HomeMy WebLinkAboutR23-Economic Development Agency
ECONOMIC DEVELOPMENT AGENCY ORlGiNAL
OF THE CITY OF SAN BERNARDINO
DATE:
January 3, 2005
SUBJECT: JOINT PUBLIC HEARING 2005
MEADOWBROOK SINGLE FAMILY
RESIDENTIAL DISPOSITION AND
DEVELOPMENT AGREEMENT WITH
MEADOWBROOK PARK HOMES, INC.
FROM:
Maggie Pacheco
Deputy Director
---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Svnoosis of Previous Commission/Council/Committee Action(s):
On October 19, 2004, Redevelopment Committee Members Estrada, Longville and McGinnis unanimously voted to
recommend that the Community Development Commission consider this action for approval.
On November 1, 2004, the Mayor and Common Council directed Staff to prepare the Disposition and Development
Agreement for consideration and approval.
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Recommended Motion(s):
OPEN/CLOSE JOINT PUBLIC HEARING
MOTION A:
(Mavor and Common Council)
A RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN
BERNARDINO APPROVING THE 2005 MEADOWBROOK SINGLE FAMILY RESIDENTIAL
DISPOSITION AND DEVELOPMENT AGREEMENT BY AND BETWEEN THE
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO AND MEADOWBROOK
PARK HOMES, INe. (AFFORDABLE HOUSING DEVELOPMENT - IVDA REDEVELOPMENT
PROJECT AREA)
MOTION B:
(Communitv Deve100ment Commission)
A RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF SAN
BERNARDINO APPROVING THE 2005 MEADOWBROOK SINGLE F AMIL Y RESIDENTIAL
DISPOSITION AND DEVELOPMENT AGREEMENT BY AND BETWEEN THE
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO AND MEADOWBROOK
PARK HOMES, INC. (AFFORDABLE HOUSING DEVELOPMENT - IVDA REDEVELOPMENT
PROJECT AREA)
--*-------------------------~--------------------------------------------------------------------------------------------------------------------------------------------------.--------------------------------------
Contact Person( s):
Gary Van Osdel/Maggie Pacheco
Phone:
(909) 663-1044
Project Area(s)
IVDA
Ward(s):
Supporting Data Attached:
o Staff Report 0 Resolution(s) Ii"! Agreement(s)/Contract(s) Ii"! Map(s) 0 Letter/Memo
FUNDING REQUIREMENTS
Amount: $ 1,344,550
Source:
Low/Mod Housing Fund
SIGNATURE:
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Commission/Council Notes:
~C)~7~~-Ptiv
---.----------------.------------------------------------------------------------------------------------------------------------------------------------
P:\Agendas\Comm Dev Commission\CDC 2005\05-01-10 Meadowbrook Park Homes SR.doc
4818-4449-4080.1
COMMISSION MEETING AGENDA
Meeting Date: 01/10/2005
Agenda Item Number: K.,') 3
ECONOMIC DEVELOPMENT AGENCY
STAFF REPORT
---------------------------------------------------------------------------------------------------------------------
JOINT PUBLIC HEARING - 2005 MEADOWBROOK SINGLE F AMIL Y RESIDENTIAL
DISPOSITION AND DEVELOPMENT AGREEMENT
WITH MEADOWBROOK PARK HOMES, INC.
BACKGROUND:
In order to revitalize the Meadowbrook Neighborhood, the Community Development Commission
(the "Commission") approved the Meadowbrook Single Family Residential Grant Development
Agreement (the "2003 Agreement") with ANR Industries, Inc, in February 2003. The 2003
Agreement was focused on the development of 23 new single-family homes. These new homes
were to be constructed on 22 rarcels owned by ANR, and on one (1) parcel owned by the Agency
within an area bounded by 2" Street on the north and Rialto Avenue on the south, Sierra Way on
the west and Allen Street on the east. Each of the 23 new homes covered by the 2003 Agreement
were to include approximately 1,400 to 1,700 square feet in interior living area and the new homes
had several floor plans for 3 bedrooms homes and several other floor plans for the 4 bedroom
homes. The various floor plans were further differentiated by three (3) different elevations: (i)
Victorian; (ii) Spanish; and (iii) Craftsman. Development of the new homes under the 2003
Agreement is referred to as the "Meadowbrook Phase I Project" or the "Phase I Project".
Pursuant to the 2003 Agreement, the Agency provided ANR with a grant of Agency "Low- and
Moderate-Income Housing Funds" in the amount of $500,000 to insure that ten (10) of the 23 new
homes in the Phase I Project will be affordable and available for purchase by households with
annual income of up to 120% of County median household income. A ground-breaking ceremony
for the Phase I Project was held on August 5, 2004, and construction is now well underway on the
23 new homes. Ten (10) of the new homes in the Phase I Project are anticipated to be completed by
the end of January 2005. The ten (10) affordable New Homes have been pre-sold at prices ranging
between $210,000 to $267,000 to income eligible buyers (up to 120% of County median income).
The remaining thirteen (13) New Homes will be sold without price or income occupancy
restrictions presently at prices ranging from $236,000 to $291,000. The Phase I Project has met
with great success and establishes a firm foundation for further neighborhood restoration efforts in
the Meadowbrook Neighborhood.
Subsequent to the approval of the 2003 Agreement, the Commission authorized the Agency and the
City of San Bernardino Housing Authority (the "Authority"), to enter into a cooperation agreement
and to acquire up to eight (8) additional parcels of land in the Meadowbrook Neighborhood as part
of a potential "Phase IA Project" to further expand the supply of new single family homes available
at affordable prices to Moderate-Income families as defined in the 2005 Agreement. Phase IA
Project Area boundary extends the existing boundary to Waterman Avenue on the east from Allen
Street. These additional parcels are referred to as the "Agency Lots". The Agency Lots acquired
for Phase IA Project are either vacant parcels or old dilapidated and substandard
---------------------------------------------------------------------------------------------------------------------------------------------
P:\Agendas\Comm Dev Commission\COC 2005\05-01-10 Meadowbrook Park Homes SR. doc
4818-4449-4080.\
COMMISSION MEETING AGENDA
Meeting Date: 01/10/2005
Agenda Item Number:
Economic Development Agency Staff Report
Meadowbrook Single Family Residential DDA
Page 2
--------------------------------------------------------------------------------------------------------------------
structures. The Agency Lots include two (2) vacant parcels, one (1) previously occupied rental
unit, and five (5) vacant rental units. The Agency has acquired the Agency Lots through
negotiation from prior owners or defaulted property tax sales. The acquisition of four (4) more
Agency Lots are pending negotiation by the Agency and if such negotiations are not successful,
the Housing Authority may be requested to acquire one or more of the remaining Agency Lots
through condemnation proceedings. The four (4) remaining potential Agency Lots are not the
subject of the 2005 Agreement at this time.
The disposition of the eight (8) Agency Lots, which have been acquired as of December 2004, is
the subject of the proposed 2005 Agreement and the joint public hearing.
CURRENT ISSUE:
Meadowbrook Park Homes, Inc. (the "Developer") is a housing development entity related to
ANR Industries, Inc., and the Developer proposes to continue the very solid start made under the
2003 Agreement to restore the Meadowbrook Neighborhood as a single family home
community. The Developer has recently acquired or control a number of other parcels in the
Meadowbrook Neighborhood in addition to and separate from the 23 New Homes under
construction pursuant to the 2003 Agreement. The Developer seeks to purchase the eight (8)
Agency Lots from the Agency and develop them with New Homes, which are similar in size, and
design with the other New Homes currently under construction in the Phase I Project in
accordance with the attached 2005 Meadowbrook Single Family Residential Disposition and
Development Agreement (Meadowbrook neighborhood Restoration Area) ("2005 Agreement").
It is proposed that the eight (8) Agency Lots be sold to the Developer for the development of six
(6) affordable new homes (each reserved for occupancy by a Moderate-Income Household
earning up to 120% of County median income) and two (2) market-rate new homes (e.g., no
sales price or household income restrictions).
Except for the eight (8) Agency Lots, the Agency has no obligation to acquire any other lands in
the Meadowbrook Neighborhood on behalf of the Developer under the terms of the 2005
Agreement. Although the Agency is currently in the process of acquiring four (4) additional
Agency Lots as described above, the Agency has no obligation to the Developer to complete
such acquisitions. Furthermore, the transfer of any additional Agency Lots following the first
eight (8) such Agency Lots, will be subject to separate approvals in the future by the Mayor and
Common Council and the Commission following one or more public hearings, as mandated by
Health and Safety Code Section 33433.
For the purpose of the Health and Safety Code Section 33433 Report (described below as the
"Summary Report"), the Phase IA Project includes only the eight (8) Agency Lots (Attachment
1: Area Map).
---------------------------------------------------------------------------------------------------------------------------------------------
P:\Agendas\Comm Dev Conunission\COC 2005\05.01-10 Meadowbrook Park Homes SR,doc
4818-4449-4080.1
COMMISSION MEETING AGENDA
Meeting Date: 01110/2005
Agenda Item Number:
Economic Development Agency Staff Report
Meadowbrook Single Family Residential DDA
Page 3
--------------------------------------------------------------------------------------------------------------------
The proposed 2005 Agreement sets forth the terms and conditions under which the Agency Lots
will be transferred to the Developer for development and sale of New Homes. The conditions in
the 2005 Agreement are:
. six (6) Agency Lots (Type A) will be developed by the Developer with New
Homes and will be sold at an affordable price for occupancy by a Moderate-
Income Household (up to 120% of County median household income) with a
recorded 45-year Housing Affordability Covenant and Restriction (CC&R). To
enable a homebuyer to buy a New Home, it is recommended that the Agency
provide down payment/closing costs assistance of up to 20% of the purchase price
of a restricted New Home. Staff recommends that the Agency allocate up to
$500,000, from the Agency's Low/Mod Housing Fund for this purpose. Two (2)
Agency Lots (Type C) will be developed with New Homes and sold at market rate
with no sales price or income occupancy restriction;
. the Developer shall pay the Agency the sum of $30,000 for six (6) Type A and
$50,000 for two (2) Type C Agency Lots for a total consideration to the Agency
of $280,000. This $280,000 will be used to off-set the Agency direct subsidy
costs to the Phase IA Project of $844,550. The Developer must acquire each
Agency Lot in an AS IS condition. The payment by the Developer for the
Agency Lots shall be evidenced by a promissory note secured by a subordinate
deed of trust to a construction loan on the Agency Lot. Each promissory note is
payable by the Developer at the time of sale of the Agency Lot to a "Qualified
Homebuyer". No interest accrues on the promissory note during the first eighteen
(18) months for the six (6) Type A Agency Lots, but after that date, the rate of
interest is 6% per annum until paid. The payment by the Developer to the Agency
for the 2 Type C Agency Lots is deferred until the sale of the Agency Lot to the
Developer's Buyer, but interest begins accruing immediately upon conveyance of
the Type C Agency Lot to the Developer.
. the Developer shall construct single family homes on each Agency Lot which are
similar in size and design with DP III No. 03-34, as approved by the Planning
Commission on November 18, 2003 for the Phase I Project; total development
costs are estimated in excess of $2 million. The Development of the New Homes
is expected to begin thirty (30) days after the Agency/Developer have closed
escrow on the Agency Lots, and expected to be completed within twelve (12)
months.
. on the six Type A Agency Lots, after the Developer has realized its 10% profit,
the remaining balance of the sales proceeds, if any, shall be divided in half
between the Agency and the Developer in accordance with Section 2.15 of the
2005 Agreement;
---------------------------------------------------------------------------------------------------------------------------------------------
P:\Agendas\Comm Dev Conunission\CDC 2005\05-01-10 Meadowbrook Park Homes SR.doc
4818-4449-4080.\
COMMISSION MEETING AGENDA
Meeting Date: 01/10/2005
Agenda Item Number:
Economic Development Agency Staff Report
Meadowbrook Single Family Residential DDA
Page 4
--------------------------------------------------------------------------------------------------------------------
Prior to the proposed sale of the Agency Lots to the Developer, the Commission and Council are
required to conduct a public hearing in accordance with Health and Safety Code Section 33433
and to consider the proposed 2005 Agreement. The Summary Report identifies the salient points
of the 2005 Agreement, the cost of the sale of the Agency Lots to the Developer for
improvement as part of the Phase IA Project and the estimated value of the interests conveyed in
the eight (8) Agency Lots determined at the highest and best use permitted based on the
restricted reuse value and the CC&R's which are part of the 2005 Agreement. As required under
the Health and Safety Code Section 33433, a public notice of this joint public hearing was
published in the Sun Newspaper of November 22 and 29, 2004.
ENVIRONMENTAL IMPACT:
The proposed Phase IA Project (e.g., up to the eight (8) Agency Lots described above) is a
categorically exempt project under the California Environmental Quality Act ("CEQA"). The
Phase IA Project consists of an infill housing project where each of the Agency Lots has
previously been improved, where each such Agency Lot enjoys full utility services, and where
each such Agency Lot abuts a dedicated and fully improved public street. The Phase IA Project
will be developed consistent with the City's General Plan and Zoning. Accordingly, a Notice of
Exemption for the Phase IA Project under CEQA will be filed with the County Clerk subject to
the Mayor and Common Council's and Commission's approval of the Phase IA Project.
FISCAL IMPACT:
The Summary Report shows the Agency's expenditure related to the eight (8) Agency Lots is
$844,550. This figure includes actual acquisition costs and related costs paid by the Agency to
third parties, relocation costs paid to date, and demolition expenses. The total consideration to
be paid by the Developer to the Agency for all eight Agency Lots is $280,000 as described
above. Additionally, $500,000 will be allocated from the Agency's Low/Moderate Housing
Fund for down payment/closing costs assistance to qualified homebuyers.
RECOMMENDATION:
That the Mayor and Common Council and the Community Development Commission adopt the
attached Resolutions.
'-...
Maggie Pacheco, Deputy Director
-----------------------------------------------------------------------------------------------------------------------------------------......--
P:\Agendas\Comm Dev CommissK>n\CDC 2005\05-01-10 Meadowbrook Park Homes SR.OOc
4818-4449-4080.1
COMMISSION MEETING AGENDA
Meeting Date: 01/10/2005
Agenda Item Number:
133HlS
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I
E C ON OMIC DE VE LOPMENT AGENC"1'\RJ G1NAL
OF THE CITY OF SAN BERNARDINO U j
FROM: Maggie Pacheco
Deputy Director
SUBJECT:
SETTING A PUBLIC HEARING TO
CONSIDER THE MEADOWBROOK
SINGLE FAMILY RESIDENTIAL
DEVELOPMENT AGREEMENT WITH
ANR INDUSTRIES, INCORPORATED
DATE: October 20,2004
()R\G\~~\.
SvnoDsis of Previous Commission/Council/Committee Action(s):
On October 19, 2004, Redevelopment Committee Members Estrada, Longville and McGinnis unanimously voted to
recommend that the Community Development Commission consider this action for approval.
Recommended Motion(s):
(Mavor and Common Council/Communitv DeveloDment Commission)
MOTION:
THAT THE MAYOR AND COMMON COUNCIL AND THE COMMUNITY DEVELOPMENT
COMMISSION SET A JOINT PUBLIC HEARING FOR DECEMBER 6, 2004 TO CONSIDER THE
SALE OF CERTAIN PARCELS IN ACCORDANCE WITH A PROPOSED DEVELOPMENT
AGREEMENT BY AND BETWEEN ANR INDUSTRIES, INe. AND THE REDEVELOPMENT
AGENCY.
Contact Person(s):
Maggie Pacheco
Phone:
(909) 663-1044
Project Area(s)
IVDA
Ward(s):
Supporting Data Attached: 0 Staff Report 0 Resolution(s) 0 Agreement(s)/Contract(s) 0 Map(s) 0 Letters
FUNDING REQUIREMENTS Amount: $
Source:
N/A
Budget Authority:
SIGNATURE:
Commission/Council Notes:
1<e5. J005 -/1
_____r2!!..QL-Z_QQ5..::.i________________________________________________m_____________________m_______________________-------------------------------.
P,\AgendasIComm Dev CommissionlCDC 2004104-11-01 M=Iowbrook SF R"identi.1 Dev. Agmrt. PROOe COMMISSION MEETING AGENDA
Meeting Date: I / 10/0 :s:
Agenda Item Number: ;( 23
.'
,
ECONOMIC DEVELOPMENT AGENCY
STAFF REPORT
SETTING A PUBLIC HEARING TO CONSIDER THE MEADOWBROOK SINGLE
FAMILY RESIDENTIAL DEVELOPMENT AGREEMENT WITH
ANR INDUSTRIES, INCORPORATED
BACKGROUND:
In order to revitalize the neighborhood, on February 3, 2003, the Community Development Commission
approved the Meadowbrook Single Family Residential Grant Development Agreement ("Agreement") with
ANR Industries, Inc. to develop 23 Single-family homes on 22 parcels owned by ANR, including I Agency
owned lot located on Sierra Way, in the area bounded by 2nd Street and Rialto, Sierra Way and Allen Street
(Phase 1) within the Inland Valley Development Agency (IVDA) Project Area ("Project Site"). Pursuant to the
Agreement, the Agency provided ANR with a $500,000 grant in return for ANR developing 23 new homes,
containing about 1400-1700 (3-4 bedrooms) square feet, offering contemporary interpretations of Victorian,
Craftsman and Spanish style homes ("Project"). A ground-breaking was held on August 5, 2004 and
construction has commenced on the 23 homes; 10 homes are anticipated to be completed by November 2004;
10 of the homes have been pre-sold at affordable housing prices to income eligible buyers, and 13 homes will
be sold at market rate prices, ranging in prices of $21 0,000 through $289,000.
Moreover, subsequent to the approval of the above referenced Agreement, the Community Development
Commission and San Bernardino City Housing Authority have authorized the Agency and the Authority, to
acquire 12 additional parcels ("Parcels") (9 vacant rental units, and 3 occupied rental units) within the
boundaries of the Project Site so that the neighborhood revitalization efforts could continue; of the 12 parcels,
the Agency has acquired 8 parcels through negotiations, and 4 parcels are either pending negotiation or the
Authority has commenced condemnation proceedings.
CURRENT ISSUE:
ANR would like to progress with their on going efforts to restore the neighborhood, and has acquired a number
of parcels on their own throughout the area bounded by Sierra Way, Waterman, Rialto and 5th Streets (14
parcels), and they would like to include the purchase of the Parcels from the Agency and developing the
Parcels with similar homes currently under construction in Phase I. Due to the configuration of some of the
parcels, ANR proposes to construct 14 single-family homes on the Parcels. It is proposed that the Parcels be
sold to ANR for the development of 7 affordable homes and 7 market rate homes, selling in comparable prices
to the homes being sold in Phase 1, at an estimated reuse land value of approximately $60,000 per parcel (see
fiscal impact).
However, prior to the proposed sale of the Parcels to ANR, in accordance with Section 33433 of the
Redevelopment Law, the Commission and Council are required to conduct a public hearing at which time, a
proposed Development Agreement will be presented for consideration and approval. It is therefore,
recommended that the Mayor and Common Council and the Community Development Commission set a
public hearing for December 6, 2004.
ENVIRONMENT AL IMPACT:
No environmental analysis is required for setting a public hearing.
P:\Agendas\Conm Dev Commission\CDC 2004\04-11-01 Meadowbrook SF Residential Dev. Agrmt. PH.doc
COMMISSION MEETING AGENDA
Meeting Date:
Agenda Item Number:
Economic Development Agency Staff Report
Meadowbrook SF Residential Development Agreement PH
Page 2
FISCAL IMPACT:
There is no fiscal impact at this time. However, the proposed Development Agreement entails an
estimated expenditure on the part of the Agency or Housing Authority in the approximate amount of
$1.4 million (includes acquisition, relocation, moving, demolition, legal expenses); the anticipated
Fair Market Reuse Value for the Parcels is $719,000.
RECOMMENDA nON:
That the Mayor and Common Council and the Community Development Commission adopt the
recommended Motion.
.~
~l
. -
.. aggle Pac' ..o;Deputy m..cto,
---------------------------------------------------------------------_.----.------------------------------_.--------------------------------------------------------.--------.
P:\Agendas\Comm Dev Commission\CDC 2004\04-11-01 Meadowbrook SF Residential Dev. Agrmt. PRdoc
COMMISSION MEETING AGENDA
Meeting Date:
Agenda Item Number:
ECONOMIC DEVELOPMENT AGENC(}RIGJNAL
OF THE CITY OF SAN BERNARDINO
FROM: Maggie Pacheco
Deputy Director
SUBJECT:
SETTING A PUBLIC HEARING TO
CONSIDER THE MEADOWBROOK
SINGLE FAMILY RESIDENTIAL
DEVELOPMENT AGREEMENT WITH
ANR INDUSTRIES, INCORPORATED
DATE: October 20, 2004
--------------------------------------------------___________________________________n___________________________________________________________________.______________________________________________________
Synopsis of Preyious Commission/Council/Committee Action(s):
On October 19, 2004, Redevelopment Committee Members Estrada, Longville and McGinnis unanimously voted to
recommend that the Community Development Commission consider this action for approval.
---------------------------------------------------------------------------------------------------------------------.------------------------._---------------------------------------------------------------.-
Recommended Motion(s):
(Mayor and Common Council/Community Deyelopment Commission)
MOTION:
THAT THE MAYOR AND COMMON COUNCIL AND THE COMMUNITY DEVELOPMENT
COMMISSION SET A JOINT PUBLIC HEARING FOR DECEMBER 6, 2004 TO CONSIDER THE
SALE OF CERTAIN PARCELS IN ACCORDANCE WITH A PROPOSED DEVELOPMENT
AGREEMENT BY AND BETWEEN ANR INDUSTRIES, INe. AND THE REDEVELOPMENT
AGENCY.
--------------------------------~--~----------------------~---------------------------------------------------------------------------------------~--------------------------------------------------------------
Contact Person(s):
Maggie Pacheco
Phone:
(909) 663-1044
Proj ect Area( s)
IVDA
Ward(s):
Supporting Data Attached: [() Staff Report 0 Resolution(s) 0 Agreement(s)/Contract(s) 0 Map(s) 0 Letters
FUNDING REQUIREMENTS Amount: $
Source:
N/A
Budget Authority:
SIGNATURE:
Commission/Council Notes:
P:\Agendas\Comm Dev Commission\CDC 2004\04-11-01 Meadowbrook SF Residential Dev. Agrmt, PH,doc
COMMISSION MEETING AGENDA
Meeting Date: 11/01/2004
Agenda Item Number: R.3"I-
ECONOMIC DEVELOPMENT AGENCY
STAFF REPORT
---------------------------------------.-------------------------------------------------------------------.--------------------------------------------------------------------------------------------------
SETTING A PUBLIC HEARING TO CONSIDER THE MEADOWBROOK SINGLE
FAMILY RESIDENTIAL DEVELOPMENT AGREEMENT WITH
ANR INDUSTRIES, INCORPORATED
BACKGROUND:
In order to revitalize the neighborhood, on February 3, 2003, the Community Development Commission
approved the Meadowbrook Single Family Residential Grant Development Agreement ("Agreement") with
ANR Industries, Inc. to develop 23 Single-family homes on 22 parcels owned by ANR, including I Agency
owned lot located on Sierra Way, in the area bounded by 2nd Street and Rialto, Sierra Way and Allen Street
(Phase I) within the Inland Valley Development Agency (IVDA) Project Area ("Project Site"). Pursuant to the
Agreement, the Agency provided ANR with a $500,000 grant in return for ANR developing 23 new homes,
containing about 1400-1700 (3-4 bedrooms) square feet, offering contemporary interpretations of Victorian,
Craftsman and Spanish style homes ("Project"). A ground-breaking was held on August 5, 2004 and
construction has commenced on the 23 homes; 10 homes are anticipated to be completed by November 2004;
10 of the homes have been pre-sold at affordable housing prices to income eligible buyers, and 13 homes will
be sold at market rate prices, ranging in prices of $210,000 through $289,000.
Moreover, subsequent to the approval of the above referenced Agreement, the Community Development
Commission and San Bernardino City Housing Authority have authorized the Agency and the Authority, to
acquire 12 additional parcels ("Parcels") (9 vacant rental units, and 3 occupied rental units) within the
boundaries of the Project Site so that the neighborhood revitalization efforts could continue; of the 12 parcels,
the Agency has acquired 8 parcels through negotiations, and 4 parcels are either pending negotiation or the
Authority has commenced condemnation proceedings.
CURRENT ISSUE:
ANR would like to progress with their on going efforts to restore the neighborhood, and has acquired a number
of parcels on their own throughout the area bounded by Sierra Way, Waterman, Rialto and 5th Streets (14
parcels), and they would like to include the purchase of the Parcels from the Agency and developing the
Parcels with similar homes currently under construction in Phase I. Due to the configuration of some of the
parcels, ANR proposes to construct 14 single-family homes on the Parcels. It is proposed that the Parcels be
sold to ANR for the development of 7 affordable homes and 7 market rate homes, selling in comparable prices
to the homes being sold in Phase I, at an estimated reuse land value of approximately $60,000 per parcel (see
fiscal impact).
However, prior to the proposed sale of the Parcels to ANR, in accordance with Section 33433 of the
Redevelopment Law, the Commission and Council are required to conduct a public hearing at which time, a
proposed Development Agreement will be presented for consideration and approval. It is therefore,
recommended that the Mayor and Common Council and the Community Development Commission set a
public hearing for December 6, 2004.
ENVIRONMENTAL IMP ACT:
No environmental analysis is required for setting a public hearing.
P:\Agendas\Comm Dev Commission\CDC 2004\04-11-01 Meadowbrook SF Residential Dev_ Agnnt. PH.doc
COMMISSION MEETING AGENDA
Meeting Date: 11/01/2004
Agenda Item Number: -.R3 'I
Economic Development Agency Staff Report
Meadowbrook SF Residential Development Agreement PH
Page 2
FISCAL IMPACT:
There is no fiscal impact at this time. However, the proposed Development Agreement entails an
estimated expenditure on the part of the Agency or Housing Authority in the approximate amount of
$1.4 million (includes acquisition, relocation, moving, demolition, legal expenses); the anticipated
Fair Market Reuse Value for the Parcels is $719,000.
RECOMMENDATION:
That the Mayor and Common Council and the Community Development Commission adopt the
recommended Motion.
J
~r
aggie Pac eco; Deputy Director
P:\Agendas\Comm Dev Commission\COC 2004\04-1 ] -01 Meadowbrook SF Residential Dev. Agrmt. PH,doc
COMMISSION MEETING AGENDA
Meeting Date: 11/01/2004
Agenda Item Number:
RESOLUTION NO.
(C(Q)\?'1
2
A RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE
CITY OF SAN BERNARDINO APPROVING THE 2005
MEADOWBROOK SINGLE FAMILY RESIDENTIAL DISPOSITION
AND DEVELOPMENT AGREEMENT BY AND BETWEEN THE
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
AND MEADOWBROOK PARK HOMES, INC. (AFFORDABLE
HOUSING DEVELOPMENT - IVDA REDEVELOPMENT PROJECT
AREA)
3
4
5
6
7
WHEREAS, the Redevelopment Agency of the City of San Bernardino ("Agency") is a
public body corporate and politic; and
WHEREAS, the Agency owns eight (8) real properties as follows:
8
9
10
174 N. Allen (APN: 0135-291-18); 168 N. Allen (APN: 0135-291-19); 192 E. King St. (APN:
0135-291-21); 186 E. King St. (APN: 0135-291-22); 199 E. King St. (APN: 0135-292-14); 140
N. Allen St. (APN: 0135-292-15); Vacant (APN: 0135-392-36); and Vacant (APN: 0135-392-
37); and
II
12
13
14
WHREAS, each of the parcels of land identified above is referred to as "Agency Lot"
and collectively these Agency Lots are referred to as the "eight (8) Agency Lots"; and
WHEREAS, the Agency acquired the eight (8) Agency Lots using low- and moderate-
15
16
17
income housing tax increment set-aside funds in the amount of$844,550; and
18
WHEREAS, the Agency proposes to transfer the eight (8) Agency Lots to
19
Meadowbrook Park Homes, Inc., a California corporation (the "Developer") in accordance with
20
the terms and conditions of an agreement entitled "2005 Meadowbrook Single Family
Residential Development Agreement (Meadowbrook Restoration Area)", dated as of January
21
10,2005 (the "2005 Agreement"); and
22
23
WHEREAS, the Developer shall develop and improve each such Agency Lot as may
hereafter be transferred by the Agency to the Developer pursuant to the 2005 Agreement with a
24
New Home, using the design and improvement standards which are consistent with City
25
4815.9755.5968.1
.1.
P '.A&cnd.u\R.csolulaoas\R.noWzaonl-"=:OOS\OS-OI-IO MeadowbrC/lOk Pari. Hamel Mec Jlcso,doc
Development Permit III No. 03-34, as previously approved by the Planning Commission on
2
November 18, 2003 under the 2003 Agreement; and
3
WHEREAS, the Developer has the background, experience and financial capability 0
4
developing the Project and has been successful in securing a construction financial commitmen
5
in support ofthe Project; and
WHEREAS, the Agency has prepared and published a notice of joint public hearing i
The San Bernardino County Sun Newspaper on November 22 and 29, 2004, regarding th
6
7
8
consideration and approval of the 2005 Agreement; and
9
WHEREAS, pursuant to Health and Safety Code Section 33433(c), the Agency
10
transfer the Agency Lots to the Developer subject to the Mayor and Common Council adopting
11
Resolution authorizing the Agency to transfer such Agency Lot in light of the findings set fort
herein, pursuant to Health and Safety Code Section 33433; and
WHEREAS, the Agency has prepared a Summary Report that describes the salient point
of the 2005 Agreement and identifies the cost to the Agency of the disposition of the eight (8
Agency Lots and the development of the Project.
12
13
14
15
16
NOW, THEREFORE, IT IS HEREBY RESOLVED, DETERMINED AND ORDERED
BY THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO AS
FOLLOWS:
17
18
Section 1.
The Recitals of this Resolution are true and correct.
19
Section 2.
On January 10, 2005, the Mayor and Common Council conducted a ful
20
and fair joint public hearing with the Commission, and considered the written Agency staf
report relating to the 2005 Agreement, the Summary Report and the testimony submitted relatin
to the disposition and redevelopment of the Project by the Developer pursuant to the terms an
21
22
23
conditions of the 2005 Agreement. The minutes of the City Clerk for the January 10, 2005, join
public hearing of the City Council and the Commission shall include a record of al
communication and testimony submitted to the City Council and the Commission at the join
24
25
I
I
I
\4815-9755-5968.1 -2-
p \AamdaI\RaoIua...\bsolulllOnl\200S\O~I-IO Mcadowt.uoi.'... Homes MCC Ilcto doc
public hearing by interested persons relating to the Summary Report, the Project and th
2 approval of the 2005 Agreement.
3
Section 3.
This Resolution is adopted in order to satisfy the provisions of Health an
4 Safety Code Section 33433 as those provisions relate to the disposition of the eight (8) Agenc
5 Lots by the Agency to the Developer on the terms and conditions set forth in the 200
6 Agreement. The City Council hereby finds and determines as follows:
7
(i)
The Summary Report contains the information described in Health and Safe
8
Code Section 33433(a)(2)(B);
9
(ii)
The disposition and redevelopment of the eight (8) Agency Lots by the Develope
in accordance with the 2005 Agreement is consistent with the affordable singl
family housing supply preservation and expansion programs of the Agenc
Housing Implementation Plan;
10
II
12
Section 4.
The Mayor and Common Council hereby find and determine that th
13
14
environmental review of the approval of the 2005 Agreement and the redevelopment activitie
contemplated thereunder is a "categorically exempt project" for the reasons indicated in th
Agency Staff Report. No potentially adverse environmental effects are anticipated to b
associated with the redevelopment of the Project.
IS
16
17
Section 5.
The Mayor and Common Council hereby receIve
18
Summary Report and the 2005 Agreement in the form as submitted at this joint public hearing.
19
Section 6.
The Mayor and Common Council hereby approve the disposition of th
20
eight (8) Agency Lots by the Agency to the Developer on the terms set forth in the 200
21
Agreement.
22
Section 7.
The City is not a party to the 2005 Agreement, and nothing in thi
23
Resolution shall be deemed to constitute an approval by the City of any application for
24
development project permit or approval which the Developer may hereafter be required to obtai
25
from the City as a condition precedent to the performance of the Developer's obligation unde
4815-9755-5968.1 -3-
I p ',,^,codas\R.aoIlll~\IlaoIutIODJ\200S\O.5-o 1-10 Mcaaowbrool. '0 Homa MCC Rao doc
the 2005 Agreement with respect to the redevelopment of the Project and/or the construction 0
Section 8.
This Resolution shall take effect upon its adoption and execution in th
2 any New Home on any of the Agency Lots. The City hereby reserves its discretion under al
3 applicable law to approve or reject, and to impose any appropriate condition of its approval 0
4 any such development project permit application as the Developer may hereafter submit to th
5 City in connection with the Project.
6
7 manner as required by the City Charter.
8 II I
9 III
10 III
/ 1.1
11 I I I
12 III
13 III
III
14
III
15
III
16
/II
17
III
18
III
19
III
20
III
21
III
22
III
23 III
24 /II
25
114815-9755-5968.1 -4-
I P 'Aa:mdasl.ltaoluJlOGI\RcsobillOOJ\2005\O~.OI.IO Meadowbrook Pan. Homa MCC Reso doc:
2
A RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE
CITY OF SAN BERNARDINO APPROVING THE 2005
MEADOWBROOK SINGLE FAMIL Y RESIDENTIAL DISPOSITION
AND DEVELOPMENT AGREEMENT BY AND BETWEEN THE
REDEVELOPMENT AGENCY OF THE CITY OF. SAN BERNARDINO
AND MEADOWBROOK PARK HOMES, INC. (AFFORDABLE
HOUSING DEVELOPMENT - IVDA REDEVELOPMENT PROJECT
AREA)
3
4
5
6
I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Mayor and
7 Common Council of the City of San Bernardino at a
meeting thereof, held
, 2005, by the following vote to wit:
Nays
Abstain
Absent
16
17
Rachel G. Clark, City Clerk
18
19
The foregoing resolution is hereby approved this
day of
,2005.
20
21
22
Judith Valles, Mayor
City of San Bernardino
23
Approved as to form and Legal Content:
24
By ~t~;"e: - Pv,~
[,/
25
4815-9755-5968.1 -5-
F 'Af;mdas\RaoIutIOftS\R.csoluttOQ.ll\200'\OS-OI-IO Mc:adowbrODk. Park Hona MCC RcIO doc
RESOLUTION NO. -t ~ lP 1f
2
A RESOLUTION OF THE . COMMUNITY DEVELOPMENT
COMMISSION OF THE CITY OF SAN BERNARDINO APPROVING THE
2005 MEADOWBROOK SINGLE FAMILY RESIDENTIAL DISPOSITION
AND DEVELOPMENT AGREEMENT BY AND BETWEEN THE
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
AND MEADOWBROOK PARK HOMES, INC. (AFFORDABLE HOUSING
DEVELOPMENT - IVDA REDEVELOPMENT PROJECT AREA)
3
4
5
6
7
WHEREAS, the Redevelopment Agency of the City of San Bernardino ("Agency") is a
8
public body corporate and politic; and
WHEREAS, the Agency owns eight (8) real properties as follows:
9
10
174 N. Allen (APN: 0135-291-18); 168 N. Allen (APN: 0135-291-19); 192 E. King S1. (APN:
0135-291-21); 186 E. King S1. (APN: 0135-291-22); 199 E. King S1.(APN: 0135-292-14); 140
N. Allen S1. (APN: 0135-292-15); Vacant (APN: 0135-392-36); and Vacant (APN: 0135-392-
37); and
11
12
13
WHREAS, each of the parcels of land identified above is referred to as "Agency Lot"
and collectively these Agency Lots are referred to as the "eight (8) Agency Lots"; and
WHEREAS, the Agency acquired the eight (8) Agency Lots using 10w- and moderate-
14
15
16
income housing tax increment set-aside funds in the amount of$844,550; and
17
WHEREAS, the Agency proposes to transfer the eight (8) Agency Lots to
18
Meadowbrook Park Homes, Inc., a California corporation (the "Developer") in accordance with
the terms and conditions of an agreement entitled "2005 Meadowbrook Single Family
Residential Development Agreement (Meadowbrook Restoration Area)", dated as of January
19
20
21
10,2005 (the "2005 Agreement"); and
22
WHEREAS, the Developer shall develop and improve each such Agency Lot as may
hereafter be transferred by the Agency to the Developer pursuant to the 2005 Agreement with a
New Home, using the design and improvement standards which are consistent with City
Development Permit III No. 03-34, as previously approved by the Planning Commissio'n on
November 18, 2003 under the 2003 Agreement; and
23
24
25
4815-9755-5968.1
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PAi~ndas\.Resoluhoru;'ksolu.llOns\200~'.os-O 1.10 Meadowbrook. Park. Homes CDC Reso doc
2
WHEREAS, the Developer shall pay the Agency the sum of $30,000 each for the six (6)
Type A Agency Lots and $50,000 for the two (2) Type C Agency Lots. The payment by the
3
Developer for each Agency Lot shall be evidenced by a promissory note secured by a
subordinate construction loan deed of trust on the Agency Lot. Each promissory note is payable
4
5
by the Developer at the time of sale of the Agency Lot to a "Qualified Homebuyer" as defined
in the 2005 Agreement; and
WHEREAS, the Developer has the background, experience and financial capability 0
6
7
8
developing the Project and has been successful in securing a construction financial commitmen
9
in support of the Project; and
10
WHEREAS, the Agency have prepared and published a notice of joint public hearing i
The San Bernardino County Sun Newspaper on November 22 and 29, 2004, regarding th
consideration and approval of the 2005 Agreement; and
11
12
WHEREAS, pursuant to Health and Safety Code Section 33433(c), the Agency
13
14
transfer the Agency Lots to the Developer subject to the Mayor and Common Council and th
Community Development Commission adopting a Resolution authorizing the Agency to transfe
such property in light of the findings set forth herein, pursuant to Health and Safety Code Sectio
15
16
33433; and
17
WHEREAS, the Agency has prepared a Summary Report that describes the salient point
of tbe 2005 Agreement and identifies the cost to the Agency of the disposition of the eight (8
18
19
Agency Lots and the development of the Project.
20
NOW, THEREFORE, THE COMMUNITY DEVELOPMENT COMMISSION OF THE
CITY OF SAN BERNARDINO DOES HEREBY RESOLVE, DETERMINE AND ORDER AS
FOLLOWS:
21
22
23
Section 1.
The Recitals of this Resolution are true and correct.
24
Section 2.
On January 10, 2005; the Community Development Commissio
25 conducted a full and fair joint public hearing with the Mayor and Common Council, an
considered the wrinen Agency staff report relating to the 2005 Agreement, the Summary Repo
48] 5-9755-5968.1 -2-
P 'AacndasJlnowhons\RcsolutlORl\200S\OS.OI.IO Meadowbrook. Park Homes COC Rnodoc
and the testimony submitted relating to the disposition and redevelopment of the Project by th
Developer pursuant to the terms and conditions of the 2005 Agreement. The minutes of the City
2
3
Clerk for the January 10, 2005, joint public hearing of the Community Developmen
4
Commission and the Common Council shall include a record of all communication an
8
Section 3.
This Resolution is adopted in order to satisfy the provisions of Health an
5
testimony submitted to the Community Development Commission and the Common Council a
the joint public hearing by interested persons relating to the Summary Report, the Project and th
6
7
approval of the 2005 Agreement.
9
Safety Code Section 33433 as those provisions relate to the disposition of the eight (8) Agenc
Lots by the Agency to the Developer on the terms and conditions set forth in the 2005
10
Agreement.
11
(i)
12
13
(ii)
The Community Development Commission hereby finds and determines as follows:
The Summary Report contains the information described in Health and Safet
Code Section 33433(a)(2)(B);
14
The disposition and redevelopment of the eight (8) Agency Lots by the Develope
in accordance with the 2005 Agreement is consistent with the affordable singl
15
16
family housing supply preservation and expansion programs of the Agenc
Housing Implementation Plan;
(iii) The terms and conditions of the 2005 Agreement contain assurances that the eigh
17
18
(8) Agency Lots will be redeveloped by the Developer as "New Homes", as thi
19
term is defined in the 2005 Agreement;
20
(iv)
The disposition of the eight (8) Agency Lots to the Developer on the terms se
forth in the 2005 Agreement shall assist in the elimination of conditions of bligh
on the eight (8) Agency Lots and in the Meadowbrook Neighborhood Restoratio
21
22
24
Section 4.
The Community Development Commission hereby find and determin
23
Area;
25 that the environmental review of the approval of the 2005 Agreement and the redevelopmen
activities contemplated thereunder is a "categorically exempt project" for the reasons indicated i
~8 15-9755-5968,1 -3-
P '.....enQas\RcsolullOns.R.esolullOns\lOO~\O}..Ol.10 Meadowt.ook Pan. Homes coc R.eso doc
the Agency Staff Report. No potentially adverse environmental effects are anticipated to b
2 associated with the redevelopment of the Project, and accordingly based upon its ow
3 independent review of the information provided to the Community Development Commissio
6
Section 5.
The Community Development Commission hereby receive and approv
4 regarding the Project, the Community Development Commission hereby authorizes the filing 0
5 a Notice of Exemption under CEQA relating to the Project.
7
the Summary Report and the 2005 Agreement in the form as submitted at this joint publi
hearing.
8
9
Section 6.
The Community Development Commission hereby approve th
10
disposition of the eight (8) Agency Lots by the Agency to the Developer on the terms set forth i
11
the 2005 Agreement and hereby authorize the Executive Director to execute the Agreement 0
behalf of the Agency and the Executive Director of the Agency is hereby authorized to mak
12
minor corrections, additions, clarifications, interpretations to the Agreement, provided sai
13
changes are not substantive in nature, do not increase the monetary impact to the Agency and ar
14
consented to by the Agency Counsel.
15
Section 7.
16
/1/
17
//1
18 /1/
19 /1/
20 /1/
21 /1/
22 //1
23 /1/
24 /1/
25 /1/
This Resolution shall take effect upon its adoption and execution.
4815-9755-5968.1
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2
A RESOLUTION OF THE COMMUNITY DEVELOPMENT
COMMISSION OF THE CITY OF SAN BERNARDINO APPROVING THE
2005 MEADOWBROOK SINGLE FAMILY RESIDENTIAL DISPOSITION
AND DEVELOPMENT AGREEMENT BY AND BETWEEN THE
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
AND MEADOWBROOK PARK HOMES, INC. (AFFORDABLE HOUSING
DEVELOPMENT - IVDA REDEVELOPMENT PROJECT AREA)
3
4
5
I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Communit
6
Development Commission of the City QfSan Bernardino at a
meeting thereof, held
7
on the day of
8
Commission Members:
9 ESTRADA
10 LONGVILLE
11 MCGINNIS
12 DERRY
13 KELLEY
14 JOHNSON
MC CAMMACK
, 2005, by the following vote to wit:
Ayes
Nays
Abstain
Absent
15
16
17
Secretary
18 The foregoing resolution is hereby approved this
19
day of
,2005.
20
Judith Valles, Chairperson
Community Development Commission
of the City of San Bernardino
21
22
Approved as to form and Legal Content:
23
By:
~ }. p~
. y Attorney
24
25
4815-9755-5968.1 -5-
p IA&cndaI~kdlOQl\Jlesolu1lORS\200S\OS-OI.IO Meadowbrook Park Hona COC Rao doc
SUMMARY REPORT PURSUANT TO HEALTH AND SAFETY CODE SECTION 33433
OF THE CALIFORNIA COMMUNITY REDEVELOPMENT LAW - REGARDING
THE DEVELOPMENT AND DISPOSITION OF CERTAIN AGENCY OWNED
PROPERTIES PURSUANT TO THE TERMS OF THE 'MEADOWBROOK SINGLE-
FAMILY RESIDENTIAL DISPOSITION AND DEVELOPMENT AGREEMENT BY
AND BETWEEN THE REDEVELOPMENT AGENCY AND MEADOWBROOK PARK
HOMES, INC., IN THE MEADOWBROOK NEIGHBORHOOD
INTRODUCTION
This Summary Report (the "Report") has been prepared by the Redevelopment Agency of the
City of San Bernardino (the "Agency") in accordance with Health and Safety Code Section
33433. This Report sets forth certain details of the 2005 Meadowbrook Single-Family
Residential Disposition and Development Agreement (the "2005 Agreement") by and between
Meadowbrook Park Homes, Inc., a California corporation (the "Developer") and the Agency.
