HomeMy WebLinkAboutR30-Economic Development Agency
r
. ,
ECONOMIC DEVELOPMENT AGENCY
OF THE CITY OF SAN BERNARDINO
FROM:
Maggie Pacheco, Deputy Director/Director
Housing & Community Development
SUBJECT:
DEVELOPMENT OF AGENCY OWNED
LAND LOCATED AT NORTHEAST
CORNER OF CALIFORNIA & 16TH
STREETS BY CENTURY CROWELL
COMMUNITIES-NORTHWEST
REDEVELOPMENT PROJECT AREA
DATE:
March 21, 2002
O~'I"'" 'L
hi"",,~d
SvnoDsis of Previous Commissioo/CouncilfCommittee Action(s):
On December 6, 200 I, the Redevelopment Committee recommended that this item be sent to Community Development
Commission for approval.
Subsequently, on January 7, 2002, the Community Development Commission approved Amendment No. 2 to the
Disposition and Development Agreement (the "DDA") dated July 19, 1999, and as subsequently amended on December
4,2000 by and between the Agency and Century Crowell Communities, L.P., (the "Developer") for the development of
38 single family homes at the northeast comer of California and 16th Streets within the Northwest Redevelopment
Project Area.
On March 7 and March 18,2002, Staff informed the Redevelopment Committee and the Community Development
Commission of some of the significant changes in the January 2002 California Redevelopment Law which affect the
previously approved and structured January 7, 2002 DDA. As such, the Community Development Commission
authorized Staff to commence the necessary changes to the DDA in order to effectuate the provisions of the law and
return to the Commission for ratification ofthe necessary modifications to the January 7, 2002 DDA on April I, 2002.
RecommeDded MolioD(S):
MOTION:
RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF SAN
BERNARDINO APPROVING AND AUTHORIZING THE AGENCY EXECUTIVE DIRECTOR TO
EXECUTE THE SECOND AMENDED AND RESTATED DISPOSITION AND DEVELOPMENT
AGREEMENT, (THE "AMENDMENT NO.2") BY AND BETWEEN THE REDEVELOPMENT
AGENCY AND CENTURY CROWELL COMMUNITIES, L.P., ("DEVELOPER")
DEVELOPMENT OF 38 PARCELS LOCATED WITHIN THE NORTHWEST REDEVELOPMENT
PROJECT AREA
Contact Person(s): Gary Van Osdel/Maggie Pacheco
Project Area(s) Northwest Redevelopment Project Area
Phone:
Ward(s):
(909) 663-1044
Six (6)
Supporting Data Attached: 0 Staff Report 0 Resolution(s) 0 Agreement(s)/Contract(s) 0 Map(s) 0 Reports
Agency Housing Fund (Low /Moderate
FUNDING REQUIREMENTS 710,400 Source: Income Housing Program)
SIGNATURE:
1ZFSO-:ttClX:!?CPd-/b
-------~--------------------------------------------_.--------------------------------------------------------------------------------------
GVO:MP:sj:4-1-02 Century Crowell
COMMISSION MEETING AGENDA
MeeliDg Dale: 04/01/02
AgeDda Item Number: ..&30
r
ECONOMIC DEVELOPMENT AGENCY
STAFF REPORT
Disoosition and Deyelooment Of Al!encY Owned Land Located at The Northeast Corner
Of California & 16th Streets By Century Crowell Communities-
Northwest Redeyelooment Proiect Area.
BACKGROUND:
In December 2000, the Community Development Commission approved Amendment No. 1 to
the Disposition and Development Agreement (DDA) dated July 19, 1999 by and between the
Agency and Century Crowell Communities (the "Developer") for the development of 24 new
single-family homes on 14.6 acres of residential land, in the vicinity of 19th and Pennsylvania,
commonly referred to as Arrow Vista (Phase I), (Northwest Redevelopment Project Area). To
date, all 24 homes have been constructed, sold and therefore, Phase I has been completed by the
Developer.
Subsequently, on January 7, 2002, the Community Development Commission approved
Amendment No.2 to the DDA to allow the sale of the land owned by the Agency located in the
vicinity of California and 16th Streets, consisting of 38 single-family lots (Phase II-Del Rey at
Arrow Vista) to the Developer for the development of 38 new single-family homes. See map of
the Site attached.
At the time Amendment No.2 was approved by the Community Development Commission, the
following deal points were agreed upon by the Developer and the Agency:
. Developer would repay the Agency the two outstanding promissory notes in the total sum
of $229,000. This amount represents land cost for the Phase I lots and the purchase price
for the Susie Lane home.
. Any unused previously allocated Mortgage Assistance Program (MAP) funds from Phase
I would roll over into the Phase II project. Estimated balance is $166,000, of the original
sum amount of $240,000.
. Developer would buy the 38 lots from the Agency at the appraised as is fair market value
of $100,000.
. Developer would develop 38 single-family homes ranging in square footage of 1,316 to
2,000. The Phase II would be developed consistent with the approved plans and
specifications approved by the Planning Commission for Phase I. In other words, the
scope of development will not drastically change, with the exception of construction of
the necessary infrastructure.
GYO:MP:sj:4-1-02 Century Crowell
COMMISSION MEETING AGENDA
Meeting Date: 04/01102
Agenda Item Number: /{30
Economic Development Agency Staff Report
Century Crowell - Development of Agency Parcels
March 21, 2002
Page Number -2-
. The Developer would be responsible for installing and constructing the necessary
infrastructure, such as curbs, gutters, streets, sewers, storm drains, etc. The current
estimated cost for such infrastructure is approximately $850,000. The Agency's
contribution to offset the infrastructure costs was set at $710,400. The Developer was
required to pay prevailing wages related to the construction of such improvements. The
Developer would also pay for all development fees including, but not limited to, school
district fees.
. Based on the project pro-forma and the Agency's financial contribution to the project, the
anticipated project cash flow would yield a positive cash flow of approximately 4%. This
was well below the industry standard of 8% to 10% on housing projects. The Developer
agreed to accept 3% as their base profit, and share equally with the Agency any cash flow
above the 3% of gross revenues.
These were the essential fundamental deal points approved by the Community Development
Commission on January 7, 2002.
On January I, 2002, changes occurred in the California Redevelopment Law that affect the
manner in which the Amendment No.2 was structured. Consequently, in order to be in
compliance with the new laws, Staff, Agency Special Counsel and Developer met to restructure
the DDA. As such, the following represents the restructured business points in the Second
Amended and Restated Disposition and Development Agreement:
. The Agency will sell the land (38 single family lots) to the Developer at the AS IS fair
market value of $1 00,000 established by the appraisal for the property;
. The Agency will forgive the $229,000 debt (two Promissory Notes) from the Phase I
development of24 homes and the sale of the single family home at Susie Lane. This debt
under the two Promissory Notes represents funds which the Agency used from
Low/Moderate Income Housing Fund for the original purchase of the Phase 1 property
and Susie Lane;
. The Agency will contribute $481,400 to the Developer for the development on the Phase
II Property of eight (8) low/moderate income housing units (Affordable Housing Unit)
(i.e. for a family of four (4) the maximum income permitted under the 2002 state law is
$60,350) (the "Affordable Housing Construction Grant"). The Developer, Agency and
Affordable Housing buyer will be required to execute a Regulatory Agreement, which
requires that the housing unit remain affordable to an income eligible buyer for a period
of not less than 45 years from the date of purchase. The formula by which the Agency
Staff, Special Counsel and Developer have agreed to protect the Agency's Low/Moderate
GYO:MP:sj:4-1-02 Century Crowell
COMMISSION MEETING AGENDA
Meeting Date: 04/01/02
Agenda Item Number: ~
Economic Development Agency Staff Report
Century Crowell - Development of Agency Parcels
March 21, 2002
Page Number -3-
Income Housing Fund in the affordable housing unit is set forth in Exhibit H to the
Amendment No.2;
. The Developer will invest approximately $3 million for the development of the 38 single
family homes, including, but not limited to, the installation of curbs, gutters, streets,
sidewalks, sewer, storm drains, etc.;
. The Agency will commit, at a minimum, the balance (from Phase I) of $166,000 from the
Agency's Mortgage Assistance Program (MAP) funded through the Low/Moderate
Income Housing Fund to the Developer's qualified buyers to use the MAP loan funds for
down payment and closing costs. Based on the new state law, any buyer receiving
assistance under the MAP Program would be required to execute an affordability
covenant with a term of not less than 45 years. This Affordability Covenant will be
assumable by a Low/Moderate Income successor-in-interest to the original New Home
Buyer. Thus, provided the New Home Buyer remains in the New Home for the term of
the Affordability Period and there is no default, the MAP loan will be forgiven in
increments as follows: on the 10th anniversary date following the date of the Promissory
Note, the Agency will forgive one-half (\I,) of the original principal note amount.
Commencing on the 11th anniversary date of the Promissory Note and thereafter on each
succeeding anniversary date until maturity (45 years), the Agency will forgive one thirty-
fifth (1135) of the original principal amount. If the Home Buyer sells the New Home to a
non-income eligible successor-in-interest, then any unforgiven portion after remaining
principal balance of the MAP loan shall be payable to the Agency. *
*NOTE: It should be noted that Staff intends to use this same MAP forgiveness
formula for all homebuyers receiving assistance from the Agency's MAP when
using the low and moderate income housing fund. The Agency's MAP
documents such as the Promissory Note, Deed of Trust, Loan Agreement and
33334.3 Covenant will be revised, as approved by Agency Special Counsel, to
reflect the 45 year affordability period and the formula forgiveness clause
contained herein.
. The Developer will retain 3% as their base profit on the project, versus the going rate of
8-10% and share equally with the Agency any cash flow above the 3% gross revenues.
To the extent "profits" are realized on this project, the 50/50 sharing arrangement for
such profits between the Developer and the Agency will reduce the total net amount of
the Agency's Low/Moderate Housing Investment.
In conclusion, the proposed modifications to the text of the Amended and Restated Agreement
since the January 7, 2002 approval, as discussed in this Staff Report do not fundamentally
GYO:MP:sj:4-1-02 Century Crowell
COMMISSION MEETING AGENDA
Meeting Date: 04/01/02
Agenda Item Number: -83a-
-
.
Economic Development Agency Staff Report
Century Crowell - Development of Agency Parcels
March 21, 2002
Page Number -4-
change the Agency's original financial contribution to the project. The Amendment No.2 is
intended to enable the Agency to meet the requirements of the new legislation effective January
2002.
The sale and the redevelopment of the Property is expected to generate a minimum of $40,000 in
annual new tax increment revenues to the Agency. Moreover, the sale of the Site and sale of the
38 new homes will create homeownership opportunities for City residents who will invest their
resources in the City of San Bernardino.
ENVIRONMENTAL IMPACT:
The Project Site is in the Northwest Redevelopment Project Area and a final subdivision map for
the Project has also been recorded; therefore, pursuant to the provisions of Title 14, California
Code of Regulation, Section 15180, no further review of the potential effects of development per
the Amendment No.2 is required under CEQA.
FISCAL IMPACT:
The actual cash contribution to the project from the Agency is $481,400. These funds will come
solely from the Agency's Low/Moderate Income Housing Fund 2001-2002 and 2002/2003
budget. In addition, the Agency will forgive the $229,000 Low/Moderate Income Housing Fund
Promissory Notes for the Phase I development and Susie Lane. As a result of the new Phase II
development, the Agency anticipates that the project will generate an estimated $40,000 in new
annual tax increment revenue to the project area.
RECOMMENDATION:
ThS:;-;~'doPtth, ,""""""",tuti"
Maggie Pacheco, Deputy DirectorIDirector
Housing & Community Development
GVO:MP:sj:4-I-02 Century Crowell
COMMISSION MEETING AGENDA
Meeting Date: 04/01/02
Agenda Item Number: R3Q.
r
e
e 13
14
e 25
.~0' r:-~, '\II)'
,~~ujLf
RESOLUTION NO.
2
3
RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION
OF THE CITY OF SAN BERNARDINO APPROVING AND
AUTHORIZING THE AGENCY EXECUTIVE DIRECTOR TO EXECUTE
THE SECOND AMENDED AND RESTATED DISPOSITION AND
DEVELOPMENT AGREEMENT, (THE "AMENDMENT NO.2") BY AND
BETWEEN THE REDEVELOPMENT AGENCY AND CENTURY
CROWELL COMMUNITIES, L.P., ("DEVELOPER") - DEVELOPMENT
OF 38 PARCELS LOCATED WITHIN THE NORTHWEST
REDEVELOPMENT PROJECT AREA
4
5
6
7
8
WHEREAS, the Redevelopment Agency of the City of San Bernardino (the "Agency")
owns or has a beneficial interest in certain subdivided lands referred to in this Resolution
9
10
collectively as the "Site" which is situated within the redevelopment project area of the
Northwest Redevelopment Project Area described as: Lots No. I through 38 Subdivision Tract
Map No. 13822 ( the "Phase II Site"); and
WHEREAS, the City of San Bernardino (the "City") acquired the Phase II Site from
Dukes-Dukes and Associates, which said agreement was cancelled following the approval of an
"Agreement for Relinquishment of Rights and Forgiveness of Obligations" (the "Relinquishment
Agreement") dated as of February 21, 1994 by and between Dukes-Dukes and Associates and
the Agency; and
WHEREAS, subsequent to the Relinquishment Agreement, the Agency entered into an
Exclusive Right to Negotiate for Property Acquisition and Redevelopment Assistance on
February I, 1999, and thereafter on July 19, 1999, the Disposition and Development Agreement
(the "DDA") with Century Crowell Communities, L. P., a California limited partnership (the
"Developer") and as subsequently amended on December 4,2000, (the "Amendment No.1") for
development of Phase I consisting of twenty four (24) single family homes, and thereafter an
amendment to the DDA ( the "Amendment No.2) dated January 7, 2002, for the development 0
thirty-eight (38) single family homes under certain terms and conditions set forth in the
Amendment No.2; and
II
12
15
16
17
18
19
20
21
22
23
24
-1-
e~
_13
-14
e 25
3
WHEREAS, after the Community Development Commission approved the January 7,
2002 Amendment No.2, certain changes occurred in the California Community Redevelopment
(the "Law") thai effect certain terms and conditions of the previously approved Amendment No.
2 and the parties desire to modify the Amendment No.2 (the Second Amended and Restated
Disposition and Development Agreement, commonly referred to Amendment No.2) to reflect the
current changes in the Law as it pertains to the redevelopment and ultimate disposition of the
4
5
6
7
Phase II Site;
WHEREAS, the Agency and Developer have restructured the pertinent business terms in
the Amendment No.2 to effectuate the revisions in the Law which said revisions due not change
8
9
the monetary contribution to the Phase II Site Project; and therefore, the revisions, due not result
in further significant fiscal impact to the Agency; and
WHEREAS, the Agency desires to contribute the sum of $481 ,400 , or $60,175 per
housing unit ( the "Affordable Housing Construction Grant"), from its Low/Moderate Income
Housing Fund ( the "Housing Fund") to the Developer for the development of eight (8)
affordable single family homes ( the "Affordable Housing Units") for first time low/moderate
income buyers and said buyers will be required to sign a forty-five (45) year Affordability
10
11
12
15
16
Covenant in accordance with the new Law; and
17
WHEREAS, the Agency finds that the Affordable Housing Construction Grant to the
Developer for development of the Affordable Housing Units is in excess of fifty percent (50%)
18
19
of the total development costs per unit basis, but the Agency finds it necessary and appropriate
20
to contribute such amount in order to make the project economically feasible and to provide
affordable housing opportunities for low and moderate income households as required under
Health and Safety Code 33334.2 and use of the Agency's Housing Fund is appropriate and
consistent with the provisions of the law.
WHEREAS, it is appropriate for the Commission to take the actions as it pertains to the
revised Amendment No.2 and approve the Amendment No.2 as set forth in this Resolution.
21
22
23
24
-2-
e2
A13
-14
e25
3
NOW, THEREFORE, THE COMMUNITY DEVELOPMENT COMMISSION ACTING
ON BEHALF OF THE REDEVELOPMENT AGENCY OF THE CITY OF SAN
BERNARDINO DO HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS:
4
Section 1.
On January 7, 2002, Commission conducted a full and fair joint public
5
hearing with the Mayor and Comnion Council of the City of San Bernardino relating to the
disposition and redevelopment of the Phase II Site by the Developer pursuant to the terms and
conditions of the Amendment No.2. The minutes of the Agency Secretary for the January 7,
2002 meeting of the Commission include a record of all communication and testimony submitted
to the Commission by interested persons relating to the joint public hearing, the 33433 Summary
Report and the approval of the Amendment No.2.
Section 2. On April!, 2002, the Commission reconsidered the Amendment No.2 to
take into consideration the changes in the Law that affect the previously January 7, 2002
approved business terms noted in the Amendment No.2. The Commission hereby approves the
revised Amendment No.2 in the form attached to this Resolution. The Commission hereby finds
and determines that the Amendment No.2 will result in the following benefits and findings:
6
7
8
9
10
11
12
15
(I)
the disposition and redevelopment of the Phase II Site by the Developer in
accordance with the Amendment No.2 is consistent with the Redevelopment Plan
for the Northwest Redevelopment Project Area and the Agency Implementation
Plan;
16
17
18
19
(2)
the terms and conditions of the Amendment No.2 contain assurances that the
20
Developer will develop thirty eight (38) new single family homes of which the
Developer has agreed to use the Affordable Housing Participation Fee to
construct not less than eight (8) single family homes for low/moderate income
housing buyers whose incomes do not exceed one hundred and twenty percent
(120%) of the area median income of the City as specifically defined in the
Amendment No.2 and that the provision of the Agency Housing Participation Fee
will be paid to the Developer solely from the Agency's Housing fund. Moreover,
21
22
23
24
-3-
e 2
3
4
5
6
7
8
9
10
11
12
e 13
14
15
16
17
18
19
20
21
22
23
24
e 25
the Agency's Housing Participation Fee is necessary to make the development of
the Affordable Housing Units economically viable and feasible.
(3) the purchase price for the Site payable by the Developer to the Agency, subject to
the satisfaction of the terms and conditions of the Amendment No.2 is an amount
which the Commission declare to be fair market value as per the findings made by
Mayor and Common Council Resolution adopted and approved on January 7,
2002, and the disposition of the Phase II Site on the terms set forth in the
Amendment No.2 shall materially benefit and sustain the implementation of the
Redevelopment Plan and assist the community in increasing the supply of
affordable single family residential dwelling units available to persons and
households of a low and moderate income.
Section 3. The Commission hereby finds and determines that no further
Environmental review by the Agency for the disposition and redevelopment of the Phase II Site
of the Developer pursuant to the terms and conditions of the Amendment No.2 is necessary at
this time under the California Environmental Quality Act (CEQA), as amended, in light of
following facts: (I) the final subdivision Tract Map 13822 for the Phase II Site have previously
been recorded and the redevelopment of the Phase II Site by the Developer pursuant to the
Amendment No.2 will not require any revisions or changes in the approved subdivision tract
maps for the Phase II Site; and (2) the redevelopment of the Phase II Site by the Developer
pursuant to the Amendment No.2 does not involve any new significant increase in the severity
of previously identified environment effects which were not previously considered as part of the
approval of the subdivision tract maps for the Phase II Site; and (3) the Phase II Site are situated
in the redevelopment project area ofthe Northwest Redevelopment Project and by virtue of the
facts set forth in subparagraph (1) and (2)above, pursuant to the provisions of Title 14, California
Code of Regulation Section 15180, no further review of the potential effect of the redevelopment
of the Phase II Site in accordance with the Amendment No.2 is required at this time under
CEQA and the final EIR for the Northwest Redevelopment Project Area.
-4-
e 2
3
4
5
6
7
8
9
10
11
12
e 13
14
15
16
17
18
19
20
21
22
23
24
e 25
Section 4. The Commission desires to contribute the sum of$481,400 ,or $60.175
per housing unit ( the "Affordable Housing Construction Grant"), from its LowlModerate
Income Housing Fund ( the "Housing Fund") to the Developer for the development of
eight (8) affordable single family homes ( the "Affordable Housing Units") for first time
low/moderate income buyers and said buyers will be required to sign a forty-five (45)
year Affordability Covenant (Exhibit "H") (the "33334.3 Covenant") in accordance with
the new Law. The Commission finds that the Affordable Housing Construction Grant to
the Developer for development of the Affordable Housing Units is in excess of fifty
percent (50%) of the total development costs per unit basis, and the Commission finds it
necessary and appropriate to contribute such amount in order to make the project
economically feasible and affordable for low and moderate income households as
required under Health and Safety Code 33334.3, and use of the Agency's Housing Fund
is appropriate and consistent with the provisions of the law. The Commission hereby
approves the disposition of the Phase II Site at the fair market value, the Affordable
Housing Construction Grant of $48 1,400 for the provision of eight (8) affordable
Housing Units, and the forgiveness of the $229,000 debt owed by the Developer to the
Agency for Phase I (24 homes) in accordance with the provisions of Amendment No.1 to
the DDA.
Section 5. The Executive Director of the Agency ("Executive Director") is hereby
authorized and directed to execute the Amendment No.2 on behalf of the Agency
together with such technical and conforming changes as may be recommended by the
Executive Director and approved by the Agency Counsel in order to consummate the sale
of the Phase II Site and redevelopment of the project. The signatures of Executive
Director on the Amendment No.2 shall provide conclusive evidence that the Amendment
No.2 has taken effect.
-5-
-2
10 IIII
11 IIII
12 IIII
_ 13 IIII
14 IIII
15 IIII
16 IIII
17 IIII
18 IIII
19 IIII
20 IIII
21 IIII
22 IIII
23 IIII
24 IIII
_ 25 IIII
3
4
5
6
7
8
9
Section 6. Provided that the Amendment No.2 has been fully executed by the panies
to the Amendment No.2, the Executive Director is hereby authorized and directed to take all
actions set forth in the Amendment No.2 on behalf of the Agency to close the escrow transactio
described therein. The Executive Director is further authorized and directed to execute an
acknowledgement of acceptance of transfer of title of the Phase II Site from the City, if
necessary, pursuant to the Resolution of the Mayor and Common Council dated January 7, 2002,
and to execute the final form of the Agency Grant Deed transferring title in the Phase II Site
from the Agency to the Developer upon satisfaction of the applicable conditions for the close of
the escrow set forth in the Amendment No.2 of even date herein.
-6-
12 MCGINNIS
13 DERRY
e 14 SUAREZ
15 ANDERSON
16 MC CAMMACK
17
e 2
,
J
4
5
6
7
8
9
10
II
_27
_28
RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION
OF THE CITY OF SAN BERNARDINO APPROVING AND AUTHORIZING
THE AGENCY EXECUTIVE DIRECTOR TO EXECUTE THE SECOND
AMENDED AND RESTATED DISPOSITION AND DEVELOPMENT
AGREEMENT, (THE "AMENDMENT NO.2") BY AND BETWEEN THE
REDEVELOPMENT AGENCY AND CENTURY CROWELL
COMMUNITIES, L.P., ("DEVELOPER") - DEVELOPMENT OF 38
PARCELS LOCATED WITH THE NORTHWEST REDEVELOPMENT
PROJECT AREA
I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Community
Development Commission of the City of San Bernardino at a
meeting thereof. held
on the _ day of
, 2002, by the following vote to wit:
Commission Members:
Navs
Abstain
Absent
Am
ESTRADA
LIEN
18
19
Secretary
The foregoing resolution is hereby approved this _ day of
,2002.
