper and the escrow agent shall jointly inform the Agency in
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writing as to the Closing 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 particular 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 Sites. The
Agency Loan proceeds shall only be used for the acquisition of the Sites 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 relateJ to the improvements.
A-2. [9403.2] Promissory Note and Deed of Trust
The Agency Loan shall be evidenced by a non-recourse promissory note (the
"Promissory Note") substantially in the form as attached hereto as Exhibit "c" which shall be duly
executed and delivered by the Developer and deposited into the escrow for the acquisition of the Sites
and released to the possession ofthe Agency immediately upon funding the acquisition of the Sites and
the recordation of the Deed of Trust substantially in the form as attached hereto as Exhibit "D". The
Deed of Trust shall be duly executed and delivered by the Developer designating the Agency as the
beneficiary thereof and shall be the sole security for the repayment of the Agency Loan as shall be
evidenced by the Promissory Note. Such Deed of Trust shall be duly recorded initially as a first lien
upon the Sites, and upon compliance with the requirements of Section 315.5 with respect to
Subordinating Loans, shall thereafter be recorded as a second lien upon the Sites subject only to
general and special property taxes that have not then been levied by the County of San Bernardino and
a lien in favor of the IRC subordinate to the Deed of Trust and any non-monetary encumbrances on the
Sites which will not materially affect the Developer's ability to use the Sites for the use specified in
Section 318 above (collectively "Permitted Exceptions"). The Agency Regulatory Agreement shall
be recorded as a first lien upon the Sites and prior to the liens of the Subordinating Loans, the Deed of
Trust and the Permitted Exceptions. The Deed of Trust shall not be subject to subordination by the
Agency under any circumstances, except as provided in Section 311 and Section 315.5, or by the
written consent of the Agency at its sole discretion. It is the intent and understanding of the Developer
that the Agency Loan will convert to the Agency Grant as provided in this Agreement. The Agency
Loan shall convert to the Agency Grant upon satisfaction of the compliance with all conditions set
forth in this Agreement, the Promissory Note and the Deed of Trust after twenty (20) years (the
"Maturity Date") from and after the date of the acquisition of each of the Sites provided that there is
then no current default or uncured default then existing as to the Developer under this Agreement. So
long as Developer is not in default under the terms and conditions of this Agreement at any time before
the Maturity Date, the Developer will not be required to make any payments of interest on or principal
of the Agency Loan during any year for which the Agency Loan remains outstanding.
A-3. [9403.3] Terms of Agency Loan
The Agency Loan shall have a term of twenty (20) years from and after the date
of acquisition of each of the Sites. The Agency Loan shall be due and payable as to the unamortized
principal amount, together with interest thereon as calculated in the manner as provided in this Section
403.3, only in the event the Developer is in default under this Agreement at any time prior to the
Maturity Date. Upon any such earlier prepayment of the Agency Loan as a result of any default
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hereunder by the Developer, or upon a prepayment of the Agency Loan at the option of the Developer,
the unamortized principal amount of the applicable portion of the Agency Loan for the Site that is then
subject to any such repayment shall bear interest calculated at six percent (6%) per year, compounded
annually, from the date of the original funding of the applicable portion of the Agency Loan for a
particular Site through such date that the then current unamortized principal amount as is then
outstanding is repaid in whole. For each year that the Agency Loan is outstanding and the Developer
is not then in default during such year with respect to any provision of this Agreement, the Promissory
Note, the Deed of Trust or the Agency Regulatory Agreement, one-twentieth (I/20th) of the original
principal amount of the Agency Loan shall be deemed to have been paid, together with any accrued
interest thereon.
B. [g404] 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 as provided in Section 403.3 prior to or upon the
Maturity Date thereof, the Agency agrees to deem the repayment of the Agency Loan to have occurred
and the Agency Loan shall then become the Agency Grant to the Developer. The Agency Grant shall
be deemed thereafter to be the funding source from the Agency to the Developer during the remainder
of the Qualified Residence Period for which the Developer shall be obligated to comply with the
convents, provisions and restrictions contained in the Agency Regulatory Agreement. The conversion
of the Agency Loan to the Agency Grant shall occur not later than the Maturity Date, and as soon as
practical thereafter the Agency shall cancel the Promissory Note or deem the Promissory Note to be
paid in full and the Agency shall execute such reconveyance documents as may be required to
evidence the satisfaction and release of the Deed of Trust.
I. [g405] Intentionally Omitted
2. [g406] Amount of Agency Grant; Time Limitations
The principal amount of the Agency Grant at the Maturity Date shall be deemed to be
the initial principal amount and any other amounts owed under the Agency Loan resulting from the
compliance by the Developer of the requirements set forth in this Agreement. The Agency shall have
no further authority or obligation to the Developer under this Agreement to disburse in cash any
portion of the Agency Grant after the date that the Agency Loan has been fully amortized or otherwise
paid in full as of the Maturity Date.
3. [g407] Conditions Precedent to Closing of Agency Loan
On or before 12:00 noon on the business day preceding the Closing Date, the Agency
and the Developer shall deliver to the Escrow Holder a fully executed version of the Agency
Regulatory Agreement in recordable form for each Site to be recorded against each Site as a first lien
non-fmancial obligation of the Developer with respect to each of the Sites and subject only to the Deed
of Trust and the Permitted Exceptions specified in Section 403.2 above.
4. [g408] Conditions Precedent to Closing of Agency Loan
Prior to disbursement of any portion of the Agency Loan, the Developer shall deliver to
the Agency the following documents or instruments, if any, all of which shall be in full force and effect
at the time of disbursement of any portion of the Agency Loan:
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a All building permits.
b. A proposed construction contract between the Developer and a licensed
general contractor covering all construction required by this Agreement.
c. Duplicate originals of all insurance policies required as set forth in
Section 306 of this Agreement.
d. Documents relating to the Developer's corporate existence, including:
copies of the 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.
5. [S409] Defaults Following Closing of Agency Loan
In the event that the Developer, on or before the date established in this Agreement for such action,
fails to fulfill its obligations to the Agency under this Agreement, or any agreement or instrument
executed in connection herewith, the Agency, at its option, may declare the Developer to be in default
and require repayment ofthe Agency Loan in whole.
6. [S41O] Repayment of Agency Loan and Agency Grant
a. The Agency Loan and/or 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.
b. In the event the Project is sold or refinanced during the term 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 Loan and/or
the Agency Grant.
c. The term of this Agreement and the Agency Regulatory Agreement shall
be fifty-five (55) years as to each Site from the date of the acquisition of each Site by the Developer.
V. IS500] DEFAULTS, REMEDIES AND TERMINATION
A. [S501] Defaults - General
Subject to the extensions of time set forth in Section 605, failure or delay by either party to
perform any term 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.
The injured party shall give written notice of default to the party in default, specifying the
default complained of by the injured party.
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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 Agency Interim Executive Director
or designee 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 corporate
officer, 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.
D. [9507] Damages; Specific Performance
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 performance of the terms of this
Agreement.
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E. [9508] Remedies and Rights of Termination
1. [9509] Termination by the Developer
The Developer, at its option, may terminate 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. Termination by the Developer shall not terminate the provisions
of the Promissory Note and Deed of Trust or the Agency Regulatory Agreement and all other
covenants contained herein which run with the land.
2. [9510] Termination by Agency
The Agency, at its option, may terminate this Agreement if any of the following occur:
(i) the Developer assigns or attempts to assign this Agreement, or any rights herein, or makes any total
or partial sale, sublease, transfer or conveyance of the whole or any part of the Sites' or the Project,
except as permitted 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.
Notwithstanding the above paragraph, it is agreed and acknowledged that the Developer
shall be permitted to contract or lease the Sites to a third party to provide property management and
professional services to developmentally disabled adults residing at the Sites as an approved vendor of
the IRC as set forth in Section 106 hereof. Such action shall not be considered an assignment in
violation of any of the terms or provisions of this Agreement.
VI. [9600) GENERAL PROVISIONS
A. [9601] Notices, Demands and Communications Between the Parties
Formal 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 601.
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.
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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 cornmencement 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 Agreement may also be extended in writing by the Agency
and the Developer each at their sole and absolute discretion through an approved and duly executed
amendment to this Agreement.
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 and/or the Project
pertinent to the purposes of this Agreement.
G. [9607] 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 herein, or if no time is given, within a
reasonable time.
H. [9608] Minor Modifications to Agreement
The Developer and the Agency acknowledge and recognize that certain minor modifications of
this Agreement may be necessary to accommodate unforeseen circumstances for the Project as may be
reasonably required by the Developer. The Agency Interim Executive Director, with the advice of
Agency counsel, shall be the Agency officer authorized to act for the Agency pursuant to this Section
608.
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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 conforming
appropriate written modifications of this Agreement (and any exhibit attached hereto) for the Project
and to close the escrow for the acquisition of the Sites 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 conforming 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 conforming modification of this Agreement shall
not be deemed to be a default hereunder. Nothing contained herein shall prevent the Interim Executive
Director from seeking formal approval of all such amendments or n.odifications from the governing
body of the Agency at a duly called and held public meeting.
VII. [~7001 ENTIRE AGREEMENT, WAIVERS AND AMENDMENTS
This Agreement shall be executed in three (3) duplicate originals, each of which is deemed to
be an original. This Agreement includes twenty-one (21) pages and five (5) 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 writing 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.
VIII. [~8001 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. [~9001 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.
