HomeMy WebLinkAboutT-5210 - Agreement/Covenant - 12/28/2005 i
RECORDED AT THE REQUEST OF __ IIIIIII��II�III�IIIII
AND WHEN RECORDED RETURN TO: I�IIIIIIII�IIIIII`�IIIII'lll 1 1 l J
City of Fresno FRESNO County Recorder
Planning and Development Department Robert C. Werner
Housing & Community Development Divisi( DOC 2004-0131827
2600 Fresno Street, Room 3076 Tuesday, JUN 105, 2004 14 0001508310
Fresno, CA 93721-3605 Ttl Pd $ djg/R6/1-64
Attention: Manager of Housing
and Community Development Division
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(SPACE ABOVE THIS LINE FOR RECORDER'S USE)
This Agreement is recorded at the request and for the benefit of the City of Fresno and is
exempt from the payment of a recording fee pursuant to Government Code Section 6103.
CITY OF FRES O
0* By,
Andrew T. Souza
Assistant2-i
Manager
Dated: �
Home Investment Partnerships Program
Community Housing Development Organization
Agreement
(Affecting real property and including Covenants Running with the Land)
by and between
CITY OF FRESNO,
a municipal corporation
and
SELF HELP ENTERPRISES, INC.
a California non-profit public benefit corporation
regarding
"WILLOW/JENSEN PROJECT"
(APN 481-110-26)
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Table of Contents
RECITALS 7
ARTICLE 1. DEFINITIONS 9
1.1 ADA 9
1.2 Affirmative Marketing 9
1.3 Affordability Period 9
1.4 Affordable Housing 9
1.5 Budget 9
1.6 Certificate of Completion 9
1.7 CFR 9
1.8 Commencement of Construction 9
1.9 Declaration of Restrictions 9
1.10 Eligible Costs 10
1.11 Event of Default 10
1.12 Family 10
1.13 Funding Source 10
1.14 Grant 10
1.15 Grant Documents 10
1.16 Hazardous Materials 10
1.17 HOME CHDO Funds 10
1.18 Household 11
1.19 HUD 10
1.20 Loan 11
1.21 Low-Income Families 10
1.22 Plans and Specifications 11
1.23 Project 11
1.24 Project Completion Date 11
1.25 Property 11
1.26 SHE 11
1.27 Unit 11
ARTICLE 2. TERMS 11
2.1 Grant and Loan of HOME CHDO Funds 12
2.2 HOME Documents 12
2.3 Term of Agreement 12
2.4 Repayment and Maturity 12
2.5 Incorporation of Documents 12
2.6 Covenants of SHE 12
ARTICLE 3. GENERAL REPRESENTATIONS
AND WARRANTIES OF SHE 12
3.1 Existence and Qualification 12
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3.2 No Litigation Material to Financial Condition 13
3.3 No Conflict of Interest 13
3.4 No Legal Bar 13
3.5 No Violation of Law 13
3.6 No Litigation Material to Project 14
3.7 Assurance of Governmental Approvals and Licenses 14
ARTICLE 4. HOME PROGRAM REPRESENTATIONS
AND WARRANTIES BY SHE 14
4.1 Accessibility 14
4.2 Affirmative Marketing 14
4.3 Availability of HOME CHDO Funds 14
4.4 'Compliance with Agreements 14
4.5 Conflict of Interest 15
4.6 Construction Standards 15
4.7 Covenants to Run with the Land 15
4.8 Displacement of Persons 16
4.9 Income Certification and Reporting 16
4.10 Lead-Based Paint 16
4.11 Limitation on Operating Funds 16
4.12 Minority Outreach Activities 16
4.13 Other Laws and Regulations; Hazardous
Substances and Indemnification 1:7
4.14 Project Requirements 17
4.15 Religious Organizations 17
4.16 Reporting Requirements 17
4.17 ,Request for HOME CHDO Funds 18
4.18 Affordability Period 18
4.19 Terminated Projects 18
ARTICLE 5. COVENANTS AND AGREEMENTS OF SHE 18 ,
5.1 Adequate Repair and Maintenance 18
5.2 Affordable Housing 18
5.3 Compliance With Environmental Laws 19
5.4 Compliance With Laws 20
5.5 Discharge of Liens and Stop Notices 20
5.6 Financial Statements 20
5.7 Indemnification 21
5.8 Inspection and Audit 21
5.9 Inspection of Eligible Property 21
5.10 Insurance and Bonds 21
5.11 Maintenance of Existence, Qualification, and Authority 21
5.12 No Other Liens 21
5.13 Nondiscrimination 21
5.14 Ownership 21
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5.15 Payment of Liabilities 22
5.16 Report of Events of Default 22
5.17 Use of Funds 22
ARTICLE 6. DISBURSEMENT OF HOME CHDO FUNDS 22
6.1 Amount of Disbursement 22
6.2 Conditions Precedent to Disbursement 22
6.3 SHE's Certification 23
6.4 Disbursement of HOME CHDO Funds 24
6.5 Documentation 24
6.6 Existence, Qualification, and Authority 24
6.7 Marketing Plan 24
6.8 Permits and Approvals 25
6.9 Property Insurance 25
ARTICLE 7. PREDEVELOPMENT OF PROJECT 25
7.1 Contracts and Subcontracts 25
7.2 . Financing 26
7.3 Insurance and Bonds 26
7.4 Permits and Licenses 26
7.5 Plans and Specifications 26
ARTICLE 8. DEVELOPMENT OF PROJECT 26
8.1 ADA/Barriers to the Disabled 26
8.2 Audits 26
8.3 Books, Records and Documents 27
8.4 Certificate of Completion 27
8.5 - Commencement of Construction 27
8.6 Completion of Construction 28
8.7 Configuration of the Project 28
8.8 Damage to Property 28
8.9 Equal Employment Opportunity 28
8.10 Inspections 28
8.11 Fees, Taxes and Other Levies 28
8.12 Mechanic's Liens and Stop Notices 29
8.13 Project Responsibilities 29
8.14 Quality of Work 29
8.15 Relocation 29
8.16 Reporting Requirements 30
8.17 Scheduling and Extension of Time/
Unavoidable Delay in Performance 30
8.18 Transfer 31
ARTICLE 9. PROJECT OPERATIONS 31
9.1 Operation of Project 31
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9.2 Occupancy Requirements 31
9.3 Fair Marketing Plan 31
9.4 Maintenance and Security 31
9.5 Nondiscrimination 31
9.6 .Project Home Sale Price and
Disposition of Project Proceeds/Income 32
9.7 Affordable Housing 33
ARTICLE 10. INDEMNITY, INSURANCE AND BONDS 34.
10.1 Insurance Coverage 34
A' , COMMERCIAL GENERAL LIABILITY 34
B. COMMERCIAL AUTOMOBILE LIABILITY 34
C. WORKERS' COMPENSATION 34
D. BUILDERS RISK INSURANCE 34
E. PROFESSIONAL LIABILITY INSURANCE 34
10.2 Indemnity 35
10.3 Professional Services 36
A. Indemnification 36
B. Insurance 37
10,4 'Property Insurance 38.
10.5 Bonds 38
ARTICLE 11. DEFAULT AND REMEDIES 39
11.1 Events of Default 39
11.2 Notice of Default and Opportunity to Cure 40
11.3 Remedies Upon an Event of Default 41
ARTICLE 12. GENERAL PROVISIONS 41
12.1 Amendments 41
12.2 Archaeological Finds 41
12.3 Attorney's Fees 41
12.4 Binding on All Successors and Assigns 41
12.5 Counterparts 42
12.6 Disclaimer of Relationship 42
12.7 Effective Date 42
12.8 Entire Agreement 42
12.9 Exhibits 42
12.10 Expenses Incurred Upon Event of Default 42
12.11 Governing Law and Venue 42
12.12 Headings . 42
12.13 Interpretation 42
12.14 No Assignment or Succession 42
12.15 No Third-Party Beneficiary 43
12.16 No Waiver, 43
12.17 Nonreliance 43
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12.17 Nonreliance 43
12.18 Notice 43
12.19 Precedence of Documents 44
12.20 Recording of Documents 44
12.21 Remedies Cumulative 44
12.22 Severability 44
Schedule of Exhibits
Exhibit "A" - Description of Real Property and Site Plan
Exhibit "B" - Proforma Budget `
Exhibit "C" - Exemplar Certificate of Completion
Exhibit "D" - Declaration of Restrictions
Exhibit "E" - Schedule of Performance
Exhibit "F" - Payments and Payment Schedule
Exhibit "G" - Promissory Note
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HOME INVESTMENT PARTNERSHIPS PROGRAM
COMMUNITY HOUSING DEVELOPMENT ORGANIZATION
AGREEMENT
(AFFECTING REAL PROPERTY AND INCLUDING COVENANTS RUNNING WITH
THE LAND)
This HomeInvestmentPartnerships Program Community Housing Development
Organization Agreement("Agreement") is entered into effective June 15, 2004, by and
between the CITY OF FRESNO, a municipal corporation, acting through its Planning
and Development Department, Housing and Community Development Division (the
"City"), and SELF HELP ENTERPRISES, INC., a California nonprofit public benefit
corporation, ("SHE").
RECITALS
A. City has received a HOME Investment Partnerships Program ("HOME Program")
grant from the U.S. Department of Housing and Urban Development ("HUD"), under
Title II of the Cranston-Gonzalez National Affordable Housing Act of 1990, as amended
("ACT").
B. The HOME Program requires no less than fifteen percent(15%) of the City's HOME
Program annual allocation be used by Community Housing Development Organizations
(CHDO)for the development of Affordable Housing within the City of Fresno as
required in 24CFR92.300.
C. SHE has been certified by City as a CHDO in accordance with HUD's certification
criteria.
D. SHE holds all rights, title and interest in fee to the certain undeveloped real property
located within the territorial jurisdiction of the City, APN 481-110-26, more fully
described in Exhibit"A," attached hereto and incorporated herein, (the "Property").
E. SHE proposes to legally partition and sever a portion of the Property into
approximately forty-one (41) contiguous parcels.
F. SHE, as developer and CHDO, agrees to construct upon the Property (i) a total of
thirty (30) "Starter Homes", in three (3) phases of ten (10) homes each, each Home to
be a decent, safe, sanitary, and otherwise standard single family owner occupied
residences to be sold to low-income persons and maintained as Affordable Housing for
the Affordability Term specified in this Agreement(the Homes) and (ii) eleven (11)
market rate single family homes. By separate agreement SHE will dedicate or
otherwise convey to the City at no cost and upon terms/conditions agreeable to the City
that portion of the Property described/depicted in Exhibit "A" which the City shall
improve and maintain as a neighborhood park to the extent of allocated and available
funding in each City fiscal year hereunder.
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G. The use of HOME Program monies will help achieve financial feasibility for the
Project and maximize the affordability of the Homes.
H. To further it's goal to increase the supply of Affordable Housing within the City of
Fresno, City is assisting SHE by providing a grant and loan of HOME CHDO Funds
through periodic disbursements ("Disbursements")that will reimburse SHE for HOME
eligible related costs of the Project which will allow SHE to provide Low Income
Families in the community with Affordable Housing, for the intended uses and purposes
of the Project.
I. City is conducting an environmental review of the Project pursuant to the National
Environmental Protection Act ("NEPA") and HOME regulations, and shall have
determined, prior to disbursement of the HOME Funds hereunder, that the Project will
have or cause no adverse or reportable conditions or effects pursuant to NEPA and
HOME regulations.
J. As a condition to disbursement of the HOME CHDO Funds, SHE shall execute,
among other things, a Trust Deed Note, and a Declaration of Restrictions, which shall
be recorded against the Homes upon the Property. These instruments are intended to
secure City's continuing interest in the affordability and habitability of the Homes, as
well as secure the performance of other covenants contained in that document and this
Agreement.
K. The City has determined that this Agreement is in the best interests of, and will
materially contribute to, the Housing Element of the General Plan. Further, the City has
found that the Project: (i) will have a positive influence in the neighborhood and
surrounding environs, (ii) is in the vital and best interests of the City, and the health,
safety, and welfare of City residents, (iii)complies with applicable federal, state, and
local laws and requirements, (iv)will increase, improve, and preserve the community's
supply of low income housing available at affordable housing cost to persons and
families of low income, as defined hereunder; (v) and all planning and administrative
expenses incurred in pursuit hereof are necessary for the production, improvement, or
preservation of low income housing; (vi)will comply with any and all owner participation
rules and criteria applicable thereto.
L. The City has determined that the HOME Funded Project constitutes available and
allocated programmatic funding for privately owned, owner occupied single family
homes, outside the reach of California Constitution Article XXXIV and enabling
legislation.
M. SHE's Board of Directors approved this Project and Agreement on April 27, 2004.
NOW, THEREFORE, IN CONSIDERATION of the above recitals, which recitals are
contractual in nature, the mutual promises herein contained, and for other good+and
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valuable consideration hereby acknowledged, the parties agree as follows:
ARTICLE 1. DEFINITIONS
The following terms have the meanings and content set forth in this article wherever
used in this Agreement, attached exhibits or attachments that are incorporated into this
Agreement by reference.
1.1 ADA means the Americans with Disabilities Act of 1990.
1.2 Affirmative Marketing shall mean a good faith effort to attract eligible persons
from all racial, ethnic and gender groups in the housing market area to purchase the
eligible Homes (as hereinafter defined)that are to be constructed as the Project, co-
extensive with the City's Fair Marketing Plan.
1.3 Affordability Period means the period of fifteen (15) years as applicable per 24
CFR 92.254 commencing from the date the City issues and records the Certificate(s)of
Completion.
1.4 Affordable Housinq means the Units constructed with HOME Funds meets the
requirements as required by 24 CFR 92.254.
1.5 Budget means that proforma budget for construction, financing and other related
costs the Project attached.as Exhibit "B".
1.6 Certificate of Completion means that certificate issued in the form attached as
Exhibit "C" or as a comparable Certificate of Occupancy, on an entire Project, Project
Phase or per Project Home basis, to SHE by City evidencing completion of Project
construction on the Property pursuant to the terms of this Agreement.
1.7 CFR means the Code of Federal Regulations.
1.8 Commencement of Construction means the time SHE or SHE's construction
contractor begins substantial physical Project work on the Property, including, without
limitation, delivery of materials and any work beyond maintenance of the Property in its
status quo condition.
1.9 Declaration of Restrictions means the declaration of restrictions, substantially in
the form of Exhibit "D", containing all conditions, covenants, and restrictions required by
law and regulations, the Consolidated Plan and the General Plan, as applicable,
running with the Project Homes upon the Property and burdening such for the term
stated in said Declaration of Restrictions.
1.10 Eligible Costs means those Project costs in the Budget, and any amendments
thereto that do not exceed the total HOME CHDO Funding provided in this Agreement
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and are approved in writing by the City's Manager of the Housing and Community
Development Division, incurred by SHE before the City issues the Certificate of
Completion, and related to acquisition, pre-development, construction and other related
hard and soft costs for which HOME CHDO Funds may be used as specified in 24 CFR
92.205 and 92.206 and not disallowed by 24 CFR 92.214, provided, however, that costs
incurred in connection with any activity that is determined to be ineligible under the
Program by HUD or City shall not constitute Eligible Costs. Eligible Costs shall not
include any cost paid by or from any Funding Source directly or indirectly to SHE either
before or after Disbursement of HOME CHDO Funds pursuant to this Agreement.
1.11 Event of Default has the same meaning assigned to such term under
Section 11.1 hereunder.
1.12 Family has the same meaning given that term in 24 CFR 5.403.
1.13 Funding Source means any permanent financing sources for the Project except
HOME Funds.
1.14 Grant means the up to $600,000 grant (not to exceed $20,000/Home) made by
City to SHE with the HOME CHDO Funds.
1.15 Grant Documents are collectively this Agreement along with all exhibits and
attachments to these documents.
