Loading...
HomeMy WebLinkAboutFresno Revitalization Corp Canyon CrestNOMW REPORT TO THE REDEVELOPMENT AGENCY BOARD DATE: April 8, 2010 REMN0. V30P *z'D COUNCIL MEETING: 48/10 nw wo BY or DiREcroa FROM: MARLENE MURPHEY, Executive Director Wr//dw.r- W BY: JOHN RAYMOND Assistant Executive Director SUBJECT:Approve agreements with the Fresno Revitalization Corporation, Inc a California Non -Profit Corporation and the Non -Prof an of the Agency, for the Acquisition and Rehabilitation of a 118unit Apartment Complex at 3033 E Plan Avsnue. EXECUTIVE SUMMARY Redevelopment Agency Staff recommend Nal the Agency Board approve the attached Agreements bobveen the Redevelcpmanl Agency of the City of Fresno and the Fresno Revitalization Corporation, Inc., a California Non -Prof Corporation and the non-profit arm of the Agency, tar the eoquisibon, operation, and maintenance of a 118 -unit apartment complex located at 3033 East Plan Avenue in Fresno, near Merged Redevelcpmenl Project Area Na 1. These agreements would allow the FRC to accept and avrerd of $2,772,253 in Neighborhood Stabilization Program (-NSP') set-aside turas from the City of Fresno, pursuant to the Housing and Economic Recovery Ad of 2008. NSP is a subcomponent of the Community Development Block Grant Program (CDBG) and administered by HUD. The intent of NSP is to stabilize neighborhoods thmugh the acquisition of foreclosed and abandoned houses to arrest the dedine in local neighborhoods caused by the national foreclosure crisis. On March 4, 2010, the City Council approved an NSP substantial amendment authomang, among other actions, the award of $2,772,253 of NSP sat aside funds to the FRC to acquire and rehabilitate the 118 -unit muWamily complex As required by HUD, at least twenty. five percent ($2,772,253) a the total NSP funds received by the City of Fresno are sat -aside for projects that address the housing needs of very low-income persons. With the creation of affordability coverents on at least 80% of nre units at the property, this project helps Ite City meat that requirement. BACKGROUND The subject property, called the Canyon Crest Cociominiums, is currently owned by Inland Mortgage Capital Corporation (°IMCC') of Chicago as the result of a foreGosure of ma previous owner. Located at 3033 East Plan Avenue, Fresno, CA 93721 (near the sout1mvest tamer of First And Tulare), it is a 118 unit apartment complex, approximately 90% oeapieci, listed for sale W a purchase pnca of $4,995,000. The Agency pursued the subject property as a candidata for the NSP low income and mufti - family obligation for the following reasons a) them is a limited inventory of foreclosed muiti- family properties currently on the market for sale; b) this project will satisfy the NSP 25% set REPORT TO THE REDEVEIAPMENT AGENCY BOARD Operating Agreement -Fresno RevBeMredon Corporation, Inc. ADM 8.2010 Page 2 aside in a single action (rather than numerous smaller multi -family properties); c) the project is 90% asset with on-site management already in place; d) the lender's willingness to may financing for the balance of the purchase price; e) a very quick dosing to meet Me NSP's tight timing constraints; and, i) the anticipated per unit acquisition Cost of $39,831 makes it very attractive, espedally when income restrictions are placed upon to units. The subject property, given its overall condition and occupancy levels, is an ideal Candidate for the City of Fresno's Neighborhood Stabilization Program and will meet the NSP deadlines in late summer, 2010. Working with the City Manager an Mayor's offices, the Agency submitted an offer to purchase the property on February 18, 2010, at a purchase price of $4,700,000, sublets to appraisal, Agency Board approval and federal NSP guidelines requiring an acquisition Mrough foreclosure to occur a a Price not to exceed 99% of the appraised value. On February 19, 2010, the Agency received acceptance of its proposed terms subject to mina refinements. As Me Agency worked through the deal polms wiM the seller and the City, it was determined that greater flexibility in Bre use of funs generated by the property for improvements to the property would be achieved from a structure in which Fresno Revitalization Corporation - Mat qualifies as an NSP-dwined developer - holds title to Use property. The City an Seller approved this structure in which the FRC holds title to the property with the Agency serving as Ura Guarantor of the Sellers loan an Max Operator/Manager of the property through a series of agreements. The Agency will operate and manage the property in accordance with the Operating and Contractual Services Agreements YAM Me FRC. The final appraisal values Me property in -as is' conirm as $4,500,000. The "as is" appraisal takes into consideration approximately $230,000 for required repairs. Based upon Met value, adjusted by NSP appraisal guidelines (purchase Prim must not exceed 99% of appraised value), staff offered a purchase price of $4,445,000 ($4,500,000 x .99 = $4,445,000). Based upon immediate deferred maintenance of $37,000, an additional adjustment was made for an Adjusted Purchase Prim of $841,000. The Adjusted Purchase Prim would be payable with $2,480,204 in rash from Me NSP Loan proceeds with the Seller carrying Me balance of $1,07.7%, as a first trust deed loan, bearing interest at the rate of 6.35% per annum, for a period not to exceed 30 mortis. The difference between the $2,772,253 in total rash available (awarded by the City Council M the FRC on March 4, 2010) and Me proposed $2,480,204 Cash down peymert ($2,772,253 - $2,480,204 = $292,049) will be used for unit repairs anfor dosing Costs and maintenance items. In terms of the agreements between the Agency an FRC, the parties shall enter an Operating Agreement which contains the requirements to acquire, renovate and maintain the Property, under which the Agency shall provide FRC a Loan Guarantee of the Sellers Note from IMCC to assist FRC's acquisition of the Property in an amount not to exceed Two Million Dollars ($2,000,000) (Me 'Agency Guarantee) upon Me tarms and conditions specified in Me Loan Guarantee. The Agancy shall also provide administrative, firancial an technical support to the FRC in Me acquisition an operation of the Property through the Contractual Services Agreement. REPORT TO THE REDEVELOPMENT AGENCY BOARD placating Agreement -Frasio RevlleAzatlon Comoation, Inc. ApN a, 2010 Pepe 3 The Operating Agreement between the Agency and FRC is similar to a development agreement YAM a private entity, whereby the Agency provides some fans of project assistance (in this case, a Loan Guarantee) and in realm for the assistance the Owner undertakes actions to compless the project. Tha second agreement, the Cantradu ll Services Agreement, is where the FRC 'hires back" the Agency to undertake all or most of the tasks the Agency has required of the FRC under the Operating Agreemem. This structure separates the operating and contractual services agreements into two documents and would allow the ongoing operational obligations required through the Regulatory Agreement (exhibit to operating agreement) to slay in place upon the resale 0 the Property without having to redraft that agreement- e,g. affordability covenants, maintenance standards, nondiscrimination request. The agreement also contains a Regulatory Agreement cresting the affordability covenants and long -tern maintenance and operating restrictions which shall be recorded against and lour with the Property. Under this terms of the NSP Agreement with the City of Fresno, at least 60% of ghe units shall be reserved for households of 50% of Area Median Income ('AMI') or below under the Federal NSP guidelines, which would be 71 units. Additionally, to meet the public purpose undedying the non- profit status of the FRC and the Housing Set -Aside requirements of the Agency (as a consequence of its loan guarantee), the remaining unds net of the manager's unit (an additional 40% of the units (A6 units) shall be restricted to housefwlds of 606 of AMI or below This is the standard for lower-income rents under Caiffomla Redevelopment Law; 50% of AMI is considered .very low income' rent. All of hire units will be caroted toward the Agency's obligations to create a' maintain affordable housing in Fresno. Two proforma projections are described below: Projection 1 assumptions are: (1) the ane -bedroom units are rented at $525 par month; (2) the two bedroom units are rented at $GA per month; and, 3) that the vacancy/collection loss amounts to 10%, staff has estimated the net operating income at approximately $332,375 per year. Assuming annual debt service of $123,050.0.5 ($1,937796 x 0635), the debt service coverage ratio (DSCR) equates to a significant 2.7. The DSCR is the primary measure to determine If a property will be able to sustain its debt based an rash flow. In this case, the project has 2.7 dollars available in cash flow for every dollar needed for debt servico. Commercial banks typically require a DSCR of only 1.15 -1.35; even in the current conservative lending dimale DSCRs are still typically less than 1.5; consequently, a DSCR of 2.7 is eWeardinamy conservative. Projection 2 assumptions are: (1) the one-bedraan units are rented at $510 and the two- bedroom units are rented at $575 per month; (2) the va®rwy/collection loss amounts to 10%; and, (3) the operating expenses are approximately 13% higher than projected, staff has REPORT TO THE REDEVELOPMENT AGENCY BOARD Opna MAmeement-Fresno Renlelindan Corporalbn. Inc. Aqp e, 3010 Pape 4 estimated! the net operating Income at approximately $247,740 per year. Assuming the same annual debt service of $123,05005 ($1,937,796 x 0635), the debt service coverage ratio (DSCR) equates to 2.01. Under this scenario, the project hes 2.01 dollars available in cash flow for every dollar of debt service - still highly extraoNinary for a project of this type. Far the project to reach a "brwkaven' point at which debt service payments could be made but whitll there is no positive cash flux, 22 units would have to remain empty for an entire year, lowering the current occupancy rete from approximately 90% to about 71 %, a significant dropoR in occupancy considering the current good condition of the project, its location near dovnlown and the Community Regional Medical Center, and the $292,000 in additional property upgrades that the RDA on behalf of the FRC xould undertake on Me Property. In addition, those conservative scenarios project a very low— and hence competitive — rant structure. The Project has been environmentally assessed (Environmental Assessment No. H-2010-10) and cues determinetl to be celegaically excluded from review under Secgon 5835 (a) (3) (ii) and (a) (5) &the National Environmental Policy Act (NEPA) Guidelines. Additionally, the Pmjed has been assessed under the California Environmental Quality Act (CEQA), resulting in a Categorical Exemption. Based an the review, City stag detelmirred that the Project is consistent with all oT the criteria speci(red fa an exemption to the California Environmental Quality Act (CEGA) in accordance with Section 15301 /Class 1 and 15376(b)(4) of the CEQA Guidelies. The FRC Board approved the acceptance of the NSP Award in the amount of $2,772,253 from the City of Fresno. Addessa ly, Me Operating Agreement, and the Contractual Services Agreement were approved by the FRC Board at a special meeting held on March 18, 2010 subject to the City Attorney's review of Mose document s. Attachments: 1. Area Map 2. Draft Operating Agreement 3. Draft Contractual Services Agreement FLar MAP go !s 0 u VON rxu. tl �� Lj gil!• ' n E This Agreement Is remNed at the request and for the beneft W the City or Fresno and Is exemlet hom the payment ora reroNing lea pursuant to Gwemment Code section 6103. pr Rudd Assistant City Manager Date: .f2Y//a ClT OF FRESNO NEIGHBORHOOD STABILIZATION PROGRAM AGREEMENT by and be (amen CITY OF FRESNO, a municipal preparation and FRESNO REVITALIZATION CORPORATION a nonprofit public benefit corporation regarding "Canyon Crest Apartments" APN: 468-390-44s An Affordable Mulb-Family Apartment Project r ter• Recorded at the Request of and When Recorded Return to: City of Fresno Planning and Development Department Housing and Community Development ig Division a _ Attention: Housing Manager " 2600 Fresno Street, Room 3070 Fresno, CA 93721-3605 This Agreement Is remNed at the request and for the beneft W the City or Fresno and Is exemlet hom the payment ora reroNing lea pursuant to Gwemment Code section 6103. pr Rudd Assistant City Manager Date: .f2Y//a ClT OF FRESNO NEIGHBORHOOD STABILIZATION PROGRAM AGREEMENT by and be (amen CITY OF FRESNO, a municipal preparation and FRESNO REVITALIZATION CORPORATION a nonprofit public benefit corporation regarding "Canyon Crest Apartments" APN: 468-390-44s An Affordable Mulb-Family Apartment Project r ter• AGREEMENT BETWEEN THE FRESNO REVITALIZATION CORPORATION AND THE CITY OF FRESNO REGARDING THE ACQUISITION OF 118 MULTI-FAMILY HOUSING UNITS THIS AGREEMENT is made and entered Into, effective the 4th day of March 2010, by and between the CITY OF FRESNO, California, a municipal corporation, hereinafter referred to as Me "City", and the Fresno Revitalization Corporation of the City of Fresno, a nonprofit public benefit corporation, hereinafter referred to as the 'DEVELOPER". RECITALS WHEREAS, the U.S. Department of Housing and Uman Development, hereinafter referred M as "HUD", provides funding under Its Neighborhood Stabilization Program, hereinafter "NSP" as authorized! under Title III of Division B of the Housing and Economic Recovery Act of 2008, for the purpose of assisting in the redevelopment of abandoned and foreclosed homes under the Emergency Assistance far Redevelopment of Abandoned and Foreclosed Homes heading. hereinafter referred to as the "Act", incorporated herein by its reference; and WHEREAS, City Is a recipient of NSP funding under the Act for use in funding eligible activities furthering established national objectives to benefit Its low, moderate and middle income residents as defined in the Act; and WHEREAS, the NSP requires no less than twenty, five percent (25%) of Me CITY's NSP sternal be used for the benefit of households that earn not more than fifty percent (50%) of Me area median Income, by family size; and WHEREAS, to advance the supply of Affordable Housing within the City of Fresno, the CITY desires, among other things, M encourage privateinvestment in the affordable rental housing market; and WHEREAS, the City in accordance w@M1 its 2006-2010 Consolidated Plan and Annual Action Plan, as amended, desires to provide NSP funds in Me amount of Two Million Seven Hundred Seventy Two Thousand Two Hundred Fifty-Three Dollars ($2,]]2,253) to the DEVELOPER, as more fully described in Exhibit A, Project Description, upon the terns and conditions In this Agreement; and WHEREAS, to furtM1er its goal to Increase the supply of Affordable Rental Housing within the City of Fresno, Me CITY desires to assist DEVELOPER by providing 'a Two Million Seven Hundred Seventy Two Thousand Two Hundred FHty-Three Dollars ($2,]]2,253) deterred payment, zero interest Loan to the Project (hereinafter referred to as "Loan'), for a term of fifty-five (55) years, for payment of NSP