1//
/1/
1//
1//
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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:
Emil A. Marzullo, Interim Executive Director
Approved as to Form and Legal Content:
By:
):f'lil
Agency Counsel
DEVELOPER
California Housing Foundation, Inc.,
a California nonprofit public benefit corporation
Date:
By:
Title:
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EXHIBIT "A"
LEGAL DESCRIPTIONS OF SITE
I) 6728 NORTH OFELIA DRIVE, SAN BERNARDINO, CALIFORNIA 92407
LOT 32 OF TRACT NO. 16792, IN THE CITY OF SAN BERNARDINO, COUNTY
OF SAN BERNARDINO, STATE OF CALIFORNIA, AS SHOWN BY MAP ON FILE
IN BOOK 3 I 5 PAGES 43 THROUGH 45 INCLUSIVE OF MAPS, IN THE OFFICE OF
THE COUNTY RECORDER OF SAID COUNTY.
APN: 0261-701-15-0000
2) 6538 NORTH JORDAN LANE, SAN BERNARDINO, CALIFORNIA 92407
LOT 96 OF TRACT NO. 16443, IN THE CITY OF SAN BERNARDINO, COUNTY
OF SAN BERNARDINO, STATE OF CALIFORNIA, AS SHOWN BY MAP ON FILE
IN BOOK 300 PAGE 67, IN THE OFFICE OF THE COUNTY RECORDER OF SAID
COUNTY.
APN: 0261-671-48-0000
4819-2907-8787.1819-2907-8787.1
RECORDING REQUESTED BY )
AND WHEN RECORDED MAIL TO: )
)
Redevelopment A_~ncy )
of the City of San Bernardino )
Attn.: Interim Executive Director )
201 North "E" Street, Suite 301 )
San Bernardino, California 92401 )
)
)
Recording Fee Exempt Pursuant to Government Code Section 6103
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
AGENCY REGULATORY AGREEMENT
AND
DECLARATION OF RESTRICTIVE COVENANTS
THIS AGENCY REGULATORY AGREEMENT AND DECLARATION OF RESTRICTIVE
COVENANTS (this "Agency Regulatory Agreement") is made and entered into as of this _ day of
November, 2008, by and between the Redevelopment Agency of the City of San Bernardino, a public
body, corporate and politic (the "Agency") and the California Housing Foundation, Inc., a California
non-profit public benefit corporation (the "Developer").
--RECITALS--
A. The Agency and the Developer have entered into that certain 2008 Low and Moderate
Income Housing Funds Loan and Grant Property Acquisition Agreement, dated as of November 3,
2008 (the "Agreement"). A copy of the Agreement is on file with the Agency Secretary.
B.. Pursuant to the terms of the Agreement, the Agency has agreed to provide a loan and a
grant to the Developer to enable the Developer to purchase, to improve and to rehabilitate the "Project"
(as defined in the Agreement), subject to certain conditions provided for in the Agreement.
C. In consideration for the Agreement, the Developer has agreed to lease or rent the
Bedrooms at the Project to Qualified Residents at the Affordable Rental Rate, as these terms are
defined below for the term of this Agency Regulatory Agreement and to further agree to observe all
the terms and conditions set forth below.
D. The Agency has further agreed to provide the loan and the grant to the Developer on the
condition that the Project 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 Project will be used and operated in accordance with these
conditions and restrictions, the Agency, and the Developer wish to enter into this Agency Regulatory
Agreement for themselves and their successors and assigns.
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THEREFORE THE REDEVELOPMENT AGENCY OF THE CITY OF SAN
,
BERNARDINO, ITS SUCCESSORS AND ASSIGNS, AND THE DEVELOPER, ITS SUCCESSORS
AND ASSIGNS, HEREBY COVENANT AND AGREE AS FOLLOWS:
ARTICLE 1
DEFINITIONS
1.1 Definitions. When used in this Agency Regulatory Agreement, certain terms and
phrases as denoted by an initially capitalized letter shall have the same meaning as found in the
Agreement 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 this
Agency Regulatory Agreement as ascribed below:
a. "Adjusted Income" shall mean the total anticipated annual income of the person which
occupies (or is proposed to occupy) a Bedroom 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.
b. "Affordable Rental Rates" (including a utility allowance) shall mean and shall not
exceed thirty percent (30%) of eighty percent (80%) of the Area Median Income for the
annual rent, adjusted for family size appropriate for the Bedroom.
c. "Agency Regulatory Agreement" shall mean this Agency Regulatory Agreement and
Declaration of Restrictive Covenants dated as of , 2008, by and between the
Developer and the Agency. A copy of the Agency Regulatory Agreement is on file
with the Agency Secretary.
d. "Area Median Income" shall mean the median family income of a geographic area of
the state, as annually estimated in accordance with the United States Housing Act of
1937.
e. "Bedroom" shall mean one (I) bedroom at the Site. Each Bedroom at the Site shall be
occupied by a Qualified Resident or, if vacant, shall be offered by or for the Developer
to a Qualified Resident at the Affordable Rental Rates.
f. "Certificate of Occupancy Date" shall mean the date of issuance by the City of the
initial Certificate of Occupancy for the Project.
g. "City" shall mean the City of San Bernardino, California
h. "Closing Date" shall mean the date of recordation of this Agency Regulatory
Agreement.
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1. "Developer" shall mean the California Housing Foundation, Inc., a California non-
profit public benefit corporation, and its permitted successors and permitted assigns.
J. "Laws" shall mean all federal, state, municipal and local laws, statutes, codes, rules,
regulations, ordinances and orders, now or hereafter existing, as amended from time to
time.
k. "Low Income" shall mean the annual income for a low income person or household
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
I. "Low Income Household" shall mean a person or household whose annual income does
not exceed the Very Low Income.
m. "Management Agent" shall mean the experienced management agent selected by the
Developer for the management of the Project as provided in Section 5.2 of this Agency
Regulatory Agreement.
n. "QualifYing Resident" shall mean a person who is a developmentally disabled adult and
who is a person of Low Income.
o. "QualifYing Residence Period" shall mean the period of fifty-five (55) years, beginning
on the date of recordation of this Agency Regulatory Agreement and ending on the
fifty-fifth (55th) anniversary following such date. During the QualifYing Residence
Period the Developer shall operate and maintain the Site, or must cause the Site to be
operated and maintained, solely as a residential facility for developmentally disabled
adults in compliance with all Laws.
p. [Reserved - No Text]
q. "Rent" shall mean the total of each monthly payment by the Qualified Resident of a
Bedroom to the Developer for the following: use and occupancy of the Bedroom and
land and associated facilities, including parking, if any; any separately charged fees or
service charges assessed by the Developer which are required of all Qualified
Residents, other than security deposits; the cost of an adequate level of service for
utilities paid by the Qualified Resident, including garbage collection, sewer, common
area, water, electricity, gas and other heating, and refrigeration costs, but not telephone
service; any other interest, taxes, fees or charges for use of the land or associated
facilities and assessed by a public or private entity other than the Developer, and paid
by the Qualified Resident.
r. "Site" shall mean the real property described In Exhibit "A" attached hereto and
incorporated herein by this reference.
s. "Term" shall mean the period of fifty-five (55) years, beginning on the date of
recordation of the Agency Regulatory Agreement and ending on the fifty-fifth (55th)
anniversary following such date.
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ARTICLE 2
QUALIFIED RESIDENT BEDROOMS
-- RENT AND OCCUPANCY AFFORDABILITY COVENANTS--
2.1 Occupancy Requirement. During the Term of this Agreement, each of the Bedrooms
shall be rented or occupied by, or if vacant, available for rental and occupancy by Low Income
Qualified Residents.
2.2 Allowable Rent for Bedrooms.
a. Subject to Section 2.3 below, the Rent charged the occupants of the Bedrooms shall not
exceed thirty percent (30%) of eighty percent (80%) of the Area Median Income for annual rent,
adjusted for family size appropriate for the Bedrooms.
b. In calculating the allowable Rent for each Bedroom, the household size shall be
assumed to be one (I) person per Bedroom.
c. At least one hundred eighty (180) calendar days prior to increasing Rent on any
Bedroom, the Developer shall submit to the Agency for review and approval a written request for such
increase. A Qualified Resident occupying the Bedroom shall be given at least ninety (90) calendar
days' written notice prior to any increase in Rent.
Rent for a Bedroom 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 in Section
2.2.a., above.
2.3 Increased Income of a Oualified Resident Occupancy of a Bedroom.
a. In the event, upon recertification of an occupant's income for a Bedroom, the Developer
discovers that a Low Income Household no longer qualifies as a Low Income Household, then such
household shall not be required to vacate the Project and the Rent chargeable to that household shall be
increased to an amount of Rent which is the lesser amount of (i) thirty percent (30%) of that
household's actual montWy income; or (ii) the amount payable by the tenant under State or local law.
However, when the Bedroom is vacated by that household, the Bedroom shall be rented to a Low
Income Household at the Rent level allowed in Section 2.2 for a Bedroom as of the date of
commencement of such a new occupancy. Moreover, a Bedroom occupied by a Low Income
Household shall be deemed, upon the termination of such Low Income Household's tenancy to be
continuously occupied by a Low Income Household until that Bedroom is reoccupied.
b. If the Project is subject to state or federal rules governing low income housing tax
credits, the provisions of those rules regarding continued occupancy by, and Rent charged to,
households whose incomes exceed the eligible income limitation shall apply in place of the provisions
set forth in Section 2.3.a., above.
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2.4 Lease Provisions.
a. The Developer shall include in leases or rental agreements for all Bedrooms provisions
which authorize the Management Agent 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 Low
Income Household and for all Bedrooms any misrepresentation relating to the Qualified Resident
qualification. Each lease or rental agreement for a Bedroom 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 Very Low Income Household such household's
Rent may be subject to increase 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 Bedroom.
b. The leases for Bedrooms shall provide that if the Project is subject to state or federal
rules goveming low income housing tax credits, the provisions of those rules regarding continued
occupancy by, and increases in Rent for households whose incomes exceed the eligible income
limitation shall apply in place of the provisions set forth in Section 2.4.a, above.