1.16 Hazardous Materials means any hazardous or toxic substances, materials,
wastes, pollutants or contaminants which are defined, regulated or listed as "hazardous
substances," "hazardous wastes," "hazardous materials," "pollutants," "contaminants"
or"toxic substances" under federal or state environmental and health safety laws and
regulations, including without limitation, petroleum and petroleum byproducts,
flammable explosives, urea formaldehyde insulation, radioactive materials, asbestos
and lead. Hazardous Materials do not include substances that are use or consumed in
the normal course of developing, operating or occupying a housing project, to the extent
and degree that such substances are stored, used and disposed of in the manner and
in amounts that are consistent with normal practice and legal standards.
1.17 HOME CHDO Funds or"Home Funds" are the HOME Program monies with the
maximum amount not to exceed the sum of One Million Two Hundred Thousand
($1,200,000.00) disbursed in the manner provided as a grant in a sum not to exceed
Six Hundred Thousand Dollars($600,000.00)--Twenty Thousand Dollars ($20,000) per
Unit, and as a loan in a sum not to exceed Six Hundred Thousand Dollars ($600,000) --
Twenty Thousand Dollars ($20,000) per Unit, by City to SHE, as a CHDO, pursuant to
this Agreement to be used to fund the Project.
1.18 Household means one or more persons occupying a Unit.
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1.19 HUD means the United States Department of Housing and Urban Development.
1.20 Loan means the up to $600,000 loan (not to exceed $20,000/Home) made by
City to SHE with the HOME CHDO Funds, secured by Deed of Trust substantially in the
form attached hereto as Exhibit G, assignable to/assumable by Home buyers only upon
written consent of the City.
1.21 Low-Income Families means families whose annual income does not exceed
eighty percent (80%) of the median income for the Fresno, California area as
determined by HUD, except as HUD may establish income ceilings higher or lower than
eighty percent(80%)of the median for the area on the basis of HUD findings that such
variations are necessary.
1.22 Plans and Specifications means the final plans and specifications as approved
by City for the construction of the Houses.
1.23 Project means the construction, in three (3) phases in groups of ten, of(30)
single family homes, approximately 1200-1350,square feet, three and four bedrooms,
two bathrooms, upon the Property owned by SHE and more specifically described in
this Agreement and the Exhibits thereto including all HOME Eligible activities such as
acquisition, pre-development, construction of and financing assistance as to
Improvements for sale to Low-Income Families and preservation of the Homes as
housing for Low-Income Families with the assistance of HOME CHDO Funds while
meeting,the Affordable Housing, income targeting and other requirements of 24 CFR
92.254 for the fifteen (15) year Affordability Period. HOME CHDO Funds will assist in
financing the completion of the Project Homes and the related Improvements for sale to
Home buyers as Affordable Housing. {
1.24 Project Completion Date•means the date that City shall have determined that
the Project has reached completion in accordance with the plans and specifications and
aapproved by City and is in compliance with all Housing Standards. The Project
Completion Date for this project is June 15, 2006.
1.25 PrODerty means that property currently known as APN 481-110-26, Fresno,
California, described in the attached Exhibit"A."
1.26 SHE means Self Help Enterprises , a California nonprofit public benefit
corporation, acting through its authorized corporate agent(s).
1.27 Unit or"Home" means a Project home.
• ARTICLE 2. TERMS
2.1 Grant and Loan of HOME CHDO Funds. The City agrees to provide total HOME
CHDO Funds to this project in an amount that shall not exceed One Million Two
Hundred Thousand Dollars($1,200,000.00). Of this amount, the City agrees to provide
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both a Grant of HOME'CHDO Funds to SHE in an amount not to exceed Six Hundred
Thousand Dollars ($600,000.00) --Twenty Thousand Dollars ($20,000) per Home; and
a Loan of HOME CHDO Funds to SHE in an amount not to exceed Six Hundred
Thousand Dollars ($600,000.00) --Twenty Thousand Dollars ($20,000) per Home;
under the terms and conditions of this Agreement and all exhibits, attachments and
documents incorporated into this Agreement. The HOME CHDO Funds shall only be
used by SHE to pay for Eligible Costs under the HOME Program.
2.2 HOME Documents. SHE shall execute, among other things, this Agreement, the
Trust Deed Note securing the Loan of HOME Funds(Exhibit G) and the Declaration of
Restrictions which shall be recorded against the Homes.
2.3 Term of Agreement. This Agreement is effective as of the date first above set
forth and shall remain in force through'the expiration of the Affordability Period, unless
terminated as otherwise provided herein. The parties may mutually agree to extend the
term hereof in writing added as an amendment hereto.
2.4 Grant Repayment and'.Maturity. SHE shall not be obligated to repay the Grant if
SHE fully complies with the terms of this Agreement for the term hereof. If an Event of
Default occurs and SHE fails'to cure the default as detailed in Article 11 or if this
Agreement is terminated for any reason other than expiration, SHE shall be
immediately subject to the repayment/recapture provisions contained in the Act, HUD
regulations and this Agreement.
2.5, Incorporation of Documents. The Act and HUD regulations at 24 CFR Part 92,
and all exhibits, attachments, documents and instruments referenced herein, as now in
effect and as may be amended from time to time, constitute part of this Agreement and
are incorporated herein by•reference. All such documents have been provided to the
parties herewith or have been otherwise provided to and/or secured by the parties and
reviewed by each of them prior to execution hereof.
2.6 Covenants of SHE. SHE covenants and agrees to comply with all terms and
conditions of this Agreement and SHE covenants and agrees that the Project will
comply with all requirements of 24 CFR Part 92 and this Agreement.
ARTICLE 3. GENERAL REPRESENTATIONS AND WARRANTIES OF SHE
3.1 Existence and Qualification. SHE represents and warrants as of the date hereof
that SHE is a duly organized California nonprofit corporation in good standing and a
qualified charitable organization exempt from certain taxes under IRC 501 (c) (3) and
Cal. R&T 23701 (d). SHE is neither controlled by, nor under the direction of, individuals
or entities seeking to derive profit or gain'from the organization. SHE has among its
corporate purposes the provision of decent housing that is affordable to Low-Income
r and Very-Low Income persons. SHE maintains accountability to Low-Income
community residents by maintaining at least one-third of its governing board's
membership for residents of Low-Income neighborhoods/representatives thereof and by
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providing a formal process for Low-Income program beneficiaries to advise SHE in its
affordable housing decision making. SHE has a demonstrated capacity for carrying out
the Project. SHE has a history of serving the community within which the Project is
located. SHE has the requisite power, right, and legal authority to execute, deliver, and
perform its obligations under this Agreement and has taken all action necessary to
authorize the execution, delivery, performance, and observance of its obligations under
this Agreement. This Agreement, when executed and delivered, shall constitute the
legal, valid, and binding obligation of SHE enforceable against SHE in accordance with
its respective terms, except as such enforceability may be limited by (a) bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium, or other similar laws of
general applicability affecting the enforcement of creditors' rights generally and (b)the
application of general principles of equity without the joinder of any other party.
3.2 No Litigation Material to Financial Condition. SHE represents and warrants as of
the date hereof that except as disclosed to and approved by City in writing, no litigation
or administrative proceeding before any court or governmental body or agency is now
pending, nor, to the best of SHE's knowledge, is any such litigation or proceeding now
threatened, or anticipated against SHE that, if adversely determined, would have a
material adverse effect on the financial condition, business, or assets of SHE or on the
operation of the Project.
3.3 No Conflict of Interest. SHE represents and warrants as of the date hereof that
no official, officer, agent, or employee of City directly or indirectly owns or controls any
interest in SHE, and no person, directly or indirectly owning or controlling any interest in
SHE, is an official, officer, agent, or employee of City.
3.4 No Legal Bar. SHE represents and warrants as of the date hereof that the
execution, delivery, performance, or observance by SHE of this Agreement will not, to
the best of SHE's knowledge, materially violate or contravene any provisions of: (a) any
existing law or regulation, or any order of decree of any court, governmental authority,
bureau, or agency; (b) governing documents and instruments of SHE; or(c) any
mortgage, indenture, security agreement, contract, undertaking, or other agreement or
instrument to which SHE is a party or that is binding on any of its properties or assets,
the result of which would materially or substantially impair SHE's ability to perform and
discharge its obligations or its ability to complete the Project under this Agreement.
3.5 No Violation of Law. SHE represents and warrants as of the date hereof that to
the best of SHE's knowledge, this Agreement and the operation of the Project as
contemplated by SHE do not violate any existing federal, state, or local laws or
regulations.
3.6 No Litigation Material to Project. SHE represents and warrants as of the date
hereof that except as disclosed to and approved by City in writing, there is no action,
proceeding, or investigation now pending, or any basis therefor known or believed to
exist by SHE that questions the validity of this Agreement or of any action to be taken
k under this Agreement that would, if adversely determined, materially or substantially
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impair SHE's ability to perform and observe its obligations under this Agreement or that
would either directly or indirectly have an adverse effect on or impair the completion of
the Project.
3.7 Assurance of Governmental Approvals and Licenses. SHE represents and
warrants as of the date hereof that SHE has obtained and, to the best of SHE's
knowledge, is in compliance with all federal, state, and local governmental reviews,
consents, authorizations, approvals, and licenses presently required by law to be
obtained by SHE for the Project as of the date hereof.
ARTICLE 4. HOME PROGRAM REPRESENTATIONS AND WARRANTIES BY SHE
SHE represents and warrants that:
4.1 Accessibility. SHE warrants, covenants and agrees that, to the extent
applicable, it shall comply with 24 CFR Part 8, which implements Section 504 of the
Rehabilitation Act of 1973 (29 U.S.C. 794), including, without limitation, construction of
the Homes so that it meets the applicable accessibility requirements.
4.2 Affirmative Marketing. SHE warrants, covenants and agrees that it shall comply
with all affirmative marketing requirements including without limitation those set out at
24 CFR 92.350 and 24 CFR 92.351, in order to provide information and otherwise
attract eligible persons from all racial, ethnic and gender groups in the housing market.
SHE shall be responsible for complying with the City's Fair Marketing Plan as amended
from time_to time. SHE shall maintain records of actions taken to affirmatively market
Units and to assess the results of these actions.
4.3 Availability of HOME CHDO Funds. SHE understands and agrees that the
availability of HOME Funds is subject to the control of HUD or other federal agencies
and should said funds be encumbered, withdrawn or otherwise made unavailable to the
City, whether earned by or promised to SHE, SHE shall not be provided said funds
unless and until they are made available for payment to the City by HUD and City
receives said funds. No other funds owned or controlled by the City shall be obligated
under this Agreement.
4.4 Compliance with Agreement. SHE warrants, covenants and agrees that, in
accordance with the requirements of 24 CFR 92.254 and 24 CFR Part 85, if SHE
materially fails to comply with any term of this Agreement, City may suspend or
terminate this Agreement and all other agreements with SHE in accordance with and
subject to Article 11.
4.5 Conflict of Interest. SHE warrants, covenants and agrees that it shall comply
with the Conflict of Interest requirements of 24 CFR 92.356 including, without limitation,
that no officer, employee, agent or consultant of SHE may occupy a Unit. SHE
understands and acknowledges that no employee, agent, consultant, officer or elected
official or appointed official of the City who exercises or has exercised any functions or
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responsibilities with respect to the Project or who is in a position to participate in a
decision making process or gain inside information with regard,to these activities, may
obtain a financial interest or benefit from the Project, or have an interest in any contract,
subcontract or agreement with respect thereto, or the proceeds thereunder, either for
him or herself or for anyone that person has family or business ties, during his or her
tenure or for one year thereafter.
4.6 Construction Standards. SHE shall construct any housing assisted under this
Agreement in compliance with all applicable local codes, ordinances and zoning
requirements in effect at the time of issuance of Certification of Completion. In the
absence of a local code for construction, SHE agrees to comply with the applicable
standards identified in 24 CFR 92.251.
4.7 Covenants to Run with the Land. City and SHE expressly warrant, covenant and
agree that the covenants and restrictions set forth in this Agreement shall run with the
land by deed restriction, and shall bind all successors in title to the Homes, provided,
however, that on expiration of this Agreement and the Affordable Housing requirements
therein said covenants and restrictions shall expire. City and SHE further warrant,
covenant and agree that the covenants and restrictions set forth herein shall run in
favor of the City.
The City and SHE hereby declare their understanding and intent that the
covenants and restrictions set forth herein directly benefit the land (a) by enhancing and
increasing the enjoyment and ownership of the Homes by certain Low-Income Families, -
and (b) by making possible the obtaining of advantageous financing for construction.
SHE, for itself and its successor(s)on title, covenants and agrees that
from the recording of the Certificate(s) of Completion until the expiration of the
Affordability Period the Homes shall be used for Affordable Housing.
Without waiver or limitation, City shall be entitled to injunctive or other
equitable relief against any violation or attempted violation of any covenants and
restrictions, and shall, in addition, be entitled to damages for any injuries or losses
resulting from any violations thereof.
All present and future owners of the thirty(30) affordable Homes and
other persons claiming by, through, or under them shall be subject to and shall comply
with the covenants and restrictions in the Agreement and that certain Declaration of
Restrictions attached hereto/incorporated herein as Exhibit "D". The acceptance of a
deed of conveyance to the Homes shall constitute an agreement that the covenants
and restrictions, as may be amended or supplemented from time to time, are accepted
and ratified by such future owner, tenant or occupant, and all such covenants and
restrictions shall be covenants running with the land and shall bind any person having
` at any time any interest or estate in the Homes, all as though such covenants and
restrictions were recited and stipulated at length in each and every deed, conveyance,
mortgage or lease thereof.
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The failure or delay at any time of City or any other person entitled to
enforce any such covenants or restrictions shall in no event be deemed a waiver of the
same, or of the right to enforce the same at any time or from time to time thereafter, or
an estoppel against the enforcement thereof.
4.8 Displacement of Persons. SHE warrants, covenants and agrees that pursuant to
24 CFR 92.353, it will take all reasonable steps to minimize the displacement of any
persons (families, individuals, businesses, nonprofit organizations and farms).
4.9 Income Certification and Reporting. During the term hereof, SHE warrants,
covenants and agrees that it shall comply with the procedures for annual income
determinations at 24 CFR 92.203. SHE shall make a good faith effort to verify that the
annual income provided by an applicant or occupying Household in an income
certification is accurate by taking one or more of the following steps as part of the
verification process: (1)obtain a pay stub for the most recent pay period; (2) obtain an
income tax return for the most recent tax year; (3) conduct a credit agency or similar
search; (4) obtain an income verification form from the applicant's current employer; (5)
obtain an income verification form from the Social Security Administration and
California Department of Social Services if the applicant receives assistance from either
of such agencies; or(6) if the applicant is unemployed and has no such tax return,
obtain another form of independent verification. In addition to the foregoing annual
income verification requirement, SHE shall re-verify the annual income determination to
any extent required by HOME Regulations.
4.10 Lead-Based Paint. SHE warrants, covenants and agrees that it shall comply
with the requirements of the Lead-Based Paint Poisoning Prevention Act of 42 U.S.C.
4821 et seq., 24 CFR Part 35 and 24 CFR 982.4010), except for 24 CFR
982.4010)(1)(i). These requirements apply to all Homes and any common areas in the
Project. SHE shall incorporate or cause incorporation of this provision in all contracts
and subcontracts for work performed on the Homes which involve the application of
paint. SHE shall be responsible for all inspection, testing and abatement activities.
4.11 Limitation on Operating Funds. SHE acknowledges and agrees that it shall not
use any portion of the HOME Funds hereunder in reimbursement of operating
expenses.
4.12 Minority Outreach Activities. SHE warrants, covenants and agrees that it shall
comply with all federal laws and regulations described in Subpart H of 24 CFR Part 92,
including, without limitation, any requirement that SHE comply with the City's minority
outreach program.