20
21
22
Judith Valles, Chairperson
Community Development Commission
l' A i
~J pprove 'a
25
. Content:
24 By: _ I
Agency Counsel
26
-7-
e
e
e
SECOND AMENDED AND RESTATED
DISPOSITION AND DEVELOPMENT AGREEMENT
BY AND BETWEEN
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
AND
CENTURY CROWELL COMMUNITIES, L.P.
a California Limited Partnership
APRIL 1, 2002
882002:2242.4
e
e
e
TABLE OF CONTENTS
Page
TERMS AND CONDITIONS........................................... 1
Section 1.01. Purpose of Agreement ............................ 1
Section 1.02. The Site........................................ 2
Section 1.02.1 Single Family Home ............................. 2
Section 1.03. Parties to the Agreement ........................ 2
Section 1.04. Prohibition Against Change in Ownership,
Management and Control of Developer and
Assignment of Agreement................ ...... ...2
Section 1. 05. Benefit to Project Areas........................ 4
ARTICLE II
DISPOSITION OF SITE ...................................... 4
Section 2.01. Purchase and Sale of the Site ................... 4
Section 2.01.2. Additional Consideration......... ........ .....4
Section 2.01.5 Definition of Purchase Price........ ....... .....6
Section 2.02. Payment of Purchase Price; Application or Return
of Deposit...................................... 6
Section 2.03. Opening and Closing of Escrow... ................9
Section 2.04. Escrow Instructions ............................ 10
Section 2.05. Conveyance of Title ............................ 11
Section 2.06. Additional Closing Obligations of Agency....... 12
Section 2.07. Closing Obligations of Developer .... ...... .....13
Section 2.08. Inspections and Review......................... 13
Section 2.09. Due Diligence Investigation of the Site.... ....16
Section 2.10. Due Diligence Approval Certificate ........ .....17
$B2002,2242.4
- i -
e
e
e
Section 2.11. Books and Records.............................. 17
Section 2.12. Condition of the Site; Developer's Release. ...17
Section 2.13. Review and Approval of Condition of Title by the
Developer. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ., 19
Section 2.14. Survey......... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 2.15. Extension of Due Diligence Period.............. 21
Section 2.16. Developer's Conditions Precedent............... 21
Section 2.17. The Agency's Conditions Precedent........... ...22
Section 2.18. Delivery of Documents and Purchase Price After
Closing Date by Escrow Holder... ......... ......23
Section 2.19. Satisfaction of Conditions ..................... 23
Section 2.20. Termination. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 2.21. Prorations, Closing Costs, Possession.......... 24
Section 2.22. BREACH OF ARTICLE II BY THE AGENCY; LIQUIDATED
DAMAGES PAYABLE BY THE AGENCY TO THE DEVELOPER. 26
Section 2.23. BREACH BY THE DEVELOPER OF ARTICLE II; LIQUIDATED
DAMAGES PAYABLE BY THE DEVELOPER TO THE AGENCY. 27
Section 2.24. Representations and Warranties ............ .....27
Section 2.25. Damage, Destruction and Condemnation.. .........31
ARTICLE III
DEVELOPMENT OF THE SITE .................................. 31
Section 3.01. Development by Developer ................ .......31
Section 3.02. [RESERVED -- NO TEXT] ..........................39
Section 3.03. Taxes, Assessments, Encumbrances and Liens.. ...39
Section 3.04. Prohibition Against Transfer................... 39
Section 3.05. Security Financing; Right of Holders ..... ......40
SB2002:2242.4
- ii -
e
e
e
Section 3.06. Right of the Agency to Satisfy Other Liens on the
Site after Conveyance of Title...... '" ........44
Section 3.07. Certificates of Completion ..................... 44
ARTICLE IV
USE OF THE SITE.......................................... 45
Section 4.01. Uses........................................... 45
Section 4.02. Maintenance of the Site ........................ 46
Section 4.03. Obligation to Refrain from Discrimination. .....47
Section 4.04. Form of Nondiscrimination and Nonsegregation
Clauses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Section 4.05. Effect and Duration of Covenants.... ...........48
ARTICLE V
DEFAULTS, REMEDIES AND TERMINATION....................... 49
Section 5.01. Defaults - General............................. 49
Section 5.02. Legal Actions.................................. 50
Section 5.03. Rights and Remedies are Cumulative............. 50
Section 5.04. Damages. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Section 5.05. Specific Performance................... ........50
Section 5.06. Agency Rights of Termination Following Close of
Escrow. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Section 5.07. Right to Reenter, Repossess and Revest...... ...52
ARTICLE VI
GENERAL PROVISIONS ....................................... 54
Section 6.01. Notices, Demands and Communications Between the
Parties. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
Section 6.02. Conflict of Interest........................... 55
582002:2242.4
- iii -
e
e
e
Section 6.03. Warranty Against Payment of Consideration for
Agreement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Section 6.04. Nonliability of Agency Officials and Employees
55
Section 6.05. Enforced Delay: Extension of Time of Performance
56
Section 6.06. Inspection of Books and Records................ 57
Section 6.07. Approvals...................................... 57
Section 6.08. Real Estate Commissions ........................ 57
Section 6.09. Indemnification..... . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Section 6.10. Release of Developer from Liability... .........57
Section 6.11. Attorneys' Fees ................................ 58
Section 6.12. Effect...... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
ARTICLE VII
ENTIRE AGREEMENT, WAIVERS AND AMENDMENT .................. 58
Section 7.01. Entire Agreement ............................... 58
ARTICLE VI II
TIME FOR ACCEPTANCE OF AGREEMENT BY AGENCY AND RECORDATION
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Section 8.01. Execution and Recordation...................... 59
EXHIBIT "A"
LEGAL DESCRIPTION
SITE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Exh. "An - 1
EXHIBIT "B"
AGENCY GRANT DEEDS I AND II . . . . . . . . . . . . . . . . . . . . Exh. "C" - 1
EXHIBIT "C"
SCOPE OF DEVELOPMENT
.............................................. .
Exh. "D" - 1
5B2002:2242.4
- iv -
e EXHIBIT "0"
SCHEDULE OF PERFORMANCE
. . . . . . . . . . . . . . . .'. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. Exh. "E" - 1
EXHIBIT "E" . . . . .. .. .. .. . . . .. . . .. . . .. .. .. .. .. .. .. . . . . Exh. "F" - 1
EXHIBIT "F"
COMMUNITY REDEVELOPMENT HOUSING AFFORDABILITY
COVENANTS AND RESTRICTIONS..................... Exh. "G" - 1
e
e
SB2002,2242.4
- v -
e
e
e
THIS SECOND AMENDED AND RESTATED DISPOSITION AND
DEVELOPMENT AGREEMENT (this "AMENDMENT NO.2") is entered into
as of April __, 2002, by and between the REDEVELOPMENT AGENCY OF
THE CITY OF SAN BERNARDINO, a public body corporate and politic
(the "Agency") and CENTURY CROWELL COMMUNITIES, LP, a California
limited partnership (the "Developer").
RECITALS
A. WHEREAS, the Agency and the Developer entered into the
original Disposition and Development Agreement (the "Original
DDA") on July 19, 1999; and as subsequently amended and restated
under First Amended and Restated Disposition and Development
Agreement entered into as of December 4, 2000, ("Amendment No.
1 ") ;
B. WHEREAS, the Agency and the Developer now desire to enter
into this Amendment No. 2 in order to set forth the terms and
condi tions on which the parties have agreed to provide for the
transfer, redevelopment and reuse by the Developer of the "Phase
I Lots", as this term is defined in Section 2.01. 2 of Amendment
No.1; and
C. WHEREAS, this Amendment No. 2 shall, upon execution, amend
and supersede the Original DDA and Amendment No. 1 with respect
to the transfer, redevelopment and reuse by the Developer of the
Phase II Lots as set forth in this Amendment No.2.
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:
TERMS AND CONDITIONS
Section 1.01. Definition of Terms, Purpose of
Agreement and Integration of All Agreements Relating to the
Phase II Lots and Use of Two (2) Lots as Models on Phase I Lots.
(a) The usage of defined terms and phrases as used in
this Amendment No. 2 shall have the meaning as set forth in
this Amendment No.2, and unless otherwise provided in this
Amendment No.2, each such defined term or phrase shall have a
meaning which is distinct and separate from the usage of such
term or phrase as may be set forth in Amendment No.1. The
purpose of this Amendment No. 2 is to effectuate various
redevelopment plans of the Agency by making available affordable
housing for low- and moderate-income homebuyers and to cause the
582002:2242.4
2
e
e
e
residential development of a thirty eight (38) lot single family
housing tract (the "Site"). This Amendment No. 2 integrates all
of the terms and conditions mentioned herein and supercedes all
provisions of the Original DDA and Amendment No. 1 with respect
to the "Phase II Lots", as this term is defined in Section
2.01.2 of Amendment No. 1. As used in this Amendment No.2 the
word "Site" means and refers to the same lands which were
described in Amendment No.1 as the "Phase II Lots".
The Site is situated within the redevelopment project
area of the Northwest Redevelopment Project in the City of San
Bernardino, California (the "City"). A legal description of the
Site is attached hereto as Exhibit "A" and incorporated herein
by this reference. The development of the Site pursuant to this
Amendment No. 2 is in the vital and best interests of the City
and the health, safety and welfare of its residents, and in
accord with the public purposes and provisions of applicable
state and local laws. The Agency has determined that the
development and uses contemplated by this Amendment No. 2 will
benefit the low- and moderate-income housing needs of the City
as well as the various redevelopment project areas of the City.
(b) Notwithstanding any other provisions of Amendment
"No. 1 to the contrary, and subj ect to the compliance by the
Developer with all applicable merchant-builder subdivided land
sales business regulations of the City of San Bernardino, the
Developer is hereby authorized to continue to use the two (2)
improved residential lots in the Phase I Site more particularly
identified in Exhibit "A-2", attached hereto, as "model homes"
for the purpose of the marketing and sale of each of the
improved Phase II Lots to "New Home Buyers", as this term is
defined in Section 3.01 hereof; provided however, that the
Developer shall discontinue the use of such improved residential
lots in the Phase I Site as model homes for the market and sale
of the improved Phase II Lots on the first of the following
dates to occur: (i) June 30, 2005; or (ii) thirty (30) days
following the close of the final "New Home Escrow", as this term
is defined in Section 3.01(a). Provided that the City has
approved the continuation of the use of the model homes by the
Developer after the occurrence of the applicable date specified
in (ii) of the preceding sentence, the Developer may continue to
use the model homes for the purpose of marketing and sale of
other subdivided lands owned or controlled by the Developer in
the redevelopment project area of the Northwest Redevelopment
Project.
Dollars
(c) The
($229,000)
Hundred Twenty Nine Thousand
and payable by the Developer to
sum of Two
is now due
SB2002:2242.4
3
e
e
e
the Agency under the terms of "Promissory Note I" and
"Promissory Note II", as these terms are defined in Amendment
No.1. The Agency hereby agrees to forebear from the collection
of the sums now due under Promissory Note I and Promissory Note
II until August 31, 2002. Provided that the Developer is not in
material default of any provision of this Amendment No. 2 and
further provided that the "Escrow" established under Section
2.03 of this Amendment No.2 is closed by a date not later than
August 31, 2002, subject to the time extensions authorized
herein for the "Closing of Escrow", as hereafter defined in
Section 2.03, below, the Agency shall discharge, waive and
forgive the payment by the Developer of the sums due the Agency
under Promissory Note I and Promissory Note II. At the Closing
of Escrow, the Agency shall deliver to the Developer the
original copy of Promissory Note I and Promissory Note II, each
endorsed by the Agency as discharged, waived and forgiven.
Section 1. 02. The Si te and Scope of Development. The
Site, which is designated as Subdivision Tract Map No. 13822,
consists of a total of THIRTY-EIGHT (38) buildable subdivided
lots. Each lot in the Site, shall be referred to hereafter as a
"Site Lot". Promptly following the Closing of Escrow, the
Developer shall undertake the development, improvement,
marketing and sale of single-family detached residential homes
on each Site Lot in accordance with the Scope of Development
attached hereto as Exhibit "B". The provisions of this
Amendment No. 2 are applicable to the Site in its entirety.
Section 1.03.
Parties to the Agreement.
la) The Agency. 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 33020, et ~.) 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 Century Crowell
Communi ties, L. P. , a California limited partnership. The
principal office and mailing address of the Developer for
purposes of this Restated Agreement is: 1535 South "D" Street,
Suite 200, San Bernardino, California 92408.
Section 1.04. Prohibition Against Change in
Ownership, Management and Control of Developer and Assignment of
Agreement. The qualifications and identity of the Developer are
of particular concern to the Agency. It is because of those
582002:2242.4
4
e
e
e
qualifica tions and identity that the Agency has
this Amendment No. 2 with the Developer. No
involuntary successor in interest of the Developer
any rights or powers under this Amendment No.
expressly set forth herein.
entered into
voluntary or
shall acquire
2 except as
Except as set forth in Section 3.04, the Developer
shall not assign all or any part of this Amendment No. 2 or any
rights hereunder prior to the issuance of the final Certificate
of Completion 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
writing 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 Amendment No. 2
may be terminated by the Agency prior to the Close of Escrow as
set forth in Section 2.03 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) 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 Close of Escrow and prior
to issuance of the final Certificate of Completion such a
material change in the ownership, or control of the Developer
occurs with respect to the Site; provided, however, that (A) the
Agency shall first notify the Developer in writing of its
intention to terminate this Amendment No. 2 Agreement or assert
any other such remedy, and (E) the Developer shall have twenty
(20) calendar days following its receipt of such written notice
to commence and thereafter diligently and continuously proceed
wi th the cure of the default of the Developer hereunder and
submit evidence of the initiation of satisfactory completion of
such cure to the Agency in a form and substance deemed
satisfactory to the Agency, in its reasonable discretion.
For the purpose of this Section 1.04 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
SB2002:2242.4
5
e
forty-nine percent (49%) interest of the ownership of the
Developer.
Section 1. 05. Benefit to Proj ect Areas. The Agency
has determined that the disposition and development of the Site
to Developer in accordance with this Amendment No. 2 will
eliminate blight and provide needed low- and moderate-income
housing to the Northwest Redevelopment proj ect 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 1.06. List of Exhibits to Amendment
The following is a listing of the Exhibits attached
Amendment No.2. Each such exhibit is incorporated by
this reference into the text of this Amendment No.2:
No.2.
to this
this by
EXHIBIT "A"
Legal Description of the Site
EXHIBIT "A-1"
Legal Description of Two Model Home
Lots on the Phase I Site
e EXHIBIT "BIf
EXHIBIT "elf
EXHIBIT "D"
EXHIBIT "E"
Scope of Development (Section 1.02)
[RESERVED - NO TEXT]
Form of Agency Grant Deed
Form of Temporary License Agreement for
the Grading of Land
EXHIBIT "F"
Schedule
3.01 (f) )
of
Performance
(Section
EXHIBIT "G"
Form of Certificate
(Section 3.07)
of
Completion
EXHIBIT "H"
Affordable Housing Regulatory Agreement
(Section 4.01)
EXHIBIT "I"
Notice of Agreement (Section 8.01)
ARTICLE II
DISPOSITION OF SITE
e
Section 2.01. Purchase and Sale of the Site. Subject
to all of the terms, conditions and provisions of this Amendment
No.2, and for the consideration of the payment of the Purchase
SB2002:2242.4
6
e
e
e
Price by the Developer to the Agency for the Site as herein set
forth, the Agency hereby agrees to sell and the Developer hereby
agrees to purchase all of the right, title and interest of the
Agency in the Site.
Section 2.01.2 Purchase Price for the Site. The
Agency agrees to sell the Site and the Developer agrees to
purchase the Site in an AS IS CONDITION and at its fair market
value of ONE HUNDRED THOUSAND DOLLARS ($100,000) in United
States currency (the "Site Purchase Price").
Section 2.01.3.
Housing
Sales
Affordable
Grant.
(a) In order to facilitate the redevelopment of the
Site as affordable single family housing in accordance with the
Scope of Development, and in consideration of the payment by the
Developer to the Agency of the "Affordable Housing Participation
FeeN, as set forth in Section 2.01.4(9), the Agency hereby
agrees to grant to the Developer a sum (the "Affordable Housing
Sales GrantN) in an aggregate amount not to exceed One Hundred
Eighty One Thousand Four Hundred Dollars ($481,400).
(b) The Affordable Housing Sales Grant shall be
disbursed to the Developer by the Agency in eight (8) equal
installments of Sixty Thousand One Hundred Seventy Five Dollars
($60,175) . Provided the Developer is not. in material default
under this Amendment No.2, each such installment shall be
disbursed to the Developer on the applicable "Delivery DateN for
the close of the "New Horne EscrowN for the transfer of the
completed "New HomeN to the Qualified Horne Buyer, as each of
these terms are defined in Section 3.01(a).
(c) The Developer shall give the Agency at least
twenty (20) days prior written notice of the date on which the
Developer believes the Delivery Date of the New Horne to the
Qualified Horne Buyer shall occur. Such written notice shall
reference this Section 2.01.3 and contain the following
information:
(1) a statement by the Developer that the New Horne
has been constructed in accordance with the Scope
of Development, is complete (or shall be
completed by the close of the New Horne Escrow)
and is ready for occupancy, subj ect only to the
close of the New Horne Escrow;
SB2002:2242.4
7
e
e
e
(2 )
the name of the Qualified Home Buyer and a
statement of the Developer that the Qualified
Home Buyer satisfies the income eligibility
requirements set forth in Section 4.01;
(3) a full and complete copy of the purchase money
mortgage loan application and borrower
qualification documents submitted by the
Qualified Home Buyer to the mortgage lender
selected by such Qualified Home Buyer to provide
the mortgage loan to the Qualified Home Buyer for
the purchase of the New Home (including without
limitation tax return information, proof of
employment and other borrower financial
informa tion required by such purchase money
mortgage lender);
(4 )
a statement signed by the Qualified Home Buyer
that it has received a copy of the Affordability
Housing Regulatory Agreement from the Developer
and that the Qualified Home Buyer understands and
accepts its terms, subj ect only to the close of
the New Home Escrow.
(d) Each installment of the Affordable Housing Sales
Grant shall be paid to the Developer by the Agency through the
applicable New Home Escrow by and between the Developer and the
Qualified Home Buyer. The Agency shall cause each such
installment of the Affordable Housing Sales Grant in immediate
funds to be delivered to the Escrow Holder by no later than the
business day preceding the Deli very Date for the applicable New
home Escrow for disbursement to the Developer in accordance with
the written disbursement instructions of the Agency addressed to
the Escrow Holder.
Participation
Section 2.01.4
Fee By Developer
Housinq
Payment of Affordable
to the Agency.
(a) The Affordable Housing Participation Fee is a sum
payable by the Developer to the Agency from a special source of
Developer funds described in this Section 2.01.4, to the extent
that such funds are available therefor as consideration for the
agreement by the Agency to contribute the Affordable Housing
Sales Grant to the Developer. The Affordable Housing
Participation Fee is a sum equal to one-half (1/2) of the
"Profi t of the Developer", as defined below. The Affordable
Housing Participation Fee shall be due and payable to the Agency
SB2002:2242.4
8
e
e
e
from the
Developer
Profit
upon the
of the Developer, if any,
occurrence of the following
by
the
realized
events:
(A) the sale, transfer, assignment or other
hypothecation of the interest of the Developer in
all or a portion of the Site Lots to a third
party, . other than to "New Home Buyers" as this
term is defined in Section 3.01(a), or except for
a permitted construction-related financing
authorized by Section 3.04; and/or
(B) within one hundred and twenty (120) days
following the close of the last "New Home Escrow"
as this term is defined in Section 3.01 la), for
the sale of all of the completed New Homes in the
Site and the Agency's receipt of the written
accounting described in Section 2.01.4(d),
provided however, the amount of the reasonable
New Home warranty reserve account established by
the Developer in an amount not to exceed $1,500
per New Home, shall be subject to distribution as
part of the Affordable Housing Participation Fee
as set forth in 2.01.4Ia) IC);
(C) within 400 days following the distribution of the
Affordable Housing Participation Fee as set forth
in Section 2.01.4(a) (B), the Developer shall
provide the Agency with a final accounting of the
unexpended balance of New Home warranty reserve
account for the Project, and if any balance may
then remain in such account, such balance shall
be deemed to be "Profit of the Developer".
(b) As used in this Section 2.01.4 the following
words and phrases shall mean:
SB2Q02:2242.4
"Profi.t of the Developer" means and refers to the
gross amount realized by the Developer, if any, upon
the sale or transfer of its interest in this Amendment
No. 2 or in the Site, after deducting the Project
Costs incurred by the Developer during the course of
the acquisition and development of the Site and after
deducting the Profit-Preference of the Developer, if
any, from the sale each completed New Home to a New
Home Buyer.
"Profi.t-Preference of the Developer" means and refers
to the sum of three percent 13%) of the gross sales
9
e
e
e
5B2002,2242.4
price of a completed New Home paid by a New Home Buyer
to the Developer at the close of each New Home Escrow.
"Project Costs" means and refers to the aggregate of
the following customary and commercially reasonable
costs incurred by the Developer in connection with the
acquisition and development of the Site:
IA) the Purchase Price of the Site payable to
the Agency;
(B) the cost of Site preparation;
(C) architectural, engineering, legal,
accounting, consulting, and other fees paid
in connection with the planning, execution
and financing of the development of the New
Homes on the Site including the cost of
furnishing the two (2) model homes described
in Section 1.01(b);
(D)
the costs of
surveys, plans
IC) above;
other necessary studies,
and permits not included in
(E) the cost of insurance, interest and
financing for the construction of the New
Homes, surety and completion bonds, property
taxes, and special assessment costs incurred
following the Close of Escrow during the
course of construction of the New Homes on
the Site;
IF) the cost of construction of the New Homes on
the Site net of the aggregate sum of the
Affordable Housing Sales Grant disbursed by
the Agency to the Developer;
(G)
the cost of all other improvements to
Site including landscaping, fencing,
preparation and utilities paid for by
Developer;
the
site
the
(H)
indirect costs of the
construction of the New
cost of a construction
construction security
services;
Developer for the
Homes, including the
superintendent, and
by private patrol
10
e
e
e
(I) moneys actually expended from the New Home
post sale warranty account established by
the Developer at the time of sale of each
New Home in an amount not to exceed $1,500
per each New Home;
(J) the cost of other extraordinary project-
related construction and/or marketing
expenses of the Developer approved by the
Executive Director in his reasonable
discretion which are based upon unusual or
unforeseen conditions associated with the
completion of the Project;
(K) A New Home sales commission payable to the
Developer of two percent (2%) of the gross
sales price paid by a New Home Buyer for
each completed New Home, plus the New Home
sales marketing and advertising costs paid
by the Developer, plus the costs payable by
the Developer as escrow costs, fees and
charges to the escrow agent who administers
each New Home Escrow upon the sale of each
New Home to a New Home Buyer, plus real
estate sales commissions paid by the
Developer, if any, to third party real
estate brokers at the time of sale of each
New Home;
(L) A developer fee payable to the Developer of
five percent (5%) of the gross sales price
to a New Home Buyer of each completed New
Home.