The 2005 Agreement provides for the disposition of certain Agency-owned lands to _the
Developer for redevelopment as new single-family dwellings. The new housing development
project, which may be undertaken by the Developer, is referred to in the 2005 Agreement as the
"Project". In other written reports and materials relating to the Project, the new housing
development activities of the Developer are also referred to as the "Phase IA Project".
The following Agency-owned lands are affected by the 2005 Agreement:
Agency Lot Address APN Number Approximate Size
of Agency Lot
174 N. Allen St. 0135-291-18 6,750 Sq. ft
168 N. Allen St. 0135-291-19 6,750 sq. ft
192 E. King St. 0135-291-21 4,500 sq. ft
186 E. King St. 0135-291-22 6,750 sq. ft
199 E. King St. 0135-292-14 6,750 sq. ft
140 N. Allen St. 0135-292-15 6,750 sq. ft
Vacant Lot on N. Allen St. 0135-302-36 6,750 sq. ft
Vacant Lot on N. Allen St. 0135-302-37 6,750 sq. ft
A. SALIENT POINTS OF THE 2005 AGREEMENT
. The purpose of the 2005 Agreement is to facilitate the development of eight (8)'
single- family homes in the Meadowbrook Neighborhood. Each such New Home
will have three to four bedrooms and an attached 2-car garage containing
approximately between 1,500-1,850 square feet of interior living area. All
necessary infrastructure improvements such as electricity, sewers, gutter,
landscaping will be provided by the Developer. The exterior elevations of the
New Homes will vary but in gerieral, all elevations and floor plans will be similar
to the other new homes being constructed nearby by ANR Industries, Inc. These
other new homes are being constructed in accordance with City DP III, No. 03-04
4811-4371-9168.1 1
p- \Aacndas\Aacnda Attadunmts\SurrI'Nf"Y Reporu\200S\Os"{) I-I 0 Mcadowtrook Park Swnnary Repon.doc:
pursuant to the previous Agency and ANR Industries Agreement. The Agency's
expenditure estimate is as follows:
Agency Developer Estimated Estimated Estimated
Acquisition Acquisition Relocation Moving Demolition
Property Address APN# Cost Cost Cost EXDenses Cost
174 N. Allen St.** 0135-291-18 $100,000 $30,000 $0 $0 $10,000
168 N. Allen St. ** 0135-291-19 $100,000 $30,000 $0 $0 $10,000
192 E. King St. ** 0135-291-21 $138,000 $30,000 $0 $0 $10,000
186 E. King St. ** 0135-291-22 $100,000 $30,000 $25,000 $1,550 $10,000
199 E. King St. ** 0135-292-14 $136,000 $30,000 $0 $0 $10,000
140 N. Allen St**. 0135-292-15 $125,000 $30,000 $0 $0 $10,000
Vacant on N. Allen St. 0135-302-36 $28,900 $50,000 0 0 0
Vacant on N. Allen St. 0135-302-37 $30,100 $50,000 0 0 0
Sub Totals $758,000* $280,000 $25,000* $1,550* $60,000*
Total $844,550*
*
**
Expenses that add up to the $844,550 total
Improved Agency Lots
. Under state law, the Agency is authorized to transfer property to third party
developers for redevelopment of new homes to be specially reserved for
occupancy by 10w- and moderate-income households ("Qualified Homebuyers")
and to provide affordable housing opportunities consistent with the provisions of
the Redevelopment Plan for Inland Valley Redevelopment Project Area (IVDA).
. The Developer is related to ANR Industries, Inc., and the principals with the
Developer have a proven background, experience, and financial capability of
developing new homes in the San Bernardino County.
B. COST OF THE PROJECT AND THE 2005 AGREEMENT TO THE AGENCY
This Section outlines the total costs of the Phase IA Project to the Agency, including, but
not limited to land acquisition costs, clearance costs and relocation costs.
As stated above, the Agency has expended or will expend $844,550 for the acquisition of
the eight (8) Agency Lots, relocation of the one occupant and the demolition of six (6)
improved Agency substandard Lots. Two (2) Agency Lots on Allen Street are vacant.
The Agency will transfer the eight (8) Agency Lots to the Developer for the construction
of single family homes, out of which six (6) homes will provide affordable housing
opportunities to moderate income households and two (2) homes sold at market rate
housing prices. It is anticipated that the Developer will pay $30,000 each for th.e six
Type A Agency Lot ($180,000) and $50,000 each for the two Type C Agency Lot
t$100,000) for a total sales price of $280,000. The payment by the Developer for the
4811-4371-9168.1
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p l.A&endas\Aacnda Anachmenu\Swm'I8f"Y Repons\200S\O'-Ot-IO Meadowbrook Park Sunnary Repon.doc
Agency Lots shall be evidenced by a promissory note secured by a subordinate deed of
trust to a construction loan on the Agency Lot. Each promissory note is payable by the
Developer at the time the Developer sells the Agency Lot to a "Qualified Homt:buyer".
No interest accrues on the promissory note during the first eighteen (18) months for the
six (6) Type A Agency Lots; after that date, the rate of interest is 6% per annum until
paid. The payment by the Developer to the Agency for the 2 Type C Agency Lots is
deferred until the Developer sells the Type C Agency Lot to the Developer's Buyer, but
interest begins accruing immediately upon conveyance of the Type C Agency Lot to the
Developer.
The Agency further intends to allocate the sum of $500,000 to the project to provide the
Qualified Homebuyers with down payment/closing costs assistance of up to 20% of the
purchase price of the homes; therefore, the total Agency cost of the 2005 Agreement is
$1,064,550 after the developer has paid $280,000 land value to the Agency for the eight
(8) Agency Lots.
C. ESTIMATED VALUE OF THE INTEREST TO BE CONVEYED BY THE
AGENCY DETERMINED AT THE HIGHEST AND BEST USES PERMITTED
UNDER THE REDEVELOPMENT PLAN: AND ESTIMATED VALUE OF THE
INTEREST TO BE CONVEYED BASED ON THE REOUIRED REUSE AND
WITH THE CONDITIONS. COVENANTS AND RESTRICTIONS REQUIRED
The estimated value of each Agency Type A Lot is $30,000. The value was established
through affordability analysis of cost supported by comparable sales in the area. The
value on the two (2) unrestricted Type C Agency Lot is $50,000 each, which is
considered to be more than the fair market value of comparable land sale in the area.
The sale of the Agency Lots is necessary to facilitate the implementation of the
Redevelopment Plan for the Inland Valley Redevelopment Project Area (NDA), which
obligates the Agency to insure that affordable housing opportunities are made available to
all project area residents.
In conclusion, the interest to be conveyed to Developer has been determined to be the
highest and best use permitted under the IVDA Redevelopment Plan and holds true for
the reuse value, considering a portion of the Project is subject to conditions, covenants
and restrictions placed by the Agency per the 2005 Agreement. The interest and land
conveyed to the Developer will be developed in conformance with the City's General
Plan and Housing Element, Municipal Development Code, and Agency's AB 1290
Implementation Plan.
4811-4371-9168.1
3
P lA&endas\Ajcoda _IS......-y R_I2OOS>05-<lI.\O Mcodow_ Pori< S......-y Rcpon.do<
2005
MEADOWBROOK SINGLE FAMILY
RESIDENTIAL DEVELOPMENT AGREEMENT
(Meadowbrook Neighborhood Restoration Area)
THIS 2005 MEADOWBROOK SINGLE FAMILY RESIDENTIAL
DEVELOPMENT AGREEMENT (this "Agreement") is dated as of January 10, 2005, by and
between the REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO, a public
body corporate and politic (the "Agency") and MEADOWBROOK PARK HOMES, INC., a
California corporation (the "Developer") in light of the facts set forth in the following paragraphs
of the Recitals:
RECITALS
As of the "Effective Date" of this Agreement (as this term is defined below), the Agency
owns certain properties described as follows:
Agency Lot Address
APN Number
174 N. Allen
168 N. Allen
192 E. King S1.
186 E. King S1.
199 E. King S1.
140 N. Allen S1.
Vacant (Allen S1.)
Vacant (Allen S1.)
0135-291-18
0135-291-19
0135-291-21
0135-291-22
0135-292-14
0135-292-15
0135-302-36
0135-302-37
Each of the Agency-owned parcels of land identified in the table in the preceding
paragraph is referred to in this Agreement as an "Agency Lot"; and
The Agency acquired each such Agency Lots using low and moderate income housing
tax increment set-aside funds; and
The Agency proposes to transfer the Agency Lots to the Developer in accordance with
the terms and conditions of this Agreement; and
The Developer shall develop and improve each such Agency Lot as may hereafter be
transferred by the Agency to the Developer pursuant to this Agreement with a New Home; and
Each of the Agency Lots as may hereafter be transferred to the Developer by the Agency
under this Agreement shall be developed and improved with New Homes by the Developer
under design and improvement standards which are consistent with City Development Permit III
No. 03-34, as previously approved by the Planning Commission on November 18, 2003, and
such further separate review and approval by the City of the specific plan of improvement of
each Agency Lot by the Developer as may hereafter be indicated; and
4853-1265-2544.6
1
1/3/05
P'>AaenduIAac:nQa An.aehrnrnu\AamU-Amend 200S\DS-Ol-IO ANR-200S Meadowbrook ODA,doc;:
The Developer has the background, experience and financial capability of developing the
Project as hereinafter described and appears well qualified to secure a construction financial
commitment from a commercial lending institution in support of the Project; and
Pursuant to Health and Safety Code Section 33433(c), the Agency may transfer the
Agency Lots to the Developer subject to the Mayor and Common Council adopting a Resolution
authorizing the Agency to transfer to the Developer such property with regard to the findings
required to be made as set forth in Health and Safety Code Section 33433; and
NOW, THEREFORE, FOR GOOD AND VALUABLE CONSIDERATION, THE
RECEIPT AND SUFFICIENCY OF WHICH IS HEREBY ACKNOWLEDGED, THE
AGENCY AND THE DEVELOPER HEREBY AGREE AS FOLLOWS:
ARTICLE I
TERMS AND CONDITIONS
Section 1.01. Integration of All Agreements Relating to the Proiect and
Definition of Terms.
(a) This Agreement integrates all of the terms and conditions mentioned herein and
supercedes all negotiations, discussions, and understandings between the parties with respect to
the Project and all items of assistance, which the Agency may hereafter provide to the
Developer.
(b) In addition to the words, which have defined meanings as set forth in the
preceding paragraphs of this Agreement, certain other phrases or terms as used in this Agreement
shall have the meaning set forth as follows:
Adjusted Family Income. The words "Adjusted Family Income" mean the anticipated
total annual income (adjusted for family size) of each individual or family residing or
treated as residing in the New Home as calculated in accordance with Treasury
Regulation 1.l67(k) - 3b)(3) under the Code, as adjusted, based upon family size in
accordance with the household income adjustment factors adjusted and amended from
time to time, pursuant to Section 8 of the United States Housing Act of 1937, as
amended.
Affordable Housing Cost. The words "Affordable Housing Cost" shall have the
meaning as set forth in Health and Safety Code Section 50052.5, as this section may
hereafter be amended from time-to-time by the State of California. A Qualified
Homebuyer, and/or the Successor-In-Interest of such Qualified Homebuyer, if any, shall
pay no more than an Affordable Housing Cost as its purchase price for the New Home as
of the applicable Delivery Date.
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Agency Downpayment Assistance. The words "Agency Downpayment Assistance"
mean and refer to the purchase money financial assistance, which the Agency shall
provide to Qualified Homebuyers of New Homes constructed on Type A Agency Lots
and on Type B Agency Lots. The amount of such Agency Downpayment Assistance in
favor of a particular Qualified Homebuyer shall not exceed twenty percent (20%) of the
purchase price payable by the Qualified Homebuyer for the New Home, and shall be
further subject to the Agency Low and Moderate Income Housing Fund mortgage
underwriting criteria and standards.
Agency Lot. The words "Agency Lot" means and refers to any parcel of property, which
is both: (i) owned or acquired by the Agency; and (ii) made available for transfer to the
Developer under the terms and conditions of this Agreement. Each Agency Lot which
may hereafter be made available by the Agency for transfer to the Developer shall be
specifically identified in a Notice of Availability for Transfer prepared by the Agency
and issued to the Developer. As the term "Agency Lot" is used in this Agreement, the
words may refer to a Type A Agency Lot, or a Type B Agency Lot or a Type C Agency
Lot, as applicable.
Agency Lot Escrow Holder. The words "Agency Lot Escrow Holder" shall be the
escrow company designated by the Agency in the Notice of Availability for Transfer who
shall serve as the escrow holder under the Agency Lot Transfer Escrow for each of the
Agency Lot(s) identified in such Notice of Availability for Transfer.
Agency Lot Purchase Price. The words "Agency Lot Purchase Price" mean and refer to
the sum payable by the Developer to the Agency for the purchase of each Agency Lot as
may hereafter be transferred to the Developer upon the close of each Agency Lot
Transfer Escrow. The Agency Lot Purchase Price for each Agency Lot transferred to the
Developer shall be as follows:
(i) for a Type A Agency Lot, the Agency Lot Purchase Price shall be the
amount determined as provided in Section 2.15(b);
(ii) for a Type B Agency Lot, the Agency Lot Purchase Price shall be the
amount determined as provided in Section 2.15( c); and
(iii) for a Type C Agency Lot, the Agency Lot Purchase Price shall be the
greater of $50,000 or the fair market value of such Agency Lot determined
as provided in Section 2.15( d).
Agency Lot Transfer Escrow. The words "Agency Lot Transfer Escrow" mean and
refer to each escrow transaction as may hereafter be opened by the Agency and the
Developer for the transfer of one or more Agency Lots from the Agency to the
Developer. No Agency Lot Transfer Escrow shall be deemed to be opened until such
time as the Agency Lot Escrow Holder has received from the Agency a Notice of
Availability for Transfer for the Agency Lot(s) subject to such Agency Lot Transfer
Escrow, which has been accepted in writing by the Developer.
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Agency Low and Moderate Income Housing Fund. The words "Agency Low and
Moderate Income Housing Fund" mean and refer to the special affordable housing fund
established by the Agency for each of its redevelopment project areas in accordance with
the provisions of Health and Safety Code Section 33334. The Agency either has acquired
or shall hereafter acquire Agency Lots within the Neighborhood Restoration Area solely
from amounts on deposit with the Agency Low and Moderate Income Housing Fund.
The sole source of funds which is available for the acquisition of Agency Lots is the
Agency Low and Moderate Income Housing Fund, and no other source of funds. The
Agency may, but is under no obligation to do so, use other available funds, if any, to
acquire Type C Agency Lots.
Completed New Home Purchase Price. The words "Completed New Home Purchase
Price" mean and refer to the applicable purchase price payable by the Qualified
Homebuyer to the Developer for the purchase of each Completed New Home at the close
of the applicable New Home Escrow. The Completed New Home Purchase Price for a
New Home Constructed on a Type A Agency Lot shall be an amount which does not
exceed a sum which is payable by the Qualified Homebuyer at the time of close of the
New Home Escrow as an Affordable Housing Cost for a Moderate Income Household.
The Completed New Home Purchase Price for a New Home constructed on a Type B
Agency Lot shall be an amount which does not exceed a sum which is payable by the
Qualified Homebuyer at the time of close of the New Home Escrow as an Affordable
Housing Cost for a Low Income Household.
Completed New Home. The words "Completed New Home" mean and refer to each
new single family residential unit to be designed, constructed and improved by the
Developer on each Agency Lot. Each Completed New Home constructed on a Type A
Agency Lot or a Type B Agency Lot shall be reserved and made available for sale and
occupancy by a Qualified Homebuyer designated by the Developer.
Delivery Date. The words "Delivery Date" mean the close of a New Home Escrow for a
particular New Home following its completion, or in other words, on the Delivery Date,
title and possession of a completed New Home on an Agency Lot shall be delivered by
the Developer to the Qualified Homebuyer at the close of the New Home Escrow.
Due Diligence Period. The words "Due Diligence Period" refers to the sixty (60) day
period of time following the date of the issuance by the Agency of a Notice of
Availability for Transfer of Agency Lot, during which the Developer shall undertake and
complete such due diligence investigation of the condition of each Agency Lot identified
in such Notice of Availability for Transfer of Agency Lot as the Developer may in its
sole discretion and responsibility undertaken with respect to each such Agency Lot.
Effective Date. The words "Effective Date" mean and refer to the date on which this
Agreement has been fully executed by the officers or representatives of the parties
following an approving majority vote of the members of the governing board of the
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Agency authorizing the execution of this Agreement by the Agency and the conditions of
Section 1.05 have been satisfied.
Environmental Laws. The words "Environmental Laws" mean all federal, state, local,
or municipal laws, rules, orders, regulations, statutes, ordinances, codes, decrees, or
requirements of any government authority regulating, relating to, or imposing liability of
standards of conduct concerning any hazardous substance (as later defined), or pertaimng
to occupational health or industrial hygiene (and only to the extent that the occupational
health or industrial hygiene laws, ordinances, or regulations relate to hazardous
substances on, under, or about the Site), occupational or environmental conditions on,
under, or about the Site or Sales Office, as now or may at any later time be in effect,
including without limitation, the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 ("CERCLA") [42 USC Section 9601 et seq.];
the Resource Conservation and Recovery Act of 1976 ("RCRA") [42 USC Section 6901
et seq.]; the Clean Water Act, also known as the Federal Water Pollution Control Act
("FWPCA") [33 USC Section 1251 et seq.]; the Toxic Substances Control Act ("TSCA")
[15 USC Section 2601 et seq.]; the Hazardous Materials Transportation Act ("HMTA")
[49 USC Section 1801 et seq.]; the Insecticide, Fungicide, Rodenticide Act [7 USC
Section 6901 et seq.] the Clean Air Act [42 USC Section 7401 et seq.]; the Safe Drinking
Water Act [42 USC Section 300fet seq.]; the Solid Waste Disposal Act [42 USC Section
6901 et seq.]; the Surface Mining Control and Reclamation Act [30 USC Section 101 et
seq.] the Emergency Planning and Community Right to Know Act [42 USC Section
11001 et seq.]; the Occupational Safety and Health Act [29 USC Section 655 and 657];
the California Underground Storage of Hazardous Substances Act [H & S C Section
25288 et seq.]; the California Hazardous Substances Account Act [H & S C Section
25300 et seq.]; the California Safe Drinking Water and Toxic Enforcement Act [H & S C
Section 24249.5 et seq.] the Porter-Cologne Water Quality Act [Water Code Section
13000 et seq.] together with any amendments of or regulations promulgated under the
statutes cited above and any other federal, state, or local law, statute, ordinance, or
regulation now in effect or later enacted that pertains to occupational health or industrial
hygiene, and only to the extent the occupational health or industrial hygiene laws,
ordinances, or regulations relate to hazardous substances on, under, or about the Site, or
the regulation or protection of the environment, including ambient air, soil, soil vapor,
groundwater, surface water, or land use.
Hazardous Substances. The words "Hazardous Substances" mean and include without
limitation:
those substances included within the definiteness of "hazardous substance,"
"hazardous waste," "hazardous material", "toxic substance", "solid waste," or
"pollutant or contaminate" in CERCLA, RCRA, TSCA, HMT A, or under any
other environmental law; and
those substances listed in the United States Department of Transportation
(DOT)Table [49 CFR 172.101], or by the EPA, or any successor agency, as
hazardous substances [40 CFR Part 302]; and
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other substances, materials, and wastes that are or become regulated or classified
as hazardous or toxic under federal, state, or local laws or regulations; and
any material, waste, or substance that is:
(1) a petroleum or refined petroleum product,
(2) asbestos,
(3) polychlorinated biphenyl,
(4) designated as a hazardous substance pursuant to 33 USC Section
1321 or listed pursuant to 33 USC Section 1317,
(5) a flammable explosive, or
(6) a radioactive material.
Low Income Household. The words "Low Income Household" mean and refer to
persons and families whose Adjustment Family Income at the time of close of a New
Home Escrow does not exceed eighty percent (80%) of the area median income of the
City determined by the State Department of Housing and Community Development 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, as amended, and Health and Safety Code Section
50093, as this section may be hereafter amended from time to time by the State of
California.
Moderate Income Household. The words "Moderate Income Household" mean persons
and families whose Adjusted Family Income at the time of the close of a New Home
Escrow does not exceed one hundred and twenty percent (120%) of the area median
income of the City determined by the State Department of Housing and Community
Development 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, as amended, and Health and Safety
Code Section 50093, as this section may hereafter be amended from time-to-time by the
State of California.
Neighborhood Restoration Area. The words "Neighborhood Restoration Area" mean
and refer to the lands identified in the vicinity map attached to this Agreement as Exhibit
"'A",
New Home. The words "New Home" mean and refer to each of the completed single-
family residential dwelling units (including the land and landscape improvements
thereon) as shall be constructed and installed by the Developer on each Type A Agency
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Lot and Type B Agency Lot, as applicable. The words "New Home" do not apply to the
single family residential improvements constructed on any Type C Agency Lot following
the close of an Agency Lot Transfer Escrow for a Type C Agency Lot.
New Home Escrow. The words "New Home Escrow" mean and refer to the real estate
conveyance transaction or escrow by and between the Developer and the Qualified
Homebuyer (or later, by and between the Qualified Homebuyer and the Successor-In-
Interest) for the conveyance and sale of the New Home. The transfer of each New Home
from the Developer to a Qualified Homebuyer (or later, by and between the Qualified
Homebuyer and the Successor-In-Interest) shall be accomplished upon the close of the
New Home Escrow.
New Home Escrow Holder. The words "New Home Escrow Holder" mean and refer to
the escrow company designated by the Developer who shall serve as the escrow holder
under the New Home Escrow by and among such New Home Escrow Holder, the
Developer and a Qualified Homebuyer for the transfer and sale by the Developer of the
completed New Home on an Agency Lot to such Qualified Homebuyer.
New Home Sales Costs. The words "New Home Sales Costs" mean and refer to the
actual and reasonable costs incurred by the Developer in the acquisition, development,
improvement and sale to a Qualified Homebuyer, as enumerated below in subparagraphs
(1) through (10), inclusive, of each Completed New Home on each Type A Agency Lot
and on each Type B Agency Lot. Within sixty (60) days following the close of each New
Home Escrow for the sale by the Developer of a Completed New Home or a Type A
Agency Lot and/or Type B Agency Lot, the Developer shall provide the Agency with a
suitably detailed written accounting (e.g., the New Home Sale Costs Certificate) of the
New Home Sale Costs for the particular Completed New Home. New Home Sale Costs
for each Completed New Home include each of the following:
(1) the Agency Lot Purchase Price, plus the actual and reasonable escrow and title
insurance costs paid by the Developer for the purchase of the Agency Lot through
the Agency Lot Transfer Escrow;
(2) the cost of preparing the Agency Lot for improvement, including demolition
expenses, if any paid by the Developer, grading, and all off-site costs incurred in
connection with the improvement of the Agency Lot, including utility connection
charges and adjacent public right-of-way improvements, if any;
(3) architectural, engineering, legal, accounting, consulting and other professional
service fees paid in connection with the planning, execution and financing of the
Project as allocated to the Agency Lot;
(4) the cost allocated to the Agency Lot of insurance, construction lender financing
charges, points and fees, construction loan interest, surety and completion bonds,
property taxes, assessments as incurred and paid by the Developer between the
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time of the Transfer Date for the Agency Lot to the Delivery Date for the Agency
Lot;
(5) the cost of construction materials, equipment and furnishings installed in the
Completed New Home and the cost of labor to so construct and install the
Completed New Home, and the cost of the Completed New Home on the Agency
Lot, all building permits, public school fees, and other regulatory agency charges
and the cost of landscaping and fencing as installed and constructed on the
Completed New Home;
(6) the cost allocated to the Agency Lot of construction supervision costs and private
security patrol services incurred by the Developer in connection with the New
Home;
(7) New Home sales, marketing and commissions payable at the Delivery Date of the
Completed New Home of six percent (6%) of the gross sales price of the
Completed New Home on the Agency Lot;
(8) New Home Escrow closing costs paid by the Developer at the Delivery Date for
the Completed New Home;
(9) a Developer overhead fee offive percent (5%) of the cost items under (2), (3), (5)
and (6), above; and
(10) a Developer profit allowance of ten percent (10%) of the gross sales price of the
Completed New Home on the Agency Lot.
New Home Sale Costs Certificate. The words "New Home Sale Costs Certificate"
mean and refer to the written accounting and cost certification prepared by the Developer
and submitted to the Agency not later than sixty (60) days following the close of each
New Home Escrow for a Completed New Home Constructed on a Type A Agency Lot
and/or a Type B Agency Lot. Each New Home Sales Costs Certificate shall contain a
suitably detailed description of the costs and expenses allocated to the Completed New
Home on such Agency Lot as the New Home Sales Costs.
Notice of Agency Concurrence. The words "Notice of Agency Concurrence" mean and
refer to the acknowledgment executed by the Executive Director of the Agency and
delivered to the holder of the New Home Escrow. in which thc Agency confirms that the
proposed Qualified Homebuyer, appears to satisfy all of the Adjusted Family Income and
other requirements of the Section 33334.3 Covenant for occupancy of the New Home.
Notice of Availability for Transfer. The words "Notice of Availability for Transfer"
mean and refer to the written notice which the Agency may hereafter deliver to the
Developer from time to time, in which the Agency gives notice that one or more Agency
Lots are available for transfer to Developer subject to the terms and conditions of this
Agreement. The Notice of Availability for Transfer shall indicate that the Agency Lot is
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offered for transfer to the Developer as a Type A Agency Lot, Type B Agency Lot and/or
Type C Agency Lot, as applicable, and each Notice of Availability for Transfer shall be
accompanied with a preliminary title report for each Agency Lot identified thereon. The
general form of a Notice of Availability for Transfer is attached to this Agreement as
Exhibit "B". Each Notice of Availability of Transfer shall contain such other information
relating to the Agency Lot(s) identified thereon, as may then be appropriate, as provided
under this Agreement.
Project. The word "Project" means and refers to the redevelopment and sale by the
Developer to the Qualified Homebuyer of each Agency Lot which is offered to the
Developer by the Agency for transfer and redevelopment under this Agreement as
evidenced by a Notice of Availability for Transfer. The Project is more particularly
described in the Scope of Development attached as Exhibit "F". The Project shall be
undertaken by the Developer in accordance with the dates set forth in the Schedule of
Performance attached as Exhibit "0".
Qualified Homebuyer. The words "Qualified Homebuyer" mean the purchasers of each
of the New Homes from the Developer (e.g.: all persons identified as having a property
ownership interest vested in the New Home as of the close of the New Home Escrow).
At the close of each New Home Escrow, the Qualified Homebuyer shall: (i) in the case of
a Type A Agency Lot have an annual Adjusted Family Income which does not exceed the
household income qualification limits of a Moderate Income Household; (ii) in the case
of a Type B Agency Lot have an annual Adjusted Family Income which does not exceed
the household income qualification limits of a Lower-Income Household; and (iii) in
either the case of a Type A Agency Lot or a Type B Agency Lot the Qualified
Homebuyer shall pay no more than an Affordable Housing Cost for the New Home
pursuant to the terms of the purchase transaction for the New Home, including all sums
payable by the Qualified Homebuyer for its purchase money mortgage financing,
insurance, escrow and other fees and costs. In the case of a Type C Agency Lot a
Qualified Homebuyer shall be any person or family who shall certify its intention to live
in the New Home as a principal residence for at least two (2) years following the date of
the Close of the New Home Escrow.
Qualified Residence Period. The words "Qualified Residence Period" mean in the case
of each New Home constructed on either a Type A Agency Lot or a Type B Agency Lot,
the period of time beginning on the Delivery Date and ending on the date which is forty-
five (45) years after the Delivery Date.
Real Estate Sales and Marketing Work. The words "Real Estate Sales and Marketing
Work" refer to the services to be provided by the Developer relating to the marketing of
each New Home for sale to a Qualified Homebuyer. The Real Estate Sales and
Marketing Work includes without limitation the presentation of each New Home to one
or more Qualified Homebuyers for the purpose of causing a Qualified Homebuyer to
purchase the New Home constructed on an Agency Lot from the Developer.
Section 33334.3 Covenant. The words "Section 33334.3 Covenant" mean the
Redevelopment Agency of the City of San Bernardino Community Redevelopment
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Housing Affordability Covenants and Restrictions by and among the Qualified
Homebuyer, the Developer and the Agency pertaining to the New Home. A Section
33334.3 Covenant in appropriate final form, shall be recorded concurrently with the close
of each New Home Escrow for the sale of a completed New Home on either a Type A
Agency Lot or a Type B Agency Lot.
Type A Agency Lot. The words "Type A Agency Lot" means and refers to an Agency
Lot which the Agency has designated in its Notice of Availability for Transfer, as a
"Type A Agency Lot". A Type A Agency Lot shall, upon its transfer to the Developer,
be reserved for construction and improvement by the Developer with a New Home, and a
Type A Agency Lot shall, upon completion of the improvement of a New Home thereon,
be reserved for sale and occupancy by a Qualified Homebuyer whose Adjusted Family
Income at the time of the close of the New Home Escrow for such Agency Lot, shall be
no more than such annual income limit for a Moderate Income Household.
Type B Agency Lot. The words "Type B Agency Lot" means and refers to an Agency
Lot which the Agency has designated in its Notice of Availability for Transfer, as a Type
B Agency Lot. A Type B Agency Lot shall, upon its transfer to the Developer, be
reserved for construction and improvement by the Developer with a New Home, and a
Type B Agency Lot shall, upon completion of the improvement of a New Home thereon,
be reserved for sale and occupancy by a Qualified Homebuyer whose Adjusted Family
Income at the time of a close of the New Home Escrow for such Agency Lot, shall be no
more than such annual income limit for a Low Income Household.
Type C Agency Lot. The words "Type C Agency Lot" mean and refer to an Agency Lot
which the Agency has designated in its Notice of Availability for Transfer, as a Type C
Agency Lot. A Type C Agency Lot shall upon its transfer to the Developer, be reserved
for construction and improvement by the Developer with a New Home. However, upon
its completion, a New Home constructed on a Type C Agency Lot shall not be subject to
the Affordable Housing Cost sale and occupancy provisions of any Section 33334
Covenant.
Section 1.02. Parties to the Agreement.
(a) The Agencv. The Agency is a public body, corporate and politic,
exercising governmental functions and powers and organized and existing under Chapter 2 of the
Community Redevelopment Law. of the State of California (Health and Safety Code Section
33000, et sea.) The principal office of the Agency is located at 201 North "E" Street, Suite 301,
San Bernardino, California 92401.
(b) The Developer. The Developer is Meadowbrook Park Homes, Inc., a
California corporation. The principal office and mailing address of the Developer for purposes
of this Agreement is: 10702 Hathaway Drive, Suite No.1, Santa Fe Springs, California 90607.
Section 1.03. Prohibition Against Change in Ownership. Management and
Control of Developer and Assignment of Agreement. The qualifications and identity of the
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Developer are of particular concern to 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.
Except as set forth in Section 3.03, prior to the Release Date the Developer shall
not assign all or any part of this Agreement, or any rights hereunder, without the prior written
approval of the Agency Executive Director, which approval shall not be unreasonably
conditioned, withheld or delayed.
The Developer shall promptly notify the Agency in wntmg of any material
change in the identity of the parties either comprising or in control of the Developer, as well as
any and all changes in the interest or the degree of control of the Developer by any such party, of
which information the Developer or any of its partners or officers has been notified or may
otherwise have knowledge or information. This Agreement may be terminated by the Agency
prior to the Release Date if there is any material change, whether voluntary or involuntary, in
membership, ownership, management or control of the Developer (other than such changes
occasioned by the death or incapacity of any individual shareholder or officer) that has not been
approved by the Agency prior to the time of such change or the Agency may seek other
appropriate relief in the event that at any time following the Transfer Date of the initial Agency
Lot as transferred by the Agency to the Developer such a material change occurs in the
ownership, or control of the Developer, the Developer's interest under the Agreement; provided,
however, that the Agency shall first notify the Developer in writing as set forth in Section 6.01,
of its intention to terminate this Agreement or assert any other remedy under this Agreement.
For the purpose of this Section 1.03 the words "material change" refer to any total
or partial sale, assignment, or conveyance, or any trust power or any transfer in any other mode
or form by the Developer of more than a forty-nine percent (49%) interest of the ownership of
the Developer, and/or a series of such sales, assignments or conveyances which in the aggregate
exceed a disposition or change of more than a forty-nine percent (49%) interest of the ownership
of the Developer.
Section 1.04. Benefit to Proiect Areas. The Agency has determined that the
redevelopment of the Agency Lots by the Developer in accordance with this Agreement will
eliminate blight and provide needed affordable housing to the Meadowbrook Redevelopment
Project Area as well as to areas in proximity thereto, which housing is needed due to the
insufficiency of new affordable housing within the City generally.
Section 1.05. Effective Date.
(a) The Effective Date shall occur when this Agreement has been fully
executed by the parties and each of the following conditions have been satisfied:
(i) the Mayor and Common Council have adopted in their sole discre~ion an
approving resolution as set forth in Health and Safety Code Section 33433,
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approving this Agreement and the disposition of at least eight (8) Agency
Lots to the Developer under the terms of this Agreement;
(ii) the Community Development Commission, as the governing board of the
Agency has adopted in its sole discretion an approving resolution as set
forth in Health and Safety Code Section 33433 approving this Agreement;
and
(iii) the Executive Director has confirmed that the Developer has provided the
Agency with satisfactory evidence of the Developer" s compliance with the
insurance coverage protections in favor of the Agency as set forth in
Section 3.02.
(b) In the event that the three (3) conditions identified in Section 1.05(a) have
not been satisfied within sixty (60) days following the approval of this Agreement by the
members of the governing board of the Agency, this Agreement shall have no further force and
effect and the parities shall be mutually discharged from any further responsibility or liability to
the other party which may otherwise arise under this Agreement.
(c) The Developer acknowledges that the transfer of each Agency Lot, by the
Agency under one or more separate Notices of Availability of Transfer of Agency Lot shall be
subject to the satisfactory completion of one or more public hearings under Health and Safety
Code Section 33433, affecting each such Agency Lot as may hereafter be made available for
transfer by the Agency to the Developer.
Section 1.06. List of Exhibits to Agreement. The following is a listing of the
Exhibits attached to this Agreement. Each such exhibit is incorporated by this by this reference
into the text of this Agreement:
EXHIBIT "A"
Vicinity Map of Neighborhood Restoration Area
EXHIBIT "B"
Form of Notice of Availability for Transfer of Agency Lot(s) -
including form of Agency License Agreement and form of
Developer Due Diligence Approval Certificate for Individual
Agency Lot(s)
EXHIBIT "C"
RESERVED - NO EXHIBIT
EXHIBIT "D"
RESERVED - NO EXHIBIT
EXHIBIT "E"
Forms of Agency Grant Deed
EXHIBIT "F"
RESERVED - NO EXHIBIT
EXHIBIT "G"
Schedule of Performance
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EXHIBIT "H"
Form of Section 33334.3 Covenant
EXHIBIT -T
Form of Agency Lot Purchase Price Promissory Note and Agency
Deed of Trust (Securing Remaining Balance of Agency Lot
Purchase Price)
ARTICLE II
Section 2.01. Neighborhood Restoration Area.
(a) The Neighborhood Restoration Area is depicted in Exhibit "A".
(b) Subject to the terms and conditions of this Agreement, the Agency hereby
agrees that between the Effective Date and December 31, 2006, all Agency Lots which the
Agency owns in the Neighborhood Restoration Area as of the Effective Date which were
acquired by the Agency with Agency Low and Moderate Income Housing Funds, and such other
Agency Lots which the Agency may hereafter acquire following the Effective Date with Low
and Moderate Income Housing Funds up to an including December 31, 2006, which are situated
in the Neighborhood Restoration Area, shall be made available to the Developer for purchase
and improvement as hereinafter set forth in this Agreement.
(c) Nothing in this Agreement shall be deemed to be a covenant or
undertaking by the Agency in favor of the Developer, in which the Agency has agreed or does
hereby agree to acquire or to make any Agency Lot available for purchase from the Agency by
the Developer under the terms of this Agreement.
(d) No land which the Agency has acquired as of the Effective Date or which
the Agency may hereafter acquire in the Neighborhood Restoration Area, from funds other than
the Agency Low and Moderate Income Housing Funds, shall be subject to any term or provision
of this Agreement.
Section 2.02. Notice of A vailabilitv for Transfer of Agencv Lot.
(a) Subject to the terms and conditions of this Agreement, the Agency may
from time-to-time in its sole discretion following the Effective Date, issue one or more of its
Notices of Availability for Transfer to the Developer for one or more Agency Lots. A Notice of
Availability for Transfer may include more than one (1) Agency Lot.
(b) Promptly following its receipt of a Notice of Availability for Transfer, the
Developer shall acknowledge to the Agency its receipt of such notice and shall confirm in
writing to the Agency that the Developer intends to complete its due diligence review of each
Agency Lot identified in such notice within the Due Diligence Period. If the Developer believes
that for a particular Agency Lot, its due diligence review may require more than thirty (30) days
to complete, the Developer shall so inform the Agency in writing within ten (10) days following
its receipt of the Notice of Availability for Transfer of that particular Agency Lot; provided
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however, that the Developer shall complete all due diligence inspections on such an Agency Lot
for which an extension is requested within sixty (60) days following the date of the Notice of
Availability for Transfer for such Agency Lot, unless the Agency has, in its sole discretion,
permitted a longer due diligence period in writing for such Agency Lot.
(c) The Developer hereby agrees to promptly undertake the indicated due
diligence investigation for each Agency Lot which the Agency may hereafter designate in one or
more of its Notices of Availability for Transfer.
(d) Subject to the acceptance by the Developer of the condition of each
Agency Lot as the Agency may hereafter designate in one or more of its Notices of Availability
for Transfer as evidenced by the Developer Due Diligence Approval Certificate for each such
Agency Lot, the Developer and the Agency hereby agree to jointly cause to be opened an
Agency Lot Transfer Escrow for the Agency Lot(s) described in the applicable Notice of
Availability for Transfer.
(e) The transfer and sale of each of the Agency Lots shall take place through
an Agency Lot Transfer Escrow to be administered by the Agency Lot Transfer Escrow Holder
First American Title Insurance Company: Escrow Department or such other escrow or title
insurance company mutually agreed upon by the Developer and the Agency. The Agency Lot
Escrow Holder shall promptly confirm to the parties the escrow number and the title insurance
order number assigned to a particular Agency Lot Transfer Escrow.
(f) Provided that the Developer has delivered its Due Diligence Approval
Certificate within the period of time authorized in Section 2.02, then the Closing Date of each
Agency Lot Transfer Escrow shall occur within thirty (30) days thereafter, subject to the
provisions of Section 2.16 and Section 2.17. The words "Close of Escrow," "Closing Date" and
"Closing" shall mean and refer to the date when the Agency Lot Escrow Holder is in receipt of
all necessary documents and the applicable amount of the Agency Lot Purchase Price, and the
Agency Lot Escrow Holder is in a position to comply with the final written instructions of the
parties and cause an Agency Grant Deed for the applicable Agency Lot(s) to be recorded and the
policy of insurance for each such Agency Lot to be delivered to the Developer.
(g) The parties mutually covenant and agree to execute all necessary or
appropriate written Escrow instructions as may be reasonably requested by the Escrow Holder.
The Developer shall be solely responsible for the payment of the escrow cancellation costs of the
Escrow Holder in any such event.
(h) This Agreement shall also constitute escrow instructions of the parties to
the Agency Lot Escrow Holder. Additionally, the Developer and the Agency each agree to
execute the customary supplemental escrow instructions of the Agency Lot Escrow Holder in the
form provided by the Agency Lot Escrow Holder to its clients in real property escrow
transactions administered by it. In the event of a conflict between the additional terms of such
customary supplemental escrow instructions of the Agency Lot Escrow Holder and the
provisions of this Agreement, shall supersede and be controlling. Upon any termination of this
Agreement or cancellation of an Agency Lot Escrow, the Agency Lot Escrow Holder shall
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forthwith return any monies (as may be provided in this Agreement) and documents, less only
the Agency Lot Escrow Holder's customary and reasonable escrow cancellation fees and
expenses, as set forth herein.
(i) No Notice of Availability for Transfer of Agency Lot shall be issued by
the Agency to the Developer after December 31, 2006.
Section 2.03. Inspections and Developer Investigations-Due Diligence Period.
(a) Within five (5) days after the issuance of each Notice of Availability for
Transfer, the Agency shall deliver to the Developer true, correct and complete copies of the
following documents as relate to each Agency Lot identified in such notice:
(i) copies of all soils, seismic, geologic, drainage, engineering, environmental
and similar type reports and surveys (including, but not limited to, any
environmental site assessment of the Agency Lots), if any, in the
possession or control of the Agency and correspondence relating thereto,
if any, within the Agency's possession or control.
(ii) notices of violation, including, but not limited to, zoning ordinances,
development or building codes affecting the Agency Lot within the
Agency's possession or control.
(iii) disclosure of any legal matter affecting the use or condition of the Agency
Lot within the knowledge of the Agency.
(b) During the Due Diligence Period for each Agency Lot, and subject to the
extensions of time set forth in Section 2.02(b) or Section 2.03(e), the Developer shall have the
right to examine, inspect and investigate each Agency Lot identified in such notice to determine
whether the condition of the applicable Agency Lot is acceptable to the Developer in its sole and
absolute discretion.
Any such investigation work relating to an Agency Lot shall be conducted by the
Developer and/or its agents during the Due Diligence Period in accordance with the terms and
conditions of an Agency Inspection License for the particular Agency Lot. Upon the Agency's
request, the Developer will provide the Agency with copies of any test results of its investigation
of an Agency Lot. During the Due Diligence Period, the Developer shall also have the right to
investigate all matters relating to the zoning, use, and compliance with other applicable laws
which relate to the use and development and improvement of the Agency Lot. The Agency shall
have the right, but not the obligation, to accompany the Developer during the course of
conducting such investigations and/or inspections on each such Agency Lot.
(c) Concurrently with the issuance of a Notice of Availability for Transfer,
Agency shall cause to be delivered to the Developer a preliminary title report or title
commitment for a CL T A extended coverage policy of title insurance from the Title Company,
describing the condition of title of the Agency Lot, together with copies of all exceptions
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specified therein and with all easements plotted but excluding matters disclosed in a title survey
(the "Preliminary Title Report"). The Developer shall notify the Agency in writing within
fifteen (15) days of its receipt of the Notice of Availability for Transfer of Agency Lot and the
Preliminary Title Report for each such Agency Lot ("Developer's Title Objection Notice") of
any objection the Developer may have to the title exceptions contained in the Preliminary Title
Report with respect to any such Agency Lot. The Agency shall have a period of five (5) days
after receipt of the Developer's Title Objection Notice with respect to each Agency Lot, as
applicable, in which to deliver written notice to the Developer ("Agency's Title Notice") of the
Agency's election to either: (i) agree to remove the objectionable items for a particular Agency
Lot prior to the close of the Agency Lot Transfer Escrow, or (ii) decline to remove any such title
exception and withdraw the Notice of Availability for Transfer for such Agency Lot; provided,
however, that the Agency shall be required to remove all monetary liens and encumbrances
created by or as a result of the Agency's acquisition or ownership of such Agency Lot. If the
Agency notifies the Developer of its election to withdraw the Notice of Availability for Transfer
for a particular Agency Lot rather than remove an objectionable item, the Developer shall have
the right, by written notice delivered to the Agency within five (5) days after the Developer's
receipt of the Agency's Title Notice, to agree to accept the Agency Lot subject to the
objectionable item, in which event the Agency's election to withdraw the Notice of Availability
of Transfer for that particular Agency Lot shall be of no effect, and the Developer shall take title
as to the particular Agency Lot at the close of the Agency Lot Transfer Escrow subject to such
objectionable title item.