eligible Project casts, as further identified in Exhibit C (Project Budget and Cash Flow Statement), variously to be secured by the underlying real property and the Affordable Rental Housing covenants, upon the terms and conditions in this Agreement, for the acquisition of a foreclosed 118 -unit multi -family rental housing project, located at 3033 E. Platt Avenue, Fresno, CA 93721. The Loan will be due and payable at Me earlier of fifty five (55) years from Me City issued Certificate of Completion or the date upon which he DEVELOPER has completed payment on other property acquisition lien(s); and WHEREAS, the City has determined that this Agreement is In he best Interests of, and will materially contributes to, the Housing Element of the General Plan. Further, the CITY has found that he Project (i) will have a positive influence in the neighborhood and surrounding environs, (ii) is in Me vital and best interests of he CITY, and he health, safety, and welfare of City residents, (iii) complies win applicable federal, state, and local laws and requirements, including NSP guidelines and NSP national objectives IN) will increase, improve, and preserve Me community's supply of Low, Moderate and Middle Income Housing available at affordable housing cost to persdns and families of Low, Moderate and Middle Income, as defined hereunder, (v) planning and administrative expenses incurred in sursud hereof are necessary for the production, improvement, or preservation of Low, Moderate and Middle Income Housing, and (vi) will comply with any and all owner participation rules and criteria applicable thereto; and WHEREAS, the CITY and DEVELOPER have determined Mat the NSP Assisted Units constitutes accord programmatio'grantse lender activities utilizing available and allocated program/grantee funding, outside the reach of California Consfitution Article RRXIV and enabling legislation; and WHEREAS, on February 24, 2010, Me Housing and Community Development Commission of the City of Fresno reviewed this Agreement and recommended approval', and WHEREAS, pursuant to City Resolution No. 2009-153, the City Manager is authorized to execute, on behalf of the City, NSP agreements that are within available allocated NSP funding and in a standard forth approved by the City AtMmey; and WHEREAS, on March 4, 2010, he Fresno City Council provided project approval AGREEMENT NOW, THEREFORE, in consideration of he above recitals, which recitals am contactual in nature, he mutual covenants herein contained and such other and further consideration as is hereby acknowledged, and subject to the terms and conditions and provisions hereof, Me parties agree as follows: 1. Definitions. The following. terms have Me meaning and content set forth in this Article wherever used In this Agreement, attached exhibits or attachments that are incorporated into this Agreement by reference. A. "Acquisition' means vesting of Property in fee title to the DEVELOPER. B. 'ADA" means the Americans with Disabilities Act of 1990, as most recently amended. C. 'Affirmative Marketing" means a good faith effort to attract eligible persons of all racial, ethnic and gentler groups, in Me housing market area, to rent the proposed Affordable Rental Housing Project, as hereinafter defined. D. "Affordability Period" means the fifty-fve (55) year period commencing from the date of Issuance of the Certificate of Completion of the Project Property. E "Affordable Rental Housing' means all the rental housing units located at the Project Property, of which seventy one (71) will be NSP assisted units, each of which will be required to meet the affordability requirements of this Agreement. A total of forty-six [46] units will be required to meet Me affordability requirements of the Housing Set Aside Program. R "Budget" means the Budget, and any changes thereto, approved by the CITY's Housing and Community Development Division Manager provided the total amount of NSP Funding allocated to the Project shall not be increased without City Council approval, attached hereto as Exhibit C. G. "CeNflcate of Completion" means that certificate issued, In Me form attached as Exhibit D, to DEVELOPER by the CITY evidencing Me City -approved completion of the Project for purposes of this Agreement. H. "CFR" means the Code of Federal Regulations. I. 'Current Market Appraised Value" means the value of foreclosed upon NSP or residential property that is established through an appraisal made in conformity with the appraisal requirements of URA at 49 GFR 24.103 and completed within 60 days prior to a final offer being made for Me property by a grantee, or DEVELOPER. J. "Declaration of Restrictions" means Me Declaration of Restrictions in Me form attached hereto as Exhibit B. which shall be recorded against the Property upon Me close of escrow, fishing out the Affordable Rental Housing covenants and requirements of this Agreement which shall run with the land. K. 'Deed of Trust" means that standard, subordinate second (2n) but no worse than third (3'") position Deed of Trust (including security agreement) given by DEVELOPER as Trustor, to the CITY as beneficiary, through an escrow established by DEVELOPER with a City -approved title company, and recorded against the Property, Insured in the full amount of the Loan, and acceptable to Me City Attorney, as well as any amendments to, modifications of and restatements of said Dead of Trust. The terms of any such Deed of Trust are hereby incorporated Into this Agreement by his reference, L. "Eligible Costs" means the NSP eligible costs funded by the Loan, consistent with the Budget attached as Exhibit C. as authorized under Title III of Division 3 of the Housing and Economic Recovery Act of 2008, for be purpose of assisting in the redevelopment of abandoned and foreclosed homes under the Emergency Assistance for Redevelopment of Abandoned and Foreclosed Homes, provided, however, that costs incurred in connection with any activity that is determined to be ineligible under the Program by HUD or the CITY shall not constitute Eligible Casts. M. 'Event of Default" shall have the meaning assigned to such term under Section 36.A.1 hereunder. N. 'Family' has the same meaning given that term In 24 CFR 5.403. D. 'Foreclosed" means a property that has been foreclosed upon, and is at be point that, under state or local law, the mortgage or tax handsome is complete. P. 'Hazardous Materials" means any hazamme or toxic substances, materials, wastes, pollutants or confarnhants 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, time formaldehyde Insulation, radioactive materials, asbestos and lead Hazardous Materials do not include substances that are used or consumed in the normal course of developing, operating or ecoupying 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. D. "Household' means one or more persons occupying a Project Property. R. -HUD" means the United States Department of Housing and Urban Development S. "Loan" means the loan of NSP Funds, In the total amount not to exceed Two Million Seven Hundred Seventy Two Thousand Two Hundred Fifty-Three Dollars and 00)100 ($2,772,253) for eligible NSP costs, made available by the CIN to the Project pursuant to this Agreement, as more specifically described in Exhibit A, Project Description, and as authorized in the Exhibit C, Budget and in the Promissory Note attached hereto as Exhibit E The Loan shall be payable in accordance with the terms of the Note, and shall be secured by a Deed of Trust recorded against the property. T. "Loan Documents" are collectively his Agreement, me Note(s), Directs) of Trust, Declaration(s) of Restrictions and all related documenarinstruments as may may be amended, modified or restated from time to time along with all exhibits and attachments thereto, relative to the Loan. U. "Neighborhootl Stabilization Program Funds" (also referred to In this Agreement as "NSP Funds') means the NSP monies constituting the Loan, in an amount not to exceed the sum of Two Million Seven Hundred Seventy Two Thousand Two Hundred Fifty -Three Dollars and 00/100 ($2,]]2,253), used for NSP eligible casts. V. "Prejee means the purchase of one hundred eighteen (118) foreclosed Affordable Rental Housing Units located at 3033 E. Platt Ave., Fresno, CA 93721, of which seventy one (71) units will be leased to very low income households, all as described in due Project Description allaOed hereto and incorporated herein as Exhibit A. W. "Project Completion Dale" means the date by which the DEVELOPER has acquired the Project Property, expended NSP funds on eligible activities In accordance with this Agreement, and provided the City verification of Me very low income household status for seventy one (71) housing units in the Project The Project Completion Date for this project is August 31. 2010. X. "Preject Property" means Me abandoned and/or foreclosed property to be purchased by the DEVELOPER according to NSP guidelines, and managed as a mixed income housing project as provided herein. Y. 'Project Schedule" means Me schedule for completion of the Project mounted within the Exhibit A, Project Description and Schedule, consistent with the above Project Completion Date. Z. "Promissory Note" means the Project Note In the amount of the total NSP funs to the DEVELOPER, substantially in the form attached hereto/incorporated herein as Exhibit E In principal amount of Two Million Seven Hundred Seventy Two Thousand Two Hundred Fifty Three Dollars ($2,772,253), gNan by DEVELOPER as promisor, in favor of the CITY, as promisee, evidencing are Loan and performance of the affordability and other covenants and dandelions set forth in this Agreement, secured by e standard Deed of Trust as 2"d but no worse than 3nIposition lien upon the Property, naming the CITY as beneficiary and provided to the CITY no later than the date of initial disbursement hereunder, as well as any amendments to, modifications of and restatements of said Note consented to by CITY. AA. "Rent' means the total monthly payments a tenant pays for a Unit including the following: use and occupancy of the Unit and land and associated facilities, including parking (other than parking services acquired by tenants on an optional basis), any separately charged fees or service charges assessed by DEVELOPER which are required of all tenants (other than security deposits), the cast of an adequate level of service for utilities paid by the tenant (including garbage collection, sewer, water, common area electricity, but not telephone service), any other Interest, taxes, fees or charges for use of the land or associated facilities and assessed by a public or private entity other than DEVELOPER, and paid by the tenant. 86. "Revenue" has the same meaning as Program Income, as defined at 24 CFR 570.501 with the modifications as identified In the Federal Register, Volume 73, No. 194, Docket No. FR -5255-N 01. CC. "Unit"means a dwelling unit of the Affordable Rental Housing. DD. 'Very Law Income Families" means families whose annual income does not exceed fifty percent (50%) of the medlan income for the Fresno, California area as determined by HUD. 2. Tenn. This Agreement and the NSP grant provided hereunder shall be for he period commencing upon Ne date of execution, and shall remain in force for the duration of the longer of the Affordability Period and the Loan unless earlier terminated as provided herein. 3. Timeframe for Completing Pro'ect A. DEVELOPER's daily schedule and hours worked under this Agreement on a given day shall generally be subject to DEVELOPER's discretion and Exhibit A, provided that DEVELOPER shall devote sufficient time as is reasonably necessary to fulfill the spirit and purpose of this Agreement. The DEVELOPER agrees to acquire the Properly with NSP funds and verify verylow income household status for at least seventy one (71) households within me Project Property, not later then August 31, 2010. Extensions may be granted by the City in Its discretion upon DEVELOPER's successful completion of the Agreement requirements, and only to allow for the DEVELOPER's further utilization of Program Income as allowed by HUD and/or In this Agreement. 8, This Section shall survive termination or expiration of Nis Agreement 4, Loan Terms. A The City agrees to provide a NSP Loan to the DEVELOPER in the amount of Two Million Seven Hundred Seventy Two Thousand Two Hundred Fifty -Three Dollars and 001100 ($2.772,253) for eligible costs, The DEVELOPER shall execute and deliver to the City the Loan Documents including the Note, and notarized Deed of Trust, for recordation against the Property. B. The NSP Loan will be due and payable In accordance with the Note and not later than the maturity date provided in the Note. 5. Subordination. The Dead of Trust and/or Declaration of Restrictions may be subordinated to certain approved financing (in each case, a "Senior Loan"), to 2n° but no worse than 3rd position, but only on mention that all of the following conditions are satisfied: (a) all of me proceeds of the proposed Senior Loan, less any transaction casts, must be used to provide acquisition, construction antllor permanent financing for the Project consistent with an approved financing plan: (b) DEVELOPER must demonstrate to the CITY's reasonable satisfaction that subordination of the Deed of Treat and/or Decimated of Restrictions is necessary to secure adequate acquisition, construction, rehabilitation and/or permanent financing to ensure the viability of the Project: (c) the subordination agreement must provide the CITY with adequate rights to cure any defaults by DEVELOPER including providing the CITY or its successor wrM copies of any notices of default. Upon a determination by the City Manager that Me conditions In this Section have been satisfied, the City Manager or his/her designee will be sentenced to execute the approved subordination agreement without the necessity of any further action or approval, subject to prior approval to forth by the Fresno City Attorney. 6. No Litigation Material to Financial Condition. DEVELOPER 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 me best of DEVELOPER's knowledge, is any such Ilfigation or proceeding now threatened, or anticipated against DEVELOPER that, If obviously determined, would have a material adverse effect on Me financial condition, business, or assets of DEVELOPER or on the operation of the Project. 7. No Conflict of Mterest. DEVELOPER represents and warrants as of the date hereof that no official, officer , agent, or employee of the CITY directly or indirectly owns or controls any interest in DEVELOPER, and no person, directly or indirectly owning or controlling any interest in DEVELOPER, is an official, officer, agent, or employee of the CITY. 8. No Legal Bar. DEVELOPER represents and wanants as of the date hereof that me execution, delivery, performance, or observance by DEVELOPER of this Agreement will not, to Me best of DEVELOPER's knowledge, materially violate or contravene any previsions 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 DEVELOPER: or (c) any mortgage, indenture, security agreement, contract, undertaking, or other agreement or Instrument to which DEVELOPER is a Party or Mat is binding on any of its properties or assets, Me result of which would materially or substantially impair DEVELOPER's ability to perform and discharge itsltheir obligations of Its/their ability to complete Me Project under this Agreement. 