(c) From and after the Close of Escrow until the
Affordable Housing Participation Fee is paid in full to the
Agency, the Developer shall provide the Agency with the
following financial reports relating to the Site:
(i)
wi thin 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,
SB2002:2242.4
11
e
e
e
and quarterly profit and loss statement, and
schedule of cash flows and a weekly sales
report for New Homes, as applicable; and
(ii)
wi thin one hundred twenty (120) days after
the end of each fiscal year, an annual
unaudited financial statement, prepared by
the Developer for the proj ect at the Site,
or, if obtained by the Developer, an audited
financial statement.
(d) At the times indicated in Section 2.01.4 (a) (A) or
(8) the Developer shall provide the Agency with a suitably
detailed written accounting prepared in accordance with
generally-accepted accounting principals of the amount of the
Affordable Housing Participation Fee which is due and payable to
the Agency pursuant to this Amendment No.2. The Agency shall
have the right to inspect the business and financial records of
the Developer as related to these calculations and verification
of the amount of the Affordable Housing Participation Fee as may
be payable to the Agency, if any. 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
recording provided by the Developer to the Agency for
inspection.
Section 2.02. Developer Deposit, Payment of Purchase
Price; Application or Return of Deposit.
(a) Within five (5) calendar days following the full
execution of this Amendment No. 2 by the parties, the Developer
shall deposit the sum of Twenty Five Thousand Dollars
($25,000.00) (the "Deposit") with Orange Coast Title Insurance
Company ("Escrow Holder"), Escrow #R-1171MCA (the "Escrow").
The Escrow Holder shall invest the Deposit in an interest-
bearing escrow account at the written instruction of the
Developer with the interest thereon to accrue to the benefit of
the Developer. At the Close of Escrow, the Deposit, together
with all interest earned thereon, less costs of closing payable
by Developer, shall be applied to the Site Purchase Price, or as
further provided for under this Amendment No.2.
(b) In the event that (i) the Agency or the Developer
terminates this Amendment No.2 pursuant to Section 2.20; or
(ii) the Developer does not deliver its Due Diligence Approval
Certificate (as hereinafter defined) to the Escrow Holder
SB2002:2242.4
12
e
e
e
pursuant to Section 2.10 and this Amendment No.2 is terminated;
or (iii) the Developer's conditions precedent to the Close of
Escrow described in Section 2.16 are not satisfied (unless
satisfaction has been waived by the Developer as evidenced by
the Developer's entry onto the Site under the terms of Section
2.21(b)(A) or Section 2.21(b)(B) and the Temporary License
Agreement for the Grading of Land set forth in Section
2.21 (b) (B)) and this Amendment No. 2 is terminated; or (iv)
either the Site suffers damage prior to the Close of Escrow, or
an action of eminent domain is commenced by a governmental
entity with respect to the Site prior to either the Developer's
entry onto the Site under the Temporary License Agreement for
the Grading of Land or the Close of Escrow, whichever dated
first occurs, and the Developer elects to terminate this
Amendment No.2 pursuant to Section 2.25, then the Deposit (less
an amount equal to the customary and reasonable escrow
cancellation charges of the Escrow Holder) shall be returned to
the Developer.
Section 2.03. Openinq and Closing of Escrow.
(a) The transfer and sale of the Site shall take
place through the Escrow to be administered by the Escrow Holder
(Orange Coast Title Insurance Company: Escrow Department or
such other escrow or title insurance company mutually agreed
upon by the Developer and the Agency). Notwi thstanding the
actual date of the opening of the Escrow, .the Escrow shall be
deemed open ("Opening of Escrow") upon delivery of the Deposit
by the Developer, and a fully executed copy of this Amendment
No. 2 to the Escrow Holder. The Escrow Holder shall promptly
confirm to the parties the escrow number and the title insurance
order number assigned to the Escrow.
(b) In the event that the Developer has not delivered
its Due Diligence Approval Certificate to the Agency and the
Escrow Holder within sixty (60) days from the Opening of Escrow
for any reason, then in such event this Amendment No. 2 shall
terminate upon written notice to the Escrow Holder from either
the Agency or the Developer, whereupon the Deposit shall be
returned by the Escrow Holder to the Developer (less an amount
equal to the customary and reasonable escrow cancellation
charges payable to the Escrow Holder) without further or
separate instruction to the Escrow Holder, and the parties shall
each be relieved and discharged from all further responsibility
or liability under this Amendment No.2.
(c) Provided that the Developer has delivered its Due
Diligence Approval Certificate within the period of time
5B2002:2242.4
13
e
e
e
authorized in Section 2.03(b), then the Closing Date of the
Escrow shall occur within sixty (60) 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 Escrow Holder is in receipt of all
necessary documents and the Escrow Holder is in a position to
comply with the final written instructions of the parties and
cause the Agency Grant Deed for the Site to be recorded and the
policy of insurance for the Site to be delivered to the
Developer.
(d) 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.
Section 2.04. Escrow Instructions. This Amendment
No. 2 also constitutes escrow instructions of the parties to the
Escrow Holder. Additionally, the Developer and the Agency each
agree to execute the customary supplemental escrow instructions
of the Escrow Holder in the form provided by the 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 Escrow
Holder and the provisions of this Amendment No.2, shall
supersede and be controlling. Upon any termination of this
Amendment No. 2 or cancellation of the Escrow, the Escrow Holder
shall forthwith return all monies (as provided in this Amendment
No.2) and documents, less only the Escrow Holder's customary
and reasonable escrow cancellation fees and expenses, as set
forth herein.
Section 2.05. Conveyance of Title. On or before
12: 00 noon on the business day preceding the Closing Date, the
Agency shall deliver to the Escrow Holder a grant deed for the
Site in the form attached hereto as Exhibit "0" (the "Agency
Grant Deed") duly executed and acknowledged by the Agency, which
Agency Grant Deed shall convey all of the right, title and
interest of the Agency in the Site 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 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 CLTA owner's extended coverage policy
of title insurance ("Title Policy") issued by Orange Coast Title
Insurance Company or such other title insurance company mutually
SB2002:2242.4
14
e
e
e
agreed upon by the parties ("Title Company") with liability in
an amount equal to the Purchase Price together with such
endorsements to the policy as may be reasonably requested by the
Developer, insuring the following:
that the Site consists of a total of 38 lots pursuant
to the Subdivision Map Act with fee title to the Site
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 pursuant to Section 2.13 below;
(3) applicable provisions of the subdivision map for
the Site;
(4) the provisions of the Agency Grant Deed for the
Site;
(5)
the applicable provisions of this
2; and
Amendment No.
(6)
resulting
delivered
such other title
from documents
through Escrow.
exceptions, if
being recorded
any,
or
Section 2.06. Additional Closinq Obliqations of
Aqency. On or before 12: 00 noon on the business day preceding
the Closing Date (unless indicated otherwise), the Agency shall
deliver to the Escrow Holder (unless indicated to be delivered
directly to the Developer) copies of the following documents and
other items:
(1 )
Foreign
customary
California
Agency;
a certificate of non-foreign status (the "Non-
Affidavit") executed by the Agency, in the
form provided by the Escrow Holder, and a
Franchise Tax Board Form 590-RE executed by the
(2) all soils, seismic, geologic, drainage, toxic
waste and environmental reports, surveys, "as-built" plans
and specifications, working drawings, grading plans,
elevations and similar information with respect to the Site
heretofore obtained by the Agency, if any, which the Agency
has in its possession and/or control to the extent that
originals of such items have not been delivered previously
582002:2242.4
15
e
e
e
by the Agency to the Developer pursuant to Section 2.08
below;
(3) two (2) duplicate original copies of the
estimated Closing Statement described in Section 2.21, duly
executed by the Agency;
(4) 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 Escrow Holder and Title Company;
(5) a hazards report on the Site;
Note
and
the
II;
(6) the original Promissory Note I and Promissory
II, each endorsed by the Agency as discharged, waived
forgi ven together with a release and reconveyance of
deed of trust securing the repayment of Promissory Note
and
(7) any other documents,
records required to be delivered
terms of Amendment No. 2 which
delivered.
instruments, funds and
to the Developer under the
have not been previously
Section 2.07. Closing Obliqations of Developer. On
or before 12: 00 noon on the. business day preceding the Closing
Date, the Developer shall deliver to the Escrow Holder copies of
the following documents and other items:
(1) an
Grant Deed,
Developer.
acknowledgment and
duly executed
acceptance of the Agency
and acknowledged by the
(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 Escrow Holder and the Title Company.
(4) evidence
pursuant to the
including but not
infrastructure.
of financing the Scope of Development
provisions of this Amendment No.2,
limited to the financing of the necessary
882002:2242.4
16
e
e
e
(5) evidence that the City and the Developer
executed the Subdivision Improvement Agreement and
Developer has delivered and the City has accepted
subdivision improvement performance and payment bonds
the installation of the public improvements necessary
the development of the Site;
have
the
the
for
for
(6) any other documents, instruments or funds
required to be delivered by the Developer under the terms
of Amendment No. 2 or as otherwise required by Escrow
Holder or Title Company in order to close Escrow which have
not previously been delivered.
Section 2.08.
Inspections and Review.
(a)
the execution
true, correct
documents and
Developer:
Due Diligence Items. Within five (5) days after
of this Amendment No.2, the Agency shall deliver
and complete copies or originals of the following
items (collectively, "Due Diligence Items") to the
(i)
copies of all soils, seismic, geologic, drainage,
toxic waste, engineering, environmental and
similar type reports and surveys (including, but
not limited to, any Environmental Site
Assessments of the Si te) , surveys, building
grading plans, drawings (including "as-built"
plans and specifications), schematics, blueprints
and working drawings for the improvement of the
Site or Sales Office, 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 violations, including, but not limited
to, zoning ordinances, development or building
codes affecting the Site the Agency's possession
or control.
(iii) disclosure of any legal matters affecting the use
or condition of the Site within the knowledge of
the Agency.
Amendment
following
(b) Certain
No.2, the
meaning:
this
the
Definitions. For
terms set forth
the purpose
below shall
of
have
SB2002:2242.4
17
e
e
e
8B2002:2242.4
(i) "environmental laws" means 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
pertaining 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 300f et 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
18
e
e
e
Site.
SB2002:2242.4
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.
(ii) "hazardous
limitation:
includes
without
substances"
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, HMTA, 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,
are or become regulated or
hazardous or toxic under fed~ral,
laws or regulations; and
and wastes that
classified as
state, or local
any material, waste, or substance that is
(1) a petroleum or refined petroleum product,
(2) asbestos,
(3) polychlorinated biphenyl,
(4 )
designated as
33 USC Section
Section 1317,
a hazardous substance pursuant to
1321 or listed pursuant to 33 USC
(5) a flammable explosive, or
(6) a radioactive material.
Section 2.09. Due
Diligence
Investiqation
of
the
19
e
e
e
(a) Within thirty (30) days from and after the
Opening of Escrow, and subj ect to the extensions of time set
forth below in Section 2.15, the Developer shall have the right
to examine, inspect and investigate the Site (the "Due Diligence
Period") to determine whether their condition is acceptable to
the Developer in its sole and absolute discretion.
(b) During the Due Diligence Period, the Agency shall
permi t the Developer, its engineers, analysts, contractors and
agents to conduct such physical inspections and testing of the
Site as the Developer deems prudent with respect to the physical
condition of the Site, including the inspection or investigation
of soil and subsurface soil geotechnical condition, drainage,
seismic and other geological and topographical matters, and for
purposes of surveying the potential presence of any hazardous
substances, if any. Any such investigation work on the Site may
be conducted by the Developer and/or its agents during any
normal business hours upon seventy-two (72) hours prior notice
to the Agency, which notice will include a description of any
investigation work or tests to be conducted by the Developer on
the Site. Upon the Agency's request, the Developer will provide
the Agency with copies of any test results to the extent it is
not contractually prohibited from doing so and further, to the
extent that the deli very of such copies to the Agency shall
impose no cost or other liability upon the Developer. 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 Site. The Agency shall
cooperate fully to assist the Developer in completing such
inspections and investigations of the condition of the Site.
The Agency shall have the right, but not the obligation, to
accompany the Developer during such investigations and/or
inspections.
Section 2.10. Due Diliqence Approval Certificate.
Within sixty (60) days following the Opening of Escrow, the
Developer shall complete its investigation of the Site (subj ect
to the extensions of time set forth in Section 2.15) and deliver
a due diligence approval certificate signed by the Developer
(the "Due Diligence Approval Certificate") to the Escrow Holder
which either:
(i)
indicates that the Developer
condition of the Site or;
accepts
the
(ii) contains a description of the matters or
exceptions relating to the condition of the Site
SB2002:2242.4
20
e
e
e
which the Developer was not able to
resolve to its satisfaction during
Diligence Period.
accept
the
or
Due
Section 2.11. Books and Records. As part of the
Developer's due diligence investigations during the Due
Diligence Period, t.he Developer shall be afforded full
opportunity by the Agency to examine all books and records which
relate to the Site in the possession of the Agency and/or the
Agency's agents or employees, including the reasonable right to
make copies of such books and records. During the Due Diligence
Period, the Agency will make sufficient staff available to
assist the Developer with obtaining access to information
relating to the Site which is in the possession or control of
Agency.
Section 2.12. Condition of the Site; Developer's
Release. The Developer acknowledges and agrees that it shall be
given a full opportunity under this Amendment No. 2 to inspect
and investigate every aspect of the Site during the Due
Diligence Period. The Developer shall accept the deli very of
title to the Site on the Close of Escrow in an MAS IS," MWHERE
IS" and MSUBJECT 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 the
Site which the Developer may believe to be indicated. The
Developer hereby acknowledges that it shall rely solely upon its
own investigation of the Site and its own review of such
information and documentation as it deems appropriate for the
purpose of accepting the condition and possession of the Site.
The Developer is not relying on any statement or representation
by the Agency relating to the condition of the Site unless such
statement or representation is specifically contained in this
Amendment No.2. Without limiting the foregoing, the Agency
makes no representations or warranties as to whether the Site
presently comply with environmental laws or whether the Site
contain any hazardous substance, as these terms are defined in
Section 2.08 (b) hereof. Furthermore, to the extent that the
Agency has provided the Developer with information relating to
the condition of the Site, including information and reports
prepared by or on behalf of the City of San Bernardino, the
Agency makes no representation or warranty with respect to the
accuracy, completeness or methodology or content of such reports
or information.
SB2002:2242.4
21
1--
e
e
e
Without limiting the above, except to the extent
covered by an express representation or warranty of the Agency
set forth in this Amendment No.2, 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 the Site or any law or regulation applicable
thereto, including the presence or alleged presence of harmful
or hazardous substances in, under or about the Site including,
without limitation, any claims under or on account of (i) CERCLA
and similar statutes and any regulations promulgated thereunder
or (ii) any other 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
Amendment No.2, 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 2.12 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.
$B2002,2242.4
22
e
e
e
Initials of Developer:
The provisions of this Section 2.12 shall survive
the Close of Escrow.
Section 2.13. Review and Approval of Condition of
Title by the Developer.
(a) Within fifteen (15) days following the Opening
of Escrow, Agency shall cause to be delivered to the Developer a
preliminary title report or title commitment for a CLTA extended
coverage policy of title insurance issued by the Title Company,
describing the condition of title of the Site together with
copies of all exceptions specified therein and with all
easements plotted but excluding matters disclosed on a survey
(the "Preliminary Title Report"). The Developer shall notify
the Agency in writing within ten (10). days of its receipt of
such preliminary title report ("Developer's Title Objection
Notice") of any obj ections the Developer may have to the title
exceptions contained in the Preliminary Title Report prior to
the expiration of the Due Diligence Period. The Agency shall
have a period of five (5) days after receipt of the Developer's
Title Objection Notice 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 prior to the
Close of Escrow, or (ii) decline to remove any such title
exceptions and terminate this Amendment No. 2 and cancel the
Escrow; provided, however, that the Agency shall be required to
remove all monetary liens and encumbrances created by or as a
resul t of the Agency's acti vi ties. I f the Agency notifies the
Developer of its election to terminate Amendment No. 2 and
cancel Escrow rather than remove the obj ectionable items, 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 Site subj ect
to the objectionable items, in which event the Agency's election
to terminate Amendment No. 2 and cancel the Escrow shall be of
no effect, and the Developer shall take title at the Close of
Escrow subject to such objectionable title items. In the event
that the Escrow is terminated by the Agency under this Section
2.13(a), the Agency shall be responsible for paying for all
Escrow cancellation costs of the Escrow Holder and the Deposit
shall be promptly returned to the Developer.
Ib) The Agency covenants not to further encumber and
not to place any further liens or encumbrances on the Site,
including, but not limited to, covenants, conditions,
restrictions, easements, liens, options to purchase, options to
5B2002,2242.4
23
e
e
e
lease, leases, tenancies, or other possessory interests without
the prior written consent of the Developer. Upon the issuance
of any amendment or supplement to the Preliminary Title Report
which adds additional exceptions (including, but not limited to,
adding additional exceptions for matters shown on the Survey as
hereinafter defined), the foregoing right of review and approval
shall also apply to sa'i.d amendment or supplement (provided that
the period for the Developer to review such amendment or
supplement shall be the later of the expiration of the Due
Diligence Period or ten (10) days from receipt of the amendment
or supplement) and Escrow shall be deemed extended by the amount
of time necessary to allow such review and approval in the time
and manner set forth above.
Section 2.14. Survey. The Developer may obtain a
survey of the Site prepared by a land surveyor duly licensed by
the State of California and in compliance with ALTA/ASCM
standards (" Survey"). The Survey shall be in a form acceptable
to the Title Company for the deletion of the standard survey
exception in the Title Policy relating to boundaries, without
the addition of further exceptions unless the same are
acceptable to the Developer in its sole and absolute discretion.
The Developer shall have until the end of the Due Diligence
Period to complete and examine the Survey and to notify Agency
in wri ting of any obj ections the Developer has to the Survey
(" Developer's Survey Obj ection Notice"). The Agency shall have
a period of five (5) days after receipt of the Developer's
Survey Objection Notice in which to deliver written notice to
the Developer ("Agency's Survey Notice") of the Agency's
election to ei ther: (i) agree to remove the obj ectionable items
prior to the Close of Escrow or (ii) decline to remove such
items and terminate this Amendment No. 2 and the Escrow. If the
Agency notifies the Developer of its intention to not remove the
objectionable items, the Developer shall have the right, by
written notice delivered to the Agency within five (5) days
after the Developer's receipt of Agency's Survey Notice, to
agree to accept the Site subject to the objectionable items, in
which event, the Agency's election to terminate Amendment No. 2
and cancel the Escrow shall be of no effect, and the Developer
shall accept the Property at the Close of Escrow subject to such
objectionable items. In the event that Amendment No. 2 is
terminated by the Agency under this Section 2.14, the Agency
shall be responsible for paying for all Escrow cancellation
costs of the Escrow Holder and the Deposit shall be promptly
returned to the Developer. Prior to the Closing, the Survey
shall be recertified to the Developer, Title Company and the
Developer's lender, if any. The Survey will be performed at the
Developer's sole cost and expense.
382002:2242.4
24
e
e
e
Section 2.15. Extension of Due Diligence Period. In
the event Agency fails to provide to the Developer the documents
and other information required by Sections 2.08 by the date(s)
set forth therein, the Due Diligence Period for such information
shall be extended by one (1) day for each day of the delay by
the Agency to permit the Developer to perform an adequate 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 Sections 2.08 and
2.11. In the event that the Developer has delivered its Due
Diligence Approval Certificate and thereafter, prior to the
Close of Escrow, the Agency presents the Developer with any new
Due Diligence Item, the Close of Escrow shall be extended to
permit the Developer to perform an adequate due diligence review
of such new item for up to thirty (30) days. In the event that
the Developer may fail to accept such new item within such
additional period of time and cause the Escrow to close, then in
such event either party may terminate this Amendment No. 2 and
cancel the Escrow as set forth in Section 2.20.
Section 2.16. Developer's Conditions Precedent. The
Developer's obligation to purchase the Site shall be conditioned
upon the fulfillment of the following conditions precedent, all
of which shall be satisfied (or waived in writing pursuant to
Section 2.19) prior to the Close of Escrow:
(1) The Agency shall not have defaulted on any
material term of this Amendment No. 2 to be performed by
the Agency hereunder, and each representation and warranty
made by the Agency in this Amendment No. 2 shall remain
true and correct. For purposes of this subsection (1)
only, a representation that is limited to the Agency's
knowledge or notice 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
Report and the Survey, if applicable, within the
periods specified in Sections 2.13 and 2.14;
Title
time
(3) the Developer's approval of the contents of all
Due Diligence Items, and the other investigations of the
Site made by the Developer and/or its designees pursuant to
Sections 2.08 and 2.09 herein on or before the expiration
of the Due Diligence Period, or such later date if the Due
SB2002:2242.4
25
e
e
e
Diligence Period is extended pursuant to Section 2.15. 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, or
such later date if the Due Diligence Period is extended
pursuant to Section 2.15 herein;
(4) the Developer's approval of any notice of change
in representation or warranty given by the Agency pursuant
to Section 2.24(a)hereof;
(5) the Title Company
Title Policy, in favor of
described in Section 2.05;
committed
Developer
to issue the
in the form
has
the
(6) the Developer has obtained a construction
financing loan commitment to cover all costs of development
of the Site including but not limited to the installation
of the public improvements necessary for the development of
the Site, and payment of all City or School fees, or other
governmental entities fees, on terms reasonably acceptable
to it;
(7) the Agency shall have deemed satisfied (or waived
satisfaction of) each of the conditions precedent set forth
in Section 2.17;
(8) the City shall have approved the form of the
Subdivision Improvement Agreement for the Site;
(9) the City Engineer has approved the subdivision
completion surety bond and the payment surety bond for the
installation of the installation of the public improvements
as required for the development of the Site by the
Developer;
(10) provided such plans have been submitted to the
City of San Bernardino by the Developer by a date not later
than May 1, 2002, the City of San Bernardino shall have
completed the plan check for the improvement of the New
Homes on the Site and the construction and installation of
the public improvements for the development of the Site as
approved by the City of San Bernardino Planning Commission
wi thin sixty (60) days following the opening of Escrow and
notification to Developer by the City of San Bernardino
that permits are available for pick-up.