(d) Following the issuance of a Notice of Availability for Transfer the Agency
covenants not to further encumber and not to place any further liens or encumbrances on each
Agency Lot described in such notice, including, but not limited to easements, options to
purchase, leases, or other possessory interests without the prior written consent of the Developer.
(e) In the event Agency fails to provide to the Developer the documents and
other information required by Sections 2.02 for a particular Agency Lot described in a Notice of
Availability for Transfer within the period of time set forth above, then in such event the Due
Diligence Period for such Agency Lot shall be extended by one (1) day for each day of the delay
by the Agency to permit the Developer to perform its due diligence review (but not to exceed a
total of thirty (30) days.) The Developer will use its best efforts to notify Agency of any
documents the Agency has failed to deliver to the Developer within the time periods provided in
this Section 2.02. In the event that the Developer has delivered its Due Diligence Approval
Certificate for an Agency Lot and thereafter, prior to the close of the Agency Lot Transfer
Escrow for such Agency Lot, the Agency presents the Developer with any new Due Diligence
Item, the close of the Agency Lot Transfer Escrow for such Agency Lot shall be extended to
permit the Developer to perform due diligence review of such new item for up to thirty (30)
days.
Section 2.04. Agency Lot Transfer Escrow: Develooer's Conditions Precedent.
The Developer's obligation to purchase the Agency Lot described in each Notice of Availability
for Transfer shall be conditioned upon the fulfillment of the following conditions precedent, all
of which shall be satisfied (or waived by the Developer in writing pursuant to Section 2.06) prior
to the close of the Agency Lot Transfer Escrow for such Agency Lot:
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(1) The Agency shall not have defaulted on any material term of this
Agreement to be performed by the Agency hereunder: and each representation and
warranty made by the Agency in this Agreement shall remain true and correct. For
purposes of this subsection (1) only, a representation that is limited to the Agency's
knowledge or notice with respect to a particular Agency Lot described in a Notice of
Availability of Transfer shall be false if the factual matter that is subject to the
representation is false, notwithstanding any lack of knowledge or notice to the Agency;
(2) the Developer's approval of the Preliminary Title Report within the time
periods specified in Section 2.03;
(3) the Developer's approval of the contents of all Due Diligence Items, and
the other investigations of the Agency Lot made by the Developer and/or its designees on
or before the expiration of the Due Diligence Period. The Developer shall be deemed to
have disapproved such Due Diligence Items unless they are approved on or before 5:00
p.m. on the final day of the Due Diligence Period;
(4) the Developer's approval of any notice of change in representation or
warranty given by the Agency, if applicable;
(5) the Title Company has committed to issue the Title Policy, in favor of the
Developer as provided herein;
(6) the Developer has obtained, or is reasonably satisfied that it can obtain a
construction financing loan commitment to cover all costs of development, including but
not limited to the infrastructure improvements, and payment of all City or School fees, or
other governmental entities fees, on terms reasonably acceptable to it for each Agency
Lot described in the Notice of Availability for Transfer;
(7) the Agency shall have deemed satisfied (or waived satisfaction of) each of
the conditions precedent set forth in Section 2.05; and
Section 2.05. Agency Lot Transfer Escrow: Agency's Conditions Precedent.
The Agency's obligation to sell and transfer to the Developer any Agency Lot described in each
Notice of Availability for Transfer shall be conditioned upon the fulfillment of the following
conditions precedent, all of which shall be satisfied (or waived in writing pursuant to Section
2.06) prior to the close of the Agency Lot Transfer Escrow for such Agency Lot:
(1) the Developer has accepted the condition of the Agency Lot and submitted
its Due Diligence Approval Certificate to the Agency on or before the date
set forth in Section 2.03;
(2) the Developer has provided the Agency with satisfactory evidence of the
commitment of a lender to provide construction financing to the
Developer for the construction and improvement of the Agency Lot;
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(3) the Developer has executed and delivered to the Agency Escrow Holder
the applicable Agency Lot Promissory Note and Agency Lot Deed of
Trust for each Agency Lot described in the Notice of Availability for
Transfer;
(4) the Developer shall not be in default of any material term of this
Agreement to be performed by the Developer hereunder and each
representation and warranty of the Developer made in this Agreement
shall remain true and correct; and
(5) the Developer shall have satisfied (or shall be deemed to have waived
satisfaction of) each of the conditions precedent set forth in Section 2.04.
Section 2.06. Satisfaction of Conditions. Where satisfaction of any of the
foregoing conditions requires action by the Developer or by the Agency, each party shall use its
diligent best efforts, in good faith, and at its own cost, to satisfy such condition. Where
satisfaction of any of the foregoing conditions requires the approval of a party, such approval
shall be in such party's sole and absolute discretion.
Either party may waive any of the conditions set forth in the Agreement, but any
such waiver shall be effective only if contained in a writing signed by the applicable party and
delivered to the Escrow Holder and the other party.
Section 2.07. Prorations. Closing Costs. Possession.
(a) Proration of Taxes. Real and personal property taxes for each Agency Lot
shall be prorated by the parties to the closing date for each Agency Lot Transfer Escrow on the
basis of a three hundred sixty-five (365) day year on the basis that the Agency is responsible for
(i) all such taxes (if any) for the fiscal year of the applicable taxing authority occurring prior to
the Current Tax Period (as defined below) and (ii) that portion of such taxes for the current tax
period to 11 :59 p.m. on the closing date for each Agency Lot Transfer Escrow, whether or not
the same shall be payable prior to the closing date. The phrase "current tax period" refers to the
fiscal year of the applicable taxing authority in which the closing on an Agency Lot Transfer
Escrow occurs. All tax prorations shall be based upon the latest available tax statement. If the
tax statements for the fiscal tax year during which an Agency Lot Transfer Escrow closes do not
become available until after the closing date for that particular Agency Lot Transfer Escrow,
then the rates and assessed values of the previous year, with known changes, shall be used, and
the parties shall re-prorate said taxes outside of such escrow following the closing date when
such tax statements become available. The Agency shall be responsible for and shall payor
reimburse the Developer upon demand for any Current Tax Period real or personal property
taxes payable following the closing date which are applicable to any period of time prior to the
closing date.
(b) The Developer shall be entitled to possession of each Agency Lot upon the
close of the Agency Lot Transfer Escrow for the particular Agency Lot free and clear of all
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possessory interests and all structures above the surface grade shall have been removed by the
Agency. Provided that the Developer has delivered its Due Diligence Approval Certificate and
has approved or waived the satisfaction of the conditions set forth in Section 2.06, the Agency
shall grant the Developer a temporary license to enter one or more Agency Lots prior to the
closing date for a particular Agency Lot Transfer Escrow for the following purposes:
(i) to conduct surveys and intrusive soil engineering testing and for
repairs to existing perimeter walls surrounding the Agency Lot;
(ii) to install temporary subdivision land sales advertising signs on the
Agency Lot as permitted under the City sign ordinance;
(iii) to conduct such other work as may be approved by the Agency in
its sole discretion.
Prior to the entry by the Developer onto any Agency Lot pursuant to such a
license, the Developer shall execute a written license agreement affecting the particular Agency
Lot in a form to be provided by the Agency in which the Developer shall agree to indemnify,
defend and hold the Agency harmless from any adverse exceptions to title in the particular
Agency Lot which may arise prior to the closing date for a particular Agency Lot Transfer
Escrow by virtue of the Developer's entry onto a particular Agency Lot, or any portion thereof
and the Developer shall further agree to indemnify, defend and hold the Agency harmless from
and against any other claim, cause of action, liability or damage to persons or to property
resulting from the activities of the Developer on a particular Agency Lot or any portion thereof
pursuant to such license agreement.
(c) The Agency shall pay the cost of the premium for a CLTA owner's
extended coverage policy of title insurance on each Agency Lot in the amount of the Agency Lot
Purchase Price, together with all title charges (including endorsements reasonably requested by
the Developer to remove disapproved items shown on the Preliminary Title Report, and the
Agency shall also pay any documentary or other transfer taxes payable on account of the
conveyance of an Agency Lot to the Developer, together with one-half (1'2) of the customary and
reasonable escrow fees which may be charged by the Agency Lot Escrow Holder in connection
with the close of escrow.
The Developer shall pay any additional title insurance coverage cost (to the extent
such endorsements are unrelated to removal of any disapproved items shown on the Preliminary
Title Report) which exceeds the premium for a CLTA owner's extended coverage policy of title
insurance on the particular Agency Lot plus the cost of recording Agency Grant Deed for the
particular Agency Lot, together with one-half (Y2) of the cost of the customary and reasonable
escrow fees charged by Agency Lot Escrow Holder in connection with the close of each Agency
Lot Transfer Escrow.
Any other Escrow-related transaction expenses or escrow closing costs incurred
by the Agency Lot Escrow Holder in connection with this transaction shall be apportioned and
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paid for by the parties to this Agreement in the manner customary in San Bernardino County,
California.
No later than three (3) business days prior to the closing date for each Agency Lot
Transfer Escrow, the Agency Lot Escrow Holder shall prepare for approval by the Developer
and the Agency a closing statement ("Closing Statement") on the Agency Lot Escrow Holder's
standard form indicating, among other things, the Agency Lot Escrow Holder's estimate of all
closing costs, pay-off amounts for the release and reconveyance of all liens secured by the
particular Agency Lot(s) and prorations made pursuant to this Agreement. The Developer and
the Agency shall assist the Agency Lot Escrow Holder in determining the amount of all
prorations.
Section 2.08. Due Diligence Approval Certificate. Within thirty (30) days
following the date of such Notice of Availability for Transfer of Agency Lots, the Developer
shall complete its investigation of the specific Agency Lot(s) which is/are subject to the
applicable Notice of Availability for Transfer (subject to the extensions of time set forth in
Section 2.02) and deliver a Due Diligence Approval Certificate signed by the Developer (the
"Due Diligence Approval Certificate") to the Agency which either:
(i) indicates that the Developer accepts the condition of the particular Agency
Lot(s) or;
(ii) contains a description of the matters or exceptions relating to the condition
of the particular Agency Lot(s) which the Developer was not able to
accept or resolve to its satisfaction during the Due Diligence Period.
Section 2.09. Condition of the Agency Lots: Developer's Release. The
Developer acknowledges and agrees that it shall be given a full opportunity under this
Agreement to inspect and investigate every aspect of each Agency Lot during the Due Diligence
Period. The Developer shall accept the delivery of title to each Agency Lot on the close of each
Agency Lot Transfer Escrow in an "AS IS", "WHERE IS", and "SUBJECT TO ALL FAULTS"
condition. The Developer further agrees and represents to the Agency that by a date no later than
the end of the Due Diligence Period, the Developer shall have conducted and completed (or
waived the completion) of all of its independent investigation of the condition of each Agency
Lot which the Developer may believe to be indicated. The Developer hereby acknowledges that
it shall rely solely upon its own investigation of each Agency Lot and its own review of such
information and documentation as it deems appropriate for the purpose of accepting the
condition and possession of each Agency Lot. The Developer is not relying on any statement or
representation by the Agency relating to the condition of any Agency Lot unless such statement
or representation is specifically contained in this Agreement. Without limiting the foregoing, the
Agency makes no representations or warranties as to whether any Agency Lot presently
complies with Environmental Laws or whether any Agency Lot contains any Hazardous
Substance. Furthermore, to the extent that the Agency has provided the Developer with
information relating to the condition of any Agency Lot, including information and reports
prepared by or on behalf of the City of San Bernardino, the Agency makes no representation or
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warranty with respect to the accuracy, completeness or methodology or content of such reports
or information.
Without limiting the above, except to the extent covered by an express
representation or warranty of the Agency set forth in this Agreement, the Developer, on behalf of
itself and its successors and assigns, waives and release the Agency and its successors and
assigns from any and all demands, claims, legal or administrative proceedings, losses, liability,
damages, penalties, fines, judgments, costs or expenses whatsoever (including, without
limitation, attorneys' fees and costs), whether direct or indirect, known or unknown, foreseen or
unforeseen, arising from or relating to the physical condition of any Agency Lot or any law or
regulation applicable thereto, including the presence or alleged presence of harmful or
Hazardous Substances in, under or about each Agency Lot including, without limitation, any
claims under or on account of any Environmental Laws.
The Developer expressly waives any rights or benefits available to it with respect
to the foregoing release under any provision of applicable law which generally provides that the
general release does not extend to claims which the creditor does not know of suspect to exist in
his or her favor at the time the release is agreed to, which, if known to such creditor. would
materially affect a settlement. By execution of this Agreement, the Developer acknowledges that
it fully understands the foregoing, and with this understanding, nonetheless elects to and does
assume all risk for claims known or unknown, described in this Section 2.09 without limiting the
generality of the foregoing:
The undersigned acknowledges that it has been advised by legal counsel and is familiar
with the provisions of California Civil Code Section 1542, which provides as follows:
"A GENERAL RELEASE DOES NOT EXTEND
TO CLAIMS WHICH THE CREDITOR DOES
NOT KNOW OR SUSPECT TO EXIST IN HIS
FAVOR AT THE TIME OF EXECUTING THE
RELEASE, WHICH IF KNOWN BY HIM, MUST
HAVE MATERIALLY AFFECTED HIS
SETTLEMENT WITH THE DEBTOR."
The undersigned, being aware of this code section, hereby expressly waives any rights it
may have thereunder, as well as under any other statutes or common law principles of
similar effect.
Initials of Developer:_
The provisions of this Section 2.09 with respect to each Agency Lot shall survive
the close of each Agency Lot Transfer Escrow.
Section 2.10. Conveyance of Title. On or before 12:00 noon on the business day
preceding the Closing Date for each Agency Lot Transfer Escrow, the Agency shall deliver to
the Agency Lot Escrow Holder an Agency Grant Deed for each Agency Lot in the form attached
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hereto as Exhibit "E" duly executed and acknowledged by the Agency, which Agency Grant
Deed shall convey all of the right, title and interest of the Agency in such Agency Lot to the
Developer. The Escrow Holder shall be instructed to record the Agency Grant Deed in the
Official Records of San Bernardino County, California, if and 'when Agency Lot Escrow Holder
holds the various instruments and funds for the accounts of the parties as set forth herein and can
obtain for the Developer a CL T A owner's extended coverage policy of title insurance issued by
Title Insurance Company or such other title insurance company
mutually agreed upon by the parties ("Title Company") with liability in an amount equal to the
applicable Agency Lot Purchase Price together with such endorsements to the policy as may be
reasonably requested by the Developer, insuring that each Agency Lot shall consist of fee title
,vested in the Developer (or the Developer's assignee or nominee) and subject only to:
(1) non-delinquent real property taxes;
(2) non-monetary title exceptions approved by the Developer;
(3) applicable provisions of the subdivision map, if any, for the Agency Lot;
(4) the provisions of the Agency Grant Deed, as applicable for the particular
Agency Lot;
(5) if applicable, the security interest of the Agency in the Agency Deed of
Trust;
(6) the applicable provisions of this Agreement; and
(7) such other title exceptions, if any, resulting from documents being
recorded or delivered through the Agency Lot Transfer Escrow.
Section 2.11. Additional Closing Obligations of Agency. On or before 12:00
noon on the business day preceding each Agency Lot Transfer Escrow Closing Date (unless
indi.cated otherwise), the Agency shall deliver to the Agency Lot Escrow Holder (unless
indicated to be delivered directly to the Developer) copies of the following documents and other
items:
(1) a certificate of non-foreign status (the "Non-Foreign Affidavit") executed
by the Agency, in the customary form provided by the Escrow Holder, and a California
Franchise Tax Board Form 590-RE executed by the Agency;
(2) two (2) duplicate original copies of the Closing Statement described in
Section 2.08(c), duly executed by the Agency;
(3) evidence of the existence, organization and authority of the Agency and
of the authority of persons executing documents on behalf of the Agency reasonably
satisfactory to the Agency Lot Escrow Holder and Title Company; and
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(4) any other documents, instruments, funds, and records required to be
delivered to the Developer under the terms of Agreement which have not been previously
delivered. .
Section 2.12. Closing Obligations of Developer. On or before 12:00 noon on the
business day preceding the Closing Date for each Agency Lot Transfer Escrow, the Developer
shall deliver to the Agency Lot Escrow Holder copies of the following documents and other
items:
(1) an acknowledgment and acceptance of the Agency Grant Deeds, duly
executed and acknowledged by the Developer.
(2) two (2) duplicate original copies of the Closing Statement, duly executed
by the Developer.
(3) evidence of the existence, organization and authority of the Developer and
of the authority of persons executing documents on behalf of the Developer reasonably
satisfactory to the Agency Lot Escrow Holder and the Title Company.
(4) any other documents, instruments, or funds required to be delivered by the
Developer under the terms of Agreement or as otherwise required by Agency Lot Escrow
Holder or Title Company in order to close each Agency Lot Transfer Escrow which have
not previously been delivered.
Section 2.13. Representations and Warranties.
(a) Warranties and Representations by the Agency. The Agency hereby
makes the following representations, covenants and warranties and acknowledges that the
execution of this Agreement by the Developer has been made in material reliance by the
Developer on such covenants, representations and warranties:
(i) Warranties True. Each and every undertaking and obligation of the
Agency under this Agreement shall be performed by the Agency timely when due; and
that all representations and warranties of the Agency under this Agreement and its
exhibits shall be true in all material respects as of the Effective Date.
(ii) Due Organization. The Agency is a community redevelopment agency,
duly formed and operating under the laws of California. The Agency has the legal
power, right and authority to enter into this Agreement and to execute the instruments
and documents referenced herein, and to consummate the transactions contemplated
hereby.
(iii) Requisite Action. The execution of this Agreement has been duly
approved by the governing body of the Agency.
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(iv) Execution of Agreement. The persons executing any instruments for or on
behalf of the Agency have been authorized to act on behalf of the Agency in furtherance
of the implementation and fulfillment of the Agency commitments under this Agreement.
(v) Use of Agency Low-Mod Funds. The sole source of funds which the
Agency has used, or may hereafter use to acquire any of the Agency Lots, shal1 be
derived from the low and moderate income housing set aside funds of the Agency (as this
term is defined at Health and Safety Code Section 33334.2 and 33334.3(b)) and from no
other source of funds of the Agency or the City of San Bernardino.
(b) Warranties and Representations by the Developer. The Developer hereby
makes the fol1owing representations, covenants and warranties and acknowledges that the
execution of this Agreement by the Agency has been made in material reliance by the Agency on
such covenants, representations and warranties:
(i) The Developer is a duly organized and validly existing California
corporation. The Developer has the legal right, power and authority to enter into
this Agreement and the instruments and documents referenced herein and to
consummate the transactions contemplated hereby. The persons executing this
Agreement and the instruments referenced herein on behalf of the Developer
hereby represent and warrant that such persons have the power, right and
authority to bind the Developer.
(ii) The Developer has taken al1 requIsIte action and obtained all
requisite consents in connection with entering into this Agreement and the
instruments and documents referenced herein and the consummation of the
transactions contemplated hereby, and no consent of any other party is required
for the Developer's authorization to enter into this Agreement.
(iii) This Agreement is, and all agreements, instruments and documents
to be executed by the Developer pursuant to this Agreement shal1 be, duly
executed by and are or shall be valid and legally binding upon the Developer and
enforceable in accordance with their respective terms.
(iv) The Project development cost pro forma as prepared by the
Developer and submitted to the Agency as of the Effective Date is to the best
information and belief of the Developer, a fair and reasonable presentation of the
costs and expenses which the Developer expects to incur as of the Effective Date
with respect to the development of the Project.
(v) The books and accounting records of the Developer with respect to
the improvement of the New Agency Home and performance of any of the Work
and the final accounting for the Net Development Cost for the Completed New
Agency Home, shal1 conform to the financial accountability standards of
Attachment F of Office of Management and Budget Circular A-llO, as evidenced
by a notarized statement by the certified public accountant.
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(vi) Neither the execution of this Agreement nor the consummation of
the transactions contemplated hereby shall result in a breach of or constitute a
default under any other agreement, document, instrument or other obligation to
which the Developer is a party or by which the Developer may be bound, or under
law, statute, ordinance, rule, governmental regulation or any writ, injunction,
order or decree of any court or governmental body applicable to the Developer.
(vii) The Developer represents and warrants to the Agency that the
Developer shall not accept any other financial assistance from any other public
agency in connection with the Project, including the City of San Bernardino,
unless the Developer first complies with the applicable provisions of Labor Code
Section 1720 in connection with its acceptance of such other assistance.
(viii) The representations and warranties of the Developer contained in
this Section 2.13(b) shall be based upon the actual knowledge of George Jordan.
All representations and warranties contained in this Section 2.13(b) are true and
correct on the date hereof and on the Effective Date.
(c) Change in Facts. If either party becomes aware of any act or circumstance
which would change or render incorrect, in whole or in part, any representation or warranty
made by such party under this Agreement, whether as of the Effective Date or any time
thereafter and whether or not such representation or warranty was based upon such party's
knowledge and/or belief as of a certain date, the Agency will give immediate written notice of
such changed fact or circumstance to the other party, but such notice shall not release such party
of its liabilities or obligations with respect thereto.
Section 2.14. Damage. Destruction and Condemnation Prior to Close of An
Agency Lot Transfer Escrow. If an Agency Lot suffers damages as a result of any casualty prior
to the Close of an Agency Lot Transfer Escrow then the Agency shall give written notice thereof
to the Developer as promptly as feasible after the occurrence of the casualty. The Developer
may elect within five (5) calendar days after its receipt of such a notice to reject the condition of
the particular Agency Lot, whereupon, such Agency Lot shall be withdrawn from transfer to the
Developer and the parties shall jointly issue a written notice of cancellation to the Agency Lot
Transfer Escrow Holder for the particular escrow, whereupon, the parties shall be mutually
released with respect to any further right or duty with respect to such Agency Lot.
Section 2.15. Agency Lot Purchase Price.
(a) The applicable Agency Lot Purchase Price for each Agency Lot shall be
set forth in the Notice of Availability for Transfer and shall be determined in accordance with the
provisions of this Section 2.15.
(b) The Agency Lot Purchase Price for a Type A Agency Lot shall be Thirty
Thousand Dollars ($30,000). The Agency Lot Purchase Price for each Type A Agency Lot shall
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be payable at the close of the applicable Agency Lot Transfer Escrow by the Developer, as
evidenced by the Type A Agency Lot Promissory Note for $30,000 and secured by the Agency
Deed of Trust. The Agency Deed of Trust shall be subordinate to the security interest of the
Developer's construction lender in the Agency Lot pursuant to the terms of a construction loan
subordination agreement by and among the Developer and the Agency in favor of such
construction lender in a form reasonably acceptable to the Agency Executive Director. Such
construction loan subordination agreement shall contain assurances of the construction lender as
reasonably satisfactory to the Agency Executive Director, that a course of construction
disbursement control program for the construction loan shall be observed and enforced by the
construction lender and that no proceeds of the construction loan shall be disbursed to the
Developer as a "land draw".
(c) The Agency Lot Purchase Price for a Type B Agency Lot shall be an
amount as set forth as an estimate in the Notice of Availability for Transfer for such Type B
Agency Lot. The Agency Lot Purchase Price for the Type B Agency Lot shall be payable at the
close of the applicable Agency Lot Transfer Escrow by the Developer as evidenced by the Type
B Agency Lot Promissory Note and secured by the Agency Deed of Trust, and the amount of the
Agency Lot Purchase Price for each such Type B Agency Lot shall be determined in accordance
with the provisions of Section 2.17.
(d) The Agency Lot Purchase Price for a Type C Agency Lot shall be the
greater amount of either Fifty Thousand Dollars ($50,000) for each such Agency Lot, or an
amount determined by the Agency based upon its approved real property appraisal report for
such Agency Lot, to be the fair market value for such Agency Lot; provided however that the
date of value under such Agency appraisal for such Type C Agency Lot shall not be more than
one hundred and eighty (180) days prior to the date on which the Agency Lot Transfer Escrow
for the Type C Agency Lot may close. The Agency Lot Purchase Price for each Type C Agency
Lot shall be payable at the close of the applicable Agency Lot Transfer Escrow by the
Developer, as evidenced by the Type C Agency Lot Promissory Note and secured by the Agency
Deed of Trust.
Section 2.16. No Possessory Interest on Agency Lots and Relocation Claims.
Each Agency Lot shall be delivered to the Developer at the Close of each Agency
Lot Transfer Escrow free and clear of all possessory interests. The Agency shall be solely
responsible for providing for the relocation of any person or family who may be displaced from
an Agency Lot as a result of the transfer and sale of such Agency Lot by the Agency to the
Developer.
Section 2.17. Special Provisions for the Determination of the Agency Lot
Purchase Price for a Type B Agency Lot.
(a) As of the Effective Date, no Agency Lot which is presently anticipated to
be included in the initial or first Notice of Availability for Transfer, includes a Type B Agency
Lot. However. at such time as a Type B Agency Lot may be available for transfer to the
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Developer, the provisions of this Section 2.17 shall be applicable to the determination of the
Agency Lot Purchase Price for each such Type B Agency Lot.
(b) As promptly as may be feasible prior to the issuance of any Notice of
Availability for Transfer by the Agency for a Type B Agency Lot, but in no event less than
ninety (90) days prior to such time, the Agency shall provide written notice to the Developer that
a Type B Agency Lot may potentially be available for transfer to the Developer, subject to the
actual issuance by the Agency of a Notice of Availability for Transfer for such particular Type B
Agency Lot following the completion of a public hearing thereon as required under Section
l.05(c).
(c) Within sixty (60) days following its receipt of the notification described in
Section 2.l7(b), the Developer shall provide the Agency with a suitably detailed construction
cost pro forma for the Developer's estimated cost of constructing a New Home on the Type B
Agency Lot and marketing and selling such completed New Home to a Low Income
Household/Qualified Homebuyer at an Affordable Housing Cost. Such Developer pro forma
shall include an indication of the Developer's best estimate of the amount of the Agency Lot
Purchase Price for such Type B Agency Lot which development cost and market conditions can
support in light of the conditions set forth in the Developer's construction cost pro forma for
such Type B Agency Lot. The Developer may assume for the purpose of preparing and
submitting its construction cost pro forma that Agency Downpayment Assistance shall be made
available to the Qualified Homebuyer for such Agency Lot. The Developer and the Agency staff
shall thereafter consider the amount of the Agency Lot Purchase Price for the Type B Agency
Lot which the Agency staff may recommend for approval to the governing board of the Agency;
provided however, that the Agency shall have no duty or obligation to provide any subsidy or
financial contribution of Agency Low and Moderate Income Housing funds to the construction
of a New Home on such Type B Agency Lot, except as may be approved in the sole and absolute
discretion of the governing board of the Agency upon the conclusion of the public hearing set
forth in Section 2.l7(d).
(d) The issuance of a Notice of Availability for Transfer for each Type B
Agency Lot shall be subject to the approval of the City and the governing board of the Agency at
the conclusion of a public hearing as required by Section l.05(c) of this Agreement and Health
and Safety Code Section 33433. At the time of such public hearing the Agency staff shall
include in the report to the City Council, a preliminary estimate of the Agency Lot Purchase
Price payable for the Type B Agency Lot which is based upon the Developer's pro forma
submitted for such Type C Agency Lot in accordance with Section 2.l7(c).
(e) Subject to the issuance of a Notice of Availability for Transfer, the
Agency Lot Purchase Price for such Type B Agency Lot, shall be evidenced by a Type B
Agency Lot Promissory Note and shall be secured by an Agency Deed of Trust. The Type B
Agency Lot Promissory Note shall be payable at the time of close of the New Home Escrow for
the sale of the Completed New Home on the Type B Agency Lot to the Qualified Homebuyer in
an amount which shall be determined in accordance with the following formula:
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(Completed New Home Purchase Price paid by the Qualified Homebuyer at close
of the applicable New Home Escrow for the New Home constructed on the
particular Type B Agency Lot) - (New Home Sales Costs for the New Home
constructed on the particular Type B Agency Lot) = Agency Lot Purchase Price
for the Type B Agency Lot; provided however, that in no event shall such Agency
Lot Purchase Price for a Type B Agency Lot be an amount which is less than One
Hundred Dollars ($100).
(f) Within sixty (60) days following the close of each New Home Escrow for
a Type B Agency Lot, the Developer shall prepare and deliver to the Agency its New Home
Sales Costs Certificate for the Completed New Home as constructed on such Type B Agency
Lot. The Agency shall have the right to conduct and complete a financial audit of the
information presented in the New Home Sales Costs Certificate at the expense of the Agency, in
accordance with generally accepted accounting principles, within ninety (90) days following its
receipt of each such New Home Sales Costs Certificate. The Developer shall cooperate with the
Agency and its agents in the conduct of any such audit of the financial information set foIjh in
each such New Home Sales Costs Certificate, including the delivery to the Agency upon request
of underlying construction or service contracts and invoices for services performed or products
delivered to the Developer by third parties relating to the Project. In the event that the Agency
reasonably determines based upon such audit of the New Home Sales Costs Certificate that an
adjustment in the Agency Lot Purchase Price for the Type B Agency Lot is indicated, plus or
minus, then in such event, the difference between the amount paid to the Agency as the Agency
Lot Purchase Price for the Type B Agency Lot at the close of the New Home Escrow for such
Agency Lot, and the amount of such Agency Lot Purchase Price as confirmed by the Agency
following its receipt of the New Home Sales Costs Certificate for the New Home constructed on
such Type B Agency Lot, shall be paid to the Agency, or the Developer, as applicable; provided
however, that in no event shall the amount of the Type B Agency Lot Purchase Price, as
confirmed by the Agency be less than One Hundred Dollars ($100).
ARTICLE III
DEVELOPMENT OF THE AGENCY LOTS
Section 3.01. Scope of Development bv Developer.
(a) It is the intent of the parties that each Agency Lot shall be developed as
follows: (i) the construction by the Developer on each of the Agency Lots of single family
detached residential dwelling units (e.g., each a New Home), containing a minimum interior
living area of 1,450 square feet each, together with all on and off-site improvements such as
streets, curbs, sidewalks, storm drains, gutter, utilities, etc. Each New Home shall be reserved
for sale and occupancy by a Qualified Homebuyer.
(b) The City's zoning ordinance and the City's building requirements will be
applicable to the use and development of the New Homes on each Agency Lot. The Developer
acknowledges that any material change in the plans for development of the New Homes on an
Agency Lot as set forth in the Scope of Development shall be subject to the City's zoning
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ordinance and building requirements. No action by the Agency or the City with reference to this
Agreement or related documents shall be deemed to constitute a waiver of any lawful City
requirements which are applicable to the Agency Lots or to the Developer, any successor in
interest of the Developer or any successor in interest pertaining to the Agency Lots, except by
modification or development variance approved by the City consistent with this Agreement.
(c) The Scope of Development set forth in Exhibit "F" is hereby approved by
the Agency upon its execution of this Agreement. The New Homes shall be constructed and
improved on the Agency Lots in conformance with the Scope of Development and any and all
other plans, specifications and similar development documents required by this Agreement,
except for such changes as may be mutually agreed upon in writing by and between the
Developer and the Agency and the mutual approval of any such change shall not be
unreasonably conditioned, withheld or delayed. The approval by the City of any element of the
Project, which may be subject to the discretionary or ministerial regulatory review of the City,
shall be deemed to be approved by the Agency.
(d) The approval of the Scope of Development by the Agency hereunder shall
not be binding upon the Common Council of the City or the Planning Commission of the City
with respect to any regulatory approvals relating to the improvement of the New Homes and/or
the public improvements necessary for the development of the Agency Lots as may be required
by such other bodies. If any material change of the Scope of Development as previously
approved by the Agency shall be required by another government official, agency, department or
bureau having jurisdiction over the development of the Agency Lots, the Agency shall not
unreasonably withhold or delay approval of such revisions to the Scope of Development as the
Developer may reasonably request.
(e) The Developer agrees to accept and comply fully with any and all lawful
and reasonable conditions of approval applicable to all permits and other governmental actions
affecting the improvement of each Agency Lot with a New Home of the Project.
(f) The Developer shall cause landscaping plans in connection with
improvement of each Agency Lot with a New Home to be prepared by a licensed landscape
contractor or architect. The Developer shall prepare and submit, preliminary and final
landscaping plans for the improvement of each Agency Lot with a New Home to the City for its
approval which are consistent with City Code requirements. These plans shall be prepared,
submitted and approved within the times established therefor in the Schedule of Performance.
(g) The Developer shall prepare and submit development plans, construction
drawings and related documents for the improvement of each Agency Lot with a New Home
consistent with the Scope of Development to the City. The development plans, construction
drawings and related documents submitted by the Developer to the City shall be in the form of
final drawings, plans and specifications. Such final drawings, plans, and specifications are
hereby defined as those which contain sufficient detail necessary to obtain a building permit
from the City for the construction of a New Home on each Agency Lot.
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(h) During the preparation of all drawings and plans in connection with the
improvement of the New Homes and the public improvements necessary for the improvement of
each Agency Lot with a New Home, the Developer shall provide to the Agency regular progress
reports to advise the Agency of the status of the preparation by the Developer, and the
submission to and review by the City of construction plans and related documents. The
Developer shall communicate and consult with the Agency as frequently as is necessary to
ensure that any such plans and related documents submitted by the Developer to the City are
being processed in a timely manner.
(i) The Agency shall have the right to review all plans, drawings and related
documents pertinent to the development of the improvement of each Agency Lot with a New
Home in order to ensure that they are consistent with this Agreement and with the Scope of
Development.
(j) The Developer shall timely submit to the City for its review and approval
any and all plans, drawings and related documents pertinent to the development of the Project, as
required by the City. The Agency shall cooperate with and shall assist the Developer in order for
the Developer to obtain the approval of any and all development plans, construction drawings
and related documents submitted by the Developer to the City consistent with this Agreement as
promptly as feasible following the City's receipt of such plans. Any failure by the City to
approve any of such plans or to issue necessary permits for the development of the Project within
sixty (60) calendar day following submission by the Developer to the City of complete and
correct plans shall constitute an enforced delay hereunder, and the Schedule of Performance shall
be extended by that period of time beyond a sixty (60) calendar day period in which the City
approves said plans; provided, however, that in the event that the City disapproves of any of such
plans, the Developer shall within thirty (30) calendar days after receipt of such disapproval
revise and resubmit such plans in accordance with the City's requirements and in such form and
substance so as to obtain the City's approval thereof.
(k) [RESERVED - - NO TEXT]
(1) The Agency shall approve any modified or revised plans, drawings, and
related documents to which reference is made in this Agreement as long as such modified or
revised plans, drawings, and related documents are generally consistent with the Scope of
Development and any other plans which have been approved by the Agency. Upon any
disapproval of such modified or revised plans, drawings or related documents, the Agency shall
state in writing the reasons for such disapproval. The Developer, upon receipt of notice of any
disapproval, shall promptly revise such disapproved portions of the plans, drawings or related
documents in a manner that addresses the reasons for disapproval and reasonably meets the
requirements of the Agency in order to obtain the Agency's approval thereof. The Developer
shall resubmit such revised plans, drawings and related documents to the Agency as soon as
possible after its receipt of the notice of disapproval and, in any event, no later than thirty (30)
calendar days thereafter. The Agency shall approve or disapprove such revised plans, drawings
and related documents in the same manner and within the same times as provided in this Section
for approval or disapproval of plans, drawings and related documents initially submitted to thegAgency, and if no specific time for approval if specified then the Agency shall so approve or
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disapprove the proposed modifications or revisions promptly upon the written request of the
Developer.
(m) If the Developer desires to make any material change in the final
construction drawings, plans and specifications and related documents after their approval by the
Agency and/or the City, the Developer shall submit the proposed change in writing to the
Agency and/or the City for approval. The Agency shall notify the Developer of approval or
disapproval thereof in writing within thirty (30) calendar days after submission to the Agency.
This thirty (30) calendar day period may be extended by mutual consent of the Developer and the
Agency. Any such change shall, in any event, be deemed to be approved by the Agency unless
rejected, in whole or in part, by written notice thereof submitted by the Agency to the Developer,
setting forth in detail the reasons therefor, and such rejection shall be made within said thirty
(30) calendar day period unless extended as permitted herein. The Agency shall use its best
efforts to cause the City to review and approve or disapprove any such change as provided in
Section 3.01(j) hereof.
(n) The Developer, upon receipt of written notice of disapproval of a proposed
change in construction drawings, plans and specifications by the Agency and/or the City, may
revise such portions of the proposed change in construction drawings, plans and specifications
and related documents as are rejected and shall thereafter resubmit such revisions to the Agency
and/or the City for approval in the manner provided in Section 3.01(j) hereof.
(0) The Developer shall have the right during the course of construction to
make changes in construction concerning the interior design of the New Homes and "minor field
changes" with respect to the New Homes, and to make "minor field changes" to the public
improvements necessary for the development of the Project without seeking the approval of the
Agency; provided, however, that such changes do not affect the type of use to be conducted
within all or any portion of a New Home or the ability of the City to accept the completion of the
public improvements necessary for the development of the Project; and further provided that the
City has approved any such minor field change to either a New Home or the public
improvements necessary for the development of the Project in accordance with the standards and
practices of the City Building Department and/or City Public Works Department, as applicable.
Said "minor field changes" shall be defined as those changes from the approved final
construction drawings, plans and specifications which have no substantial effect on the
improvements and are made in order to expedite the work of construction in response to field
conditions. Nothing contained in this subsection shall be deemed to constitute a waiver of or
change in the City's Building Code or Public Works Department requirements governing such
"minor field changes" or in any and all approvals by the City otherwise required for such "minor
field changes".
(p) Except as otherwise specified in this Agreement, the cost of constructing
the New Homes and all other improvements on the Project shall be paid for by the Developer.
(q) Developer shall pay the school capital facility development improvement
fees as required and at the time specified by the San Bernardino City Unified School District.
All other development fees imposed by the City as a condition of issuance of any permit for the
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development of the Project shall be paid by the Developer to the City at the time of issuance of
each such permit or, subject to the approval of the City in its discretion, at the close of each New
Home Escrow, pursuant to the terms of the City of San Bernardino's Development Fee Deferral
program as may then be in effect.
(r) The Developer shall at its expense cause to be prepared, and shall pay any
and all fees pertaining to the review and approval thereof by the City, all required construction,
planning and other documents reasonably required by governmental bodies pertinent to the
development of the Project hereunder including, but not limited to the public improvements
necessary for the development of the Project and to the specifications, drawings, plans, maps,
. permit applications, land use applications, zoning applications and design review documents for
the New Homes, and the New Agency Home. .
(s) The Developer shall pay for any and all costs, including but not limited to
the costs of design, construction, relocation and securing of permits for utility improvements and
connections, which may be required in developing the Project. The Developer shaH obtain any
and all necessary approvals prior to the commencement of applicable portions of said
construction, and the Developer shall take reasonable precautions to ensure the safety and
habitability of surrounding properties during said construction.
(t) The Developer shall begin and complete all construction and development
and undertake all obligations and responsibilities of the Developer within the times specified in
the Schedule of Performance, or within such reasonable extensions of such times as may be
granted by the Agency or as otherwise provided for in this Agreement. The Schedule of
Performance shall be subject to revision from time to time as mutually agreed upon in writing by
and between the Developer and the Agency. Any and all deadlines for performance by the
parties shall be extended for any times attributable to delays which are not the fault of the
performing party and are caused by the other party, other than periods for review and approval or
reasonable disapprovals of plans, drawings and related documents, specifications or applications
for permits as provided in this Agreement.
(u) The Developer shall, at its own expense, secure or shall cause to be
secured, any and all permits which may be required for the construction, development, or work
of the Project by the City or any other governmental agency having jurisdiction thereof.
(v) Officers, employees, agents or representatives of the Agency and the City
shall have the right of reasonable access to the Agency Lots, during normal business hours
during the period of construction for the purposes of monitoring the Developer's performance
under this Agreement.
Section 3.02. Insurance Coverage of Developer. By no later than the date
indicated in Section 1.05 the Developer shaH furnish, or shall cause to be furnished, to the
Agency duplicate originals or appropriate certificates of public indemnity and liability insurance
in the amount of Two Million Dollars ($2,000,000.00) combined single limit, naming the
Agency, the City and the elected officers, officials, employees, attorneys and agents of both of
them, as additional insureds. Said insurance shall cover comprehensive general liability
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including, but not limited to, contractual liability; acts of subcontractors; premises-operations;
explosion, collapse and underground hazards, if applicable; broad form property damage, and
personal injury including libel, slander and false arrest. In addition, the Developer shall provide
to the Agency adequate proof of comprehensive automobile liability insurance covering owned,
non-owned and hired vehicles, combined single limit in the amount of One Million Dollars
($1,000,000.00) each occurrence; and proof of workers' compensation insurance. Any and all
insurance policies required hereunder shall be obtained from insurance companies admitted in
the State of California and rated at least B+: XII in Best's Insurance Guide, or in special
circumstances, be pre-approved by both the Executive Director of the Agency and the Agency
Counsel. All said insurance policies shall provide that they may not be canceled unless the
Agency and the City receive written notice of cancellation at least thirty (30) calendar days prior
to the effective date of cancellation. Any and all insurance obtained by the Developer hereunder
shall be primary to any and all insurance which the Agency and/or City may otherwise carry,
including self insurance, which for all purposes of this Agreement shall be separate and apart
from the requirements of this Agreement. Any insurance policies governing the Site as obtained
by the Agency shall not be transferred from the Agency to the Developer. Appropriate insurance
means those insurance policies approved by the Agency Counsel consistent with the foregoing.
Any and all insurance required hereunder shall be maintained and kept in force until the Release
Date.
Section 3.03. Prohibition Against Transfer.
(a) Prior to the completion of the Project, the Developer shall not, without
prior written approval of the Agency or except as permitted by this Agreement, (i) assign or
attempt to assign this Agreement or any right herein or (ii) make any total or partial sale,
transfer, conveyance, lease, leaseback, or assignment of any Agency Lot or permit to be placed
on any Agency Lot any unauthorized mortgage, trust deed, deed of trust, encumbrance or lien.
This prohibition shall not apply to any of the following: (1) the reasonable grant by the
Developer of utility easements or permits to facilitate the development of any Agency Lot; (2)
the assignment of all of the Developer's interest in this Agreement to a limited liability company
of which the Developer is the managing member (and the assumption of such interest by such
limited liability company); (3) any permitted construction financing interest under Section 3.04;
and (4) sales by the Developer of individual New Homes.
(b) In the absence of specific written agreement or approval by the Agency,
no unauthorized sale, transfer, conveyance, lease, leaseback or assignment of a Agency Lot shall
be deemed to relieve the Developer or any other party from any obligations under this
Agreement.
(c) Developer shall not lease or rent any of the New Home, or any structure
thereon for commercial or residential occupancy by any person, pending final sale to a Qualified
Homebuyer.
(a) The words "mortgage" and "deed of trust" as used herein shall be deemed
to include all other customary and appropriate modes of financing real estate construction and
land development. Notwithstanding any provision of Section 3.03 to the contrary, mortgages,
deeds of trust, or any other form of lien required for any reasonable method of financing the
construction and improvement of the Project are permitted on any Agency Lot before the
completion of the Project. The Developer shall notify the Agency in writing in advance of any
mortgage, deed of trust, or other form of lien for financing of the Project which the Developer
proposes to be secured by any Agency Lot before the recordation of any such Project-related
construction financing security interests. The Developer shall not enter into any such
conveyance for construction financing without the prior written approval of the Agency, which
approval the Agency shall grant if: (i) any such conveyance is given to a responsible financial or
lending institution including, without limitation, banks, savings and loan institutions, insurance
companies, real estate investment trusts, pension programs and the like, or other acceptable
persons or entities for the purpose of financing the construction of the New Homes on the
Agency Lots, and (ii) such loan contains customary construction lender disbursement controls.