ARTICLE 3
OPERATION AND MAINTENANCE OF THE PROJECT
3.1 Use as Oualified Resident Rental Housing. The Project shall be operated only as rental
housing for Qualified Residents. No part of the Project shall be operated as transient housing.
3.2 Compliance with the Agreement. The Developer shall comply with all the terms and
provisions of the Agreement.
3.3 [Reserved. No Text]
3.4 Taxes and Assessments. The Developer shall pay all real and personal property taxes,
assessments and charges and all franchise, 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
[mal determination of the proceeding or contest, shall immediately payor discharge any decision or
judgment rendered against it, together with all costs, charges and interest. Nothing herein shall
prohibit the Developer from applying for or obtaining any exemption, abatement or reduction from real
estate taxes as allowed by law.
3.5 Nondiscrimination. All of the Bedrooms shall be available for occupancy on a
continuous basis to Qualified Residents of the general public (who are also income eligible with
respect to the Bedrooms). The Developer shall not give preference to any particular class or group of
persons in renting the Bedrooms. There shall be no discrimination against or segregation of any
person or group of persons, on account of race, color, creed, religion, sex, sexual orientation, age,
marital status, national origin, or ancestry in the leasing, subleasing, transferring, use, occupancy,
tenure, or enjoyment of any Bedroom. Neither the Developer nor any person claiming under or
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through the Developer, shall 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,
sublessees, subtenants, or vendees of any Bedroom or in connection with the employment of persons
for the operation and management of any Bedroom. All deeds, leases or contracts made or entered into
by owner as to the Bedrooms or the Site or portion thereof, shall contain covenants prohibiting
discrimination as prescribed herein. The Developer shall include a statement in all advertisements,
notices and signs for the availability of Bedrooms for rent to the effect that the owner is an Equal
Housing Opportunity Provider.
ARTICLE 4
DISABILITY AND INCOME
CERTIFICATION AND REPORTING
4.1 Adult Disabilitv and Income Certification.
a. The Developer shall obtain and complete prior to initial occupancy, and thereafter
maintain on file, income certifications from each Qualified Resident renting any of the Bedrooms. The
Developer shall make a good faith effort to verifY that the income and adult disability provided by an
applicant or occupying Qualified Resident in an income certification is accurate by taking one or more
of the following steps as a part of the verification process: (I) obtain an income tax return for the most
recent tax year, (2) conduct a credit agency or similar search, (3) obtain an income verification form
from the applicant's current employer, (4) obtain an income verification form from the United States
Social Security Administration and/or from the California Department of Social Services if the
applicant receives assistance from either of such agencies, (5) if the applicant is unemployed and has
no such tax return, obtain another form of independent verification, or (6) a letter from the physician of
the applicant or Qualified Resident describing in detail the current disability of the Qualified Resident,
in a form reasonably satisfactory to the Agency. On the anniversary of the occupancy of such
Bedroom, the Developer shall recertifY the household income of the Qualified Resident occupying the
Bedroom. Copies of all disability and tenant income certifications shall be available to the Agency
upon request.
b. The Developer shall verifY, prior to the occupancy of each Bedroom that the applicant
satisfies the requirements of a Qualified Resident as provided in the Agreement. Thereafter, the
Developer shall annually verifY that the Qualified Resident retains its qualification as a Qualified
Resident.
4.2 Annual Bedroom Rental Affordabilitv Report to Agencv. Commencing on the June 30
next following the Certificate of Occupancy Date and on each June 30 thereafter during the Term of
the Agency Regulatory Agreement, the Developer shall submit a report to the Agency, in a form
approved by the Agency. The annual report shall include for each Bedroom covered by this Agency
Regulatory Agreement, the Rent and the income of the Qualified Resident occupying the Bedroom.
The report shall also state the date the tenancy commenced for each Bedroom and such other
information as the Agency may be required by law to obtain; provided, however, that the Agency shall
take reasonable steps to maintain the confidential nature of the information contained therein relating
to any Bedroom.
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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 to examine and make copies of all
books, records or other documents of Developer, which pertain to any Bedroom; provided, however,
that the Agency shall take reasonable steps to maintain the confidential nature of the information
contained therein.
4.4 Records. The Developer shall maintain complete, accurate and current records
pertaining to the Bedrooms, and shall permit any duly authorized representative of the Agency (during
business hours and upon not less than seventy-two (72) hours notice) to inspect records, including
records pertaining to the income of the Qualified Resident; provided, however, that the Agency shall
take reasonable steps to maintain the confidential nature of the information contained therein relating
to the income of the Qualified Resident.
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, verification of income for the
Bedrooms, evictions, collection of rents and deposits, maintenance, landscaping, routine and
extraordinary repairs, replacement of capital items, and security. The Agency shall have no
responsibility for the management or operation of the Site or the Project.
5.2 Management Agent. The Project shall at all times be managed by an experienced,
qualified Management Agent reasonably acceptable to the Agency, with demonstrated ability to
operate the Site as a residential facility for Qualified Residents similar to the Project in a manner that
will provide decent, safe, and sanitary housing. For 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. If the Management Agent is an entity or person other than the Developer, its
employees or an entity 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 fmancial condition of any proposed
Management Agent as reasonably requested by the Agency. If the proposed Management Agent meets
the standard for an experienced qualified Management Agent as 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 within thirty (30) calendar days, which disapproval
shall state with reasonable specificity the basis for disapproval, the proposed Management Agent shall
be deemed approved. The Developer is hereby approved by the Agency as the Management Agent for
the Project.
5.3. Maintenance of the Site and the Project.
a. The Developer shall maintain the Site and the Project in good repair and a neat, clean
and orderly condition, ordinary wear and tear excepted. In the event that, at any 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
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Deficiency"), then the Agency shall notify the Developer in writing of the Maintenance Deficiency and
give the Developer sixty (60) calendar 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 commence to cure the
Maintenance Deficiency within the time allowed, the Agency may conduct a public hearing following
transmittal of written notice thereof to the Developer ten (10) calendar days prior to the scheduled date
of such public hearing in order to verify whether a Maintenance Deficiency exists and whether 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 the general maintenance 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
abatement 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 within thirty (30) calendar 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 provided in Section 5.3c.
b. Graffiti which is visible from any public right-of-way adjacent or contiguous to the Site
shall be removed by the Developer in the following manner: (I) from any exterior surface of a
structure or improvement on the Site by painting over the evidence of such vandalism with a paint
which has been color-matched to the surface on which the paint is applied or (2) from all other surfaces
graffiti may be removed with solvents, detergents or water as appropriate. In the event that graffiti is
placed on the Site and such graffiti is visible from an adjacent or contiguous public right-of-way and,
thereafter such graffiti is not removed ;vjthin seventy-two (72) hours following the time of its
application, then in such event and without notice to the Developer, the Agency shall have the right to
enter the property and remove the graffiti. Notwithstanding any provision of Section 5.3 to the
contrary, any sum expended by the Agency for the removal of graffiti from the Site as authorized by
this Section 5.b, shall become a lien on the Site. If the amount of the lien is not paid within thirty (30)
calendar days after written demand for payment by the Agency to the Developer, the Agency 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 expressly include the power to establish and enforce a lien or other
encumbrance against the Site, or any portion thereof, in the manner provided under Civil Code
Sections 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 costs 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 Agency Regulatory
Agreement and shall be enforceable by the Agency, and its successors and assigns. Nothing in the
foregoing provisions of this Section 5.3 shall be deemed to preclude the Developer 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 lien as may arise under this Section 5.3
shall interfere with or be superior to the security interest of any mortgage secured by the Site.
5.4 Insurance Coverage. The Developer, at its sole cost and expense, shall cause to have in
full force and effect during the term of this Agency Regulatory Agreement minimum insurance
coverage as follows:
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(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 diligently repair or restore the
Site and the Project consistent with the original plans and specifications 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. Developer shall ensure that there is at all times during the
term of this Agency Regulatory Agreement sufficient insurance coverage to adequately
fund any repair or restoration of the site.
(ii) A policy of comprehensive general liability insurance written on a per occurrence basis
in an amount not less than either (i) an aggregate single limit of THREE MILLION
DOLLARS ($3,000,000.00) or (ii) bodily injury limits of ONE MILLION DOLLARS
($1,000,000.00) per occurrence and property damage limits of ONE MILLION
DOLLARS ($1,000,000.00) per occurrence.
(iii) A policy of workers' compensation insurance in such amount 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, the Agency, and the City against any loss, claim or
damage arising from any injuries or occupational diseases occurring to any worker
employed by or any persons retained by the Developer in the course of carrying out the
activities in this Agency Regulatory Agreement.
All of the above policies of insurance shall be primary insurance and shall name the City and
the Agency and their elected officials, officers, agents and employees as additional insureds. The
insurer shall waive all rights of subrogation and contribution it may have against the City and the
Agency and their elected officials, officers, agents and employees and their respective insurers. All of
said policies of insurance shall provide that said insurance may not be amended or canceled without
providing thirty (30) days prior written notice by registered mail to Agency. In the event any of said
policies of insurance are canceled, the Developer shall, prior to the cancellation date, submit new
evidence of insurance in conformance with this Section 5.4 to the Interim Executive Director. No
operation of the Project shall commence until the Developer has provided Agency with certificates of
insurance or appropriate insurance binders evidencing the above insurance coverages, and said
certificates of insurance or binders are approved by Agency.