4.13 Other Laws and Regulations; Hazardous Substances and Indemnification. SHE
warrants, covenants and agrees that, in addition to complying with the federal laws and
regulations already cited in this Agreement SHE has reviewed and shall comply with all
other federal laws and regulations that apply to the HOME Program, including, without
limitation, requirements of 24 CFR 58.6 and the Flood Disaster Protection Act of 1973,
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as amended (42 U.S.C. 4001-4128).
SHE shall cause the Project to be in compliance with, and not cause or
permit the Project to be in violation of, any existing or future environmental law, rule,
regulation, ordinance, or statute. SHE shall not transport to or from the Homes or use,
generate, manufacture; produce, store, release, discharge, or dispose of on, under, or
about the Homes or surrounding real estate any hazardous or toxic chemicals,
materials, substance, or wastes or allow any person or entity to do so except in such
amounts and under such terms and conditions permitted by applicable laws, rules,
regulations, ordinances, and statutes.
SHE shall indemnify, defend, and hold City harmless from any and all
liability arising out of or relating to any investigation, site monitoring, containment,
cleanup, removal, restoration, or other remedial work of any kind or nature relating to
any hazardous or toxic chemicals, materials, substance, or wastes in or on the Homes
regardless of cause or origin.
The Project is not located in a tract identified by the Federal Emergency
Management Agency as having special flood requirements.
4.14 Project Requirements. SHE warrants, covenants and agrees to comply with the
Project requirements Subpart F of 24 CFR Part 92, as applicable and in accordance
with the type of Project assisted, including, but not limited to, the limit on per-unit
subsidy amount at 24 CFR 92.250; property standards at 24 CFR 92.251; the
requirements for sale of Homes at 24.CFR 92.254.
4.15 Religious Organizations. SHE warrants, covenants and agrees.that it is a
secular entity and not a primarily religious organization and that it shall not engage in
any prohibited activities described in 24 CFR 92.257. Subject to the foregoing, SHE
does not intend to utilize HOME Funds to construct housing owned primarily by
religious organizations or to assist'primarily religious organizations in acquiring housing.
4.16 Reporting Requirements. SHE warrants, covenants and agrees that it shall
submit performance reports to the City as detailed in Section 8.16. Furthermore, SHE
agrees to,provide, at the sole cost of SHE, annual audited Financial Statement(s)for
the expenses and ongoing financial transactions which occur as a result of this
Agreement as detailed in.Section 8.2. SHE agrees to account for the expenditure of
HOME CHDO Funds using generally accepted financial accounting principles, which
financial'documentation shall be made available to City and HUD upon request.
4.17 Request for HOME CHDO Funds. SHE warrants, covenants and agrees that it
shall request HOME Funds limited to the amount needed, and only as needed, for
reimbursement for Eligible Costs. In the event HOME CHDO Funds are requested to
reimburse Eligible Costs which subsequently lose eligibility as Eligible Costs, SHE shall
immediately return such HOME CHDO Funds to City.
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1.18 Affordability Period. During the term of this Agreement, and subject to the
Reclaration of Restrictions, SHE warrants, covenants and agrees that the Homes will
meet the Affordable Housing, income targeting and other requirements of 24 CFR
92.254 as applicable during the Affordability Period. The Homes shall, at a minimum
and to any extent applicable, be sold to and occupied by Low-income Families for the
Affordability Period except upon foreclosure by a lender or transfer in lieu of foreclosure
following default under a deed of trust. However, if at any time following transfer by
foreclosure or transfer in lieu of foreclosure, but still during the Affordability Period, the
owner of record prior to the foreclosure or transfer in lieu of foreclosure, or any newly
formed entity that includes such owner of record or those whom such owner of record
has or had family or business ties, obtains an ownership interest in the Project or
Property, the.Affordability Period shall be revived according to its original terms. In the
event SHE fails to comply with this Section or the Affordability Period is not revived
following transfer by foreclosure or transfer in lieu of foreclosure, the HOME Funds shall
become immediately due and payable as,provided for in this Agreement.
4.19 Terminated Projects. SHE understands and agrees that, if the Project is
terminated before completion, either voluntarily or otherwise, such constitutes an
ineligible activity and the HOME Funds shall become immediately due and payable as
provided for in this Agreement to the City's HOME Investment Trust Fund in
accordance with 24 CFR 92.503 (b) (except for any project-specific assistance to SHE
as provided in 24 CFR sections 92.301(a)(3) and 92.301 (b)(3)).
ARTICLE 5. COVENANTS AND AGREEMENTS OF SHE
SHE covenants and agrees to the following for the entire term of the Agreement:
5.1 Adequate Repair and Maintenance. SHE shall maintain the eligible Project
Property in compliance with all applicable codes, laws, and ordinances, prior to sale
thereof to low income home buyers.
5.2 Affordable Housing. SHE, for itself and its successor(s) on title covenants and
agrees that the Project shall constitute Affordable Housing (as provided at 24 CFR
92.254) during the entire Affordability Period. This covenant as to Affordable Housing
shall remain in effect and run with the land during the entirety of the Affordability Period.
In the event of any failure to comply with the time period in which the Project must
constitute Affordable Housing, City shall without waiver or limitation be entitled to
injunctive relief, as damages are not an adequate remedy at law for such breach.
5.3 Compliance With Environmental Laws. SHE shall cause the Project to be in
compliance with, and not to cause or permit the Project to be in violation of, any existing
or future environmental law, rule, regulation, ordinance, or statute. Although City will '
utilize its employees and agents for regular inspection and testing of the eligible
r Property, SHE agrees that, if City has reasonable grounds to suspect any such
violation, SHE shall be entitled to thirty(30)days' notice and,opportunity to cure such
violation. If the suspected violation is not cured, City shall have the right to retain an
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independent consultant to inspect and test the eligible Property for such violation. If a
violation is discovered, SHE shall pay for the cost of the independent consultant.
Additionally, SHE agrees:
A. That City shall not be directly or indirectly involved with the inspection,
testing, removal or abatement of asbestos or other hazardous or toxic chemicals,
materials, substances, or wastes and that all cost, expense and liability for such work
shall be and remain solely with SHE;
B. Not to use, generate, manufacture, produce, store, release, discharge, or
dispose of on, under, or about the Eligible Property or surrounding real estate or
transport to or from the eligible Property or surrounding real estate any hazardous or
toxic chemicals, materials, substance, or wastes or allow any person or entity to do so
except in such amounts and under such terms and conditions permitted by applicable
laws, rules, regulations, ordinances, and statutes;
C. To give prompt written notice to City of the following:
L Any proceeding or inquiry by any governmental authority with
respect to the presence of any hazardous or toxic chemicals, materials, substance, or
waste in or on the eligible Property or the surrounding real estate or the migration
thereof from or to other property;
ii. All claims made or threatened by any third party against SHE or
such properties relating to any loss or injury resulting from any hazardous or toxic
chemicals, materials, substance, or waste; and
iii. SHE's discovery of any occurrence or condition on any real
property adjoining or in the vicinity of such properties that would cause such properties
or underlying or surrounding real estate or part thereof to be subject to any restrictions
on the ownership, occupancy, transferability, or use of the property under any
environmental law, rule, regulation, ordinance or statute.
D. To indemnify, defend, and hold City harmless from any and all claims,
actions, causes of action, demands,judgments, damages, injuries, administrative
orders, consent agreements, orders, liabilities, penalties, costs, expenses (including
attorney's fees and expenses), and disputes of any kind whatsoever arising out of or
relating to SHE's or any other party's use or release of any hazardous or toxic
chemicals, materials, substance, or wastes on the eligible Property regardless of cause
or origin; and
E. To indemnify, defend, and hold City harmless from any and all liability
arising out of or relating to any investigation, site monitoring, containment, cleanup,
removal, restoration, or other remedial work of any kind or nature relating to any
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hazardous or toxic chemicals, materials, substance, or waste in or on the eligible
Property regardless of cause or origin.
5.4 Compliance With Laws. SHE shall promptly and faithfully comply with, conform
to and obey all present and future federal, state and local statutes, regulations, rules,
ordinances, plan, guidelines, and other legal requirements applicable by reason of this
Agreement or otherwise to the Project. SHE acknowledges that the use of HOME
CHDO Funds subjects the.Project to extensive federal regulation and covenants and
agrees that it shall comply with, conform to and obey (and take such steps as are
necessary to enable City to comply with, conform to and obey) all federal statutes,
regulations, rules and policies applicable to the Program and the Project. SHE
acknowledges that in its pursuit hereof, SHE, not the City, is responsible for
determining applicability of and compliance with all local, state, and federal laws
including, but not limited to, any applicable provisions of the California Labor Code,
Public Contract Code, and Government Code. The City makes no express or implied
representation as to the applicability or inapplicability of any such laws to this
Agreement or to the parties' respective rights or obligations hereunder including, but not
limited to, payment of federal, state and local prevailing wages, competitive bidding,
subcontractor listing, or similar or different matters. SHE further acknowledges that the
City shall not be liable or responsible at law or in equity for any failure by SHE to comply
with any such laws, regardless of whether the City knew or should have known of the
need for such compliance, or whether the City failed to notify SHE of the need for such
compliance.
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5.5 Discharge of Liens and Stop Notices. SHE shall discharge, bond, or insure over
or otherwise release or collateralize to City's reasonable satisfaction any mechanic's,
laborer's, materialman's, warehouseman's, or other lien or stop notice filed against the
Eligible Property or Project funding within twenty(20) days after the date the lien or stop
notice is filed.
5.6 Financial Statements. SHE shall provide to City annual financial statement(s)
that are current, signed, and prepared according to generally accepted accounting
principles consistently applied (except as otherwise disclosed therein) within one
hundred and twenty (120) days following the end of its respective fiscal years, or any
shorter period of time otherwise set forth herein.
5.7 Indemnification. In addition to the specific covenants of indemnification in Article
10, SHE shall and hereby agrees to indemnify, defend, and hold City, and its agents,
officials, and employees, harmless from and against any and all suits, damages, claims,
causes of actions, demands,judgments, penalties, costs, expenses, attorney's fees,
and any and all injuries to persons or property and all other matters arising out of or
incurred in connection with the performance by SHE of the terms, conditions, and
covenants of this Agreement or otherwise in connection with the Project.
5.8 Inspection and Audit. Any duly authorized representative of City, the State, or
HUD shall, at all reasonable times, have access to and the right to inspect, copy, audit,
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and examine all books of account, records, and other documents of SHE relating to the
Project for a period of four(4) years after expiration or termination of this Agreement.
SHE will cooperate fully with City, the State, and HUD in connection with any interim or
final audit relating to the Programs and the Project that may be performed.
5.9 Inspection of Eligible Property. Any duly authorized representative of City, the
State, or HUD shall, at all reasonable times, have access and the right to inspect the
eligible Property until completion of the Project and initial sale of the Homes to low
income home buyers.
5.10 Insurance and Bonds. SHE shall maintain insurance and bonds with the
coverages and in the amounts provided in Article 10.
5.11 Maintenance of Existence, Qualification, and Authority. SHE shall maintain the
existence, qualifications, and authority necessary to continue its business and shall
comply with all laws and regulations applicable to it, its property, and its operations, the
noncompliance with which could materially affect its business, its financial condition, or
the Project.
5.12 No Other Liens. SHE shall not create or incur, or suffer to be created or
incurred, or to exist, any additional mortgage, pledge, encumbrance, lien, charge, or
other security interest of any kind on the eligible PRoject Property, without the prior
written consent of City.
5.13 Nondiscrimination. SHE shall comply with and cause any and all contractors and
subcontractors to comply with any and all federal, state, and local laws with regard to
illegal discrimination and SHE shall not illegally discriminate against any persons on
account of race, religion, sex, family status, age, handicap, or place of national origin in
its performance of this Agreement and the completion of the Project.
5.14 Ownership. Except as required in pursuit hereof, SHE shall not sell, lease, or
otherwise dispose of all or any material part of the eligible Project Property without the
prior written consent of City, which consent shall not be unreasonably withheld or
delayed.
5.15 Payment of Liabilities. SHE shall pay and discharge in the ordinary course of its
business all material obligations and liabilities, the nonpayment of which could have a
material or adverse impact on its financial condition, business, or assets or on the
operation of the Project, except such obligations and liabilities that have been disclosed
to City in writing and are being contested in good faith.
5.16 Report of Events of Default. SHE shall promptly give written notice to City_ upon
becoming aware of any Event of Default under this Agreement.
5.17 Use of Funds. SHE covenants and agrees that it shall use the HOME CHDO
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Funds only for reimbursement of Eligible Costs. If any such Funds shall be determined
to have been used by SHE for something other than an Eligible Cost, the Grant and /or
Loan shall become immediately due and payable as provided for in this Agreement.
ARTICLE 6. DISBURSEMENT OF HOME CHDO FUNDS
Without waiver of limitation, the parties agree as follows regarding disbursement of
HOME CHDO Funds:
6.1 Amount of Disbursement. HOME CHDO Funds shall be disbursed to reimburse
Eligible Costs aggregating in an amount not to exceed One Million Two Hundred
Thousand Dollars ($1,200,000.00). City's obligations shall in no event exceed the
HOME CHDO Funds amount specified in this Agreement. Any Project costs exceeding
One Million Two Hundred Thousand Dollars ($1,200,000.00), whether or not the costs
qualify as Eligible Costs, shall be the sole responsibility of SHE. There are two sources
of funding as follows: an amount not to exceed Six Hundred Thousand Dollar
($600,000.00) in the form of the Grant and an amount not to exceed Six Hundred
Thousand Dollar($600,000.00) in the form of the Loan.
6.2 Conditions Precedent to Disbursement. City shalt not be obligated to make or
authorize any disbursements of HOME CHDO Funds or take any other action under this
Agreement unless the following_conditions are satisfied:
A. There exists no Event of Default as provided in Article 11, nor any act,
failure, omission or condition that with the passage of time or the giving of notice or
both would constitute an Event of Default;
B. SHE has acquired insurance coverage and delivered to City evidence of
insurance as required in Article 10;
C. SHE has submitted evidence that the HOME Funds are sufficient to
complete the Project. If City determines that said funds are not sufficient to complete
the Project, SHE may satisfy this condition by depositing the amount of the deficiency
with City;
D. SHE is current with its compliance of all reporting requirements set forth
in this Agreement;
E. SHE has delivered a Project schedule satisfactory to City;
F. City's receipt of, and continued right to disburse, HOME CHDO Funds;
and
G. SHE has provided City with a request for HOME CHDO Funds to .
reimburse SHE for its expenditure of monies in payment of Eligible Costs, and detailing
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such Eligible Costs applicable to the request, consistent with Exhibit "F" captioned
Payments and Payment Schedule; and
H. The environmental effects of the Project have been assessed in
accordance with the provisions of NEPA and HOME CHDO Funds have been approved
for release pursuant to 24 CFR Part 58.
I. SHE must obtain City's approval of the Design Development Drawings
and SHE must obtain all land use approvals and permits required by this Agreement.
J. SHE shall provide to the City, or cause the City to be provided with (a)
construction contract(s)for the Project, (b) 100 percent (100%) payment and
performance bonds provided by SHE pursuant to Article 10 and by any other
contractor(s) and/or subcontractor(s) acceptable to City and naming City as payee, and
copies of receipts showing that the SHE has paid for and pulled all necessary
construction permits. These bonds will only be required if SHE uses HOME CHDO
funds to pay for construction activities related to the project.
6.3 SHE's Certification. SHE shall submit to City a written certification signed by
SHE that, as of the date of each Disbursement:
A. The representations and warranties of SHE contained in or incorporated
by reference in this Agreement continue to be true, complete and accurate.
B. SHE has carried out all of its obligations and is in compliance with all the
obligations or covenants specified in this Agreement, to the extent that such obligations
or covenants are required to have been carried out or are applicable at the time of the
request for the Disbursement.