(b) The Developer shall promptly notify the Agency of any mortgage, deed of
trust or other refinancing, encumbrance or lien that has been created or attached thereto prior to
completion of the construction of the New Homes whether by voluntary act of the Developer or
otherwise; provided, however, that no notice of filing of preliminary notices or mechanic's liens
need be given by the Developer to the Agency prior to suit being filed to foreclose such
mechanic's lien.
(c) The holder of any mortgage, deed of trust or other security interest
authorized by this Agreement shall in no manner be obligated by the provisions of this
Agreement to construct or complete the Project or to guarantee such construction or completion;
provided however, that each surety under any completion and payment surety bond delivered by
the Developer to the City of San Bernardino, if any, under the terms of any off-site improvement
permit issued by the City to the Developer, shall not, by the virtue of any term of this
Agreement, be deemed to be discharged from its obligation to the City as arises under such
surety.
(d) In the event of a default or breach by the Developer of a mortgage, deed of
trust or other security interest with respect to the Project or any Agency Lot prior to the
completion of the Project and the holder of such security interest has not exercised its option to
complete the Project, the Agency may cure the default of the Developer with respect to one or
more of the Agency Lots, but is under no obligation to do so prior to completion of any
foreclosure. In the event that the Agency may cure any such default by the Developer, 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 deemed to have a lien of the
Agency as may arise under this Section 3.04(d) upon the Project (or any Agency Lot) to the
extent of such costs and disbursements. Any such lien shall be subordinate and subject to
mortgage, deed of trust or other security instrument executed by the Developer encumbering the
applicable Agency Lots.
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Section 3.05. Property Taxes and Assessments. The Developer shall pay prior to
the delinquency all real property taxes and assessments assessed and levied on or against the
Agency Lots prior to the close of each New Home Escrow. Nothing herein shall be deemed to
prohibit the Developer from contesting the validity or amounts of any tax assessment,
encumbrance or lien, nor to limit the remedies available to the Developer in respect thereto.
Section 3.06. Developer Market Reports to the Agency.
(a) From and after the date of the close of the first Agency Lot Transfer
Escrow until the completion of the Project the Developer shall provide the Agency with the
following financial reports relating to the Project and the individual Agency Lots which have
been transferred to the Developer:
(i) within sixty (60) days of the end of each calendar quarter and upon the
request of the Agency, a report on the status of the Project, which shall
include, at a minimum, the trial balance, general ledger, cash receipt
journal, cash disbursements journal, sales journal, job cost summary
compared with the Project pro-forma, bank statement, and quarterly profit
and loss statement, and schedule of cash flows and a weekly sales report
for New Homes, as applicable; and
(ii) within one hundred twenty (120) days after the end of each fiscal year of
the Developer, an annual unaudited financial statement, prepared by the
Developer for the Project, or, if obtained by the Developer, an audited
financial for the Project.
(b) The Agency shall have the right to inspect the business and financial
records of the Developer as relate to the Project and the presentation of the information described
in subsection (a), above with respect to the verification by the Agency of final Project
development costs. The Developer shall provide the Agency (and its auditors or accountants)
with reasonable access to such business records upon reasonable prior notice from the Agency.
The Agency shall pay for its copying and accounting costs associated with inspection of the
business records provided by the Developer to the Agency for inspection.
ARTICLE IV
USE AND DISPOSITION OF THE AGENCY LOTS BY THE DEVELOPER
Section 4.01. Uses.
(a) The Developer covenants and agrees for itself, its successors, and assigns
that at each Type A Agency Lot and each Type B Agency Lot shall be developed, constructed,
improved and reserved for sale and occupancy by Qualified Homebuyers whose Adjusted ~amily
Income at the time of initial occupancy of each New Home does not exceed the household
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income qualification limits of a Low Income Household or a Moderate Income Household, as
applicable.
The Developer shall cause to be recorded at the time of close of each New Home
Escrow for which the provisions of Section 4.01(a) are applicable the fully executed form of the
Section 33334.3 Covenant. The final form of the Section 33334.3 Covenant shall be delivered to
the New Home Escrow Holder for execution by the Developer and the Qualified Homebuyer at
the time of close of each applicable New Home Escrow. If the Qualified Homebuyer may use
Agency Downpayment Assistance Funds for the purchase of the New Home from the Developer,
the Qualified Homebuyer and the Agency shall execute a separate set of redevelopment
affordability covenants in favor of the Agency to evidence the obligation of the Qualified
Homebuyer to the Agency which arise by virtue of the Qualified Homebuyer's acceptance of
Agency Downpayment Assistance Funds under the Agency MAP program.
(b) The Developer further covenants and agrees for itself, its successors and
assigns that each of the Agency Lots shall be improved, developed and used in accordance with
the Scope of Development. Developer covenants to develop and use the Agency Lots in
conformity with all applicable laws.
Section 4.02. Disposition of the Agency Lots to Qualified Homebuyers.
(a) Upon the completion of improvement of a New Home by the Developer
on each Agency Lot, the Developer shall transfer and sell all of its right, title and interest in the
Agency Lot, as improved with the completed New Home to a Qualified Homebuyer designated
by the Developer. The completed New Home Purchase Price payable by such Qualified
Homebuyer to the Developer for the completed New Home in the case of a New Home
constructed on the Type A Agency Lot or a Type B Agency Lot, shall be an amount which does
not exceed an Affordable Housing Cost for the Qualified Homebuyer. The completed New
Home Purchase Price payable by the Qualified Homebuyer for a Type C Agency Lot shall not be
subject to an Affordable Housing Cost sales price restriction or limitation.
(b) The disposition of each completed New Home to the Qualified
Homebuyer designated by the Developer shall take place through a New Home Escrow to be
administered by the Escrow Holder. The New Home Escrow shall be deemed open ("Opening of
New Home Escrow") upon delivery of a fully executed copy of the Agency License Agreement
to the Escrow Holder. The Escrow Holder shall promptly confirm to the parties the escrow
number and the title insurance order number assigned to such escrow. The Escrow Holder shall
be a title company or escrow service as acceptable to the Developer and the Qualified
Homebuyer.
(c) The Developer shall deliver to the Agency the information relating to each
Qualified Homebuyer described in Section 2(e) of the Section 33334.3 Covenant, within five (5)
calendar days following the Developer's designation of such Qualified Homebuyer as the
prospective purchaser of the completed New Home in the case of a New Home constructed on
the Type A Agency Lot or a Type B Agency Lot,. Concurrently upon the Developer's delivery
LO the Agency of the household income and occupancy information described in Section 2(e) of
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the Section 33334.3 Covenant, the Developer shall also request that the Agency issue its Notice
of Agency Concurrence with respect to the Qualified Homebuyer designated by the Developer.
Within ten (10) calendar days following its receipt of such written information and request from
the Developer relating to the Qualified Homebuyer, the Agency shall provide the Developer with
a preliminary confirmation of the approval or rejection of the income and household occupancy
qualifications of the proposed Qualified Homebuyer. In the event that the Agency may request
additional information relating to the confirmation of the matters described in the preceding
sentence with respect to the Qualified Homebuyer, the Developer shall cause such additional
information to be provided to the Agency as promptly as feasible. The Executive Director of the
Agency shall issue a preliminary determination of his concurrence of the eligibility of the
Qualified Homebuyer within ten (10) calendar days following receipt of such completed income
and household occupancy information. Provided that the proposed Qualified Homebuyer also
qualifies to obtain purchase money mortgage financing for the purchase of the completed New
Home with terms and costs not in excess of an Affordable Housing Cost for such Qualified
Homebuyer, as evidenced by a written mortgage lender's prequalification for such Qualified
Homebuyer within sixty (60) calendar days following the Executive Director's preliminary
concurrence of the eligibility of the Qualified Homebuyer designated by the Developer, the
Executive Director of the Agency shall issue a Notice of Agency Concurrence with respect to
such Qualified Homebuyer to the Escrow Holder. In the event that the Agency may later
discover that the written information provided to it in support of a request for issuance of a
Notice of Agency Concurrence is false or incorrect in any material respect, then in such event the
Agency may exercise all of its remedies to enforce the provisions of this Agreement and the
Section 33334.3 Covenant, if applicable, notwithstanding the fact that a Notice of Agency
Concurrence may have been issued in favor of a particular Qualified Homebuyer.
Upon the completion of improvement of each New Home, the Developer shall
sell such New Home to a Qualified Homebuyer shall be transferred to such Qualified
Homebuyer through a New Home Escrow. The Agency shall not be a party to any such New
Home Escrow. Notwithstanding the preceding sentence, the Developer shall instruct the Escrow
Holder to comply with the provisions of Section 4.02(e) of this Agreement and at the close of
each New Home Escrow, the Escrow Holder shall provide the Agency with a copy of both the
"seller's" and the "buyer's" closing statement, together with a complete copy of the real estate
sales agreement between the Developer and the Qualified Homebuyer for the New Home.
(d) The Developer and the Agency mutually covenant and agree to execute all
necessary or appropriate written escrow instructions relating to the application of this Agreement
to a particular New Home Escrow as may be reasonab.ly requested by the Escrow Holder in
connection with the administration of a New Home Escrow.
(e) Each New Home Escrow shall close upon satisfaction of the applicable
escrow conditions by and between the Developer and such Qualified Homebuyer as consistent
with this Agreement when the Escrow Holder confirms that:
(i) it is in receipt of the Notice of Agency Concurrence for the Qualified
Homebuyer in the case of a New Home constructed on either a Type A
Agency Lot or a Type B Agency Lot;
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(ii) it has received and is in a position to record a fully executed form of the
Section 33334.3 Covenant for the New Home in the case of a New Home
constructed on either a Type A Agency Lot or a Type B Agency Lot;
(iii) it is in a position to provide the Agency within a policy of title insurance
in favor of the Agency which insures that the Section 33334.3 Covenant is
subject only to the lien for property taxes and the lien in the New Home of
the senior purchase money mortgage lender to the Qualified Homebuyer in
the case of a New Home constructed on either a Type A Agency Lot or a
Type B Agency Lot;
(iv) in the case of a New Home constructed on a Type B Agency Lot, the
Developer has provided the Agency with a preliminary indication of the
New Home Sale Costs for such Type B Agency Lot and the Agency shall
have issued to the Escrow Holder of the pay-off amount, if any, for the
Agency Lot Promissory Note and release of the Agency Deed of Trust for
such Type B Agency Lot;
(v) the Qualified Homebuyer has executed all of the Agency MAP documents
relating to the Agency Downpayment Assistance, if any, provided by the
Agency to such Qualified Homebuyer;
(vi) it is in a position to comply with such other instructions of the Developer,
the Qualified Homebuyer and the senior purchase money mortgage lender
relating to the New Home.
(f) In the event that a New Home Escrow may fail to close for any reason, the
Developer may cause such New Home Escrow to be cancelled without further notice of
instruction to the Agency. The Developer shall pay for all of the costs and expenses of such a
cancelled New Home Escrow and shall indemnify, defend and hold the Agency harmless from
any.claim, loss or damage which may be asserted or arise against the Agency by a third party as
a result of the cancellation of any such escrow.
(g) Within sixty (60) days following the close of a New Home Escrow for a
Type B Agency Lot, the Developer shall deliver its New Home Sale Costs Certificate to the
Agency, together with adjustment, if any, which is indicated to the amount of the Agency Lot
Purchase Price payable for such Type B Agency Lot.
Section 4.03. Maintenance of the Agency Lots. The Developer covenants and
agrees for itself, its successors, and assigns to maintain the each of the Agency Lots in a good
condition free from any accumulation of debris or waste material, subject to normal construction
job-site conditions, and shall. maintain in a neat, orderly, healthy and good condition the
landscaping on each Agency Lot required to be planted in accordance with the Scope of
Development. In the event the Developer, or its successors or assigns, fails to perform the
maintenance as required herein, the Agency shall have the right, but not the obligation, to enter
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any Agency Lot and undertake, such maintenance activities. In such event, the Developer shall
reimburse the Agency for all reasonable sums incurred by it for such maintenance activities. The
obligation of the Developer under this Section 4.03 with respect to the Agency Lots shall Dt'
discharged for each Agency Lot on the applicable Delivery Date for such Agency Lot, as
improved with a New Home.
Section 4.04. Obligation to Refrain from Discrimination. The Developer
covenants and agrees for itself, its successors, its assigns and every successor in interest to each
of the Agency Lots, that there shall be no discrimination against or segregation of any person, or
group of persons, on account of sex, marital status, race, color, religion, creed, national origin or
ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of any Agency
Lot; nor shall the Developer, itself or any person claiming under or through it, 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, sublessee or vendees of the
Agency Lots.
Section 4.05. Form of Nondiscrimination and Nonsegregation Clauses. The
Developer covenants and agrees for itself, its successors, its assigns, and every successor in
interest to the Agency Lots, and each of them, or any part thereof, that the Developer, such
successors and such assigns shall refrain from restricting the sale, lease, sublease, rental, transfer,
use, occupancy, tenure or enjoyment of each of the Agency Lots and each of the New Homes, on
the basis of sex, marital status, race, color, religion, creed, ancestry or national origin of any
person. All deeds, leases or contracts pertaining thereto shall contain or be subject to
substantially the following nondiscrimination or nonsegregation clauses:
(a) In deeds: "The grantee herein covenants by and for itself, its successors 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 or any person claiming
under or through it, 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, sublessee, or vendees in the
premises herein conveyed. The foregoing covenants shall run with the land."
(b) In leases: "The Lessee herein covenants by and for itself, its successors and
assigns, and all persons claiming under or through them, 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 itself, or any person
claiming under or through it, establish or permit any such practice or practices of
discrimination or segregation with reference to the selection, location, number,
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use, or occupancy, of tenants lessees, sublessee, subtenants, or vendees in the
premises herein leased."
(c) 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 herein conveyed or leased, nor
shall the transferee or any person claiming under or through it, 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 the premises herein transferred." The foregoing
provision shall be binding upon and shall obligate the contracting party or parties
and any subcontracting party or parties, or other transferees under the instrument.
Section 4.06. Effect and Duration of Covenants Under Section 4.01 and Section
4.05. The covenants established under Section 4.05 against discrimination shall remain in effect
in perpetuity. The covenant respecting uses and occupancy of each of the New Homes which are
designated by the Developer to be initially occupied by a Qualified Homebuyer as set forth in
Section 4.01(a), shall remain in effect for the Qualified Residence Period of each such New
Home, and shall run with the land and shall constitute equitable servitudes thereon, and shall,
without regard to technical classification and designation, be binding for the benefit and in favor
of the Agency, its successors and assigns and the City.
The Agency is deemed the beneficiary of the terms an prOVISiOns of this
Agreement and of the covenants running with the land for and in its own rights and for the
purposes of protecting the interests of the community. The Agency shall have the right, if such
covenants are breached, to exercise all rights and remedies and to maintain any actions or suits at
law or in equity or such other proper proceedings to enforce the curing of such breaches to which
it or any other beneficiary of such covenants may be entitled, including, without limitation, to
specific performance, damages and injunctive relief. The Agency shall have the right to assign
all of its rights and benefits hereunder to the City.
Section 4.07. Proiect Development Cost Pro Forma.
(a) As of the Effective Date of this Agreement, the Developer has presented
the Agency with a Project development cost pro forma as on file with the Agency. The Agency
shall make the Agency Lots available to the Developer upon its issuance of one or more Notice,S
of Availability for Transfer based upon the Project development cost estimate presented by the
Developer in the Project development cost pro forma.
(b) Upon the request of the Agency (but not more frequently than once every
180 days during the terms of this Agreement) and at such other times as the Developer may in its
discretion elect, the Developer shall modify or update the previously submitted Project
development cost pro forma, and such updated Project development cost pro forma shall be used
by the Agency staff in the preparation of its report under Section 1.05(c) for the preparation of
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one or more Notices of Availability for Transfer which may be issued at any time following the
issuance by the Agency of the initial Notice of Availability for Transfer.
(c) The Developer shall maintain accounting books and records of Project
development costs incurred in accordance with generally accepted principles of business
accounting. The Agency and its accountants and auditors shall have the right to conduct, at its
expense, an inspection and review of the accounting books and records of the Developer relating
to the Project upon the request of the Agency. The Developer shall cooperate with the Agency in
the production of its accounting books and records as reasonably required by the Agency and its
auditors to conduct an audit of actual Project development costs.
Section 4.08. Agency Downpavrnent Assistance.
(a) As of the Effective Date, the Agency shall appropriate and reserve the sum
of Five Hundred Thousand Hundred Dollars ($500,000) from the Agency Low and Moderate
Income Housing Fund to provide Agency Downpayment Assistance to Qualified Homebuyers of
the Agency Lots. Agency Downpayment Assistance may hereafter be provided to Qualified
Homebuyers upon the close of each New Home Escrow for a completed New Home on an
Agency Lot, subject to the terms and conditions of the Agency Map Program and the
underwriting and credit evaluation by the Agency of each such Qualified Homebuyer.
(b) Provided that a Qualified Homebuyer is determined by the Agency to be
eligible for Agency Downpayment Assistance, as part of its acquisition of a completed New
Home upon the close of the New Home Escrow, such Qualified Homebuyer shall execute a
promissory note, deed of trust, and related Agency Downpayment Assistance loan documents as
the Agency may direct.
(c) The amount, if any, of the Agency Downpayment Assistance, which may
be provided to one or more Qualified Homebuyers shall not exceed more than twenty percent
(20%) of the Completed New Home Purchase Price payable by any Qualified Homebuyer, and
shall be disbursed for the account of such Qualified Homebuyer through the applicable New
Home Escrow.
(d) The Agency may in its discretion provide, or make available, additional
sums to pay for Agency Downpayment Assistance, in addition to the amount as specifically
referred and set aside under Section 4.08(a), above.
(e) Notwithstanding any other provision of this Section 4.08, the Agency shall
have no obligation to fund any Agency Downpayment Assistance loan for a Qualified
Homebuyer of a Completed New Home on any Agency Lot after March 31, 2007.
Section 4.09. Agency Participation in New Home Profit.
(a) For the purposes of this Section 4.09, the words "New Home Profit" mean
and refer to a sum which shall be determined in accordance with the following formula: .
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(Completed New Home Purchase Price) - (New Home Sales Costs + Agency Lot
Purchase Price) = New Home Profit
(b) The Developer hereby agrees to pay the Agency fifty percent (50%) of the
New Home Profit realized by the Developer upon the sale of each Completed New Home to a
Qualified Homebuyer, if any, at the close of each New Home Escrow for each Completed New
Home constructed on each Type A Agency Lot and on each Type B Agency Lot. The New
Home Profit payment of the Developer to the Agency shali be an amount which is in addition to
the sum payable by the Developer to the Agency as the Agency Lot Purchase Price.
(c) The Developer shali pay the Agency the applicable amount of the New
Home Profit within sixty (60) days of the close of each New Home Escrow.
(d) Concurrently with the payment to the Agency of the applicable amount of
the New Home Profit, the Developer shali also prepare and deliver to the Agency its New Home
Sales Costs Certificate for the Completed New Home constructed on such Agency Lot. The
Agency shali have the right to conduct and complete a financial audit of the information
presented in the New Home Sales Costs Certificate at the expense of the Agency in accordance
with generally accepted accounting principles, within ninety (90) days foliowing its receipt of
each such New Home Sales Costs Certificate. The Developer shali cooperate with the Agency
and its agents in the conduct of any such audit of the financial information set forth in each such
New Home Sales Costs Certificate, including the delivery to the Agency upon request of
underlying construction or service contracts and invoices for services performed or products
delivered to the Developer by third parties relating to the Project. In the event that based upon
such audit the new Home Sales Costs Certificate, the Agency may reasonably determine that an
adjustment is indicated in the New Home Profit amount payable to the Agency by the Developer,
then in such event, the Developer shali pay such difference to the Agency within thirty (30) days
foliowing written demand by the Agency.
ARTICLE V
DEFAULTS. REMEDIES AND TERMINATION
Section 5.01. Defaults - General.
(a) Subject to the extensions of time set forth in Section 6.05 hereof, failure or
delay by either party to perform any term or provision of this Agreement shali constitute a
default under this Agreement; provided, however, that if a party otherwise in default commences
to cure, correct or remedy such default within thirty (30) calendar days after receipt of written
notice specifying such default and shali diligently and continuously prosecute such cure,
correction or remedy to completion (and where any time limits for the completion of such cure,
correction or remedy are specificaliy set forth in this Agreement, then within said time limits),
such party shali not be deemed to be in default hereunder.
(b) The injured party shali give written notice of default to the party in
default, specifying t.l1e default complained of by the non-defaulting party. Delay in giving such
notice shall not constitute a waiver of any default nor shali it change the time of default.
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(c) Any failure or delays by either party in asserting any of its rights and
remedies as to any default shall not operate as a waiver of any default or of any such rights or
remedies. Delays by either party in asserting any of its rights and remedies shall not deprive
either 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.
Section 5.02. Legal Actions.
(a) 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 purposes 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 in the Central District of
California.
(b) The laws of the State of California shall govern the interpretation and
enforcement of this Agreement.
(c) In the event that 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
Executive Director or Chairman of the Agency, or in such other manner as may be provided by
law.
(d) In the event that any legal action is commenced by the Agency against the
Developer, service of process on the Developer shall be made by personal service on George
Jordan (or such other agent for service of process and at such address as may be specified in
written notice to the Agency), or in such other manner as may be provided by law, and shall be
valid whether made within or without the State of California.
Section 5.03. Rights and Remedies are Cumulative. Except with respect to any
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.
Section 5.04. Damages If either party defaults with regard to any provision of
this Agreement following the Effective Date, the non-defaulting party shall serve written notice
of such default upon the defaulting party. If the defaulting party does not diligently commence
to cure such default within thirty (30) calendar days after service of the notice of default and
promptly complete the cure of such default within a reasonable time, not to exceed ninety (90)
calendar days (or such shorter period as may otherwise be specified in this Agreement for any
specific default), after the service of written notice of such default, the defaulting party shall be
liable to the other party for damages caused by such default.
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Section 5.05. Agency Audit Costs. In the event that based upon the results of its
audit of the Developer's New Home Sales Costs Certificate under either Section 2.17 or Section
4.09, the Agency may reasonably determine that the amount owed, if any, to the Agency by the
Developer under either such section, is more than ten percent (10%) of the amount estimated by
the Developer at the time when such New Home Sales Costs Certificate is delivered to the
Agency then in such event in addition to any other sums as may then be payable by the
Developer to the Agency, the Developer shall also reimburse the Agency for the reasonable costs
of the Agency incurred in connection with the Agency's audit of the New Home Sales Costs
Certificate, within thirty (30) days following the Agency's written request for such
reimbursement.
ARTICLE VI
GENERAL PROVISIONS
Section 6.01. Notices, Demands and Communications Between the Parties.
(a) Any and all notices, demands or communications submitted by any party
to another party pursuant to or as required by this Agreement shall be proper if in writing and
dispatched by messenger for immediate personal delivery, or by registered or certified United
States mail, postage prepaid, return receipt requested, to the principal office of the Agency and
the Developer, as applicable, as designated in Section 1.05(a) and Section 1.05(b) 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 as provided in this Section. Any such
notice, demand or communication shall be deemed to be received by the addressee, regardless of
whether or when any return receipt is received by the sender or the date set forth on such return
receipt, on the day that it is dispatched by messenger for immediate personal delivery, or two (2)
calendar days after it is placed in the United States mail as heretofore provided.
(b) In addition to the submission of notices, demands or communications to
the parties as set forth above, copies of all notices shall also be delivered by facsimile as follows:
to the Developer:
George Jordan
Meadowbrook Park Homes, Inc.
10702 Hathaway Drive
Suite No.1
Santa Fe Springs, CA 90670
FAX: (562) 777-7808
with copy to:
William Holzwarth
Gresham Savage Nolan & Tilden
5500 East Hospitality Lane
Suite 300
San Bernardino. CA 92408
FAX: (909) 890-9690
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to the Agency:
Redevelopment Agency of the City
of San Bernardino
201 North "E" Street
Suite 301
San Bernardino, CA 92401
FAX: (909) 888-9413
with copy to:
Lewis Brisbois Bisgaard & Smith LLP
650 East Hospitality Lane
Suite 600
San Bernardino, CA 92408
FAX: (909) 387-1138
Section 6.02. Conflict of Interest. No member, official or employee of the
Agency having any conflict of interest, direct or indirect, related to this Agreement, or in the
development of the Site, shall participate in any decision relating to this Agreement. The parties
represent and warrant that they do not have knowledge of any such conflict of interest.
Section 6.03. 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. Third parties, for the purposes of
this Section, shall not include persons to whom fees are paid for professional services if rendered
by attorneys, financial consultants, accountants, engineers, architects and the like when such fees
are considered necessary by the Developer.
Section 6.04. Nonliabilitv of Agencv Officials and Emplovees. No member,
official or employee of the Agency shall be personally liable to the Developer, or any successor
in interest, in the event of any default or breach by the Agency or for any amount which may
become due to the Developer or to its successor, or on any obligations under the terms of this
Agreement, except for gross negligence or willful acts of such member, officer or employee.
Section 6.05. Enforced Delav: Extension of Time of Performance. In addition to
specific provisions of this Agreement, performance by either party hereunder shall not be
deemed to be in default, or considered to be a default, where delays or defaults are due to the
force majeure events of war, insurrection, strikes, lockouts, riots, floods, earthquakes, fires,
casualties, acts of God, acts of the public enemy, epidemics, quarantine restrictions, freight
embargoes or lack of transportation, weather-caused delays, inability to secure necessary labor,
materials or tools, delays of any contractors, subcontractor or supplier. which are not attributable
to the fault of the party claiming an extension of time to prepare or acts or failure to act of any
public or governmental agency or entity (provided that acts or failure to act of the City or
Agency shall not extend the time for the Agency to act hereunder except for delays associated
with lawsuit or injunction including but without limitation to lawsuits pertaining to the approval
of the Agreement, and the like). An extension of time for any such force majeure cause shall be
for the period of the enforced delay and shall commence to run from the date of occurrence of
the delay; provided however, that the party which claims the existence of the delay has first
provided the other party with written notice of the occurrence of the delay within ten (10) days of
the commencement of such occurrence of delay.
The inability of the Developer to obtain a satisfactory commitment from a
construction lender for the improvement of the Project or to satisfy any other condition of this
Agreement relating to the redevelopment of the Agency Lots, if applicable, shall not be deemed
4853-1265-2544.6
45
1/3/05
p IAJCTIdas'^lcnda Anxhmmtl\Apn'U-Amcnd 200SIOS.(lj.IO ANR.200S Meadowtrook DDA_doc:
to be a force majeure event or otherwise provide grounds for the assertion of the existence of a
delay under this Section 6.05. The parties hereto expressly acknowledge and agree that changes
in either general economic conditions or changes in the economic assumptions of any of them
which may have provided a basis for entering into this Agreement and which occur at any time
after the execution of this Agreement, are not force majeure events and do not provide any party
with grounds for asserting the existence of a delay in the performance of any covenant or
undertaking which may arise under this Agreement. Each party expressly assumes the risk that
changes in general economic conditions or changes in such economic assumptions relating to the
terms and covenants of this Agreement could impose an inconvenience or hardship on the
continued performance of such party under this Agreement, but that such inconvenience or
hardship is not a force majeure event and does not excuse the performance by such party of its
obligations under this Agreement.
Section 6.06. Inspection of Books and Records. The Agency shall have the right
at all reasonable times at the Agency's cost and expense to inspect the books and records of the
Developer pertaining to the Project, as necessary for the Agency, in its reasonable discretioJl, to
enforce its rights under this Agreement. Matters discovered by the Agency shall not be disclosed
to third parties unless required by law or unless otherwise resulting from or related to the pursuit
of any remedies or the assertion of any rights of the Agency hereunder. The Developer shall also
have the right at all reasonable times to inspect the books and records of the Agency pertaining
to the Site and/or the development thereof as pertinent to the purposes of this Agreement.
Section 6.07. Approvals.
(a) Except as otherwise provided in this Agreement, approvals required of the
Agency or the Developer, or any officers, agents or employees of either the Agency or the
Developer, shall not be unreasonably withheld and approval or disapproval shall be given within
the time set forth in the Schedule of Performance or, if no time is given, within a reasonable
time.
(b) The Executive Director of the Agency is authorized to sign on his or her
own authority amendments to this Agreement which are of routine or technical nature, including
minor adjustments to the Schedule of Performance.
Section 6.08. Real Estate Commissions. The Agency shall not be liable for any
real estate commissions, brokerage fees or finder fees which may arise or be purported to arise
from or related to this Agreement. .
Section 6.09. Indemnification. The Developer agrees to indemnify and hold the
City, the Agency, and the elected officers, officials, employees, attorneys and agents of both of
them, harmless from and against all damages, judgments, costs, expenses and fees arising from
or related to any act or omission of the Developer in performing its obligations hereunder. The
Agency agrees to indemnify and hold the Developer and its officers, employees and agents,
harmless from and against all damages, judgments, costs, expenses and fees arising from or
related to any act or omission of the Agency in performing its obligations hereunder.
4853-1265-2544.6
46
1/3/05
P\Aicndu'AJenOa AnaduneNs\Aamu-Ammd 200S\05..o1-IO ANR.200S Meadowbrook. DDA_OOc
Section 6.10. Attornevs' Fees. If either party hereto files any action or brings
any action or proceeding against the other arising out of this Agreement, or is made a party to
any action or proceeding brought by the Escrow Holder or a third party, then as between the
Developer and the Agency, the prevailing party shall be entitled to recover as an element of its
costs of suit, and not as damages, its reasonable attorneys' fees as fixed by the Court, in such
action or proceeding or in a separate action or proceeding brought to recover such attorneys' fees.
For the purposes hereof the words "reasonable attorneys' fees" mean and include in the caSe of
the Agency to salaries and expenses of the lawyers employed by the Office of City Attorney
(allocated on an hourly basis) who may provide legal services to the Agency in connection with
the representation of the Agency in any such matter.
Section 6.11. Effect. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective heirs, executors, administrators, legal
representatives, successors and assigns.
ARTICLE VII
ENTIRE AGREEMENT. WAIVERS AND AMENDMENT
Section 7.01. Entire Agreement.
(a) This Agreement shall be executed in two (2) originals each of which is
deemed to be an original. This Agreement includes _ pages and U attachments
(See list of attachments at Section 1.05), which constitute the entire understanding and
Agreement of the parties.
(b) All waivers of the provIsIons of this Agreement and all amendments
hereto must be in writing and signed by the appropriate representations of the Agency and the
Developer.
4853-1265-2544.6
47
1/3/05
P 'A,cndas\A.cnda Anachmenu\AJrTTU-Amend 200S\OS-OI-IO ANR.2005 Meadowbrook OOAOOc
IN WITNESS WHEREOF. the parties hereto have duly executed this Agreement
as of the dates set forth below.
AGENCY
Redevelopment Agency of the
City of San Bernardino
Date:'
Bv:
Agency Chair
By:
Agency Executive Director
APPROVED AS TO FORM:
..cJ!Jtkwfl ~)
Agency c~sel
DEVELOPER
Meadowbrook Park Homes. Inc.. a California
corporation
Date:
By:
-1853-1265-25-1-16
1305
48
I\: \\IT\:LSS \\IIEREOl-. the parties hereto have duly executed this Agreement
as of the dates set forth helcl\\
AGE:\CY
Redewlopment Agency of the
City of San Bernardino
Date:
B\:
Agency Chair
By:
:\gency Executive Directllr
APPROVED AS TO FOR\1:
Agency Cl)unsel
DE\-ELOPER
\1eado\\Drook Park Homes. Inc.. a California
corporation
Date:
By:
-!~:'.'-l =n:'.:~4-J h
; .:115
-18
1'\ WIT'\I:SS \"HEREOF. the parties hereto ha\e duly executed this Agreement
as of the dates set forth hchm,
AGENCY
Rede\elopment Agency of the
City of San Bernardino
Date:
By
Agency Chair
B\:
Agency Executi\e Director
APPROVED AS TO FOR\l:
Agency Counsel
DEVELOPER
\feado\\brook Park Homes. Inc,. a California
corporation
Date:
By:
JX:' 3~ 1211~.:~~~ f'1
: _~ (I)
-l8
4853-1265-25446
Jl3/05
EXHIBIT "A"
VICINITY MAP OF NEIGHBORHOOD RESTORA nON AREA
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EXHIBIT "B"
FO~\1 OF NOTICE OF A V AlLABILITY FOR TRANSFER OF AGENCY LOT(S) -
INCLUDING FORM OF AGENCY LICENSE AGREEMENT AND FORM OF DEVELOPER
DUE DILIGENCE APPROVAL CERTIFICATE FOR INDIVIDUAL AGENCY LOT(S)
485~-1265-25~.5
12 28.,'04
50
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
NOTICE OF AVAILABILITY FOR TRANSFER
(Meadowbrook Park Homes, Inc.: Neighborhood Restoration Area
THIS NOTICE OF A V AILABILITY FOR TRANSFER NO. (the "Notice") is
dated as of , and is issued by the Redevelopment Agency of the City of San
Bernardino (the "Agency") to Meadowbrook Park Homes. Inc., a California corporation (the
"Developer") pursuant to Section 2.02 of the 2004 Meadowbrook Single Family Residential
Development Agreement (the "Agreement") in light of the following:
INTRODUCTION
The Developer is undertaking certain new single family housing residential improvements in
the Neighborhood Restoration Area in accordance with this Agreement.
The Mayor and Common Council of the City of San Bernardino (the "City") and the governing
board of the Agency have previously conducted a public hearing in which the Agency has been
authorized to issue this Notice to the Developer.
As of the date of this Notice, no default exists under the Agreement, and accordingly, the
Executive Director of the Agency has issued this Notice to the Developer.
Unless the context of usage of a particular term or phrase in this Notice may otherwise require,
the meaning of defined terms used in this Notice, shall be the same as set forth in the Agreement.
This Notice is organized into four (4) separate parts:
INTRODUCTION -- sets forth the date of this Notice and the return dates for PART ONE.
PART TWO and PART THREE of this Notice;
PART ONE
includes an identification of the Agency Lot subject to this Notice and
designates the Agency Lot Transfer Escrow Holder;
PART TWO --
contains a license agreement permitting the Developer to conduct certain
investigations of the Agency Lot identified in PART ONE;
PART THREE--
Developer Due Diligence Acceptance Certificate for the Agency Lot
identified in PART ONE.
The Developer shall indicate its receipt of this Notice by executing PART ONE of this Notice
at the place indicated below. Within thirty (30) days following the date of this Notice, the Developer
shall complete PART TWO of the Notice for the Agency Lot identified in PART ONE and the
Developer shall execute and return the signature page of PART TWO to the Agency together with each
accompanying exhibit to the Agency Lot Investigation Work. Upon acceptance of PART TWO of this
~otice by the Agency, as evidenced by the signature of the Agency Executive Director, the Developer
may enter the Agency Lot identified in PART ONE and conduct such due diligence investigation as
~8.w-2333-00481
1
may then be indicated. Within sixty (60) days following the date of this Notice, the Developer shall
execute and return the signature page of P ART THREE of this Notice to the Agency Lot Transfer
Escrow Holder and to the Agency.
.j8~-:333-DQ.l8.1
2
-- PART ONE-
Section 1.
The Agency Lot is hereby designated as:
Assessor Parcel No.
Section 2. A legal description of the Agency Lot is included in the preliminary title report
for the Agency Lot attached hereto as Attachment No. I. The preliminary title report has been issued
by under its title insurance order number . The
title officer in this transaction is (909) - .
--
Section 3. The Agency hereby designates to serve as the
Agency Lot Transfer Escrow Holder. The contact information for the Agency Lot Transfer Escrow
Holder is
A copy of the Agency Lot Transfer Escrow Holder's standard escrow agreement is attached hereto as
Attachment No.2. The Developer is directed to executed Attachment No.2 at the place indicated and
return an executed copy of Attachment No.2 to the Executive Director of the Agency together with the
Developer's signature of page _ of this Notice.
Section 4. This Notice shall have no further force or effect unless the Developer
acknowledges its acceptance of this Notice at the place indicated below in this PART ONE, and has
returned its executed copy of this PART ONE to the Executive Director of the Agency within ten (10)
days following the date of this Notice. The date of this Notice is indicated next to the signature of the
Executive Director of the Agency which appears below.
AGENCY
Redevelopment Agency of the City of San
Bernardino
Date: _
By:
Executive Director
DEVELOPER
Meadowbrook Park Homes, Inc.
Date:
By:
~8.w.:333-0048.1
3
- PART TWO-
PART TWO OF THIS NOTICE OF AVAILABILITY FOR TRANSFER is a License
Agreement Permitting Limited Entry For Investigation of Environmental. Soils Geotechnical and
Other Conditions and this PART TWO License affects the Agency Lot identified in PART ONE of this
.Notice.
Section 1.
Definitions.
In addition to the definitions of certain words found in PART ONE of this Notice certain other
words or phrases as set forth in this Section 1 ofP ART TWO shall have the meanings set forth below:
. the term "ACM" means and refers to asbestos containing materials as this term is
defined in Labor Code Section 6501.8. The term ACM also refers to asbestos
containing wastes to the extent that asbestos may be present on or beneath the surface of
the Property and not as part of any structure thereon. "ACM Investigation and Testing"
refers to the visual inspection and the limited invasive testing and sampling of building
materials on the Agency Lot(s) for the presence of ACMs;
. the term "Consultant" or "Consultants" refers to any person or entity that the Developer
retains to conduct any Agency Lot Investigation Work on the Agency Lot;
. the term "Environmental Consultant" means the firm (or firms) of licensed consulting
engineers that the Developer represents and warrants to the Agency is qualified under
Environmental Laws and applicable State of California professional licensing standards
and regulations to conduct each of the investigation work items checked in the boxes
next to Section 2(b)(1) through (5), as applicable;
. the term "Environmental Laws" means all federal, state, local, or municipal laws, rules,
orders, regulations, statutes, ordinances, codes, decrees, or requirements or any
government authority regulating, relating to, or imposing liability or standards of
conduct concerning any Hazardous Substance (as later defined), or pertaining to
occupational health or industrial hygiene (to the extent that the occupational health or
industrial hygiene laws, ordinances, or regulations relate to Hazardous Substances on,
under, or about the Agency Lot), occupational or environmental conditions on, under, or
about the Property, as now or may at any later time be in effect, including without
limitation, the Comprehensive Environmental Response, Compensation and Liability
Act of 1980 ("CERCLA") [42 USC Section 9601 et seq.]; the Resource Conservation
and Recovery Act of 1976 ("RCRA") [42 USC Section 6901 et seq.]; the Clean Water
Act, also known as the Federal Water Pollution Control Act ("FWPCA") [33 USC
Section 1251 et seq.]; the Toxic Substances Control Act ("TSCA") [15 USC Section
2601 et seq.]; the Hazardous Materials Transportation Act ("HMTA") [49 USC Section
1801 et seq.]; the Insecticide, Fungicide, Rodenticide Act [7 USC Section 6901 et seq.]
the Clean Air Act [42 USC Section 7401 et seq.]; the Safe Drinking Water Act [42 USC
Section 300f et seq.]; the Solid Waste Disposal Act [42 USC Section 6901 et seq.]; the
Surtace Mining Control and Reclamation Act [30 USC Section 101 et seq.]; the
Emergency Planning and Community Right to Know Act [42 USC Section 11001 et
seq.]; the Occupational Safety and Health Act [29 USC Section 655 and 657]; the
~R44.:333-00481 4
California Underground Storage of Hazardous Substances Act [Health and Safety Code
Section 25288 et seq.]; the California Hazardous Substances Account Act [Health and
Safety Code Section 25300 et seq.]; the California Safe Drinking Water and Toxic
Enforcement Act [Health and Safety Code Section 24249.5 et seq.] the Porter-Cologne
Water Quality Act [Water Code Section 13000 et seq.] together with any amendments
of, or regulations promulgated under the statutes cited above and any other federal,
state, or local law, statute, ordinance, or regulation, now in effect or later enacted, that
pertains to occupational health or industrial hygiene, and only to the extent the
occupational health or industrial hygiene laws, ordinances, or regulations relate to
hazardous substances on, under, or about the Agency Lot, or the regulation or protection
of the environment. including ambient air. soil. soil vapor. groundwater. surface water.
or land use;
. the term "Geotechnical Consultant" means the firm (or firms) of geotechnical
consulting engineers who the Developer represents and warrants to the Agency is
qualified under applicable State of California professional licensing standards and
regulations to conduct the Agency Lot Investigation Work checked in the box next to
Section 2(b)(1);
. the term "Hazardous Substance," means and includes without limitation:
those substances included within the definitions of "hazardous substance," "hazardous
waste." "hazardous material," "toxic substance," "solid waste," or "pollutant or
contaminate" in CERCLA. RCRA, TSCA. HMT A. or under any other environmental
law; and
those substances listed in the United States Department of Transportation (DOT)Table
[49 CFR 172.101], or by the EPA, or any successor agency, as hazardous substances
[40 CFR Part 302]; and
other substances, materials, and wastes that are, or become, regulated or classified as
hazardous or toxic under federal, state, or local laws or regulations; and
any material, waste, or substance that is:
(1)
a petroleum or refined petroleum product,
(2)
asbestos,
(3)
polychlorinated biphenyl,
(4)
designated as a hazardous substance pursuant to 33 USC Section 1321 or listed
pursuant to 33 USC Section 1317,
(5)
a flammable explosive, or
(6)
a radioactive material;
~S.w-2333-0048.1
5
. the term "H&S Plan" means and refers to the written health and safety plan to be
prepared by each Consultant prior to the implementation of fieldwork of investigation
or testing on the Agency Lot, if such an H&S Plan is required under applicable
Environmental Laws. The H&S Plan shall identify the specific safety procedures and
equipment to be used by the Consultant, and all of its subcontractors and employees.
and shall identify and address potential hazards which may be encountered on the
Agency Lot during the course of the Agency Lot Investigation Work. Depending upon
the number of Consultants employed by the Developer, there may be more than one
H&S Plan that must be prepared and filed with the Agency prior to the commencement
of Agency Lot Investigation Work on the Agency Lot under Section 6(a);
. the term "LBP" means and refers to lead-based paint, as this term is defined at 42 USC
Section 4852 and 40 CFR Part 745. "LBP Investigation and Testing" refers to the
visual inspection and the limited invasive testing and sampling of building materials on
the Agency Lot for the presence of LBP.
. the term "Other Work Consultant" means and refers to the firm that will perform any
item of investigation work on the Agency Lot relating to the miscellaneous
investigation work described in Section 2(b)(5). The Developer represents and warrants
to the Agency that each of the Other Work Consultant(s) is qualified under applicable
law to perform such work;
. the term "Phase I Environmental Assessment Report" means a report relating to the
environmental condition of the Agency Lot prepared by the Environmental Consultant
in accordance with "ASTM Phase I Environmental Site Assessment Standard Practice E
1521" or other standard for testing materials that is acceptable to the Developer. The
Phase I Environmental Assessment Report shall be addressed to the Developer;
. the term "Phase II Environmental Assessment Work" means the invasive testing and
investigation of the Property to be undertaken by the Environmental Consultant subject
to the terms and conditions of this PART TWO License. The scope of the Phase II
Environmental Assessment Work shall be specifically described to the Agency prior to
the commencement of any such work on the Agency Lot, as provided in Section 6;
. the term "Phase II Report" means the written report prepared by the Environmental
Consultant addressed to the Developer in which the Environmental Consultant presents
its findings and recommendations relating to the results of the Phase II Environmental
Assessment Work on the Agency Lot.
Section 2. Specific Identification and Description of A!!encv Lot Investi!!ation Work
and Emer!!encv Contact List and Special Conditions.
(a) The Developer represents and warrants to the Agency that each of its Consultants has
been provided with a copy of this PART TWO License, prior to commencing any work on the Agency
Lot.