The policies of insurance required by this Agreement shall be satisfactory 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 an equivalent rating in The Key Rating Guide or in the
Federal Register unless such requirements are modified or waived by the Interim Executive Director of
the Agency due to unique circumstances.
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 to any
persons or property resulting from the Developer's activities or the activities of any person or persons
for which the Developer is otherwise responsible.
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At any time during the Term of this Agreement, the Developer, at it sole cost and expense, shall
increase the insurance amounts, coverages and protections, and shall obtain and maintain all additional
insurance policies, as reasonably requested by the Agency.
ARTICLE 6
MISCELLANEOUS
6.1 Term. The provisions of this Agency Regulatory Agreement 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 voluntarily or involuntarily, by operation of law or
otherwise, with or without the approval of the Agency, except as expressly released by the Agency.
6.2 [Reserved. No Text]
6.3 [Reserved. No Text]
6.4 Non-Liability of Officials. Emolovees and Agents. The Agency shall not be personally
liable to the Developer for any obligation created under the terms of this Agency Regulatory
Agreement except in the case of actual fraud or willful misconduct by such person.
6.5 Covenants to Run With the Land. 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 the land, and shall bind all successors in title to the Site and/or
the Project; provided, however, that on the expiration of the Term of this Agency Regulatory
Agreement said covenants and restrictions shall expire.
6.6 Enforcement bv the Agencv. If the Developer fails to perform any obligation under this
Agency Regulatory Agreement, and fails to cure the default within thirty (30) calendar days after the
Agency has notified the Developer in writing of the default or, if the default cannot be cured within
thirty (30) calendar days, fails to commence to cure within thirty (30) calendar days and thereafter
diligently pursue such cure, the Agency shall have the right to enforce this Agency Regulatory
Agreement by any or all of the following actions, or any other remedy provided by law:
a. Action to Comnel Performance or for Damages. The Agency may bring an action at
law or in equity to compel the performance of the obligations of the Developer under
this Agency Regulatory Agreement, and/or for damages.
b. Enforce Liens. The Agency may enforce and execute upon the lien rights of the
Agency as conferred under Section 5.3 of this Agency Regulatory Agreement.
6.7 Attomevs' Fees and Costs. In any action brought to enforce this Agency Regulatory
Agreement, the prevailing party shall be entitled to all costs and expenses of suit, including reasonable
attorneys' fees and court costs. This Section shall be interpreted in accordance with Califomia Civil
Code Section 1717 and judicial decisions interpreting that statute.
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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 hereto or their successors in title, and duly recorded in the real
property records of the County of San Bernardino, California.
6.11 Notice. All notices given or certificates delivered under this Agency Regulatory
Agreement shall be deemed received on the delivery or refusal date shown on the delivery receipt, if:
(i) personally delivered by a commercial service which furnishes signed receipts of delivery or (ii)
mailed 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 different addresses
to which subsequent notices, certificates or communications shall be sent. The addresses for the
Developer and for the Agency are as follows:
To the Developer:
California Housing Foundation, Inc.
1200 California Street, Suite 104
Redlands, California 92374
Attn.: Executive Director
Telephone: (909) 793-9800
Fax: (909) 793-7843
To the Agency:
Redevelopment Agency of the City of San Bernardino
20 I North "E" Street, Suite 30 I
San Bernardino, California 92401
Attn.: Interim Executive Director
Telephone: (909) 663-1044
Fax: (909) 663-2294
with copy to:
Lewis Brisbois Bisgaard & Smith LLP
650 East Hospitality Lane, Suite 600
San Bernardino, California 92408
Attn.: Timothy J. Sabo
Telephone: (909) 387-1130
Fax: (909) 387-1138
6.12 Severability. If any provision of this Agency Regulatory Agreement shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the remaining portions of this
Agency Regulatory Agreement shall not in any way be affected or impaired thereby.
6.13 rReserved. No Text]
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6.14 Relationship of Parties. The relationship between the Agency and the Developer during
the term of this Agency Regulatory Agreement shall not be construed as a joint venture, equity
venture, or partnership. The Agency does not undertake or assume any responsibility or duty to the
Developer or any third party with respect to the ownership of the Site or the operation of the Project or
the actions of the Developer. The Developer shall have no authority to act as an agent of the Agency
or to bind the Agency to any obligation.
6.15 Waiver. Any waiver by the Agency 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 the 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 consent to future
waivers.
6.16 Other Agreements. 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 Agreement. The Developer shall not enter into any agreements that are inconsistent with
the terms of this Agency Regulatory Agreement without the express approval by the Agency.
III
III
III
III
III
III
III
III
III
III
III
III
III
4831.7078.9379.1831.7078.9379.1 12
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IN WIlNESS 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.
AGENCY
Redevelopment Agency of the City of San
Bernardino, a public body, corporate and politic
Date:
By:
Emil A. Marzullo, Interim Executive Director
Approved as to Form and Legal Content:
By:
Agency Counsel
DEVELOPER
California Housing Foundation, Inc.,
a California non-profit public benefit corporation
Date:
By:
By:
Name:
Title:
[ALL OFFICER/PRINCIPAL SIGNATURES TO BE NOTARIZED]
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EXHIBIT "A"
LEGAL DESCRIPTION OF THE SITE
1) 6728 NORTH OFELIA DRIVE, SAN BERNARDINO, CALIFORNIA 92407
LOT 32 OF TRACT NO. 16792, IN THE CITY OF SAN BERNARDINO, COUNTY OF SAN
BERNARDINO, STATE OF CALIFORNIA, AS SHOWN BY MAP ON FILE IN BOOK 315
PAGES 43 THROUGH 45 INCLUSIVE OF MAPS, IN THE OFFICE OF THE COUNTY
RECORDER OF SAID COUNTY.
APN: 0261-701-15-0000
2) 6538 NORTH JORDAN LANE, SAN BERNARDINO, CALIFORNIA 92407
LOT 96 OF TRACT NO. 16443, IN THE CITY OF SAN BERNARDINO, COUNTY OF SAN
BERNARDINO, STATE OF CALIFORNIA, AS SHOWN BY MAP ON FILE IN BOOK 300
PAGE 67, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
APN: 0261-671-48-0000
4831-7078-9379.1831-7078-9379.1
14
EXHBIIT"C"
PROMISSORY NOTE
4819-2907-8787.1819-2907-8787.1
PROMISSORY NOTE
Borrower:
Lender:
California Housing Foundation, Inc.
1200 California Street, Suite 104
Redlands, California 92374
Redevelopment Agency of the
City of San Bernardino
Attention: Interim Executive Director
20 I North "E" Street, Suite 30 I
San Bernardino, California 92401
FAX: (909) 663-2294
Principal Amount:
$200,000.00
Date of Promissory Note:
November _, 2008
Interest Rate:
6% per annum compounded annually
Date of Disbursement of Agency Loan:
Property Address:
APN:
Maturity Date of Promissory Note:
Twenty (20) years after Date of Promissory Note.
PROMISE TO PAY. The Undersigned, California Housing Foundation, Inc., a California
nonprofit public benefit corporation (the "Borrower"), promises to pay to the Redevelopment
Agency of the City of San Bernardino, a public body, corporate and politic (the "Lender"), or its
order, in lawful money of the United States of America, the principal amount of Two Hundred
Thousand Dollars ($200,000.00), or so much as may be outstanding, together with interest on the
unpaid outstanding principal balance on the Maturity Date, pursuant to this Promissory Note
(this "Note") until repayment in whole of the outstanding principal balance and all accrued and
unpaid ..interest hereunder. This loan (the "Loan") is made by the Lender to the Borrower in
accordance with and pursuant to the 2008 Low and Moderate Income Housing Funds Loan and
Grant Property Acquisition Agreement, dated as of November 3, 2008 (the "Agreement"). The
Loan is evidenced by this Note and is secured by the the Deed of Trust, Assignment of Leases
and Rents, Security Agreement and Fixture Filing, of even date herewith, by and between the
Borrower, as trustor, and the Lender, as beneficiary (the "Deed of Trust"), encumbering the Trust
Estate (as defined in the Deed of Trust). The Deed of Trust encumbers the Trust Estate and the
Agency Regulatory Agreement and Declaration of Restrictive Covenants (the "Agency
Regulatory Agreement") encumbers the Site (as defined therein). The Deed of Trust and the
Agency Regulatory Agreement are recorded in the Official Records of the County of San
Bernardino, State of California.
4840-2636-1859.1840-2636-1859.14840-2636-1859. 1
I
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INDEBTEDNESS. lbis Note evidences the indebtedness of the Borrower 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 Note.
INTEREST RATE. Interest shall accrue on the outstanding principal balance of this Note
commencing on the date of this Note at the rate of six percent (6%) per annum compounded
annually, calculated on the unpaid principal balance of this Loan for any outstanding principal
amounts hereof that are either (i) not paid on or before each anniversary date of this Note, or (ii)
not deemed to be paid pursuant to Section 403.3 of the Agreement based upon no defaults having
then occurred under this Note, the Deed of Trust, the Agency Regulatory Agreement and the
Agreement, or (iii) upon the Maturity Date hereof and with interest in all such instances, as
applicable. If a default occurs under this Note, interest shall accrue at the rate of six percent
(6%) per annum from the date of the default until all outstanding principal of and accrued and
unpaid interest on this Note has been paid in whole.