582002:2242.4
26
e
e
e
Section 2.17. The Aqency' s Condi tions Precedent. The
Agency's obligation to convey the Site to the Developer shall be
conditioned upon the fulfillment of the following conditions
precedent, all of which shall be satisfied (or waived in writing
pursuant to Section 2.19) prior to the Close of Escrow:
(1) the Developer has accepted the condition of the Site
and submitted its Due Diligence Approval Certification
to the Escrow Holder on or before the date set forth
in this Amendment No.2;
(2) the Developer has accepted the condition of title of
the Site on or before the date set forth in Section
2.13;
(3 )
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 Site,
including all applicable development fees, with an
initial construction loan disbursement amount
sufficient to construct and improve not less than
sixteen (16) of the Site Lots;
(4 )
the Developer shall not be in default of any material
term of this Amendment No. 2 to be performed by the
Developer hereunder and each representation and
warranty of the Developer made in this Amendment No. 2
shall remain true and correct;
(5) the Developer shall have satisfied (or shall be deemed
to have waived satisfaction of) each of the conditions
precedent set forth in Section 2.16; and
(6) the City Engineer and the Developer shall have each
approved the form of the Subdivision Improvement
Agreement for the Site and shall have delivered fully
executed completion and payment surety bonds to the
City Engineer in form and principal amount
satisfactory to the City Engineer.
Section 2.18. Delivery of Documents and Purchase
Price After Closing Date by Escrow Holder. The Escrow Holder
shall deliver to the Agency the Site Purchase Price and to the
Developer wi thin (3) business days following the Closing Date a
conformed copy of the Agency Grant Deed, as recorded and the
policy of title insurance issued by the Title Company in favor
of the Developer.
SB20Q2:2242.4
27
e
e
e
Section 2.19. 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 2.20. Termination. In addition to the right
of each party to terminate this Amendment No. 2 pursuant to
Section 2.03, in the event each of the conditions set forth in
Section 2.16, in the case of the Developer, or Section 2.17 in
the case of the Agency is not fulfilled within one hundred and
twenty (120) days after the Opening of Escrow (subject to
Section 2.15, if applicable) or waived by the applicable party
pursuant to Section 2.19, either party may, at its option,
terminate this Amendment No. 2 and cancel the Escrow opened
hereunder, thereby releasing the parties from further
obligations hereunder (except as may arise under the Temporary
License Agreement for the Grading of Land), and all documents
delivered by the Developer to the Agency or the Escrow Holder
shall be returned to the Developer and all documents delivered
by the Agency to the Developer or the Escrow Holder shall be
returned to the Agency, and the Deposit shall be disbursed to
the Developer, except as set forth in Section 2.02 (b) . Nothing
in this Section 2.20 shall be construed as releasing any party
from liability for any default of its obligations hereunder or
breach of its representations and warranties under this
Amendment No. 2 occurring prior to the termination of this
Amendment No. 2 and/or the cancellation of the Escrow, or as may
arise under Section 2.21 (b) (A) or (B) in the event the Developer
may accept possession of the Site prior to the Close of Escrow.
Section 2.21. Prorations, Closing Costs, Possession.
(a) Proration of Taxes. Real and personal property
taxes for the Site shall be prorated by the parties to the
Closing Date 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
SB2002:2242.4
28
e
e
e
Period to 11: 59 p.m. on the Closing Date, 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 occurs. All tax
prorations shall be based upon the latest available tax
statement. If the tax statements for the fiscal tax year during
which Escrow closes do not become available until after the
Closing Date, 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 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 real or personal property taxes
payable following the Closing Date applicable to any period of
time prior to the Closing Date as a result of any change in the
tax assessment by reason of reassessment, changes in use of the
Property, changes in ownership, errors by the Assessor or
otherwise.
(b) Possession. The Developer shall be entitled to
exclusive possession of the Site immediately upon the Close of
Escrow. 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 2.16, the
Agency shall upon the written request of the Developer:
IA)
to enter
following
the Developer a temporary
prior to the Closing Date
license
for the
grant to
the Site
purposes:
Ii) to remove weeds, surface debris and graffiti
from the Site;
Iii)
intrusive soil
for repairs to
surrounding the
to conduct surveys
engineering testing
existing perimeter
Site;
and
and
walls
I iii) to install temporary subdivision land sales
advertising signs on the Site as permitted
under the City sign ordinance;
(iv)
to conduct such other limited
predevelopment investigation as
approved by the Agency in
discretion; or
of
be
sole
work
may
its
SB2002:2242.4
29
e
e
e
the Developer a temporary license
prior to Closing Date to perform the
term is defined in the Temporary
for the Grading of Land in the form
Exhibit "En.
(B) grant to
to enter the Site
"Work", as this
License Agreement
attached hereto as
(C) Prior to the entry by the Developer onto any
portion of the Site pursuant to such a license under
Section 2.21(b)A), above, the Developer shall execute
a written license agreement affecting the Site 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 Site which may arise prior to the Closing
Date by virtue of the Developer's entry onto the Site,
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 the
Si te or any portion thereof pursuant to such license
agreement. Prior to the entry by the Developer onto
the Site to perform any work authorized under Section
2.21 (b) (B), the Developer shall execute the Temporary
License Agreement for the Grading of Land and deliver
the grading work completion surety bond and other
insurance to the Agency as called for therein.
(c) Title Insurance Premium, Escrow and Closing
Costs. The Agency shall pay the cost of the premium for a CLTA
owner's extended coverage policy of title insurance on the Site
in the amount of the Site Purchase Price, together with all
title charges (including endorsements reasonably requested by
the Developer to remove disapproved items shown on the
Preliminary Title Report or Survey pursuant to Sections 2.13 and
2.14 above), and the Agency shall also pay any documentary or
other transfer taxes payable on account of the conveyance of the
Site to the Developer, together with one-half (~) of the
customary and reasonable escrow fees which may be charged by the
Escrow Holder in connection with the Close of Escrow.
The Developer shall pay the additionall cost of te
Survey and requested CLTA survey policy endorsements (to the
extent such endorsements are unrelated to removal of any
disapproved items shown on the preliminary Title Report or
Survey pursuant to Sections 2.13 and 2.14 above) which exceeds
the premium for a CLTA owner's extended coverage policy of title
insurance on the Site plus the cost of recording the Agency
582002:2242.4
30
e
e
e
Grant Deeds, together with one-half (~) of the cost of the
customary and reasonable escrow fees charged by Escrow Holder in
connection with the Close of Escrow.
Any other Escrow-related transaction expenses or
escrow closing costs incurred by the Escrow Holder in connection
wi th this transaction shall be apportioned and paid for by the
parties to this Amendment No. 2 in the manner customary in San
Bernardino County, California.
No later than three (3) business days prior to the
Closing Date, the Escrow Holder shall prepare for approval by
the Developer and the Agency a closing statement ("Closing
Statement") on the Escrow Holder's standard form indicating,
among other things, the Escrow Holder's estimate of all closing
costs, pay-off amounts for the release and reconveyance of all
liens secured by the Site and prorations made pursuant to this
Amendment No.2. The Developer and the Agency shall assist the
Escrow Holder in determining the amount of all prorations.
Section 2.22. BREACH OF ARTICLE II BY THE AGENCY;
LIQUIDATED DAMAGES PAYABLE BY THE AGENCY TO THE DEVELOPER. IN
THE EVENT THAT THE AGENCY COMMITS A MATERIAL BREACH OF ITS
OBLIGATIONS UNDER THIS ARTICLE II PRIOR TO THE CLOSE OF ESCROW,
THE DAMAGES THAT THE DEVELOPER WILL INCUR BY REASON THEREOF ARE
AND WILL BE IMPRACTICAL AND EXTREMELY DIFFICULT TO ESTABLISH.
THE DEVELOPER AND THE AGENCY, IN A REASONABLE EFFORT TO
ASCERTAIN WHAT THE DEVELOPER'S DAMAGES WOULD BE IN THE EVENT OF
SUCH A DEFAULT BY THE AGENCY, HAVE AGREED THAT SUCH DAMAGES
SHALL BE IN AN AMOUNT EQUAL TO THE SUM OF TWENTY FIVE THOUSAND
DOLLARS ($25,000.00) AS LIQUIDATED DAMAGES. SUCH SUM SHALL BE
PAID TO THE DEVELOPER IN THE EVENT OF SUCH DEFAULT BY THE AGENCY
UPON THE TERMINATION OF THIS AMENDMENT NO. 2 AND CANCELLATION OF
THE ESCROW, AS LIQUIDATED DAMAGES, WHICH DAMAGES SHALL BE THE
DEVELOPER'S SOLE AND EXCLUSIVE REMEDY AT LAW OR IN EQUITY IN THE
EVENT OF AND FOR SUCH DEFAULT BY THE AGENCY. WITHOUT LIMITING
THE FOREGOING PROVISIONS OF THIS PARAGRAPH, THE DEVELOPER WAIVES
ANY AND ALL RIGHTS WHICH THE DEVELOPER OTHERWISE WOULD HAVE HAD
UNDER CIVIL CODE SECTION 3389 TO SPECIFICALLY ENFORCE THIS
AMENDMENT NO.2. THE DEVELOPER AND THE AGENCY ACKNOWLEDGE AND
AGREE THAT EACH OF THEM HAS READ AND UNDERSTANDS THE PROVISIONS
OF THIS SECTION AND EACH AGREES TO BE BOUND BY ITS TERMS.
Initials of Agency
Initials of Developer
Section 2.23. BREACH BY THE DEVELOPER OF ARTICLE II;
LIQUIDATED DAMAGES PAYABLE BY THE DEVELOPER TO THE AGENCY. IN
882002:2242.4
31
e
e
e
THE EVENT THAT THE DEVELOPER COMMITS A MATERIAL BREACH OF ITS
OBLIGATIONS UNDER THIS ARTICLE II PRIOR TO THE EARLIER DATE OF
THE DEVELOPER'S ACCEPTANCE OF POSSESSION OF THE SITE UNDER
SECTION 2.21(b) (B) OR THE CLOSE OF ESCROW, WHICHEVER DATE FIRST
OCCURS, THE DAMAGES THAT THE AGENCY WILL INCUR BY REASON THEREOF
ARE AND WILL BE IMPRACTICAL AND EXTREMELY DIFFICULT TO
ESTABLISH. THE DEVELOPER AND THE AGENCY, IN A REASONABLE EFFORT
TO ASCERTAIN WHAT THE AGENCY'S DAMAGES WOULD BE IN THE EVENT OF
SUCH A DEFAULT BY THE DEVELOPER, HAVE AGREED THAT SUCH DAMAGES
SHALL BE IN AN AMOUNT EQUAL TO THE SUM OF TWENTY-FIVE THOUSAND
DOLLARS ($25,000.00) AS LIQUIDATED DAMAGES. SUCH SUM SHALL BE
PAID TO THE AGENCY IN THE EVENT OF SUCH DEFAULT BY THE DEVELOPER
AS LIQUIDATED DAMAGES, WHICH DAMAGES SHALL BE THE AGENCY'S SOLE
AND EXCLUSIVE REMEDY AT LAW OR IN EQUITY IN THE EVENT OF AND FOR
SUCH DEFAULT BY THE DEVELOPER. WITHOUT LIMITING THE FOREGOING
PROVISIONS OF THIS PARAGRAPH, THE AGENCY WAIVES ANY AND ALL
RIGHTS WHICH THE AGENCY OTHERWISE WOULD HAVE HAD UNDER CIVIL
CODE SECTION 3389 TO SPECIFICALLY ENFORCE THIS AMENDMENT NO.2.
THE AGENCY AND THE DEVELOPER ACKNOWLEDGE AND AGREE THAT EACH OF
THEM HAS READ AND UNDERSTANDS THE PROVISIONS OF THIS SECTION AND
EACH AGREES TO BE BOUND BY ITS TERMS.
Initials of Developer
Initials of Agency
Section 2.24. Representations and Warranties.
(a) Warranties and Representations by the Aqency.
The Agency hereby makes the following representations, covenants
and warranties and acknowledges that the execution of this
Amendment No. 2 by the Developer has been made and the
acquisition by the Developer of the Site will have 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 Amendment No. 2 shall
be performed by the Agency timely when due; and that all
representations and warranties of the Agency under this
Amendment No. 2 and its exhibits shall be true in all
material respects at the Closing as though they were made
at the time of Closing.
(ii) Due Orqanization. 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 Amendment No. 2 and to
582002:2242.4
32
e
e
e
execute the instruments and documents referenced herein,
and to consummate the transactions contemplated hereby.
(iii) Requisi te Action. The Agency has taken all
requisi te action and obtained all requisite consents for
agreements or matters to which the Agency is a party in
connection with entering into this Amendment No. 2 and the
instruments and documents referenced herein and in
connection with the consummation of the transactions
contemplated hereby.
(iv) Enforceability of Aqreement. The persons
executing any instruments for or on behalf of the Agency
have been authorized to act on behalf of the Agency and
that this Amendment No. 2 is valid and enforceable against
the Agency in accordance with its terms and each instrument
to be executed by the Agency pursuant hereto or in
connection therewith will, when executed, shall be valid
and enforceable against the Agency in accordance with its
terms. No approval, consent, order or authorization of, or
designation or declaration of any other person, is required
in connection with the valid execution and delivery of and
compliance with this Amendment No. 2 by the Agency.
(v) Title. Prior to the Closing, the Agency will be
the owner of (and the Developer will acquire hereunder) the
entire right, title and interest in and to the Site.
(vi) No Litigation. There are no pending or, to the
best of the Agency's knowledge, threatened claims, actions,
allegations or lawsuits of any kind, whether for personal
inj ury, property damage, property taxes or otherwise, that
could materially and adversely affect the value or use of
the Site or prohibit the sale thereof, nor to the best of
the Agency's knowledge, is there any governmental
investigation of any type or nature pending or threatened
against or relating to the Site or the transactions
contemplated hereby.
(vii)
Between the
Escrow, the
maintain the
the execution
Pendinq Closinq.
2 and the Close of
manage, operate and
as existed prior to
Operation and Condition
date of this Amendment No.
Agency will continue to
Si te in the same manner
of this Amendment No.2.
(viii)
agreements
operation,
Contracts. There
to which the Agency is
maintenance, service,
are no contracts or
a party relating to the
repair, development,
SB2002:2242.4
33
e
e
e
improvement or ownership of either the Site which will
survi ve the Close of Escrow except as may be disclosed to
the Developer by the Agency prior to the end of the
Developer's Due Diligence Period.
(ix) Special Studies Zone. Neither the Site is to the
best knowledge of the Agency located wi thin a designated
earthquake fault zone pursuant to California Public
Resources Code Section 2621.9 or a designated area that is
particularly susceptible to ground shaking, liquefaction,
landslides or other ground failure during an earthquake
pursuant to California Public Resources Code Section 2694.
(x) Use of Agency Low-Mod Funds. The sole source of
funds which the Agency shall use to make disbursements to
the Developer of each installment of the Affordable Housing
Sales Grant shall 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.
(xi) The Agency's Knowledge. For purposes of this
Section 2.22, the terms "to the best of the Agency's
knowledge" or "to the Agency's knowledge" shall mean the
actual knowledge of Gary Van Osdel, Executive Director, and
Maggie Pacheco, Deputy Director.
If the Agency becomes aware of any act or circumstance
which would change or render incorrect, in whole or in part, any
representation or warranty made by the Agency under this
Amendment No.2, whether as of the date given or any time
thereafter through the Closing Date and whether or not such
representation or warranty was based upon the Agency'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 Developer, but such notice shall not release the Agency of
its liabilities or obligations with respect thereto.
All representations and warranties contained in this
Section 2.24 (a) are true and correct on the date hereof and on
the Closing Date and the Agency's liabili ty for
misrepresentation or breach of warranty, representation or
covenant, wherever contained in this Amendment No.2, shall
survive the execution and delivery of this Amendment No. 2 and
the Close of Escrow.
5B2002:2242.4
34
e
e
e
(b) Warranties and Representations by the Developer.
The Developer hereby makes the following representations,
covenants and warranties and acknowledges that the execution of
this Amendment No. 2 by the Agency has been made in material
reliance by the Agency on such covenants, representations and
warranties:
(1) The Developer is a duly organi zed and
validly existing California limited partnership. The
Developer has the legal right, power and authority to
enter into this Amendment No. 2 and the instruments
and documents referenced herein and to consummate the
transactions contemplated hereby. The persons
executing this Amendment No. 2 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.
(2) The Developer has taken all requisite action
and obtained all requisite consents in connection with
entering into this Amendment No. 2 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 Amendment No.
2 .
(3) This Amendment No. 2 is, and all agreements,
instruments and documents to be executed by the
Developer pursuant to this Amendment No. 2 shall be,
duly executed by and are or shall be valid and legally
binding upon the Developer and enforceable in
accordance with their respective terms.
(4) Neither the execution of this Amendment No.
2 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 or to the Site.
(5) The representations and warranties of the
Developer contained in this Section 2.24 (b) shall be
based upon the actual knowledge of John W. Pavelak.
SB2002:2242.4
35
e
e
e
All representations and warranties contained in this
Section 2.24 (b) are true and correct on the date hereof and on
the Closing Date and Developer's liability for misrepresentation
or breach of warranty, representation or covenant, wherever
contained in this Amendment No.2, shall survive the execution
and delivery of this Amendment No.2 and the Closing.
Section 2.25. Damage, Destruction and Condemnation.
Prior to the Agency's deli very of possession of the Site to
Developer under either Section 2.21 (b) (B) or at the Close of
Escrow, the risk of loss or damage to the Site shall remain upon
the Agency. If either the Site suffers damages as a result of
any casualty prior to either of the applicable dates set forth
in the preceding sentence which may materially diminish their
value, then the Agency shall give written notice thereof to
Developer promptly after the occurrence of the casualty. The
Developer can elect to either: (i) accept the Site in their
damaged condition or (ii) the Developer may terminate this
Amendment No. 2 and recover the Deposit as set forth in Section
2.02. The Developer shall confirm the exercise of its election
under subparagraph (i) or (ii) of the preceding sentence wi thin
thirty (30) days of its receipt of notice from the Agency.
In the event that, prior to the Close of Escrow, any
governmental entity shall commence any actions of eminent domain
or similar type proceedings to take any portion of either the
Site or Sales Office, the Agency shall give prompt written
notice thereof to Developer, and Developer shall have the option
ei ther: (i) to elect not to acquire the Site, terminate the
Amendment No. 2 and recover the Deposit as set forth in Section
2.02; or (ii) the Developer may complete the acquisition of the
Site, in which case Developer shall be entitled to all the
proceeds of such taking; provided however, that the Agency
agrees that it shall not set tIe or compromise the proceedings
before the Close of Escrow without the Developer's prior
written consent, which consent will not be unreasonably withheld
or delayed. The Developer shall confirm the exercise of its
election under subparagraph (i) or (ii) of the preceding
sentence within thirty (30) days of its receipt of notice from
the Agency.
ARTICLE III
DEVELOPMENT OF THE SITE
Section 3.01. Development by Developer.
882002:2242.4
36
e
e
e
la) Scope of Development. It is the intent of the
parties that the Site be developed as follows: the
construction by the Developer on the Site Lots of thirty-eight
(38) single family detached residential dwelling units (e. g..
each a New Home), containing a minimum interior living area of
1300 square feet each, together with all on and off site
improvements such as streets, curbs, sidewalks, storm drains,
gut ter, utili ties, etc (e. g., the public improvements necessary
for the development of the Site). At least twenty percent (20%)
of the New Homes are to be reserved for sale to "Qualified Home
Buyers" whose "Adjusted Family Income" at the time of initial
occupancy of each New Home, does not exceed the household income
qualification limits of a "Moderate-Income Household."
Accordingly, upon the close of the New Home Escrow which
transfers the 38th New Home to a New Home Buyer, at least eight
(8) of the New Homes shall have been sold by the Developer to
Qualified Home Buyers. As used in the preceding sentence and
elsewhere in this Amendment No.2, the words identified below
shall have the following meaning:
"Affordable Housing Cost".
Cost" shall have the same
and Safety Code Section
hereafter be amended from
California.
The words "Affordable Housing
meaning as set forth in Health
50052.5, as this section may
time-to-time by the State of
"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 1.167Ik) 3 Ib) (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.
"Delivery Date." The words "Delivery Date"
on which a New Home Escrow closes and
Buyer/Qualified Home Buyer, as applicable,
title interest in the completed New Home.
mean the
the New
acquires
date
Home
fee
"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
appropriate for the New Home by the State Department of
Housing and Community Development in accordance with
582002,2242.4
37
e
e
e
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, 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 Horne" mean and refer to the
completed affordable single-family residential dwelling
uni t (including the land and landscape improvements
thereon) as constructed and installed by the Developer or
any subdivided lot on the Site and sold to the Qualified
Horne Buyer.
"New Home Buyer." The words
refer to any purchaser of a New
Horne Buyers.
"New Horne Buyer" mean and
Horne and includes Qualified
"New Home
refer to
Developer
Developer
Horne to a
Escrow." The words "New Horne Escrow" mean
the escrow transaction by and between
and each New Horne Buyer, through which
shall transfer fee title in each completed
New Horne Buyer.
and
the
the
New
"Qualified Home Buyer." The words "Qualified Horne Buyer"
mean the purchaser of the New Horne from the Developer
(e. g. : all persons identified as having a property
ownership interest vested in the New Horne as of the close
of the New Horne Escrow). At the close of the New Horne
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:
Iii) 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 Horne pursuant to the
terms of the purchase transaction for the New Horne,
including all sums payable by the Qualified Homebuyer for
its purchase money mortgage financing, insurance, escrow
and other fees and costs.
"Qualified Residence Period." The words "Qualified
Residence Period" mean the period of time beginning on the
Delivery Date and ending on the date which is forty-five
(45) years after the Delivery Date.
SB2002:2242.4
38
e
e
e
(b) The City's zoning ordinance and the City's
building requirements will be applicable to the use and
development of the Site pursuant to this Amendment No.2. The
Developer acknowledges that any change in the plans for
development of the New Homes on the Site as set forth in the
Scope of Development shall be subject to the City's zoning
ordinance and building requirements, provided, however that not
less than twenty percent (20%) of the New Homes developed on the
Site shall be reserved for sale and occupancy by Qualified Home
Buyers as set forth in Section 3.01(a) and Section 4.01. No
action by the Agency or the City with reference to this
Amendment No. 2 or related documents shall be deemed to
constitute a waiver of any lawful City requirements which are
applicable to the Si te or to the Developer, any successor in
interest of the Developer or any successor in interest
pertaining to the Site, except by modification or variance
approved by the City consistent with this Amendment No.2.
(c) The Scope of Development set forth in Exhibit "B"
is hereby approved by the Agency upon its execution of this
Amendment No.2. The Site shall be developed and completed in
conformance with the approved Scope of Development and any and
all other plans, specifications and similar development
documents required by this Amendment No.2, 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 shall be deemed to be
approved by the Agency of the preliminary and final construction
plans for the New Homes and preliminary and final landscaping
plans, if such plans approved by the City are reasonably
consistent with the approved Scope of Development.
(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 Site 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 Site, the Developer and the Agency shall
cooperate in efforts to obtain waivers of such revisions, or to
obtain approvals of any such revisions which have been made by
the Developer and have thereafter been approved by the Agency.
The Agency shall not unreasonably withhold or delay approval of
such revisions to the Scope of Development; provided however
SB2002:2242.4
39
e
e
e
that no such change may result in the reduction of the number of
the eight (8) New Homes which shall be constructed by the
Developer and reserved for sale and occupancy by Qualified Home
Buyers.