(b) Subject to the terms and conditions set forth herein, this PART TWO License authorizes
the Developer and each of its Consultants to enter the Agency Lot to conduct the inspection, work,
.JS-W-2333.o048.!
6
Each of the work agreements identified above is/are assembled as part of Exhibit "8" to this
PART TWO License.
(c) If the Executive Director of the Agency has checked the box in this Section 2(c), certain
special conditions apply to this PART TWO License, which are specifically noted in Exhibit "C.
~ Special Conditions
SEE EXHIBIT "C" _ pages. attached
(d) A telephone contact roster for the Developer and for each of its Consultants identified in
Section 2(b) is attached as Exhibit "D" to this PART TWO License. The telephone contact roster
includes 24 hour emergency telephone numbers for each Consultant/field investigation principal of the
Consultant. The Developer is responsible for promptly providing the Agency with notice of any
changes to such emergency contact information, including any changes as may be required for_a H&S
Plan, prior to commencement of fieldwork on the Agency Lot.
Section 3.
Notice of LBP And ACM in the Ae:encv Lot(s) And Disclaimer.
The Agency Lot may presently include improvements constructed before 1978 or may have
included improvements constructed before 1978. In any such case, those improvements are presumed
to contain or have contained LBP and ACM. The Developer hereby acknowledges that it has received
such information from the Agency, as in the possession of the Agency as of the date of this Notice,
regarding the potential of LBP and/or LBP hazards and ACM hazards on the Agency Lot.
No warranties, either express or implied, are given with regard to the condition of the Agency
Lot, including, without limitation, whether the Agency Lot does or does not contain LBP and/or ACM.
The information made available to the Developer by the Agency relating to LBP and ACM is believed
to be correct, but an error or omission, including but not limited to the omission of any information
available to the Agency shall not constitute grounds or reason for any claim by the Developer against
the Agency with respect to LBP and/or ACM which may be present on the Agency Lot. The failure of
the Developer to inspect the Agency Lot(s) for LBP and/or ACM, or to be fully informed as to the
condition of all or any portion of the Agency Lot, will not constitute grounds for any claim or demand
by the Developer against the Agency with respect to LBP and/or ACM.
The Agency assumes no liability for damages for personal injury, illness, disability, or deat\:! to
the Developer. or to any Consultant or employees, agents, or invitees of the Developer or any
Consultant. or to any other person, including members of the general public, arising from or incident to
the Agency Lot Investigation Work or other activity causing or leading to contact of any kind
whatsoever with ACM and/or LBP on the Agency Lot, whether the Agency has properly warned. or
failed to properly warn, any persons injured.
Section 4.
IReserved - No Textl
.Hi.w-~333-0W8.1
8
Section 5.
License to Enter Al!encv Lot.
(a) Subject to the terms and conditions of this PART TWO License, as of the date on which
the Executive Director of the Agency issues this Notice, the Agency hereby permits, authorizes and
licenses the Developer and its Consultants to enter the Property and perform each of the Property
Investigation Work items identified in Section 2(b) at reasonable times for thirty (30) days following
the date appearing next to the signature of the Executive Director of the Agency on page 3 of this
Notice, unless a shorter period of time is indicated below:
NO FURTHER ENTRY BY THE
PERMITTED AFTER 5:00 P.M. ON
this Notice: See Introduction]
DEVELOPER OR ANY CONSULTANT
,2005. [e.g.: 60 days afterthe date of
Unless a shorter period for authorized entry is indicated in the preceding sentence, or unless
this PART TWO License is terminated before such date, as provided in Section 5(b) or Section 5(c),
no further entry on the Agency Lot(s) by the Developer and/or its Consultants is permitted thirty (30)
days after the date appearing next to the signature of the Executive Director of the Agency on page 3
of this Notice.
(b) The license given to the Developer and its Consultants to enter the Agency Lot(s) and
perform the Property Investigation Work shall be subject to termination by the Agency for the
convenience of the Agency, upon ten (10) days written notice to the Developer.
(c) The license given to the Developer and its Consultants to enter the Agency Lot and
perform the Agency Lot Investigation Work shall be subject to termination by the Agency of in its sole
and absolute discretion for good cause upon twenty four (24) hours notice to the Developer. Promptly
following a termination under this Section 5(c), the Agency shall prepare a suitably detailed written
report setting forth the grounds that the Agency believes support such a termination of this PART
TWO License under this Section 5(c).
(d) If after the date of execution of this Notice by the Executive Director of the Agency, the
Developer desires to perform any item of Agency Lot Investigation Work that is not specifically set
forth in Section 2(b), the Developer shall request the Agency to approve each additional item of work
in writing, prior to the performance of such work on the Agency Lot, and such approval shall not be
unreasonably withheld, conditioned or delayed. The Agency may condition its approval of additional
work items on compliance by the Developer with any special conditions that may then be deemed
appropriate by the Agency.
Section 6.
Intrusive Testinl! and SamDlinl! Work on the Al!encv Lot.
(a) If one or more boxes are checked in Section 2(b)(3) through (5), or if the box checked
in Section 2(b)(6) relates to an investigation for underground storage tanks, underground or overhead
utility structures or other mechanical equipment or structural items on the Agency Lot, then prior to
entry onto the Agency Lot to perform such work, the Developer and its Consultant(s) shall submit the
appropriate H&S Plan to the Agency for its review not less than four (4) business days (excluding
weekends and holidays) before the time scheduled for commencement of such work on the Agency
Lot. The Agency shall promptly review such H&S Plan and approve or reject such H&S Plan, within
four (4)business days following receipt.
~~-W-2333-U048.1
9
(b) No Geotechnical Soils Investigation Work shall be performed on the Agency Lot that
requires the installation of shoring or other appliances to prevent collapse of trenching or test pits.
(c) No Agency Lot Investigation Work shall disturb any environmental facility on the
Agency Lot.
(d) For Phase II Environmental Investigation Work, ACM Investigation, LBP Investigation
and Other Investigation Work, as applicable, the Developer and each of its Consultants shall be
responsible for all of the following:
(l) each intrusive test or sampling of soils or structures and construction materials shall be
described in writing (and identify the location(s) and quantities of the sample(s) to be
taken) and shall identify the person responsible for conducting such tests or samples and
contain a suitable reference to the engineering or toxicological testing and analysis
standard to be applied, and such written description shall be delivered to the Agency at
least four (4) business days prior to the time of commencement of such proposed
sampling or testing;
(2) each intrusive test or sampling shall be conducted under the direction of the
Environmental Consultant and performed in a safe manner and in accordance with all
Environmental Laws;
(3) if required under applicable Environmental Laws, the Environmental Consultant shall
be responsible for collecting and temporarily storing (pending final disposal off-site, if
required, or release and recompaction on-site, if permitted) at an on-site location
designated by the Agency on the Agency Lot, all samples of soils, mud, water, building
test material, liquids or other waste materials produced during the course of the
performance of any such intrusive sampling or testing work conducted on the Agency
Lot;
(4) the Environmental Consultant shall be responsible for arranging for the off-site final
disposal all samples of soils, mud, water, building structural material, liquids or other
waste materials produced during the course of the performance of any such intrusive
sampling or testing that are either found to contain Hazardous Substances or that must
otherwise be transported off-site for final disposal under applicable Environmental
Laws upon the conclusion of the performance of the Phase II Environmental
Assessment Work:
(5) the Agency shall sign all waste disposal manifests and authorize the transport and
lawful disposal during the term of this PART TWO License of any such sampling
materials that are found to contain a Hazardous Substance or that must otherwise be
transported off-site for final disposal under applicable Environmental Laws;
(6) all such sampling and testing work shall be conducted in such a manner as to minimize
destruction to the Agency Lot sampled and to prevent any release to the environment of
a Hazardous Substance.
~8++.2333-O0481 10
(e) If the results of the testing or investigation of its Environmental Consultant indicates
that a Hazardous Substance is present on the Agency Lot, the Developer shall promptly notify the
Agency of such a finding. Upon request of the Agency, the Developer shall instruct its Consultant to
provide the Agency with the complete results of laboratory samplllg, testing protocols and chain-of-
custody information.
(f) Prior to entry onto the Agency Lot to perform any Agency Lot Investigation Work, the
Developer and each Consultant, as applicable, shall furnish, or shall cause to be furnished, to the
Agency duplicate originals or appropriate certificates of comprehensive general liability insurance in
the amount of One Million Dollars ($1,000,000.00) combined single limit, naming the Agency as an
additional insured. Such insurance shaU cover comprehensive general liability including, but not
limited to, contractual liability acts of subcontractors premises-operations explosion, collapse and
underground hazards and personal injury including libel, slander and false arrest. In addition, each
Consultant shall provide the Agency adequate proof of comprehensive automobile liability insurance
covering owned. non-owned and hired vehicles, combined single limit in the amount of One Million
Dollars ($1,000,000.00) per each occurrence and proof of workers' compensation insurance in
compliance with all applicable law. All insurance policies required hereunder shall be obtained from
insurance companies admitted in the State of California and rated at least "A (vii)" in Best's Insurance
Guide, current edition. All said insurance policies shall provide that they may not be canceled or
modified unless the Agency receives written notice of modification or cancellation at least thirty (30)
calendar days prior to the effective date of cancellation. Any and aU insurance obtained by the
Developer and each Consultant hereunder shall be primary to any and all insurance that the Agency
may otherwise carry, including self insurance, which for all purposes of this PART TWO License shall
be separate and apart from the requirements of this PART TWO License. Any insurance policies
governing the Agency Lot, as obtained by the Agency, shall not be transferred from the Agency to the
Developer.
Section 7.
Investi!!ation.
A!!encv Staff Mav Accompanv Consultant Durin!! A!!encv Lot
The agents or employees of the Agency may accompany the Developer and each of its
Consultants during any entry made by such persons onto the Agency Lot pursuant to this PART TWO
License (but are under no obligation to do so). Each Consultant shall provide the Agency with copies
of any testing or sampling results promptly upon request by the Agency. The Developer and each of
its Consultants shall give the Agency at least seventy-two (72) hours prior notice by telephone call
confirmed by FAX message transmitted to the address indicated in Section 9, below, of the time and
date of each proposed entry onto the Agency Lot.
Section 8.
Indemnity of the Developer in Favor of the A!!encv.
The Developer shall indemnify, defend and hold the Agency harmless from and against, any
and all costs. expenses (including, without limitation. attorneys' fees), damages, claims, liabilities.
liens. encumbrances and charges (herein "Claim Matters") arising out of. or in any way related to any
entry by the Developer or any of its Consultants onto the Agency Lot under this PART TWO License.
except as to such Claim Matters relating to events or occurrences (including the release or threatened
release of any Hazardous Substance) predating such entry by the Developer and/or any of its
Consultants or that otherwise arise from the sole and active negligence of the Agency.
.j8~-2333-0048.1
11
Section 9.
Notice to the Parties.
For the purpose of this PART TWO License, communications and notices among the parties
shall be directed as follows:
To the Agency:
Redevelopment Agency of the City of San Bernardino
20 I North "E" Street
San Bernardino, California 92401
Telephone: (909) 663-1044
Fax: (909) 888-9413
To the Developer:
Meadowbrook Park Homes, Inc.
Attn: George Jordan
Telephone:
Fax:
Additional emergency contact information for each Consultant is found in Exhibit "D".
Section 1 O. All Costs Associated With A2encv Lot Investi2ation Work Shall be Paid By
the Developer.
All costs incurred in connection with any Agency Lot Investigation Work, including without
limitation, any costs associated with the transport and disposal of any Hazardous Substance produced
during the course of such work, as provided under Section 6( d)( 4), shall be the sole responsibility of
and be paid by the Developer. If any claim or lien against the Agency Lot is recorded for materials
supplied or labor or professional services performed for the Developer, the Developer shall promptly
satisfy and discharge all such liens, at the sole cost and expense of the Developer.
Section 11. Copies of Reports Shall Be Provided to the A2encv.
The Developer shall provide the Agency with a copy of each report and, if applicable
construction/repair cost estimates it obtains from its Consultants relating to Agency Lot Investigation
Work performed on the Agency Lot under the License Agreement, within fourteen (14) days following
the conclusion of such Agency Lot Investigation Work.
Section 12.
List of Exhibits.
Each of the following exhibits described in this Section 12 is deemed to be part of this P ART
TWO License and is incorporated herein by this reference:
Exhibit "A" Description of the Agency Lot;
Exhibit "B" Copies of each Consultant services agreement by and between The Developer
and each Consultant identified in Section 2(b);
Exhibit "C" If the Executive Director of the Agency has included "Special Conditions" these
are set forth in Exhibit "C";
4844.2333'{)~8.1 12
Exhibit "D" Emergency Contact Listing for Each Consultant.
Section 13. Due Acceptance.
This Notice shall have no further force or effect unless the Developer has completed this PART
TWO and executed it at the place indicated below, and has returned its executed copy of PART TWO
(and the accompanying exhibits for the indicated Agency Lot Investigation Work) within thirty (30)
days following the date of this Notice.
DEVELOPER
Meadowbrook Park Homes, Inc.
Date:
By:
THIS PART TWO IS HEREBY ACCEPTED BY THE AGENCY:
Redevelopment of Agency of the City of San
Bernardino
Date:
By:
Executive Director
..:;.w-:;]33-DO..8.1
13
-- PART THREE --
This PART THREE evidences the Developer's acceptance of the condition of the Agency Lot
as set forth under the Agreemcn:
The Developer hereby acknowledges and !lgrees that it has completed its Due Diligence
Investigation for the Agency Lot.
The Developer hereby accepts the condition of the Agency Lot and the signature of the
Developer as appears below in this PART THREE shall conclusively evidence the Developer's
acceptance of the condition of the Agency Lot as provided in Section 2.05(i) of the Agreement.
DEVELOPER
Meadowbrook Park Homes, Inc.
Date:
By:
4K-l-l-:333'{)048. i
14
EXHIBIT "C'
RESERVED - NO EXHrnn
4:-\5:-: 2()5-25-W:i
1':: ::!S 0..1
51
EXHIBIT "D"
RESERVED - NO EXHIBIT
4853-1265-25.+45
12 2804
52
EXHIBIT "E"
FORM OF AGENCY GRANT DEED
(i) FOR TYPE A AGENCY LOT
(ii) FOR TYPE B AGENCY LOT
(iii) FOR TYPE C AGENCY LOT
~853-1 ~b5':~5U.5
) ~ ~s 0-.4
53
RECORDING REQUESTED BY )
Redevelopment Agency of the )
City of San Bernardino )
)
AND WHEN RECORDED MAIL )
PROPERTY TAX BILL TO: )
)
Meadowbrook Park Homes, Inc. )
10702 Hathaway Drive, Suite No.1)
Santa Fe Springs, California 90670 )
Attn: George Jordan )
)
(Space above line reserved for use by Recorder)
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
GRANT DEED OF A PUBLIC AGENCY
AND
COMMUNITY REDEVELOPMENT
AFFORDABLE SINGLE FAMILY RESIDENTIAL HOUSING
DEVELOPMENT, USE AND OCCUPANCY CONDITIONS,
COVENANT AND RESTRICTIONS
(TYPE A AGENCY LOT)
PART A
THIS GRANT DEED OF A PUBLIC AGENCY AND COMMUNITY REDEVELOPMENT
AFFORDABLE SINGLE FAMILY RESIDENTIAL HOUSING DEVELOPMENT, USE AND
OCCUPANCY CONDITIONS, COVENANTS AND RESTRICTIONS (the "Grant Deed") transfers
all of the right, title and interest of the Redevelopment Agency of the City of San Bernardino, a
public body corporate and politic (the "Agency") in certain real property situated at
San Bernardino. California (the "Property") to Meadowbrook Park Homes. Inc.. a California
corporation. (the "Developer"), subject to the community redevelopment affordable single family
housing conditions, covenants and restrictions contained in PART B hereof. The Agency is the
grantor in this Grant Deed, and the Developer is the grantee.
For valuable consideration, the receipt of which is hereby acknowledged, the Agency hereby grants
to the Developer, subject to the community redevelopment affordable single family housing
conditions, covenants and restrictions of this Grant Deed, all of the right, title and interest of the
Agency in the Property, as more particularly described below:
.\R50-5445-094.\ 1
1
(-- The Property--)
, on file in the Official Records of the Office of the
Recorder of San Bernardino County.
PART B
The grant by the Agency of the Property to the Developer is expressly subject to the satisfaction of
the following community redevelopment affordable single family housing conditions, covenants and
restrictions as arise under that certain 2004 Meadowbrook Single Family Residential Development
Agreement. dated as of December 20.2004, (the "Agreement") by and between the Agency and the
Developer:
1. the Property shall be reserved for use, improvement and occupancy for single family
residential purposes for a term of fifty (50) years commencing on the date of
recordation of this Grant Deed; and
2. the Property shall be used, reserved, sold, transferred, granted, conveyed or otherwise
hypothecated for occupancy only to a person or a family who is a "Qualified
Homebuyer" for a "Type A Agency Lot", as these terms are defined in the
Agreement, for a term of forty five (45) years, beginning on the date of recordation of
the Single Family Housing Affordability Covenant described in subparagraph 3,
below. The words "Qualified Homebuyer" as this term is defined in the Agreement.
and is used in this Grant Deed refer to any person or family who owns and occupies
(or who declares their intention to own and occupy) the Property as their principal
residence, and whose adjusted gross income during the twelve (12) months preceding
the date of initial occupancy of the Property by the Qualified Homebuyer does not
exceed the household income qualification limits for such Qualified Homebuyer. as
referenced in the Agreement.
3. As a condition precedent to any transfer. sale, conveyance. grant or other
hypothecation by the Developer of the Property to a Qualified Homebuyer, the
"Single Family Housing Affordability Covenant" (the "Single Family Housing
Affordability Covenant"). substantially in the form as on file with the Agency
Secretary, shall be fully executed by the parties in recordable form by the Developer.
the Qualified Homebuyer and the Agency and filed for recordation affecting the
Property as an official record of the Recorder of San Bernardino County. all as set
forth in the Agreement. The final form of the Single Family Housing Affordability
Covenant shall be consistent with the terms and conditions of the Agreement as
applicable at the time of initial occupancy of the Property by a Qualified Homebuyer.
4. The Property shall be subject to the following affordable housing redevelopment
covenant in perpetuity and the text which appears in this Grant Deed shall be
incorporated into the text of each grant deed or other instrument which transfers the
..850-5445-09441
2
Property to a successor In interest of the Developer, and to each Qualified
Homebuyer:
"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, age, handicap, national
origin or ancestry in the sale, transfer, use, occupancy, tenure or
enjoyment of the land herein conveyed, nor shall the grantee himself
or herself or any person claiming under or through him or her, estab-
lish or permit any such practice or practices of discrimination or
segregation with reference to the selection, location. number, use or
occupancy of any vendee in the land herein conveyed. The foregoing
covenants shall run with the land."
PARTe
During the term of subparagraph 2 of PART B, but prior to the recordation of a Single Family
Housing Affordability Covenant, executed by the Agency, the Qualified Homebuyer and the
Developer, the Agency hereby authorizes the Developer to conduct land improvement and home
sales and ancillary business activity on the Property associated with the improvement and sale of the
Property by the Developer, of an affordable single family dwelling unit on the Property to a
Qualified Homebuyer, pursuant to the Agreement. The provisions of PART C of this Grant Deed
shall have no further force or effect upon the Property after the date of the recordation of the Single
Family Housing Affordability Covenant.
PART D
The provisions of this Grant Deed are expressly declared by the Agency to promote an increase,
improvement and preservation of the community's supply of low- and moderate-income housing.
The transfer of the Property by the Agency to the Developer for this purpose, and the recordation of
this Grant Deed, an authorized by Health and Safety Code Sections 33334.2 and 33334.3, and other
applicable law and actions of the Agency.
PART E
Upon the delivery of this Grant Deed to the Developer, the community redevelopment affordable
housing conditions, covenants and restrictions as contained herein shall be covenants and restrictions
which affect the Property and shall run with the land and shall be enforceable by either the Agency or
by the City of San Bernardino, a municipal corporation, as provided by Health and Safety Code
Section 33334.3(f)(2) against the Developer and each successor in interest or assignee of the
Participant in the Property, including, without limitation, any Qualified Homebuyer. No person other
than either the City of San Bernardino or the Agency shall be deemed to be authorized to enforce any
provision of this Grant Deed as a covenant or restriction which runs with the land and affects the
Property.
J850-5445-0944 1
3
THIS GRANT DEED is executed as of the date indicated below next to the authorized signatures of
the Executive Director of the Agency.
AGENCY
Redevelopment Agency of the City of
San Bernardino, a public body corporate and politic
Dated:
By:
Executive Director
~X51)-5445-09~~ I
4
ACCEPT ANCE OF GRANT DEED AND COMMUNITY REDEVELOPMENT
AFFORDABLE SINGLE FAMILY RESIDENTIAL HOUSING DEVELOPMENT,
USE AND OCCUPANCY CONDITIONS, COVENANTS AND RESTRICTIONS
BY THE DEVELOPER
Meadowbrook Park Homes, Inc., a California corporation and the grantee of the within
instrument (the "Participant'"). hereby accepts the delivery of the instrument identified above as the
"Grant Deed of a Public Agency and Community Redevelopment Affordable Single Family
Residential Housing Development, Use and Occupancy Conditions, Covenants and Restrictions"
(the "Grant Deed"), and the transfer of the Property from the Redevelopment Agency of the City of
San Bernardino, subject to the conditions, covenants and restrictions contained in the Grant Deed.
The Developer hereby acknowledges and agrees that it accepts the Property in an "AS-IS",
"WHERE IS" and "SUBJECT TO ALL F AUL TS" condition and that the Developer is solely
responsible for causing the Property to be improved and rehabilitated and reserved for sale and
occupancy by a Qualified Homebuyer as set forth in the Agreement by and between the Agency and
Developer.
The Developer hereby further accepts and agrees to each of the community redevelopment
affordable housing use, improvement and occupancy conditions, covenants and restrictions contained
in the Grant Deed which touch and concern the Property and are community redevelopment
covenants which run with the land.
DEVELOPER
Meadowbrook Park Homes, Inc., a California corporation
Dat~d:
By
Its:
By:
Its:
[NOTARY JURAT ATTACHED]
~X~O-5.l45-09441
5
EXHIBIT -T'
RESERVED - NO EXHIBIT
L305
54
EXHIBIT "G"
SCHEDULE OF PERFORMANCE
.J.8):.-1265-2S-W.5
12 28 04
55
EXHIBIT "W
FORM OF SECTION 33334.3 COVENANT
~X~:- j 265-25~.5
56
l22K(J4
UCORDING UQUESTED BY
AND WHEN RECORDED MAIL TO:
Redevelopment Agency of the City of San Bernardino
201 North "E" Street, Suite 301
San Bernardino, CA 92401
Attn: Executive Director
(Space Above Line Reserved For Use By Recorder)
RECORDATION OF THIS
INSTRUMENT IS EXEMPT FROM ALL
FEES AND TAXES
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
COMMUNITY REDEVELOPMENT HOUSING
AFFORDABILITY COVENANTS AND USTRICTIONS
Dated as of
, 200
Meadowbrook Single Family
Residential Grant Development Agreement
QJ.02~) ANR-Mo-lu.t>.ool: ~",........
REDEVELOPMENT AGENCY OF '!'HE CI:TY OF SAN BERNARDI:NO
COMMUNI:TY REDEVELOPMENT BOOSI:NG
AFFORDABI:LI:TY COVENANTS AND RESTlUCTI:ONS
(Meadowbrook Single Family Grant Development Agreement)
THIS REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
COMMUNITY REDEVELOPMENT HOUSING AFFORDABILITY COVENANTS AND
RESTRICTIONS (the "Section 33334.3 Covenant") is made and
entered into as of , 200 _, by and among ANR
Industries, Inc., a California corporation (the Developer"), the
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO, a body
corporate and politic (the "Agency"), and
(the "Qualified
Homebuyer"), and this Section 33334.3 Covenant relates to the
following facts set forth in Recitals.
R E C I TAL S
A. The Qualified Homebuyer proposes to acquire a single
family residence (the "New Home"), located within the City of
San Bernardino (the "City"), from the Developer, to be owned and
occupied by the Qualified Homebuyer as their principal
residence. The legal description of the New Home is attached
hereto as Exhibit "A" and incorporated herein by this reference.
B. The Agency has used and applied certain affordable
housing development funds from the Low-and Moderate-Income
Housing Funds of several different redevelopment proj ect areas,
to make the New Home available for acquisition by the Qualified
Homebuyer from the Developer subject to the terms and conditions
of the Community Redevelopment Law found at Health and Safety
Code-Section 33000, et seq. (the "Act") and this Section 33334.3
Covenant; and
C. The Act mandates that the acquisition, use and
occupancy of the New Home shall be regulated in certain respects
for the term as provided herein (the "Qualified Residence
Period") in order to ensure that the New Home will be used and
occupied in accordance with the Act and the affordable single
family residential dwelling unit development goals and
objectives of the Agency.
0341.Q3 ANR__wbn>ok ~ ^-
NOW, THEREFORE, IN CONSXDERATXON OF THE MOTOAL COVENANTS
AND UNDERTAKINGS SET FORTH HEREIN, AND FOR OTHER GOOD AND
VALUABLE CONSIDERATION, THE RECEIPT AND SUFFICIENCY OF WHICH IS
HEREBY ACKNOWLEDGED, THE QUALIFIED BOMEBOYER, THE DEVELOPER AND
THE AGENCY DO HEREBY COVENANT AND AGREE FOR THEMSELVES, THEIR
SUCCESSORS AND ASSIGNS AS FOLLOWS:
Section 1. Definitions of Certain Terms. As used in this
Section 33334.3 Covenant, the following words and terms shall
have the meaning as provided in the Recitals or in this Section
1 unless the specific context of usage of a particular word or
term may otherwise require:
Adjusted Fami1y Income. The words ~Adjusted Family Income"
mean the anticipated total annual income (adjusted for
family size) of each individual.or family residing or
treated as residing in the New Home as calculated in
accordance with Treasury Regulation 1.167(k) - 3b) (3) under
the Code, as adjusted, based upon family size in accordance
with the household income adjustment factors adjusted and
amended from time to time, pursuant to Section 8 of the
United States Housing Act of 1937, as amended.
Affordab1e Housing Cost. The words ~Affordable Housing
Cost" shall have the meaning as set forth in Health and
Safety Code Section 50052.5, as this section may hereafter
be amended from time-to-time by the State of California. A
Qualified Homebuyer and/or the Successor-In-Interest of
such Qualified Homebuyer, if any, shall pay no more than an
Affordable Housing Cost for the New Home as of the
applicable Delivery Date.
Agency Investment Reimbursement. The words ~Agency
Investment Reimbursement" mean and refer to the sum of
money which may be payable to the Agency by the Qualified
Homebuyer if, during the Qualified Residence Period, the
Qualified Homebuyer sells, assigns, transfer or otherwise
hypothecates the New Home to any person who does not
satisfy the requirement of a permitted successor-in-
interest (in other words the Successor-In-Interest
designated by the Qualified Homebuyer is a person or
household whose Adjusted Family Income exceeds the income
level for a Moderate Income Household). The Agency
Investment Reimbursement, and the method or formula for
determining the amount, if any, as may be payable by the
Qualified Homebuyer to the Agency upon the resale of the
New Home, is more particularly described in Section 5 of
OJ.02.o)ANR___~Acr=-
this Section 33334.3 Covenant. As of the Delivery Date,
the Agency has provided the Developer with the sum of
$50,000 as an affordable housing development assistance
contribution for the improvement of the New Home, and the
provisions of Section 5 of this Section 33334.3 Covenant
are included in satisfaction of the requirements of Health
and Safety Code Section 33334.3(f) (B).
Code. The word "Code" means the Internal Revenue Code of
1986, as amended, and any regulation, rulings or procedures
with respect thereto.
Delivery Date. The words "Delivery Date" mean the date of
delivery of title and possession of the New Home from the
Developer to the Qualified Homebuyer at the close of the
New Home Escrow. In the case of a Successor-In-Interest,
the words "Delivery Date" refers to the date on which such
Successor-In-Interest acquires the New Home from the
Qualified Homebuyer; provided however, that for the purpose
of establishing the termination date of the Qualified
Residence Period, the Delivery Date shall refer to the date
on which this Section 33334.3 Covenant is recorded.
Moderate-Income Household. The words "Moderate-Income
Household" mean persons and families whose income does not
exceed one hundred and twenty percent (120%) of the area
median income of the City adjusted for family size by the
State Department of Housing and Community Development 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, as amended, and Health and
Safety Code Section 50093, as this section may hereafter be
amended from time-to-time by the State of California.
New Home. The words "New Home" mean and refer to the
completed affordable single-family residential dwelling
unit (including the land and' landscape improvements
thereon) as constructed and installed by the Developer and
sold to the Qualified Homebuyer.
New Home Escrow. The words "New Home Escrow" mean and
refer to the real estate conveyance transaction or escrow
by and between the Developer and the Qualified Homebuyer
(or later, by and between the Qualified Homebuyer and the
Successor-In-Interest). The transfer of the New Home from
the Developer to the Qualified Homebuyer (or later, by and
~.oJANIlI"""_~_
between the Qualified Homebuyer and the Successor-In-
Interest) shall be accomplished upon the close of the New
Home Escrow.
Notice of Agency Concurrence. The words "Notice of Agency
Concurrence" mean and refer to the acknowledgment in
recordable form in which the Agency confirms that the
proposed Successor-In-Interest of the Qualified Homebuyer
satisfies all of the Adjusted Family Income and other
requirements of this Section 33334.3 Covenant for occupancy
of the New Home by the Successor-In-Interest at any time
during the Qualified Residence Period.
Qualified Homebuyer. The words "Qualified Homebuyer" mean
the purchaser of the New Home from the Developer (e. g. :
all persons identified as having a property ownership
interest vested in the New Home as of the close of the New
Home Escrow). At the close of the New Home Escrow, the
Qualified Homebuyer shall: (i) have an annual Adjusted
Family Income which does not exceed the household income
qualification limits of a Moderate-Income Household: (ii)
shall be a first-time homebuyer, as this term is defined in
Health and Safety Code Section 50068.5 as this section may
hereafter be amended from time-to-time by the State of
California; and (iii)pay no more than an Affordable Housing
Cost for the New Home pursuant to the terms of the purchase
transaction for the New Home, including all sums payable
by the Qualified Homebuyer for its purchase money mortgage
financing, insurance, escrow and other fees and costs.
Qualified Residence Period.
Period" mean the period of
Date and ending on the date
after the Delivery Date.
The words "Qualified Residence
time beginning on the Deli very
which is forty-five (45) years
Section 33334.3 Covenant. The words "Section 33334.3
Covenant" mean these Redevelopment Agency of the City of
San Bernardino Community Redevelopment Housing
Affordability Covenants and Restrictions by and among the
Qualified Homebuyer, the Developer and the Agency
pertaining to the New Home.
Successor-In-Interest. The words "Successor-In-Interest"
mean and refer to the person, family or household which may
acquire the New Horne from the Qualified Homebuyer at any
time during the Qualified Residence Period by purchase,
assignment, transfer or otherwise and whose payments for
0:1-02-4) ANR-M.Adu<<boook ~ ~
the acquisition of the New Home from the Qualified
Homebuyer do not exceed an amount which is an Affordable
Housing Cost for suchSuccessor-In-Interest household. The
Successor-In~Interest does not need to be a "First-Time
Homebuyer" but, such Successor-In-Interest shall have an
income level for the twelve (12) months prior to the date
on which the Successor-In-Interest acquires the New Home
which does not exceed the maximum Adjusted Family Income
level for a Moderate-Income Household. Upon acquisition
of the New Home the Successor-In-Interest shall be bound by
each of the covenants, conditions and restrictions of this
Section 33334.3 Covenant.
The titles and headings of the sections of this Section
33334.3 Covenant have been inserted for convenience of reference
only and are not to be considered a part hereof and shall not in
any way modify or restrict the meaning any of the terms or
provisions hereof.
Section 2. Acknowledgments and Representations
Qualified Bomebuyer. The Qualified Homebuyer
acknowledges and represents to the Agency that, as
Delivery Date:
of the
hereby
of the
(a) the total household income for the Qualified Homebuyer
does not exceed the maximum amount permitted as Adjusted Family
Income for a Moderate-Income Household, adjusted for family
size;
(b) the Qualified Homebuyer intends to promptly occupy the
New Home after the Delivery Date as the principal place of
residence for a term of at least two (2) years following the
Deli very Date and the Qualified Homebuyer has not entered into
any arrangement and has no present intention to rent, sell,
transfer or assign the New Home to any third party during the
Qualified Residence Period so as to frustrate the purpose of
this Section 33334.3 Covenant;
(c) the Qualified Homebuyer has no present intention to
lease or rent any room or sublet or rent a portion of the New
Home to any relative of the Qualified Homebuyer or to any third
person at any time during the Qualified Residence Period;
(d)
following
interest,
the sum payable each month by the Qualified Homebuyer
the close of the New Home Escrow as principal and
property taxes and, property casualty insurance for
~ANIlII.....~....A~~
the acquisition of the New Home does not exceed the Affordable
Housing Cost for the household;
(e) the Qualified Homebuyer agrees to provide the Agency
with the following items of information for inspection by the
Agency promptly upon written request of the Agency:
(i) State and federal income tax returns filed by
all persons who reside in the New Home for the
most three (3) recent tax years preceding the
close of the New Home Escrow for inspection of
such State and federal income tax returns;
(ii)
current wage, income
all person residing
close of the New Home
and salary statements
in the New Home at
Escrow;
for
the
(f) The Qualified Homebuyer has been informed by the
Developer that this Section 33334.3 Covenant imposes certain
restrictions on the use and occupancy of the New Home during the
term of this Section 33334.3 Covenant and that this Section
33334.3 Covenant imposes certain restrictions on the resale of
the New Home during the Qualified Residence Period. The
Qualified Homebuyer acknowledges and understands that these
restrictions shall be applicable to the New Home and to any
resale of the New Home from the Delivery Date to the end of the
forty-five (45) year Qualified Residence Period which is
, 204 .
(g) Each of the foregoing acknowledgements and
representations of the Qualified Homebuyer are true and correct.
Dated:
Initials of
Qualified Homebuyer
Section 3. Covenant of the Qualified Homebuyer to Maintain
Affordabili ty of the New Home Durinq the Qualified Residence
Period and Covenant Relatinq to Sale or Transfer of the New Home
Durinq the Qualified Residence Period to a Successor-In-
Interest.
(a) The Qualified Homebuyer for itself, its heirs,
successors and assigns, hereby covenants and agrees that during
the term of the Qualified Residence Period the New Home shall be
used and, occupied by the Qualified Homebuyer as its principal
residence, and that the New Home shall be reserved for sale, use
OJ-<J2~) ANR 11..A..b._~~
and occupancy by the Qualified Homebuyer and/or for another
Moderate-Income Household as a Successor-In-Interest at an
Affordable Housing Cost. The Qualified Homebuyer, for itself,
its heirs, successors and assigns, further covenants and agrees
that, during the Qualified Residence Period, the Agency shall
have the right and duty as provided in this Section 3 to verify
that each proposed Successor-In-Interest of the Qualified
Homebuyer in the New Horne satisfies the income requirements and
Affordable Housing Cost limitations of a Moderate-Income
Household (based upon the Adjusted Family Income of each
household), and that the completion of any resale or transfer of
the New Horne to a Successor-In-Interest shall be subject to the
recordation of the "Notice of Agency Concurrence" as provided in
Section 3 (d) .
(b) The Qualified Homebuyer, for itself, its successors
and assigns, hereby covenants and agrees that during the term of
the Qualified Residence Period the Qualified Homebuyer shall not
sell, transfer or otherwise dispose of the New Horne (or any
interest therein) to a Successor-In-Interest without first
giving written notice to the Agency and without first obtaining
the written concurrence of the Agency as provided herein. At
least forty-five (45) days prior to the date on which the
Qualified Homebuyer proposes to transfer title in the New Horne
to a Successor-In-Interest, the Qualified Homebuyer shall send a
written notice to the Agency as provided in Section 17 of the
intention of the Qualified Homebuyer to sell the New Horne to a
Successor-In-Interest which includes the following true and
correct information:
(i) name of the proposed Successor-In-Interest
(including the identity of all persons in the
household of the Successor-In-Interest, proposing
to reside in the New Horne);
(ii) copies of State and federal income tax returns
for the Successor-In-Interest for the calendar
year preceding the year in which the notice of
intention to sell the New Horne is given to the
Agency;
(iii) resale price of the New Horne payable by the
Successor-In-Interest, including the terms of all
purchase money mortgage financing to be ass~ed,
provided. or obtained by the Successor-In-
Interest, escrow costs and charges, realtor
broker fees and all other resale costs or charges
O~~3ANRMoodD_~~
payable by either the Qualified Homebuyer or the
Successor-In-Interest;
(iv) name address, and telephone number of the escrow
company which shall coordinate the transfer of
the New Home from the Qualified Homebuyer to the
Successor-In-Interest;
(v) appropriate mortgage credit references for the
Successor-In-Interest together with a written
authorization signed by the Successor-In-Interest
authorizing the Agency to contact each such
reference (for the purposes of this subparagraph
(v), appropriate mortgage credit reference may
include a true and correct and complete copy of
the mortgage loan application submitted by the
Successor-In-Interest to its proposed purchase
money mortgage lender); and
(vi) such other relevant information as the Agency may
reasonably request, as provided in Section 3(c).
(c) Within twenty (20) days following receipt of the
notice of intention and accompanying written information
described in Section 3(b), the Agency shall provide the
Qualified Homebuyer with either a preliminary confirmation of
approval or a preliminary rej ection of approval in writing of
the income and household occupancy qualifications of the
Successor-In-Interest. The Agency shall not unreasonably
withhold, condition or delay approval or rejection of the
qualifications of the proposed Successor-In-Interest in
connection with any proposed sale of the New Home. In the
event that the Agency may request additional information
relating to the confirmation of the matters described in Section
3(b) with respect to a proposed Successor-In-Interest, the
Qualified Homebuyer shall provide such information to the Agency
as promptly as feasible.
(d) Upon its final confirmation of approval of the
Adjusted Family Income and Affordable Housing Cost eligibility
of the Successor-In-Interest to acquire the New Home, the Agency
shall deliver a written acknowledgment and approval of the
resale of the New Home to the Successor-In-Interest (e.g., the
Notice of Agency Concurrence) in recordable form to the escrow
holder referenced in Section 3(b) (iv) above, and thereafter the
Successor- In- Interest may acquire the New Home subj ect to the
satisfaction of the following conditions:
OJ.41-4lANll__~_
\
(i) the income and household occupancy information
provided to the Agency shall be true and
correct, and the Notice of Agency Concurrence
executed by the Successor- In- Interest and the
Agency shall be recorded at the close of the
resale escrow;
(ii) the escrow holder shall have provided the
Agency with a copy of the customary form of the
final escrow closing statement of the Qualified
Homebuyer and the final escrow closing
statement for the Successor-In-Interest; and
(iii) the other conditions of the resale escrow
established by the Qualified Homebuyer
Successor-In-Interest shall have
satisfied.
as
and
been
(e) The Qualified Homebuyer for itself, its successors and
assigns hereby covenants and agrees that during the Qualified
Residence Period the New Home shall not be leased, subleased, or
rented to any third person, except for a temporary period (not
to exceed 12 months) in the event of an emergency or other
unforeseen circumstance as may be expressly approved in writing
by the Agency subject to compliance during the temporary rental
period with the reasonable temporary rental occupancy conditions
required by the Agency. The Qualified Homebuyer shall submit a
written request to the Agency prior to the commencement of the
temporary occupancy, as practicable, but in any event within not
more than (60) days following the commencement of a temporary
rental occupancy of the New Home by a third party, which notice
to the Agency shall set forth the grounds on which the Qualified
Homebuyer believes an emergency or other unforeseen circumstance
has occurred and that a temporary rental occupancy in necessary.
Section 4. Maintenance Condition of the New Home. The
Qualified Homebuyer, for itself, its successors and assigns,
hereby covenants and agrees that:
(a) The exterior areas of the New Home which are subject
to public view (e.g.: all improvements, paving, walkways,
landscaping, and ornamentation) shall be maintained 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 the Qualified Residence Period, there is an occurrence
of an adverse condition on any area of the New Home which is
f1).42.Q3ANR_""'ook~_
subject to public view in contravention of the general
maintenance standard described above, (a "Maintenance
Deficiency") then the Agency shall notify the Qualified
Homebuyer in writing of the Maintenance Deficiency and give the
Qualified Homebuyer thirty (30) days from the date of such
notice to cure the Maintenance Deficiency as identified in the
notice. The words "Maintenance Deficiency" include without
limitation the following inadequate or non-confirming property
maintenance conditions and/or breaches of single family dwelling
residential property use restrictions:
failure to properly maintain the windows, structural
elements, and painted exterior surface areas of the
dwelling unit in a clean and presentable manner;
failure to keep the front and side yard areas of the
property free of accumulated debris, appliances,
inoperable motor vehicles or motor vehicle parts, or
free of storage of lumber, building materials or
equipment not regularly in use on the property;
failure to regularly mow lawn areas or permit grasses
planted in lawn areas to exceed six inches (6") in
height, or failure to otherwise maintain the
landscaping in a reasonable condition free of weeds
and debris;
parking of any commercial motor vehicle in excess of
7,000 pounds gross weight anywhere on the property, or
the parking of motor vehicles, boats, camper shells,
trailers, recreational vehicles and the like in any
side yard or on any other parts of the property which
are not covered by a paved and impermeable surface;
the use of the garage area of the dwelling unit for
purposes other than the parking of motor vehicles and
the storage of personal possessions and mechanical
equipment of persons residing in the New Home.
In the event the Qualified Homebuyer fails to cure or
commence and to diligently proceed to complete the cure of the
Maintenance Deficiency within thirty (30) days from the date of
notice to cure, the Agency may thereafter conduct a public
hearing following transmittal of written notice thereof to the
Qualified Homebuyer ten (10) days prior to the scheduled date of
such public hearing in order to verify whether a Maintenance
Deficiency exists and whether the Qualified Homebuyer has failed
03-02-03 ANR-Meodo_~_
to comply with the provision of this Section 4(a). If, upon the
conclusion of a public hearing, the Agency makes a written
finding that a Maintenance Deficiency exists and that there
appears to be non-compliance with the general maintenance
standard, as described above, and that the Qualified Homebuyer
has failed to cure such Maintenance Deficiency, then in such
event the Agency shall have the right (in addition to any other
rights or powers then available to the Agency or the City of San
Bernardino) to enter the New Horne (exterior areas only) upon ten
(10) days written notice to the Qualified Homebuyer and perform
all acts necessary to cure the Maintenance Deficiency, or the
Agency may take other action at law or equity the Agency may
then deem appropriate 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 4(a) shall become a lien on the New Horne. If the amount
of the lien is not paid within thirty (30) days after written
demand for payment by the Agency to the Qualified Homebuyer, the
Agency shall have the right to enforce the lien in the manner as
provided in Section 4(c).
(b) Graffiti which is visible from any public right-of-way
which is adjacent or contiguous to the New Horne shall be removed
by the Qualified Homebuyer from any exterior surface of a
structure or improvement on the New Horne by either 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
graffiti may be removed with solvents, detergents or water as
appropriate. In the event that graffiti is placed on the New
Horne (exterior areas only) and such graffiti is visible from an
adjacent or contiguous public right-of-way and thereafter such
graffiti is not removed within 72 hours following the time of
its application; then in such event and without notice to the
Qualified Homebuyer, the Agency shall have the right to enter
the New Horne and remove the graffiti. Notwithstanding any
provision of Section 4(a) to the contrary, any sum expended by
the Agency for the removal of graffiti from the New Horne as
authorized by this Section 4 (b) shall become a lien on the New
Horne. If the amount of the lien is not paid within thirty (30)
days after written demand for payment by the Agency to the
Qualified Homebuyer, the Agency shall have the right to enforce
its lien in the manner as provided in Section 4(c).