PAYMENT. Interest-only payments shall be due and payable annually in arrears commencing
on the first anniversary date of the term of the Note and annually thereafter from the Borrower to
the Lender for the term of this Note. For each year that this Note is outstanding and the
Borrower is not then in default during such year with respect to any provision of this Note, the
Deed of Trust, the Agency Regulatory Agreement or the Agreement, one-twentieth (I/20th) of
the original principal amount of this Note shall be deemed to have been paid, together with any
accrued interest thereon. On the maturity date of this Note, all outstanding principal and accrued
and unpaid interest, if any, shall be due and payable by the Borrower to the Lender. Interest
shall be calculated on a daily basis on a 365/366 actual calendar days basis from the date of the
Note until paid thereafter in whole or in part as to any partial principal payment, calculated on
the unpaid principal balance of this Loan for any principal amounts thereof that are then required
to be paid on or before the Maturity Date hereof with interest to thereupon be calculated on such
unpaid principal amount, and accrued interest, from the date of the Note as further provided in
the Agreement. The Borrower shall make all payments of interest and principal to the Lender at
the address of the Lender: 201 North "E" Street, Suite 301, San Bernardino, California 92401, 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.
FORGIVENESS OF PRINCIPAL AND INTEREST. Provided the Borrower is not in default
under this Note, the Deed of Trust, the Agency Regulatory Agreement or the Agreement, on the
first anniversary interest-only payment due date and on every annual interest-only payment due
date thereafter for the term of this Loan, the accrued and unpaid interest for that the applicable
preceding year shall be deemed to have been paid by the Borrower and shall be forgiven by the
Lender and the outstanding principal balance of this Loan shall be discharged and reduced by
one twentieth (I/20th) of the then original principal balance of this Note (i.e., assuming that the
Borrower is not in default under this Note, the Deed of Trust, the Agency Regulatory Agreement
or the Agreement). Provided that the Borrower has not been in default at any time under this
Note, the Deed of Trust, the Agency Regulatory Agreement or the Agreement for the term of this
Note, this Loan shall be forgiven by the Lender on the Maturity Date and the Borrower shall
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have no further obligation to pay any accrued and unpaid interest or any then outstanding
principal amount; provided, however, any amounts, plus accrued interest thereon that remain due
and payable by the Borrower as of the Maturity Date due to a prior default by the Borrower
pursuant to either this Note, the Deed of Trust, the Agency Regulatory Agreement or the
Agreement, the Borrower shall be required to pay the remaining principal balance of this Note,
plus interest thereon, as of the Maturity Date.
LATE CHARGE. If an installment payment is ten (10) calendar days or more late, the
Borrower shall also be charged $250.00 as a late charge for each such late payment of an
installment.
DEFAULT. The Borrower shall be in default under the terms of this Note if any of the defaults
or events of default as specified in this Note, the Deed of Trust, the Agency Regulatory
Agreement or the Agreement have occurred.
If any default is curable and if the Borrower has not been given a notice of a breach of the same
provision of this 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 (IS) calendar days; or
(ii) if the cure requires more than fifteen (IS) calendar days, immediately
initiates steps which the Lender deems in its sole discretion to be sufficient
to cure the default, and thereafter the Borrower continues and cures such
default within the time expressly authorized in writing by the Lender.
RIGHTSIREMEDIES OF THE LENDERlHOLDER. 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
Note and all accrued and 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 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
expenses 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 the Borrower to
the 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 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
Note, the Superior Court of the State of California in and for the County of San Bernardino shall
have jurisdiction of such lawsuit. This Note shall be governed by and construed in accordance
with the laws of the State of California.
4840-2636-1859.1840-2636-1859.14840-2636-1859.1 3
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Notwithstanding any other provision contained in this Note, it is agreed that the execution of this
Note is not intended to impose personal liability on any corporate officer or agent of the
Borrower for payment of the indebtedness evidenced hereby. In the event of a default, and
provided that th" Borrower or any corporate officer or agent thereof is not complicit in any act,
whether authorized or ultra vires, of commission or omission, that caused, directly or indirectly,
the occurrence of the default, the Lender under this Note shall look solely to the property
described in the Deed of Trust in satisfaction of the indebtedness evidenced hereby, and will not
seek or obtain any deficiency or personal judgment against any corporate officer or agent of the
Borrower, except such judgment or decree as may be necessary to foreclose and bar its interest in
the Trust Estate and all other mortgaged, pledged, conveyed or assigned to secure payment of
this Note, and except as set out in the Deed of Trust given to secure this indebtedness.
COLLATERAL. The Borrower acknowledges this Note is secured by a Deed of Trust of even
date herewith. The Deed of Trust affects Assessor's Parcel Number located at
, San Bernardino, California 92407 (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, and/or of the Personal Property, or
any interest in the Real Property. A "sale, transfer or
encumbrance" means the conveyance of the Real Property and/or
of the Personal 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 Real 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 Real
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 Note without any forfeiture, diminution or loss of such rights or remedies.
The Borrower waives any applicable statute of limitations, presentment, demand for payment,
offsets, claims, protest and notice of dishonor. Upon any change in the terms of this Note, and
unless otherwise expressly stated in writing, the Borrower shall be released from liability
hereunder. All such parties agree that the Lender/Holder may renew or extend (repeatedly and
for any length of time) this Note, or release any collateral, and take any other action deemed
necessary by the Lender/Holder in its sole discretion without the consent of or notice to anyone.
/II
4840-2636-1859.1840-2636-1859.14840-2636-1859.1 4
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PRIOR TO SIGNING THIS NOTE, THE BORROWER HAS READ AND UNDERSTANDS
ALL OF ITS PROVISIONS. THE BORROWER AGREES TO THE TERMS OF THIS NOTE
AND ACKNOWLEDGES RECEIPT OF A COPY HEREOF.
BORROWER
California Housing Foundation, Inc.,
a California non-profit public benefit corporation
Date:
By:
Name:
Title:
4840-2636-1859.1840-2636-1859.14840-2636-1859.1 5
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EXHIBIT "D"
DEED OF TRUST
4819-2907-8787.1819-2907-8787.1
RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:
Redevelopment Agency
of the City of San Bernardino
Attn.: Interim Executive Director
20 I North "E" Street, Suite 30 I
San Bernardino, CA 92401
(Space Above Line for Recorder's Use Only)
Recording Fee Exempt Pursuant to Government Code Section 6103
DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS, SECURITY
AGREEMENT AND FIXTURE FILING
(Redevelopment Agency of the City of San Bernardino)
THIS DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS, SECURITY
AGREEMENT AND FIXTURE FILING (the "Deed of Trust"), dated November _, 2008, is
made by the CALIFORNIA HOUSING FOUNDATION, INC., a California nonprofit public
benefit corporation, whose address is 1200 California Street, Suite 104, Redlands, California
92374 (the "Trustor"), in favor of (the "Trustee"), whose address is
, 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, California 92401 ("Beneficiary").
WITNESSETH: That the Trustor IRREVOCABLY AND UNCONDITIONALLY
GRANTS, TRANSFERS AND ASSIGNS to the Trustee, its successors and assigns, in trust,
with POWER OF SALE TOGETHER WITH RIGHT OF ENTRY AND POSSESSION the
Trust Property (as defined below) to secure, without lirnitation, the full and timely payment of
the indebtedness (the "Indebtedness") evidenced by that certain Promissory Note (the "Note"),
and all accrued interest thereon, of even date herewith, in the principal amount of Two Hundred
Thousand Dollars ($200,000.00), as executed by the Trustor in favor of the Beneficiary, and the
full and timely performance and discharge of all obligations under the Note, this Deed of Trust,
the Agency Regulatory Agreement (as defmed in the Note), and all other existing or future
agreements, documents, instruments, advances or loans by the Beneficiary to the Trustor,
evidencing, in connection with, or relating to the Indebtedness, the Note, this Deed of Trust
and/or the Agency Regulatory Agreement, or any other loan or loans by the Beneficiary to the
Trustor which recite that such loan is secured by this Deed of Trust (collectively, the "Secured
Obligations").
For purposes of this Deed of Trust, the term "Indebtedness" shall mean the principal of,
accrued and unpaid interest on, and all other late charges, fees, amounts and payments due under
or evidenced by the Note, this Deed of Trust, or the Agency Regulatory Agreement, and all
funds later advanced by the Beneficiary to or for the benefit of the Trustor under any provision
of the Note, this Deed of Trust or the Agency Regulatory Agreement.
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THE TRUSTOR HEREBY COVENANTS, REPRESENTS AND WARRANTS AS
FOLLOWS:
AGREEMENT
1. General. The Trust Estate shall include, without limitation, the Real Property,
the Rights and the Personal Property (as those terms are defmed below):
1.1. Real Property. 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 lirnited to, easements, rights-of-way, development rights
(including any mineral rights, water rights and water stock that the Trustor may have of whatever
kind or character, surface or underground) (collectively, the "Appurtenances").
1.2. Ri!!:hts. The "Rights" pertaining to the Real Property only (no other asset
or property of Trustor is intended to be included in the Rights). Rights include:
(a) 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 the Trustor in and
to all accounts, general intangibles, chattel paper, deposit accounts, money, instruments and
documents (as those terms are defmed in the California Uniform Commercial Code, hereinafter
the "UCC"), and all other agreements, obligations, rights and written materials, 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 fmancing 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;
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(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;
(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 Prooertv. The "Personal Property" includes (a) the Intangibles,
and (b) and all present and future right, title and interest of the Trustor in and to all inventory,
equipment, fixtures and other goods (as those terms are defmed in the DCC), 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,
development, 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 "Personal
Property" shall not include construction equipment and other personal property used during
construction of improvements on the Real Property and not owned by the Trustor or any other
personal property of Trustor that does not relate to the Real Property.
2. Grant of Security Interest. Trustor further grants to the Beneficiary, pursuant to
the DCC, a security interest in all present and future right, title and interest of the Trustor in and
to all Personal Property and the Rights in which a security interest may be created under the
DCC.