C. SHE has not committed or suffered an act, event, occurrence, or
circumstance that constitutes an Event of Default or that with the passage of time or
giving of notice or both would constitute an Event of Default.
D. The Disbursement's previously made, if any, have been used solely to
reimburse Eligible Costs actually.incurred or paid by SHE in accordance with this
Agreement. SHE's certification shall include: a schedule showing reimbursed costs
made by SHE with HOME CHDO Funds, itemized as may be reasonably requested by
City; and a statement by SHE of the balance of disbursed HOME Funds, if any, held by
SHE.
E. The Disbursements requested will be used solely to reimburse Eligible
Costs actually incurred or paid by SHE in accordance with this Agreement. SHE's
certification shall include a statement that the itemized obligations have been properly
incurred, are properly chargeable in connection with the Project, and have not been the
basis of any previous disbursement.
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6.4 Disbursement of HOME CHD.O Funds. City will disburse HOME CHDO Funds
for reimbursement of Eligible Costs of the Project when SHE delivers on a no more
frequently than monthly basis, a request for payment with a description of the work
performed, material supplied and/or costs incurred for which disbursement is being
requested. SHE shall substantiate each request for payment to the reasonable
satisfaction of the City including invoice's from vendors, suppliers, contractors,
subcontractors, lenders, or escrow agents subcontractors for each requested item
consistent with Exhibit "F" captioned Payments and Payment Schedule. SHE payment
requests shall reflect a deduction for prior Project disbursements by City and Eligible
Project Costs incurred by City if any.
6.5 Documentation. SHE shall submit to City such other substantiation
documentation, including but not limited to paid invoices for work completed and in
place and for materials purchased and suitably stored, cancelled checks and
unconditional lien releases signed by each material suppliers, contractor, subcontractor :
and laborer as City may reasonably request.
6.6 Existence, Qualification, and Authority. SHE shall provide to City any evidence
requested by City and reasonably required to demonstrate the continuing existence,
qualification, and authority of SHE to execute this Agreement and to perform the acts
necessary to carry out the Project.
6.7 Marketing Plan. SHE shall adopt and provide City with a marketing plan detailing
the procedures, requirements, and assessment criteria for affirmatively,marketing the
Affordable Housing that comprises the Project. SHE shall provide City with
documents/instruments to be used in connection with the Project, subject to reasonable
approval by City. Each Home buyer Family shall enter into and comply with the
standard form SHE Membership and Building Agreement (Builder/Buyer Group), and in
pursuit thereof each such Family shall complete not less than forty (40) hours/week of
labor improving the Project/Home. All buyers must complete the Homeowner Training
Course offered by SHE as an acknowledged HUD Housing Counseling Agency as a
condition of closing escrow on the Home purchase transaction. The City shall not be
liable or responsible for any real estate commissions, brokerage fees or finders fees
which may arise from this Agreement. The SHE and the City each represent that
neither has engaged any broker, agent or finder in connection with this transaction.
6.8 Permits and Approvals. SHE, at its sole cost and expense, shall provide to City
copies of any and all permit approvals and authorizations including plot plan, plat,
zoning variances, sewer, building, and other permits required by governmental
authorities in pursuit of the Project and for its stated purposes in accordance with all
applicable building, environmental, ecological, landmark, subdivision, and zoning
codes, laws, and regulations. SHE is responsible, at its sole cost and expense, to
determine the location of any utilities on the Property and to negotiate with the utility
r companies for and to relocate the utilities, if any, as necessary to complete the Project.
6.9 Property Insurance. SHE shall, through or in addition to any and all insurance
24
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coverage required by Article 10, during the term hereof, maintain or cause to be
maintained in full force and effect during its time on title (a) policy(ies) of property
insurance or comparable coverage, acceptable to the City, covering the Project
Property with limits reflective of the value of the.Project Improvements upon issuance of
the Certificate of Completion.
ARTICLE 7. PREDEVELOPMENT OF PROJECT
Without waiver of limitation, the parties agree as follows regarding Predevelopment of
the Project:
7.1 Contracts and Subcontracts. Any and all demolition, hazardous waste
abatement and construction work and professional services for the Project shall be
performed by persons or entities licensed or otherwise legally authorized to perform the
applicable work or service in the State of California and City of Fresno. SHE shall
provide City with copies of all agreements with any and all contractors or subcontractors
for this Project. SHE shall require that each agreement contain a provision whereby
the party(ies)to the agreement other than SHE agree to (i) notify City immediately of
any event of default by SHE thereunder; (ii) notify City immediately of the filing of a
mechanic's lien, (iii) notify City immediately of termination or cancellation of the
agreement; and (iv) provide City, upon City's request, an Estoppel Certificate certifying
that the agreement is in full force and effect and SHE is not in default thereunder. SHE
agrees to notify City immediately of termination or cancellation of any such
agreement(s), notice of filing of a mechanic's lien, or breach or default by other
party(ies) thereto. In the event SHE fails'to comply with its obligations hereunder, the
HOME Funds shall become immediately due and payable as provided for in this
Agreement.
7.2 Financing. SHE shall promptly inform City of any new financing or funding, and
SHE shall provide City copies of all agreements with any and all Funding Sources for
this Project. SHE shall require each agreement with any and all Funding Sources to
contain a provision whereby the party(ies)to the agreement other than SHE, agree to (i)
notify City immediately of any event of default by SHE thereunder; (ii) notify City
immediately of termination or cancellation of the agreement; and (iii) provide City, upon
City's request, an Estoppel Certificate certifying that the agreement is in full force and
effect and SHE is not in default thereunder. SHE agrees to notify City immediately of
termination or cancellation of any such agreement(s) or receipt of notice of default
thereunder. SHE shall comply with all obligations of any such agreement(s)with any
and all Funding Sources until the respective expiration of such agreement(s). In the
event SHE fails to comply with its obligations of this section, the HOME Funds shall
become immediately due and payable as provided for in this Agreement. This section
shall survive expiration or termination of this Agreement.
7.3 Insurance and Bonds. SHE shall submit for City approval bonds, certificates
and applicable endorsements for all insurance and bonds required by this Agreement in
accordance with Article 10.
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7.4 Permits and Licenses. SHE shall submit for City approval, all the necessary
permits and licenses required for Commencement of Construction.
7.5 Plans and Specifications. Before Commencement of Construction, SHE shall
submit to City, for its review and approval, the final Plans and Specifications for the
Project, which approved Plans and Specifications are by this reference incorporated
herein. SHE will construct the Homes in full conformance with the Plans and
Specifications and modifications thereto approved by City. SHE shall obtain City's prior
written approval for any modifications to the Plans and Specifications.
ARTICLE 8. DEVELOPMENT OF PROJECT
Without waiver of limitation, the parties agree as follows regarding Development of the
Project:
8.1 ADA/Barriers to the Disabled. The Homes shall be constructed and maintained
to comply with all applicable federal, state and local accessibility requirements.
8.2 Audits. Annually, beginning July 1st, 2004 and ending June 30th of the year
following the year that this Agreement terminates or expires, SHE, at its sole cost and
expense shall submit to City audited Financial Statements covering the income and
expenses, and the financial transactions for the Project during the prior fiscal year, July
1st through June 30th. SHE shall make available for examination at reasonable
intervals and during normal business hours to City all books, accounts, reports, files
and other papers or property with respect to all matters covered by this Agreement, and
shall permit City to audit, examine and make excerpts or transcripts from such records.
City may audit any conditions relating to this Agreement at the City's expense, unless
such audit shows a significant discrepancy in information reported by SHE to City in
which case SHE shall bear the cost of such audit. SHE shall also comply with any
applicable audit requirements of 24 CFR 92.506. This section shall survive expiration
or termination of this Agreement.
8.3 Books, Records and Documents. SHE shall be accountable to City for all HOME
Funds disbursed to SHE pursuant to the Agreement. The City shall have the right at all
reasonable times to inspect or perform an audit, in accordance with Section 8.2, of
SHE's books, records and other documents pertaining to the Project or this Agreement
and for up to four(4) years after the expiration or termination of this Agreement. SHE
will maintain books and records for the Project using generally accepted accounting
principles. SHE agrees to maintain books and records that accurately and fully show
the date, amount, purpose and payee of all expenditures reimbursed from HOME
CHDO Funds and to keep all invoices, receipts and other documents related to
expenditures reimbursed from HOME CHDO Funds for not less than four(4) years
after the expiration or termination of the Agreement. Books and records must be kept
accurate and current. For purposes of this section, "books, records and documents"
include, without limitation, plans, drawings, specifications, ledgers,journals, statements,
contracts/agreements, funding information, purchase orders, invoices, loan documents,
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computer printouts, correspondence, memoranda and electronically stored versions of
the foregoing. This section shall survive the expiration or termination of this Agreement.
8.4 Certificate(s) of Completion. Upon completion of the construction of the Project
or portion thereof, or in the discretion of the City any phase thereof, SHE's architect
shall certify in writing to City that the Homes have been constructed in accordance with
the Plans and Specifications and this Agreement. Upon (1)the architect's certification,
(2) a determination of final Project costs, (3) a determination by City that SHE has
completed the work in full conformance with industry standards and the Plans and
Specifications, (4) a determination by City that SHE is in compliance with all of SHE's
obligations under this Agreement City shall furnish within 30 calendar days of a written
request by SHE, a recordable Certificate of Completion for the Project or portion
thereof. City will not unreasonably withhold or delay furnishing the Certificate of
Completion. If City fails to provide the Certificate of Completion within the specified
time, it shall provide SHE with a written statement indicating in what respects SHE has
failed to complete construction of the Homes in conformance with this Agreement or
has otherwise failed to comply with the terms of this Agreement, and what measures
SHE will need to take or what standards it will need to meet in order to obtain the
Certificate of Completion. Upon SHE taking the specified measures and meeting the
specified standards, SHE will certify to City in writing of such compliance and City shall
deliver the recordable Certificate of Completion to SHE in accordance with.the
provisions of this section.
8.5 Commencement of Construction. SHE shall begin construction upon the earlier
of one hundred eighty(180) days from the effective date of this Agreement or SHE's
receipt of City's written Notice to Proceed. City shall issue a written Notice to Proceed
when all Predevelopment requirements in Article 7 have been met.
8.6 Completion of Construction. Following Commencement of Construction, SHE
shall diligently prosecute construction to completion, evidenced by the recorded
Certificate of Completion. SHE shall complete all Project construction work no later
than June 15, 2006.
8.7 Configuration of the Project. SHE shall construct the Homes in accordance with
the Plans and Specifications.
8.8 Damage to Property. To the extent consistent with the requirements of any
permitted encumbrance, or as otherwise approved by City, and subject to Article 10 of
this Agreement, if any building or improvement on the Property is damaged or
destroyed by an insurable cause, SHE shall, at its cost and expense, diligently
undertake to repair or restore said buildings and improvements consistent with the
original Plans and Specifications for the Project. Such work or repair shall commence
within ninety (90) days after the insurance proceeds are made available to SHE and
shall be complete within one year thereafter. All insurance proceeds collected for such
damage or destruction shall be applied to the cost.of such repairs or restoration and, if
such-insurance proceeds shall be insufficient for such purpose, SHE shall make up the
deficiency.
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8.9 Equal Employment Opportunity. SHE shall itself, and shall require that all its
contractors, subcontractors and service providers for the Project, comply with all
applicable local, state and federal requirements concerning equal employment
opportunity and shall incorporate such requirements in all contracts and subcontracts
for work on the Project.
8.10 Inspections. SHE shall permit, facilitate and require its contractors to permit and
facilitate observation and inspection at the job site by City and by public authorities
during reasonable business hours for the purpose of determining compliance with this
Agreement.
8.11 Fees, Taxes and Other Levies. SHE shall be responsible for payment of all fees,
assessments, taxes, charges and levies showing of record and imposed by any public
authority or utility company with respect to the Property or the Project, and shall pay
such charges prior to delinquency. Further, SHE shall be responsible for payment of all
fees, assessments, taxes, charges and levies not showing of record, provided that such
responsibility and liability shall be limited to and shall not exceed proceeds of SHE's
ALTA or CLTA] owner's policy of title insurance. However, SHE shall not be required
to pay and discharge any such charge so long as (a)the legality thereof is being
contested diligently and in good faith and by appropriate proceedings, and (b) if
requested by City, SHE deposits with City any funds or other forms of assurance City in
good faith from time to time determines appropriate to protect City from the
consequences of the contest being unsuccessful.
8.12 Mechanic's Liens and Stop Notices. If any claim of lien is filed against the
Property or a stop notice affecting any financing, HOME CHDO Funds or Funding
Sources for the Project is served on City or any other third party in connection with the
Project, SHE shall, within twenty (20) days of such filing or service, either pay and fully
discharge the lien or stop notice, effect the release of such lien or stop notice by
delivering to City a surety bond in sufficient form and amount, or provide City with other
assurance satisfactory to City that the claim of lien or stop notice will be paid or
discharged.
If SHE fails to discharge, bond or otherwise satisfy City with respect to any lien,
encumbrance, charge or claim referred to in this Section 8.12, then in addition to any
other right or remedy, City may, but shall not be obligated to, discharge such lien,
encumbrance, charge, or claim at SHE's expense. Alternatively, City may require SHE
to immediately deposit with City the amount necessary to satisfy such lien or claim and
any costs, pending resolution thereof. City may use such deposit to satisfy any claim or
lien that is adversely determined against SHE. SHE hereby agrees to indemnify and
hold City harmless from liability for such liens, encumbrances, charges or claims
together with all related costs and expenses.
8.13 Project Responsibilities. SHE shall be solely responsible for all aspects of SHE's
conduct in connection with the Project, including, but not limited to, the applicability of
and compliance with all local, state and federal laws including without limitation
prevailing wage and competitive bidding requirements, the quality and suitability of the
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Plans and Specifications, the supervision of construction work and the qualifications,
financial conditions of and performance of all contractors, subcontractors and suppliers.
Any review or inspection undertaken by the City with reference to the Project is solely
for the purpose of determining whether SHE is properly discharging its obligations to
City, and shall not be relied upon by SHE or by any third parties as a warranty or
representation by City as to the quality of the construction of the Homes.
8.14 Quality of Work. SHE shall construct the Homes and shall employ building
materials of a quality suitable for the requirements of the Project. SHE shall complete
construction of the Homes on the Property in full conformance with applicable local,
state and federal laws, statues, regulations and building and housing codes.
8.15 Relocation. If and to the extent that development of the Project results in the
permanent or temporary displacement of residential tenants, homeowners or
businesses, SHE shall comply with all applicable local, state and federal statutes and
regulations with respect to relocation planning, advisory assistance and payment of
monetary benefits. SHE shall be solely responsible for payment of any relocation
benefits to any displaced persons and any other obligations associated with complying
with said relocation laws.
8.16 Reporting Requirements. SHE shall submit to City all the following reports:
A. Within thirty (30)days after the selection of the families for each phase
SHE shall provide the City with a Home buyer demographics report including name,
current address, number in household, household income, total sale price of home,
itemization of financing and ethnicity.
B. From the date of execution of this Agreement until issuance of'a final
Project Certificate of Completion, SHE shall submit a Quarterly Report, in a form
approved by City, which will include, at a minimum, the following information: progress
reports outlining the status of the Project; purposes for which HOME CHDO Funds were
used and affirmative marketing efforts. The quarterly reports are due ten (10) days
from the date of the end of each quarter on April 10, July 10, October 10, and January
10. '
C. Annually, beginning July 15, 2004, and continuing for a period of one (1)
year following expiration of the Affordability Period, SHE shall submit an Annual Report
to City, in a form approved by City. The Annual Report shall summarize the year's
activities and shall include for each Home covered by this Agreement: the sale price,
the annual income and the family size of the Household. The report shall also state the
date of transfer of title for each Home, certification from an officer of SHE that the
Project is in compliance with the Affordable Housing requirements, and such other
information the City may be required by law to obtain. SHE shall provide any additional
information reasonably requested by City.