9. No Violation of Law. DEVELOPER represents and warrants as of the date hereof that, to the best of DEVELOPER's knowledge, this Agreement and the discretion of the Pmject as contemplated by DEVELOPER, do not violate any existing federal, state, or local laws or regulations. 10. No Litigation Material to Pro DEVELOPER represents and warrants as of the date hereof that except as disclosed to, and approved by the CITY in writing, there Is no action, processing, or investigation now pending, or any basis therefor known or believed M exist by DEVELOPER that questions the validity of this Agreement, or of any action to be taken under this Agreement, that would, if adversely determined, materially or substantially Impair DEVELOPER's ability to pimiento add observe its obligations under this Agreement, or that would either directly or indirectly have an adverse effect on or impair Me completion of the Project. 11. Assurance of Governmental Approvals and Licenses. DEVELOPER represents and warrants, as of the date hereof, that DEVELOPER has obtained and, to the best of DEVELOPER's knowledge, is in compliance with all federal, state, and local governmental reviews, consents. authodzatlons, approvals, and licenses presently required by law to be obtained by DEVELOPER for the Project as of the date hereof. 12. Recording Requirements. A. DEVELOPER shall provide CITY with the following written performance reports an or before the dates indicated: 1. From the date of Commencement of the Project, until issuance of the final Certificate of Completion. DEVELOPER shall submit a Monthly Report, In a form approved by the CITU, which will include, at a minimum, the following information: progress of the Project and affirmative marketing efforts (as applicable), and provide a final report submitted within 45 days of the end of the tams hereof and at any time hereunder upon written request of the City. ii. Annually, beginning on Me first day of Me mart following the CITY's Issuance of the Mal Certificate of Completion, and continuing until the termination of the Agreement, DEVELOPER shall submit an Annual Report to the CITY, in a form approved by the CITY. The Annual Report shall include, at a minimum, the following Information: the rent, Me annual income and the family size of Me Households. The report shall also state the dale tenancy commenced for each rental Unit, certification from an officer of DEVELOPER that the Project is in compliance with Me Affordable Rental Housing Requirements, and such other information the CITY may be required by law fo obtain. DEVELOPER shall provide any additional information reasonably requested by the CITY. Annually, beginning on the first day of Me month following he CITY's issuance of the final Certificate of Completion, and continuing until the eaplration of Me Agreement, DEVELOPER shall submit proof of Insurance as required in Paragraph 47 below. 13. Pr' ct PabhumvP rots d AppraisalR 6 A. DEVELOPER is required to ensure Me purchase of Me Foreclosed -upon Property be at a minimum discount of one percent (1%) from me current market - appraised value of the Property. 8. DEVELOPER will be required to perform an appraisal to support their determination of fair market value, for purposes of calculating the purchase discount. The appraisal requirement applies to any NSP -assisted acquisition of a foreclosed -upon home or residential property (including voluntary acquisitions). The appraisal performed must be in conformity with the appraisal requirements of the URA at 49 CFR 24.103 and completed within sixty (60) days prior to a final offer being made for the property by the DEVELOPER. Additional requirements regarding appraisals are included as Exhibit G. Appraisal Requirements. 14. NSP Funds Disbursement A. NSP funds shall be disbursed Into escrow to assist the DEVELOPER in purchasing the Project Property and/or to reimburse DEVELOPER for incurred eligible rehabilitation costs, In accordance with the Proposed Budget attached hereto as Exhibit C and incorporated herein, provided that the specific line Item amounts in said Budget may be varied, added and/or stricken by the City's Housing and Community Development Division Manager, and further provided that in any event total NSP funds disbursed in pursuit of said Budget shall not exceed In the aggregate the lesser of the NSP Loan amount or the CITY'a available and allocated NSP Funding during me term hereof. B. NSP funs shall be disbursed only as authorized above, upon verification satisfactory to CITY that expenses to be incurred in performing the Project are eligible under the Act, accepting to the following schedule and conditions precedent to disbursement, as applicable: 1. Upon written request to CITY and within 30 days thereof, provided Nat CITY's receipt of substantiating invoices, accounts, documents and records for the disbursement request shall all be express contacted precedent to any payment obligation by CITY. ii, Except to the extent expressly provided for herein, all costs/expenses incurred by DEVELOPER hereunder shall be the sole responsibility and liability of DEVELOPER. All funds are paid contingent upon DEVELOPER's continuous compliance with alt applicable, uniform administrative requirements, program regulations: and recapture and reversion requirements set out in the Am. iv. The representations and warranties contained in or Incorporated by reference in this Agreement continue to be free, complete and accurate. v. The DEVELOPER has carried out all of Its obligations and Is in compliance with all the obligations or covenants specified in Mls Agreement, to the extent that such obligations or covenants are required to have been earned out or are applicable at the time of the request for the Disbursement. vi. The DEVELOPER has not com umed or suffered an act, event, occurrence, or circumstance that constitutes an Event of Default or that with the passage of time or giving of nonce or both would constitute an Event of Default. vii. Loan disbursement requested will be used solely for NSP eligible costs that have been properly Incurred and are properly chargeable in connection with the Project. 15. Use of Funds. The DEVELOPER shall use the funds provided by Me CITY solely in pursuh of the Project. 16. Availability of NSP Entitlement Funds. DEVELOPER acknowledges and agrees that the NSP funding hereunder is subject to the control of HUD and may be encumbered, withdrawn, or otherwise made unavailable to me CITY (whether earned or promised to, or by, the DEVELOPER). The DEVELOPER shall not be paid such funds unless and until they are made available for payment to the CRY by HUD and allocated and available per CITY Council Action. No other funds owned or controlled by the CITY shall be obligated under this Agreement unless specifically approved and permitted by me Fresno CITY Council, Nothing herein constitutes a pledging or obligating of CITY funds, its General Fund, or any real and personal property taxes, sales taxes or any other tax revenues. The CITY will provide prompt notice to the DEVELOPER, upon CITY's notice tram HUD, Indicating NSP funds may be unavailable to the CITY. 17. CynSWcHon Standards A. DEVELOPER shall rehabilitate Me proposed housing units 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. B. DEVELOPER, during its lime on We shall maintain Project Properties in a safe and secure state, while complying with all applicable codes, laws, and ordinances. 18, Identification Signage. The DEVELOPER shall place a poster or sign, identifying Me City of Fresno, as a Project participant. The sign shall also include the CITY'S Housing Logo, as well as the Equal Housing Opportunity logo, as mandated by HUD. The posterlsign shall be appropriately placed, and shall be in place for 5 months following Property acquisition. 19. Contracts and Subcontracts. Consistent with this Agreement, all demo06on, hazardous waste abatement, consbucbon work and professional services for the Project shall be performed by persons or shall licensed or otherwise legally aumorized to perform the applicable work or service in the Spite of California and the City of Fresno. The DEVELOPER shall require that each contractor and subcontractor agreement contain a provision whereby the party(les) to the agreement other then the DEVELOPER agree to (p notify the CITY immediately of any event of default by the DEVELOPER thereunder; (II) notify the CITY Immediately of the filing of a mechanic's lien. (Iii) notify the CITY Immetliately of termination or cancellation of to agreement, and (iv) provide the CITY, upon the CITY's request, an Estoppel Certificate ceNfying Nat the agreement is In full fares and affect and the DEVELOPER Is not in default thereunder. The DEVELOPER agrees to notify the CITY immediately of termination or cancellation of any such agmement(s), notice of filing of a mechanic's lien, or breach or default by other party(ies) thereto. 20. Apchan'c's Liens and Stop Notices. A. It any claim of lien Is filed against the Property or a stop notice affecting any financing, NSP Fonds or Funding Sources for the Project is served on the CITY or any other third party in connection with the Project, the DEVELOPER shall, within Wanly (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 the CITY a surety bond In sufficient forth and amount, or provide the CITY with other assurance satisfactory to Me CITY Mat the claim of lien or stop notice will be paid or discharged. B. If Me DEVELOPER fails to discharge, bond or otherwise satisfy the CITY with respect to any lien, encumbrance, charge or claim referred to in this Section, then, in stickler to any other right or remedy, the CITY may, but shall not be obligated to, discharge such lien, encumbrance, charge, or claim at the DEVELOPER expense. Alternatively, the CITY may require the DEVELOPER to immediately deposit with the CITY the amount necessary to satisfy such lien or claim add any costs, pending resolution thereof. The CITY may use such deposit to satisfy any claim or lien that is adversely determined against the DEVELOPER. The DEVELOPER hereby agrees to Indemnify and hold Me CITY harmless from liability for such liens, encumbrances, charges or claims together with all related costs and expenses. 21. Permits and Licenses. Upon CITY's reasonable request, and as applicable, the DEVELOPER shall submit, for CITY approval, all Me necessary permits and licenses required for Commencement of Cemsbuctlon. As the CITY may reasonably request the DEVELOPER, at its sole cost and expense, shall provide to the CITY copies of any and all permit approvals and authonizations including plat plan, plat, zoning variances, sewer, building, and other permits required by governmental authorities other Man the CITY In pursuit of the Affordable Rental Housing Project, and for its stated purposes In accordance with all applicable building, environmental, ecological, landmark, subdivision, zoning codes, laws, and regulations. The DEVELOPER is responsible, at Its sole cost and expense, to determine the location of any raises on the Property and to negotiate with the utilhy companies for and In relocate Me utilities, if any, as necessary to complete Me Project. 22, Fees. Taxes and Other Levies. The DEVELOPER shall be responsible for payment of all fees, assessments, taxes, charges and levies Imposed by any public authority or utility company with respect to the Property or the Project, and shall pay such charges prior to delinquency. However, the DEVELOPER shall not be required to 12 pay and discharge any such charge so long as; (a) me legality thereof is being contested diligently and in goad faith and by appropriate proceedings, and (b) if requested by the CITY, the DEVELOPER deposits with the CITY any funds of other farms of assurances that the CITY, In good faith, may determine from tlme to time are appropriate to protect the CITY from the consequences of the contest being unsuccessful. 23. Covenants and Restrictions to Run with the Land. A. The CITY and DEVELOPER expressly warrant, covenant and agree to ensure that the covenants and restrictions set form In this Agreement are recorded and will run with the land, provided, however, that, on expiration M this Agreement and the Affordable Rental Housing requirements therein, said covenants and restrictions shall expire. DEVELOPER further wi mants, covenants and agrees to ensure that the. covenants and restrictions set forth herein shall run in favor of the CITY. B. The CITY and DEVELOPER 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 lease of the proposed Project by certain Very Low Income Families, and (b) by making possible the obtaining of advantageous financing for acquisition. C. The DEVELOPER covenants and agrees that until the expiration of Ne Affordability Period it shall cause the Affordable Rental Housing to be used for Affordable Housing. O. Without waiver or limitation, me 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 available under law or contract for any Injuries or losses resulting from any violations thereof. E. All present and future owners of Me Affordable Rental Housing and other persons claiming by, through, or under them shall be subject to and shall Comply Wim the covenants and resMGions. The acceptance of a deed of conveyance to the ABortlable Rental Housing shall constitute an agreement that the covenants and restrictions, as may be amended or supplemented from Omer to Sme, are accepted and ratified by such future owners, 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 Affordable Rental Housing, all as though such covenants and restrictions were recited and stipulatetl at length In each and every deed, conveyance, mortgage or lease thereof. F. The failure or delay at any time of Me 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. 24. Displacement of Persons. DEVELOPER warrants, covenants and agrees that It will take all reasonable steps to minimize the displacement of any persons (families, individuals, businesses, nonpreft organizations and farms), 25. Initial and Annual Income Certification. DEVELOPER warrants, covenants and agrees that it shall comply with the procedures for annual income determinations as set forth by the U.S. Department of Housing and Urban Development for me Neighborhood Stabilization Program. DEVELOPER shall obtain, complete and maintain on file, immediately prior to initial occupancy, and annually thereafter, Income certifications from each tenant Household renting any Unit. DEVELOPER shall make a good faith effort to verify that the 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 Me verification process. (1) obtain a pay stub for the most recent pay paring (2) obtain an Income verification forth from theapplicant's cement employer: (3) 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 agendas; (4) obtain an Income tax return for the most recent tax year, or (5) if the applicant is unemployed and has no such but return, obtain another form of independent verification. Copies of household income certification and verification must be available for review and approval by the CITY. DEVELOPER further warrants, covenants and agrees that It shall cooperate with the CITY in the CITY's income certificationlaffordabilgy monitoring adNlties. 