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3. Fixture Filine:. TIris 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 the Trustor (as "debtor") in favor of the Beneficiary (as a "secured
party").
4. Assie:nment of Monevs. Trustor irrevocably grants, transfers and assigns to
Beneficiary all of the Trustor's right, title and interest in and to the Moneys payable to the
Trustor from the Trustor's project consisting of the redevelopment, improvement, rehabilitation
and use of the Real Property as It residential facility for developmentally disabled adults for a
period of fifty-five (55) years from the date of this Deed of Trust (the "Project").
Notwithstanding such assignment, so long as no Event of Default has occurred, the Trustor shall
have the right to collect, receive, hold and dispose of the Moneys as the same become due and
payable, provided that unless the Beneficiary otherwise consents in writing: (a) any such Moneys
paid more than thirty (30) calendar days in advance of the date when due shall be delivered to the
Beneficiary and held by the Beneficiary, to be released and applied on the date when due (or, if
an Event of Default (as defined in Section 7.1 below) has occurred, at such other time or times
and in such manner as the Beneficiary may determine), and (b) if an Event of Default has
occurred, the Trustor's right to collect and receive the Moneys shall cease and the 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 the Moneys by the
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 the Beneficiary at any time or
from time to time, to collect the Moneys shall not in any manner affect the subsequent
enforcement by the Beneficiary of the right to collect the same. Nothing contained in this Deed
of Trust, nor the exercise of the right by the Beneficiary to collect the Moneys, shall be deemed
to make the Beneficiary a "mortgagee in possession" or shall be or be construed to be, an
affirmation by the Beneficiary of or an assumption of liability by the 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 the Trustor shall be accepted and held
for the Beneficiary in trust and shall not be commingled with the Trustor's funds and property,
but shall be promptly paid over to the Beneficiary.
S. Oblie:ations Secured. This Deed of Trust is given for the purpose of securing
payment and performance of each and every agreement and obligation of the Trustor under that
2008 Low and Moderate Income Housing Funds Loan and Grant Property Acquisition
Agreement (the "Agreement") and the related non-recourse Promissory Note, in a principal
amount of Two Hundred Thousand Dollars ($200,000.00) (the "Note", the terms of which are
incorporated herein by this reference), for the property located at:
APN: or contained herein or hereafter to be loaned to the Trustor (which
shall be deemed a grant after twenty (20) years of compliance with all requirements in
accordance with the Agreement), or its successors or assigns, when evidenced in writing that
they are secured by this Deed of Trust (referred to herein as the "Secured Obligations").
6. Trustor's Covenants. TO MAINTAIN AND PROTECT THE SECURITY OF
THIS DEED OF TRUST, TO SECURE FULL AND TIMELY PERFORMANCE BY THE
TRUSTOR OF EACH AND EVERY OBLIGATION, COVENANT AND AGREEMENT OF
THE TRUSTOR UNDER THE NOTE, AND AS ADDITIONAL CONSIDERATION FOR THE
4845-1322-8803.1 4
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INDEBTEDNESS AND OBLIGATIONS EVIDENCED BY THE NOTE, THE TRUSTOR
HEREBY COVENANTS, REPRESENTS AND AGREES AS FOLLOWS:
6.1. Payment and Performance of Secured Oblil!ations. Trustor shall pay
and perform all Secured Obligations in accordance with the respective terms of the Note.
6.2. Maintenance of Trust Estate. Unless the Beneficiary otherwise consents
in writing, the Trustor shall, at its sole cost and expense:
(a) keep the Real Property and the Personal Property 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 and/or the Personal Property that may be injured, damaged or
destroyed, and repair, restore or replace (at equal or greater value) any Personal Property that
may be injured, damaged, destroyed or lost, or that may be or become obsolete, defective or
worn out (except that the Trustor shall not be required to repair, restore or replace any such
Personal Property 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 mechanic's lien to arise against the Real Property or the Personal Property, or
adequately furnish a loss or liability bond against such lien claim;
(b) except as otherwise consented to by the 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 coinrnit 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 the Beneficiary may reasonably require, to protect the physical security of
the Real Property and of the Personal Property;
(h) except as otherwise consented to by Beneficiary in writing, not
part with possession of or abandon any part of the Trust Estate or the Personal Property 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 than to an affiliate of Trustor (which such affiliate shall mean an entity
4845-1322-8803.1
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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, including, without limitation, the
protection of the Goods and the enforcement or performance of any rights or obligations of the
Trustor or any conditions with respect to any of the Rights;
G) provide to the Beneficiary, within five (5) calendar days following
receipt of the Beneficiary's request, copies of all lease and sale agreements of any kind
encumbering or relating to the Real Property and/or to the Personal Property, certified by the
Trustor to be true and correct copies of valid agreements, as well as any other documentation
reasonably requested by the Beneficiary; and
(k) notify the Beneficiary in writing if any condition at or on the Real
Property, or in connection with the Rights and/or in connection with the Personal Property, that
may have a significant and measurable effect on their market value.
6.3. Insurance, Condemnation and Damaee Claims. Trustor shall maintain
"all risks" and general public liability insurance on the Real Property to the extent and in the
form required by the Beneficiary. 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 the Beneficiary (any such proceeds of any Damage Claim being
referred to in this Deed of Trust as "Damage Proceeds"). Trustor shall take all action reasonably
necessary or required by the Beneficiary in order to protect the Trustor's and the 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 the Beneficiary
may in its discretion participate in any such action or proceeding at the expense of the Trustor.
So long as no Event of Default has occurred, the Trustor may settle, compromise
or adjust any Damage Claim. Upon the occurrence of any Event of Default, the Beneficiary shall
have the sole right to settle, compromise or adjust any Damage Claim in such manner as the
Beneficiary may determine, and for this purpose the Beneficiary may, in its own name or in the
name of the Trustor, take such action as the 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 the Beneficiary as provided in the preceding
paragraph.
Any Damage Proceeds received by the Beneficiary may be applied by the
Beneficiary in payment of the Secured Obligations in such order and manner as the Beneficiary
may determine, provided that so long as no Event of Default has occurred, the Beneficiary shall
release such Damage Proceeds to the Trustor for the repair and restoration of the Real Property,
except that the Beneficiary shall not be required to release such Damage Proceeds (and may
apply such Damage Proceeds to the Secured Obligations as set forth above) to the extent that
such Damage Proceeds relate to any condemnation, seizure or other appropriation by any
4845-1322-8803.1
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governmental agency of all or any portion of the Real Property (including Damage Proceeds
payable in lieu of any such action), or if the 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 the 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, and the Trustor shall pay and perform when due all other obligations secured by or
constituting a lien affecting any part of the Trust Estate.
6.5. Claims. Trustor shall appear in and defend any claim or any action or
other 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 the Beneficiary or the Trustee,
and give the Beneficiary prompt written notice of any such claim, action or proceeding.
Beneficiary and the Trustee may, at the expense of the Trustor, appear in and defend any such
claim, action or proceeding and any claim, action or other proceeding asserted or brought against
the Beneficiary (and the Beneficiary's general partners, agents, employees, partners, unitholders,
shareholders, affiliates, officers and directors, each a "Beneficiary Indemnitee"), or the Trustee
in connection with or relating to any part ofthe Trust Estate or this Deed of Trust.
6.6 Leases of Real Property. At the Beneficiary's request, the Trustor shall
furnish the Beneficiary with executed copies of all leases of the Real Property or any portion of
it.
6.7 Uniform Commercial Code Securitv Ae:reement. This Deed of Trust is
intended to be and shall constitute a security agreement under the California DCC for any of the
Trust Estate noted herein, that, under law may be subject to a security interest under the DCC,
and the Trustor grants to the Beneficiary a security interest in those items. Trustor authorizes the
Beneficiary to file financing statements in all states, counties and other jurisdictions as the
Beneficiary may elect, without the Trustor's signature if permitted by law. Trustor agrees that
the 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 the Beneficiary
may elect, as a fmancing 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)
The Trustor fails to make any payment when due under the Note, this
Deed of Trust and/or under the Agency Regulatory Agreement.
(b)
The Trustor defaults on any promise the Trustor has made to the Trustee
or to the 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, in the Agency Regulatory Agreement, or
any agreement related to the Note and this Deed of Trust.
4845-1322-8803.1
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(c) 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.
(d) 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; or any
representation or statement made by or on behalf of the Trustor in the
Agency Regulatory Agreement is false or misleading in any material
respect either now or at the time made or furnished.
(e) If the Trustor becomes insolvent, or if a receiver is appointed for any part
of 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.
(f) 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.
(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 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 the Beneficiary, other than to an affiliate of the Trustor,
which such affiliate shall mean an entity owned by the Trustor or its
principals and the Trustor or its principals shall be responsible for the day-
to-day management of its activities.