D. Upon execution of this Agreement, and at any time thereafter upon the
request of City, SHE shall submit proof of insurance as required in Article 10.
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8.17 Scheduling and Extension of Time; Unavoidable Delay in Performance. It shall
be the responsibility of SHE to coordinate and schedule the work to be..performed so
that Commencement of Construction and issuance'of the Certificate of Completion will
take place in accordance with the provisions of the Agreement. City, through its City
Manager or his/her designee, may extend such time in writing at its sole and absolute
discretion.
The time for performance of provisions of the Agreement by either party shall be
extended for a period equal to the period of any delay directly affecting the Project or
this Agreement which is caused by: war; insurrection; strike or other labor disputes;
lock-outs; riots; floods; earthquakes; fires;•casualties; acts of God; acts of a public
enemy; epidemics; quarantine restrictions; freight embargoes; lack of transportation;
suits filed by third parties concerning or arising out of this Agreement; or unseasonable
weather conditions. An extension of time for any of the above-specified causes will be
granted only if written notice by the party claiming such extension is sent to the other
party within ten (10) calendar days from the date the affected party learns of the
commencement of the cause and.the resulting delay and such extension of time is
accepted by the other party in writing. In any event, construction of the Homes must be
completed no later than one hundred twenty(120) calendar days after the scheduled
completion date specified in this Agreement, notwithstanding any delay caused by that
included in.this section.
8.18 Transfer. .The parties acknowledge that SHE holds the Project Property
primarily for sale to Low Income Families for use as purchaser's principal residence.
SHE may, to the extent allowed by controlling law and terms, conditions, restrictions
and covenants of this Agreement, ,and subject thereto, and upon securing any and all
required consents, approvals, permissions set forth therein including the prior written
consent of the City, on issuance by City of the Certificate of Completion, transfer and
assign all its right, title and interest in the Property, Project and/or this Agreement. Any
and all initial Home sales to Low Income Families as provided hereunder shall occur not
later than June 15, 2006, unless the parties mutually agree otherwise in a writing
added as an amendment hereto. During the entirety of the Affordability Period, all
Homes shall be subject to resale and recapture provisions contained herein and in the
Consolidated Plan, in accordance with 24 CFR 92.254.
"ARTICLE 9. PROJECT OPERATIONS
9.1 Operation of Project. SHE and SHE's authorized agents shall hold and maintain
the Project in full conformity with the terms of this Agreement.
9.2 Occupancy Requirements. The Homes shall be sold to and occupied by Low-
Income Families as owner occupants for the term of this Agreement and the _
Affordability Period. SHE shall comply with the income targeting and Affordable
Housing requirements of 24 CFR 92.217 and 92.254. No Home buyer shall take
occupancy of any Home prior to the close of escrow vesting title in said Home buyer.
9.3 Fair Marketing Plan. No later than thirty(30) calendar days from and after the
d
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effective date hereof, SHE shall submit to City for review and approval a plan for
marketing the Homes ("Fair Marketing Plan"). The Fair Marketing Plan shall address in
detail how SHE plans to market the availability of Homes to prospective purchasers and
how SHE plans to certify the eligibility of purchasers. SHE shall abide by the terms of
this Fair Marketing Plan, approved by City, in marketing the Homes.
9.4 Maintenance and Security. During its time on title, SHE shall (i) at its own
expense maintain the Homes in good condition, in good repair and in decent, safe,
sanitary, habitable and tenantable living conditions for the benefit of the purchasers, (ii)
not commit or permit any waste on or to the Homes, and shall prevent and/or rectify any
physical deterioration of the Homes; and (iii) maintain the Homes in conformance with
all applicable federal, state and local laws, ordinances, codes and regulations and this
Agreement, until such are sold to low income buyers.
9.5 Nondiscrimination. The Homes shall be available for sale/occupancy to
members of the general public who are income eligible. SHE shall not illegally
discriminate or segregate in the development, construction, use, enjoyment, occupancy,
or conveyance of any part of the Project or Property on the basis of race, color,
ancestry, national origin, religion, sex, age, marital status, family status, source of
income/assistance subsidy, physical or mental disability, Acquired Immune Deficiency
Syndrome (AIDS) or AIDS-related conditions (ARC), sexual orientation or any other
arbitrary basis. SHE shall otherwise comply with all applicable local, state and federal
laws concerning nondiscrimination in housing. Neither SHE nor any person claiming
under or through SHE, shall establish or permit any such practice or practices of illegal
discrimination or segregation with reference to the selection, location, number, use or
occupancy of buyers of any Home or in connection with employment of persons for the
operation of the Project and management of any Home. All deeds or contracts made or
entered into by SHE as to the Homes shall contain covenants concerning
nondiscrimination consistent with this section. SHE shall include a statement in all
advertisements, notices and signs for availability of the Homes to the effect that SHE is
an Equal Housing Opportunity Provider.
Nothing in this,section is intended to require SHE to change the character,
design, use or operation of the Project; or to require SHE to obtain licenses or permits
other than those required for Affordable Housing for persons capable of independent
living.
9.6 Project Home Sale.Price and Disposition of Project Proceeds/Income. The initial
sale price of each Home is the total amount paid by the Home buyer to SHE for the
Home conveyance, inclusive of any first lien/loan and exclusive of escrow fees, title
insurance costs, broker's commission (if any), loan fees or any other closing or
transaction costs. Subject to the provisions set forth herein below, the value of capital
improvements to the Home with a cost for each capital improvement in excess of Two
Thousand Five Hundred Collars ($2500) made while Home buyer owns and occupies
the Home,(hereinafter"Qualified Capital Improvements") but expressly excluding any
improvements made prior to such ownership and occupancy by the Home buyer, shall
be added to the sale price upon subsequent sale and disposition of sale proceeds
31
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including any equity sharing. The amount attributable to Qualified Capital
Improvements shall be adjusted for Home'appreciation/depreciation at time of
subsequent sale.
The value of Qualified Capital Improvements shall be added to the sale price as
provided above only if, upon completion of such Qualified Capital Improvements and
not later than sixty (60) days prior to the subsequent sale or disposition, Home buyer
submits the following to SHE: (i) an itemized list of the Qualified.Capital Improvements,
(ii) reliable proof of completion of the Qualified Capital Improvements (as evidenced
e.g. by final building permits or certificate of completion), (iii) reliable evidence of the
cost of the Qualified Capital Improvements (as evidenced e.g. by an itemized invoice or
receipt), and (iv) an estimate of the increase in the fair market value of the Home by
reason of the Qualified Capital Improvements (subject to SHE confirmation of values).
Notwithstanding the foregoing, if Home buyer performs at least one half of the value of
the labor or other work involved, then the cost of the Capital Improvements will not be
considered, and each such Capital Improvement must have an appraised value
exceeding Two Thousand Five Hundred Dollars ($2500)to be added to the sale price
as provided above. If, within thirty(30) days of receipt of the information concerning the
Qualified Capital Improvements, SHE questions the claimed increase in the value of
the Home by reason of said Qualified Capital Improvements, SHE and the Home buyer
may, by mutual agreement, establish the value of the Qualified Capital Improvements
or SHE may require an appraisal of the Home conducted at Home buyer's expense by
an independent certified appraised appointed by SHE to determine the fair market
value of the Qualified Capital Improvements, which determination shall be binding upon
Home buyer.
Notwithstanding the foregoing, the sale price of each Home (i) shall not be less than
the value fixed by SHE independent appraisal, and (ii) shall not exceed ninety five
percent (95%) of the median purchase price for the area as applied under 24 CFR
92.254. City shall approve in advance all Home buyers. Home buyer financing shall be
based upon buyer's ability to pay.
9.7 Affordable Housing. The purpose of this Agreement is to use Home Funds to
develop the Affordable Housing Project and to ensure that said funds continue to
benefit lower-income households for the Affordability Period. SHE and those taking
under or through it, covenant and agree that the Project shall constitute Affordable
Housing during the entire Affordability Period. If a Home initially built and sold to a
lower-income household is subsequently resold, it must be sold to another lower-
income household, or upon the City's written consent and release of affordability
restriction as to the subject Home the City's pro rata investment attributable to HOME
Program Funds, net of Home buyer's non-federally assisted cash down payment and
capital investment (if any) adjusted to reflect market value at time of sale, must be
recaptured by SHE for home ownership opportunities within the City as may be eligible
under the HOME Program, or remitted to City's Home Program Trust Fund. Any
limitations to this level of recapture imposed by primary mortgage lenders will be
approved by City prior to the consummation of the first sale of the property. SHE shall
have the option of exercising a first right of refusal or purchase option, for an amount
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representing Home buyer's equity(i.e. an amount representing Home buyer's non-
federally assisted cash down payment and capital investment (if any) adjusted to reflect
market value at time of sale), to ensure long term affordability of each Home. SHE
shall provide, in a form acceptable to the City, a Trust Deed Note substantially in the
form of Exhibit "G" attached hereto securing the Loan of HOME Funds by City to SHE
for Eligible Project Costs. The Trust Deed Note shall be proratable by each Project
Home and subject to pro rata assignment to/assumption by Home buyer(s) upon City's
written consent. In the event of a default on the Note and/or a failure to comply with the
time period in which the Project must constitute Affordable Housing, in addition to any
and all other remedies available to it, City shall be entitled to enjoin sale of the Project
Home(s) as other than Affordable Housing, damages not being an adequate remedy at
law for such breach.
ARTICLE 10. INDEMNITY, INSURANCE AND BONDS
Without waiver of limitation, the parties agree as follows regarding SHE's Insurance,
Indemnity and Bond Obligations:
10.1 Insurance Coverage. During the entire Term of Agreement, SHE, itself or
through its contractors and subcontractors, shall pay for and maintain in full force and
effect all policies of insurance required hereunder with an insurance company(ies)
either (1) admitted by the California Insurance Commissioner to do business in the
State of California and rated not less than "A-VII" in Best's Insurance Rating Guide, or
(2) authorized by City's Risk Manager. The following policies of insurance are required:
A. COMMERCIAL GENERAL LIABILITY insurance which shall include
contractual, products and completed operations coverages, bodily injury and property
damage liability insurance with combined single limits of not less than One Million
Dollars ($1,000,000) per occurrence.
B. COMMERCIAL AUTOMOBILE LIABILITY insurance, endorsed for "any
auto" with combined single limits of liability of not less than One Million Dollars
($1,000,000) per occurrence.
C. WORKERS' COMPENSATION insurance as required under the
California Labor Code.
D. BUILDERS RISK INSURANCE in an amount to provide coverage to 100
percent (100%) of the replacement value of the Project, including terms of labor and
materials in,place or to be used as part of the permanent construction, including surplus
miscellaneous materials and supplies incidental to the work and such scaffolding,
staging, towers, forms and equipment as are not owned or rented by the SHE, the cost
of which is not included in the cost of work.
E. PROFESSIONAL LIABILITY INSURANCE with a coverage limit of not
less than One Million Dollars ($1,000,000) per occurrence, provided that such coverage
shall be required solely for Project subdivision site design work and not otherwise, and
33
further provided that SHE may cause such coverage to be provided by its retained civil
engineer(s) rather than by SHE itself.
The above described policies of insurance shall be endorsed to provide an
unrestricted thirty(30) day written notice in favor of City, of policy cancellation, change
or reduction of coverage, except for the Workers' Compensation policy which shall
provide a ten (10) day written notice of such cancellation, change or reduction of
coverage. In the event any policies are due to expire during the term of this Agreement,
SHE shall provide a new certificate evidencing renewal of such policy not less than
fifteen (15) days prior to the expiration date of the expiring policy(ies). Upon issuance
by the insurer, broker, or agent of a notice of cancellation, change or reduction in
coverage, SHE shall file with City a certified copy of the new or renewal policy and
certificates for such policy.
The General Liability, Automobile Liability, Builder's Risk and Professional
Liability insurance policies shall be written on an occurrence form and shall name City,
its officers, officials, agents, employees and volunteers as an additional insured. Such
policy(ies) of insurance shall be endorsed so SHE's insurance shall be primary and no
contribution shall be required of City. SHE shall furnish City with the certificate(s) and
applicable endorsements for ALL required insurance prior to City's execution of this
Agreement. SHE shall furnish City with copies of the actual policies upon the request
of City's Risk Manager at any time during the life of the Agreement or thereafter. This
section shall survive termination or expiration of this Agreement.
If at any time during the life of this Agreement or any extension, SHE fails to
maintain the required insurance in full force and effect, all work under this Agreement
shall be discontinued immediately, and all payments due or that become due to SHE
shall be withheld until notice is received by City that the required insurance has been
restored to full force and effect and that the premiums therefore have been paid for a
period satisfactory to City. Any failure to maintain the required insurance shall be
sufficient cause for City to terminate this Agreement.
If SHE should contract all or any portion of the work to be performed under this
Agreement other than to professional service providers as provided in Section 10.3,
SHE shall require each contractor and subcontractor to provide insurance protection in
favor of City, its officers, officials, employees, agents and volunteers in accordance with
the terms of each of the preceding paragraphs, except that the contractors' and
subcontractors' certificates and endorsements shall be on file with SHE and City prior to
the commencement of any work by the respective contractor or subcontractor.
The City's Risk Manager may, but is not obligated to, accept other than an "any
auto" endorsement for commercial automobile liability insurance upon prior written
request certifying the reasons for the request.
i 10.2 Indemnity. SHE shall indemnify, hold harmless and defend City and each of its
officers, officials, employees, agents and volunteers from any and all loss, liability,
34
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fines, penalties, forfeitures, costs and damages (whether in contract, tort or strict
liability, including but not limited to personal injury, death at any time and property
damage) incurred by City, SHE or any other person, and from any and all claims,
demands and actions in law or equity(including attorney's fees and litigation expenses),
arising or alleged to have arisen directly or indirectly out of performance of this
Agreement. SHE's obligations under the preceding sentence shall apply regardless of
whether City or any of its officers, officials, employees, agents or volunteers are actively
or passively negligent, but shall not apply to any loss, liability, fines, penalties,
forfeitures, costs or damages caused solely by the active negligence or by the willful
misconduct of City or any of its officers, officials, employees, agents or volunteers.
If SHE should contract all or any portion of the work to be performed under this
Agreement other than professional service providers as provided in Section 10.3, SHE
shall require each contractor and subcontractor to indemnify, hold harmless and defend
City and each of its officers, officials, employees, agents and volunteers in accordance
with the terms of the preceding paragraph. This section shall survive termination or
expiration of this Agreement.
10.3 Professional Services. If SHE should contract all or any portion of the work to be
performed under this Agreement to any consultant, architect, landscape architect,
engineer, or construction project manager, then SHE shall require each such contractor
and subcontractor to indemnify, hold harmless and defend City and each of its officers,
officials, employees, agents and volunteers in accordance with the terms of the
following Subsection A and to provide insurance protection in favor of City, its officers,
officials, employees, agents and volunteers in accordance with the terms of the
following Subsection B, except that the contractors' and subcontractors' certificates and
endorsements shall be on file with SHE and City prior to the commencement of any
work by the respective contractor or subcontractor.
A. Indemnification. Except with regard to professional negligent errors and
omissions, as provided in the paragraph below, Contractor shall indemnify, hold
harmless and 'defend City and each of its officers, officials, employees, agents and
volunteers from any and all loss, liability, fines, penalties, forfeitures, costs and
damages (whether in contract, tort or strict liability, including but not limited to personal
injury, death at any time and property damage) incurred by City, Contractor or any other
person, and from any and all claims, demands and actions in law or equity(including
attorney's fees and litigation expenses), arising or alleged to have arisen directly or
indirectly out of performance of this Agreement. Contractor's obligations under the
preceding sentence shall apply regardless of whether City or any of its officers,
officials, employees, agents or volunteers are actively or passively negligent, but shall
not apply to any loss, liability, fines, penalties, forfeitures, costs or damages caused
solely by the active negligence or by the willful misconduct of City or any of its officers,
officials, employees, agents or volunteers.