(e) Notwithstanding any provision to the contrary in
this Amendment No.2, 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 development of the Site and consistent
with this Amendment No.2.
(f) The Developer shall cause landscaping plans in
connection with development of the Site to be prepared by a
licensed landscape architect. The Developer shall prepare and
submit to the City for its approval, preliminary and final
landscaping plans for the Site which are consistent with City
Code requirements. These plans shall be prepared, submitted and
approved wi thin the times respectively established therefor in
the Schedule of Performance as shown on Exhibit "F" attached
hereto and incorporated herein by reference and shall be
consistent with the Scope of Development.
(g) The Developer shall prepare and submit
development plans, construction drawings and related documents
for the development of the Site, including the public
improvements necessary for the development of the Site,
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.
(h) During the preparation of all drawings and plans
in connection with the development of the New Homes and the
public improvements necessary for the development of the Site,
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 fashion.
SB2002:2242.4
40
e (i) The Agency shall have the right to review all
plans, drawings and related documents pertinent to the
development of the Site in order to ensure that they are
consistent with this Amendment No. 2 and with the Scope of
Development set forth in Exhibit "B".
e
(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 Site, 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 Amendment No. 2 within thirty (30) calendar
days following the City's receipt of said plans. Any failure by
the City to approve any of such plans or to issue necessary
permits for the development of the Site within said thirty (30)
calendar day period shall constitute an enforced delay
hereunder, and the Schedule of Performance shall be extended by
that period of time beyond said thirty (30) 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
wi th the City's requirements and in such form and substance so
as to obtain the City's approval thereof.
(k) The Agency shall in good faith use its best
efforts to cause the City to approve in a timely fashion any and
all plans, drawings and documents submitted by the Developer
hereunder and to cause the City not to impose new conditions
inconsistent with: (a) prior plans, drawings and documents
approved by the City or (b) the Scope of Development.
e
(1) The Agency shall approve any modified or revised
plans, drawings and related documents to which reference is made
in this Amendment No. 2 as long as such modified or revised
plans, drawings and related documents are generally consistent
wi th 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 revi"sed plans, drawings and related
SB2002:2242.4
41
e
e
e
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 initoially submitted to the Agency, and if no
specific time for approval if specified then the Agency shall so
approve or 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 3.0l(b) hereof.
(n) The Developer, upon receipt of a notice of
disapproval 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 3.0l(b)
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 Site 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 Site;
and further provided that the City has approved any such minor
882002:2242.4
42
e
e
e
field change to either a New Home or the public improvements
necessary for the development of the Site in accordance with the
standards and practices of the City Building Department and/or
Ci ty 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
condi tions. Nothing contained in this Section 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 Amendment
No.2, the cost of constructing the New Homes and all other
improvements on the Site shall be paid for by the Developer;
provided however, that the Agency shall be obligated to the
Developer to pay the Agency Affordable Housing Sales Grant in an
aggregate amount not to exceed $481,400 in eight (8) equal
installments of $60,175 as provided in Section 2.01.4.
(p-1) Developer shall pay the school capital
facility development improvement fees as required and at the
time specified by the San Bernardino Unified School District.
All other development fees imposed by the City as a condition of
issuance of any permit for the development of the Site 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, at the
close of each New Home Escrow on each Site Lot, pursuant to the
terms of the City of San Bernardino's Development Fee Deferral
program in effect at the Close of Escrow on the Site, if such
deferral program then exists.
(q) 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 Site
hereunder including, but not limited to the public improvements
necessary for the development of the Site and to the
specifications, drawings, plans, maps, permit applications, land
use applications, zoning applications and design review
documents for the New Homes.
(r) The Developer shall pay
including but not limited to the costs
relocation and securing of permits for
for any and all costs,
of design, construction,
utility improvements and
5B2002:2242.4
43
e
e
e
connections, which may be required in developing the Site. The
Developer shall 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 stability of surrounding properties during said
construction.
(s) The Developer shall begin and complete all
construction and development and undertake all obligations and
responsibili ties of the Developer wi thin the times specified in
the Schedule of Performance shown in Exhibit "EN, or within such
reasonable extensions of such times as may be granted by the
Agency or as otherwise provided for in this Amendment No.2.
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 Amendment No.2.
(t) Prior to and during the period of construction of
the New Homes and the public improvements necessary for the
development of the Site the Developer shall submit to the Agency
written progress reports when and as reasonably requested by the
Agency but in no event more frequently than every twelve (12)
weeks. The reports shall be in such form and detail as may
reasonably be required by the Agency. In addition, the
Developer will attend Agency meetings when requested to do so by
Agency Staff.
(u) Prior to the commencement of any construction on
the Site, the Developer shall 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 One Million Dollars ($1,000,000.00) combined single
limi t, naming the Agency and the City as additional insureds.
Said insurance shall cover comprehensive general liability
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 inj ury 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
582002:2242.4
44
e
e
e
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. 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
effecti ve 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
Amendment No. 2 shall be separate and apart from the
requirements of this Amendment No.2. 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 Agency has issued the final Certificate of Completion in
connection with the development of the Site.
(v) The Developer for itself and its successors and
assigns agrees that in the construction of the New Homes and the
public improvements necessary for the development of the Site,
the Developer will not discriminate against any employee or
applicant for employment because of sex, marital status, race,
color, religion, creed, national origin, or ancestry.
Notwithstanding the foregoing, the Developer will use best
efforts to offer employment opportunities to local residents and
will seek to acquire goods and services from local vendors.
(w) The Developer shall carry out its construction of
the improvements of the New Homes and the public improvements
necessary for the development of the Site in conformity with all
applicable laws, including all applicable State labor standards
and requirements and with respect to the development of the
Site.
(x) The Developer shall, at its own expense, secure
or shall cause to be secured, any and all permits which may be
required for such construction, development or work by the City
or any other governmental agency having jurisdiction thereof.
The Agency shall cooperate in good faith with the Developer in
the Developer's efforts to obtain from the City or any other
appropriate governmental agency any and all such permits
including, but not limited to, permits for flags and signs on
the Site and along Highland Avenue and California Street and,
382002:2242.4
45
e
e
e
upon completion of applicable portions of the development of the
Site, certificates of occupancy.
(y) Officers, employees, agents or representatives of
the Agency and the City shall have the right of reasonable
access to the Site, without the payment of charges or fees,
during normal construction hours during the period of
construction for the purposes of this Amendment No. 2 including,
but not limited to, the inspection of the work being performed
in constructing the residences on the Site Such officers,
employees, agents or representatives of the Agency and/or the
City shall be those persons who are so identified by the
Executive Director. Any and all officers, employees, agents or
representatives of the Agency and the City who enter the Site
pursuant hereto shall identify themselves at the job site office
upon their entrance on to the Site and shall at all times be
accompanied by a representative of the Developer while on the
Si te; provided, however, that the Developer shall make a
representative of the Developer available for this purpose at
all times during normal construction hours upon reasonable
notice from the Agency. The Agency shall indemnify, defend and
hold the Developer harmless from injury, property damage or
liability arising out of the exercise by the Agency and/or the
City of this right of access, other than injury, property damage
or liability relating to the negligence of the Developer or its
officers, agents or employees.
(z) The Agency shall inspect relevant portions of the
construction Site prior to issuing any written statements
reflecting adversely on the Developer's compliance with the
terms and conditions of this Amendment No. 2 pertaining to
development of the Site; provided however, that the Developer
has not objected to such an inspection by the Agency or
otherwise prevented the Agency from conducting such an
inspection.
Section 3.02. Agency Mortgage Assistance Proqram.
Under the terms of Amendment No.1, the Agency set aside the sum
of Two Hundred Forty Thousand Dollars ($240,000) in affordable
housing development and preservation funds of the Agency, to
provide purchase money mortgage financing assistance to
Qualified Home Buyers of the completed "Phase I Lots", as this
term is defined in Amendment No.1, under an Agency affordable
housing program known as the Mortgage Assistance Program
("MAP") . In consideration of the covenant of the Developer to
improve the Site as set forth in the Scope of Development, the
Agency hereby agrees to make a sum not to exceed One Hundred
Sixty Six Thousand Dollars ($166,000) available to Qualified
SB2002,2242.4
46
e
e
e
Home Buyers as subordinate or secondary purchase money mortgage
financing in connection with their purchase of a New Home from
the Developer, in accordance with the terms of the Agency's MAP
as then in effect and the following conditions:
(i)
no MAP loan
exceed 10% of
New Home;
a Qualified Home Buyer shall
gross purchase price for the
to
the
(ii) no MAP loan for the Site shall be originated
after August 31, 2003;
(iii) each MAP loan to Qualified Home Buyer shall
comply with the affordable housing mortgage loan
underwriting standards of the Agency as may then
be in effect at the time of the Agency's receipt
of a completed application for a MAP loan from a
Qualified Home Buyer.
Section 3.03. 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 Site
subsequent to the Close of Escrow. Nothing herein contained
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 3.04.
Prohibition Aqainst Transfer.
(a) Prior to the recordation of all Certificates of
Completion with respect to development of the Site as set forth
in Section 3.07 of this Amendment No.2, the Developer shall
not, without prior written approval of the Agency, or except as
permitted by this Amendment No.2, (i) assign or attempt to
assign this Amendment No. 2 or any right herein or (ii) make any
total or partial sale, transfer, conveyance, lease, leaseback,
or assignment of the whole or any part of the Site or the
improvements thereon or permit to be placed on any of the Site
Lots 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
utili ty easements or permits to facilitate the development of
the Site; (2) the assignment of all of the Developer's interest
in this Amendment No. 2 to the Site to a limited liability
company of which the Developer is the managing member (and the
assumption of such interest by such limited liability company);
and (3) sales by the Developer of individual New Homes.
SB2002:2242.4
47
e
e
e
Ib)
[RESERVED - NO TEXT]
Ic) In the absence of specific written agreement or
approval by the Agency, no unauthorized sale, transfer,
conveyance, lease, leaseback or assignment of the Si te shall be
deemed to relieve the Developer or any other party from any
obligations under this Amendment No.2.
(d) Developer is expressly prohibited from leasing or
renting any of the Site Lots, or any structure thereon, pending
final sale to a New Home Buyer.
Section 3.05. Security Financinq; Riqht of Holders.
(a) Notwithstanding any provision of Section 3.04 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 Site are permitted before
the recordation of any Certificate of Completion (referred to in
Section 3.07 of this Amendment No.2). The Developer shall
notify the Agency in writing in advance of any mortgage, deed of
trust, or other form of lien for financing if the Developer
proposes to enter into the same before the recordation of any
Certificate of Completion. 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 Site, 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 improvements on the Site
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.
herein
Ic)
shall
The words
be deemed
trust" as
customary
used
and
"mortgage" and "deed of
to include all other
582002:2242.4
48
e
e
e
appropriate modes of
development. The
regarding the rights
reasonably require.
financing real estate construction and land
Agency agrees to make such amendments
of any lender as the approved lender shall
(d) The holder of any mortgage, deed of trust or
other security interest authorized by this Amendment No. 2 shall
in no manner be obligated by the provisions of this Amendment
No. 2 to construct or complete the improvement of the Site or to
guarantee such construction or completion; provided however,
that each surety under the completion and payment surety bonds
deli vered by the Developer to the City of San Bernardino under
the terms of the Subdivision Improvement Agreement shall not, by
the virtue of any term of this Amendment No.2, be deemed to be
discharged from its obligation to the City as arises under such
surety and the Subdivision Improvement Agreement. Nothing in
this Amendment No. 2 shall be deemed to permit or authorize any
such holder to devote the Site to any other use, or to construct
any other improvement thereon, except those uses or improvements
provided for or authorized by this Amendment No.2.
(e) Whenever the Agency shall deliver any notice or
demand to the Developer with respect to any breach or default by
the Developer in the completion of construction of the New Homes
or the Site Pubic Improvements, or any breach or default of any
other obligations which, if not cured by the Developer, entitle
the Agency to terminate this Amendment No. 2 or exercise its
right to re-enter the Site, or a portion thereof under Section
5.07, the Agency shall at the same time deliver to each holder
of record of any mortgage, deed of trust or other security
interest authorized by this Amendment No. 2 a copy of such
notice or demand. Each such holder shall (insofar as the rights
of the Agency are concerned) have the right, at its option, to
commence the cure or remedy of any such default and to
diligently and continuously proceed with such cure or remedy,
within sixty (60) calendar days after the receipt of the notice;
and to add the cost thereof to the security interest debt and
the lien of its security interest. If such default shall be a
default which can only be remedied or cured by such holder upon
obtaining possession, such holder shall seek to obtain
possession with diligence and continuity through a receiver or
otherwise, and shall remedy or cure such default wi thin sixty
(60) calendar days after obtaining possession; provided that in
the case of a default which cannot with diligence be remedied or
cured, or the remedy or cure of which cannot be commenced,
within such sixty (60) calendar day period, such holder shall
have such additional time as is reasonably necessary to remedy
or cure such default of the Developer. Nothing contained in
8B2002:2242.4
49
e
e
e
this Amendment No. 2 shall be deemed to permit or authorize such
holder to undertake or continue the construction or completion
of the improvements (beyond the extent necessary to conserve or
protect the improvements or construction already made) without
first having expressly assumed the Developer's obligations by
written agreement satisfactory to the Agency. The holder in
that event must agree to complete, in the manner provided in
this Amendment No.2, the improvements to which the lien or
ti tIe of such holder relates and must submit evidence
satisfactory to the Agency that it has the qualifications and
financial responsibility necessary to perform such obligations.
Any such holder completing such improvements in accordance
herewith shall be entitled, upon written request made to the
Agency, to be issued appropriate Certificates of Completion by
the Agency.
(f) In any case where, one hundred eighty (180)
calendar days after default by the Developer under the terms of
a security interest authorized by this Amendment No.2, the
holder of any such mortgage, deed of trust or other security
interest creating a lien or encumbrance upon the Site or any
portion thereof has not exercised the option to construct the
applicable portions of the Site, or has exercised the option but
has not proceeded diligently and continuously with the
completion of the improvements to the Site, then in such event,
the Agency may purchase the mortgage, deed of trust or other
security interest by payment to the holder of the amount of the
unpaid debt, including principal, accrued and unpaid interest,
la te charges, costs, expenses and other amounts payable to the
holder by the Developer under the loan documents between holder
and the Developer. If the ownership of the Site has vested in
the holder, the Agency, if it so desires, shall be entitled to a
conveyance from the holder to the Agency upon payment to the
holder of an amount equal to the sum of the following:
1. The unpaid mortgage, deed of trust or other
security interest debt, including principal,
accrued and unpaid interest, late charges, costs,
expenses and other amounts payable to the holder
by the Developer under the loan documents between
the holder and the Developer, at the time title
became vested in the holder (less all appropriate
credits, including those resulting from
collection and application of rentals and other
income received during foreclosure proceedings.)
2 .
All expenses, if any, incurred by the holder with
respect to foreclosure.
382002:2242.4
50
e
e
e
3.
The net expenses, if any (exclusive of general
overhead), incurred by the holder as a direct
resul t of the subsequent ownership or management
of the Site, such as insurance premiums and real
estate taxes.
4. The cosf of any improvements made by such holder.
5. An amount equivalent to the interest that would
have accrued on the aggregate on such amounts had
all such amounts become part of the mortgage or
deed of trust debt and such debt had continued in
existence to the date of payment by the Agency.
6.
After expiration of the aforesaid one hundred
eighty (180) calendar day period, the holder of
any mortgage, deed of trust or other security
affected by the option created by this Section,
may demand, in writing, that the Agency act
pursuant to the option granted hereby. If the
Agency fails to exercise the right herein granted
wi thin sixty (60) calendar days from the date of
such written demand, the Agency shall be
conclusively deemed to have waived such right of
purchase of the applicable portion of the Site or
the mortgage, deed of trust or other security
interest.
(g) 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 Site (or any portion thereof) prior
to the issuance of a Certificate of Completion for the Site (or
any portion thereof), and the holder has not exercised its
option to complete the development, the Agency may cure the
default but is under no obligation to do so prior to completion
of any foreclosure. In such event, the Agency shall be entitled
to reimbursement from the Developer of all costs and expenses
incurred by the Agency in curing the default. The Agency shall
also be deemed to have a lien of the Agency as may arise under
this Section 3.05 (g) upon the Site (or any portion thereof) to
the extent of such costs and disbursements. Any such lien shall
be subordinate and subject to mortgages, deeds of trust or other
securi ty instruments executed by the Developer for the purpose
of obtaining the funds to construct and improve the Site as
authorized herein.
582002:2242.4
51
e
e
e
Section 3.06. Riqht of the Aqency to Satisfy Other
Liens on the Site after Conveyance of Title. After the
conveyance of title to the Site by the Agency to the Developer
and prior to the recordation of all Certificate of Completion
(referred to in Section 3.07 of this Amendment No.2), and after
the Developer has had a reasonable time to challenge, cure or
satisfy any unauthorized liens or encumbrances on the Site, the
Agency shall after sixty (60) calendar days prior written notice
to the Developer have the right to satisfy any such liens or
encumbrances; provided, however, that nothing in this Amendment
No. 2 shall require the Developer to payor make provisions for
the payment of any tax, assessment, lien or charge so long as
the Developer in good faith shall contest the validity or amount
thereof, and so long as such delay in payment shall not subject
the Site or any portion thereof, to forfeiture or sale.
Section 3.07. Certificate of Completion.
(a) Following the written request therefor by the
Developer and the completion of construction of each New Home,
excluding minor building "punch-list" items to be completed by
the Developer upon such New Home, the Agency shall furnish the
Developer with a Certificate of Completion for the New Home as
applicable, substantially in the form set forth in Exhibit "G"
attached hereto, and such Certificate of Compliance shall be
recorded at the time of close of the New Home Escrow for such
New Home if requested by the Developer. Notwithstanding any
provision set forth herein to the contrary, the completion of
construction of the New Home improvements on a Site Lot shall
include the completion of construction of a residence on said
Site Lot and any and all on-site parking, front yard and
landscaping and related improvements necessary to support or
which meet the requirements applicable to occupancy of the New
Home.
(b) The Agency shall not unreasonably withhold the
issuance of a Certificate of Completion. A Certificate of
Completion shall be, and shall so state, that it is a conclusive
determination of satisfactory completion of all of the
obligations of this Amendment No. 2 with respect to the
improvement of the New Home to which it corresponds. After the
recordation of the Certificate of Completion, any party then
owning or thereafter purchasing, leasing or otherwise acquiring
any interest in the New Homes shall not (because of such
ownership, purchase, lease or acquisition) incur any obligation
or liability under this Amendment No.2, except that such party
shall be bound by any covenants contained in the grant deed or
other instrument of transfer which grant deed or other
5B2002:2242.4
52
e
e
e
instrument of transfer shall include the provisions of Section
4.01 through 4.05, inclusive, of this Amendment No.2. Neither
the Agency nor any other person, after the recordation of a
Certificate of Completion for a New Home, shall have any rights,
remedies or controls that it would otherwise have or be entitled
to exercise under this Amendment No. 2 with respect to such New
Home, as a result of a default in or breach of any provision of
this Amendment No.2, and the respective rights and obligations
of the parties shall be limited to those set forth in the grant
deed.
Ic) Any Certificate of Completion shall be in such
form as to permit it to be recorded in the Recorder's Office of
San Bernardino County.
Id) If the Agency refuses or fails to furnish a
Cert.ificate of Completion for a New Home after written request
from the Developer, the Agency shall, within fifteen (15)
calendar days of the written request or within three (3)
calendar days after the next regular meeting of the Agency,
whichever date occurs later, provide to the Developer a written
statement setting forth the reasons with respect to the Agency's
refusal or failure to furnish a Certificate of Completion. The
statement shall also contain the Agency's opinion of the action
the Developer must take to obtain a Certificate of Completion.
If the reason for such refusal is confined to the immediate
unavailability of specific items or materials for construction
or landscaping at a price reasonably acceptable to the Developer
or other minor building "punch-list" items, the Agency may issue
its Certificate of Completion upon the posting of a bond or
irrevocable letter of credit, reasonably approved as to form and
substance by the Agency Counsel and obtained by the Developer in
an amount representing a fair value of the work not yet
completed as reasonably determined by the Agency. If the Agency
shall have failed to provide such written statement within the
foregoing period, the Developer shall be deemed conclusively and
without further action of the Agency to have satisfied the
requirements of this Amendment No. 2 with respect to the Site
Lot as if a Certificate of Completion had been issued therefor.
(e) A Certificate of Completion shall not constitute
evidence of compliance with or satisfaction of any obligation of
the Developer to any holder of a mortgage, or any insurer of a
mortgage securing money loaned to finance the improvements
described herein, or any part thereof. A Certificate of
Completion shall not be deemed to constitute a notice of
completion as referred to in Section 3093 of the California
Civil Code, nor shall it act to terminate the continuing
5B2002:2242.4
53
e
e
e
covenants or conditions subsequent contained in the Agency Grant
Deed.
ARTICLE IV
USE OF THE SITE
Section 4.01. Uses.
(a) Developer covenants and agrees for itself, its
successors, and assigns that at least twenty percent (20%) of
the New Homes to be developed, constructed and improved on the
Site (e.g., not less than eight (8) such New Homes), shall be
reserved for sale and occupancy by Qualified Home Buyers whose
Adjusted Family Income at the time of initial occupancy of each
New Home does not exceed the household income qualification
limits of a Moderate-Income Household.
The Developer shall cause to be recorded at the time
of close of each New Home Escrow for each of the eight (8) New
Homes which the provisions of this Section 4.01 (a) are
applicable (e. g. , on the Deli very Date) the form of the
community redevelopment affordability covenants and restrictions
substantially in the form as attached hereto Exhibit "H." The
final form of Exhibit "H" shall be delivered to the escrow
holder for execution by the Developer and the Qualified Home
Buyer at the time of close of each applicable New Home Escrow.
The selection of the eight (8) individual New Homes in the Site
which shall be subject to the provisions of this Section 4.01(a)
shall be at the discretion of the Developer. I f the Qualified
Home Buyer may use Agency MAP funds for the purchase of the New
Home from the Developer, the Qualified Home Buyer and the Agency
shall execute a separate set of redevelopment affordability
covenants in favor of the Agency to evidence the obligation of
the Qualified Home Buyer to the Agency which arise by virtue of
the Qualified Home Buyer's acceptance of Agency MAP Funds under
the Agency MAP program.
The covenant of this Section 4.01 (a) shall run with
the land.
(b) The Developer further covenants and agrees for
itself, its successors and assigns that the Site shall be
improved, developed and used in accordance with the Scope of
Development. Developer covenants to develop and use the Site
in conformity with all applicable laws.
The covenants of this Section 4.01 (b) shall also run
with the land.
882002:2242.4
54
e
e
e
(c) It is understood and agreed by the Developer that
until such time as a Certificate of Completion is recorded for a
New Home, that neither the Developer, nor its assigns or
successors shall use or otherwise sell, transfer, convey,
assign, lease, leaseback or hypothecate any Site Lot or any
portion thereof to any entity or party, or for any, that is
partially or wholly exempt from the payment of real property
taxes pertinent to such Site Lot, or any portion thereof, or
which would cause the exemption of the payment of all or any
portion of such real property taxes.
renting
thereon,
(d) Developer is
any of the Site
pending final sale
expressly prohibited from leasing or
Lots, or any New Home constructed
to a New Home Buyer.