26. Lead -Based Point. The DEVELOPER warrents, covenants and agrees that it shall comply with all applicable requirements of the Lead Based Paint Poisoning Prevention Act of 42 U.S.C. 4821 at seq., 24 CFR Part 35 including the HUD 1012 Rule, and 24 CFR 982.4016), including any amendments thereto, in the Affordable Housing Project These requirements apply to all units and common areas in the Project Property. DEVELOPER shall incorporate or cause incorporation of this provision In all contracts and subcontracts for work performed on the Project, which involve the application of paint. DEVELOPER shall be responsible for all disclosure, inspection, tasting, evaluation, mnwl and abatement activities. 27. Affordable Rental Housing A. DEVELOPER covenants and agrees that Ne Project shall constitute Affordable Ransil Housing with at lead seventy one (71) units preserved as Very Low Income Rental Housing during the entire Affordability Period. This covenant as to Affordable Rental Housing shall remain In effect and run with and restrict the land during the entirety of the Affordability Pericd. In the event that DEVELOPER falls to comply with the time period in which me Project must constitute Affordable Rental Housing, CITY shall without waiver or limitation be entitled to injunctive relief, as DEVELOPER acknowledges that damages are not an adequate remedy at law for such breach. 28. Compliance with Environmental Laws A. The DEVELOPER shall cause the Project to be in compliance with, and not to cause or permit the housing project to be in violation of, any environmental law, rule, regulation, ordinance, or statute. Although the CITY may utilize its employees and agents for regular inspection and testing of the eligible Property, the DEVELOPER agrees that, if the CITY has reasonable grounds to suspect any such violation, the DEVELOPER shall be entitled to thirty (30) days' notice and opportunity to cure such violation. If the suspected violation is not cured, the CITY shall have the right to retain an Independent consuflant b inspect and test the eligible Property for such violation. If a violation is discovered, the DEVELOPER shall pay far the reasonable cost of the independent consultant. B. Additionally, the DEVELOPER agrees: 1. That the CITU 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 Nat all cost, expense and liability for such work shall be and remain solely wit the DEVELOPER; and ii. Not to transport to or from the proposed project site(s), or use, generate, manufacture, produce, stare, release, discharge, or dispose of on, under, or about the project still or surrounding real estate, or transport to or from the project site(s), 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, miss, regulations, ordinances, and statutes; and iii. To glue prompt written notice to the CITY of the following: i. Any procall 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 Ne surrounding real estate or the migration thereof from or to other property; 2. All claims made or threatened by any third party against the DEVELOPER or such properties relating to any lass or injury resulting from any hazardous or toxic chemicals, materials, substance, or waste; and 3. The DEVELOPER's discovery of any occurrence or condition on any real property adjoining or in the vicinity of such trophies that would rause such properties or underlying or surrounding real estate or pan 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; and 4. To Indemnity, defend, and hold the 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 the DEVELOPER or any other parry's use or release of any hazardous or toxic chemicals, materials, substance, or wastes on the eligible Property regardless of cause or origin, including 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. 29. Cifirdficale of Completion Upon completion of the acquisition of the Project, DEVELOPER shall certky In writing to the CITY that the Affordable Rental Housing has been acquired Upon completion of the Affordable Rental Housing, DEVELOPER shall also submit to the CITY a cost-ceNfying final budget where DEVELOPER shall identify the actual costs of construction of the Project. This final cost -certification shall identify costs in line -item format, consistent with the Project Budget. Upon a determination by the CITY that DEVELOPER Is In compliance with all of DEVELOPER construction obligations, as specified in this Agreement, the CITY shall furnish, within 30 Islander days of a written request by DEVELOPER, a recordable Certificate of Completion for the Project In the form attached hereto as Exhibit D, The CITY will not unreasonably withhold or delay furnishing the Certificate of Completion. If the CITY fails to provide the Certificate of Completion within the specified time, it shall provide DEVELOPER with a written statement Indicating in what respects DEVELOPER has failed to complete the Project in conformance with this Agreement or has otherwise failed to comply with the terms of this Agreement, and what measures DEVELOPER will need to take or what standards it will need to meet in order to obtain the Cerdficate of Completion. Upon DEVELOPER taking the specified measures and meeting the specified standards, DEVELOPER will cortify to the CITY in writing of such compliance and the CITY shall deliver the recordable Certificate of Completion b DEVELOPER in accordance with the Provisions of this section. 30. Products Management A. Operation of the Pro'ect. DEVELOPER shall lease, operate and manage the Project in full conformity with the terms of this Agreement. B. Occupancy Requirements. Seventy One (71) Project Units shall be rented and occupied by, or IT vacant, available for rental occupancy by (a) persons) whose annual household Income at the time of initial occupancy is not greater than fifty Percent (50%) of the most recent annual median income, calculated and Published by HUD for me Fresrw Metropolitan Statistical Area, applicable to such household's size, and at an affordable price, for me Affordability Period, except upon foreclosure by a lender or transfer in lieu of foreclosure following default under a Dead of Trust. However, if at any fime fallowing transfer by foreclosure or transfer in lieu of foreclosure, but sill during the Affordability Period, the owner of record poor to the foreclosure or transfer in lieu of foreclosure, or any newly formed entry 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 shell be revived according to its original terms. In the event DEVELOPER fails to comply with this Section or me Affordability Periotl is not revived following transfer by foreclosure or transfer in lieu of foreclosure, DEVELOPER shall return to CITY all NSP Funds disburses to DEVELOPER by CITY. Affordable rents will be set at HUD fair market rents, and will not exceed thirty-five percent (35%) of me tenant's household income, including utilities, far the tens of this Agreement. Forty Six (46) Project Units shall be required to meet the affordable housing income restrictions as required by the Housing Set Aside program. C. Leasing the Pro'ect. Before leasing any Units, DEVELOPER shall submit its proposed form of Lease for GITY's review and approval. DEVELOPER covenants and agrees to utilize only Leases that have been approved In advance by CITY. The CITY shall respond to DEVELOPER submission of a sample Lease within Unity (30) days. Should CITY not respond within thirty (30) us" of Lease submihal, DEVELOPER shall be authorized to use the submitted sample Lease. Additionally, DEVELOPER agrees not to terminate Me tenancy or to refuse to renew a Lease with a tenant of the Affordable Rental Housing Striated with NSP Funds except for serious or repeated violation of the teens and conditions of me Lease, for violation of applicable federal, state, or local law, or for other good cause. My such termination or refusal renew must be preceded by not less man 30 days written notice served by DEVELOPER or Its authorized management entity upon the tenant specifying the grounds for such action. DEVELOPER agrees it shall annually report 0 CITY me number of Leases that were trot renewed or terminated and the reason for such non -renewal or termination. D. Lease Provisions. Leases are subject to the following: I . DEVELOPER shall include in Leases for all Units, provisions which authorize DEVELOPER to Immediately terminate the tenancy of any Household one or more of whose members misrepresented any fact material to me Households qualification as a Household for Very Low -Income Families. Each such Lease shall also provide that the Household Is subject to annual certification, and mat, if the Household's annual income increases above the applicable limits for Very Low -Income Families such Household a rent may be subject to Increase to the lesser of (1) the amount payable by tenant understate or local law or (2) thirty-five percent (35%) of the Household's actual adjusted monthly income. E. Final Management Plan. Within sixty (60) calendar following property purchase, DEVELOPER shall submit to the CITY, for review and approval, a plan for marketing and managing the proposed Affordable Rental Housing ("Final Management Plan'), The Final Management Plan shall address in detail how DEVELOPER or its designated management entity plans to market me availability of Units to prospective tenants and how DEVELOPER plans to certify the eligibility of potential tenants. The Final Management Plan shall also address how DEVELOPER and/or the management entity plan to manage and maintain the Affordable Rental Housing, and shall include appropriate financial information and documentation. The Final Management Plan shall 17 contain detailed descriptions of policies and procedures with respect to tenant selections and evictions. Topics to be covered in these procedures shall Include at a minimum the following: Interviewing procedures for prospective tenants; Previous rental history of tenants with references, Credit reports and checks; Criminal background checks', Deposit amounts, purpose, use and refund policy; Employmentllncome verification', Occupancy restrictions; Income Limits Equal Housing Opportunity Statement, Restrictions on use of the premises; and TenanVLandiord dispute resolution procedures. I. The Final Management Plan shall contain copies of all standardized fortes associated with the above listed topics. The Final Management Plan shall include a form Lease agreement that DEVELOPER propose to enter into wit Project tenants. DEVELOPER shall abide by the terns of this Final Management Plan, approved by to CITY, In marketing, managing and maintaining the Housing. ii. At least ninety (90) calendar days prior to to Project Completion Data DEVELOPER shall also submit any proposed management contract to to CITY for prior review. The CITY shall have the right to review any proposed amendments, other tan renewals to the management contract, and any new management contracts during the term of this Agreement Such management contrad(s) shall contain a provision expressing this right. F. Property Management With respect to the Project, DEVELOPER shall comply wit to following: ( Management Responsibllifies. DEVELOPER directly andlor trough its designated management entity, is speofically responsible for all management functions with respect to the Affordable Rental Housing Project Including, without limitation, the selection of tenants, certification and re -certification of Household size and income, evictions, collection of Rents and deposits, construction management. affirmative marketing, maintenance, landscaping, routine and extraordinary feature, replacement of capital Items and security. The CITY shall have no responsibility for such management of the Project. G. Maintenance and SecunN. DEVELOPER shall at its own expense maintain the Affordable Rental Housing in good condition, in good repair and In descent, safe, sanitary, habitable and tenantable living conditions for the benefit of to Unit occupants. DEVELOPER shall not comm t or permit any waste on of to the Affordable IN Rental Housing, and shall prevent and/or rectify any physical deterioration of the housing. DEVELOPER shall maintain the housing In conformance with all applicable federal, state and local laws, ordinances, codes and regulations, the Final Management Plan, and this Agreement. H. Damage to Provertv. To the extent consistent with the requirements of any permitted encumbrance, or as otherwise approved by the CITY, and subject to Me insurance requlremeols of this Agreement, if any building or improvement constructed on the Property is damaged or destroyed by an insurable cause, DEVELOPER shall, at its cost and expense, diligently undertake to repair or restore said buildings and improvements consistent with the original Plans and SahifCatlons of the Project Unit. Such work or repair shall commence within ninety (90) days after Me insurance proceeds are made available to DEVELOPER and shall be complete within one (1) 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. DEVELOPER shall make up the deficiency. I. Nondiscrimination. All of the Units shall be available for occupancy on a continuous basis to members of the general public who afeincome eligible. DEVELOPER shall not illegally discriminate or segregate in the development, construction. use, enjoyment, occupancy or conveyance of any part of the Affordable Rental Housing Project or Property on the basis of ram, color, ancestry, national origin, religion, sex, age, marital status, family status, source of income/rental assistance subsidy, physical or mental disability, Acquired Immune Derdency Syndrome (AIDS) or AIDS-related conditions (ARC), sexual orientation, or any other arbitrary basis. DEVELOPER shall otherwise comply with all applicable local, stale and federal laws concerning nondiscriminatlon in housing. Neither DEVELOPER nor any person claiming under or through DEVELOPER, shall establish or permit any such macros or practices of illegal discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants or vendeas of any Unit or In connection with employment of persons for the construction of any Unit. All deeds or contracts made or entered into by DEVELOPER as to the Units or the housing project or portion thereof, shall contain coants concerning nondiscrimination consistent with this section. DEVELOPER shall Include a statement in all advertisements, notices and signs for availability of Units for rent to the effect that DEVELOPER is an Equal Housing Opportunity Provider. A- Nothing in this section is intended to require DEVELOPER to change Me character, design, use or operation of the Project: or to require DEVELOPER to obtain licenses or permits other than those required for Me Project. J. Rent Schedule and Utility Allowances. DEVELOPER covenants and agrees not to charge rent for Units in an amount which exceeds those rents as established by HUD to be fair market rent for the Fresno, California area and fuller covenants and agrees not to Impose a monthly allowance for utility services to tenants of such Units In excess of an amount approved by HUD in accordance with 24 CFR 19 92.252. DEVELOPER agrees to human to the CITY a certificate setting farm the maximum monthly rentals for Units and the monthly allowances for utilities and services to be charged during any annual perod until Me expiration of Me Affordability Period. K. Fees Taxes and Other Levies. DEVELOPER shall be responsible for payment of all fees, assessments, taxes, charges and levies Imposed by any public authority or utility company with respect to the Propel or Me Project, and shall pay such charges pror to delinquency. However, DEVELOPER shall not be required N 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 Me CITY, DEVELOPER deposit with Me CITY any funds or other forms of assurances that the CITY, In good faith, may determine from time to time are appropriate to protect the CITY from Me consequences of the contest being unsuccessful. L. FOJ intim. DEVELOPER shall promptly inform the CITY of any new financing or funding, and DEVELOPER shall provide the CITY copies of all agreements with any and all Funding Sources for this Project. DEVELOPER agrees to notify the CITY Immediately of termination or cancellation of any such agreements) or receipt of notice of defauitidef not thereunder. DEVELOPER 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 Me event DEVELOPER fails to comply with its obligations of MIs section, the loan shall become immediately due and payable as provided for In this Agreement. This section shall survive expiration or termination of this Agreement. 