(i) Notwithstanding Sections 7.1(b) through (h) above, the Trustor shall not
be in default unless the Trustor fails to cure a breach within fifteen (15)
business days after receipt of written notice from the Trustee or from the
Beneficiary of such breach, and if any other provision of this Deed of
Trust or any provision of the Secured Obligations 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 the 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, the Trustor shall
then be in default under this Deed of Trust, and upon acceleration of the maturity of the Secured
Obligations, the Secured Obligations shall immediately become due and payable without further
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notice to the Trustor, and the Beneficiary may, without notice to or demand upon the Trustor,
which notice and/or demand are expressly waived by the Trustor (except for notices or demands
otherwise required by applicable laws to the extent not effectively waived by the Trustor and any
notices or demands specified below), and without releasing the 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 Obligations, exercise anyone or more of the
following remedies, as the 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 the Trustor relating to the Trust Estate, all without payment of rent or
other compensation to the Trustor;
(b) enter into such contracts and take such other action as the
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 the Beneficiary may deem appropriate in its sole
and absolute discretion;
(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 the Trustor,
otherwise conduct any business of the Trustor in relation to the Trust Estate and deal with the
Trustor's creditors, debtors, tenants, prospective tenants, agents and employees and any other
persons having any relationship with the Trustor in relation to the Trust Estate, and amend any
contracts between them, in any manner the Beneficiary may determine with the Trustor
executing a power of attorney or similar document required in order for the 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 the 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, except that the Trustor
agrees not to take any such action after the occurrence of an Event of Default without prior
written authorization from the Beneficiary;
( e) take any such other action as the Beneficiary deems appropriate to
protect the security of this Deed of Trust; and
(f) Notwithstanding Sections 7.2(a) through (e), neither the
Beneficiary nor the Trustee shall be under any obligation to preserve, maintain or protect the
Trust Estate or any of the 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 the Trustee do not assume and
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shall have no liability for, and shall not be obligated to perform, any of the 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 the Trustor from any such obligations.
7.3. Foreclosure Remedv. Beneficiary, in its sole and absolute discretion,
may execute and deliver to the Trustee written declaration of default and demand for sale and
written notice of default and of election to cause all or any part of the Trust Estate to be sold,
which notice the 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, the Trustee, without demand on the Trustor, shall
sell such Trust Estate property at the time and place fixed by the Trustee in such notice of sale,
either as a whole or in separate parcels and in such order as the Beneficiary may direct (the
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 the Trustee to the
extent permitted by 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 the Trustor and any
purchase agreement, encumbrance or other matter affecting the property sold which is subject or
subordinate to this Deed of Trust, unless the Beneficiary consents to otherwise in writing. Any
person, including the Trustee or the Beneficiary, may purchase all or any part of the Trust Estate
at such sale. Any bid by the Beneficiary may be, in whole or in part, in the form of cancellation
of all or any part of the Secured Obligations (the "Credit Bid").
7.4. Secured Creditor Remedv. With respect to any Personal Property, the
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 the Trustor, on demand, to assemble
all Personal Property and make it available to the Beneficiary at places that the 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 any instrument, agreement or document (the
"Other Instrument") evidencing, securing, guaranteeing or relating to the loan made by the
Beneficiary to the Trustor as evidenced by the Note and secured by this Deed of Trust and the
Agency Regulatory Agreement, 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 Agency Regulatory Agreement, the Note and/or in any Other
Instrument, or pursuant to all applicable laws. Each remedy may be exercised from time to time
as often as deemed necessary by the Trustee and the Beneficiary, and in such order and manner
as the Beneficiary may determine. This Deed of Trust is independent of any other security for
the Secured Obligations, and upon the occurrence of an Event of Default, the Trustee or the
Beneficiary may proceed in the enforcement of this Deed of Trust independently of any other
remedy that the Trustee or the 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
4845-1322-8803.1
10
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claiming by or through the Trustor, waives, to the fullest extent permitted by applicable laws, all
rights to require a marshalling of assets by the Trustee or the Beneficiary or to require the
Trustee or the 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 the Trustor) before
resorting to any other portion, and all rights of redemption, stay and appraisal.
7.6. Application of Sums. Unless otherwise specified in this Deed of Trust, in
the Agency Regulatory Agreement, in the Note or in any Other Instrument, all sums received by
the Beneficiary under this Deed of Trust, shall be applied to: (i) all costs and expenses incurred
by the Beneficiary, the Trustee or any receiver under this Deed of Trust, including without
limitation, attorneys' fees; and (ii) the remainder, in payment of the Secured Obligations in such
order and manner as the Beneficiary shall determine in its sole discretion; provided, however,
that the Beneficiary shall have no liability for funds not actually received by the Beneficiary.
7.7. Costs. Fees and Expenses. Trustor shall pay on demand all costs, fees,
expenses, advances, charges, losses and liabilities of the Trustee and the 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 the Trustee or by the 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 the Trustee; (b) costs and expenses of the Beneficiary or of the 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 the 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 the Trustee's and the Beneficiary's legal counsel and other out-of-pocket
expenses, and the reasonable charges of the 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 the Beneficiary
and (ii) at the rate provided by law in the case of any such interest payable to the Trustee.
7.8. Late Pavments. By accepting payment of any part of the Secured
Obligations after its due date, the Beneficiary does not waive its right either to require prompt
payment when due of all other portions of the Secured Obligations or to declare a default for
failure to so pay.
7.9. Action bv Trustee. At any time and from time to time upon written
request of the Beneficiary and presentation of this Deed of Trust for endorsement, and without
affecting the personal liability of any person for payment of the Secured Obligations 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, the 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 notify the Trustor or the
Beneficiary of any pending sale under any other deed of trust or of any action or other
4845-1322-8803.1 I I
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proceeding in which the Trustor, the Beneficiary or the Trustee is a party unless brought by the
Trustee.
8. Reconvevance. Upon the Beneficiary's written request and surrender of this
Deed of Trust and the Notes to the Trustee for cancellation or endorsement, the Trustee shall
reconvey, without warranty, all or any part of the Trust Estate then subject to this Deed of Trust
that the 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 Obligations and termination of all obligations of the
Beneficiary under or in connection with the Note.
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
formaldehyde insulation, radioactive materials, hazardous waste, toxic or contaminated
substances 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 the Trustor's
business, the Trustor shall not cause or permit the Real Property and/or the Personal 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 and/or the Personal Property to comply with all Hazardous Materials Laws.
Trustor shall immediately notifY the Beneficiary in writing of: (i) the discovery of any Hazardous
Materials on, under or about the Real Property and/or the Personal Property; (ii) any knowledge
by the Trustor that the Real Property and/or the Personal Property does not comply with any
Hazardous Materials Laws or (iii) any Hazardous Materials Claim. After such notice, the
Beneficiary shall have the right to inspect the Real Property and/or the Personal Property.
Beneficiary may request and the Trustor shall provide at its sole costs and expense, within sixty
(60) calendar days, a report from a qualified engineering company or other qualified consultant
acceptable to the Beneficiary, with respect to an investigation and audit of the Real Property
and/or the Personal Property satisfactory to the Beneficiary. Additionally, in response to the
presence of any Hazardous Materials on, under or about the Real Property and/or the Personal
Property, the Trustor shall immediately take, at the 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.
4845-1322-8803.1 12
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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
Beneficiary), of all or any part of the Real Property and/or of the Personal Property, or any
interest in the Real Property and/or in the Personal Property. A "sale, transfer or encumbrance"
means the conveyance of the Real Property and/or of the Personal 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 (1) 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.
Successors and Assigns. 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.
10.2. Acceptance. Notice of acceptance of this Deed of Trust by the
Beneficiary or the Trustee is waived by the 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.
10.3. Beneficiarv's Statements. For any statement regarding the Secured
Obligations, the Beneficiary may charge the maximum amount permitted by law at the time of
the request for such statement.
10.4. Governinl!: Law. This Deed of Trust shall be governed by and construed
and enforced in accordance with, the laws of the State of California.
10.5. Request for Notice. Trustor requests that a copy of any notice of default
and a copy of any notice of sale be mailed to the Trustor at the Trustor's address as first set forth
above.
10.6. Attornevs' 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.
10.7. Substitution of Trustee. Beneficiary may from time to time, by
instrument in writing, substitute a successor or successors to any Trustee named in or acting
under this Deed of Trust, which instrument, when executed by the Beneficiary and duly
acknowledged and recorded in the office of the recorder of the county or counties where the
Land is situated, shall be conclusive proof of proper substitution of such successor the Trustee or
the Trustees who shall, without conveyance from the predecessor the Trustee, succeed to all of
its title, estate, rights, powers and duties. Such instrument shall contain the name of the original
Trustor, the Trustee and the 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.
10.8. Successors and Assil!:Ds. 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 to their respective
successors and assigns.
4845-1322-8803.1 13
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IN WITNESS WHEREOF, Trustor hereby executes this Deed of Trust as of the
date set forth below.
"TRUSTOR":
CALIFORNIA HOUSING FOUNDATION, INC.,
a California non-profit public benefit corporation
Date:
By:
Name:
Title:
4845-1322-8803.1 14
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EXHIBIT "A"
LEGAL DESCRIPTION OF SITE
I) 6728 NORTH OFELIA DRIVE, SAN BERNARDINO, CALIFORNIA 92407
LOT 32 OF TRACT NO. 16792, IN THE CITY OF SAN BERNARDINO, COUNTY
OF SAN BERNARDINO, STATE OF CALIFORNIA, AS SHOWN BY MAP ON FILE
IN BOOK 315 PAGES 43 THROUGH 45 INCLUSIVE OF MAPS, IN THE OFFICE OF
THE COUNTY RECORDER OF SAID COUNTY.
APN: 0261-701-15-0000
2) 6538 NORTH JORDAN LANE, SAN BERNARDINO, CALIFORNIA 92407
LOT 96 OF TRACT NO. 16443, IN THE CITY OF SAN BERNARDINO, COUNTY
OF SAN BERNARDINO, STATE OF CALIFORNIA, AS SHOWN BY MAP ON FILE
IN BOOK 300 PAGE 67, IN THE OFFICE OF THE COUNTY RECORDER OF SAID
COUNTY.