(c) The parties hereto further mutually understand and
agree that the rights conferred upon the Agency under this
Section 4 expressly include the power to establish and enforce a
lien or other encumbrance against the New Horne in the manner
O~-OJANR-Mcodo_~~
provided under Civil Code Sections 2924, 2924b and 2924c in the
amount as reasonably necessary to restore the New Horne to the
maintenance standard required under Section 4(a) or Section
4 (b), including the 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. In any
legal proceeding for enforcing such a lien against the New Horne,
the prevailing party shall be entitled to recover its attorneys'
fees and costs of suit. For the purposes of this Section 4, the
words "reasonable attorneys' fees and costs of the Agency" mean
and include the salaries and benefits payable to lawyers
employed by the Office of the City Attorney, allocated on an
hourly basis, who provide legal services to the Agency in
connection with the enforcement of this Section. The provisions
of this Section 4, shall be a covenant running with the land for
the Qualified Residence Period and shall be enforceable by the
Agency in its discretion, cumulative with any other rights or
powers granted by the Agency under applicable law. Nothing in
the foregoing provisions of this Section 4 shall be deemed to
preclude the Qualified Homebuyer from making any alterations,
additions, or other changes to any structure or improvement or
landscaping on the New Home, provided that such changes comply
with the zoning and development regulations of the City and
other applicable law.
Section 5. Protection of Aqency
Derived From the Low-and Moderate-Income
Home - Aqency Investment Reimbursement.
Investment of Moneys
Housing Fund in the New
(a) For the purpose of this Section 5, the following terms
shall have the meaning as provided below:
"Purchase Money Mortgage" means the original balance on the
Delivery Date of the New Horne mortgage provided to the Qualified
Homebuyer by the conventional mortgage lender, plus the original
outstanding balance of the Agency MAP Loan, if any.
"Qual.ified Homebuyer Equity" means the downpayrnent amount in
cash paid by the Qualified Homebuyer for the New Home on the
Delivery Date (e.g.: the equity or "basis" as defined under the
Code, net of the Purchase Money Mortgage of the Qualified
Homebuyer in the New Horne), plus the reduction, if any, of the
outstanding principal balance of the Purchase Money Mortgage
secured by the New Horne through the date of the resale of the
New Home.
O~-OJANIl_~""-
"Resa1e Price" means the total consideration paid by the
Successor-In-Interest, including real estate broker fees and
commissions for the purchase of the New Home, but excluding
escrow fees and mortgage financing costs payable or otherwise
allocated to the Successor-In-Interest in connection with the
transfer of the New Home from the Qualified Hornebuyer to the
Successor-In-Interest.
"Resale Profit" means the balance of the following calculation:
(Resale
Homebuyer
Profit.
Price)-(Purchase Money Mortgage)-(Qualified
Equity + Resale Cost Adjustment Factor)=Resale
A portion of the Resale Profit shall be payable to the Agency by
the Qualified Homebuyer in accordance with Section 5(b).
"Resale Cost Adjustment Factor" means one of the following sums
determined by reference to the number of years which have
elapsed between the Deli very Date and the date on which the
resale and transfer of the New Home to the Successor-In-Interest
occurs:
Date of Resale of New Home
after the Delivery Date:
From the Delivery Date to the
5th anniversary after Delivery
Date
From and including the 5th
anniversary to the 10~
anniversary after Delivery
Date
From and including
anniversary to
anniversary after
Date
the 10th
the 30th
Delivery
From and including the
anniversary to the end of
Qualified Residence Period
30th
the
Resale
Factor:
Adjustment
Cost
$0
$5,000.00
$10,000.00
$15,000.00
(b) The Agency has used and applied certain moneys from
the Low-and Moderate-Income Housing Funds of the Agency to
~-43 ANR-..b.ool< ~........-
assist with the development of the New Home. In the event that
the New Home may be sold, assigned, conveyed or otherwise
transferred by the Qualified Homebuyer during the term of the
Qualified Residence Period to a person or household whose
Adjusted Family Income exceeds the income level for a Moderate-
Income Household, a portion of the Resale Price of the New Home
in excess of an adjusted sale price amount which the Qualified
Homebuyer paid on such resale date (e.g.: the "Resale Profit"
amount) shall be payable to the Agency as the Agency Investment
Reimbursement in accordance with Health and Safety Code Section
33334.3(f), and as provided herein. In the event that, at any
time during the Qualified Residence Period, the Qualified
Homebuyer (or any Successor-In-Interest) may sell, assign,
conveyor otherwise transfer the New Home to a person or
household whose Adjusted Family Income exceeds the income level
for a Moderate-Income Household, a portion of the Resale Profit
realized by the Qualified Homebuyer shall be payable to the
Agency as the "Agency Investment Reimbursement" in the amounts
as follows:
Date of Resale of New Home
After Deli very Date
From the Deli very
2~ anniversary
Delivery Date
Date to the
after the
From the 2nd anni versary to
the 10th anniversary after the
Delivery Date
From the 10th anniversary to
end the 20~ anniversary after
the Delivery Date
From the 20th anniversary to
the 30th anniversary after the
Delivery Date
From the 30~ anniversary
after the Delivery Date to
the end of the Qualified
Residence Period
03-02-03 Nm-Headowbroot Developaent Aqreeaent
Portion of Resale Profit
Payable to Agency from Resale
of New Home
100% of Resale Profit is
payable to Agency as Agency
Investment Reimbursement
75% of Resale Profit is
payable to Agency as Agency
Investment Reimbursement
50% of Resale Profit is
payable to Agency as Agency
Investment Reimbursement
Resale Profit is
the Agency as
Investment
25% of the
payable to
Agency
Reimbursement
Resale Profit is
the Agency as
Investment
10% of the
payable to
Agency
Reimbursement
(c) Three (3) examples of the application of the formula
described above as "Resale Profit" to determine the amount of
the Agency Investment Reimbursement payable on the date of a
hypothetical resale of the New Home are presented as follows:
EXAMPLE A: Resale to a purchaser whose Adjusted Family Income
exceeds the income level of a Moderate Income Household:
Assume that on the Delivery Date the sales price of the New
Home payable by the Qualified Homebuyer was $156,000 and
that the resale occurs on the 7th anniversary following the
Delivery Date;
Assume the Resale Price of the New Home is $185,000; and
Assume that Qualified Homebuyer Equity as of the date of
the resale is $24,000:
EXAMPLE A CALCULATION OF RESALE
($19,0003+$5,0004)=$24,0005:Resale
BELOW) .
PROFIT: $185,0001-$137,0002-
Profit (SEE ALSO FOOTNOTES,
The
payable
example
Agency Investment Reimbursement amount under Example A
at close of the resale escrow in this hypothetical
is $18,000 (e.g., 75% of $24,000).
EXAMPLE B: Resale to a purchaser whose Adjusted Family Income
exceeds the income level of a Moderate Income Household:
Assume same facts as in Example A EXCEPT that the Resale
Price of the New Home is $220,000.
1 The Resale Price of the New Home to the Successor-In-Interest in
Example A.
2 The Purchase Money Mortgage amount ($130,000 conventional mortgage
plus $7,000 Agency MAP) of the New Home as of the Delivery Date.
3 The Qualified Homebuyer Equity in the New Home ($19,000 cash down
payment plus a $5,000 reduction of outstanding principal balance on the
Purchase Money Mortgage loans through the time of resale).
4 The Resale Cost Adjustment Factor in the 7th year.
5 The Resale Profit of $24,000 is subject to a 75% allocation to pay the
Agency Investment Reimbursement, or $18,000 payable to the Agency (as
provided in Section 5 (b) ) . The seller of this New Home could retain $6,000
of the "Resale Profit" in this example.
03-02-03 ANR-Headowbroot Develo~t Aqre~t
EXAMPLE B CALCULATION OF RESALE PROFIT: $215,0006 - $137,000 -
($19,0007 + $5, aDOs) = $54,0009: Resale Profit (SEE FOOTNOTES 6-
10, BELOW).
The Agency Investment Reimbursement under Example B payable
at close of the resale escrow in this hypothetical example is
$40,500. The seller of this New Home could retain $13,500 of
the "Resale Profit" in this example.
EXAMPLE C: Resale to a purchaser whose Adjusted Family Income
DOES NOT exceed the income level of a Moderate Income Household:
Assume same facts as in Example A and that the Successor-
In-Interest also pays no more than an Affordable Housing
Cost for the New Home at a resale price of $185,000 on the
7th anniversary date following the Delivery Date;
EXHIBIT C CALCULATION OF RESALE PROFIT:
No Agency Reimbursement is payable to Agency as the Successor-
In-Interest is a Moderate Income Household in this hypothetical
sale and pays to the Qualified Homebuyer no more than Affordable
Housing Cost for its purchase of the New Home. In this example,
the seller of the New Home could retail the full amount of the
Resale Profit or $24,000. Such Successor-In-Interest's
"Qualified Homebuyer Equity" will be adjusted to reflect that
buyer's new mortgage and equity basis in the New Home for
purposes of determining whether an Agency Reimbursement amount
may be payable by such Successor-In-Interest in any future
resale transaction during the remaining term of the Qualified
Residence Period.
(d) The sole source of funds of the Qualified Homebuyer to
pay the Agency the Agency Reimbursement Agreement, shall be from
the Resale Profit amount realized at the time of resale to a
purchaser whose Adjusted Family Income exceeds the income level
of a Moderate Income Household. In the event that the
applicable amount of the Agency Investment Reimbursement is paid
to the Agency at the time of resale of the New Home to a person
or household which does not qualify as a Successor-In-Interest,
6 Resale Price of New Home in Example B.
7 Purchase Money Mortgage amount is the same as in Example A.
8 The Qualified Homebuyer Equity is the same as in Example A.
9 The Resale Cost Adjustment Factor is the same as in Example A.
03-02-03 ANR-Keadowbroot Devel~t Aqr~t
the Agency shall cause to be
resale of the New Horne to such
the following provisions of this
recorded concurrently with the
person, a notice of release of
Section 33334.3 Covenant:
Section 2,
Section 3,
Section 5
Section 7
Section 6. Acknowledgment of Subordination of the
Provisions of Section 3, Section 5 and Section 7 (b) of this
Section 33334.3 Covenant to the Mortqage Security Interest of
the First Mortgage Lender.
Concurrently upon the execution and recordation of this
Section 33334.3 Covenant the Qualified Homebuyer shall obtain
certain purchase money mortgage financing for the acquisition of
the New Horne from (the "First Mortgage
Lender") . As of the Delivery Date, the Qualified Homebuyer has
provided the Agency with a true and correct copy of the loan
agreement by and between the First Mortgage Lender and the
Qualified Homebuyer.
As a condition to providing its mortgage loan to the
Qualified Homebuyer, the First Mortgage Lender requires the
Agency to agree that the provisions of Section 3, Section 5 and
Section 7 (b) of this Section 33334.3 Covenant shall be junior
and subordinate to the security interest of the First Mortgage
Lender of even date herewith, in the New Horne.
The Agency hereby acknowledges and agrees that the
provisions of Section 3, Section 5 and Section 7 (b) of this
Section 33334.3 Covenant are subordinate and junior to the
security interest of the First Mortgage Lender of even date
herewith in the New Horne. No breach or default by the Qualified
Homebuyer of any provision of Section 3 and/or Section 7 (b) of
this Section 33334.3 Covenant, nor the exercise by the Agency of
any remedy it may have against the Qualified Homebuyer in the
event of such a breach or default shall affect or render invalid
the lien of the First Mortgage Lender in the New Horne. In the
event that the First Mortgage Lender (or its assignee) may
foreclose the lien of the First Mortgage Lender in the New Horne
through trustee sale, judicial foreclosure or by acceptance of
deed in lieu of foreclosure, the First Mortgage Lender, and its
good faith purchasers for value, shall receive title in the New
Home free and clear of the provisions of Section 3, Section 5
and Section 7(b) of this Section 33334.3 Covenant.
Section 7. Foreclosure of Purchase Money Mortgage Loan and
Agency Right of First Refusal.
03-02-03 ANR~&dowbroo.lc o..elo.-ent Aqr--.nt
(a) During the Qualified Residence Period the Agency shall
have the right (but not the obligation) to bid on the purchase
of any mortgage loan lien secured. by the New Home at the time of
any trustee foreclosure sale or any judicial foreclosure sale.
(b) During the Qualified Residence Period the Agency shall
have the right of first refusal to purchase the New Home from
the Qualified Homebuyer on the same terms which the Qualified
Homebuyer may propose to sell the New Home to a third party who
does not qualify as a Successor-In-Interest. The Agency must
exercise such a right of first refusal within thirty (30) days
following written notification of the intention of the Qualified
Homebuyer to resell the New Home to such a third party, and such
notice shall be accompanied with a true and complete copy of the
written sale agreement between the Qualified Homebuyer and such
third party. If the Agency accepts the offer in writing within
such time period the Agency shall be bound to complete the
purchase of the New Home in accordance with the written sale
agreement of such third party. Thereafter the Agency shall pay
the "resale price" to the Qualified Homebuyer and close an
escrow for the transfer of the New Home to the Agency within
sixty (60) days following written notification of the intention
of the Qualified Homebuyer to resell the New House.
Section 8. Covenants to Run With the Land. The Developer,
the Agency and the Qualified Homebuyer hereby declare their
specific intent that the covenants, reservations and
restrictions set forth herein are part of a common plan for the
development of affordable single family housing improvements in
the Northwest Redevelopment Project and that each shall be
deemed covenants running with the land and shall pass to and be
binding upon the New Home and each Successor-In-Interest of the
Qualified Homebuyer in the New Home for the term provided in
Section 10. The Qualified Homebuyer hereby expressly assumes the
duty and obligation to perform each of the covenants and to
honor each of the reservations and restrictions set forth in.
this Section 33334.3 Covenant. Each and every contract, deed
or other instrument hereafter executed covering or conveying the
New Home or any interest therein shall conclusively be held to
have been executed, delivered and accepted subject to such
covenants, reservations, and restrictions, regardless of whether
such covenants, reservations and restrictions are set forth in
such contract, deed or other instrument.
and
and
Section 9. Burden and Benefit.
the Qualified Homebuyer hereby
intent that the burden of the
The Developer, the Agency
declare their understanding
covenants set forth herein
03-02-03 ANR.-He&c:Iowbroolc: DeY.l~t AQr..-ent
touch and concern the land in that the Qualified Homebuyer' s
legal interest in the New Horne is affected by the affordable
single family dwelling use and occupancy covenants hereunder.
The Agency and the Qualified Homebuyer hereby further declare
their understanding and intent that the benefit of such
covenants touch and concern the land by enhancing and increasing
the enjoyment and use of the New Horne by the intended
beneficiaries of such covenants, reservations and restrictions,
and by furthering the public purposes for which moneys from the
Low-and Moderate Income Housing Fund of the Northwest
Redevelopment proj ect were used and applied by the Agency in
order to make the New Horne available for acquisition and
occupancy by the Qualified Homebuyer.
Section 10. Term. This Section 33334.3 Covenant shall
apply to the New Horne and the Qualified Homebuyer and to each
Successor-In-Interest as of the Delivery Date for the Qualified
Residence Period -- e. g.: this Section 33334.3 Covenant shall
remain. in full force and effect for forty five (45) years after
the Delivery Date, except as to certain sections hereof as
provided in Section 5(d). Any provision or section hereof, may
be terminated after the Delivery Date upon agreement by the
Agency and the Qualified Homebuyer (or the Successor-In-Interest
in the New Home), if there shall have been provided to the
Agency an opinion of special legal counsel that such a
termination under the terms and conditions approved by the
Agency in its reasonable discretion will not adversely affect
the Agency or the investment of Low-and Moderate-Income Housing
Funds of the Agency in the New Home.
Section 11. Breach and Default and Enforcement.
(a) Failure or delay by the Qualified Homebuyer to honor
or perform any material term or provision of this Section
33334.3 Covenant shall constitute a breach under this Agreement;
provided however, that if the Qualified Homebuyer commences to
cure, correct or remedy the alleged breach within thirty (30)
calendar days after the date of written notice specifying such
breach and shall diligently complete such cure, correction or
remedy, the Qualified Homebuyer shall not be deemed to be in
default hereunder.
The Agency shall give the Qualified Homebuyer written
notice of breach specifying the alleged breach which if uncured
by the Qualified Homebuyer within thirty (3D) calendar days,
shall be deemed to be an event of default. Delay in giving such
notice shall not constitute a waiver of any breach or event of
defaul t nor shall it change the time of breach or event of
03-02-03 AHR-Headowbrook DeTel~t AqreGaent
default; provided, however, the Agency shall not exercise any
remedy for an event of default hereunder without first
delivering the written notice of breach as specified in this
Section 11.
Except with respect to rights and remedies expressly
declared to be exclusive in this Section 33334.3 Covenant, the
rights and remedies of the Agency are cumulative with any other
right or power of the Agency or the City or other applicable
law, and the exercise of one or more of such rights or remedies
shall not preclude the exercise by the Agency at the same or
different times, of any other right or remedy for the same
breach or event of default.
In the event that a breach of the Qualified Homebuyer may
remain incurred for more than thirty (30) calendar days
following written notice, as provided above, an event of default
shall be deemed to have occurred. In addition to the remedial
provisions of Section 4 as related to a Maintenance Deficiency
at the New Home, upon the occurrence of any event of default the
Agency shall be entitled to seek any appropriate remedy or
damages by initiating legal proceedings as follows:
(i) by mandamus or other suit, action or proceeding
at law or in equity, to require the Qualified
Homebuyer to perform its obligations and
covenants hereunder, or enjoin any acts or
things which may be unlawful or in violation of
the rights of the Agency; or
(ii)
by other action at law or in equity
necessary or convenient to enforce
obligations, covenants and agreements of
Qualified Homebuyer to the Agency.
as
the
the
(b) No third party shall have any right or
enforce any provision of this Section 33334.3 Covenant
of the Agency or to compel the Agency to enforce any
of this Section 33334.3 Covenant against the Qualified
on the New Home.
power to
on behalf
provision
Homebuyer
Section 12. Governing Law. This Section 33334.3 Covenant
shall be governed by the laws of the State of California.
Section 13. Amendment. This Section 33334.3 Covenant may
be amended after the Delivery Date only by a written instrument
executed by the Qualified Homebuyer (or the Successor-In-
Interest, as applicable) and by the Agency. The Developer shall
03-02-03 ANR-Headowbrook DeveloJ*8llt AqreelMJlt
have not any right or
this Section 33334.3
Developer of any such
not be required.
power to approve any such amendment to
Covenant, and the execution by the
amendment after the delivery date shall
Section 14. Attorney's Fees. In the event that the
Agency brings an action to enforce any condition or covenant,
representation or warranty in this Section 33334.3 Covenant or
otherwise arlslng out of this Section 33334.3 Covenant, the
prevailing party in such action shall be entitled to recover
from the other party its reasonable attorneys' fees to be fixed
by the court in which a judgment is entered, as well as the
costs of such suit. For the purposes of this Section, the words
"reasonable attorneys' fees" in the case of the Agency shall
mean and include the salaries and benefits payable to lawyers
employed by the Office of City Attorney, allocated on an hourly
basis, who provide legal services to the Agency in connection
with the enforcement of this Agreement.
Section 15. Severability. If any provision of this
Section 33334.3 Covenant shall be declared invalid, inoperative
or unenforceable by a final judgment or decree of a court of
competent jurisdiction such invalidity or unenforceability of
such provision shall not affect the remaining parts of this
Section 33334.3 Covenant which are hereby declared by the
parties to be severable from any other part which is found by a
court to be invalid or unenforceable.
Section 16. Time
of this Section 33334.3
of time within which
satisfied, time shall be
is of the Essence. For each prOV1Slon
Covenant which states a specific amount
the requirements thereof are to be
deemed to be of the essence.
Section 17. Notice. Any notice required to be given
under this Section 33334.3 Covenant shall be given by the Agency
or by the Qualified Homebuyer, as applicable, by personal
delivery or by First Class United States mail at the addresses
specified below or at such other address as may be specified in
writing by the parties hereto:
If to the Agency:
Executive Director
Redevelopment Agency of the
City of San Bernardino
201 North "E" Street, Ste 301
San Bernardino, CA 92401
Phone: (909) 384-5081
OJ~2-03 AHR-Keadowbrook Oevel~t Aqre~t
If to the
Qualified Homebuyer:
Attn:
Phone:
Notice shall be deemed given five (5) calendar
date of mailing to the party, or, if personally
received by the Executive Director of the
Qualified Homebuyer, as applicable.
03-02-03 ANR-Headowbrook Develot-ent Aqreeaent
days after the
delivered, when
Agency or the
IN WITNESS WHEREOF, the Developer, the Qualified Homebuyer
and the Agency have caused this Section 33334.3 Covenant to be
signed, acknowledged and attested on their behalf by duly
authorized representatives in counterpart original copies which
shall upon execution by all of the parties be deemed to be one
original document. The recordation of this Section 33334.3
Covenant is authorized under Health and Safety Code Section
33334.3 (g) .
QUALIFIED HOMEBUYER
Dated:
By:
By:
DEVELOPER
ANR Industries, Inc., a California
corporation
By:
Dated:
AGENCY
Redevelopment Agency of the
City of San Bernardino
By:
Dated:
Executive Director
[ALL SIGNATURES MUST BE NOTARIZED]
Approved as to Form:
BY' A{2~ I(~!.J?
03-02-03 Nm-Meadowbrook Oe.elo~nt Aqreeaent
4\5:- L ~b:,-~5+L:,
;: 2:-< 0.1
EXHIBIT "T
FORM OF AGENCY LOT PURCHASB PRICE
PROMISSORY NOTE AND DEED OF TRUST
(TO SECURE PAYMENT OF AGENCY LOT PURCHASE PRICE)
12
EXHIBIT "I"
PURCHASE MONEY PROMISSORY NOTE
PAY ABLE TO A PUBLIC AGENCY SECURED BY REAL PROPERTY
(AGENCY LOT PROMISSORY NOTE)
Borrower:
Lender:
Meadowbrook Park Homes, Inc.
10702 Hathaway Drive
Suite 1
Santa Fe Springs, California 90607
Redevelopment Agency of the City of San
Bernardino
201 North "E" Street, Suite 301
San Bernardino, California 92401
Principal Amount:
$30,000.00
Date of this Agency Lot Promissory Note:
,200_
Interest Rate: 6% per annum
as provided in Paragraph 4
Maturity Date of Promissory Note:
See Paragraoh 3, below
This Purchase Money Promissory
Note is given for a:
n Type A Agency Lot
[J Type B Agency Lot
[Check One]
Agency Lot
Assessor Parcel No.
I. PROMISE TO PAY. MEADOWBROOK P ARK HOMES, INC., a California
corporation (the "Borrower"), promises to pay to the Redevelopment Agency of the City of San
Bernardino (the "Agency" or "Holder"), or order, in lawful money of the United States of
America, the principal sum of Thirty Thousand and 00/1 00 Dollars ($30,000.00), together with
interest on the unpaid outstanding principal balance from time to time as set forth below.
2. INDEBTEDNESS. This Purchase Money Promissory Note evidences the indebtedness
of the Borrower to the Agency to pay the Agency Lot Purchase Price for the Agency Lot
identified above, under the terms and conditions of that certain 2004 Meadowbrook Single
Family Residential Development Agreement (Meadowbrook Neighborhood Restoration Area),
dated as of December 20, 2004 by and between Borrower and the Agency (the "2004
Agreement"). This Promissory Note is referred to in the 2004 Agreement as an "Agency Lot
Promissory Note." Unless otherwise indicated in this Agency Lot Promissory Note, the meaning
of defined terms and phrases as denoted by an initial capitalized letter in a word or phrase, shall
be the same as set forth in the 2004 Agreement. A copy of the 2004 Agreement is on file with the
Secretary of the Agency as a public record of the Agency and the 2004 Agreement is available
for inspection and copying by all interested persons in accordance with applicable law.
4818-8767-6416.3
1
3.
A.
PAYMENT.
Borrower may make payments according to this section of the Agency Lot Promissory
Note.to the Agency at its address set forth above or such other address as later communicated in
writing to Borrower by the Agency, in immediately available U.S. currency. Payments shall be
applied first to unpaid fees, costs, and expenses which are reimbursable under the terms of this
Agency Lot Promissory Note or the 2004 Agreement, then to any late charges, then to accrued
unpaid interest, then to outstanding principal.
B. FINAL PAYMENT.
All accrued and unpaid interest, late payment charges, outstanding principal, and all other
amounts chargeable under this Agency Lot Promissory Note or the 2004 Agreement shall be due
and payable in full on the Maturity Date. For purposes of this Agency Lot Promissory Note the
Maturity Date shall be the date which is the fifth (5th) anniversary following the date of this
Agency Lot Promissory Note; provided however, that all principal and accrued and unpaid
interest shall be immediately due and payable to the Agency sooner than the Maturity Date, on
the date when a deed transferring the fee title of the Agency Lot from the Borrower to a third
party purchaser is recorded in the official records of the County of San Bernardino Recorder's
Office.
4. INTEREST RATE. If this Agency Lot Promissory Note corresponds to a Type C
Agency Lot [See Box checked above], then interest shall commence to accrue from its date at the
rate of six percent (6%) per annum.
If this Agency Lot Promissory Note corresponds to a Type A Agency Lot [See Box
checked above], then no interest shall accrue on the outstanding principal balance of this Agency
Lot Promissory Note, for a period of eighteen (18) months, from the date of this Agency Lot
Promissory Note set forth above. Thereafter, interest shall begin to accrue on the outstanding
principal balance of this Agency Lot Promissory Note commencing on the first day of the
nineteenth month from the date of the Promissory Note set forth above at the rate of six percent
(6%) per annum.
Interest on this Agency Lot Promissory Note shall be computed on a 365/360 simple
interest basis; that is, by applying the ratio of the annual interest rate over a year of 360 days,
multiplied by the outstanding principal balance, multiplied by the actual number of days the
principal balance is outstanding.
5. PREPAYMENT. Borrower may pay without penalty all or a portion of the amount
owed under this Agency Lot Promissory Note earlier than it is due.
6. DEF AUL T. Borrower will be in default if any of the following happens:
A. Failure of the Borrower to make any payment to the Agency within five (5) days
of written notice due under this Agency Lot Promissory Note or the 2004 Agreement.
4818-8767-6416.3
2
B. Failure of the Borrower to make any payment to a Senior Lender (as defined in
the 2004 Agreement) when due. after any applicable notice and cure period.
C. Failure of the Borrower to make any required payment to the Agency when due
under the 2004 Agreement and/or failure of the Borrower to comply with or to perform when due
any term, obligation. covenant or conditions of the 2004 Agreement after notice from the Agency
under any applicable notice and cure terms of the 2004 Agreement, if the failure is not cured in
accordance with the cure provisions of the 2004 Agreement.
D. Failure of the Borrower to comply with or to perform when due any other term
obligation, covenant or condition contained in this Agency Lot Promissory Note or any other
agreement which secures this Agency Lot Promissory Note, after notice from the Agency, under
the applicable notice and cure terms.
E. Failure of the Borrower to comply with or to perform when due any term,
obligation, covenant or condition of any loan or extension of credit from any Senior Lender
(other than a failure of the Borrower to make any payment to such Senior Lender when due), or
to comply with or to perform when due any term, obligation, covenant or condition of such loan
or extension of credit (other than a failure of the Borrower to make any payment), after notice
from such Senior Lender under the applicable notice and cure terms of such obligations of the
Borrower.
F. Any warranty, representation or statement made or furnished to the Agency by or
on behalf of the Borrower pursuant to the 2004 Agreement is false or misleading in any material
respect at the time made or furnished.
G. The 2004 Agreement, this Agency Lot Promissory Note or the Deed of Trust
ceases to be in full force and effect at any time and for any reason (including failure of any
collateral document to create a valid and perfected security interest or lien) due to a default by
the Borrower and failure to cure such default during any applicable cure period and other than by
virtue of the repayment satisfaction and/or mutual release of any such obligation.
H. The dissolution or the termination of the Borrower's existence as a going business
of the insolvency of the borrower. or the appointment of a receiver for any part of the Borrower's
property, any assignment for the benefit of creditors under any type of creditor workout, or the
commencement of any proceeding under any bankruptcy or insolvency laws, unless such
proceedings are discharge or dismissed within ninety (90) days following commencement by or
against the Borrower.
1. Commencement of foreclosure or forfeiture proceedings, whether by judicial
proceeding, non-judicial foreclosure, self-help, repossession or any other method, by any creditor
of the Borrower or by any governmental agency, against any collateral securing this Agency Lot
Promissory Note, or by any governmental agency, unless such proceedings are discharged or
dismissed within ninety (90) days following commencement. However, this event of default
shall not be deemed to have occurred if there is a good faith dispute by the Borrower as to the
validity or reasonableness of the claim which is the basis of the creditor or forfeiture proceeding,
4818-8767-t416.3 3
and if the Borrower gives the Agency written notice of the creditor or forfeiture proceeding and
furnishes reserves or a surety bond for the creditor or forfeiture proceeding satisfactory to the
Agency and proceeds to vigorously defend against such a claim.
J. Sale, transfer, hypothecation, assignment, or conveyance of the Property or any
portion or interest in the Agency Lot or the Project by the Borrower without the Agency's prior
written consent.
If any default (other than a default described in (A), (B) or (F) above) is curable, and if Borrower
has not been given a notice of a default of the same provision of this Agency Lot Promissory
Note within the preceding twelve (12) months, such a default may be cured (and in such event no
default will be deemed to have occurred) if Borrower, after receiving written notice from the
Agency demanding cure of such default:
(i) cures the default within thirty (30) calendar days; or
(ii) if the cure requires more than thirty (30) calendar days, immediately
initiates steps which the Agency deems in its reasonable discretion to be
sufficient to cure the default, and thereafter Borrower continuously
pursues such cure to completion.
7. RIGHTS OF THE HOLDER. Upon default by the Borrower, the Agency may exercise
any of its rights provided under the 2004 Agreement, including, without limitation, the
declaration by the Agency or the holder in due course of this Agency Lot Promissory Note
(individually or collectively the "Holder"') that the entire unpaid principal balance of this Agency
Lot Promissory Note and all accrued and unpaid interest is immediately due and payable,
without notice or presentment. Upon the failure of the Borrower to pay all amounts declared due
pursuant to this paragraph entitled "RIGHTS OF THE HOLDER," including failure to pay at the
Maturity Date, the Holder, at its option, may also, if permitted under applicable law, increase the
interest rate on this Agency Lot Promissory Note for interest which accrues after the date such
amount is declared due, to the rate of twelve percent (12%) per annum. The Holder may hire or
pay someone else to help collect this Agency Lot Promissory Note, if the Borrower does not pay.
The Borrower will pay the Holder the amount of any and all such collection related expenses,
including without limitation. subject to any limits under applicable law, the Holder's reasonable
attorneys' fees. whether or not there is a lawsuit, including, without limitation. reasonable
attorneys' fees and legal expenses for bankruptcy proceedings (including efforts to modify or
vacate any automatic stay or injunction), appeals, and any post-judgment collection services.
The Borrower also will pay any court costs, in addition to all other sums provided by law. This
Agency Lot Promissory Note has been delivered to the Holder and accepted by the Holder in the
State of California. If there is a lawsuit arising under this Agency Lot Promissory Note, the
Superior Court of the State of California and for the County of San Bernardino shall have
jurisdiction of such lawsuit. This Agency Lot Promissory Note shall be governed by and
construed in accordance with the laws of the State of California.
8. COLLA TERAL. The Borrower acknowledges this Agency Lot PromISSOry Note is
secured by a deed of trust (the "Deed of Trust") encumbering the Agency Lot which is the
4818-8767-64163 4
property commonly know as and further described in Exhibit uk'
attached hereto and by this reference made a part hereof. Pursuant to Civil Code Section 2924.5
the following language is contained in the Deed of Trust relative to the rights of the Agency to
accelerate the Maturity Date of the loan upon the occurrence of certain events:
"Impairment of Securitv. Trustor shall not, without first obtaining
Beneficiary" s ~Titten consent, assign any of the rents or profits of the
Property or change the general nature or use of the Property or initiate or
acquiesce in any zoning reclassification, or do, or suffer to be done, any act
or thing that would impair the security of Beneficiary's lien upon the
Property or the rents thereof. Trustor shall not, without the written consent
of Beneficiary, (i) initiate or support any zoning reclassification of the
Property, seek any variance under existing zoning ordinances applicable to
the Property or use or permit the use of the Property in a manner that would
result in such use becoming a non-conforming use under applicable zoning
ordinances; (ii) modify, amend or supplement any easement, reservation,
restriction, covenant, condition or encumbrance pertaining to the Property;
(iii) impose or consent to any restrictive covenant or encumbrance upon the
Property, execute or file any subdivision or parcel map affecting the
Property or consent to the annexation of the Property to any municipality;
or (iv) permit or suffer the Property to be used by the public or any person
in such manner as might make possible a claim of any implied dedication
or easement."
9. GENERAL PROVISIONS. The Holder may delay or forego enforcing any of its rights
or remedies under this Agency Lot Promissory Note without losing them. Borrower and any
other person who signs, guarantees or endorses this Agency Lot Promissory Note, to the extent
allowed by law, each waive any applicable statute of limitations, presentment, demand for
payment, protest and notice of dishonor. Upon any change in the terms of this Agency Lot
Promissory Note, and unless otherwise expressly stated in writing, no party who signs this
Agency Lot Promissory Note, shall be released from liability. All such parties agree that the
Holder may renew or extend (repeatedly and for any length of time) this Agency Lot Promissory
Note, or release any party, or collateral; or impair, fail to realize upon or perfect the Holder's
security interest in any collateral; and take any other action deemed necessary by the Holder in
its sole discretion without the consent of or notice to anyone. All such parties also agree that the
Holder may modify this Agency Lot Promissory Note and/or the 2004 Agreement without the
consent of or notice to anyone other than the party with whom the modification is made.
~818-8767-6416.3
5
PRIOR TO SIGNING THIS PROMISSORY NOTE, BORROWER HAS READ AND
UNDERST ANDS ALL OF ITS PROVISIONS. BORROWER AGREES TO THE TERMS OF
THIS PROMISSORY NOTE AND ACKNOWLEDGES RECEIPT OF A COpy HEREOF.
BORROWER
Meadowbrook Park Homes. Inc.. a California corporation
By:
Its:
~,:,-,'6'-b..lb.;
6
EXHIBT "A"
LEGAL DESCRIPTION OF AGENCY LOT
~R 18-876 7-6~ 16.3
7
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
Redevelopment Agency of the
City San Bernardino
Attention: Executive Director
20 I North "E" Street. Suite 30 I
San Bernardino, California 92401
DEED OF TRUST. ASSIGNMENT OF LEASES AND RENTS.
FIXTURE FILING AND SECURITY AGREEMENT
THIS DEED OF TRUST, ASSIGNMENT OF LEASES ANP RENTS, FIXTURE
FILING AND SECURITY AGREEMENT ("Deed of Trust") is made as of , 2004,
by Meadowbrook Park Homes, Inc.. a California corporation ("Trustor"), whose address is
to
("Trustee"). whose address is . for the benefit of the
REDEVELOPMENT AGENCY FOR THE CITY OF SAN BERNARDINO, a public body
corporate and politic. its successors and assigns ("Beneficiary"), whose address is 20 I North "E"
Street, Suite 301, San Bernardino, California 92401.
WITNESSETH
That Trustor, for valuable consideration, grants, bargains, sells, conveys and warrants to
Trustee, in trust with power of sale, that property in the City of San Bernardino, County of San
Bernardino. State of California, more particularly described in Exhibit "A" attached hereto and
made a part hereof (the "Land"), together with the following described estate, property and rights
of Trustor in the Land and/or in any improvements now or hereafter constructed thereon
(severally and collectively, the "Property") as security for the performance of each covenant and
agreement of Trustor contained herein and in all other instruments executed in connection
herewith, and for the payment of all sums of money secured hereby.
A. All the fee and leasehold estates and rights of Trustor now held and hereafter
acquired in and to the Property and in and to land lying in streets and roads adjoining the
Property, and all access rights and easements appertaining thereto; and
B. All buildings, structures, improvements, furnishings, fixtures and equipment, real,
personal and mixed, now or hereafter attached to, or used or adapted for use in the operation of
the Property and any and all replacements and additions thereto, including without limitation. all
heating apparatus and equipment whatsoever, all boilers, engines, motors, dynamos, generating
equipment. pumps, piping and plumbing fixtures, cooling, ventilating, sprinkling, fire-
extinguishing apparatus, gas and electric fixtures, elevators, escalators, partitions. and shrubbery
and plants; and including also all interest of any owner of the Property in any of such items
hereafter at any time acquired under conditional sales contract, chattel mortgage or other title-
retaining or security instrument, all of which property mentioned in this paragraph shall be
~828.2720-O512.2
12,6104
1
deemed part of the realty and not severable wholly or in part without material injury to the
freehold; and
C. All and singular the lands, tenements, privileges, water, water rights, water stock,
mineral, oil and gas rights, hereditaments and appurtenances thereto belonging or in anywise
appertaining, and the reversion and reversions, remainder and remainders, rents, royalties, issues
and profits thereof, and all the estate, rights, title, claim, interest and demand whatsoever of the
Trustor either in law or equity, of, in and to the Property, whether now held or hereafter
acquired; and
D. All of the right, title and interest of Trustor now or hereafter existing in and to the
following now or hereafter located in, upon, within or about or used in connection with the
construction, use, operation or occupancy of the Property and/or the improvements thereon and
any business or activity conducted thereon or therein, together with all accessories, additions,
accessions, renewals, replacements and substitutions thereto or therefor and the proceeds and
products thereof: (i) all materials, supplies, furniture, furnishings, appliances, office supplies,
equipment, construction materials, vehicles, machinery, computer hardware and software,
maintenance equipment, window washing equipment, repair equipment and other equipment and
tools, telephone and other communications equipment; (ii) all books, ledgers, records,
accounting records, files, tax records and returns, policy manuals, papers, correspondence, and
electronically recorded data; (iii) all '.General Intangibles" (as such term is defined in the
California Commercial Code), instruments, money, "Accounts," (as such term is defined in the
California Commercial Code), accounts receivable, notes, certificates of deposit, chattel paper,
letters of credit, choses in action, good will, rights to payment of money, rents, rental fees,
equipment fees and other amounts payable by persons who utilize the Property or any of the
improvements or paid by persons in order to obtain the right to use the Property and any of the
improvements, whether or not so used; trademarks, service marks, trade dress, tradenames,
licenses, sales contracts, deposits, plans and specifications, drawings, working drawings, studies,
maps, surveys; soils, environmental, engineering or other reports, architectural and engineering
contracts, construction contracts, construction management contracts, surety bonds, feasibility
and market studies, management and operating agreements, service agreements and contracts,
landscape maintenance agreements, security service and other services agreements and vendors
agreements; (iv) all compensation, awards and other payments or relief (and claims therefor)
made for a taking by eminent domain, or by any event in lieu thereof (including, without
limitation, property and rights and interests in property received in lieu of any such taking), of all
or any part of the Property (including without limitation, awards for severance damages),
together with interest thereon, and any and all proceeds (or claims for proceeds) of casualty,
liability or other insurance pertaining to the Property, together with interest thereon; (v) any and
all claims or demands against any person with respect to damage or diminution in value to the
Property or damage or diminution in value to any business or other activity conducted on the
Property; (vi) any and all security deposits, deposits of security or advance payments made to
others with respect to: (I) insurance policies relating to the Property; (2) taxes or assessments of
any kind or nature affecting the Property; (3) utility services for the Property and/or the
improvements; (4) maintenance, repair or similar services for the Property or any other services
or goods to be used in any business or other activity conducted on the Property; (vii) any and all
authorizations, consents, licenses, permits and approvals of and from all persons required from
~828-2720-O512.2
\2,6104
2
time to time in connection with the construction, use, occupancy or operation of the Property, the
improvements, or any business or activity conducted thereon or therein or in connection with the
operatIOn, occupancy or use thereof, (viii) all warranties, guaranties, utility or street
improvement bonds, utility contracts, telephone exchange numbers, yellow page or other
directory advertising and the like; (ix) all goods, contract rights, and inventory; (x) all leases and
use agreements of machinery, equipment and other personal property; (xi) all insurance policies
covering all or any portion of the Property; (xii) all reserves (including those provided for in
Section 17 hereof) and funds held in escrow by Beneficiary or other person for Beneficiary's
benefit and any funds deposited with Beneficiary, all accounts into which such funds are
deposited and all accounts, contract rights and general intangibles or other rights relating thereto;
(xiii) all names by which the Property is now or hereafter known; (xiv) all interests in the
security deposits of tenants; (xv) all management agreements, blueprints, plans, maps,
documents, books and records relating to the Property; (xvi) the proceeds from sale, assignment,
conveyance or transfer of all or, any portion of the Property or any interest therein, or from the
sale of any goods, inventory or services from, upon or within the Property and/or the
improvements (but nothing contained herein shall be deemed a consent by Beneficiary to such
sale, assignment, conveyance or transfer, except as expressly provided in this Deed of Trust);
(xvii) any property described in paragraph B, above, which are not fixtures under California law;
(xviii) all other property (other than fixtures) of any kind or character as defined in or subject to
the provisions of the California Uniform Commercial Code, Secured Transactions, as amended
and; (xix) all proceeds of the conversions, voluntarily or involuntarily, of any of the foregoing
into cash or liquidated claims.
TO HAVE AND TO HOLD the Property, together with all and singular the lands,
tenements, privileges, water, water rights, water stock, mineral, oil and gas rights, hereditaments
and appurtenances thereto belonging or in any wise appertaining, and the reversion and
reversions, remainder and remainders, rents, royalties, issues and profits thereof, and all of the
estate, right, title, claims and demands whatsoever of the Trustor, either in law or in equity, of, in
and to the Property, forever as security for the faithful performance of the Obligations (as
defined below) secured hereby and as security for the faithful performance of each and all of the
covenants, agreements, terms and conditions of this Deed of Trust, and in all other instruments
executed in connection herewith, SUBJECT, HOWEVER, to the right, power and authority
given to and conferred upon Beneficiary to collect and apply such rents, issues and profits. This
Deed of Trust also constitutes a security agreement in all of the property above described or
referenced in which such interest may be created under the California Commercial Code and for
such purposes Trustor hereby grants to Beneficiary a security interest therein.
1. Agencv Loan Secured. This Deed of Trust is made for the purpose of securing (i)
the prompt payment of the Note (as defined below), together with all interest, premiums and
other amounts, if any, due in accordance with the terms of the Note and that certain 2004
Meadowbrook Single Family Residential Development Agreement (Meadowbrook
Neighborhood Restoration Area) by and between the Redevelopment Agency for the City of San
Bernardino and ANR Industries, Inc., dated as of December 20, 2004 (the "DDA"), and all
references therein, regarding the payment of the principal sum of THIRTY THOUSAND
DOLLARS ($30,000.00) (the "Loan") as evidenced by that certain Purchase Money Promissory
Note Payable To A Public Agency Secured By Real Property of even date herewith (which note,
~R28-2720-D5122
12,0'04
3
together with all notes issued in substitution or exchange therefore and all amendments thereto.
is referred to as the "Note"). which amount constitutes the purchase price for Trustor's
acquisition of the Property from the Agency and all other instruments or agreements executed in
connection therewith, and all interest thereon and other amounts evidenced thereby; all future
advances made to Trustor by Beneficiary, its successors and assigns, under the DDA or pursuant
to the terms of this Deed of Trust or any other instruments or agreements executed in connection
with or to secure the covenants of the Trustor set forth in the DDA (collectively, the
"Transaction Documents"); (ii) the prompt performance of each and every covenant condition.
and agreement contained in the Transaction Documents; (iii) the payment of any and all other
debts, claims. obligations. demands, monies, liabilities and indebtedness of any kind or nature
now or hereafter owing, arising, due or payable from Trustor to Beneficiary, when the document
evidencing the same specifically refers to this Deed of Trust and that it is intended to be secured
hereby; and (iv) the obligations evidenced by all renewals, extensions, modifications,
substitutions and conditions of any of the Transaction Documents; and any and all other
obligations of Trustor to Beneficiary, its successors and assigns, now existing and hereafter
arising and which are at any time specifically declared by Beneficiary and Trustor in writing to
be secured by this Deed of Trust or which specifically indicate in the instruments which evidence
the same that they are intended to be so secured. All obligations of Trustor to Beneficiary
pursuant to the Transaction Documents are sometimes collectively referred to as the
"Obligations".