31. Financial Statements and Adults A. The DEVELOPER, as a recipient of federal financial assistance, Is required to comply with the provisions of the Single Audit Act of 1984 (31 U.S.C. Sections 7501 at seq.), as amended. Annually, within one hundred and eighty (180) days following: 1) the end of fiscal years) In which Me NSP Funds are disbursed hereunder, and 2) the end of fiscal years) in which this contract shall temunale, and otherwise upon Me City's, written request during the tens of this Agreement, DEVELOPER, at its sole cost and expense shall submit to Me City: Audited annual financial statements that are current, signed, and prepared according b generally accepted accounting principles consistently applied (except as ethereal disclosed thereln); and It. Audited Finarmal Statements covering the income and expenses, and the financial transactions for Me Project during the prior fiscal year. 32. Inspection and Audit of Books Records and Documents. A. The DEVELOPER shall be accountable to the CITY for all NSP Funds disbursed for Me project pursuant to this Agreement. Any duly authorized representative of the CITY, the State, or HUD shall, at all reasonable times, have 20 access to and the right to inspect, copy, make excerpts or transcripts, audit, and examine all books of accounts, records, files and other papers or property, and other documents of the DEVELOPER pertaining to the Project or all matters covered in this Agreement and for up to five (5) years after the aspirated or termination of this Agreement. B, The DEVELOPER will maintain books and records for the Project using generally accepted accounting principles. The DEVELOPER agrees to maintain books and records that accurately and fully show the date, amount, purpose and payee of all expenditures financed with NSP Funds and to keep all invoices, receipts and other documents related to expenditures financed with NSP Funds for not less than five (5) 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, funding applications, purchase orders, invoices, loan documents, computer printouts, correspondence, memoranda, and electronically stored versions of the foregoing. This section shall survive the termination of this Agreement. C. The 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 the DEVELOPER in which case the DEVELOPER shall bear the cost of such audit This section shall survive me termination of this Agreement. O. The DEVELOPER will cooperate fully with the CITY, the State, and HUD in connection with any interim or final audit relating to the Programs and the Project that may be performed relative to the performance of this Agreement. 33. Inspection of Property. Any duly auNodzad representative of the CITY, the State, or HUD shall, at all reasonable times, have access and the right to inspect due Properly until completion of the Project. 39. No Other Liens. The DEVELOPER shall not create or incur, or suffer to be created or incurred, or to exist, any additional mortgage, pledge, encumbrance, Ilen, charge, or other security interest of any kind on the eligible Pmparty, other than inose related to construction or pre -development loans in relation to the Affordable Housing Project consistent with the attached Exhibit C Project Budget, without the prior written consent of the CITY. 35. Payment of Liabilities. The DEVELOPER 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 conciliar business, or assets or on the operation of the Prclect(s), except such obligations and liabilities that have been disclosed to the CITU in writing and are being contested in goad faith. 36. Termination of AcreemenL A. This Agreement shall terminate upon the earlier of: I. DEVELOPER's Default. The pates agree that each of the fallowing shall constitute a default by DEVELOPER for purposes of this Agreement where such breach remains uncured for thirty (30) calendar days following City's notice to DEVELOPER describing such breach, or if such breach Is not reasonably susceptible of cure, immediately upon notice of breach by City to DEVELOPER: 1. The DEVELOPER'S use of NSP funds for other uses than describetl In the Scope of Work. 2. The DEVELOPER's failure to obtain and maintain the insurance coverage required under this Agreement. 3. Except as otherwise provided in His Agreement, the failure of the DEVELOPER to punctually and properly perform any other covenant or agreement contained in this Agreement including without limitation the following: a. Failure M meet padonnance measures and schedule. b. Any representation, warranty, or certificate given or furnished by or on behalf of DEVELOPER shall prove to be materially false as of the date of which the representation, womanly, or certificated was given, or Mal DEVELOPER concealed or failed to disclose a material fact to City, provided, however, that If any representation, warranty, or certification Mat proves to be materially false is due merely to DEVELOPER's inadvertence, DEVELOPER shall have a thirty (30) day opportunity after written notice thereof to cause such representation, warranty, or verification to be tree and complete in every respect. C. DEVELOPER 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 J. DEVELOPER's failure, inability or admission in writing of its Inability to pay its debts as they become tlue or DEVELOPER'S assignment for me benefit of creditors. 22 e. A receiver, trustee, or liquidator shall be appointed for DEVELOPER or any substantial part of DEVELOPER's assets or properties, and not be removed within ten (10) days. f. DEVELOPER's breach of any other material condition, covenant, warranty, promise or representation contained in this Agreement not otherwise identified within his section. fl. Written notice by either party to the other without cause. III, Complete performance by each parry hereto. iy Expiration. B. Upon the happening of a default by DEVELOPER and a failure to cure said default within 30 days of the date of the notice of default (or a more immediate date H the default is related M imminent health and/or safety concems). City obligation to disburse NSP funding shall terminate, and City may also at its option and without notice institute any action, suit, or other 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: L Terminate Otis Agreement immediately upon written notice m DEVELOPER, in which event any unearned and improperly NSP funds disbursed to DEVELOPER by City shall be returned to City; Bring an action in equitable relief (1) seeking specific performance by DEVELOPER of Me terms and conditions of Nis Agreement, and/or (2) enjoining, abating or preventing any violence of said terms and conditions, anther (3) seeking declaratory relief, III, Pursue any other remedy allowed at law or In equity or under this Agreement. C, Upon any termination, the City's obligations hereunder shall terminate and all unexpended or improperly expended NSP funds subject to This Agreement shall revert to andlor be recaptured for the City's NSP Program, provided that if the DEVELOPER Is not in default at the time of termination the DEVELOPER shall be reimbursed for eligible project activities satisfactorily performed prior to the effective date of the notice of termination. 0. Nolwimstanding me foregoing and without waiver or limitation, in accordance with the Act including 24 CFR 65.43. suspension or termination of this Agreement may occur if the DEVELOPER materially fails to comply with any term of the 23 NBP grant, and the grant may be terminated for convenience in accordance with 24 CFR 85.44. E. Those provisions of this Agreement Intended by its terms therein to survive the termination of this Agreement shall so survive. 37. On -Site Monitoring. Authorized representatives of HUD or the City shall have the right to monitor the DEVELOPER's performance under this Agreement. Such monitoring may Include inspection activities, review of records, and abandoned at meetings. 38. Records. A. The DEVELOPER shell maintain all necessary books and records with respect to disbursement of money, In property, and to personnel in accordance with usual and customary business accounting practices. The DEVELOPER shall document all DEVELOPER expenditures under this Agreement wit properly executed payroll, time records, invoices, contracts, vouchers, or other official documentation evidencing the nature and propdery of to charges. All such materials shall be retainetl by the DEVELOPER for a period of not less than five (5) years from termination of this Agreement. B. The DEVELOPER shall, at such time and in such forms as the City or HUD may require, furnish statements, records, data, copies, and information pertaining to matters covered by this Agreement. The City has to right, upon request, to inspect and copy all DEVELOPER documents and records pertaining to this Agreement. 39. Compliance with Governmental Regulations. A. The DEVELOPER shall, at its sole cost and expense, comply with applicable municipal, county, state, and federal law, regulations, rules and requirements now In force, or which may hereafter be in force, pertaining to any and all activities under this Agreement. The DEVELOPER shell comply with all applicable provisions of 24 CFR 570, et seg„ including Subpart K thereof, except that the DEVELOPER does not assume to CITY's non -delegable environmental responsibillFes described In 24 CFR 58 andlor 24 CFR 570-604, and does not assume the City's responsibility for initiating Ne review, process under Executive Order 12372. I. Both City and DEVELOPER agree to jointly and severally comply with the requirements of to Office of Management and Budget Circular A-87, "Cast principles for State, Local, and Indian Tribal Governments"; OMB Circular A-133"Audits W States; Local Governments and Non -Profit Organizations"; 24 CFR Part 85 "Uniform Administrative Requirements for Grants and Cooperative Agreements to State and Local Governments"; and 24 CFR Part 570.502 "Applirabllity of Uniform Administrative Requirements". Each parry shall be responsible for determining the applicability of the foregoing. it. The DEVELOPER agrees to comply with all applicable requirements of Section 50v[ of the Rehabilitation Act of 1973 and HUD Implementing regulation 24 CFR Part B. 40. Pre act Responsibilities/Public Worlix-P 'I' Wage Requirements DEVELOPER shall be solely responsible for all aspects of DEVELOPER's conduct in connection with the Project, including but not limited to, compliance with all local, state and federal laws Including, without limitation, as to prevailing wage and public bidding requirements, as applicable. This Project is a'public work" project for federal purposes including Davis Bacon and Related Acts wage requirements absent writlen directionldelerminabon otherwise by U.S. HUD or a court of competent jurisdiction. Based thereon DEVELOPER shall cause the Project work to be performed as a'public work". The Council of the City of Fresno has adopted Resolution No. 82-291 ascertaining the general prevailing rate of per diem wages antl per diem wages for holidays and overtime in the Fresno area for each craft classlficatlon, or type of workman needed in the execution of contacts for the City. A copy of the resolution is on file at the Office of the City Clerk. Actual wage schedules are available upon request at the CITY's Construction Management Office. Without limiting the foregoing, DEVELOPER shall be solely responsible for the quallty and suitability of the work completed, the supervision of all contracted work, qualifications and financial conditions of and performance of all contractors, subcontractors, consultants and suppliers. Any review or inspection undertaken by the CITY with reference to the Project and/or payroll mondonnglauditing is solely for me purpose of determining whether DEVELOPER is properly discharging as obligation to the CITY, and shall not be relied upon by DEVELOPER or by any third parties as a warranty or representation by the CITY as to governmental compliance and/or the quality of the work completed for the Project 41. Contact Award A. The DEVELOPER will be responsible for all aspects of the project contract award and management Including any. compliance with all applicable laws and regulations. The DEVELOPER shall verify with the Labor Relations and Equal Opportunity Divislon of the U.S. Department of Housing & Urban Development (HUD) Area Office that any low bidder has not been debarred or suspended tam participating in the federal project 1. Any such award shall be subject to all the terms and conditions herein. 42. Accessibility A. The DEVELOPER warrants, covenants and agrees that it shall comply with 24 CFR Pan B, which implements Section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 194), including, without limitation, the COnstlllCtOn of the Project so that it meets the applicable accessibillly requirements, including, but not limited to, the following: 25 I. At least five percent (5%) of the dwelling units, or at least eleven (11) units, whichever is greater, must be constructed to be accessible for persons with mobility disabilities. An additional two percent (2%) of the dwelling units, or at least four (4) units, whichever is greater, must be accessible for parsons wild hearing or visual disabilities. These units must be constructed in accordance with the Uniform Federal Accessibility Standards ( -FAS) or a standard that is equivalent or stricter. These mandates can be found in 24 CFR Part 8, which Implements Section 504 of the Rehabilitation Act of 1973 (29 U.5 C. 794), IL The design and construction requirements of the Fair Housing Act (Title VIII of the Civil Rights Act of 1968, as amended), including the following seven (7) requirements of the Fair Housing Accessibility Guidelines: 1. Provide at least one accessible building entrance on an accessible route. 