APN: 0261-671-48-0000
4845-1322-8803.1 15
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SUBORDINA nON ADDENDUM
This Subordination Addendum ("Addendum") is attached to and forms a part of that
certain deed of "'ust (the "Deed of Trust") dated , executed by the CALIFORNIA
HOUSING FOUNDA nON, INC., a California non-profit public benefit corporation, as the
"Trustor" in favor of the REDEVELOPMENT AGENCY OF THE CITY OF SAN
BERNARDINO, a public body, corporate and politic, as a "Beneficiary" and naming
as the "Trustee".
Inconsideration of the Trustor's execution and delivery of the Deed of Trust, as long as
the Trustor is not in default under the Deed of Trust, the Beneficiary hereby agrees to
subordinate the lien of the Deed of Trust from time to time to the lien(s) of one or more
subsequent deed(s) of trust covering the described property located at and in
Exhibit A attached to the Deed of Trust in accordance with the terms, covenants, and conditions
set forth in this Addendum.
The Beneficiary's obligation to subordinate to subsequent deeds of trust securing loans
obtained by the Trustor (the "Subordinating Loans") shall be subject to the following terms and
conditions:
(a) The proceeds of the Subordinating Loans shall be used only for the construction,
remodeling, renovation, reconstruction, maintenance, repair or service of the Real Property in
furtherance of the uses authorized for the Real Property as stated in Section 318 of the
Agreement;
(b)
The total amount of the Subordinating Loans shall not exceed $200,000;
(e)
conditions:
The Subordinating Loans shall have the following additional terms and
1.
The interest rate shall not exceed 7.5% exclusive of late charges, penalties or
fees payable in case of default;
II.
The Subordinating Loans shall reqUire monthly payments of amortizing
principal and interest;
111.
The Subordinating Loans shall have a term of not less than 20 years or more
than 30 years;
IV.
The maximum loan fees payable on the Subordinating Loans shall not exceed
2% of the loan amount;
Upon compliance with the terms and conditions set forth above and with Section 315.5 of
the Agreement, at the written request of the Developer, the Agency agrees to execute a
Subordination Agreement suitable for recording in a form substantially similar as provided in
Exhibit "E" of the Grant Agreement.
4845-1322-8803.1
16
P:\Agendas\Agendi Anachmenu\E>;hibits\2008\II-OJ-08 California Housing Foundation - Deed orTrust (EJdiibit D)doc
Any subordination under this Addendum shall be effected through the following procedure:
(a) The Trustor shall request the subordination in writing. The written request shall
be delivered to the Beneficiary together with a sample of the proposed promissory
note, deed of trust, assignment of rents, and/or construction loan agreement for
the subordinating loan, the proposed subordination agreement, and other loan
documents or information as the Beneficiary may reasonably request. The request
and loan documents shall specify the lender's identity; the purpose for which
borrowed funds may be used; the loan amount, interest rate, and maturity date.
(b) The Beneficiary shall be entitled to review and approve the loan documents, as
long as the Beneficiary's approval is not unreasonably withheld or delayed. The
Beneficiary's approval shall in no event be withheld or delayed if the loan
documents contain only the provisions described in this Addendum and such
other provisions as institutional lenders customarily require for loans of the type
described in this Addendum.
(c) Within ten (10) calendar days after receipt of the Trustor's written request for
subordination and the materials provided for above, the beneficiary shall either:
a. deliver to the escrow holder an original subordination agreement duly
executed and acknowledged by the Beneficiary; or
b. deliver to the escrow holder and to the Trustor written notice of the
Beneficiary's specific reasons for not approving the proposed loan and
subordination documents.
(d) All subordination costs shall be borne by the Trustor.
(e) The loan shall be evidenced by a promissory note not in excess of $200,000.
(f) The loan shall be used only for construction, remodeling, renovation,
reconstruction, maintenance; repair or service of the Real Property as defined in
the Deed of Trust.
IN WITNESS WHEREOF, Trustor hereby executes this Subordination Addendum to the
Deed of Trust as of the date set forth below:
"TRUSTOR"
CALIFORNIA HOUSING FOUNDATION, INC.,
a California non-profit public benefit corporation
By:
4845-1322-8803.1
17
P:\Agendas\Agenda Attaehments\Elthibits\2008\II-03-08 California Housing Foundalion. Deed ofTrl.J.$t (El<:hibit D)doc
STATE OF CALIFORNIA }
} ss
COUNTY OF SAN BERNARDINO }
, before me, (here
title of the officer), personally appeared
, who 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 hislher.'their authorized capacity(ies),
and that by hislher/their signature(s) on the instrument the person(s), or the entity on behalf of
which the person(s) acted, executed the instrument.
On
insert
name
and
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature
(This area for official notarial seal)
4845-1322-8803.1
18
P:\Agendas\Agenda Attacltments\Exllibi{s\2008\ll-03-08 California Housing Foundation _ Deed ofTrusl (Exhibit D).doc
EXHIBIT "E"
FORM OF SUBORDINATION AGREEMENT
RECORDING REOUESTED BY:
WHEN RECORDED MAIL TO:
Space Above This Lioe for Recorder's Use
SUBORDINATION AGREEMENT
This Subordination Agreement ("Agreement") made as of (date) by the
Redevelopment Agency of the City of San Bernardino, a public body, corporate and politic, having an at
address of 201 North "E" Street, Suite 301, San Bernardino, California 92401 ("Subordinator"), and
(Name of new lender), a corporation organized and existing under the laws of the
State of California, with its principal place of business at
(address) ("Lender").
RECITALS:
A. California Housing Foundation, Inc., a California non-profit public benefit corporation, with its
principal office located at 1200 California Street, Suite ]04, Redlands, California 92374,
("Borrower"), has applied to Lender for a loan to be made to Borrower and to be evidenced by a
promissory note secured by a deed of trust covering certain real property.
B. The real property offered by Borrower as security to Lender is currently subject to the prior lien of
the deed of trust described below.
C. Lender will make such loan to Borrower only on the condition precedent that such mortgage be
subordinated to the lien of the mortgage described below to be given by Borrower to Lender.
In consideration of the matters described above, and of the mutual benefits and obligations set forth
in this Agreement, the parties agree as follows:
SUBORDINATION OF EXISTING MORTGAGE
The deed of trust to be subordinated covers real property described in Exhibit A attached hereto
and was made on (date) between the California Housing Foundation, Inc., a
California non-profit public benefit corporation, and the , a public body, corporate and politic, and filed or
recorded on (date), in book _ page -' of the records of the County of San
Bernardino, State of California, shall be and the same is now subordinated and made subject and
subsequent to the lien of that certain deed of trust covering the real property located at:
4819-2907-8787.1819-2907-8787.1
I
and referenced in Exhibit A, dated (date), between
California Housing Foundation, Inc., a non-profit public benefit corporation, and
(Name of new lender), and filed or recorded on (date), in book _ page _, of
the records of the County of San Bernardino, State of California.
The undersigned Subordinator has executed this Agreement at San Bernardino, California on the
date appearing below.
SUBORDINATOR
Dated
[Print Name and Title of Sub or din at or]
STATE OF CALIFORNIA }
} ss
COUNTY OF SAN BERNARDINO }
On , before me, (here insert
name and title of the officer), personally appeared
who 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
hislher/their authorized capacity(ies), and that by hislher/their signature(s) on the instrument the
person( s), or the entity on behalf of which the person( s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of Cali fomi a that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature
(This area for official notarial seal)
4819-2907-8787.1819-2907-8787.1
EXHIBIT" A"
(Description of Property)
1) 6728 NORTH OFELIA DRIVE, SAN BERNARDINO, CALIFORNIA 92407
LOT 32 OF TRACT NO. 16792, IN THE CITY OF SAN BERNARDINO, COUNTY
OF SAN BERNARDINO, STATE OF CALIFORNIA, AS SHOWN BY MAP ON FILE
IN BOOK 315 PAGES 43 THROUGH 45 INCLUSIVE OF MAPS, IN THE OFFICE OF
THE COUNTY RECORDER OF SAID COUNTY.
APN: 0261-701-15-0000
2) 6538 NORTH JORDAN LANE, SAN BERNARDINO, CALIFORNIA 92407
LOT 96 OF TRACT NO. 16443, IN THE CITY OF SAN BERNARDINO, COUNTY
OF SAN BERNARDINO, STATE OF CALIFORNIA, AS SHOWN BY MAP ON FILE
IN BOOK 300 PAGE 67, IN THE OFFICE OF THE COUNTY RECORDER OF SAID
COUNTY.
APN: 0261-671-48-0000
4819.2907-8787.1819-2907-8787.1
3
:~,.-
INLAND REGIONAL CENTER
... valuinl! independence. inclusion and e11l1Jowermenl
674 Brier Drive, San Bernardino, CA 92408
P.O. Box 6127, San Bernardino, CA 92412-6127
Telephone: 909-890-3000
Fax: 909-890-3001
September 5, 2008
Steve Von Rajcs
California Housing Foundation
1200 California Ste 104
Redlands, CA 92374
Dear Mr. Von Rajcs,
This letter is in follow up to our conversation and subsequent plans to work in partnership toward
obtaining and developing sustainable housing options for people who have Developmental Disabilities in
Riverside and San Bernardino Counties.
. IRC has received preliminary approval from the Department of Developmental Services to su~port your
acquisition of housing up to 25% of the total cost. We are confident that we can receive final approval
from the Department of Developmental Services to provide such support to CHF once you are able to
identify potential sources to leverage funds. IRC has reviewed your two proposed properties and both
appear to be quite promising. I look forwarding to hearing from you soon. Please feel free to reach me
at (909) 890-3493.
Sincerely,
\~ ~d H_
):. 'WL/~-
.:-corina Le;tlM. .
Chief, Community Services
CD:sg!IRC/9-S-Q8
cc: Mary Lynn Clark, Director