Specifically regarding professional negligent errors and omissions,
Contractor shall indemnify, hold harmless and defend City and each of its officers,
officials, employees, agents and volunteers from any and all loss, liability, fines,
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a
penalties, forfeitures, costs and damages (whether in contract, tort or strict liability,
including but not limited to personal injury, death at any time and property damage)
incurred by City, Contractor or any other person, and from any and all claims, demands
and actions in law or equity(including attorney's fees and litigation expenses), to the
proportionate extent that it arises out of or in connection with the professional negligent
errors or omissions of Contractor in the performance of this Agreement.
If Contractor should subcontract all or any portion of the work to be
performed under this Agreement, Contractor shall require each contractor and
subcontractor to indemnify, hold harmless and defend City and each of its officers,
officials, employees, agents and volunteers_ in accordance with the terms of the
preceding paragraphs.
This section shall survive termination or expiration of this Agreement.
B. Insurance. Throughout the life of this Agreement, Contractor shall pay for
and maintain in full force and effect all policies of insurance required hereunder with an
insurance company(ies) either(i) admitted by the California Insurance Commissioner to
do business in the State of California and rated not less than "A- VII" in Best's
Insurance Rating Guide, or(ii) authorized by City'S Risk Manager. The following
policies of insurance are required:
i. COMMERCIAL GENERAL LIABILITY insurance which shall include
contractual, products and completed operations coverages, bodily injury and property
damage liability insurance with combined single limits of not less than One Million
Dollars ($1,000,000) per occurrence.
ii: COMMERCIAL AUTOMOBILE LIABILITY insurance, endorsed for
any auto" with combined single limits of liability of not less than One Million Dollars
($1,000,000) per occurrence.
iii. PROFESSIONAL LIABILITY insurance (Errors and Omissions)
solely for Project subdivision site design work and not otherwise, with a limit of liability
of not less than One Million Dollars ($1,000,000) per occurrence.
iv. WORKERS' COMPENSATION insurance as required under the
California Labor Code.
The above described policies of insurance shall be endorsed to provide
an unrestricted thirty(30)day written notice in favor of City, of policy cancellation,
change or reduction of coverage, except for the Workers' Compensation policy which
shall provide a ten (10)day written notice of such cancellation, change or reduction of
coverage. In the event any policies are due to expire during the term of this Agreement,
Contractor shall provide a new certificate evidencing renewal of such policy not less
than fifteen (15)days prior to the expiration date of the expiring policy(ies). Upon
issuance by the insurer, broker, or agent of a notice of cancellation, change or
reduction in coverage, Contractor shall file with City a certified copy of the new or
36
renewal policy and certificates for such policy.
The General Liability, Automobile Liability and Professional Liability
insurance policies shall be written on an occurrence form and shall name City, its
officers, officials, agents, employees and volunteers as an additional insured. Such
policy(ies) of insurance shall be endorsed so Contractor's insurance shall be primary
and no contribution shall be required of.City. In the event claims made forms are used
for any Professional Liability coverage, either(i) the policy(ies) shall be endorsed to
provide not less than a five (5) year discovery period, or(ii) the coverage shall be
maintained for a minimum of five (5) years following the termination of this Agreement
and the requirements of this section relating to such coverage shall survive termination
or expiration of this Agreement. -Contractor shall furnish City with the certificate(s) and
applicable endorsements for ALL required insurance prior to SHE'S execution of the
Agreement. Contractor shall furnish City with copies of the actual policies upon the
request of City's Risk Manager at any time during the life of the Agreement or any
extension.
If at any time during the life of the Agreement or any extension, Contractor
fails to maintain the required insurance in full force and effect, all work under this
Agreement shall be discontinued immediately, and all payments due or that become
due to Contractor shall be withheld until notice is received by SHE and City that the
required insurance has been restored to full force and effect and that the premiums
therefore have been paid for a period satisfactory to City. Any failure to maintain the
required insurance shall be sufficient cause for SHE to terminate this Agreement.
If Contractor should subcontract all or any portion of the work to be
performed under this Agreement, Contractor shall require each contractor and
subcontractor to provide insurance protection in favor of City, its officers, officials,
employees, agents and volunteers in accordance with the terms of each of the
preceding paragraphs, except that the contractors' and subcontractors' certificates and
endorsements shall be on file with SHE and City prior to the commencement of any
work by the respective contractor or subcontractor.
10.4 Property Insurance. SHE shall pay for and maintain, throughout the remaining
life of this Agreement, property insurance including fire and ECE coverage, or
comparable coverage, in an amount, form, substance, and quality acceptable to the
City's Risk Manager. The parties acknowledge and agree that the Property is located in
Flood Area Zone "B", and based thereon the parties further acknowledge and agree
that SHE shall not be required to procure Project flood insurance coverage.
10.5 Bond Obligations. SHE shall obtain, pay for and deliver two good and sufficient
surety bonds from a corporate surety, admitted by the California Insurance
Commissioner to do business in the State of California and Treasury-listed, in a form
satisfactory to the City and naming the City as Obligee.
A. The "Faithful Performance Bond" shall be for 100 percent (100%) of the
Home CHDO Fund Grant/Loan provided for in this Agreement to guarantee faithful
37
performance of the Project, within the time prescribed, in,a manner satisfactory to the
City, and that all materials and workmanship will be free from original or developed
defects.
B. The "Material and Labor Bond" shall be for not less than 100 percent of
the Home CHDO Fund Grant/Loan provided for in this Agreement, to satisfy claims of
material supplies and of mechanics and laborers employed by SHE on the Project. The
bond shall be maintained by the SHE in full force and effect until the Project is
completed and accepted by the City, and until all claims for materials and labor are
paid, and shall otherwise comply with any applicable provisions of Chapter 7, Title 15,
Part 4, Division 3 of the California Civil Code.
ARTICLE 11. DEFAULT AND REMEDIES
11.1 Events of Default. The parties agree that each of the following shall constitute
an "Event of Default" for purposes of this Agreement:
A. SHE's use of HOME CHDO Funds for costs other than Eligible Costs or
for uses not permitted by the terms of this Agreement.
B. SHE's failure to obtain and maintain the insurance coverage required
under this Agreement.
C. The failure of SHE to make any payment according to the tenor and effect
of this Agreement, including, but not limited to, any payment of principal, interest,
premiums, penalties, taxes, etc., when and as the same shall become due and payable,
whether at maturity, by acceleration, or otherwise.
D. Except as otherwise provided in this Agreement, the failure of SHE to
punctually and properly perform any other covenant or agreement contained in this
Agreement including without limitation the following: (1) SHE's substantial deviation in
the construction work specified in the Plans and Specifications submitted to City,
without City's prior written consent; (2) SHE's use of defective or unauthorized materials
or defective workmanship in constructing the Rental Housing; (3) SHE's failure to
commence or complete construction, as specified in this Agreement, unless delay is
permitted under this Agreement; (4)the cessation of construction for a period of more
than 15 consecutive days (other than as provided in this Agreement) prior to submitting
to City, certification that the Project is complete; (5) any material adverse change in the
condition of SHE or the Project that gives City reasonable cause to believe that
construction on the Homes cannot be completed by the scheduled completion date
according to the terms of this Agreement; (6) SHE's failure to remedy any deficiencies
in record keeping or failure to provide records to City upon City's request; (7) SHE's
failure to substantially comply with any federal, state or local laws or applicable City
restrictions governing construction of the Homes hereunder, including but not limited to
provisions of this Agreement pertaining to equal employment opportunity,
nondiscrimination and lead-based paint.
38
ti
'e E. Any representation, warranty, or certificate given or furnished by or on
behalf of SHE shall prove to be materially false as of the date of which the
representation, warranty, or certification was given, or that SHE concealed or failed to
disclose a material fact to City, provided, however, that if any representation, warranty,
or certification that proves to be materially false is due merely to SHE's inadvertence,
SHE shall have a thirty (30) day opportunity after written notice thereof to cause such
representation, warranty, or certification to be true and complete in every respect.
F. SHE shall file, or have filed against it, a petition of bankruptcy, insolvency,
or similar law, state or federal, or shall file any petition or answer seeking, consenting
to, or acquiescing in any reorganization, arrangement, composition, readjustment,
liquidation, dissolution, or similar relief, and such petition shall not have been vacated
within fourteen (14) days; or shall be adjudicated bankrupt or insolvent, under any
present or future statute, law, regulation, under state or federal law, and such judgment
or decree is not vacated or set aside within fourteen (14) days.
G. SHE's failure, inability or admission in writing of its inability to pay its debts
as they become due or SHE's assignment for the benefit of creditors.
H. A receiver, trustee, or liquidator shall be appointed for SHE or any
substantial part of SHE's assets or properties, and not be removed within ten (10) days.
I. The failure of SHE to complete the construction of the Project on or prior
to June 10, 2006.
J. SHE's breach of any other material condition, covenant, warranty, promise
or representation contained in this Agreement not otherwise identified within this
Section 11.1.
K. Any substantial or continuous breach by SHE of any material obligation
owed by SHE imposed by any other agreement with respect to the financing or
development or operation of the Project, whether or not City is a party to such
agreement.
11.2 Notice of Default and Opportunity to Cure. City shall give written notice to SHE
of any Event of Default by specifying (1)the nature of the event or deficiency giving rise
to the default, (2) the action required to cure the deficiency, if any action to cure is
possible, and (3) a date, which shall not be less than 30 calendar days from the date of
the notice, by which such deficiency must be cured, provided, however that if such
failure cannot be remedied in such time, SHE shall have an additional thirty (30) days to
remedy such failure so long as SHE is&igently and in good faith pursuing such
remedy.
11.3 Remedies Upon an Event of Default. Upon the happening of an Event of Default
by SHE and a failure to cure said Event of Default within the time specified in the notice
of Event of Default, City's obligation to disburse HOME CHDO Funds shall terminate,
and City may also at its option and without notice institute any action, suit, or other
39
8.
proceeding in law, in equity or otherwise, which it shall deem necessary or proper for
the protection of its interests and may without limitation proceed with any or all of the
following remedies in any order or combination City may choose in its sole discretion:
A. Terminate this Agreement immediately upon written notice to SHE, in
which event all HOME CHDO Funds disbursed to SHE by City shall be returned to City;
B. Bring an action in equitable relief(1) seeking specific performance by
SHE of the terms and conditions of this Agreement, and/or(2) enjoining, abating or
preventing any violation of said terms and conditions, and/or(3) seeking declaratory
relief;
C. Pursue any other remedy allowed at law or in equity or under this
Agreement.
ARTICLE 12. GENERAL PROVISIONS
Without waiver or limitation, the parties agree that the following general provisions shall
apply in the performance hereof:
12.1 Amendments. No modification or amendment of any provision of this Agreement
shall be effective unless made in writing and signed by the parties hereto.
12.2 Archaeological Finds. If SHE discovers any artifacts during excavation and/or
construction, SHE shall stop all affected work and notify City, who will call in a qualified
archaeologist designated by the California Archaeological Inventory to assess the
discovery and suggest further mitigation, as necessary. If SHE discovers human
remains, SHE shall notify the City, who will be responsible for contacting the County
Coroner and a qualified archaeologist. If the remains are determined to be Native
American, the City shall contact the appropriate tribal representative to oversee the
removal of the remains.
12.3 Attorney's Fees. If either party is required to commence any proceeding or legal
action to enforce or interpret any term, covenant or condition of this Agreement, the
prevailing party will be entitled to recover from the other party its reasonable attorney's
fees and legal expenses.
12.4 Binding on All Successors and Assigns. Unless otherwise expressly provided in
this Agreement, all the terms and provisions of this Agreement shall be binding on and
inure to the benefit of the parties hereto, and their respective heirs, successors,
assigns, and legal representatives.
12.5 Counterparts. This Agreement may be executed in counterparts, each of which
when executed and delivered will be deemed an original, and all of which together will
constitute one instrument. The execution of this Agreement by any party hereto will not
become effective until counterparts hereof have been executed by all parties hereto.
40
F;
12.6 Disclaimer of Relationship. Nothing contained in this Agreement, nor any act of
City or of SHE, or of any other person, shall in and by itself be deemed or construed by
any person to create any relationship of third party beneficiary, or of principal and
agent, of limited or general partnership, or of joint venture.
12.7 Effective Date. This Agreement shall be effective upon the date first above
written.
12.8 Entire Agreement. This Agreement represents the entire and integrated
agreement of the parties with respect to the subject matter hereof. This Agreement
supersedes all prior negotiations, representations or agreements, either written or oral.
12.9 Exhibits. Each exhibit and attachment referenced in this Agreement is, by the
reference, incorporated into and made a part of this Agreement.
12.10 Expenses Incurred Upon Event of Default. SHE shall reimburse City for all
reasonable expenses and costs of collection and enforcement, including reasonable
attorney's fees, incurred by City as a result of one or more Events of Default by SHE
under this Agreement.
12.11 Governing Law and Venue. Except to the extent preempted by applicable
federal law, the laws of the State of California shall govern all aspects of this
Agreement, including execution, interpretation, performance, and enforcement. Venue
for filing any action to enforce or interpret this Agreement will be Fresno, California.
12.12 Headings. The headings of the articles, sections, and paragraphs used in this
Agreement are for convenience only and shall not be read or construed to affect the
meaning or construction of any provision.
12.13.Interpretation. This Agreement in its final form is the result of the combined
efforts of the parties. Any ambiguity will not be construed in favor or against any party,
but rather by construing the terms in accordance with their generally accepted meaning.
12.14 No Assignment or Succession. Except as may be otherwise expressly provided ,
by this Agreement, neither this Agreement, nor any interest of SHE in, under, or to this
Agreement, or the Project, may be assigned or transferred by SHE without the prior
written consent of City, which consent shall not be unreasonably withheld or delayed.
Any assignment without consent shall be voidable by City.
12.15 No Third-Party Beneficiary. No contractor, subcontractor, mechanic,
materialman, laborer, vendor, or other person hired or retained by or contracting with
SHE shall be, nor shall any of them be deemed to be, third-party beneficiaries of this
Agreement, but each such person shall be deemed to have agreed (a)that they shall
look to SHE as their sole source of recovery if not paid, and (b) except as otherwise
agreed to by City and any such person in writing, they may not enter any claim or bring
any such action against City under any circumstances. Except as provided by law, or as
otherwise agreed to in writing between City and such person, each such person shall
41
d ,
be deemed to have waived in writing all right to seek redress from City under any
circumstances whatsoever.
12.16 No Waiver. Neither failure nor delay on the part of City in exercising any right
under this Agreement shall operate as a waiver of such right, nor shall any single or
partial exercise of any such right preclude any further exercise thereof or the exercise of
any other right. No waiver of any provision of this Agreement or consent to any
departure by SHE therefrom shall be effective unless the same shall be in writing,
signed on behalf of City by a duly authorized officer thereof, and the same shall be
effective only in the specific instance for which it is given. No notice to or demand on
SHE in any case shall entitle SHE to any other or further notices or demands in similar
or other circumstances, or constitute a waiver of any of City's right to take other or
further action which is authorized without notice or demand.
12.17 Nonreliance. SHE hereby acknowledges having obtained such independent
legal or other advice as it has deemed necessary and declares that in no manner has it
relied on the City, it agents, employees or attorneys in entering into this Agreement.
12.18 Notice. Any notice to be given to either party under the terms of this Agreement
shall be given by certified United States mail, postage prepaid, return receipt requested,
at the addresses specified below, or at such other addresses as may be specified in
writing by the parties.