2. Trustor's Covenant ofPavment Trustor shall perform all of its obligations under
the Transaction Documents and under this Deed of Trust when due, without excuse or delay of
any kind whatsoever, except as expressly provided herein or therein, and Trustor shall pay the
Loan, and all other debts and monies secured by this Deed of Trust when due without set off or
deduction of any kind.
3. Trustor's Warranties of Title. Trustor warrants to Beneficiary that it is the sole
holder of fee simple absolute title to all of the Property and that except as set forth in Paragraph
27 of this Deed of Trust and the DDA relative to financing the construction of improvements on
the Land said title is marketable and free from any lien or encumbrance, unless approved in
writing by Beneficiary, and the liens imposed by law for nondelinquent real property taxes and
assessments. Trustor further covenants and agrees as follows: that except as required under the
DDA and/or construction financing documents, Trustor will keep the Property free from all liens
of any kind, including, without limitation, statutory and governmental; that no lien superior or
junior to this Deed of Trust will be created or suffered to be created by Trustor during the life of
this Deed of Trust without Beneficiary's prior written consent: that Trustor has good right to
make this Deed of Trust and the person or persons executing this Deed of Trust on behalf of
Trustor has or have the authority to do so; and that Trustor will forever warrant and defend
Beneficiary's interest in the Property against every person, whomsoever. claiming any right or
interest in the Property or any part thereof.
4. Trustor's Right to Contest Statutory Liens. As used herein the words "mechanic's
lien" and "materialmen's lien" mean and include a "stop notice" as this term is defined in
California Civil Code Sections 3179. et seq. The filing of a mechanic's or materialmen's lien
against the Property or a stop notice against the Trustor or the Beneficiary and/or funds held by
-+8.2~-::720-O512.2
:26,04
4
or owed to the Trustor for the improvement of the Property shall not constitute a default
hereunder, if and so long as (a) no defaults exist under the DDA, this Deed of Trust, or any of the
other Transaction Documents; (b) within fifteen (15) days after filing of such lien, Trustor
obtains and maintains in effect a bond issued by a California admitted surety acceptable to
Beneficiary in an amount not less than 125% of the entire sum alleged to be owed to the lien
claimant or such other amount as is required to obtain a court order to release said lien of record:
(c) Trustor immediately commences its contest of such lien and continuously pursues the same in
good faith and with due diligence; (d) such bond or contest stays the foreclosure of the lien: and
(e) Trustor pays in full any judgment rendered for the lien claimant within ten (10) days
following entry of any such judgment.
5. Maintenance and Inspection of Improvements. Trustor shall maintain the
buildings and other improvements now or hereafter located on the Property in good condition
and state of repair. Trustor shall not commit or suffer any waste on the Property, shall promptly
comply with all requirements of federal, state and municipal authorities and all other laws,
ordinances. regulations, covenants, conditions and restrictions respecting the Property or the use
thereof, and shall pay all fees or charges of any kind in connection therewith.
6. Construction and Repairs. This Deed of Trust is given to secure an obligation for
the repayment of the Loan for the purchase of the Property anticipated to be developed with the
Project (as defined in the DDA) and, without limiting the application of any provision of the
DDA or any other Transaction Document, Trustor therefore further agrees:
(a) To promptly commence construction of the Project and promptly
complete the same, at the time required by and in accordance with the Transaction Documents
and all other agreements between Trustor and Beneficiary relating to construction of the Project:
and
(b) To allow Beneficiary to inspect said Property at all reasonable times.
Trustor shall complete or restore promptly and in a good and workmanlike manner any
building or improvement that may be constructed, damaged or destroyed on the Property, and
pay when due all costs incurred therefor.
7. Alterations. No building or other improvement on the Property shall be
structurally altered. removed or demolished without the Beneficiary's prior \\Titten consent. nor
shall any fixture or chattel covered by this Deed of Trust and adapted to the proper use and
enjoyment of the Property be removed at any time without Beneficiary's prior \\Titten consent.
unless actually replaced by an article of equal suitability and value, owned by the Trustor, free
and clear of any lien or security interest, except such as may be approved in writing by the
Beneficiary.
8. Compliance With Laws. Trustor shall comply with all statutes, laws. ordinances
and regulations which now or hereafter pertain to the construction, repair, condition, use and
occupancy of the Property, including, without limitation, all environmental, subdivision, zoning,
building code, fire, occupational, health, safety, occupancy and other similar or dissimilar
-1R:!S':~:20"()51 2.2
12 (),O-J.
5
statutes, and shall not permit any tenant or other occupant of any portion of the Property to
violate the same. If any statute or order of any court of competent jurisdiction requires any
correction, alteration or retrofitting of any improvements on or related to the Property, Trustor
shall promptly undertake the required repairs and restoration and complete the same with due
diligence at its sole cost and expense.
9. Environmental Covenants. Representations. Warranties and Indemnity.
(a) Trustor will not use any Hazardous Materials (as defined herein below) in
the construction of the Project or other improvements on or about the Property.
(b) Trustor shall, at its sole expense, comply and cause each tenant occupying
or leasing space within the Property to comply with all applicable laws, regulations, codes and
ordinances relating to any Hazardous Materials or to any Environmental Activities (as defined
herein below), including, without limitation, obtaining, filing, serving or posting all applicable
notices, permits, licenses and similar authorizations. Trustor shall establish and maintain a
management and operating policy for the Property to assure and monitor continued compliance
by Trustor and each tenant occupying or leasing space in the Property with all such laws,
regulations. codes and ordinances.
(c) Trustor agrees to submit from time to time, if requested by Beneficiary, a
report reasonably satisfactory to Beneficiary, certifying that the Property is not now being used
for any Environmental Activities. Beneficiary reserves the right, in its reasonable discretion, to
retain an independent professional consultant to review any report prepared by Trustor and/or to
conduct its own investigation of the Property for Hazardous Materials. Trustor hereby grants to
Beneficiary, its agents, employees, consultants and contractors the right to enter upon the
Property to perform such tests, at Beneficiary's sole expense, as are reasonably necessary to
conduct a review and/or investigation.
(d) Upon the discovery by Trustor of any event or situation which would
render any of the representations or warranties contained in subparagraph 9(g) hereof inaccurate
in any respect, if made at the time of such discovery, Trustor shall promptly notify Beneficiary of
such event or situation and, within thirty (30) days after such discovery, submit to Beneficiary a
preliminary written environmental plan setting forth a general description of such event or
situation and the action that Trustor proposes to take with respect thereto. Within sixty (60) days
after such discovery, Trustor shall submit to Beneficiary a final written environmental report,
setting forth a detailed description of such event or situation and the action that Trustor proposes'
to take with respect thereto, including, without limitation, any proposed corrective work, the
estimated cost and time of completion, the name of the contractor and a copy of the construction
contract, if any, and such additional data, instruments, documents, agreements or other materials
or information as Beneficiary may reasonably request. The plan shall be subject to Beneficiary's
prior written approval, which approval may be granted or withheld in Beneficiary's sole but
reasonable discretion. Beneficiary shall notify Trustor in writing of its approval or disapproval of
the final plan within fifteen (15) days after receipt thereof by Beneficiary. If Beneficiary
disapproves the plan, Beneficiary's notice to Trustor of such disapproval shall include a brief
explanation of the reasons therefor. Trustor shall submit to Beneficiary a revised final written
~828-2720'()512.2
12,6,0'+
6
environmental plan that remedies the defects identified by Beneficiary as reasons for
Beneficiary's disapproval of the previous plan. If Trustor fails to submit a revised plan to
Beneficiary within said thirty (30) day period, or if such revised plan is submitted to Beneficiary
and Beneficiary disapproves said plan, such failure or disapproval shall, at Beneficiary's option
and upon notice to Trustor, constitute an "Event of Default" hereunder. If Beneficiary does not
notify Trustor of its approval or disapproval of the final plan or any revisions thereof within the
fifteen (15) day period described above, Trustor shall provide written notice to Beneficiary of
Beneficiary's failure to respond. at which time Beneficiary shall have an additional forty-five
(45) days after receipt of such notice from Trustor to notify Trustor of its approval or disapproval
of the final plan within said additional forty-five (45) day period. If Beneficiary fails to notify
Trustor of its disapproval or approval of said plan within said forty-five (45) day period the plan
shall be deemed approved. Once any such plan is approved in writing or deemed approved by
Beneficiary, Trustor shall promptly commence all action necessary to implement such plan and
to comply with any requirements or conditions imposed by Beneficiary, and shall diligently and
continuously pursue such action to completion in strict accordance with the terms of said plan.
The rights of Beneficiary with respect to the approval or disapproval of the environmental plan
set forth herein and the actions of Beneficiary pursuant to such rights are not intended to, and
shall not, in and of themselves, confer on Beneficiary a right to manage, operate or control the
Property on a continuing basis following the discovery of the event(s) or occurrence(s) described
in this subparagraph 9(d).
(e) Trustor agrees to submit from time to time, if requested by Beneficiary, a
report, reasonably satisfactory to Beneficiary, specifying any activities involving, directly or
indirectly, the use, generation, treatment, storage or disposal of any Hazardous Materials on the
Property. Beneficiary reserves the right, in its sole and reasonable discretion, to retain, at its own
expense, an independent professional consultant to review any report prepared by Trustor and/or
to conduct its own investigation of the Property. Trustor hereby grants to Beneficiary, its agent,
employees, consultants and contractors the right to enter upon the Property and to perform such
tests as Beneficiary deems are necessary to conduct such a review and/or investigation.
Beneficiary shall hold in confidence any report delivered by Trustor to Beneficiary pursuant to
this Section 9, except for disclosure to (a) any consultant(s) hired by Beneficiary to review said
report, (b) legal counsel, accountants and other professional advisors to Beneficiary, (c)
regulatory officials having jurisdiction over Beneficiary who may request said report, (d) as
required by any federal, state, county, regional or local authority or law, rule, regulation or
ordinance, and (e) as required in connection with any legal proceeding.
"Hazardous Materials" as used in this Deed of Trust shall mean any hazardous or
toxic materials, pollutants, effluents, contaminants, radioactive materials, flammable explosives,
chemicals known to cause cancer or reproductive toxicity, emissions or wastes and any other
chemical, material or substance, the handling, storage, release, transportation, or disposal of
which is or becomes prohibited, limited or regulated by any federal, state, county, regional or
local authority or which, even if not so regulated, is or becomes known to pose a hazard to the
health and safety of the occupants of the Property including, without limitation, (i) asbestos, (ii)
petroleum and petroleum by-products, (iii) urea formaldehyde foam insulation,' (iv)
polychlorinated biphenyls, (v) all substances now or hereafter designated as "hazardous
substances:' "hazardous materials" or "toxic substances" pursuant to the Comprehensive
~828-2720-O5]2.2
12,6104
7
Environmental Response, Compensation and Liability Act of 1980 ("CERCLA"), 42 U.S.c.
Section 9601 et seq., as amended by the Superfund Amendments and Reauthorization Act of
1986 ("SARA"), the Federal Water Pollution Control Act, 33 U.S.c. Section 1251 et seq. the
Clean Air Act, 42 U.S.c. Section 7401 et seq., the Hazardous Materials Transportation Act, 49
U.S.c. Section 1801 et seq., or the Resource, Conservation and Recovery Act, 42 US.C. Section
6901 et seq.; (vi) all substances now or hereafter designated as "hazardous wastes" in Section
25117 of the California Health & Safety Code or as "hazardous substances" in Section 253 16 of
the California Health & Safety Code; (vii) all substances now or hereafter designated by the
Governor of the State of California pursuant to the Safe Drinking Water and Toxic Enforcement
Act of 1986 as being known to cause cancer or reproductive toxicity, or (viii) all substances now
or hereafter designated as "hazardous substances," "hazardous materials" or "toxic substances"
under any other federal, state or local laws or in any regulations adopted and publications
promulgated pursuant to said laws.
"Environmental Laws" as used herein shall mean all laws, rules, regulations and
ordinances relating to Hazardous Materials, including, but not limited to, those relating to soil
and groundwater conditions and those statutes referred to in the definition of Hazardous
Materials set forth hereinabove.
"Environmental Activities" as used herein shall mean the use, generation.
transportation, treatment, storage or disposal of any Hazardous Materials at any time located on
or present on, under or about the Property.
(f) Trustor hereby agrees, at its sole cost and expense, to indemnify, protect,
hold harmless and defend (with counsel subject to Beneficiary's reasonable approval).
Beneficiary, its successors and assignees, and the officials, officers, agents, attorneys and
employees of each of them (individually, each an "Indemnitee". and collectively. the
"Indemnitees") from and against any and all claims, demands, damages, losses, liabilities,
obligations, penalties, fines, actions, causes of action, judgments, suits, proceedings, costs,
disbursements and expenses (including, without limitation, attorneys' and experts' reasonable
fees, disbursements and costs) of any kind or of any nature whatsoever (collectively, "Claims")
which may at any time be imposed upon, incurred or suffered by, or asserted or awarded against,
any Indemnitee directly or indirectly relating to or arising from any of the following
"Environmental Matters". but excluding any Claims arising solely from the gross negligence or
willful misconduct of Beneficiary:
(i) Any future presence of any Hazardous Materials on, in, under or
affecting all or any portion of the Property or on, in, under or affecting all or any portion
of any property adjacent or proximate to the Property, if such Hazardous Materials
originated or allegedly originated on or from the Property;
(ii) Any future storage, holding, handling, release, threatened release,
discharge, generation, leak, abatement, removal or transportation of any Hazardous
Materials on, in, under or from the Property or any portion thereof,
4828-2720-0512.2
12,'6104
8
(iii) The failure of Trustor to comply with any and all laws, rules,
regulations, judgments, orders, permits, licenses, agreements, covenants, restrictions,
requirements or the like now or hereafter relating to or governing in any way the
environmental condition of the Property or the presence of Hazardous Materials on, in,
under or affecting all or any portion of the Property including, without limitation, all
Environmental Laws;
(iv) The failure of Trustor to properly complete, obtain, submit and/or
file any and all notices, permits, licenses, authorizations, covenants, and the like relative
to any of the Environmental Matters described herein in connection with the Property or
the ownership, use, operation or enjoyment thereof,
(v) The extraction, removal, containment, transportation or disposal
of any and all Hazardous Materials from any portion of the Property or any other
property adjacent or proximate to the Property, if such Hazardous Materials originated or
allegedly originated on or from the Property;
(vi) Any future presence, permitting, operation, closure, abandonment
or removal from the Property of any storage tank that at any time contains or contained
any Hazardous Materials and is or was located on, in or under the Property or any portion
thereof;
(vii) The implementation and enforcement of any monitoring,
notification or other precautionary measures that may at any time become necessary to
protect against the release or discharge of Hazardous Materials on, in, under or affecting
the Property or into the air, any body of water, any other public domain or any property
adjacent or proximate to the Property;
(viii) Any failure of any Hazardous Materials generated or moved from
the Property to be removed, contained, transported or disposed of in compliance with all
applicable Environmental Laws; or
(ix) Any breach by Trustor of any of its covenants, representations or
warranties regarding Environmental Matters contained in this Deed of Trust or any of the
other Transaction Documents.
(g) Whenever the term "Trustor's ActUal Knowledge" is used in this Section
9(g), it shall mean the actual personal knowledge of
and no other, based upon the inspection described below in Section 9(g)(v). Trustor hereby
represents and warrants as follows:
(i) To Trustor's Actual Knowledge the Property is not and has not
been a site for the use, generation, manufacture, storage, treatment, release, threatened
release, discharge, disposal or transportation of any Hazardous Materials;
..828-2720..0512.2
126,04
9
(ii) To Trustor's Actual Knowledge, the Property IS In compliance
with all Environmental Laws;
(iii) Trustor has not received any written notice of claims or actions
(collectively, "Hazardous Materials Claims") pending or threatened against Trustor or
any previous owner or user of the Property (and relating to Trustor's and/or such previous
o\vner's or user's o\\nership of the Property), by any governmental entity or agency or
any other person or entity and relating to Hazardous Materials or pursuant to
Environmental Laws; and
(iv) Trustor has not received any written notice (i) pursuant to which
the Property has been designated as "border zone property" under the provisions of
California Health and Safety Code Sections 25220 et seq., or any other regulation
adopted in accordance therewith, (ii) of a hearing at which the Property will be
considered for designation as "border zone property", or (iii) of an occurrence or
condition on any real property adjoining or in the vicinity of the Property that could cause
the Property or any part thereof to be designated as "border zone property": and
(v) Trustor has performed a due and diligent inspection of the
Property relative to the existence of Hazardous Materials and that to Trustor's Actual
Knowledge based upon such due and diligent inspection no Hazardous Materials exist on
the Property.
The foregoing shall constitute environmental proVISIOns for purposes of
California Code of Civil Procedure Section 736.
10. Insurance.
(a) Casualty Insurance. Trustor shall at all times keep the Property insured
for the benefit of Trustee and Beneficiary as follows, despite governmental requirements that
may detrimentally affect Trustor's ability to obtain or may materially increase the cost of such
Insurance coverage:
(i) Against damage or loss by fire and such other hazards (including
lightning, windstorm, hail, explosion, riot, acts of striking employees, civil commotion,
vandalism, malicious mischief, aircraft, vehicle, and smoke) as are covered by the
broadest form of extended coverage endorsement available from time to time, in an
amount not less than the full insurable value (as defined in section 10.9) of the Property,
with a deductible amount not to exceed an amount satisfactory to Beneficiary;
(ii) Against rent, business, use or occupancy interruption on such
basis and in such amounts and with such deductibles as are reasonably satisfactory to
Beneficiary;
(iii) Against damage or loss by flood, if the Property is located in an
area identified by the Secretary of Housing and Urban Development or any successor or
-l828-2720-0512.2
12.60..
10
other appropriate authority (governmental or private) as an area having special flood
hazards and in which flood insurance is available under the National Flood Insurance Act
of 1968 or the Flood Disaster Protection Act of 1973. as amended. modified.
supplemented, or replaced from time to time, on such basis and in such amounts as
Beneficiary may require;
(iv) Against damage or loss from (a) sprinkler system leakage and (b)
boilers, boiler tanks, heating and air conditioning equipment, pressure vessels, auxiliary
piping, and similar apparatus, on such basis and in such amounts as Beneficiary may
reqUIre;
(v) During any alteration, construction, or replacement of
improvements on the Property, or any substantial portion thereof, a Builder's All Risk
policy with extended coverage with course of construction and completed value
endorsements, for an amount at least equal to the full insurable value of the
improvements on the Property, and workers' compensation. in reasonable statutory
amounts, with provision for replacement with the coverage described in Section 4.1,
without gaps or lapsed coverage, for any completed portion of improvements on the
Property; and
(vi) Against damage or loss by earthquake, with a deductible
reasonably satisfactory to Beneficiary, if such insurance is required by the senior deed of
trust beneficiary and provided it is available at commercially reasonable rates.
(b) Liability Insurance. Trustor shall procure and maintain workers'
compensation insurance for Trustor's employees and comprehensive general liability insurance
covering Trustor, Trustee, and Beneficiary against claims for bodily injury or death or for
damage occurring in, on, about, or resulting from the Property, or any street, drive, sidewalk,
curb, or passageway adjacent to it, in standard form and with such insurance company or
companies and in an amount of at least S 1 ,000,000 per claim, 52.000,000 aggregate single limit,
or such greater amount, as senior lender may require or is available at commercially reasonable
rates, which insurance shall include completed operations, product liability, and blanket
contractual liability coverage that insures contractual liability under the indemnifications set
forth in this Deed of Trust and the Transaction Documents (but such coverage or its amount shall
in no way limit such indemnification).
(c) Other Insurance. Trustor shall procure and maintain such other insurance
or such additional amounts of insurance, covering Trustor and the Property, as (a) may be
required by the terms of any construction contract for any improvements on the Property or by
any governmental authority, other than Beneficiary, or (b) may be specified in any other
Transaction Documents.
(d) Form of Policies. All insurance required under this Section 10 shall be
fully paid for and nonassessable. The policies shall contain such provisions, endorsements, and
expiration dates as Beneficiary from time to time reasonably requests and shall be in such form
and. amounts, and be issued by such insurance companies doing business in the State of
4X:!X.27::::U-05122
!2 6 ()~
11
California, as Beneficiary shall approve in Beneficiary's reasonable discretion. All policies shall
(a) contain a waiver of subrogation endorsement; (b) provide that the policy will not lapse or be
canceled, amended, or materially altered (including by reduction in the scope or limits of
coverage) without at least 30 days' prior written notice to Beneficiary; (c) with the exception of
the comprehensive general liability policy, contain a mortgagee's endorsement (438 BFU
Endorsement or equivalent), and name Beneficiary and Trustee as insureds; and (d) include such
deductibles as Beneficiary may approve. If a policy required under this paragraph contains a co-
insurance or overage clause, the policy shall include a stipulated value or agreed amount
endorsement acceptable to Beneficiary.
(e) Duplicate Originals or Certificates. Duplicate original policies evidencing
the insurance required under this Section 10 and any additional insurance that may be purchased
on the Property by or on behalf of Trustor shall be deposited with and held by Beneficiary and,
in addition, Trustor shall deliver to Beneficiary (a) receipts evidencing payment of all premiums
on the policies and (b) duplicate original renewal policies or a binder with evidence reasonably
satisfactory to Beneficiary of payment of all premiums at least 30 days before the policy expires.
In lieu of the duplicate original policies to be delivered to Beneficiary under this Section 10.5,
Trustor may deliver an underlier of any blanket policy, and Trustor may also deliver original
certificates from the issuing insurance company, evidencing that such policies are in full force
and effect and containing information that, in Beneficiary's reasonable judgment, is sufficient to
allow Beneficiary to ascertain whether such policies comply with the requirements of this
Section 10.
(f) No Separate Insurance. Trustor shall not carry separate or additional
insurance concurrent in form or contributing in the event of loss with that required under this
Section 10, unless endorsed in favor of Trustee and Beneficiary, as required by this Section 10
and otherwise approved by Beneficiary in all respects.
(g) Transfer of Title. In the event of foreclosure of this Deed of Trust or other
transfer of title or assignment of the Property in extinguishment, in whole or in part, of the Loan,
all right, title, and interest of Trustor in and to all insurance policies required under this Section
10 or otherwise then in force with respect to the Property and all proceeds payable under, and
unearned premiums on, such policies shall immediately vest in the purchaser or other transferee
of the Property.
(h) Replacement. Cost. For purposes of this Section 10, the term "full
insurable value" means the actual cost of replacing the Property in question, without allowing for'
depreciation, as calculated from time to time (but not more often than once every calendar year)
by the insurance company or companies holding such insurance or, at Beneficiary's request, by
appraisal made by an appraiser, engineer, architect, or contractor proposed by Trustor and
approved by said insurance company or companies and Beneficiary. Trustor shall pay the cost of
such appraisal.
(i) Approval Not Warranty. No approval by Beneficiary of any insurer may
be construed to be a representation, certification, or warranty of its solvency and no approval by
4828-2720-05122
:2,604
12
Beneficiary as to the amount, type, or form of any insurance may be construed to be a
representation, certification, or warranty of its sufficiency.
(j) Beneficiary's Right To Obtain. Trustor shall deliver to Beneficiary
original policies or certificates evidencing such insurance at least 30 days before the existing
policies expire. If any such policy is not so delivered to Beneficiary or if any such policy is
canceled, whether or not Beneficiary has the policy in its possession, and no reinstatement or
replacement policy is received before termination of insurance, Beneficiary, without notice to or
demand on Trustor, may (but is not obligated to) obtain such insurance insuring only Beneficiary
and Trustee with such company as Beneficiary may reasonably deem satisfactory, and pay the
premium for such policies, and the amount of any premium so paid shall be charged to and
promptly paid by Trustor or. at Beneficiary's option, may be added to the Loan. Trustor
acknowledges that, if Beneficiary obtains insurance, it is for the sole benefit of Beneficiary and
Trustee, and Trustor shall not rely on any insurance obtained by Beneficiary to protect Trustor in
any way.
(k) Dutv To Restore After Casualty. If any act or occurrence of any kind or
nature (including any casualty for which insurance was not obtained or obtainable) results in
damage to or loss or destruction of the Property, Trustor shall immediately give notice of such
loss or damage to Beneficiary and, if Beneficiary so instructs, shall promptly, at Trustor's sole
cost and expense, provided (a) any senior deed of trust beneficiary makes insurance proceeds
available and (b) all such insurance proceeds will be sufficient for the purpose, commence and
continue diligently to completion to restore, repair, replace, and rebuild the Property as nearly as
possible to its value, condition, and character immediately before the damage, loss or
destruction.
11. Assignment of Insurance and Condemnation Proceeds. Subject to the rights of
any senior deed of trust beneficiary should the Property or any part or appurtenance thereof or
right or interest therein be taken or damaged by reason of any public or private improvement,
condemnation proceeding (including change of grade), fire, earthquake or other casualty, or in
any other manner, Beneficiary or Trustee may, at its option, commence, appear in and prosecute,
in its own name, any action or proceeding, or make any reasonable compromise or settlement in
connection with such taking or damage, and obtain all compensation, awards or other relief
therefor. All compensation, awards, damages, rights of action and proceeds, including the
policies and the proceeds of any policies of insurance affecting the Property, are hereby assigned
to Beneficiary, subject to the rights of any senior deed of trust beneficiary, but no such
assignments shall be effective to invalidate or impair any insurance policy. Trustor further
assigns to Beneficiary any return premiums or other repayments upon any insurance at any time
provided for the benefit of the Beneficiary and all refunds or rebates made of taxes or
assessments on the Property, and Beneficiary may at any time collect said return premiums,
repayments, refunds and rebates in the event of any default by Trustor under the DDA, the Note
or, this Deed of Trust or any other Transaction Documents. Insurance proceeds or condemnation
awards at any time assigned to or held by Beneficiary shall be deemed to be held in trust and
Beneficiary shall not commingle such proceeds with its general assets. Trustor also agrees to
execute such further assignments of any such policies, compensation, award, damages, rebates,
~828-2720'{)512.2
12.6/04
13
return of premiums, repayments, rights of action and proceeds as Beneficiary or Trustee may
reqUire.
12. Use of Insurance Proceeds. After any damage by casualty to the Property,
whether or not required to be insured against under the policies to be provided by Trustor,
Trustor shall give prompt written notice thereof to Beneficiary generally describing the nature
and cause of such casualty and the extent of the damage to or destruction of the Property.
Trustor shall have the obligation to promptly repair the damage, provided (a) any senior deed of
trust beneficiary makes insurance proceeds available and (b) all such insurance proceeds will be
sufficient for the purpose. For these purposes, Beneficiary shall make available to Trustor
proceeds of any insurance policy covering the casualty and maintained by Trustor under and
subject to each of the following terms and conditions:
(a)
the "Proceeds") shall
following conditions:
Insurance proceeds which are directly attributable to the damage (herein
be released to Trustor upon and subject to satisfaction of each of the
(i) There exists no default under the DDA, this Deed of Trust or any other
Transaction Documents at any time prior to or during the course of reconstruction;
(ii) Receipt by Beneficiary of satisfactory written evidence that any proposed
restorations by Trustor will comply with all statutes, ordinances, regulations, rules,
rulings, restrictive covenants, reciprocal easements, leases and contracts: that all
proposed plans and specifications are approved by all required governmental agencies;
and that Trustor has obtained all necessary building and other permits and approvals for
such reconstruction;
(iii) Receipt by Beneficiary of proof reasonably satisfactory to Beneficiary that
there exists and will continue to exist, until the Property is reasonably expected to be
restored and fully occupied, a source of funds sufficient to construct and install the
Project (as defined in the Transaction Documents) or, alternatively, to pay the Loan as
and when due. Such computation shall include Beneficiary's estimate of the amount
necessary to pay all of Trustor's operating expenses and construct and install all of the
Project improvements (as defined in the Transaction Documents) and pay all of the sums
due on the Note over the projected period of reconstruction, and Beneficiary may require
Trustor to establish and fund a holdback account up to the amount of the difference
between the anticipated debt service and operating expenses of Trustor. In the event of
any default under the DDA, this Deed of Trust, any other Transaction Documents or any
reconstruction requirements, Beneficiary may, at its option, apply any portion or all of
such amounts against accrued interest and the outstanding amounts due under the DDA
or the Note;
(iv) Receipt by Beneficiary from Trustor of evidence of sufficient cash funds
to cover one hundred percent (100%) of any difference between the estimated costs of
;;amnierion, as certified by an architect or engineer reasonably approved by Beneficiary
in writing, and the Proceeds;
~828-2720-D512.2
12.6,O~
14
(v) Receipt by Beneficiary of a certificate executed by Trustor describing the
work to be performed in connection with such restoration and a certificate by an
independent architect or engineer selected or approved by Beneficiary in writing stating
that the work described in the Trustor's certificate is adequate to restore the Property to
substantially the same size, design, quality and condition as existed prior to the damage.
The architect's or engineer's certificate shall include its estimate of all costs and expenses
which will be required to complete such restorations; and
(vi) Such additional conditions as may reasonably be imposed by Beneficiary
to provide assurance that the Proceeds will be used to restore the Property to substantially
the same condition, to the extent possible, as existed prior to the damage or taking,
including, without limitation, Beneficiary's prior 'WTitten approval of all permits, plans.
specifications and construction contracts for such restoration.
(c) After completion of the restoration and subject to the conditions herein
stated, and, if Trustor is not then in default under the DDA, this Deed of Trust or any other
Transaction Documents, Beneficiary shall pay to Trustor (or such other persons or entities that
may have an interest therein) the undisbursed Proceeds and Trustor's deposit for any estimated
restoration expense held by Beneficiary upon delivery to Beneficiary of (i) a certificate executed
by Trustor showing that the work has been completed and that all bills for labor performed and
materials furnished in connection therewith have been paid, (ii) unconditional lien releases and
other appropriate written acknowledgments of payment in full executed by all contractors and
subcontractors performing labor on or furnishing materials to the Property; (iii) a certificate
executed by an architect or engineer reasonably approved by Beneficiary confirming that the
Property has been restored to substantially the same size, design, quality and condition as existed
immediately prior to the damage and in accordance with all applicable federal, state, local and
other governmental laws and regulations; and (iv) a certificate of occupancy and other permits
issued by the appropriate governmental authorities authorizing the occupancy of the Property for
its intended purposes and use.
If (i) any of the conditions in subparagraph 12(b), above, are not fulfilled within
sixty (60) days after the date of the casualty, or if the reconstruction cannot be completed within
such 60 day period, within such additional time as may be reasonably necessary to complete the
reconstruction, not to exceed one hundred eighty (180) days, and provided such additional time
does not result in a breach by the Trustor under the DDA, this Deed of Trust or any other
Transaction Documents; or (ii) if Trustor fails to exercise diligence in promptly commencing or
continuously prosecuting the work; or (iii) if Trustor is otherwise in default under the DDA, the
Note, this Deed of Trust, other Transaction Documents or any reconstruction requirements set
forth therein or herein, Beneficiary may, at its option, subject to the rights of all senior deed of
trust beneficiaries, receive and apply the Proceeds and any deposits made by Trustor hereunder
to the indebtedness secured hereby, or to complete the necessary repairs and use the Proceeds for
the payment thereof. If the Proceeds are so applied to the indebtedness and, together with any
other payments due to Beneficiary under the DDA and all other debts of Trustor to Beneficiary
are discharged, Beneficiary shall not have the right to require the Property to be repaired under
the terms of this Deed of Trust, but Beneficiary's rights under any other lien that it holds against
4H28-2'720-<J5122
12.6'0';
15
the Property and which is not also required to be released shall not be thereby impaired or
affected.
All work of repamng or restoring damage shall be done in a good and
workmanlike manner with materials of good quality and in conformity with all applicable laws,
ordinances, rules and regulations. Nothing herein contained shall be construed as authorizing the
Trustor to subject the Property to any mechanic's, materialman's or other lien for the payment of
bills for material furnished or labor performed in connection with any work contemplated by this
paragraph.
In any event in which the Beneficiary is not otherwise obligated to permit the
insurance proceeds to be applied to the restoration of the Property as hereinabove described and,
at the option of Beneficiary, the proceeds of a loss under any policy, whether or not endorsed
payable to Beneficiary, may be subject to the rights of all senior deed of trust beneficiaries,
receive and applied in payment of the principal, interest or any other sums secured by this Deed
of Trust, whether or not then due, or to the restoration or replacement of any building on the
Property, without in any way affecting the enforceability or priority of the lien of this Deed of
Trust or the obligation of the Trustor or any other person for payment of the indebtedness hereby
secured or the reconstruction of the damaged improvements, whether such Trustor be the then
owner of said building or improvements or not.
13. Use of Condemnation Awards. Should the Property or any portion thereof or any
improvements thereon be taken or damaged by reason of any public improvement or
condemnation proceeding, or by any other form of eminent domain, Trustor agrees that
Beneficiary shall be entitled, subject to the provisions of Section 1265.225 of the California
Code of Civil Procedure, to all compensation, awards and other payments or relief therefor and
may, at its option, commence, appear in or prosecute in its own name any action or proceeding or
make any reasonable compromise or settlement in connection with such taking or damage, and
Trustor agrees to pay Beneficiary's costs and reasonable attorneys' fees incurred in connection
therewith. All such compensation, awards, damages, rights of actions and proceeds may be
applied by Beneficiary toward the repair of any damage to the improvements on any portion of
the Property not subject to the taking as and subject to the same conditions herein provided with
respect to the disposition of insurance proceeds; provided, however, that if the taking results in a
loss of the Property to an extent which, in the reasonable opinion of Beneficiary, renders or will
render the Property not economically viable or which substantially impairs Beneficiary's security
or lessens to any extent the value, marketability or intended use of the Property, Beneficiary may
apply the condemnation proceeds to reduce the unpaid indebtedness secured hereby in such order
as Beneficiary may determine. Trustor agrees to execute such further assignments of
condemnation proceeds as Beneficiary or Trustee may from time to time reasonably require. If
so applied. any proceeds in excess of the unpaid principal and accrued interest due under or
DDA or the Note plus all other sums due to Beneficiary from Trustor shall be paid to Trustor or
Trustor's assignee.
14. Propertv Taxes and Assessments. Trustor shall pay in full on or before the due
date thereof all rents, taxes, assessments and encumbrances, WIth interest, that may now or
hereafter be levied, assessed or claimed upon the Trustor's ownership or use of the Property that
~8.28-17:0-O512_~
12604
16
is the subject of this Deed of Trust or any part thereof, and upon request, provide the Beneficiary
with copies of official receipts for payment therefor, and shall pay all taxes imposed upon, and
reasonable costs, fees and expenses of, this Deed of Trust.
15. Assessment Districts. Trustor agrees not to consent to inclusion of the Land in
any local improvement or special assessment district or to the imposition of any special or local
improvement assessment against the Property. without Beneficiary's prior \VTitten consent.
16. Mortgage Taxes. In the event of the passage after the date of this Deed of Trust
of any federal. state or municipal law, ordinance or regulation relating to the taxation of
mortgages, deeds of trust or debts secured thereby so as to tax or assess any interest of
Beneficiary or any payments secured hereby. Trustor shall bear and pay the full amount of such
taxes.
17. Special Assessment and Insurance Reserves. Subject to the rights of any senior
deed of trust beneficiary approved by the Beneficiary, Trustor shall, at the request of the
Beneficiary, pay to Beneficiary equal monthly installments of the special assessments and
insurance premiums estimated by the Beneficiary next to become due, in addition to any other
periodic payment or performances owed by Trustor under the DDA or any other Transaction
Documents or this Deed of Trust, so that thirty (30) days before the due date thereof, or of the
first installment thereof, Beneficiary will have on hand an amount sufficient to pay the next
maturing assessments and insurance premiums. The amount of the additional payment to be
made on account of assessments and insurance premiums shall be adjusted annually or more
frequently as Beneficiary deems necessary and any deficit shall be immediately paid by Trustor
upon request and any surplus shall be credited on the mortgage account. Subsequent payments
on account of assessments and insurance premiums shall be made in accordance with the next
estimate by the Beneficiary of annual requirements. To the extent permitted by applicable law,
all monies paid to Beneficiary on account of assessments or insurance premiums may be
commingled and invested with Beneficiary's ov.n funds and, unless and to the extent required by
law. shall not bear interest for Trustor. Beneficiary shall not exercise the rights granted in this
paragraph so long as all of the following conditions are met:
(a) There is no default under the DDA, the Note, this Deed of Trust or any
other Transaction Documents; and
(b) Trustor pays all assessments and insurance premiums prior to delinquency.
Upon Trustor's failure to comply with either of conditions (a) or (b). above.
Beneficiary may, at its option, then or thereafter exercised, require Trustor to pay the additional
sums described in this paragraph.
18. Trustor's Right to Contest Taxes. Trustor shall have the right to contest any real
property tax or special assessment so long as (a) no defaults exist under the DDA. this Deed of
Trust or any other Transaction Documents; (b) Trustor makes any payment or deposit or posts
any bond as and when required as a condition to pursuing such contest; (c) Trustor commences
such contest prior to such tax or assessment becoming delinquent and continuously pursues the
~R28-2720"()512,2
12 b 1).1
17
same in good faith and with due diligence; (d) such contest or any bond furnished by Trustor
stays the foreclosure of any lien securing the payment of any such tax or assessment; and (e)
Trustor pays any tax or assessment within ten (10) days following the date of resolution of such
contest.
19. Report of Real Estate Transaction. Trustor has made or provided for making, or
will make or provide for making, on a timely basis, any reports or returns required by state or
local law relating to the Property, or the development of the Property, notwithstanding the fact
that the primary reporting responsibility may fall on the Beneficiary, or other party. Trustor's
obligations under this paragraph will be deemed to be satisfied, if proper and timely reports and
. returns required under this paragraph are filed by a title company involved in each real estate
transaction relating to the Property, but nothing contained herein shall be construed to require
such returns or reports to be filed by Beneficiary.
20. Leases. With respect to any leases currently or hereafter relating to any portion of
the Property, Trustor agrees that:
(a) Prior to the execution of any such lease or rental agreement by the Trustor.
the Trustor shall give the Beneficiary thirty (30) days written notice setting forth the identity of
the tenant and the relevant terms of the proposed lease;
(b) Each such lease shall not be inconsistent with the covenants of the Trustor
under the DDA, this Deed of Trust and the other Transaction Documents;
(c) Trustor shall fully comply with all of its material obligations under all
leases on the Property, so that the same shall not become in default and shall do all that is
necessary to preserve the same in force; and
(d) Beneficiary and its successors and assigns (including any purchaser at a
foreclosure or trustee's sale) shall have the right. at its option, to recognize and continue in effect
any such leasehold interests following any foreclosure or trustee's sale hereunder.
21. Assignment of Leases. Trustor hereby unconditionally and absolutely assigns,
transfers and sets over unto Beneficiary, all leases, subleases, rental agreements. occupancy
agreements. licenses, concessions, entry fees and other agreements that grant a possessory
interest or right of entry in all or any part of the Property, together with all rents, issues, deposits
and profits of the Property, together with the immediate and continuing right to collect and
receive the same, for the purpose and upon the terms and conditions hereinafter set forth.
Trustor further unconditionally and absolutely assigns, transfers and sets over unto Beneficiary
all of its right, title and interest in and to any plans, drawings, specifications, permits.
engineering reports and land planning maps, which it now has or may hereafter acquire regarding
any improvements now on or to be constructed upon the Property. Beneficiary confers upon
Trustor a license to collect and retain the rents, issues, deposits and profits of the Property, as
they become due and payable, subject, however, to the right of Beneficiary upon a default
hereunder to revoke said license, at any time, in its sole discretion and without notice to Trustor.
Beneficiary may revoke said license and collect and retain the rents, issues, deposits and profits
4828-2720-0512.2
12004
18
of the Property assigned herein to Beneficiary upon the occurrence of an Event of Default
hereunder or Trustor's default under any of the obligations secured hereby, and without taking
possession of all or any part of the Property, and without prejudice to or limitation upon any of
its additional rights and remedies granted pursuant hereto or pursuant to the DDA or any other
Transaction Documents, and Beneficiary shall, in its sole and absolute discretion, have the right
to apply such income for the payment of all expenses or credit the net amount of income that it
receives from the Property, to the indebtedness in the manner, order and amounts as Beneficiary
shall determine. In the event the Beneficiary exercises or is entitled to exercise any of its rights
or remedies under this Deed of Trust as a result of the default of the Trustor under the DDA, and
if any lessee, sublessee or assignee under any lease assigned under this paragraph files or has
filed against it any petition in bankruptcy or for reorganization or undertakes or is subject to
similar action, Beneficiary shall have, and is hereby assigned by Trustor, all of the rights that
would otherwise inure to the benefit of Trustor in such proceedings, including, without
limitation, the right to seek "adequate protection" of its interests, to compel assumption or
rejection of any such lease and to seek such claims and awards as may be sought or granted in
connection with the rejection of any such lease. Unless otherwise agreed to by Beneficiary in
writing, Beneficiary's exercise of any of the rights provided in this paragraph shall preclude
Trustor from the pursuit and benefit thereof, without any further action or proceeding of any
nature. The foregoing assignment shall not impose upon Beneficiary any duty to produce rents
from the Property, and such assignment shall not cause Beneficiary to be a "mortgagee in
possession" for any purpose. The rights granted in this paragraph shall be in addition to and not
in derogation of any similar or related rights granted to Beneficiary in any separate assignment of
leases and rents.
22. Impairment of Security. Trustor shall not, without first obtaining Beneficiary's
written consent, assign any of the rents or profits of the Property or change the general nature or
use of the Property or initiate or acquiesce in any zoning reclassification, or do, or suffer to be
done. any act or thing that would impair the security of Beneficiary's lien upon the Property or
the rents thereof. Trustor shall not, without the written consent of Beneficiary, (i) initiate or
support any zoning reclassification of the Property, seek any variance under existing zoning
ordinances applicable to the Property or use or permit the use of the Property in a manner that
would result iri such use becoming a non-conforming use under applicable zoning ordinances;
(ii) modify, amend or supplement any easement, reservation, restriction, covenant, condition or
encumbrance pertaining to the Property; (iii) impose or consent to any restrictive covenant or
encumbrance upon the Property, execute or file any subdivision or parcel map affecting the
Property or consent to the annexation of the Property to any municipality; or (iv) permit or suffer
the Property to be used by the public or any person in such manner as might make possible a
claim of any implied dedication or easement.
23. Defense of Suits. Trustor shall appear in and defend any suit, action or
proceeding that might affect the value, priority or enforceability of this Deed of Trust or the
Property itself or the rights or powers of Beneficiary or Trustee, including any suits relating to
damage to property or death or personal injuries, whether or not Trustor is ultimately found
liable for any negligence or other wrongful conduct or inaction. Trustor, following mutual
negotiations with Beneficiary, has waived and does hereby waive any immunity to such liability
to Beneficiary under any industrial insurance or similar statute, to the extent such immunity
~828-2720-O5122
1216/04
19
would impair Beneficiary's rights against Trustor. Should Beneficiary elect to appear in or
defend any such action or proceeding or be made a party to any such action or proceeding by
reason of this Deed of Trust, or elect to prosecute such action as appears necessary to preserve
the value, priority or enforceability of this Deed of Trust or the Property itself, Trustor will at all
times indemnify Beneficiary and Trustee from and, on demand, reimburse Beneficiary and
Trustee for, any and all loss, damage, expense or cost, including cost of evidence of title, expert
witness fees and attorneys' fees, arising out of or incurred in connection with any such suit,
action or proceeding, and any appeal or petition for review thereof, and the sum of such
expenditures shall be secured by this Deed of Trust with interest at the rate of 10% per annum
and shall be due and payable on demand. Trustor shall pay costs of suit, cost of evidence of title,
expert witness fees and reasonable attorneys' fees in any proceeding or suit brought by
Beneficiary to foreclose this Deed of Trust and in any appeal therefrom or petition for review
thereof.