Section 4.02. Maintenance of the Site. The Developer
covenants and agrees for itself, its successors, and assigns to
maintain the Site 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 at the Site 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 the Site and
undertake, such maintenance activities. In such event, the
Developer shall reimburse the Agency for all reasonable sums
incurred by it for such maintenance acti vi ties. The obligation
of the Developer under this Section 4.02 wi th respect to the
Site Lots shall be discharged for each Site Lot at such time as
a Certificate of Completion for the New Home is recorded.
Section 4.03. Obligation to Refrain from
Discrimination. The Developer covenants and agrees for itself,
its successors, its assigns and every successor in interest to
the Site or any part thereof, 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 the
Si te; 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 Site.
SB2002:2242.4
55
e
e
e
Section 4.04. Form of Nondiscrimination and
Nonsegreqa tion Clauses. The Developer covenants and agrees for
itself, its successors, its assigns, and every successor in
interest to the Site 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 enj oyment of the Site (or any part thereof) 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, use, or occupancy, of tenants lessees, sublessee,
subtenants, or vendees in the premises herein leased."
(c) In
against
account
contracts: "There shall be no
or segregation of any person or group
of race, color, creed, religion,
discrimination
of persons on
sex, marital
382002:2242.4
56
e
e
e
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 4.05. Effect and Duration of Covenants. The
covenants established against discrimination shall remain in
effect in perpetuity. The covenants respecting uses and
occupancy of each of the eight (8) New Homes which are
designated by the Developer to be initially occupied by a
Qualified Home Buyer 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 Amendment No. 2 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 inj uncti ve relief. The
Agency shall have the right to assign all of its rights and
benefits hereunder to the City.
ARTICLE V
DEFAULTS, REMEDIES AND TERMINATION
Section 5.01.
Defaults - General.
(a) Subj ect 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 Amendment No. 2 shall constitute a
default under this Amendment "No. 2; provided, however, that if a
SB2002:2242.4
57
e
e
e
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 shall 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 specifically set forth in this
Amendment No.2, then within said time limits), such party shall
not be deemed to be in default hereunder.
Ib) The inj ured party shall give written notice of
default to the party in default, specifying the default
complained of by the non-defaulting party. Delay in giving such
notice shall not constitute a waiver of any default nor shall it
change the time of default.
(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
insti tute and maintain any actions or proceedings which it may
deem necessary to protect, assert or enforce any such rights or
remedies.
Section 5.02. Leqal 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
Amendment No.2. 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 Amendment No.2.
(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 John Pavelak (or
582002:2242.4
58
e
e
e
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 Amendment No.2, 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. Damaqes If either party defaults with
regard to any provision of this Amendment No. 2 following the
Close of Escrow, 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
defaul t wi thin thirty (30) calendar days after service of the
notice of default and promptly complete the cure of such default
wi thin a reasonable time, not to exceed ninety (90) calendar
days (or such shorter period as may otherwise be specified in
this Amendment No. 2 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.
Section 5.05. Specific Performance. If either party
defaults under any of the provisions of this Amendment No. 2
following the Close of Escrow, the non-defaulting party shall
serve written notice of such default upon such defaulting party.
If the defaulting party does not commence to cure the default
and diligently and continuously proceed with such cure wi thin
thirty (30) calendar days after service of the notice of
default, and such default is not cured within a reasonable time
thereafter (and where any time limits for the completion of such
cure, correction or remedy are specifically set forth in this
Amendment No.2, then within said time limits), the non-
defaulting party, at its option, may institute an action for
specific performance of the terms of this Amendment No.2,
except as otherwise provided in this Amendment No.2.
Section 5.06. Aqency Rights of Termination Following
Close of Escrow.
specify
(a)
the
Subject to written notice of default
Developer's default and the action
which shall
required to
882002:2242.4
59
e
e
e
commence cure of same and upon thirty (30) calendar days notice
to the Developer of the Agency's intent to terminate this
Amendment No. 2 pursuant to this Section, the Agency at its
option may terminate this Amendment No. 2 following the Close of
Escrow, if the Developer in breach of this Amendment No. 2
assigns or attempts to assign this Amendment No.2, or any right
therein, or attempts to make any total or partial sale, lease or
leaseback, transfer or conveyance of the whole or any part of
the Site or the improvements to be developed thereon in
violation of the terms of this Amendment No.2, and the
Developer does not correct such violation within thirty (30)
calendar days from the date of receipt of such notice.
(b) Subject to written notice of default, which shall
specify the Developer's default and the action required to
commence cure of same and upon thirty (30) calendar days notice
to the Developer of the Agency's intent to terminate this
Amendment No. 2 pursuant to this Section, following the Close of
Escrow, the Agency at its option may terminate this Amendment
No. 2 if the Developer: (a) does not within the time limits set
forth in this Amendment No. 2 or as specifically provided in the
Schedule of Performance, subject to extensions authorized by
this Amendment No. 2 due to force maj eure or otherwise, submit
development plans, construction drawings and related documents
acceptable to the Planning Department and Building Division of
the City for plan check purposes and in order to obtain building
permi ts for the improvement of the Site, together with
applicable fees therefor, all prepared to the minimum acceptable
standards as required by the Planning Department and Building
Division of the City for commencement of formal review of such
documents and as required by this Amendment No.2, or (b) does
not carry out its other responsibilities under this Amendment
No. 2 or in accordance with any modification or variance,
precise plan, design review and other environmental or
governmental approvals and such default is not cured or the
Developer does not commence and diligently and continuously
proceed with such cure within thirty (30) calendar days after
the date of receipt of written demand therefor from the Agency.
582002:2242.4
60
e
e
e
Section 5.07. Riqht to Reenter, Repossess and Revest.
(a) Following the Close of Escrow, the Agency shall,
upon thirty (30) calendar days notice to the Developer which
notice shall specify this Section 5.07, have the right, at its
option, to re-enter and take possession of all or any portion of
the Site together with all improvements thereon, and to
terminate and revest in the Agency the estate conveyed to the
Developer hereunder, if after conveyance of title, the Developer
(or its successors in interest) shall:
1. Fail to commence construction of all or any
portion of the improvements as required by this
Amendment No. 2 for a period of ninety (90)
calendar days after written notice to proceed
from the Agency; provided that the Developer
shall not have obtained an extension or
postponement to which the Developer may be
entitled pursuant to Section 6.05 hereof; or
2 .
Abandon or substantially suspend construction of
all or any portion of the improvements at the
Si te for a period of ninety (90) calendar days
after written notice of such abandonment or
suspension from the Agency; provided that the
Developer shall not have obtained an extension or
postponement to which the Developer may be
entitled to pursuant to Section 6.05 hereof; or
3. Assign or attempt to assign this Amendment No.2,
or any rights herein, or transfer, or suffer any
involuntary transfer, of the Site or any part
thereof, in violation of this Amendment No.2,
and such violation shall not have been cured
wi thin thirty (30) calendar days after the date
of receipt of written notice thereof from the
Agency to the Developer.
4. Fails to cause at least eight (8) New Homes to be
reserved for sale and occupancy by Qualified Home
Buyers.
(b) The thirty (30) calendar day written notice
specified in this Section shall specify that the Agency proposes
to take action pursuant to this Section and shall specify which
of the Developer's obligations set forth in Subsections (1)
through (4) of Section 5.07 (a) have been breached. The Agency
shall proceed with its remedy set forth herein only in the event
SB2002:2242.4
61
e
e
e
that
for
the Developer continues in default of said obligation (s:
a period of thirty (30) calendar days following such notice
upon commencing to cure such default, fails to diligently
continuously prosecute said cure to satisfactory conclusion.
or,
and
(c) The right of the Agency to terminate this
Amendment No. 2 and reenter, repossess and revest in title in
such portion of the Site as not then affected by Certificates of
Completion shall be subject and subordinate to, shall be limited
by and shall not defeat, render invalid or limit:
1.
Any mortgage, deed of trust or other
interest permitted by this Amendment No.
security
2;
2. Any rights or interests provided in this
Amendment No. 2 for the protection of the holders
of such mortgages, deeds of trust or other
security interests;
3 .
Any leases, declarations of covenants, conditions
and restrictions, easement agreements or other
recorded documents previously approved or
authorized by the Agency and applicable to the
Site.
(d) The Agency Grant Deed for the Site conveyed to
the Developer shall contain appropriate references and
provisions to give effect to the Agency's right, as set forth in
this Section under specified circumstances prior to the
recordation of a Certificate of Completion with respect to such
portion of the Site to reenter and take possession of such
portion, or any part thereof, with all improvements thereon, and
to terminate and revest in the Agency the estate conveyed to the
Developer.
(e) Upon the revesting in the Agency of title to the
Si te or any part thereof, as provided in this Section, the
Agency shall, pursuant to its responsibilities under State law,
use its best efforts to resell the Site, or any part thereof, at
fair market value as soon and in such manner as the Agency shall
find feasible and consistent with the objectives of such law, to
a qualified and responsible party or parties (as determined by
the Agency) who will assume the obligations of making or
completing the improvements, or such other improvements in their
stead as shall be satisfactory to the Agency and in accordance
with the uses specified for the property, or any part thereof.
Upon such resale of the Site , or any part thereof, the proceeds
thereof shall be applied:
SB2002:2242.4
62
e
e
e
SB2002:2242.4
1.
First, to make any payment made or necessary to
be made to discharge or prevent from attaching or
being made any subsequent encumbrances or liens
due to obligations incurred with respect to the
making or completion of the agreed improvements
or any. part thereof on the Site or any portion
thereof;. next to reimburse the Agency on its own
behalf or on behalf of the City for all actual
costs and expenses incurred by the Agency and the
Ci ty, including but not limited to customary and
reasonable fees or salaries to third party
personnel engaged in such action (but excluding
the Agency's or the City's general overhead
expense), in connection with the recapture,
management and resale of the Site or any portion
thereof; all taxes, assessments and water and
sewer charges paid by the City and/or the Agency
with respect to the Site or any portion thereof;
any amounts otherwise owing to the Agency by the
Developer and its successor transferee; and
2.
Second, to the extent that any and all funds
which are proceeds from such resale are
thereafter available, to reimburse the Developer,
or its successor transferee, up to the amount
equal to the sum of: (1) the Purchase Price paid
by the Developer for the Site (or allocable to
the applicable part thereof); and (2) the costs
incurred for the development of the Site, or
applicable part thereof, or for the construction
of the improvements thereon including, but not
limited to, costs of carry, taxes and items set
forth in the Developer's cost statement which
shall be submitted to and approved by the Agency.
3.
Any balance
application of
Agency.
remaining after the foregoing
proceeds shall be retained by the
63
e
e
e
ARTICLE VI
GENERAL PROVISIONS
Section 6.01. Notices,
Between the Parties.
Demands
and
Communications
(a) Any and. all notices, demands or communications
submitted by any party to another party pursuant to or as
required by this Amendment No. 2 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
1.04(a) and Section 1.04(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
designa te 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
recei ved 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:
Century Crowell Communities, L.P.
1535 South "D" Street, Suite 200
San Bernardino, CA 92408
Attn: John Pavelak
FAX: (909) 381-0041
with copy to:
Best, Best & Krieger
3750 University Ave., Ste 400
Riverside, CA 92502
Attn: Mike Grant
FAX: (909) 686-3083
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, 0' Arnato, Brisbois &
Bisgaard
650 East Hospitality Lane,
Suite 600
San Bernardino, CA 92408
FAX: (909) 387-1130
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 Amendment No.2,
or in the development of the Site, shall participate in any
decision relating to the Amendment No.2. The parties represent
and warrant that they do not have knowledge of any such conflict
of interest.
882002:2242.4
64
e
e
e
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 Amendment No.2.
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. Nonliability of Agency Officials and
Employees. 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
Amendment No.2, except for gross negligence or willful acts of
such member, officer or employee.
Section 6.05. Enforced Delay: Extension of Time of
Performance. In addition to specific provisions of this
Amendment No.2, 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
faul t 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 inj unction
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
satisfactory commitment from
improvement of the Site or to
this Amendment No. 2 relating
the Developer to obtain a
a construction lender for the
satisfy any other condition of
to the redevelopment of the Site
382002:2242.4
65
e
e
e
shall not be deemed 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 Amendment
No. 2 and which occur at any time after the execution of this
Amendment No.2, 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 Amendment No.2. 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 Amendment No. 2 could impose an inconvenience or hardship
on the continued performance of such party under this Amendment
No.2, 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 Amendment No.2.
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 Site, and/or the development
thereof, as necessary for the Agency, in its reasonable
discretion, to enforce its rights under this Amendment No.2.
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
Amendment No.2.
Section 6.07. Approvals.
(a) Except as otherwise provided in this Amendment
No.2, 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 Amendment No. 2 which are of routine or technical nature,
including minor adjustments to the Schedule of Performance.
5B2002,2242.4
66
e
e
e
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 from or related to this
Amendment No.2.
Section 6.09. Indemnification. The Developer agrees
to indemnify and hold the City and the Agency, and their
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 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.
Section 6.10. Release of Developer from Liability.
Notwithstanding any provision herein to the contrary, the
Developer shall be relieved of any and all liability for the
obligations of the Developer hereunder with regard to any Site
Lot when a Certificate of Completion has been issued by the
Agency hereunder with respect thereto, other than any covenants
and obligations provided by the grant deed by which the Site is
conveyed to the Developer hereunder.
Section 6.11. Attorneys I Fees. If either party
hereto files any action or brings any action or proceeding
against the other arising out of this Amendment No.2, 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' feesN 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 6.12. Effect. This Amendment No. 2 shall be
binding upon and inure to the benefit of the parties hereto and
their respective heirs, executors, administrators, legal
representatives, successors and assigns.
5B2002:2242.4
67
e
e
e
ARTICLE VII
ENTIRE AGREEMENT, WAIVERS AND AMENDMENT
Section 7.01. Entire Agreement.
(a) This Amendment No. 2 shall be executed in three
(3) triplicate originals each of which is deemed to be an
original. This Amendment No. 2 includes pages and nine (9)
attachments (See list of attachments at Section 1.06), which
constitute the entire understanding and Agreement of th~
parties.
(b) This Amendment No. 2 integrates all of the terms
and conditions mentioned herein or incidental hereto, and
supersedes all negotiations or previous agreements between the
parties with respect to all or any portion of the Site and the
development thereof.
(c) None of the terms, covenants, agreements or
conditions set forth in this Amendment No. 2 shall be deemed to
be merged with the grant deed conveying title to the Developer
in the Site, and this Amendment No. 2 shall continue in full
force and effect before and after such conveyance until issuance
of the final Certificate of Completion.
(d) All waivers of the provisions of this Amendment
No. 2 and all amendments hereto must be in writing and signed by
the appropriate authorities of the Agency and the Developer.
ARTICLE VIII
TIME FOR ACCEPTANCE OF AGREEMENT BY AGENCY AND RECORDATION
Section 8.01.
Agreement. .
Execution and Recordation of Notice of
(a) Following its execution by the Developer and
prompt deli very thereafter to the Agency, this Amendment No. 2
shall be subject to the review and approval by the governing
board of the Agency in its sole and absolute discretion within
forty-five (45) calendar days after the date of signature by the
Developer. In the event that the Agency has not approved,
executed and delivered this Amendment No. 2 to the Developer
within the foregoing period, then the parties shall be mutually
released from any further duties or obligations hereunder. The
date of this Amendment No. 2 shall be the date when the
Amendment No.2 shall have been approved by the Agency.
382002:2242.4
68
e
e
e
(b) The Developer and the Agency agree to permit
recordation of a Notice of Agreement against the Site in the
Office of the County Recorder of San Bernardino County. The
form of such Notice of Agreement is attached hereto as Exhibit
"I".
SB2002:2242.4
69
e
e
e
i'"Jar"" 21 U~ U::.: 1 /p
p.3
IN ~=~!ESS ~r.ER~O?,
e;<.ec".Jted th:..s }t.._""':"~enliL"Tl.e:1t No. 2 as
the par~ies here~o have duly
0= the dates set forth belo~.
AGENCY
Redevelopme~t Agency of the
City of San Bernardino
Date:
By:
Age~cy Chair
By:
Agency Exec~tive Director
AP?~OVE~ AS TO ?O~J:
Agency Special Counsel
DEVEc.OPER
Ce~tury Crowell Corr~uniti8s,
L.P., a Cali=ornia limited
partnership
By Century Homes Corrmunities,
a California corporation, its
eral partner
Date:
- ,.....
Jo:m "1. Pave:i.ak
?resident
sa.20')2;211i2.4
70
e
e
e
EXHIBIT "A"
LEGAL DESCRIPTION
SITE
$82002:2242.4
Exh. "A" - 1
e
e
e
EXHIBIT "A-l"
LEGAL DESCRIPTION
MODEL HOME LOTS
SB2002:2242.4
Exh. "A-l" - 1
e
e
e
EXHIBIT "Bn
SCOPE OF DEVELOPMENT
The Site shall be developed as follows: thirty eight (38) single
family detached residential units on the Site. The Site shall
be developed in accordance with this Amendment No.2, but
subject to the requirements of the subdivision map, zoning
ordinance of the City and any variances or modifications
therefrom as approved by the City.
The Developer shall effect the design and construction with
respect to the development of the Site in accordance with the
Schedule of Performance (Exhibit "E") and this Amendment No. 2
as follows:
The Site will be developed with thirty-eight (38) single family
irleqatlned bjre:5iLt:i'ftnLalil3. aruhiapproaadls applicaed:es$:Sla1l::f1e ~LilbEis6a!ilmg
be installed.
The development shall be first class, constructed of quality
materials, to City Code, and shall be unified in architectural
theme and treatment throughout the Site and adjacent off-site
areas, insofar as reasonable and practicable.
All improvements to be constructed by the Developer shall be
constructed or installed in accordance with the technical
specifications, standards and practices of the City and all
governing agencies and in accordance with plans and
specifications approved by the City.
The Developer shall cause the
fees paid to all governmental
utilities, for applications
approvals.
proper documents to be filed and
or regulatory agencies, including
for all required permits and
The Developer shall at its cost and expense undertake and
complete any and all soils, utility and drainage studies, plans
and reports that may be necessary in connection with the
development of the Site and shall provide a copy of said studies
and reports to the Agency. Said studies and reports shall be
completed prior to the issuance of any building permits for the
Site.
SB2002:2242.4
Exh. "B" - 1
,
------~
e
e
e
EXHIBIT MC"
[RESERVED - NO TEXT/NO EXHIBIT MC"]
SB2002:2242.4
Exh. "C" - 1
e
e
e
EXHIBIT "0"
FORM OF AGENCY GRANT DEED
882002:2242.4
Exh. "0" - 1
e
e
e
EXHIBIT "E"
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
TEMPORARY LICENSE AGREEMENT FOR THE GRADING OF LAND
(Century Crowell Communities)
THIS TEMPORARY LICENSE AGREEMENT FOR THE GRADING OF LAND
(this "License Agreement") is dated as of 2002, by
ihIillJiitaatWp!GI!nnefKNTtlRY( "~j. cnOMM111NII"I)IES-Jld Ltl!le, RflDE!JlUCilI"!!IENTa
AGENCY OF THE CITY OF SAN BERNARDINO, a public body corporate
and politic (the "Agency"), and is entered into with respect to
the facts set forth in the Recitals:
RECITALS
1. This License Agreement affects the lands owned by the
Agency, which is hereinafter described as the "Grading Site."
The Grading Site is subj ect to disposition by the Agency to
Century Crowell in accordance with the terms of an agreement
dated as of April 2002, entitled "Second Amended and
Resta ted Disposition and Development Agreement," by and between
the Agency and Century Crowell. A vicinity map marked to show
the Grading Site in relation to other abutting lands is attached
to this License Agreement as Exhibit "A";
2. The Grading Site is described in the attached Exhibit
"B".
IN CONSIDERATION OF THE MUTUAL PROMISES OF THE PARTIES SET
FORTH IN THIS LICENSE AGREEMENT AND OTHER GOOD AND VALUABLE
CONSIDERATION, THE RECEIPT AND SUFFICIENCY OF WHICH IS HEREBY
ACKNOWLEDGED, CENTURY CROWELL AND THE AGENCY HEREBY AGREE, AS
FOLLOWS:
Sect~on 1. Definitions. In addition to the definitions
of certain words set forth in the Recitals or elsewhere in this
License Agreement, the following words or phrases shall have the
meanings set forth below:
. Contractor. The term "Contractor" refers to any person or
enti ty that Century Crowell retains as general contractor
882002:2242.4
Exh. "E" - 1
e
e
e
to conduct the Work (hereinafter defined) on the Grading
Site, but shall not refer to subcontractors of Contractor.
.
Work. The term "Work" means and refers to the grading of
dirt on the Grading Site pursuant to the work plan attached
hereto as Exhibit "C". The Work includes the right to
water, grade and fence the Grading Site. The Work shall
not include the construction or installation of any
improvements on the Grading Site other than fences and
temporary utilities without the prior written approval of
the Agency.
. Hazardous Substances. The term "Hazardous Substances" means
any pollutant, contaminant, waste and any toxic,
carcinogenic, reactive, corrosive, ignitable, flammable or
infectious chemical, chemical compound or substance or
otherwise hazardous wastes, toxic or contaminated
substances or similar materials, including, without
limitation, any quantity of asbestos, urea formaldehyde,
PCBs, radon gas, crude oil or any fraction thereof, all
forms of natural gas, petroleum products, by-products or
derivatives, radioactive substances, methane, hydrogen
sulfide or materials, pesticides, waste waters, or sludges,
any of the above of which are subject to regulation,
control or remediation under any Environmental Laws (as
defined below) .
. Environmental. Laws. The term "Environmental Laws" means all
applicable federal, state and local laws, statutes,
ordinances, rules, regulations, orders and judgments
relating to the protection or clean-up of the environment,
the use, treatment, storage, transportation, generation,
manufacture, processing, distribution, handling or disposal
of, or emission, discharge or other release or threatened
release of Hazardous Substances, the preservation or
protection of waterways, groundwater, drinking water, air,
wildlife, plants or other natural resources, the health and
safety of persons or property, or the protection of the
health and safety of employees, as the same may be amended,
modified or supplemented from time to time, including,
without limitation: the Clean Air Act, as amended, 42
U.S.C. Section 7401 et seq.; the Federal Water Pollution
Control Act, as amended, 33 U.S.C. Section 1251 et seq.;
the Resource Conservation and Recovery Act of 1976, as
amended, 42 U.S.C. Section 6901 et seq.; the Comprehensive
Environment Response, Compensation and Liability Act of
1980, as amended (including the Superfund Amendments and
882002:2242.4 Exh. "E" - 2
e
e
e
Reauthorization Act of 1986, "CERCLAn), 42 U.S.C. Section
9601 et seq.; the Toxic Substances Control Act, as amended,
15 U.S.C. Section 2601 et seq.; the Occupational Safety and
Health Act, as amended, 29 U.S.C. Section 651, the
Emergency Planning and Community Right-to-Know Act of 1986,
42 U. S. C. Section 11001 et seq.; the Safe Drinking Water
Act, as amended, 42 U.S.C. Section 300f et seq.; the
California Health and Safety Code Is 25100 et ~, S
25249.5 et ~, S 39000 et ~), the California Water
Code (s 13000 et ~); all comparable state and local
laws, laws of other jurisdictions or orders and
regulations; and any and all common law requirements, rules
and bases of liability regulating, relating to or imposing
liabili ty or standards of conduct concerning pollution or
protection of human health or the environment, as now or
may at any time hereafter be in effect.