If to the City. Manager of the Housing land Community Development Division
Planning and Development Department
2600 Fresno Street, Room 3076
Fresno, CA.93721-3605
If to SHE: Self Help Enterprises Inc.
Attn: Tom Collishaw
P.O. Box 351
Visalia, CA 93279.
12.19 Precedence of Documents. In the event of any conflict between the body of this
Agreement and any exhibit or attachment hereto, the terms and conditions of the body
of this Agreement will control.
12.20 Recording of Documents. SHE agrees to cooperate with City and execute any
documents required, promptly upon City's request, and to promptly effectuate the
recordation of this Agreement, the Certificate of Completion, the Trust Deed Note(s),
Declaration of Restrictions and any other specified documents/instruments in the
Official Records of Fresno County, California as provided for in this Agreement.
} 12.21 Remedies Cumulative. All powers and remedies given by this Agreement shall
be cumulative and in addition to those otherwise provided by law.
' 12.22 Severability. The invalidity, illegality, or unenforceability of any one or more of
42
f C .
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the provisions of this Agreement shall not affect the validity, legality, or enforceability of
the remaining provisions hereof or thereof.
IN WITNESS WHEREOF, the parties have executed this Agreement at Fresno,
California, the day and year first above written.
CITY OF FRESNO SELF HELP ENTERPRISES, INC.
A Municipal Corporation A Nonprofit Corporation
By:
ANDREW T. SOU ZA THOMAS OL AW
Assistant City Manager Assistant Secretary
By.
CAROL A. GLASS
Assistant Secretary
(Attach notary certificate of acknowledgment)
ATTEST:
REBECCA E. KLISCH
(Attach notary certificate of acknowledgment)
By:
Deputy _
APPROVED-AS TO FORM`
HILDA CANTO MONTOY
By:
Deputy
43
CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
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( On June 15, 2004 before me, Maureen L. Barnes, Notary Public
Dale Name and Title of Officer(e.g.,'Jane Doe,Notary Public')
personally appeared Andrew T. Souza
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(' Description of Attached Document :)
Title or Type of Document: Willow/Jensen Proj ect Agreement )
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Description of Attached Document
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EXHIBIT A: DESCRIPTION OF REAL ESTATE AND SITE PLAN
LEGAL DESCRIPTION
PROPERTY LOCATED ON THE NORTHWEST CORNER OF JENSEN AND WILLOW
AVENUE IN THE CITY OF FRESNO, COUNTY OF FRESNO, STATE OF CALIFORNIA
DESCRIBED AS FOLLOWS:
LOTS 24 AND 25 OF NEWHALL TRACT, IN THE CITY OF FRESNO, COUNTY OF
FRESNO,STATE OF CALIFORNIA,ACCORDING TO THE MAP THEREOF RECORDED
IN BOOK 2 PAGE 42 OF RECORD OF SURVEYS, RECORDS OF SAID COUNTY.
EXCEPTING THEREFROM THOSE PORTIONS OF LOTS 24 AND 25 DESCRIBED AS
FOLLOWS:
BEGINNING ATTHE SOUTHEAST CORNER OF SAID LOT25;THENCE WESTALONG
THE SOUTH LINE OF SAID LOT 25, A DISTANCE OF 199.20 FEET; THENCE NORTH
02'59'55" EAST,A DISTANCE OF 629.25 FEET, MORE OR LESS,TO A POINT ON THE
NORTH LINE OF SAID LOT 25, SAID POINT BEING 198.85 FEET WEST OF THE
NORTHEAST CORNER OF SAID LOT 25; THENCE NORTH 89°59'44" EAST, ALONG
SAID NORTH LINE OF LOT 25, A DISTANCE OF 160.04 FEET TO A POINT ON THE
CENTER LINE OF THE CENTRAL CANAL; THENCE ALONG SAID CENTER LINE OF
THE CENTRAL CANAL SOUTH 48°37' EAST A DISTANCE OF 120.64 FEET AND
SOUTH 78°26' EAST A DISTANCE OF 109.24 FEET; THENCE SOUTH 2°58' WEST,
PARALLEL WITH THE WEST LINE OF SAID LOT 24 A DISTANCE OF 528.15 FEET TO
THE SOUTH LINE OF SAID LOT 24; THENCE WEST, ALONG SAID SOUTH LINE OF
LOT 24, A DISTANCE OF 172.00 FEET TO THE POINT OF BEGINNING;
ALSO EXCEPTING THEREFROM ANY PORTION OF SAID LOT 25 LYING WESTERLY
OF THE WESTERLY BOUNDARY LINE OF THE ABOVE DESCRIBED EXCEPTION;
ALSO EXCEPTING THEREFROM THE REMAINDER OF THE SOUTH 46 FEET
THEREOF;
ALSO EXCEPTING THEREFROM SAID LOT 24 A PARCEL OF LAND DESCRIBED AS
FOLLOWS:
BEGINNING AT A POINT 30 FEET WEST OF THE EAST BOUNDARY AND 76 FEET
NORTH OF THE SOUTH BOUNDARY OF THE SOUTHWEST HALF OF SECTION 18,
TOWNSHIP 14 SOUTH, RANGE 21 EAST, MOUNT DIABLO BASE AND MERIDIAN;
THENCE WESTERLY 76 FEET FROM AND PARALLEL TO THE SOUTH BOUNDARY
OF SAID SECTION 18; A DISTANCE OF 60 FEET; THENCE IN A NORTHEASTERLY
DIRECTION TO A POINT WHICH IS 106 FEET NORTH OF THE SOUTH BOUNDARY
AND 30 FEET WEST OF THE EAST BOUNDARY OF THE SOUTHWEST HALF OF SAID
SECTION 18; THENCE SOUTHERLY 30 FEET FROM AND PARALLEL TO THE EAST
V
AND ALSO EXCEPTING THEREFROM ALL THAT PORTION OF SAID LOTS 24 AND-25
LYING NORTHERLY OF THE CENTER LINE OF CENTRAL CANAL, AS SHOWN ON
THE MAP OF SAID TRACT.
(Please see attached Site Plan )
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EXHIBIT B: PROFORMA BUDGET
DEVELOPMENT BUDGET
CITY OF FRESNO SELF-HELP PROJECT
Aprit 27, 2004
Land Acquisition $ 567,000
Site Development $ 840,000
Local Permits/Impact Fees $ 500,000
Dwelling Structures $2,430,000
Soft Costs $ 700,000
Sweat Equity $ 390,000
Total Costs $5,427,000
SOURCES OF FUNDS
RCAC Ag Worker Housing Capitol Fund $1,000,000
City of Fresno HOME Funds $1,200,000
Sweat Equity $ 390,000
Wells Fargo Bank $2,700,000
Conventional Mortgage $1,800,000
Total Funding $5,627,000
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EXHIBIT C: [EXEMPLAR] CERTIFICATE OF COMPLETION
RECORDED AT THE REQUEST OF
AND WHEN RECORDED RETURN TO:
City of Fresno
Planning and Development Department
Housing and Community Development Division
2600 Fresno Street, Room 3076
Fresno, CA 93721-3605
Attention: Manager of Housing Community Development
(SPACE ABOVE THIS LINE FOR RECORDER'S USE)
This Certificate of Completion is recorded at the request and for the benefit of the City
of Fresno and is exempt from the payment of a recording fee pursuant to Government
Code Section 6103.
City of Fresno
By:
Its: Director of Planning and Development
Dated
7�
CERTIFICATE OF COMPLETION
Recitals:
A. By a Home Investment Partnerships Program Agreement(the ".Agreement")
dated June 10, 2004 between the City of Fresno, a municipal corporation ("City"), and
Self Help Enterprises Inc., a California non-profit public benefit corporation ("SHE"),
SHE agreed to construct an Affordable Housing Project in three (3) phases,
("Housing") upon the premises legally described in Attachment"A" hereto (the
"Property") and preserve such Housing as Affordable for Low-Income Families with the
assistance of HOME CHDO Funds while meeting the Affordable Housing, income
targeting and other requirements of 24 CFR 92.254 for the fifteen (15) year Affordability
Period according to the terms and conditions of the Agreement.
B. The Agreement or a memorandum of it was recorded [ , 200_x, as
Instrument No. f 1 in the Official Records of Fresno County, California.
C. Under the terms of the Agreement, after SHE completes the construction on the
Housing or a phase thereof, SHE may ask City to record a Certificate of Completion.
D. SHE has asked City to furnish SHE with a recordable Certificate of Completion.
E. The City's issuance of this Certificate of Completion is conclusive evidence that
SHE has completed the construction of the Homes/ phase Homes) on the
Property as set forth in the Agreement.
NOW THEREFORE:
1. City certifies that SHE has completed the construction work on of
the Homes/ phase Homes), and has done so in full compliance with the
Agreement. 11
2. This Certificate of Completion is not evidence of SHE's compliance with,
or satisfaction of, any obligation to any mortgage holder, or any mortgage insurer,
securing money lent to finance work on the Property, or any part of the Property or
Project. Nothing contained herein modifies any provision of the Agreement.
3. This Certificate of Completion is not a notice of completion as referred to
in California Civil Code section 3093.
1H
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IN WITNESS WHEREOF, City has executed this Certificate of Completion as of this
r,
day of , 200
CITY OF FRESNO
By:
(Authorized Agent)
SHE, a California non-profit public benefit corporation, the Owner of record of the
Property, consents to recording this Certificate of Completion against the Property
described herein.
Dated: Dated:
By: By:
Thomas J. Collishaw, Carol A. Glass
Assistant Secretary Assistant Secretary
THE ABOVE PARTIES ARE TO SIGN THIS INSTRUMENT BEFORE A NOTARY
PUBLIC.
ATTEST: APPROVED AS TO FORM:
CITY CLERK CITY ATTORNEY
By: By:
Deputy Assistant/Deputy
Dated: Dated:
a' 49
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EXHIBIT D: DECLARATION OF RESTRICTIONS
Recording Requested By:
When Recorded Return to:
SELF HELP ENTERPRISES, INC.
P. O. Box 351
Visalia, CA 93279-0351
(SPACE ABOVE THIS LINE FOR RECORDER'S USE ONLY)
DECLARATION OF RESTRICTIONS
THIS DECLARATION OF RESTRICTIONS, ("Declaration"), is executed as of
this [ J, by Self Help Enterprises, Inc., a California nonprofit public
benefit corporation, ("Declarant") in favor of the City of Fresno, acting by and through
its Planning and Development Department, Housing and Community Development
Division, ("City").
WHEREAS, Declarant is the owner of the real estate in the county of Fresno,
state of California, consisting of APN 481-110-26, which is more particularly described
in Exhibit "A", attached hereto and made a part hereof(the "Property"); and
WHEREAS, Declarant and City are concurrently with the execution herewith
entering into a certain HOME Investment Partnerships Program Agreement dated June
10, 2004, incorporated herein, ("HOME Agreement"), whereby Declarant agrees to
utilize and City agrees to provide certain HOME CHDO Funds from the United States
Department of Housing and Urban Development to Declarant for certain affordable
housing new construction (the "Project") upon the Property and subsequent sale to low
income families, subject to the terms and conditions set forth in the HOME Agreement;
and
WHEREAS, the HOME Program regulations promulgated by HUD, including
without limitation 24 CFR Section 92.254, impose certain affordability requirements
upon property benefitted by HOME program funds, which affordability restrictions must
be enforceable for a fifteen 15 year period; and
WHEREAS, these restrictions are intended to bind all purchasers and their
successors. .
NOW THEREFORE, Declarant declares that the Project Homes upon the
Property are held and will be held, transferred, encumbered, used, sold, conveyed and
occupied subject to the covenants, restrictions, and limitations set forth in this
Declaration, all of which are declared and agreed to be in furtherance of the plan for the
construction, sale and occupancy of the Homes upon the Property. All of the
r
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restrictions, covenants and limitations will run with the land and will be binding on all
parties having or acquiring any right, title or interest in the Project Homes upon the
Property or any part thereof, will inure to the benefit of the future Owners of the Homes
or any part thereof, the United States and the City, and will be enforceable by any of
them. Any purchaser under a contract of sale covering any right, title or interest in any
part of the Project Homes upon the Property, by accepting a deed or a contract of sale
or agreement of purchase, accepts the document subject to, and agrees to be bound
by, any and all restrictions, covenant, and limitations set forth in this.Declaration for the
period of fifteen (15) years constituting the Affordability Period.
1. Declarations. Declarant hereby declares that the Homes upon the Property are
and shall be subject to the covenants and restrictions hereinafter set forth, all of which
are declared to be in furtherance of the Project and the HOME Agreement Project, and
are established and agreed upon for the purpose of enhancing and protecting the value
of the Project Property and in consideration for City entering into the HOME Agreement
with Declarant. All terms not otherwise defined herein shall have the meaning ascribed
to such term in the HOME Agreement.
2. Restrictions. The following covenants and restrictions on the use and enjoyment
of the Project Homes upon the Property shall be in addition to any other covenants and
restrictions affecting the Project Property, and all such covenants and restrictions are
for the benefit and protection of City, and shall run with the Homes upon the Property
and be binding on any future owner's of the Project Homes upon the Property and inure
to the benefit of and be enforceable by City. These covenants and restrictions are as
follows:
a: Declarant for itself and its successor(s)on title covenants and agrees
that from the Project Completion Date(s) until the expiration of the Affordability Period it
shall cause the Project Homes upon the Property to be used for Affordable Housing.
Declarant further agrees to file a recordable document setting forth the Project
Completion Date(s) and the Affordability Period when determined by the City. Unless
otherwise provided in the HOME Agreement, the term Affordable Housing shall include
without limitation compliance with the following requirements:
Nondiscrimination. There shall be no discrimination against nor
segregation of any person or group of persons on account of race, color, creed,
religion, sex, marital status, national origin, ancestry, or handicap in the sale, transfer, .
use, occupancy, tenure, or enjoyment of any of the Project Property, nor shall Declarant
or any person claiming under the Declarant, establish or permit any practice of
discrimination or segregation with reference to the selection, location, number, use or
occupancy of owners or vendees of the Project Property.
Principal Residence. Each Home constituting the Project upon the
Property shall be sold only to natural persons, who shall occupy the home as the
purchaser's principal residence. The foregoing requirement that the purchaser of each
F Home constituting the Project Property occupy the home as the purchaser's principal
residence does not apply to: (1) Declarant; (ii) persons, other than natural persons, who
1
f
acquire the Project Property or portion thereof by foreclosure or deed in lieu of
foreclosure; or(iii) HUD qualified entities that acquire the Project Property or portion
thereof, with the consent of the City.
Homeowner Income Requirements. The Homes constituting the Project
upon the Property and each of them may be conveyed only to (a) natural person(s)
whose annual household income at the time is not greater than eighty percent (80%) of
the most recent annual median income calculated and-published by HUD for the Fresno
Metropolitan Statistical Area applicable to such household's size, and at an affordable
price which allows monthly housing payments (principal, interest, taxes and insurance)
of not more than thirty percent(30%)of the household's gross income.
Resale and Recapture. Should the Homes constituting the Project upon
the Property and each of them not continue to be the principal residence of the family
for the duration of the period of affordability, such Home(s) shall be made available for
subsequent purchase only to a buyer whose family qualifies as a low-income family for
use as the family's principal residence, provided that the price at resale shall provide
the original HOME-assisted owner a fair return on investment(including the
homeowner's investment in Qualified Capital Improvements) as provided for in the
Agreement, and further provided that the Home(s) shall remain affordable to a
reasonable range of low-income home buyers. The affordability restrictions may
terminate upon occurrence.of any of the following termination events: foreclosure,
transfer in lieu of foreclosure or assignment of an FHA insured mortgage to HUD. The
City shall be possessed of a first right of refusal to purchase the Home(s) before
foreclosure to preserve affordability. The affordability restrictions shall be revived
according to the original terms if, during the original affordability period, the owner of
record before the termination event, obtains an ownership interest in the housing.