2. Construct accessible and usable public and common use areas. 3. Construct all doors to be accessible and usable by persons in wheelchairs, 4, Provide an accessible route into and through Me covered dwelling unit. 5. Provide light switches, electrical outlets, thermostats and other environmental controls in accessible locations. S. Construct reinforced bathroom walls for later Installation of grab bars around toilets, tubs, shower stalls and shower seats, where such facilities are provided. 7. Provide usable kitchens and bathrooms such that an individual who uses a wheelchair can maneuver about the space. 43. Discrimination Prohibited. A. The DEVELOPER agrees to comply with the City's Fair Employment Practices and shall not employ discriminatory practices in the provision ofservices, employment of personnel, or in any other respect on the basis of race, color, religion, sex, national origin, ancestry, or physical or mental handicapped. More specifically, the DEVELOPER agrees as follows: 26 I. The DEVELOPER warrants, covenants and agrees that it shall comply with he CITY' s' ARrmalive Marketing Policy" document, incorporated herein, as amended from time to time. DEVELOPER shall maintain records of actions taken to affirmatively market units purchased and rehabilitated In the future, and In assess Me results of these actions. I. No person in the United States shall, on the grounds of race, color religion, national origin, sex or sexual preference, ancestry, or physical or mental handicap be excluded from participation in, be denied the benefits of, or be subject to discrimination under any program or activity made possible by or resulting from this Agreement. W. The DEVELOPER will not discriminate against any employee or applicant for employment because of race, color, religion, sex, sexual preference. national origin, ancestry, or physical or mental handicap. The DEVELOPER shall take affirmative action to ensure that applicants are employed, and the employees are heated during employment, without regard to (heir race, color, religion, sex, naonal origin, ancestry, or physical or mental handicap. Such action shall Include, but not be limited to, the following: employment, upgrading, demotion or pari recruitment or recruitment adverpsing; layoff or lamination; rates of pay or other forms of compensation; and selection for training, including apprenticeship. The DEVELOPER agrees fo post in conspicuous places available to employees and applicants far employment, notices setting forth the provision of this nondiscrimination clause, iv. The DEVELOPER will, In all saliciamon or advertisements far employees placed by or on behalf of the DEVELOPER, state all qualified applicants will receive consideration for employment without regard to race, color, religion, sex, sexual preference, national origin, ancestry or physical or mental handicap. B. The DEVELOPER will send to each labor union or representative of workers wit which it has a collective bargaining agreement or other compact or understanding, a notice advising the such labor union or workers' representatives of the DEVELOPER'S commitment under this section and shall post apples of Ne notice in conspicuous places available to employees and applicants for employment. 44. Conflict of Interest. A. Prior to City's execution of this Agreement, DEVELOPER shall complete a City of Fresno Conflict of Interest Disclosure Statement. Said Statement Is attached hereto as Exhibit F and incorporated herein by reference. During the term of This Agreement. DEVELOPER shall have the obligation and duty to immortately notify City in writing of any change to Ne Information provided by DEVELOPER on Exhibit F. I. No member, officer, or employee of the DEVELOPER or its designees or agents who exercise any function or responsibility with respect to the programs during his/her tenure or for one (1) year hereafter, shall have any Interest, 27 direct or Indirect, in any contract or subcontract, or the proceeds thereof for Servlces to be performed in connection with this Agreement. The DEVELOPER shall incorporate, or rause to be incorporated, in all contracts and subcontracts a provision prohibiting such Interest pursuant to Ne purposes of this section. ii. DEVELOPER shall not employ or retain the services of any person while such person either is employed by City or is a member of any City commission, board, commiftee, or similar City body. This requirement may be waived by Ne City's Chief Adminharative Officer If no actual or Potential conflict is involved. Iii. DEVELOPER shall comply with all applicable laws, rules, regulations and requirements goveming avoidance of impermissible conflicts, including without limitation Government Code 1090 at seq., the requirements of the Califomia Political Reform Act (Govemment Cade Section 67100 at, seq.) and the ragulatlons of the Fair Politirat Propose Commission concerning disclosure and disqualification (2 California Code of Regulations Section 16700 at. seq.). IV . DEVELOPER represents and warrants that as of the effective date hereof, it represents no client or customer whose Interests are adverse to the City's. B. This section shall survive expiration or termination of this Agreement 45. Assurance of Governmental Approvals and Licenses. DEVELOPER represents and warrants, as of the date hereof, that DEVELOPER has obtained and, to the best of DEVELOPER'S knowledge, is in compliance with all federal, state, and local govemmental reviews, consents, authorizations, approvals, and licenses presently required by law to be obtained by DEVELOPER for the Project as of the date hereof. 46. Indemnification. A. DEVELOPER shall indemnify, hold harmless and defend City and each of its officers, officials, employees, agents from any and all loss, liability, fines, penalties, forfeitures, costs and damages (whether in contracttort or strict liability, including but not limited to personal injury, death at any time and property damage) incurred by City, DEVELOPER or any other person, and from any and all claims, demands and actions In law or equity (including adomey's fees and litigation expenses), arising or alleged to have arisen directly or indirectly out of DEVELOPER's performance of this Agreement. DEVELOPER's obligations under the preceding sentence shall apply regardless of whether City or any of their officers, officials, employees, agents or authorized volunteers are negligent, but shall not apply to any loss, liability, fines, penalties, forfeitures, costs or damages caused solely by the grass negligence, or caused by the willful misconduct, of City or any of hs officers, officials, employees, agents or authorized! volunteers. B. If DEVELOPER should contract or subcontract all or any portion of the work to be performed under this Agreement, DEVELOPER shall require each contractor or subcontractor to indemnify, hold harmless and defend City and each of its officers. officials, employees, agents and authorized volunteers in accordance with the terms of the preceding paragraph. C. This section shall survive termination or expiration of this Agreement. 47. Insurance and Bonds. A. Insurance. Throughout the life of Nis Agreement, be DEVELOPER shall pay for and maintain In full force and effect all policy(tes) of insurance required hereunder with (an) insurance companybes) either (t) admitted by time 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 the Cl Risk Manager, The following policies of insurance are required: I. Prior to repair and rehabilitated of the Project Property and until Issuance of Cedificate(s) of Completion, BUILDERS RISK (Course of Construction) insurance in an amount equal to the completed value of the project wind no coinsurance penalty provisions. Following acquisition of me Project Property COMMERCIAL PROPERTY insurance which shall be at least as broad as the most current version of Insurance Service Office (ISO) Commercial Property Form CP 10 30 (Cause of Loss — Special Form), with limits of Insurance In an amount equal to the full (100%) replacement cost (without deduction for depreciator) of the Project Property with no coinsurance penalty provisions. Such insurance shall include coverage for business income, including "rental value", in an amount equal to the two (2) years of annual Rent. Coverage for business income, including 'rental value," shall be at least as broad as the most current version of Insurance Service Office (ISO) Commercial Property Form CP 0030. III. The above described pclicy(ies) of insurance shall be endorsed to provide that the coverage shall not be cancelled, non -renewed, retluced in coverage or in limits except after thirty (30) calendar day written notice has been given to CITY. Upon issuance by be insurer, broker, or agent of a notice of cancellation, non -renewal, change or reduction in coverage, the DEVELOPER or its contractors/subcontractors, as the case may be, shall furnish City with a new corticate and applicable endorsements for such telicy(ies). In the event the policy is due to expire during me term of this Agreement, DEVELOPER shall provide a new dominate, and applicable endorsements, a new certificate evidencing renewal of such policy shall be provided not less than fifteen (15) days prior to the expiration date of the expiring policy. Upon issuance by the insurer, broker, or agent of a notice of cancellation, change or reduction in coverage, me DEVELOPER or its contractorslsubcodtactors, as the case may be, shall file with be OILY a certified copy of the new or renewal policy and certificates for such policy. 29 iv. The Builders Risk (Course of Construction) and Fire and Extended Coverage Insurance policies shall the endorsed to name the City as a loss payee. DEVELOPER shall furnish City with all ceNlcate(s) and applicable endorsements effecting coverage required hereunder. All ceNflcates and applicable endorsements are to be received and approved by the City's Risk Manager or his/her designee prior to DEVELOPER'S execution of this Agreement vi. The fact Mat insurance is obtained by DEVELOPER shall not be deemed m release or diminish the liability of DEVELOPER, including, without limitation, liability under the Indemnity provisions of this Agreement The duly to Indemnify City and each of its officials, officers, employees, agents and volunteers shall apply to all claimsand liability regardless of whether any insurance policies are applicable. The policy limits do not act as a limitation upon the amount of indemnification to be covered by DEVELOPER. Approval or purchase of any insuri contracts or policies shall In no way relieve from liability nor limit the liability of DEVELOPER. A. Upon request of City DEVELOPER shall immediately furnish City wth a complete copy of any insurance policy required under this Agreement, Including all endorsements, with said copy certified by the underwriter to be a true and correct copy of the original policy. This requirement shall survive expiration or terininadon of this Agreement. viii. If at any time during me the of this Agreement or any extension, the DEVELOPER fails to maintain the required insurance in full force and effect, all work under this Agreement shall be discontinued immediately, until notice Is received by the CITY that the required insurance has been restored to full farce and effect and that the premiums therefore have been paid for a period satisfactory to me CITY, Any failure to maintain the required insurance, subject to notice and cure requirements herein, shall be sufficient cause for the CITY to terminate this Agreement. B. Bonds. The DEVELOPER shall pay for and maintain good and sufficient surety bonds from a corporate surety, admitted by the California insurance Commissioner to do business In the State of California and TreasuryAsted, In a form satisfactory to the CITY and naming the CITY as Co -Obligee. 1. The 'Faithful Performance Bondshall be at least equal to 100% of DEVELOPER'S estimated construction costs to guarantee faithful performance of Me Project, wIMIn the time prescribed in a manner satisfactory to the CITY, and that all materials and workmanship will be free from anginal or developed defects, II, The "Material and Labor Bond" shall be at least equal to 100% of DEVELOPER'S estimated construction costs to satisfy claims of material supplies and of mechanics and laborersemployed for this Project. The bond shall be maintained by DEVELOPER in full force and effect until Me PmjW is completed and until all claims 30 for materials and labor are paid, released, or time barred, and shall otherwise comply with any applicable provisions of the California Civil Core. iii. In lieu of the bonds required above, CITY, in its sole discretion, may accept from Developer an Irrevocable Standby Letter of Credit issued with the CITY named as the sole beneficiary In the amounts) of the bonds required above. The Irrevocable Standby Letter of Credit is to be Issued by a bank, and In a form, acceptable to CITY. This Irrevocable Standby Letter of Credit shall be maintained by Developer in full fares and affect until CITY Is provided with a recorded Notice of Completion far construction of the Project and shall be subject to and governed by the laws of the State of California, d8. DEVELOPER Certification A. The DEVELOPER condition; to the best of its knowledge and belle( that no federally appropriated funds have been paid or will be paid by or on behalf of the undersigned, to any person for Influencing or attempting to influence an officer or employee of any agency, or a member of Congress, or an officer or employee of Congress, or an employee of a member of Congress, in connection with the awarding of any federal contract, the making of any federal grant, the making of any federal loan, Me entering into of any cooperative agreement, or the extension, continuation, renewal, amendment or modification or any Federal contract, grant, loan, or cooperative agreement. B. If any funds other than federally appropriatetl funds have been paid or will be paid to a person for influencing an after or employee of any agency, a member of Congress, an officer or employee of Congress, or an employee of a member of Congress in connection with this fedeal contract, grant, loan, or cooperative agreement, the. DEVELOPER shall complete and submit Standard Form -LLL, 'Disclosure Farm to Report Lobbying;' in accordance with its Instructions. G, The DEVELOPER shall require that the language of the above codification be included in the documents for all DEVELOPER tiers (including subcontracts, subgrants, and contracts under grants, loans, and cooperative agreements) and that all developerslrountra dmfs shall certify and disclose accordingly. D. This certifcafion is a material representation of fact upon which reliance was placed when this transaction was made or entered into. Submission of this certification is a prerequisite for making or entering Into this Agreement. 49. Independent Contractor. In the famishing of the services provided for herein, the DEVELOPER is acting as an independent contractor. Neither the DEVELOPER, nor any of its officers. associates, agents or employees shall be deemed an employee or agent of the City for any purpose. Nothing In this Agreement shall create a limited of general partnership or joint venture, DEVELOPER shall have no authority to bind the City absent City's express written consent Except to the extant otherwise provided in this Agreement, DEVELOPER shall bear its own costs/expenses in pursuit hereof. 