Section 2. Effective Date of License Aqreement. This
License Agreement shall take effect (the "Effective Daten) on
the date of the last of the following to occur: 11) this License
Agreement is approved and executed by the Executive Director of
the Agency (2) this License Agreement is executed by the
authorized representatives of Century Crowell and (3) Century
Crowell has delivered to the Executive Director the evidence of
insurance as required under Section l2(a) and the completion and
payment bonds to the Agency as set forth in Section l2(c).
Section 3. [RESERVED - NO TEXT]
Section 4. Covenants and Aqreements.
(a) Century Crowell covenants and agrees that in the
performance of the Work, it and all its employees, contractors
and subcontractors will comply with all applicable Environmental
Laws relating to the presence of Hazardous Substances on the
Grading Site.
(b) Century Crowell, at its expense, will obtain all
governmental approvals required for the performance of the Work
and will perform the Work substantially in compliance with the
grading plans ("Grading Plans") submitted to and approved by the
City of San Bernardino.
(c) Century Crowell covenants
performing the Work on the Grading Site
efforts not to unreasonably interfere
and agrees
it will use
with the
that in
reasonable
access of
SB2002:2242.4
Exh. "E" - 3
e
e
e
adj acent landowners or their tenants to their property or the
operations of adjacent landowners or tenants upon such property.
(d) Century Crowell shall be responsible for the payment
of any possessory interest ad valorem taxes that may be imposed
on the interest of Century Crowell under this License Agreement.
Ie) Century Crowell shall comply with all applicable air
quality and other laws and regulations, as such may now exist or
later be enacted or adopted, in the performance of the Work,
including, without limitation, all applicable regulations
regarding fugitive dust and weed abatement.
Section 5. rndemni ty. Century Crowell hereby agrees,
at its sole cost and expense, to indemnify, protect, hold
harmless and defend the Agency, with counsel selected and
approved by the Agency, 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, fees, disbursements and costs of attorneys,
environmental consultants and experts of any nature whatsoever
(collectively, "Losses") that may, at any time, be imposed upon,
incurred or suffered by, or asserted or awarded against, the
Agency directly or indirectly relating to the Work from:
(a) The failure of Century Crowell
their agents to perform the Work in
Environmental Laws and perform the work
accordance with the approved Grading Plans;
or Contractor or
accordance with
substantially in
(b) The failure of Century Crowell or Contractor or
their agents to complete, obtain, submit and/or file any
and all notices, permits, licenses and authorizations
required by Environmental Laws and the ordinances and
regulations of the City of San Bernardino in connection
with the Work;
(c) Any investigation, inquiry, order, hearing,
action or other proceeding by or before any governmental
agency in connection with the violation of any
environmental laws or the ordinances and regulations of the
City of San Bernardino by Century Crowell or Contractor or
their agents resulting from their failure to perform the
Work in accordance with such Environmental Laws and the
approved Grading Plans; and
882002:2242.4
Exh. "E" - 4
e
e
e
(d) Any claim for injury or death to persons or loss
or damage to property at or adjacent to the Grading Site
accruing or arising from the activities of Century Crowell
on the Grading Site during the period that Century Crowell
is performing Work at the Grading Site resulting from the
actions of Century Crowell while upon the Grading Site.
All obligations of Century Crowell under the indemnity given in
this section of this License Agreement are payable immediately
upon a determination by the appropriate authorities that such
obligations are due. Any amount due and payable hereunder to
the Agency by Century Crowell that is not paid within 30 days
after it is due, will bear interest from the date it is due at
the rate of 10% per annum. In no event shall Century Crowell be
obligated to indemnify the Agency for any Losses in the nature
of speculative, consequential or puni ti ve damages in connection
with or arising from this License Agreement or the transactions
contemplated herein or obligated to indemnify the Agency for any
Losses associated with or in the nature of "generator"
liability. The indemnity given by Century Crowell in this
section of this License Agreement will survive termination of
this License Agreement.
Notwi thstanding any other provision of this License Agreement,
Century Crowell does not assume any indemni ty obligations with
respect to Losses (i) associated with any unknown environmental
condi tions or Hazardous Substances that are discovered during
the Work, except in connection with the negligence of Century
Crowell or the Contractor or either of them in handling such
environmental conditions or Hazardous Substances or (iii) caused
by the negligence or willful misconduct of the Agency or its
agents or employees.
Secti.on 6.
License to Enter Grading Site.
(a) Subj ect to the terms and conditions of this License
Agreement, as of the Effective Date, the Agency hereby permits,
authorizes and licenses Century Crowell, Contractor and their
contractors and their agents and subcontractors to enter the
Grading Si te for the sole purpose of performing the Work in
accordance with the terms of this License Agreement. Obtaining
access to the Grading Site shall be the sole responsibility of
Century Crowell and Contractor.
(b) The Agency Executive Director shall have the right to
order the suspension of the Work by written notice to Century
Crowell (the "Notice of Suspension") in the event that the
882002:2242.4
Exh. "E" - 5
e
e
e
Agency Executive Director reasonably determines that Century
Crowell has failed to substantially comply with its material
obligations under this License Agreement. The Notice of
Suspension shall set forth (i) the specific reason for
suspension and (ii) permit Century Crowell not less than five
business days to cure. such failure prior to the effective date
of the suspension, (iii) indicate the number of days during
which the suspension is to be in effect and (iv) indicate
measures which Century Crowell shall implement in order to
correct or lift the suspension. Nothing in this subsection
shall be deemed to limit the right of the Agency to terminate
this License Agreement in accordance with its rights under
Section 17 below.
(c) CENTURY CROWELL ACCEPTS THE GRADING SITE IN ITS "AS
IS" CONDITION, WITH ALL FAULTS. CENTURY CROWELL ACKNOWLEDGES
THAT THE AGENCY MAKES AND HAS MADE NO WARRANTIES OR
REPRESENTATIONS REGARDING THE CONDITION OF THE GRADING SITE.
THE AGENCY SHALL HAVE NO RESPONSIBILITY FOR DAMAGE TO OR LOSS BY
THEFT OF PROPERTY OF CENTURY CROWELL ON THE GRADING SITE.
(d) Century Crowell shall perform the Work in an efficient
and workmanlike manner. Any and all items or materials brought
onto the Grading Site by Century Crowell pursuant to this
License Agreement, including without limitation, any and all
equipment and improvements, shall, as between Century Crowell
and the Agency, be and remain the personal property of Century
Crowell.
Section 7. Unpermitted Events. Century Crowell shall
not cause or permit any Hazardous Substance to be stored,
released or discharged on, in, under or about the Grading Site
in connection with the Work in any manner as to violate any
Environmental Laws, or in any manner as to require remediation
or removal thereof under any Environmental Laws, including,
without limitation, leaks and discharges from trucks, equipment
and operations on the Grading Site. Solely for purposes of this
section, the storage, use, release or discharge of waste which
violates the preceding sentence shall be referred to as an
"Unpermitted Event." If Century Crowell discovers an
Unpermitted Event, then Century Crowell shall immediately
remedy, repair and remediate any damage or harm caused by such
Unpermi t ted Even, and shall notify the Agency of such
Unpermitted Event as soon as possible, but in all cases within
seven calendar days of the discovery by Century Crowell of such
Unpermitted Event.
SB2002:2242.4
Exh. "E" - 6
e
e
e
Section 8. Restoration of Grading Site. Except as
provided in Section 9 (c) below, by the date of the termination
of this License Agreement pursuant to Section 9(a) or (b) below,
Century Crowell at its sole cost and expense shall have removed
all equipment, improvements and debris brought onto or added to
the Grading Site by Century Crowell or its contractors. In
addi tion, if grading work is commenced prior to termination of
this License Agreement, Century Crowell shall be obligated to
complete the work described in the Grading Plans at its sole
cost and expense. All such work shall be completed by Century
Crowell in a good and workmanlike manner with reasonable
diligence and in compliance with all applicable Environmental
Laws.
Section 9. Termination. This License Agreement shall
terminate upon the earliest to occur of the following:
(a) Written notice by Century Crowell to the Agency
terminating this License Agreement;
(b) Written notice by the Agency to Century Crowell
in accordance with its rights under Section 17 below (in
which event, the obligations under Section 8 above shall be
performed and completed within 30 days after the
termination date); and
(c) Upon Century Crowell acquisition of title to the
Grading Site.
Section 10. Survi val of Provisions. Notwithstanding the
expiration of the license granted by this License Agreement, the
parties' rights and obligations pursuant to Sections 4(f), 5, 7,
8, 9, 14, 15, 16, 22, and 25 of this License Agreement shall
survive, the termination of this License Agreement and remain in
full force and effect.
Section 11. Access to the Gradinq Site Durinq Term of
License. Subj ect to the Agency's compliance with all safety
requirements. Century Crowell, on reasonable advance written
notice from the Agency, shall allow the Agency access to the
Grading Site for inspection of the Work to assure substantial
compliance with the Grading Plan, and for reasonable testing for
the presence of Hazardous Substances and reasonable monitoring
of compliance by Century Crowell with Environmental Laws during
the performance of the Work. The. Agency shall conduct such
inspection, monitoring and testing in a manner that minimizes
interference with the Work.
882002:2242.4
Exha "En - 7
e
e
e
Section 12.
Insurance.
(a) Century Crowell or Contractor shall maintain or cause
their contractors to maintain appropriate insurance coverage for
all Work conducted pursuant to this License Agreement and will
cause the Agency to be named as an additional named insured
under all such policies. Prior to entering onto the Grading
Si te and commencement of any of the part of the Work, Century
Crowell or Contractor shall submit and/or cause to be submitted
to the Agency reasonably acceptable evidence of the following
insurance coverage on behalf of Century Crowell or Contractor or
their contractors: (i) all statutorily required workers
compensa tion coverage, (ii) comprehensive or commercial general
liability (bodily injury and property damage) coverage,
including the following supplementary coverages: (a) contractual
liability to cover liability assumed under this License
Agreement, (b) product and completed operations liability
insurance, (c) broad form property damage liability insurance of
not less than $1,000,000, combined single limit per occurrence
and naming the Agency as an additional insured, and (iii)
automobile bodily injury and property damage liability insurance
with limits of liability of such insurance not less than
$250,000 per person/$500,000 per occurrence for bodily injury
and $100,000 per occurrence for property damage, covering owned,
non-owned and hired vehicles used in the performance of the Work
and naming the Agency as an additional insured. Century Crowell
or Contractors' insurance, as the case may be, shall be primary
coverage and the Agency's insurance/self-insurance shall not be
contributory.
(b) The above insurance shall include a requirement that
the insurer provide the Agency with 30 days' written notice
prior to the effective date of any cancellation or material
change of the insurance. The worker's compensation insurance
specified above shall contain a waiver of subrogation against
the Agency and an assignment of statutory lien, if applicable.
The comprehensive general liability and automobile insurance
specified above shall name the Agency as an addi tional insured
wi th respect to operations performed under this License
Agreement. Any physical damage insurance carried by Century
Crowell contractors on construction equipment, tools, temporary
structures and supplies owned or used by said contractors shall
provide a waiver of subrogation against the Agency.
(c) The Developer shall deliver to the Agency surety bonds
issued by a California admitted surety company whose surety
instruments are rated in "Bests Insurance Guide", current
582002:2242.4
Exh. "E" - 8
e
e
e
edition, at a rating level acceptable to the City Department of
Development Services which names the City and the Agency as the
beneficiaries for the completion of the Work and the payment of
all materials, labor and worker's compensation insurance claims
in a principal sum of not less than 125% of the estimated cost
of the Work, as confirmed by the City Engineer.
Section 13. Notice to the Parties. For the purpose of
this License Agreement, communications and notices among the
parties shall be in writing and shall be deemed to have been
given when actually delivered, if given by hand delivery or
transmitted by overnight courier service, or if mailed, when
deposited in the United States Mail, First Class, postage
prepaid, return receipt requested and delivered to or addressed
as follows:
To the Agency:
To Century Crowell:
Redevelopment Agency of the City
of San Bernardino
201 North "EH Street, Suite 301
San Bernardino, California 92401
Attention: Executive Director
Phone: (909) 663-1044
FAX: (909) 888-9413
Century Crowell
Communities, L.P.
Century Vintage Homes
1535 South "DH Street,
Suite 200
San Bernardino, California
92408
Attention: John Pavelak
Phone: (909) 381-6007
FAX: (909) 381-0041
Section 14.
Reserved - No Text.
Section 15. All Costs Associated With Work Shall be Paid
By Century Crowell. As between Century Crowell and the Agency,
all costs incurred in connection with performance of any item of
the Work shall be the sole responsibility of and be paid by
Century Crowell, with no right of reimbursement from Agency
under the agreement referenced in the Recitals of this License
Agreement or under any other circumstances. I f any claim or
lien is recorded or asserted against the Grading Site, or any
interest therein, or the Agency for materials supplied or labor
or professional services performed directly or indirectly for
Century Crowell or Contractor relating to the Work, Century
Crowell shall satisfy and discharge such lien, at the sole cost
and expense of Century Crowell, within 30 calendar days of
notice to Century Crowell of the existence or assertion of such
claim or lien. I f Century Crowell disputes the claim or lien
and, therefore, elects not to satisfy and discharge the claim or
5B2002:2242.4
Exh. "E" - 9
e
e
e
lien, as required in the preceding sentence, then Century
Crowell shall, within 30 calendar days of notice to Century
Crowell of the existence or assertion of such claim or lien,
ei ther (i) file with the Agency a payment bond issued by a
California admitted surety that runs to the benefit of the
Agency in the amount of 125% of the aggregate amount of the
claim or lien stated by the party asserting such claim or lien,
conditioned for the payment of any sum that the claimant or lien
or may recover on the claim or lien, together with any costs of
suit incurred in enforcing such claim or lien or (ii) post with
the Agency cash collateral or other security reasonably
acceptable to the Agency for payment of such claim or lien.
Section 16. Conflicts/Disputes. If a conflict arises
between applicable regulations relating to the Work, the most
stringent regulatory requirement shall control. In the event
there is a disagreement in connection with the interpretation of
the requirements of any regulations, then the Agency and Century
Crowell will promptly endeavor in good faith to resolve such
disagreement. If no resolution can be reached within three days
of such disagreement, then the interpretation of the Agency
(exercised in good faith consistent with a reasonable
interpretation of industry standards) shall apply. Except for
the matters to be addressed as set forth above, if a dispute
arises between the parties to this License Agreement, the
parties hereto agree to use the following procedure to resolve
such dispute, prior to pursuing other legal remedies:
(a) A meeting shall be held promptly between the
parties that will be attended by individuals with decision-
making authority, who will attempt in good faith to
negotiate a resolution of the dispute.
Ib) If the parties are unsuccessful in resolving the
dispute under (a), above, they may:
l.
binding
parties
agree to submit the matter to mediation or
arbitration or a private adjudicator (if all
so agree); or
2. initiate litigation upon 45 days advanced
written notice to the other parties.
Ic) If any party should bring an action against the
other (s) to enforce the terms of this License Agreement,
the prevailing party shall be entitled to recover its
8B2002:2242.4
Exh. "E" - 10
e
e
e
reasonable attorneys' fees and costs, as determined by a
court of competent jurisdiction in said proceeding.
Section 17. Defaul t. I f a party fails to fulfill any
material obligation of this License Agreement, the other party
may give written notice to that party of such failure, and in
the event that party fails to remedy such failure within ten
calendar days of receipt of such notice, the notifying party may
terminate this License Agreement by a second written notice
and/or pursue whatever other legal or equitable remedies are
available.
Section 18. Governing Law. The parties hereto
acknowledge that this License Agreement has been negotiated and
entered into in California. The parties hereto expressly agree
that this License Agreement shall be governed by, interpreted
under, and construed and enforced in accordance with the laws of
the State of California and if controlling, by the laws of the
Uni ted States. Further, the parties to this License Agreement
hereby agree that any legal actions arising from this License
Agreement shall be filed in California Superior Court, in the
Court of San Bernardino, Central District or the appropriate
federal court in such district.
Section 19. Partial Invalidity. I f any term or
provision or portion of this License Agreement or the
application thereof to any person or circumstance shall, to any
extent, be invalid or unenforceable, the remainder of this
License Agreement, or the application of such term or provision
or portion thereof to persons or circumstances other than those
as to which it is held invalid or unenforceable, shall not be
affected thereby, and each such term and provision of this
License Agreement shall be valid and enforced to the fullest
extent permitted by law.
Section 20. No Intent to Create Third Party
Beneficiaries. The parties intend that the rights and
obligations under this License Agreement shall benefit and
burden only the parties hereto, and do not intend to create any
rights in, or right of action to or for the use or benefit of
any third party, including any governmental agency, who is not
one of the parties to this License Agreement.
Section 21. Wai vers. No waiver of any breach of any
covenant or provision herein contained shall be deemed a waiver
of any preceding or succeeding breach thereof, or of any other
covenant or provision herein contained. No extension of the
8B2002:2242.4
Exh. "E" - 11
e
e
e
time for performance of
herein shall be deemed
performance .of any other
this License Agreement.
any obligation or act to be performed
to be an extension of the time for
obligation or act to be performed under
Section 22. Professional Fees. If any action or suit by
a party hereto is brought against another party hereunder by
reason of any breach of any of the covenants, agreements or
provisions on the part of the other party arising out of this
License Agreement, the prevailing party shall be entitled to
have and recover of and from the other party all costs and
expenses of the action or suit, any appeals therefrom, and
enforcement of any judgment in connection therewith, including
reasonable attorneys' fees, accounting and engineering fees, and
any other professional fees resulting therefrom. For the
purposes of this Section 22, the words "reasonable attorneys'
fees" in the case of the Agency shall mean and include the
salaries and benefits of the lawyers employed in the Office of
the City Attorney, computed on an hourly basis, who may provide
legal services to the Agency in connection with the enforcement
of any provision of the Agreement.
Section 23. Entire Agreement. This License Agreement
(including all Exhibits attached hereto) is the final expression
of, and contains the entire agreement between, the parties with
respect to the subject matter hereof and supersedes all prior
understandings with respect thereto. This License Agreement may
not be modified, changed, supplemented or terminated, nor may
any obligations hereunder be waived, except by written
instrument signed by the party to be charged or by its agent
duly authorized in writing. The parties do not intend to confer
any benefit hereunder on any person, firm or corporation other
than the parties hereto.
Section 24. Construction. Headings at the beginning of
each paragraph and subparagraph are solely for the convenience
of the parties and are not a part of this License Agreement.
Whenever required by the context of this License Agreement, the
singular shall include the plural and the masculine shall
incl ude the feminine and vice versa. This License Agreement
shall not be construed as if it had been prepared by one of the
parties, but rather as if all parties had prepared the same.
Unless otherwise indicated, all references to sections are to
this License Agreement. All exhibits referred to in this
License Agreement are attached hereto and incorporated herein by
this reference. If the date on which any action is required to
be performed under the terms of this License Agreement is not a
382002:2242.4
Exh. "E" - 12
e
e
e
business day, the action shall be taken on the next succeeding
business day.
Section 25. No Admission. This License Agreement shall
not constitute, and no action taken pursuant to this License
Agreement shall constitute, any admission of fact, liability,
causation, responsibility or fault, or proportionate share
thereof, by any person with respect to the matters referred to
herein, including, without limitation, the presence of any
hazardous substances or other substances or chemicals in the
soil or groundwater anywhere in, on, under, at or about the
Grading Site. This License Agreement shall not be offered into
evidence or used by any party in any administrative, judicial or
alternative dispute resolution proceeding for any purpose,
except an action to enforce the terms of or for damages for
breach of this License Agreement.
Section 26. Counterparts. This License Agreement may be
executed in one or more counterparts, each of which shall be an
original, and all of which together shall constitute a single
instrument. This License Agreement may be executed by facsimile
signatures, and each facsimile counterpart, when taken together,
shall be deemed an original.
SBZOOZ,Z242.4
Exh. "E" - 13
e
e
e
IN WITNESS WHEREOF, Century Crowell
execute this License Agreement by the
authorized representatives, as follow:
and the Agency hereby
signatures of their
CENTURY CROWELL
Century Crowell Communities,
L.P., a California limited
partnership
By Century Homes Communities,
a California corporation, its
general partner
Date:
By:
John W. Pavelak
President
AGENCY
Redevelopment Agency of the City of San
Bernardino
Date:
By:
Gary Van Osdel
Executive Director
SB2002:2242.4
Exh. "E" - 14
e
e
e
EXHIBIT "AU
Vicinity Map of the Site
582002:2242.4
Exh. "E" - 15
J
e
e
e
I
l
a;
~
"
'"
"
-"
~
"
t,)
) L
191h Street
G
G
e
G
I
I
01
I
I
G
G
@
<0
G
o
G
t
..
<II
"
e
.
...
~
c
c
~
...
LincQln Street
@ @ 0
269/361
0 @ 0
@ @ 0
-----
G> . 0
------- j"
.
...
ell
G ~
--- ~~
I
17th SUeel
0....0 @
.,-~._.
.-.-.............
-~.J
e:
-...-..........
- I~:II
--~~:::.j
..... ,,'
I
I
e G, e (0.j
, . ~ I
...~..I".;........:........1...........:..............................::.\....', ," I
! 17\0' Street \ 9 :
!....................
. I
, r:::-. I
i ~ I
, I
;.........--..........,
0,.1
. '-::J I
i......................
c:;! ,
!: @ .
~ 1.....................;
.~! G !
c3 :.................1
! G) I
j......................
! I
i G I
i....................1
, I
j @> I
". ,
,...
-
e
[::~~-::.:::.....~:.......:
1 @ j @ I
i...........~..........,
i @ @!
!...-...............+.................n.i
,@ 0,
1.....................:.....................1
! e : G !
I::::::::~:.:.::I.:.:..~::::..::I
t... @ e,.:
Cummings Way
(-1'1
NORTH
.....es.c..
16th Street
(
1
RDA ASSESSOR.S EXISTING GENERAL PLAN AREA THOMAS GUIDE"
PROJECT NUMBER LAND USE LAND USE DESIGNATION PAGE . GRID
Within No:1hwcst 269-361-04 II1ru 20 & Vacant Land RS . Residential Suburban 5.861 Ac. tNL 576 C-4
ProjeCl 269-361-30 II1ru 36 (improved)
269-371-43I11ru 80 Vacant Land RS . Residential Suburban " 8.82 AC. MIL 576 C-4
(unimproved)
'Thgmas Guide San Bernardino Count)'. 1997 Edition
>:t.-
C.".I$......"...."O ~
ECONOMIC DEVELOPIJE.lir ACCNCY
EXHIBIT "A"
-tis
.