Item (a) above is hereinafter referred to as the Covenant and Restrictions.
3. Enforcement of Restrictions. Without waiver or limitation, the City shall be
entitled to injunctive or other equitable relief against any violation or attempted violation
of any Covenant and Restriction, and shall, in addition, be entitled to damages for any
injuries or losses resulting from any violations thereof.
4. Acceptance and Ratification. All present and future owners of the Project Homes
upon the Property and other persons claiming by, through, or under them shall be
subject to and shall comply with the Covenant and Restrictions. The acceptance of a
deed of conveyance to the Project Property shall constitute an agreement that the
Covenant and Restrictions, as may be amended or supplemented from time to time, are
accepted and ratified by such future owners, tenant or occupant, and such Covenant
and Restriction shall be a covenant running with the land and shall bind any person
having at any time any interest or estate in the Project Property, all as though such
Covenant and Restriction was recited and stipulated at length in each and every deed,
conveyance, mortgage or lease thereof.
Notwithstanding the foregoing, upon foreclosure by a lender or other transfer in
lieu of foreclosure, or assignment of an FHA-insured mortgage to HUD, the Affordability
x. Period shall be terminated if the foreclosure or other transfer in lieu of foreclosure or
assignment recognizes any contractual or legal rights of public agencies, nonprofit
sponsors, or others to take actions that would avoid the termination of low-income
affordability. However, the requirements with respect to Affordable Housing shall be
revived according to their original terms, if during the original Affordability Period, the
owner of record before the foreclosure or other transfer, or any entity that includes the
former owner or those with whom the former owner has or had formerly, family or
business ties, obtains an ownership interest in the Project or the Property, the
Affordability Period shall be revived according to its original terms.
5. Benefit. This Declaration shall run with and bind the Project Homes upon the
Property for a term commencing on the date this Declaration is recorded in the Office of
the Recorder of the county Fresno, state of California, and expiring upon the expiration
of the Affordability Period. The failure or delay at any time of City or any other person
entitled to enforce this Declaration shall in no event be deemed a waiver of the same,
or of the right to enforce the same at any time or from time to time thereafter, or an
estoppel against the enforcement thereof.
6. Costs and Attorney's Fees. In any proceeding arising because of failure of
Declarant or any future owner of the Project Homes upon the Property to comply with
the Covenant and Restrictions required by this Declaration, as may be amended from
time to time, City shall be entitled to recover its-costs and reasonable attorney's fees
incurred in connection with such default or failure.
7. Waiver. Neither Declarant nor any future owner of the Project Homes upon the
Property may exempt itself from liability for failure to comply with the Covenant and
Restrictions required in this Declaration.
8. Severability. The invalidity of the Covenant and Restrictions or any other
covenant, restriction, condition, limitation, or other provision of this Declaration shall not
impair or affect in any manner the validity, enforceability, or effect of the rest of this
Declaration and each shall be enforceable to the greatest extent permitted by law.
9. Pronouns. Any reference to the masculine, feminine, or neuter gender herein
shall, unless the context clearly requires the contrary, be deemed to refer to and include
all genders. Words in the singular shall include and refer to the plural, and vice versa,•
as appropriate.
10. Interpretation. The captions and titles of the various articles, sections,
subsections, paragraphs, and subparagraphs of this Declaration are inserted herein for
ease and convenience of reference only and shall not be used as an aid in interpreting
or construing this Declaration or any provision hereof.
11. Amendment. No amendment or modification of this Declaration shall be permitted
without the prior written consent of City. '
12. Recordation. Declarant acknowledges that this Declaration will be filed of record
in the Office of the Recorder of county of Fresno, State of California.
r 13. Capitalized Terms. All capitalized terms used in this Declaration, unless
otherwise defined herein, shall have the meanings assigned to such terms in that
certain HOME Agreement by and between Declarant and City, of even date.
14. Headings. The headings of the articles, sections, and paragraphs used in this
Agreement are for convenience only and shall not be read or construed to affect the
meaning or construction of any provision.
IN WITNESS WHEREOF, Declarant has executed this Declaration of
Restrictions on the date first written above.
"DECLARANT"
By:
THOMAS J. COLLISHAW
Assistant Secretary
Date:
By:
CAROL A. GLASS
Assistant Secretary
Date:
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EXHIBIT E - SCHEDULE OF PERFORMANCE
PROPOSED PROJECT SCHEDULE
O C E
Tentative Map, Rezone .................................... June, 2004
Improvement Plans Complete .......................... June, 2005
Site Acquisition..........................................December, 2003
Bid Plans............................................................June, 2004
Begin Subdivision Improvements ............September, 2004
Begin Recruiting Families...................................June, 2004
Complete Subdivision Improvements... .. ..December, 2004
Start First Group of Ten Houses................... January, 2005
Complete First Group of Ten Houses........September, 2005
Start Second group of Ten Houses...................March, 2005
Complete Second Group of Ten House.....December, 2005
Start Third Group of Ten Houses........................June, 2005
Complete Third Group of Ten Houses...............March, 2006
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EXHIBIT F- PAYMENTS AND PAYMENT SCHEDULE
A. PAYMENTS BY CITY
Under the Agreement City has allocated, and City shall not hereunder be
liable or responsible beyond, HOME funding for eligible costs not to exceed a total of
One Million Two Hundred Thousand Dollars ($1,200,000.00), which funding shall be
used by and payable to Self Help Enterprises (SHE) as follows:
1. If HOME CHDO funds are used to reimburse for construction purposes the
following 10% retention provision shall apply:
Within 30 days of receipt and approval of each request for payment from SHE,
not to exceed the sum of Three Hundred Sixty Thousand ($360,000.00)for each Phase
[total for Project not to exceed One Million Eighty Thousand Dollars ($1,080,000.00)],
City shall pay no more frequently than monthly for eligible Project costs due and
payable from City, provided that City shall verify, audit and in its reasonable discretion
approve all such payments, and further, provided that City shall deduct prior to Project
disbursements by City and Eligible Project costs incurred by City if any.
At the discretion of the City, within thirty(30) days of recordation of Certificate
of Completion per phase or for the entire project(i.e. all 30 Project Homes), the 10%
retention payment shall be made for eligible Project costs due and payable from City,
not to exceed the sum of Forty Thousand Dollars ($40,000.00)for each Phase [total for
Project not to exceed One Hundred Twenty Thousand Dollars ($120,000.00)], provided
that City shall deduct prior Project disbursements by City and Eligible Project costs
incurred by City if any, and further provided that the retention shall be released only
upon expiration of time to file statutory liens/claims with no such liens/claims being filed.
2. If HOME CHDO funds are used to reimburse for non-construction
purposes the following "no retention" provision shall apply:
Within 30 days of receipt and approval of each request for payment from SHE,
not to exceed the sum of Four Hundred Thousand ($400,000.00)for each Phase [total
for Project not to exceed One Million Two Hundred Thousand Dollars ($1,200,000.00).]
City shall pay no more frequently than monthly for eligible Project costs due and
payable from City, provided that City shall verify, audit and in its reasonable discretion
approve all such payments, and further, provided that City shall deduct prior to Project
disbursements by City and Eligible Project costs incurred by City if any.
Reimbursement Process:
SHE shall submit requests for reimbursement of eligible costs on a monthly
basis to:
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City of Fresno
Planning and Development Department -
' Housing and Community Development Division
Att: Housing` and Community Development Manager
2600 Fresno Street, Room 3076
Fresno, CA 93721-3605
SHE shall utilize the request for payment for provided by City. Requests for
payment shall be signed and certified by SHE's authorized agent and shall include at
least the following:
1. A description of the Eligible work performed, material supplied and/or costs
incurred
for which disbursement is requested.
2. The total amount of Eligible cost reimbursement due SHE and
substantiation therefore including invoices from vendors, suppliers, contractors,
subcontractors for each requested item less prior Project disbursements by City and
Project costs incurred by City if any.
3. Each request for payment shall certify, represent and warrant that SHE is
in compliance with all the conditions precedent to a disbursement as specified in the
Agreement and this Exhibit F, upon which City may rely in making payment to SHE.
Additional Conditions to Reimbursement:
In addition to City's rights and remedies in the Agreement, City shall have the
right to condition any reimbursement upon receipt and approval of the following:
1. Bills, invoices, documents of title, vouchers, statements, receipts, closing
statements and any documents evidencing the total amount of Eligible Costsdsubject
reimbursement.
2. Evidence of SHE's use of a unconditional final lien release,join check and
voucher system acceptable to City for payments or disbursements to any contractor,, ,
subcontractor, material man, supplier or lien claimant.
3. Citybinspector periodic certifications of the stage of construction that has
been completed and its conformance to the Plans and Specifications and governmental
requirements based upon any such inspector's physical inspections of the Property and
Improvements.
4. Unconditional final waivers, releases, bonding, insuring against and/or
' collateralizing against any mechanics' lien, stop notice claim, equitable lien claim or
other liens.
5. Valid, recorded or claim of right.or interest in the Property and
Improvements.
6. Valid, statutory Notice of Completion (not be confused with the Project's
construction Certificate of Completion) recorded under applicable law.
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EXHIBIT "G" - PROMISSORY NOTE
NOT TO EXCEED $600,000.00 12004
PROMISSORY NOTE SECURED BY DEED OF TRUST
On the Maturity Date specified below, for value received, the undersigned, SELF HELP
ENTERPRISES, Inc., a California nonprofit public benefit corporation, (A Borrower),
promises to pay to the order of the CITY OF FRESNO, a municipal corporation, (A
Lender), the sum of Six Hundred Thousand Dollars($600,000.00) to the extent of value
received, with interest thereon at the rate of zero percent(0%) per annum from the date
of this instrument until maturity with attorney's fees and costs of collection, and without
relief from valuation and appraisement laws.
All capitalized terms used in this Note, unless otherwise defined, will have the
respective meanings specified in the Home Investment Partnerships Program
Community Housing Development Organization Agreement("Agreement") entered into
June 10, 2004, by and between the Lender and Borrower. In addition, as used in this
Note, the following terms will have the following meanings:
Business Day means any day other than Saturday, Sunday, or public holiday or
the equivalent for banks generally under the laws of California. Whenever any
payment to be made under this Note is stated to be due on a day other than a
Business Day, that payment may be made on the next succeeding Business
Day. However, if the extension would cause the payment to be made in a new
calendar month, that payment will be made on the next preceding Business Day.
Maturity Date means the June 10, 2006 date upon Borrower has agreed to
complete all sale of all Homes as affordable owner occupied housing for low
income persons.
This Note, and any extensions or renewals hereof, is secured by a standard form
Deed of Trust on real estate in Fresno County, California, that provides for acceleration
upon stated events, dated'as of the same date as this Note, and executed by Borrower
as trustor, naming Fidelity National Title Company as trustee, and issued in favor of and
delivered to the Lender, (A Deed of Trust), insured as a no worse than (4`h) position lien
subject to subordination upon written consent of Lender.
The entire balance of principal, costs, fees or other charges shall be due on the
Maturity Date. All payments collected shall be applied first to payment of any costs,
fees or other charges due under this Note and then to the principal balance.
Time is of the essence. It will be a default under this Note if Borrower defaults
under the Agreement including all documents and instruments referenced therein,
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and if Borrower fails to pay when due any sum payable under this Note. On the
occurrence of a default under this Note or on the occurrence of any other event that
under the terms of the Agreement including all documents and instruments
referenced therein gives rise to the right to accelerate the balance of the
indebtedness, then, at the option of Lender, this Note or any notes or other
instruments that may be taken in renewal or extension of all or any part of the
indebtedness will immediately become due without any further presentment,
demand, protest, or notice of any kind.
The principal amount of the indebtedness evidenced by this Note may, at the option
of the Borrower, be prepaid in whole or in part without penalty. All loan payments
are payable in lawful money of the Unitech States of America at any place that
Lender or the legal holders of this Note may, from time to time, in writing designate,
and in the absence of that designation, then to Lender at 2600 Fresno Street, Room
3076, Fresno, CA 93721-3605.
Borrower agrees to pay all costs including, without limitation, attorney fees, incurred
by the holder of this Note in enforcing payment, whether or not suit is filed, and
including, without limitation, all costs, attorney fees, and expenses incurred by the
holder of this Note in connection with any bankruptcy, reorganization, arrangement,
or other similar proceedings involving the undersigned that in any way affects the
exercise by the holder of this Note of its rights and remedies under this Note. All
costs incurred by the holder of this Note in any action undertaken to obtain relief
from the stay of bankruptcy statutes are specifically included in those costs and
expenses to be paid by Borrower. Borrower will pay to Lender all attorney fees and
other costs referred to in this paragraph on demand.
Any notice, demand, or request relating to any matter set forth herein shall be in
writing and shall be given as provided in the Agreement including all documents and
instruments referenced therein.
No delay or omission of Lender in exercisong any right or power arising in connection
with any default will be construed as a waiver or as an acquiescence, nor will any
single or partial exercise preclude any further exercise. Lender may waive any of
the conditions in this Note and no waiver will be deemed to be a waiver of Lender's
rights under this Note, but rather will be deemed to have been made in pursuance of
this Note and not in modification. No waiver of any default will be construed to be a
waiver of or acquiescence in or consent to any preceding or subsequent default.
The Deed of Trust provides as follows:
DUE ON SALECONSENT BY BENEFICIARY. Beneficiary may, at its option,
declare immediately due and payable all sums secured by this Deed of Trust
upon the sale or transfer, without the Beneficiary's prior written consent
where such consent is required under the Agreement, of all or any part of the
Property or any interest in the Property, provided a sale to a Home buyer as
Affordable Housing as provided in the Agreement shall not be a A sale or
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transfer for purposes of this paragraph. Subject to the foregoing, a A sale or
transfer means the conveyance of Property or any right, title or interest
therein; whether legal, beneficial or equitable; whether voluntary or
involuntary; whether by outright sale, deed, installment sale contract, land
contract, contract for deed, leasehold interest with a term greater than three
(3) years, lease-option contract, or by sale, assignment, or transfer of any
beneficial interest in or to any land trust holding title to the Property, or by any
other method of conveyance of Property interest. If any Trustor is a
corporation, partnership or limited liability, company, transfer also includes
any change in ownership of more than twenty-five percent (25%) of the voting
stock, partnership interests or limited liability company interests, as the case
may be, of Trustor. However, this option shall not be exercised by
Beneficiary if such exercise is prohibited by applicable law.
Lender may transfer this Note and deliver to the transferee all or any part of the
Property then held by it as security under this Note, and the transferee will then
become vested with all the powers and rights given to Lender; and Lender will then
be forever relieved from any liability or responsibility in the matter, but Lender will
retain all rights and powers given by this Note with respect to Property not
transferred. Borrower may assign its obligations under this Note pro rata to Project
Home buyers upon Home buyers assumption thereof and the written consent of
Lender.
If any one or more of the provisions in this Note is held to be invalid, illegal, or
unenforceable in any respect by a court of competent jurisdiction, the validity,
legality, and enforceability of the remaining provisions will not in any way be affected
or impaired. This Note will be binding on and inure to the benefit of Borrower,
Lender, and their respective successors and assigns.
Borrower agrees that this Note will be deemed to have been made under and will be
governed by the laws of California in all respects, including matters of construction,
validity, and performance, and that none of its terms or provisions may be waived,
altered, modified, or amended except as Lender may consent to in a writing duly
signed by Lender or its authorized agents.
In witness whereof, Borrower has caused this Promissory Note to be executed by its
authorized agent as of the date and year first above written.
BORROWER:
Self Help Enterprises Inc., a California nonprofit public benefit corporation.
By: By:
THOMAS J. COLLISHAW CAROL A. GLASS
Assistant Secretary Assistant Secretary
SHE AS TRUSTOR; CITY AS BENEFICIARY