50. Notices. Any notice required or intended to be given to either parry under the terms of this Agreement shall be in wnting and shall be deemed to be duly given If delivered personally or deposited into me United! States mall, with postage prepaid return receipt requested, addressed to the party to which notice is to be given at the party's address set forth on the signature page of this Agreement or at such other address as the parties may from time to time designate by written notice. 51. Sinding. Subject to Section 52 below ("Assignmeni once mis Agreement is signed by all parties, it shall be binding upon, and shall inure to the benefit of, all parties, and each parties' respective heirs, successors, assigns, transferees, agents, servants, employees and representatives. 52. Assianmen[. This Agreement Is personal to the DEVELOPER and there shall be no assignment by the DEVELOPER of its rights or obligations under this Agreement without the prior written approval of the City. Any attempted assignment by the DEVELOPER, its successors or assigns, shall be null and void unless approved in writing by the City. Notwithstanding the above. DEVELOPER may assign its rights, duces and obligations, title and interest under this Agreement to a wholly owned single purpose subsidiary of DEVELOPER, subject to written approval by City, However, in the event of such assignment as provided herein, DEVELOPER is in no way relieved of any of its responsibilities, and shall remain fully responsible and liable to City under the terms of this Agreement and all calmed agreements, and DEVELOPER shall retain full correct and responsibility for the Project. 53, Waiver. A. The waiver by either parry of a breach by the other of any provisions of mis Agreement shall not constitute a continuing waiver or a waiver of any subsequent breach of either the same or a different prevision of this Agreement L No prevision of this Agreement may be waived unless In writing and signed by all parties to this Agreement. Waiver of any one provision herein shall not be deemed to be a waiver of any ower prevision herein. 54. Head'na. The section headings in this Agreement are for convenience and reference only and shall not be construed or held In any way W explain, modity or add to the interyrotabon or meaning of me provisions of this Agreement. 55. Severability. Tice provisions of this Agreement are severable. The invalidity, or unenforceability of any one prevision in this Agreement shall not affect the other provisions. 32 56 Interpretation. The parties acknowledge that this agreement in its final form is the result of the combined efforts of the cables and that, should any provision of this Agreement be found to be ambiguous in any way, such ambiguity shall not be resolved by construing this Agreement in favor of, or against any party, but rather by construing Me terms in accordance with their generally accepted meaning. In the event of any confilct between the body of this Agreement and any Exhibit or Attachment hereto. the terms and conditions of this Agreement shall control and take precedence. 57. 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 in such proceedingor action shall be artifact to recover from Ne other party its reasonable attorney's fees and legal expenses. 58. Time of Essence. Time is of the essence for the performance of this Agreement 59. Extent of Agreement. Each party acknowledges that they have read and fully understands the contents of this Agreement. This Agreement represents the entre and Integrated agreement between the parties with respect to the subject matter hereof and supersedes all poor negotiations, representafions and agreements, either written or oral. This Agreement maybe modified only by written instrument duly authorized and executed by both the City and the DEVELOPER. 60. Precedence of Documents. In the event of any conflict between Ne body of this Agreement and any exhibit hereto, the terms and conditions of the body of this Agreement shall control and take precedence over terms and conditions expressed within the exhibit. Furthermore, in the event of any conflict between the body of tis Agreement and any document or instrument referenced therein, the terms and conditions of the body of this Agreement shallcontrol and take precedence over terms and conditions expressed within said document or Instrument. /11 33 IN WITNESS WHEREOF, the parties have executed this Agreement at Fresno, California, the day and year first above written. CITY OF FRESNO FRESNO REVITALIZATION CORPORATION a California nonprofit public benefit corpaa0on Brace Rutltl NamThe: Pre MinPresident ml Assistant City Manager The: President ATTEST: FRESNO REVITALI] FON CORPORATION REBECCA E. KLISCH a California nonprofit Public benefit corpoafion CITY CLERK \,${ pp By Lm4 jai- 1 {e t. 5/26//0 Qal Deputy w Name:. 'Rom CA W721 , Title: APPROVED AS TO FORM: JAMES SANCHEZ CITY ATTORNEY A2'� �'.—o I'9 By: N a Deputy r_taf1:aafyaRn CITY: FRESNO REVITALIZATION LORPORATIM Housing and Community Development Division 2344 Tulare Sheet Suite 200 Planning and development Department Fresno. CA 93721 Ann: Housing Manager 2600 Fresno St. Room 3070 'Rom CA W721 Attachments: Exhibit A — Project Description, Schedule and Legal Description Exhibit B — Dedaration of Restrictions Exhibit C — Budget and Cash Flow Exhibit D — Certificate of Completion Exhibit E — Promissory Note Exhibit F — Disclosure of Conflict of Interest Exhibit G — Appraisal Requirements 119 CLERK'S CERTIFICATION State of California) County of Fresno ) On May 26, 2010, before me. Cindy Bruer. Deputy City Clerk, personally appeared Bruce Rudd r Assistant CM Manager of the City of Fresno who proved to me on the basis of satisfactory evidence to be the person(s) whose camels) is/are subscnbed to be within instrument and acknowledged to me that he/shehhey executed the same in his/her/their authorized capacity(ies), and that by hislberttheir signaturels) on the Instrument the person(s). acted executed the instrument. I certify under PENALTY OR PERJURY under the laws of the State of California Nat the foregoing paragraph is true and correct. WITNESS my hand and official seal. REBECCA E KLISCH. CMC CITY CLERK, City of Fresno BY 0±2vW r. Dep EXHIBIT A Project Description, Schedule and Legal Description A. The Agreement provides for the use of Neighborhood Stabilization Program (NSP) funds in the amount of Two Million Seven Hundred Seventy Two Thousand Two Hundred Fifty -Three Dollars ($2,]]2,253), by the DEVELOPER, for the purchase am rehabilitation of a one hundred eighteen (118) unit multi family radical housing project. B. The project is located at 3033 E. Platt Avenue, Fresno, CA 93721, wit APN 468-390-04s. NSP FUNDED UNITS % of Median One Bedroom OnRs Two Bedroom Units Totals 50%or less 52 19 71 AM1OMable per Housng 5el Aside edits 34 12 46 Schedule Activi Timeline Oen Escrow No later than April 30, 2010 Close Escrow May 31, 2010 Cantron Very Low Income Households on 71 units August 31, 2010 Legal Description THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF FRESNO, COUNTY OF FRESNO, STATE OF CALIFORNIA. AND IS DESCRIBED AS FOLLOWS: Lots 1, 2, 3, 0 and 5 of Tract No 1938, Huntington Holmes Park, In Ne CNy of Fresno, County of Fresno, Stats of California, according to the map thereof recorded Aprll 26 19631n Volume 21 Pages 66, 67 and 68 of Plans, Fresno County Records. Excepting therefrom all oil, gas, other hydrocarbon substances and minerels of any kind or character, In, on, or thereunder, as reserved in deeds of record. APN: 488-390-04s 36 EXHIBIT B EXEMPLAR DECLARATION OF RESTRICTIONS BY AND far tee named 0 a recoming fee In awash win Cover Code 6attoo s 6103 and 29383. AND WHEN RECORDED MAIL TO'. CITY OF FRESNO Housing and Community Development Dinedon 2600 Fresno skeet, Room 3010 Fresno. CA 84121 TiYe Order No. Escrow No APN: 468391 DECLARATION OF RESTRICTIONS THIS DECIARATION OF RESTRICTIONS, ('Declaration'), is executed as of this by l—("Declarant"), or assignees, in favor of the City of Fresno, acting by and through its Planning and Development Department, Housing and Community Development Division ("City'). WHEREAS, Decrement is the owner of the real estate in the county of Fresno, state of California, consisting of Al 468-39044s, which is more particularly described In Exhibit "A", attached hereto and made a part hereof (the "Property" ); and WHEREAS, Pursuant to a certain Neighborhood Stabilization Program Agreement dated , 2010, Incorporated herein, ("NSP Agreement") and instruments referenced therein. Declamnl agrees to utilize and City agrees to provide certain NSP Funds from the United States Department of Housing and Urban Development, to Declarant for certain affordable housing (the "Project") upon the Property to be rented and maintained as affordable W very low income families, subject to me terms and Conditions set forth In the NSP Agreement) and WHEREAS, me NSP regulations promulgated by HUD, and me NSP Agreement impose certain affordability requirements upon property benefited thereby, which affordability restrictions shall be enforceable for a fifty five (55) year period; and WHEREAS, these restrictions are Intended to bind all purchasers and their successors. NOW THEREFORE, Declarant dedares that the Project upon the Property Is held and will be held transferred, encumbered, used, sold, Conveyed and occupied 37 subject to Me 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 acquisition, rental and occupancy of the Property. All of the restrictions, covenants and limitations will run with Me land and will be binding on all parties having or acquiring any right, titre or interest in the Project upon the Property or any part thereof, will inure to the benefit of he future Owners of the Property or any part thereof, the United States arm 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 Me Project Property, by accepting a deed or a contact of sale or agreement of purchase, accepts Me 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 fifty five (55) years consenting the Affordability Period. Pencil of Affordability: The Neighborhood Stabilization Program requires the City to set periods of affordability as provided in NSP regulations. The minimum period of affordability for MIs program is fifty five (55 years), year one shall be the 12 -month period following issuance of the Certificate of Completion of he Project Property, whh each succeeding year beginning on Me anniversary thereof and ending 12 month hence, There will be no partial years. 1. Declarations. Declaant hereby declares that he Property is and shall be subject to the covenants and restrictions hereinafter set forth, all of which are declared W be in furtherance of the Project and the NSP Agreement, and are established and agreed upon for the purpose of enhancing and protecting the value. of Me Project Property and in consideration for City entering into Me NSP Agreement with Declarant. All terms not otherwise defined herein shall have the meaning started to such term In the NSP Agreement. 2, Restrictions. The following covenants and restrictions on the use and enjoyment of Me Project Property shall be in addition to any char 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 Me Property and be binding on any future owner's of the Project Property and inure to the benefit of and be enforceable by City. These covenants and restrictions are as follows: a. Detlarant for itself and its successors) on title covenants and agrees that It shall cause Me Project Property to be used as Affordable Housing for Me duration of Me Affordability Period. Declarant fuller agrees to file a recordable document setting forth the Project Completion Datefs) and the Affordability Period when determined by Me City. Unless otherwise prowded In Me NSP Agreement, the term Affordable Housing shall include, without limitation, compliance with the following requirements: Nondiscrimination. There shall be no discirmination against nor segregation of any person or gmup of persons on account of race, color, creed. religion. sez, residual status, national origin, ancestry, or handicap in Me sale, transfer, use, occupancy, tenure, or enjoyment of any of the Project Property, nor shall Declarant or KIT any person claiming under the Declarant, establish or permit any practice of discrimination or segregation with reference to Me selection, location, number, use or occupancy of owners or veranda of Me Project Property. Principal Residence. Each unit constituting the Project cinch Me Property shall be rented only to natural perm who shall occupy the Unit as the principal residence. The foregoing requirement that the tenant of each Unit constituting the Project Property occupy Me Unit as the tenant's principal residence does not apply to persons, other than natural persons, who acquire Me Project Property or portion thereof by foreclosure or deed in lieu of foreclosure', or (it) HUD qualified entities that acquire the Project Property or potion thereof, with the consent of the City. Income Requirements. The NSP funded units constituting the Project upon Me Property and each of them may be rented only to (a) natural persons) whose annual household Income at Me time Is not greater Man fifty percent (50%) of the most recent annual median income calculated and published by HUD for the Fresno Metropolitan Statistical Area applicable N such household's size. A total of seventy one (71) floating units are NSP funded units. 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 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 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 Met would avoid the termination of affordability. However, the requirements wgh rasped to Afordable Housing shall be revived according to their original terms, if during the original Affordability Period the owner of record before he foreclosure or other transfer, or any entity that includes Me former owner or those with whom the former owner has or had formerly, family or 39 business ties, oblains an ownership interest in the Project or the Property, and the Affordability Period shall be revived according to its original terms. 5. Benefit. This Declaration shall run with and bind the seventy one (71) Pmject Units for a term commencing on the date this Declaration is recorded in the Office of Me Recorder of the county Fresno, state of California, and expiring upon Me expiration of the Affordability Period. The failure or delay at any time of City or any other parson entitled to enforce this Declaration shell in no event be deemed a waiver of the same, or of Me right to enforce the same at any time or fmm time to time thereafter, or an estoppel against Me enforcement thereof 6. Costs and Attomey'sFees. In any proceeding arising because of failure of Declarant or any future owner of the Project Property to comply with the Covenant and Restrictions required by this Occidenta , as may be amended from time In time, City shell 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 Property may exempt itself from liability for failure to comply with the Covenant and Restrictions required in this Declaration. B. Severabilly. The Invalidity of Me Covenant and Restrictions or any other covenant, restriction, condition, limitation, or other provision of this Dedamlion shall not Impair or affect in any manner the validity, enforceability, or effect of Me rest of his Declaration and each shall be enforceable to the greatest extent permitted by law. 9. Pronouns. Any reference to Me masculine. feminine, or neuter gender herein shall, unless Me context clearly requires the company, be deemed to refer to and include ail gantlets. 