:;; 'T..
"7.,. I ". .,. ...... . ...... ~ _
e
e
e
SB2002:2242.4
EXHIBIT "A-l"
Legal Description of Model Home Lots
Exh. "E" - 16
e
e
e
EXHIBIT "B"
Grading Site
Metes and Bounds Description
5B2002,2242.4
Exh. "E" - 17
e
e
e
EXHIBIT "C"
The Work Plan
5B2002,2242.4
Exh. "E" - 18
e
e
e
EXHIBIT "F"
SCHEDULE OF PERFORMANCE
(Days shall be calendar days, and all dates herein are subject
to change due to force maj eure in accordance with Section 6.05
of the Amendment No.2)
[THIS SCHEDULE OF PERFORMANCE SHALL BE COMPLETED IN A MUTUALLY
ACCEPTABLE FORM BY THE PARTIES BY NO LATER THAN THE END OF THE
DEVELOPER'S DUE DILIGENCE INVESTIGATIONS]
Agency approval of Amendment No. 2 April
Close of Escrow
Submittal of plans for
approval
Submittal of construction
documents and landscaping
plans
Start of construction of
Site grading
Completion of Site grading
Submittal of construction
documents and landscaping
plans
Start of construction of
New Homes
Completion of initial phase
882002:2242.4
, 2002
Within 90 days following
Agency Approval of Amendment and
Opening of Escrow
As of March 1, 2002
weeks from Planning
approval
Either pursuant to Site Grading
License prior to Close of Escrow,
or promptly following Close of
Escrow
within 12 weeks from start of
work
As of March 1, 2002
promptly following issuance of
all permits and within weeks of
completion of Site grading, but in
all events by a date not later
than 16 weeks following Close of
Escrow
Within
weeks following Close
Exh. "F" - 1
e
e
e
of improvement of New Homes
Completion of 38~ New
Home
Distribution of Agency
Participation Fee, if any
5B2002:2242.4
of Escrow
Within weeks following Close
of Escrow
Within 4 weeks following the sale
of the 38th New Home to a New Home
Buyer
Exh. "F" - 2
e
e
e
EXHIBIT "G"
When Recorded, Mail to:
CERTIFICATE OF COMPLETION
We,
Secretary of the Redevelopment
Bernardino (the "Agency") hereby
Chairperson and
Agency of the City
certify as follows:
San
of
By its Resolution No. , adopted and approved
, 2002, the Agency has resolved as follows:
Section 1. The improvements required to be
constructed in accordance with that certain Disposition and
Development Agreement (the "Agreement") dated , by
and between the Agency and a California
(the "Developer") on Lot No. of Tract
(the "Lot") more fully described in Exhibit "A"
attached hereto and incorporated herein by this reference, have
been completed in accordance with the provisions of said
Agreement.
Section 2. This Certificate of Completion shall
constitute a conclusive determination of satisfaction of the
agreements and covenants contained in the Agreement with respect
to the obligations of the Developer, and its successors and
assigns, to construct and develop the improvements on the Lot,
excluding any normal and customary tenant improvements and minor
building "punch-list" items, and including any and all buildings
and any and all parking, landscaping and related improvements
necessary to support or which meet the requirements applicable
to the building and its use and occupancy on the Lot, whether or
not said improvements are on the Lot or on other property
subject to the Agreement, all as described in the Agreement, and
to otherwise comply with the Developer's obligations under the
Agreement with respect to the Lot and the dates for the
beginning and completion of construction of improvements thereon
582002,2242.4 Exh. "G" -1
e
e
e
under the Agreement; provided, however, that the Agency may
enforce any covenant surviving this Certificate of Completion in
accordance .wi th the terms and conditions of the Agreement and
the grant deed pursuant to which the property containing the Lot
was conveyed under the Amendment No.2, dated Said
Agreement is an official record of the Agency and a copy of said
Agreement may be inspected in the office of the Secretary of the
Redevelopment Agency of the City of San Bernardino located at
201 North "En Street , Suite 301, San Bernardino, California,
during regular business hours.
Section 3.
Completion pertains
attached hereto.
which this
described
Certificate
in Exhibit
of
"An
is
The Lot to
more fully
DATED AND ISSUED this
, 200 .
day of
Executive Director of the Redevelopment Agency
of the City of San Bernardino
SB2002:2242.4
Exh. "G" -2
e
e
e
5B2002,2242.4
EXHIBIT "H"
COMMUNITY REDEVELOPMENT HOUSING AFFORDABILITY
COVENANTS AND RESTRICTIONS
Exh. uRn - 1
e
COMMUNITY REDEVELOPMENT HOUSING
AFFORDABILITY COVENANTS AND RESTRICTIONS
(Arrow Vista Single Family Housing Improvement
Project: Phase II Lots)
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 CENTURY CROWELL, Communities, L.P., a
California limited partnership (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
e
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 project 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 restricted 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.
e
5B2002:8705.1
Exh. "H" - 2
e
NOW, THEREFORE, IN CONSIDERATION OF THE MUTUAL
COVENANTS AND UNDERTAKINGS SET FORTH HEREIN, AND FOR OTHER
GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND
SUFFICIENCY OF WHICH IS HEREBY ACKNOWLEDGED, THE QUALIFIED
HOMEBUYER, 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:
e
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
1.167(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.
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. In the event that either the
Qualified Homebuyer on the Delivery Date, or later
that a proposed Successor-In-Interest may be a "very
low income household" or a "lower income household",
as these terms are defined in Health and Safety Code
Section 50053.5 (b), then in such event the amount of
the maximum Affordable Housing Cost payable by any
such Successor-In-Interest household in connection
with the acquisition of the New Home at any time
during the Qualified Residence Period shall be
calculated as set forth in Health and Safety Code
50053.5(b) (1) or (2), as applicable.
e
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 Home Buyer if, during the Qualified
Residence Period, the Qualified Home Buyer sells,
5B2002:8705.1
Exh. "H" - 3
~
e
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 Home Buyer 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 Home Buyer to the Agency upon the
resale of the New Home, is more particularly described
in Section 5 of this Section 33334.3 Covenant. As of
the Delivery Date, the Agency has provided the
Developer with the sum of $60,175 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 33334.3f(B).
e
Agency MAP Loan. The words "Agency MAP Loan" mean and
refer to the proceeds of a certain mortgage loan which
the Agency has provided to the Qualified Home Buyer on
the Delivery Date in the amount of $
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 Home Buyer;
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.
e
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
SB2002:8705.1
Exh. "H" - 4
e
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 between the
Qualified Homebuyer and the Successor-In-Interest)
shall be accomplished upon the close of the New Home
Escrow.
e
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.
e
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
5B2002:8705.1
Exh. "H" - 5
______1
e
Housing Cost for the New Horne pursuant to the terms of
the purchase transaction
all sums payable by the
purchase money. mortgage
and other fees and costs.
for the New Horne, including
Qualified Homebuyer for its
financing, insurance, escrow
Qualified Residence Period. The words "Qualified
Residence period" mean the period of time beginning on
the Delivery Date and ending on the date which is
forty-five (45) years after the Delivery Date.
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 Horne.
e
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. 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 Horne which does not
exceed the maximum Adjusted Family Income level for a
Moderate-Income Household. Upon acquisition of the
New Horne 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. Acknowledqments and Representations of the
Qualified Homebuver. The Qualified Homebuyer hereby
acknowledges and represents that, as of the Delivery Date:
e
(a) the total household income for the Qualified
Homebuyer does not exceed the maximum amount permitted as
5B2002:8705.1
Exh. "H" - 6
e
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 Delivery 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) the sum payable each month by the Qualified
Homebuyer following the close of the New Home Escrow as
principal and interest, property taxes and, property
casualty insurance for the acquisition of the New Home does
not exceed the Affordable Housing Cost for the household;
e
(e) the
Agency wi th
inspection by
the Agency:
(i)
(ii)
Qualified Homebuyer agrees to provide the
the following items of information for
the Agency promptly upon written request of
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;
current wage, income and salary statements
for all person residing in the New Home at
the close of the New Home Escrow;
(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 33334.4 Covenant and
that this Section 33334.3 Covenant imposes certain
restrictions on the resale of the New Home during the
e
5B2002:8705.1
Exh. "H" - 7
e
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 Qualified
Residence Period which is , 204 .
Dated:
Initials of
Qualified Homebuyer
Section 3. Covenant of the Qualified Homebuyer to
Maintain Affordability of the New Home During the Qualified
Residence Period and Covenant Relating to Sale or Transfer
of the New Home During the Qualified Residence Period to a
Successor-In-Interest.
e
(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 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 Home 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 Home to a Successor-In-Interest shall
be subject to the recordation of the "Notice of Agency
Concurrence" as provided in Section 3(d).
e
(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 Home (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
5B2002:8705.1
Exh. "H" - 8
e
Home 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 Home 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 Home) ;
(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 Home is given to the Agency;
e
(iii) resale price of the New Home payable by the
Successor-In-Interest, including the terms
of all purchase money mortgage financing to
be assumed, provided or obtained by the
Successor-In-Interest, escrow costs and
charges, realtor broker fees and all other
resale costs or charges payable by ei ther
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 reference for
the Successor-In-Interest with a written
authorization signed by the Successor-In-
Interest authorizing the Agency to contact
each such reference; and
(vi) such other relevant
Agency may reasonably
in Section 3{c).
information
request, as
as the
provided
e
(c) Within twenty (20) days following receipt of the
notice of intention described in Section 3 (b), the Agency
shall provide the Qualified Homebuyer with either a
preliminary confirmation of approval or a preliminary
rejection of approval in writing of the income and
552002:8705.1
Exh. "H" - 9
e
household occupancy qualifications of the Successor-In-
Interest. The Agency shall not unreasonably withhold
approval of any proposed sale of the New Home to a
Successor-In-Interest who satisfies the Adjusted Family
Income and the Affordable Housing Cost requirements for
occupancy of the New Home and for whom the other
information as described in Section 3(b) has been provided
to the Agency. In the event that the Agency may request
additional information relating to the confirmation of the
matters described in Section 3(b), 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 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:
e
(i) the recordation of the Notice of Agency
Concurrence executed by the Successor-In-
Interest and the Agency 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 as established by the Qualified
Homebuyer and Successor-In-Interest shall
have been satisfied.
e
(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
5B2002:8705.1
Exh. "H" - 10
e
subj ect 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 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 Qualified Homebuyer, for itself, its
assigns, hereby covenants and agrees that:
the New Home.
successors and
e
(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 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
structural elements, and
areas of the dwelling
presentable manner;
maintain the windows,
painted exterior surface
unit in a clean and
e
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;
SB2002:8705.1
Exh. "H" - 11
e
failure to regularly mow lawn areas or permit
grasses planted in lawn areas to exceed nine
inches (9") in height, or failure to otherwise
maintain the landscaping in a reasonable
condition free of wed 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.
e
In the event the Qualified Homebuyer fails to cure or
commence to cure the Maintenance Deficiency within the time
allowed, 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 to comply with the provision of this
Section 4(a). If, upon the conclusion of a public hearing,
the Agency makes a finding that a Maintenance Deficiency
exists and that there appears to be non-compliance with the
general maintenance standard, as described above,
thereafter the Agency shall have the right to enter the New
Home (exterior areas only) and perform all acts necessary
to cure the Maintenance Deficiency, or to take other action
at law or equity the Agency may then have to accomplish the
abatement of the Maintenance Deficiency. Any sum expended
by the Agency for the abatement of a Maintenance Deficiency
as authorized by this Section 4(a) shall become a lien on
the New Home. 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) .
e
(b) Graffiti which is visible from any public right-
of-way which is adjacent or contiguous to the New Home
SB2002:870S.1
Exh. "H" - 12
e
shall be removed by the Qualified Homebuyer from any
exterior surface of a structure or improvement on the New
Home 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 Home (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 Home 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 Home as authorized by this Section
4(b) shall become a lien on the New Home. 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).
e
(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 Home
in the manner provided under civil Code Sections 2924,
2924b and 2924c in the amount as reasonably necessary to
restore the New Home to the maintenance standard required
under Section 4 (a) or Section 4 (b), including 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 Home, the prevailing path shall
be entitled to recover its attorneys' fees and costs of
suit. 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
al terations, 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.
e
5B2002:8705.1
Exh. uHn - 13
e
Section 5. Protection of Agency Investment of Moneys
Derived From the Low-and Moderate-Income Housinq Fund in
the New Home - Agency Investment Reimbursement.
(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 Home mortgage provided to the
Qualified Home Buyer by the conventional mortgage lender,
plus the original outstanding balance of the Agency Map
Loan, if any.
e
"Qualified Home Buyer Equity" means the downpayment amount
in cash paid by the Qualified Home Buyer for the New Horne
on the Delivery Date (e.g.: the equity or "basis" as
defined under the Code, net of the Purchase Money
Mortgage (s) of the Qualified Home Buyer in the New Home),
plus the reduction, if any, of the outstanding principal
balance of the Purchase Money Mortgage loan (s) secured by
the New Home through the date of the resale of the New
Home.
"Resale 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 costs payable or otherwise
allocated to the Successor-In-Interest in connection with
the transfer of the New Home from the Qualified Home Buyer
to the Successor-In-Interest.
"Resale Profit" means the balance of the
calculation:
following
(Resale Price)-(Purchase
Home Buyer Equity +
Factor)=Resale Profit.
Money Mortgage)-(Qualified
Resale Cost Adjustment
A portion of the Resale
Agency by the Qualified
Section 5 (b) .
Profit shall
Home Buyer
be payable to
in accordance
the
with
e
"Resale Cost Adjustment Factor" means one of the following
sums determined by reference to the number of years which
have elapsed between the Delivery Date and the date on
8B2002:8705.1
Exh. "H" - 14
e
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 loth
anniversary after Delivery
Date
From and including the loth
anniversary to the 30th
anniversary after Delivery
Date
e
From and including the 30th
anniversary to the end of
the Qualified Residence
Period
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 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 Home Buyer 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 Home Buyer 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 Home Buyer (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 Home Buyer
shall be payable to the Agency as the "Agency Investment
Reimbursement" in the amounts as follows:
e
8B2002:8705.1
Exh. "H" - 15
e
Date of Resale of New Home
After Delivery Date
From the Delivery Date to
the 2nd anniversary after
the Delivery Date
From the 2nd anniversary to
the loth anniversary after
the Delivery Date
From the loth anniversary to
end the 20th anniversary
after the Delivery Date
From the 20th anniversary to
the 30th anniversary after
the Delivery Date
e
From the 30th anniversary
after the Delivery Date to
the end of the Qualified
Residence Period
Portion
Payable
Resale of
of Resale
to Agency
New Home
Profit
from
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
25% of the Resale Profit is
payable to the Agency as
Agency Investment
Reimbursement
10% of the Resale Profit is
payable to the Agency as
Agency Investment
Reimbursement
(c) Two (2) 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 is
presented as follows:
EXAMPLE A: Resale to a purchaser
Income exceeds the income level
Household:
whose
of a
Adjusted
Moderate
Family
Income
Assume that on the Delivery Date the sales price of
the New Home payable by the Qualified Home Buyer was
$135,000 and that the resale occurs on the 7th
anniversary following the Delivery Date;
e
SB2002:8705.1
Exh. "H" - 16
e
Assume the Resale Price of the New Home is $165,000;
and
Assume that Qualified Home Buyer Equity as of the date
of the resale is $14,000:
EXAMPLE A CALCULATION OF RESALE PROFIT: $165,000'-$125,0002-
($14,0003+$2,000')=$24,0005:Resale Profit (SEE ALSO
FOOTNOTES, BELOW).
Agency Investment Reimbursement amount under Example A
payable at close of the resale escrow in this hypothetical
example is $24,500.
EXAMPLE B: Resale to a purchaser whose Adjusted Family
Income does not exceed the income level of a Moderate
Income Household:
e
Assume same facts as in
Successor-In-Interest also
Affordable Housing Cost for
price of $165,000 on the 7~
the Delivery Date;
Example A and that the
pays no more than an
the New Home at a resale
anniversary date following
EXHIBIT B CALCULATION OF RESALE PROFIT:
No Agency Reimbursement payable to Agency as Successor-In-
Interest pays to the Qualified Home Buyer no more than
Affordable Housing Cost for its purchase of the New Home.
(d)
Buyer to
shall be
The sole source of funds of the Qualified Home
pay the Agency the Agency Reimbursement Agreement,
from the Resale Profit amount realized at the time
1 The Resale Price of the New Horne to the Successor-In-Interest.
, The Purchase Money Mortgage amount ($118,000
mortgage plus $7,000 Agency MAP) of the New Horne as of
Date.
conventional
the Delivery
3 The Qualified Horne Buyer Equity in the New Horne ($10,000 cash
down payment plus $4,000 reduction of outstanding principal balance on
the Purchase Money Mortgage loans);
. The Resale Cost Adjustment Factor in the 7th year; and
e
5 The Resale Profit of $24,000 is subject to a 85% allocation to
pay the Agency Investment Reimbursement, or $24,500 payable to the
Agency (as provided in Section 5(b)).
SB2002:8705.1
Exh. "Hn - 17
e
of resale to a purchaser whose Adjusted Family Income
exceeds the income level of a Moderate Income Household.
In the event that the Agency Investment Reimbursement
amount is paid to the Agency at the time of resale of the
New Horne to a person or household which does not qualify as
a Successor- In- Interest to the Qualified Horne Buyer from
the source of funds described in the preceding sentence,
the Agency shall cause to be recorded concurrently with the
resale of the New Horne to such person, a notice of release
of the following provisions of this Section 33334.3
Covenant:
Section 2,
Section 3,
Section 5
Section 7
Section 6. Acknowledgment
provisions of Section 3, Section
Section 33334.3 Covenant to the
of the First Mortgage Lender.
of Subordination of the
5 and Section 7(b) of this
Mortgage Security Interest
e
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 Deli very 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.
e
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
5B2002:8705.1
Exh. "H" - 18
e
First Mortgage Lender in the New Home. In the event that
the First Mortgage Lender (or its assignee) may foreclose
the lien of the First Mortgage Lender in the New Home
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 Mortqaqe
Loan and Aqency Riqht of First Refusal.
(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.
e
(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 offer the New Home
for resale to a Success-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, and 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 strictly in accordance with the offer. 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, reser-
vations 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
552002:8705.1
Exh. "H" - 19
e
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 Horne 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.
e
Section 9. Burden and Benefit. The Developer, the
Agency and the Qualified Homebuyer hereby declare their
understanding and intent that the burden of the covenants
set forth herein touch and concern the land in that the
Qualified Homebuyer I 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 Project were used and
applied by the Agency in. order to make the New Horne
available for acquisition and occupancy by the Qualified
Homebuyer.
e
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 Horne), 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 Horne.
582002:8705.1
Exh. "Hu - 20
e
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 (30)
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 default nor shall it change the
time of breach or event of 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.
e
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:
e
(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
SB2002:870S.1
Exh. "H" - 21
e
unlawful or in violation of the rights of
the Agency; or
(ii)
by other action at law or in equity as
necessary or convenient to enforce the
obligations, covenants and agreements of
the Qualified Homebuyer to the Agency.
(b) No third party shall have any right or power to
enforce any provision of this Section 33334.3 Covenant on
behalf of the Agency or to compel the Agency to enforce any
provision of this Section 33334.3 Covenant against the
Qualified Homebuyer on the New Home.
Section 12. Governing Law.
Covenant shall be governed by the
California.
This
laws
Section 33334.3
of the State of
e
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 have not any right or power to approve
any such amendment to this Section 33334.3 Covenant, and
the execution by the Developer of any such amendment after
the delivery date shall not be required.
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 arising out of this Section
33334.3 Covenant, the prevailing party in such action shall
be entitled to recover from the other party reasonable
attorneys' fees to be fixed by the court in which a
judgment is entered, as well as the costs of such suit.
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.
e
SB2002:8705.1
Exh. "H" - 22
e Section 16. Time is of the Essence. For each
provision of this Section 33334.3 Covenant which states a
specific amount of time within which the requirements
thereof are to be satisfied, time shall 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" Streei, Ste 301
San Bernardino, CA 92401
Phone: (909) 384-5081
If to the
Qualified Homebuyer:
e
Attn:
Phone:
Notice shall be deemed given five (5) calendar days after
the date of mailing to the party, or, if personally
delivered, when received by the Executive Director of the
Agency or the Qualified Homebuyer, as applicable.
e
SB2002:870S.1
Exh. "H" - 23
e
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
Century Crowell Communities,
L.P., a California limited
Partnership
e
By Century Homes Communities,
a California corporation,
its general partner
Dated:
By:
AGENCY
Redevelopment Agency of the
City of San Bernardino
Dated:
By:
Executive Director
[ALL SIGNATURES MUST BE NOTARIZED]
Approved as to Form:
By:
Agency Special Counsel
e
6B2002:8705.1
Exh. "H" - 24
e
e
e
SB2002:8705.1
EXHIBIT "A"
Legal Description of the New Home
Exh. "H" - 25
"
.
** FOR OFFICE USE ONLY - NOT A PUBLIC DOCUMENT **
RESOLUTION AGENDA ITEM TRACKING FORM
Meeting Date (Date Adopted): -4 - \ - 0 ;:)- Item #
Vote: Ayes (-') Nays -e--
Change to motion to amend original documents: '-
12.30 Resolution #
Abstain .G--
('rx.!dCXbi-/b
I
Absent --Q,y
Reso, # On Attachments: ~ Contract term: -
Note on Resolution of Attachment stored separately:::="-
Direct City Clerk to (circle I): PUBLISH, POST, RECORD W/COUNTY By:
NulUVoid After: -
fT
Date Sent to Mayor: 4 - 3- 0:>
Date of Mayor's Signature: 4 _L~ -0:;
Date of ClerklCDC Signature: '1 ~L{ -0 J-.
Reso. Log Updated: /
Seal Impressed: -
Date MemolLetter Sent for Signature: L'O '" 0811\1/'\111(" ~1E0 See Attached:
60 Day Reminder Letter Sent on 30th day: See Attached:
90 Day Reminder Letter Sent on 45th day: See Attached:
Date Retumed: -4-I;l-Od
Request for Council Action & Staff Report Attached: Yes L
Updated Prior Resolutions (Other Than Below): Yes
Updated CITY Personnel Folders (6413, 6429, 6433, 10584, 10585, 12634): Yes
Updated CDC Personnel Folders (5557): Yes
Updated Traffic Folders (3985,8234,655,92-389): Yes
No By
No / By
No / By
No ,/ By
No 7 By
Copies Distributed to:
City Attorney Code Compliance
Dev. Services
EDA
,/
Finance
MIS
Parks & Rec.
Police,
Public Services
Water
Others:
Notes:
BEFORE FILING, REVIEW FORM TO ENSURE ANY NOTATIONS MADE HERE ARE TRANSFERRED TO THE
YEARLY RESOLUTION CHRONOLOGICAL LOG FOR FUTURE REFERENCE (Contract Term, etc.)
Ready to File: ~
Date: 4-1 $"o:r
Revised 01/12/01