24. Assignments and Transfers. Trustor acknowledges that Beneficiary relied upon
Trustor's financial statements, credit history. business and real property managerial expertise and
other factors personal to Trustor in making the Loan, and Trustor covenants not to transfer any of
the interest in the Property or to permit the transfer of any interest in Trustor without first
receiving Beneficiary's express written consent in each instance. A breach of this covenant shall
constitute a default under the DDA, the Note and this Deed of Trust. All sums then due to
Beneficiary by Trustor hereunder, under the DDA or under the Note may, at Beneficiary's
option. be declared immediately due and payable if any of Trustor's interests in the Property, or
any part thereof, are sold or transferred, voluntarily or involuntarily, without Beneficiary's prior
written consent.
25. Matters Requiring Beneficiary's Prior Consent. So long as any part of the Loan
remains unpaid or any part of the Obligations remain unperformed, Trustor shall not do or suffer
any of the following without Beneficiary's prior written consent, which consent shall not be
unreasonably withheld: (i) change its form of organization; (ii) modify its organizational
documents; (iii) cause itself to become organized as the same or any other type of legal entity in
a jurisdiction other than that under the laws of which it is organized on the date of this Deed of
Trust; (iv) merge with or into, consolidate with, or become subject to control by any other legal
entity; (v) except as permitted pursuant to Section 24, make or suffer any change in its ownership
or management, or become subject to control by persons other than its owners on the date of this
Deed of Trust, voluntarily or by operation of law; (vi) except as permitted pursuant to Section
27, sell, convey, assign, or transfer any Property or any interest therein, whether legal or
equitable, directly or indirectly; (vii) create, incur, assume, suffer to exist, or otherwise become
liable on any indebtedness relating to the Property other than (1) a Senior Loan (as defined in
Section 42); (2) the Loan; and, (3) ordinary course trade payables incurred in connection with the
ownership and operation of the Property, none of which shall exceed an amount reasonable and
customary for such an expenditure for properties similar in type, size, and character to the
Property located in the area of the Property; or (viii) grant or suffer the imposition of any lien
upon, security interest in, or other encumbrance of any of the Property. Any violation of the
provisions of this Section 25 shall constitute an Event of Default under this Deed of Trust and
each other Transaction Document, with respect to which Beneficiary shall have the right to
~828-2nO-<J512.2
i2;610~
20
accelerate the maturity of the Loan and pursue all other remedies available to Beneficiary under
this Deed of Trust, any other Transaction Document, and/or applicable law.
26. Further Encumbrances. Trustor acknowledges that Beneficiary relied upon the
Property not being subject to additional liens or encumbrances for reasons including, but not
limited to, the possibility of competing claims or the promotion of plans disadvantageous to
Beneficiary in bankruptcy: the risks to Beneficiary in a junior lienholder's bankruptcy; questions
involving the priority of future advances, the priority of future leases of the Property, the
marshaling of Trustor's assets, and the Beneficiary's rights to determine the application of
condemnation awards and insurance proceeds: the impairment of the Beneficiary's option to
accept a deed in lieu of foreclosure; the increased difficulty of reaching agreements for workouts
or to the actions to be taken by trustees, receivers, liquidators and fiduciaries; and Beneficiary's
requirements of Trustor's preservation of its equity in the Property and the absence of debt that
could increase the likelihood of Trustor being unable to perform its obligations when due.
Therefore, as a principal inducement to Beneficiary to make the Loan secured by this Deed of
Trust, and with the knowledge that Beneficiary will materially rely upon this paragraph in so
doing, Trustor covenants not to encumber the Property, without first receiving Beneficiary's
express written consent in each instance, which consent may be withheld by Beneficiary. A
breach of this covenant shall constitute a default under the DDA, the Note and this Deed of
Trust, and Beneficiary may exercise all remedies available to Beneficiary under the DDA, the
Note or this Deed of Trust. Without limiting the generality of the foregoing, no mortgages,
deeds of trust or other forms of security interests prior or subordinate to the security interests of
Beneficiary shall encumber any real or personal property that is the subject of any lien or
security interest granted to Beneficiary, without Beneficiary's prior written consent.
27. Subordination. Beneficiary hereby agrees to subordinate this Deed of Trust to a
Senior Lender, as defined herein below, in accordance with the provisions for subordination set
forth in the DDA.
a. Senior Lender. A "Senior Lender" is a lender who intends to loan money
to the Trustor and secure such loan by recording a deed of trust against the Property after the
recordation of this Deed of Trust and who is a construction lender (as this term is described in
the DDA) for the Project.
b. Junior Lender. Trustor acknowledges and agrees that Beneficiary shall
have no obligation to subordinate this Deed of Trust to a Senior Lender unless and until
Beneficiary is reasonably satisfied that it shall have the Same rights and remedies as set forth in
the DDA and such rights shall be recognized in a mutually agreed upon subordination agreement
entered into by Beneficiary and any such Senior Lender.
28. Event of Default. An "Event of Default" shall be deemed to have occurred in any
of the following circumstances:
(a) Failure of Trustor to satisfy any performance or payment obligation
required under this Deed of Trust, the DDA or any other Transaction Document within thirty
(30) days following written notice from Beneficiary;
~828-2720-O5122
126,04
21
(b) Failure of Trustor to properly perform its obligations under this Deed of
Trust. the DDA or any other Transaction Document, by a date specified herein or therein or in a
written notice to Trustor, if applicable, within thirty (30) days following written notice from
Beneficiary;
(c) The occurrence of a casualty that is uninsured as a result of Trustor's
failure to maintain insurance required hereunder with respect to, any material (as determined by
Beneficiary) portion of the Property;
(d) Trustor becomes insolvent or generally is not paying its debts as they
become due, as defined in the United States Bankruptcy Reform Act, as amended from time to
time (which Act. as amended. is herein called the "Bankruptcy Code"), or shall file a voluntary
petition in bankruptcy seeking to effect a reorganization plan or other arrangement with creditors
or any other relief under the Bankruptcy Code or under any other state or federal law relating to
bankruptcy or other relief for debtors, whether now or hereafter in effect, or shall consent to or
suffer the entry of any order for relief in any involuntary case under the Bankruptcy Code, or
shall be the defendant or subject of any involuntary petition filed under the Bankruptcy Code that
is not dismissed within ninety (90) days of the filing thereof, or shall make an assignment for the
benefit of creditors;
(e) Any court (or similar tribunal) having jurisdiction over Trustor or any of
the Property or other property of Trustor shall enter a decree or order appointing a receiver,
trustee, guardian, conservator, assignee in bankruptcy or insolvency of Trustor, of any of the
Property, of any other real property of Trustor, of any other significant asset of Trustor, or shall
enter a decree or order for relief in any involuntary case under the Bankruptcy Code that is not
dismissed within ninety (90) days of the filing thereof, or shall make an assignment for the
benefit of creditors;
(f) The entry of any final judgment or arbitration award against Trustor that is
not paid or stayed pending appeal, or the sequestration or attachment of, or any levy or execution
upon (i) any of the Property, (ii) any other collateral provided by Trustor or any other person
under this Deed of Trust or as security for performance or payment of the Loan, or (iii) any
significant portion of the other assets of Trustor, which is not released, expunged or dismissed
prior to the earlier of (10) days after such sequestration, attachment or execution or five (5) days
before the sale of any such assets;
(g) Trustor shall dissolve, liquidate or wind up its affairs or shall bring any
legal action or take any other action contemplating such dissolution, liquidation or winding up;
(h) The determination by Beneficiary that any representation, warranty or
statement contained in this Deed of Trust or the DDA or in any other writing delivered to
Beneficiary in connection with the DDA or any other Transaction Documents was incomplete,
untrue or misleading in any material respect as of the date made;
~8:!S-272{)-0512.2
,2,604
22
(i) The occurrence of a default by Trustor under any of the contracts or
agreements assigned to Beneficiary under this Deed of Trust, where such default is not cured
within the applicable cure period, if any, or the failure of Trustor to diligently enforce its right~
and remedies under such contracts and agreements upon the default of any other party thereto:
and
(j) Trustor acknowledges and agrees that all material non-monetary defaults
are conclusively deemed to be and are defaults impairing the security of this Deed of Trust. and
that Beneficiary shall be entitled to exercise any appropriate remedy, including, without
limitation, foreclosure of this Deed of Trust, upon the occurrence of any such material non-
monetary default.
(k) Failure of Trustor to satisfy any performance of payment obligation
required under a senior deed of trust securing the construction financing approved by the agency
in writing;
(I) Failure of Trustor to properly perform its obligations under a senior deed
of trust (the "Senior Deed of Trust") or related documents, by the dates specified therein or upon
receipt of notice of such failure pursuant to the terms of such Senior Deed of Trust.
29. Rights and Remedies on Default. Upon the occurrence of any Default or Event of
Default under this Deed of Trust and at any time thereafter, Trustee or Beneficiary may exercise
anyone or more of the following rights and remedies:
(a) DDA Remedies. Beneficiary may exercise any right or remedy provided
for in the DDA, or any other Transaction Documents;
(b) Acceleration. Beneficiary may declare the Loan and all other
performances or sums secured by this Deed of Trust immediately due and payable;
(c) Foreclosure Rights. Beneficiary may declare all performances or sums
secured by this Deed of Trust immediately due and payable either by commencing an action to
foreclose this Deed of Trust as a mortgage, or by the delivery to Trustee of a written declaration
of default and demand for sale and of written notice of default and of election to cause the
Property to be sold, which notice Trustee shall cause to be duly filed for record in case of
foreclosure by exercise of the power of sale herein. Should Beneficiary elect to foreclose by
exercise of the power of sale herein, Beneficiary shall also deposit with Trustee this Deed of
Trust, the documents evidencing the Loan and any receipts and evidence of expenditures made
and secured hereby as Trustee may require, and notice of sale having been given as then required
by law and after lapse of such time as may then be required by law after recordation of such
notice of default, Trustee, without demand on Trustor, shall sell the Property at the time and
place of sale fixed by it in said notice of sale, either as a whole or in separate parcels, and in such
order as it may determine, at public auction to the highest bidder upon any terms and conditions
specified by Beneficiary and permitted by applicable law. Trustee may postpone sale of all or
any portion of the Property by public announcement at such time and place of sale, and from
time to time thereafter may postpone such sale by public announcement at the time fixed by the
";'>C8-2'"l2U..OS! ::.::
2 b 1)4
23
preceding postponement. Trustee shall deliver to any purchaser its deed or deeds conveying the
Property, or any portion thereof, so sold, but without any covenant or warranty, express or
implied. The recitals in such deed or deeds of any matters or facts, shall be conclusive proof of
the truthfulness thereof. Any person, including Trustor, Trustee or Beneficiary, may purchase all
or any portion of the Property, as applicable, at sale.
(d) Right to Rescind. Beneficiary, from time to time before Trustee's sale.
may rescind any such notice of breach or default and of election to cause the Property to be sold
by executing and delivering to Trustee a written notice of such rescission, which notice, when
recorded, shall also constitute a cancellation of any prior declaration of default and demand for
sale. The exercise by Beneficiary of such right of rescission shall not constitute a waiver of any
breach or default then existing or subsequently occurring, or impair the right of Beneficiary to
execute and deliver to Trustee, as above provided, other declarations of default and demand for
sale, and notices of breach or default, and of election to cause the Property to be sold to satisfy
the obligations hereof, nor otherwise affect any provision, agreement, covenant or condition of
the DDA and/or of this Deed of Trust or any of the rights, obligations or remedies of the parties
hereunder.
(e) UCC Remedies. Beneficiary shall have all the rights and remedies of a
secured party under the California Commercial Code, including, without limitation, Section
9501(4) thereof. Upon request, Trustor shall assemble and make such collateral available to
Beneficiary at a place to be designated by Beneficiary that is reasonably convenient to both
parties. Upon repossession, Beneficiary may propose to retain the collateral in partial satisfaction
of the Loan or sell the collateral at public or private sale in accordance with the California
Commercial Code or any other applicable statute. Such sale may be held as a part of, distinctive
from or without a trustee's sale or foreclosure of the real property secured by this Deed of Trust.
If any notification of disposition of all or any portion of the collateral is required by law, such
notification shall be deemed reasonably and properly given, if mailed at least ten (10) days prior
to such disposition. If Beneficiary disposes of all or any part of the collateral after default, the
proceeds of disposition shall be applied in the following order:
(i) to the reasonable expenses of retaking, holding, preparing for sale, selling
the collateral, and the like;
(ii) to the reasonable attorneys' fees and legal expenses incurred by
Beneficiary; and
(iii) to the satisfaction of the indebtedness secured bv this Deed of Trust.
(f) Remedial Advances. Should Trustor fail to make any payment or to do
any act as herein provided, then Beneficiary or Trustee, without obligation so to do and without
demand upon Trustor and without releasing Trustor from any obligation hereof, may (i) make or
do the same in such manner and to such extent as either may deem necessary to protect the
security hereof, Beneficiary or Trustee being authorized to enter upon the Property for such
purposes; (ii) commence, appear in and defend any action or proceeding purporting to affect the
security hereof or the rights or powers of Beneficiary or Trustee, (iii) pay, purchase, contest or
-HCS-2720-0512.2
i2604
24
compromise any encumbrance, charge, lien, tax or assessment, or the premium for any policy of
insurance required herein; and in exercising any such power, incur any liability, expend whatever
amounts in its absolute discretion it may deem necessary therefor, including cost of evidence of
title, employ counsel and pay such counsel's fees. Beneficiary shall be subrogated to the rights
and lien interests of any person who is paid by Beneficiary pursuant to the terms of this
paragraph. Trustor shall repay immediately on written notice to Trustor all sums expended or
advanced hereunder by or on behalf of Beneficiary, with interest from the date of such advance
or expenditure at the rate of 10% per annum, and the repayment thereof shall be secured hereby.
(g) Summary Possession. Beneficiary may, at its option, either in person or
by agent, employee or court-appointed receiver, enter upon and take possession of the Property
and continue any work of improvement, repair or renovation thereof at Trustor's expense and
lease the same or any part thereof, making such alterations as it finds necessary, and may
terminate in any lawful manner any lease(s) of the Property, exercising with respect thereto any
right or option available to the Trustor. The entering upon and taking possession of the Property,
the collection of rents, issues and profits, or the proceeds of fire and other insurance policies or
compensation or awards for any taking or damage to the Property, and the application or release
thereof shall not cure or waive any default or notice of default hereunder or invalidate any act
done pursuant to such notice.
(h) Collection of Rents. Beneficiary may require any tenant or other user of
the Property to make payments of rent or use fees directly to Beneficiary, regardless of whether
Beneficiary has taken possession of the Property. If any rents are collected by Beneficiary, then
Trustor hereby irrevocably designates Beneficiary as Trustor's attorney-in-fact to endorse
instruments received in payment thereof in the name of Trustor and to negotiate the same and
collect the proceeds. Payments by tenants or other users to Beneficiary in response to
Beneficiary's demand shall satisfy the obligation for which the payments are made, whether or
not any proper grounds for the demand existed. Beneficiary may exercise its rights under this
paragraph either in person, by agent or through a receiver.
(i) Beneficiarv's Enforcement of Leases. Beneficiary is hereby vested with
full power to use all measures, legal and equitable, deemed by it necessary or proper to collect
the rents assigned in this Deed of Trust, including the right, in person or by agent, employee or
court-appointed receiver, to enter upon the Property, or any part thereof, and take possession
thereof forthwith to the extent necessary to effect the cure of any default on the part of Trustor as
lessor in any leases or upon Trustor's default under the DDA. Trustor hereby grants to
Beneficiary full power and authority to exercise all rights, privileges and powers herein granted
at any and all times hereafter, without notice to Trustor, including the right to operate and
manage the Property, make and amend leases and perform any other acts reasonably necessary to
protect the value, priority or enforceability of any security for the obligations of the Trustor
under the DDA or this Deed of Trust and use and apply all of the rents and other income herein
assigned to the payment of the costs of exercising such remedies, of managing and operating the
Property, and of any indebtedness or liability of Trustor to Beneficiary, including but not limited
to the payment of taxes, special assessments, insurance premiums, damage claims. the costs of
maintaining, repairing, rebuilding and restoring any improvements on the Property or of making
the same rentable. attorneys' fees incurred in connection with the enforcement of this Deed of
4828-2720-<l512.2
126,04
25
Trust, and any principal and interest payments due from Trustor to Beneficiary under the DDA,
the Note and this Deed of Trust, all in such order as Beneficiary may determine. Beneficiary
shall be under no obligation to enforce any of the rights or claims assigned to it hereunder or to
perform or carry out any of the obligations of the lessor under any leases and does not assume
any of the liabilities in connection with or arising or growing out of the covenants and
agreements of Trustor in any leases. It is further understood that this Deed of Trust shall not
operate to place responsibility for the control, care, management or repair of the Property, or
parts thereof, upon Beneficiary nor shall it operate to make Beneficiary liable for the carrying out
of any of the terms and conditions of any leases, or for any waste of the Property by the lessee
under any leases or by any other party, or for any dangerous or defective condition of the
Property or for any negligence in the management, upkeep, repair or control of the Property
resulting in loss or injury or death to any lessee, invitee, licensee, employee or stranger, except as
may result from the gross negligence or willful misconduct of Beneficiary after taking
possession of the Property hereunder.
(j) Beneficiary's Enforcement of Contracts. Beneficiary shall have the right
to enforce Trustor's rights under all architect, engineering, construction and related contracts and
to bring an action for the breach thereof in the name of Beneficiary or, at Beneficiary's option, in
the name of Trustor, in the event any architect, engineer, contractor or other party breaches their
respective contract or contracts, regardless of whether Beneficiary acquires or retains any interest
in the Property. Trustor hereby irrevocably appoints Beneficiary as its attorney-in-fact for the
purposes of the foregoing, which power shall be durable and coupled with an interest.
Beneficiary does not assume and shall not be obligated to perform any of Trustor's obligations
under said contracts nor shall Beneficiary be required to enforce such contracts or bring action
for the breach thereof; provided however, any performance of the respective contracts
specifically required by the Beneficiary in writing, following any default by Trustor under the
DDA, this Deed of Trust, any other Transaction Documents or the contracts, and which is
properly and timely undertaken by the contractor, engineer or architect, shall be paid for by the
Beneficiary in accordance with the terms and conditions of the contracts. Such payments shall
be deemed additions to the amounts owed by Trustor to the Beneficiary under the DDA and the
Note and secured by this Deed of Trust and shall bear interest at the rate of 10% per annum from
the date of advance to and including the date of full payment, and shall be secured by any deed
of trust, collateral assignment of leases and rents, security agreement and other documents
granted to secure the Loan.
(k) Appointment of Receiver. Beneficiary has the right to have a receiver
appointed to take possession of any or all of the Property, with the power to protect and preserve
the Property, to operate the Property preceding foreclosure or sale, to collect the income from the
Property and apply the proceeds, over and above the cost of the receivership, against the'Loan.
The receiver may serve without bond, if permitted by law. Beneficiary's right to the appointment
of a receiver shall exist whether or not the apparent value of the Property exceeds the
indebtedness secured hereby by a substantial amount. Employment by Beneficiary shall not
disqualify a person from serving as a receiver. Upon taking possession of all or any part of the
Property, the receiver or Beneficiary may: (i) use, operate, manage, control and conduct business
on the Property and make expenditures for all maintenance and improvements as in its judgment
are necessary and proper; (ii) collect the income from the Property and apply such sums to the
~828-2720-D512,2
12'b'O~
26
expenses of use, operation and management; and (iii) at Beneficiary's option, complete any
construction in progress on the Property, and in that connection pay bills, borrow funds, employ
contractors and make any changes in plans or specifications as Beneficiary deems reasonably
necessary or appropriate. If the revenues produced by the Property are insufficient to pay
expenses, the receiver may borrow, from Beneficiary or otherwise, as Beneficiary may deem
reasonably necessary for the purposes stated in this paragraph. The amounts borrowed or
advanced shall be payable on demand and bear interest from the date of expenditure until repaid
at the rate of 10% per annum. Such sums shall become a part of the debt secured by this Deed of
Trust.
(I) Specific Enforcement. Beneficiary may specifically enforce any covenant
in this Deed of Trust or the Trustor's compliance with its warranties herein and may restrain and
enjoin the breach or prospective breach of any such covenant or the noncompliance with any
condition and Trustor waives any requirement of the posting of any bond in connection
therewith.
(m) General Creditors' Remedies. Beneficiary shall have such other rights and
remedies as are available under any statute or at law or in equity, generally, and the delineation
of certain remedies in this Deed of Trust shall not be deemed in limitation thereof
30. Application of Sale Proceeds. After deducting all costs and expenses of Trustee
and of this Deed of Trust, including cost of evidence of title and reasonable attorneys' fees in
connection with sale, as above set forth, Trustee shall apply the proceeds of sale to payment of
all sums expended under the terms hereof, not then repaid, with accrued interest at the rate of
10% per annum; all other sums then secured hereby; and the remainder, if any, to the Beneficiary
and any other person or persons legally entitled thereto.
31. Remedies Cumulative. No remedy herein conferred upon or reserved to Trustee
or Beneficiary is intended to be exclusive of any other remedy provided herein or under the DDA
or any other Transaction Documents, or otherwise by law provided or permitted, or provided in
any guaranty given in connection with the Loan, but each shall be cumulative and shall be in
addition to every other remedy. Every power or remedy given by this instrument to Trustee or
Beneficiary or to which either of them may be otherwise entitled, may be exercised concurrently
or independently, from time to time and as often as may be deemed expedient by Trustee or
Beneficiary and either of them may pursue inconsistent remedies.
32. No Waiver. No waiver of any default or failure or delay to exercise any right or
remedy by Beneficiary shall operate as a waiver of any other default or of the same default in the
future or a preclusion of any right or remedy with respect to the same or any other occurrence.
33. Marshaling. In case of a sale under this Deed of Trust, the Property, real,
personal and mixed, may be sold in one or more parcels. Neither Trustee nor Beneficiary shall
be required to marshal Trustor's assets.
34.
SlJBMISSION TO JURISDICTION.
-1.823-2"7204)51 :.2
;: 0..04
27
(A) TRUSTOR, TO THE FULLEST EXTENT PERMITTED BY LAW,
HEREBY KNOWINGLY, INTENTIONALLY AND VOLUNTARILY, WITH AND
UPON THE ADVICE OF COMPETENT COUNSEL, (A) SUBMITS TO PERSONAL
JURISDICTION IN THE STATE OF CALIFORNIA OVER ANY SUIT, ACTION OR
PROCEEDING BY ANY PERSON ARISING FROM OR RELATING TO THIS DEED
OF TRUST, (B) AGREES THAT ANY SUCH ACTION, SUIT OR PROCEEDING MAY
BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT
JURISDICTION SITTING IN SAN BERNARDINO COUNTY, CALIFORNIA, (C)
SUBMITS TO THE JURISDICTION OF SUCH COURTS, AND, (D) TO THE FULLEST
EXTENT PERMITTED BY LAW, AGREES THAT IT WILL NOT BRING ANY
ACTION, SUIT OR PROCEEDING IN ANY FORUM OTHER THAN SAN
BERNARDINO COUNTY, CALIFORNIA (BUT NOTHING HEREIN SHALL AFFECT
THE RIGHT OF BENEFICIARY TO BRING ANY ACTION, SUIT OR PROCEEDING
IN ANY OTHER FORUM). TRUSTOR FURTHER CONSENTS AND AGREES TO
SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER LEGAL PROCESS IN ANY
SUCH SUIT, ACTION OR PROCEEDING BY REGISTERED OR CERTIFIED U.S.
MAIL, POSTAGE PREPAID, TO THE TRUSTOR AT THE ADDRESS FOR NOTICES
DESCRIBED HEREIN, AND CONSENTS AND AGREES THAT SUCH SERVICE
SHALL CONSTITUTE IN EVERY RESPECT VALID AND EFFECTIVE SERVICE
(BUT NOTHING HEREIN SHALL AFFECT THE VALIDITY OR EFFECTIVENESS
OF PROCESS SERVED IN ANY OTHER MANNER PERMITTED BY LAW).
(B) TRUSTOR, TO THE FULLEST EXTENT PERMITTED BY LAW,
HEREBY KNOWINGLY, INTENTIONALLY AND VOLUNTARILY, WITH AND
UPON THE ADVICE OF COMPETENT COUNSEL, WAIVES, RELINQUISHES AND
FOREVER FORGOES THE RIGHT TO A TRIAL BY JURY IN ANY ACTION OR
PROCEEDING BASED UPON, ARISING OUT OF, OR IN ANY WAY RELATING TO
THIS DEED OF TRUST OR ANY CONDUCT, ACT OR OMISSION OF BENEFICIARY
OR TRUSTOR, WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE.
35. Trustor's Indemnification. Trustor agrees to indemnify and hold harmless Trustee
and Beneficiary from and against any and all losses, liabilities, penalties, claims, charges, costs
and expenses (including attorneys' fees and disbursements) (the "Losses") that may be imposed
on, incurred or paid by or asserted against Trustee and/or Beneficiary by reason or on account of,
or in connection with: (a) any default by Trustor hereunder or under the DDA or other
Transaction Documents; (b) Trustee's and/or Beneficiary's good faith and commercially
reasonable exercise of any of their rights and remedies or the performance of any of their duties
hereunder or under any other documents to which Trustor is a party; (c) the construction,
reconstruction or alteration of the Property; (d) any negligence, willful misconduct or failure to
act of Trustor, or any negligence, willful misconduct or failure to act of any lessee of the
Property, or any of their respective agents, contractors, subcontractors, servants, employees,
licensees or invitees; or (e) any accident, injury, death or damage to any person or property
occurring in, on or about the Property or any street, drive, sidewalk, curb or passageway adjacent
thereto, except for the willful misconduct or gross negligence of the indemnified person; or (f)
after the date hereof, any failure of Trustor to file any tax reports or returns referred to in this
Deed of Trust. The indemnity provided under subsection (f) of this paragraph shall also extend
~828-2"20..o512.2
126.04
28
to counsel for the Beneficiary. Any amount payable to Trustee, Beneficiary or counsel for
Beneficiary under this paragraph shall be due and payable within ten (10) days after demand
therefor and receipt by Trustor of a statement from Trustee, Beneficiary and/or counsel for
Beneficiary setting forth in reasonable detail the amount claimed and the basis therefor, and such
amounts shall bear interest at the rate of 10% per annum from and after the date such amounts
are paid by Beneficiary, Trustee or counsel for Beneficiary, until paid in full by Trustor.
Trustor's obligations under this paragraph shall not be affected by the absence or unavailability
of insurance covering the same or by the failure or refusal by any insurance carrier to perform
any obligation on its part under any such policy of insurance. If any claim, action or proceeding
is made or brought against Trustor and/or Beneficiary that is subject to the indemnity set forth in
this paragraph, Trustor shall resist or defend against the same, if necessary, in the name of
Trustee and/or Beneficiary, with attorneys for Trustor's insurance carrier (if the same is covered
by insurance) or otherwise by attorneys approved by Beneficiary. Notwithstanding the
foregoing, Trustee and Beneficiary, in their reasonable discretion, may engage their own
attorneys to resist or defend, or assist therein, and Trustor shall pay, or, on demand, shall
reimburse Trustee and Beneficiary for the payment of the reasonable fees and disbursements of
said attorneys. The indemnity provided for herein shall survive Trustor's performance under the
DDA and the Note secured by this Deed of Trust and foreclosure, whether by judicial
foreclosure, power of sale pursuant to this Deed of Trust or by deed in lieu of foreclosure.
36. Attornevs' Fees: Costs. Trustor agrees to reimburse Beneficiary for all costs,
expenses expert witness and consulting fees and reasonable attorneys' fees that Beneficiary
incurs in connection with the realization or enforcement of any obligation or remedy contained in
this Deed of Trust, the DDA or any other Transaction Documents, with or without litigation,
including without limitation any costs, expenses and fees incurred: (a) on appeal; (b) in any
arbitration or mediation; (c) in any action contesting or seeking to restrain, enjoin, stay, or
postpone the exercise of any remedy in which Beneficiary prevails; (d) in any bankruptcy,
probate, receivership or other proceeding involving Trustor; and (e) in connection with all
negotiations, documentation, and other actions relating to any work-out, compromise, settlement
or satisfaction of the debt secured hereby or settlement of any covenants and obligations secured
by this Deed of Trust or set forth in the DDA or any other Transaction Documents. For the
purposes hereof. the words "reasonable attorneys' fees" shall mean and include the salaries and
fringe benefits of the City Attorney and lawyers employed by the City Attorney of the City of
San Bernardino, computed on a hourly basis, who may provide legal services to the Beneficiary
in connection with the exercise by the Beneficiary of any of its remedies hereunder. All such
costs, expenses and fees shall be due and payable upon demand, shall bear interest from the date
incurred through the date of collection at the rate of 10% per annum, and shall be secured by this
Deed of Trust.
37. Acceptance by Trustee. Trustee accepts this Trust when this Deed of Trust. duly
executed and acknowledged, is made a public record. as provided by law.
38. Successor Trustee. Trustee may resign by an instrument in writing addressed to
Beneficiary, or Trustee may be removed at any time with or without cause by an instrument in
writing executed by Beneficiary and duly recorded. In case of the death, resignation, removal or
disqualification of Trustee or if for any reason Beneficiary shall deem it desirable to appoint a
.+X2X-:720-DS12.:
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29
substitute or successor trustee to act instead of Trustee herein named or any substitute or
successor trustee, then Beneficiary shall have the right and is hereby authorized and empowered
to appoint a successor trustee, or a substitute trustee, without. other formality than appointment
and designation in writing executed and acknowledged by Beneficiary and the recordation of
such writing in the office where this Deed of Trust is recorded, and the authority hereby
conferred shall extend to the appointment of other successor and substitute trustees successively.
Such appointment and designation by Beneficiary shall be full evidence of the right and authority
to make the same and of all facts therein recited. If such appointment is executed on behalf of
Beneficiary by an officer of Beneficiary, such appointments shall be conclusively presumed to be
executed with authority and shall be valid and sufficient without proof of any action by the
. Trustee or any officer of Beneficiary. Upon the making of such appointment and designation, all
of the estate and title of Trustee in the Property shall vest in the named successor or substitute
trustee and it shall thereupon succeed to and shall hold, possess and execute all the rights,
powers, privileges, immunities and duties herein conferred upon Trustee; but, nevertheless, upon
the written request of Beneficiary or of the successor substitute trustee, the Trustee shall execute
and deliver an instrument transferring to such successor or substitute trustee all of the estate and
title in the Property of the trustee so ceasing to act, together with all the rights, powers,
privileges, immunities and duties herein conferred upon Trustee, and shall duly assign, transfer
and deliver any of the properties and moneys held by the Trustee hereunder to said successor or
substitute trustee. All references herein to Trustee shall be deemed to refer to any trustee
(including any successor or substitute, appointed and designated, as herein provided) from time
to time acting hereunder. Trustor hereby ratifies and confirms any and all acts that Trustee herein
named or its successor or successors, substitute or substitutes, in this Deed of Trust, shall do
lawfully by virtue hereof.
39. Reconvevance. Upon written request of Beneficiary, stating that all performances
and sums secured hereby have been satisfied and paid, and upon surrender of the Note and this
Deed of Trust to Trustee for cancellation and retention, and upon payment of its fees, Trustee
shall reconvey, without warranty, the Property then held hereunder. The recitals in any
reconveyance executed under this Deed of Trust of any matters or facts shall be conclusive proof
of the truthfulness thereof. The grantee in such reconveyance may be described as .'the person or
petsons legally entitled thereto."
40. No Releases. The Property shall not be released from the lien of this Deed of
Trust and no person shall be released from liability under the Loan or any other obligation
secured hereby, except in the manner herein specified. Without affecting the liability of any
other person for the payment and performance of any obligation herein mentioned (including
Trustor should it convey said Property) and without affecting the lien or priority hereof upon any
Property not released, Beneficiary may, without notice, release any person so liable, extend the
maturity or modify the terms of any such obligation, grant other indulgences, make future or
other advances to Trustor or anyone or more parties comprising Trustor, assign or in any manner
transfer this Deed of Trust, release or reconvey or cause to be released or reconveyed at any time
all or part of the said Property described herein, take or release any other security or make
compositions or other arrangements with debtors. Beneficiary may also accept additional
security, either concurrently herewith or thereafter, and sell same or otherwise realize thereon,
either before, concurrently with, or after sale hereunder.
-I828-2720-D512.2
12604
30
41. Beneficiary's Consents. At any time, upon written request of Trustor. Trustor'~
payment of Beneficiary's fees and presentation of this Deed of Trust (in case of full
reconveyance, for cancellation and retention), without affecting the liability of any person for the
payment of the indebtedness, Beneficiary may: (a) consent to the making of any map or plat of
said Property; (b) join in granting any easement or creating any restriction thereon, (c) join in
any other agreement affecting this Deed of Trust or the lien or charge thereof, and (d) reconvey,
without warranty, all or any part of the Property.
42. Further Assurances. Trustor, from time to time, within fifteen (15) days after
request by Beneficiary, shall execute, acknowledge and deliver to Beneficiary, such chattel
mortgages, security agreements or other similar security instruments, in form and substance
reasonably satisfactory to Beneficiary, covering all property of any kind whatsoever owned by
Trustor or in which Trustor has any interest which, in the reasonable opinion of Beneficiary, is
essential to the operation of the Property covered by this Deed of Trust. Trustor shall further,
from time to time, within fifteen (15) days after request by Beneficiary, execute, acknowledge
and deliver any financing statement, renewal, affidavit, certificate, continuation statement or
other document as Beneficiary may reasonably request in order to perfect, preserve, continue,
extend or maintain the security interest under, and the priority of, this Deed of Trust and the
priority of each such chattel mortgage or other security instrument. Trustor further agrees to pay
to Beneficiary on demand all reasonable costs and expenses incurred by Beneficiary in
connection with the preparation, execution, recording, filing and refiling of any such instrument
or document. including the charges for examining title and the attorneys' fees for rendering an
opinion as to priority of this Deed of Trust and of such chattel mortgage or other security
instrument as a valid and subsisting lien. However, neither a request so made by Beneficiary,
nor the failure of Beneficiary to make such request shall be construed as a release of such
Property, or any part thereof, from the conveyance of title under this Deed of Trust, it being
understood and agreed that this covenant and any such chattel mortgage, security agreement or
other similar security instrument delivered to Beneficiary are cumulative and given as additional
security.
43. Time of Performance. Time is of the essence hereof in connection with all
obligations of the Trustor herein and under the DDA.
44. Notices. The undersigned Trustor requests that a copy of any Notice of Default or
Notice of Sale hereunder be mailed to it at its address as hereinbefore set forth. Any notices to
be given to Trustor by Beneficiary or Trustee hereunder shall be sufficient, if personally
delivered or mailed, postage prepaid, to the address of the Trustor stated hereinabove, or to such
other address that Trustor has requested in writing to Beneficiary. Any time period provided in
the giving of any notice hereunder shall commence upon the date such notice is delivered or
deposited with the United States Postal Service for delivery by regular first-class postage pre-
paid mail, as officially recorded on the certified mail receipt.
45. Beneficiary's Right to Inspect. Beneficiary and its agents and representatives
may enter upon the Property at all reasonable times to attend to Beneficiary's interest and to
inspect the Property.
~8::8-2720-O.512.2
12.0;0.+
31
.
46. Modification. This Deed of Trust may be amended, modified, changed or varied
only by a written agreement signed by all of the parties hereto. No requirement of this Deed of
Trust may be waived, at any time, except in a writing signed by Beneficiary and any such waiver
shall be effective only as to its terms and on a single occasion. Neither, Beneficiary's delay or
omission in exercising any right, power or remedy under this Deed of Trust upon default of
Trustor nor Beneficiary's failure to insist upon strict performance of any of the covenants or
agreements contained in this Deed of Trust shall be construed as a waiver of any such right,
power. remedy. covenant or agreement or as an acquiescence in Trustor's breach or default.
47. Assignment bv Beneficiary: Participation. Beneficiary may assign this Deed of
Trust in whole or in part to any person and may grant participations in any of its rights under this
Deed of Trust, without notice and without affecting Trustor's liability under this Deed of Trust.
In connection with any proposed assignment, participation or similar arrangement, Beneficiary
may make available to any person all credit and financial data furnished or to be furnished to
Beneficiary by Trustor. Trustor agrees to provide to the person designated by Beneficiary any
information as such person may reasonably require to form a decision regarding the proposed
assignment. participation or other arrangement. Trustor may not assign this Deed of T rust to any
person at any time, except in connection with a transaction approved in writing by Beneficiary,
under the terms of this Deed of Trust with a transaction approved in writing by Beneficiary.
under the terms of this Deed of Trust.
48. Successors. Subject to the prohibitions against Trustor's assignments herein. this
Deed of Trust shall inure to the benefit of and bind all of the parties, their successors, estates,
heirs, personal representatives and assigns.
49. Partial Invaliditv. If a court of competent jurisdiction finally determines that any
provision of this Deed of Trust is invalid or unenforceable, the court's determination shall not
affect the validity or enforceability of the remaining provisions of this Deed of Trust. In such
event, this Deed of Trust shall be construed as if it did not contain the particular provision that
was determined to be invalid or unenforceable. No such determination shall affect any provision
of this Deed of Trust to the extent that it is otherwise enforceable under the laws of any other
applicable jurisdiction.
50. Mutual Negotiation. Beneficiary and Trustor confirm that they have mutually
negotiated this Deed of Trust and that none of the terms or provisions of this Deed of Trust shall
be construed against either party.
51. Paragraph Headings. The paragraph headings in this Deed of Trust are for
convenience only and in no way define, limit, extend, or describe the scope or intent of this Deed
of Trust or any of its provisions.
52. Ap?licable Law. This Deed of Trust and the rights of the parties hereunder shall
be governed by, construed and enforced in accordance with the laws of the State of California.
..828-2720-0512.2
12,6'04
32
.
,
53. Entire Agreement. This Deed of Trust, the DDA, the Note and the other
Transaction Documents, including any exhibits or addenda, contains the entire agreement of the
parties with respect to the subject matter hereof
54. Counteroarts. This Deed of Trust may be executed in two or more counteIparts,
all of which together shall constitute one and the same instrument and lien. The signature pages
of exact copies of this Deed of Trust may be attached to one copy to form one complete
document. Additional copies of this Deed of Trust may be executed in counterparts and recorded
in two or more counties, all of which shall constitute one and the same instrument and lien.
55. Fixture Filing and Recording. This Deed of Trust constitutes a financing
statement filed as a fixture filing under California Commercial Code Section 9502(c), as
amended or recodified from time to time. This Deed of Trust is to be recorded in the real estate
records of San Bernardino County, California, and covers goods that are, or are to become.
fixtures.
56. Survival of Representations and Warranties. All of Trustor's representations and
warranties contained in this Deed of Trust shall be true and correct at all times during the term of
the Loan secured hereby, until full repayment of the Loan and release and reconveyance of this
Deed of Trust.
(signature page to Jollo'W)
~82g':~:20-0512.2
!~ 604
33
.
~
IN WITNESS WHEREOF, Trustor hereby duly executes this Deed of Trust as of the day
and year first above written.
TRUSTOR
Meadowbrook Park Homes, Inc., a California
corporation
By:
Its:
By:
Its:
[NOTARY JURAT ATTACHED]
.+xlX-l"710-0511.1
:: 004
34
.
..
EXHIBIT "A"
LEGAL DESCRIPTION OF PROPERTY
4828-2'20-D5122
12/6/04
35
..
** FOR OFFICE USE ONLY - NOT A PUBLIC DOCUMENT **
~.'
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RESOLUTION AGENDA ITEM TRACKING FORM
Meeting D'te (Da', Ad?"d) ~ Item' {l/J.:J; (b) R,wl"tion .(lJ):2 /)00 f -I
Vote: Ayes --b Nays Abstain AJsent * '6
Change to motion to amend original documents 0 Companion Resolutions
NulI!Void After: days /
Resolution # On Attachments: 0 Note on Resolution of attachment stored separately: 0
PUBLISH 0
POST 0
RECORD W/COUNTY 0
By:
Date Sent to Mayor: 0 I
Date of Mayor's Signature: (;
Date of Clerk/CDC Signature:
Reso. Log Updated:
Seal Impressed:
o
o
Date Memo/Letter Sent for Signature:
I Sl Reminder Letter Sent:
Date Returned:
2nd Reminder Letter Sent:
Not Returned: 0
Request for Council Action & Staff Report Attached:
Updated Prior Resolutions (Other Than Below):
Updated CITY Personnel Folders (6413, 6429, 6433, 10584, 10585, 12634):
Updated CDC Personnel Folders (5557):
Updated Traffic Folders (3985, 8234, 655, 92-389):
Yes No By_
Yes No By_
Yes No By_
Yes No By_
Yes No By_
Copies Distributed to:
Animal Control 0
City Administrator 0
City Attorney 0
Code Compliance 0
Development Services 0
Others:
EDA 0 Information Services 0
Facilities 0 Parks & Recreation 0
Finance 0 Police Department 0
Fire Department 0 Public Services 0
Human Resources 0 Water Department 0
Notes:
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Ready to File: ~
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Revised 12/18/03
CITY OF SAN BERNARDINO
Interoffice Memorandum
CITY CLERK'S OFFICE
Records and Information Management (RIM) Program
DATE:
January 18, 2005
TO:
Wasana Chantha, Acting Secretary
FROM:
Eileen Gomez, Senior Secretary
RE:
Transmitting Documents for Signature - Resolution CDC/2005-l
.10
At the Mayor and Common Council meetin ece ber , 2004, the City of San Bernardino
adopted Resolution CDC/2005-l - Resolution approving the 2005 Meadowbrook Single Family
Residential Disposition and Development Agreement by and between the Redevelopment Agency
of the City of San Bernardino and Meadowbrook Park Homes, Inc. (Affordable Housing
Development - IVDA Redevelopment Project Area).
Attached is one (1) original agreement with two (2) duplicate original signature pages. Please
obtain signatures in the appropriate locations and return the ORIGINAL agreement to the City
Clerk's Office as soon as possible, to my attention. Please keep the fully executed copies for
your records and for the other party.
If you have any questions, please do not hesitate to contact me at ext. 3206. Thank you.
Eileen Gomez
Senior Secretary
I hereby a
ledge receipt of the above mentioned documents.
Signed:
Date:
1/181V5
Please sign and return
ECONOMIC DEVELOPMENT AGENCY
OF THE CITY OF SAN BERNARDINO
INTER-OFFICE MEMORANDUM
TO:
~ (\ Eileen Gomez, Senior Secretary, City Clerk's Office
~W asana A. Chantha, Secretary
Executed Document
FROM:
SUBJECT:
DATE:
January 25, 2005
Enclosed is the fully executed Agreement pertaining to the following resolution:
CDC/2005-l A RESOLUTION OF THE COMMUNITY DEVELOPMENT
COMMISSION OF THE CITY OF SAN BERNARDINO APPROVING
THE 2005 MEADOWBROOK SINGLE FAMILY RESIDENTIAL
DISPOSITION AND DEVELOPMENT AGREEMENT BY AND
BETWEEN THE REDEVELOPMENT AGENCY OF THE CITY OF
SAN BERNARDINO AND MEADOWBROOK PARK HOMES, INC.
(AFFORDABLE HOUSING DEVELOPMENT IVDA
REDEVELOPMENT PROJECT AREA)
Should you have any questions, I can be reached at (909) 663-1044.
Thank you.
Enclosure
cc:
Barbara Lindseth (with Original Executed Agreement)
George Jordan (with Original Executed Agreement)
Musibau Arogundade (with Copy of Agreement)
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