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 he 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 Me Office of the Recorder of county of Fresno, State of California. 13, Capital¢ed Terms. All capitalized terms used in this Declaration, unless otherwise defined herein, shall have the meanings assigned to such terms in that certain NSP Agreement by and between Dedarant and City, of even date, IE 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 Restric ions on the date first written above. "DECLARANT' FRESNO REVITALIZATION CORPORATION a California non-profit public benefit corporation Date' Date: Exhibit C NBP Budget and Cash Flow Use NBP Amount Private Financia uisition $2460,204 $1,937,796 Rehabllitatlon and Closin Costs $292,49 0 Total $2,772,253 $1,937,796 42 Operating Pro Fomes Pro Fortna Mo nVil Pro Forma Annual RENTALINCOME GROSS RESIDENTIAL RENT 65,95000 ]91,400.70 LESSVACANCY ADJUSTMENTS ss. EFFECTIVE GROSS INCOME (EGI) 59,3550 71226000 OPERATING EXPENSES PAYROLL EXPENSES ON-SITE MANAGER _4,166.67 (WQMC0 PAYROLL EXPENSES ON-SITE MAINTENANCE 2.]166] 32,60000 ADMIN EXPENSES (NET OF MGMT FEE) I1229,1. 14.750.00 MANAGEMENT FEES (4% of EGIU 2.3]4.20 28,490 40 %ARKETINGIRETENTION 118000 {14_160.00 MAINTENANCE B REPAIR 295G00 35400.00 TURNOVER EXPENSES .1.966.6] 23,600.00 UTILITIES 643258 (77 191M) RESERVES FOR REPLACEMENT'-: II ,6] 23 0.00 INSURANCE 2,500.00 30,00000 PROPERTY TAXES'. ". 174. TOTAL OPERATING EXPENSES 31657 121 J379�BIX 4 NET OPERATING INCOME 2] 69] 89 332,3]4.60 INTEREST EXPENSE 123 NET INCOMEICASH FLOW $17,44371 5209,324.55 43 Exhibit D EXEMPLAR CERTIFICATE OF COMPLETION RECORDED AT THE REQUEST OF AND WHEN RECORDED RETURN TO, City of Fresno Housing Division 16M Fresno Steel, Room 309D Freeno. CA 93731 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. APN-06&390-04s City of Fresno By: , Director Planning and Development Department Data CERTIFICATE OF COMPLETION L1NJ Rel A. By a Neighborhood Stabilization Program Agreement dated 2010, ("NSP Agreement") between the City of Fresno, a municipal corporation (`CITY"), and a California Corporation, (`DEVELOPER'), the DEVELOPER agreed to acquire a one hundred eighteen (118) unit multi -family rental housing project ("Project"), upon the premises legally described! in Exhibit A, attached to Me NSP Agreement, made a part hereof my this reference, (the "Propedy"), for the purposes of Affordable Rental Housing, with the assistance of NSP funds white meeting Me affordable housing, Income targeting and other requirements of the NSP, according to the terms and conditions of the NSP Agreement and the Loan Documents and other documentlnstruments referenced therein. S. The NSP Agreement or a memorandum of It was recorded on 2010 as Instrument No, in the Oficial Records of Fresno County, California C. Under Me terms of the NSP Agreement, after the DEVELOPER completes the Project, the DEVELOPER may ask CITY to record a Certificate of Completion. D. The DEVELOPER has asked CITY to furnish the DEVELOPER with recordable Certificate of Completion. E. The CITY's issuance of this Certificate of Completion is conclusive evidence that the DEVELOPER has completed construction of Me Property as set forth in the NSP Agreement. NOW THEREFORE: 1. CITY certifies that the DEVELOPER commenced the Project on the Project Property on 2010 and completed the Project on Me Project Property on 2010, and has done so In full compliance with Me NSP Agreement. 2. This Certificate of Completion is not evidence of the DEVELOPER compliance with, or satisfaction of any obligation to any mortgage or security interest holder, or any mortgage or security Interest Insurer, securing money lent to finance work on Me Property or Project, or any part of the Property or Project. 3. This Certificate of Completion is not a notice of completion as referred to in California Civil Code Section 3093. 4. Nothing contained herein modifies any provision of the NSP Agreement. IN WITNESS WHEREOF, CITY has executed this Certificate of Completion as of this day of 20_ CITV OF FRESNO By: Director Planning and Development Department ATTEST: APPROVED AS TO FORM: CITY CLERK JAMES C. SANCHEZ BY: By: Deputy Deputy Date. Date! CONSENT OF DEVELOPER FRESNO REVITALIZATION CORPORATION By signing below, the owners) of the property consent(s) to recon ing this Certificate of Completion against she Property described herein. V=1h muyunin®ie or ld,m 'wq IAaem munoexnfaueraw smn�l Exhibit E EXEMPLAR PROMISSORY NOTE (Program: Neighborhood Stabilization Program) DO NOT DESTROY THIS NOTE: When paid, this nate must be surrendered to Borrower for Cancellation. 12,772,253 Fresno, Criticisms, _, 2010 Promise to Pay. For value received, the undersigned, a California Company ("Developer" or "Borrower'), promises to pay to the most of the City of Fresno, a California municipal corporation, ('Lender'), the sum of Two Million Seven Hundred Seventy Two Thousand Two Hundred Fifty Three Dollars and DWI ($2,]]2,253.00) at zero percent interest, due and payable at the earlier of (i) 55 years tram the City Issued Gertificate of Completion (the Affordability Period) or (it) the date upon which the Borrower has completed payment on other property acquisition liable). On or before the earliest of (i) or (it) above (Me "Maturity Date'), and pursuant to the parties' Neighborhood Stabilization Program Agreement dated , 2010 ("NSP Agreement"), on which date Me unpaid principal balance together with interest and unpaid penalties or late charges where applicable thereon shall be due and payable In a lump sum, along with attorney's fees and costs of collection, without relief tram valuation and appraisement laws; provided Mat, in the event the Developer is not then In default of the NSP Agreement, the Developer may at any time pay off the principal prior to the Maturity Date. If, upon sale of the Project Property, by Borrower, and the repayment of the Note associated with the First Deed of Trust, there are Inadequate proceeds to pay Lender Me full principal and interest due under this Promissory Note solely More the proceeds of the sale, Lender shall accept such payment from Borrower as full repayment of all unpaid principal due without any further recourse to Sommer. Any failure to make a payment required hereunder shall constitute a default under this Nate. Definitions. All capitalized terms used in this Note, unless otherwise caflned, will have Me respective meanings specified in the NSP Agreement. Business Dov 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, Mat payment may be made on Me next succeeding Business Day. However, if Me extension would rause the payment to be made in a new calendar month, that payment will be made on the neat preceding Business Day. Afiordabitty Peyotl The minimum period of affordability for this Program Is fifty five (55) years. Year one shall be the 12 -month period following issuance of me Certificate of 47 Completion for the Project with each succeeding year beginning on to anniversary Mereof and ending 12 month hence. There will be no partial years. Securay. Lender, by any and all UCC -1 Financing Statements) filed, may perfect Lender's security Interest in this Note, the NSP Agreement, and any extensions or renewals hereof, and any and all accounts, chattel paper, payment intangibles, or promissory notes. Time is of the Essence. It will be a default under this Note if Borrower defaults under Me NSP Agreement, defaults under any other Program documents, or If Borrower fails M pay when due any sum payable under this Note, In the event of a default by Borrower, the Borrower shall pay a late charge equal to the lesser of 2% of any outstanding payment or the maximum amount allowed by law. All payments collected shall be applied first to payment of any costs, tees or other charges due under this Note or any other Program documents and then to principal balance. On the occurrence of a default or on the occurrence of any other event that under the terms of the Ivan documents give rise to the fight to accelerate Me balance of the indebtedness, then, at Me option of Lender, this Nota or any notes or other instruments that may be taken In renewal or extension of all or any pad of the indebtedness will immediately become due without any further presentment, demand, protest, or notice of any kind. Terms of Payment The Indebtedness portended by this Note may, at the option of Me Borrower, be prepaid in whole or In pad without penalty. Lender will apply all the prepayments let to the payment of any costs, fees, late charges, or other charges due under this Note or under any of Me other Program documents and Men to Me principal balance. All Loan payments are payable in lawful money of the United 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 Me absence of Mat designation, to'. City of Fresno — Finance Department FinanceFTreasury Section 2600 Fresno Street, Room 2156 Fresno, CA 93721 Borrower agrees 10 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 casts, attorney fees, and expenses incurred by the holder of this Note in connecfion 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 induced In those costs and expenses to be paid by Borrower, Borrower will pay to Lender all attorney fees and other costs referred to M this paragraph on demand. CE Any notice, demand, or request relating to any matter set forth herein shall be In writing and shall be given as provided In the NSP Agreement. No delay or omission of Lender In exercising any right m power arising in connection with any default will be construed as a waiver or as acquiescence, nor will any single or partial exercise preclude any further exercise. Lentler may waive any of the ounditlgns in this Note and no waiver will be deemed to be a waiver of Lenders rights under this Note, but rather will be deemed to have been made in pursuance of this Nota and not in modification. No waiver of any default will be consented b be a waiver of or acquiescence in or consent to any preceding or subsequent default. Tames of Security Instruments The Dead of Trust securing this note shall provide as follows: DUE ON SALE—CONSENT 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 of all or any portion of the Property, or any Interest therein, without the Beneficiary's prior consent. A "sale or transfermeans the conveyance of the Property or any right, title or interest thereiq 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, leaseaption 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 land interest. If any Trustor is a corporation, partnership or limited Ilabllity, 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. Assignment by Lender. Lender may transfer this Note and deliver to the transferee all or any pad of the collateral then held by It as security under this Note, and the transferee will Oren became vested with all the powers and rights given to Lender, and Lender will then be forever relieved from any liability or responsibility in me matter, but Lender will retain all rights and powers given by this Note with respect to collateral not harshened. Enforceability. If any one or more of the provisions in this Nota 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. Governing Law. Borrower agrees that this Note will be deemed to have been made under and will be governed by the laws of Califomla In all respects, Including matters of construction, validity, and performance, and that none of its terms or provisions may be E waived, altered, modified, or amended except as Lender may consent to. in a writing duly sign" by Lender or Its authorized agents. In witness whereof, Borrower has caused this Note to be executed by IN Authorized agent as of the dale and year first above written. Fresno Revitalization C rporatiaq Borrower By: Data Name: Title'. (Allach notary mNfcab of acknowledgmane Exhibit F DISCLOSURE OF CONFLICT OF INTEREST Name: J ndderit The: � resident YES' NO 1. Are you currently in Iltigadon with the City of Fresno or any of its agents? 2. Do you represent any firm, organization or person who is In litigation with the City of Fresno? � 3. Do you currently represent or perform work for any clients who do business with the City of Fresno? ✓ 4. Are you or any of your principals, managers or professionals, owners or investors in a business which does business with ✓ the City, or in a business which Is in litigation with the City? 5. Are you or any of your principals, managers or professionals, related by blood or marriage to any City employee who has any significant role in the subject matter of one service? 6. 1 Am you employed by any other jurisdictions or agencies? ✓ It the answer to any question Is yes, please explain In full. Name: J ndderit The: � resident EXHIBIT G Appraisal Requirements The Uniform Relocation Assistance and Real Property Acquisition Policies Act (URA) and Its implementing regulations (49 CFR Part 24) set foM minimum requirements for real property acquisition appraisals for Federal and federallyassistedprograms. Appraisals subject to the URA must be prepared according to these requirements. The acquiring DEVELOPER has a legitimate role In contributing to to appraisal process, especially In developing ascope of work and defining the appraisal task. The scope of work and development of an appraisal under these requirements depends on Me complexity of the appraisal task. The scope of work is a written set of expectations that form an agreement or understanding between Me appraiser and the DEVELOPER as to the specific requirements of the appraisal, resulting In a report to be delivered to the DEVELOPER by the appraiser. The scope of work must address the unique, unusual and variable appraisal performance requirements of the appraisal. Either the appraiser or the DEVELOPER may recommend modifications to Me initial scope of work, but both parties must approve changes. SCOPE OF WORK The appraiser must, at a minimum'. I . Provide an appraisal meeting the definition of an appraisal found at 49 CFR 24 2(a)(3) which is a written statement independently and Impartially prepared by a qualified appraiser setting forth an opinion of defined value of an adequately described property as of a specific date, supported by the presentation and analysis of relevant market Information. 2. Afford the property owner or Me owner's designated representative the opportunity to accompany the appraiser on the inspection of the property. 3. Perform an inspection of the subject property. The Inspection should be appropriate for the appraisal task, and the scope of work should address: • The extent of the inspection and description ofthe neighborhood and proposed project area, • The extent of Me subject property Inspection, including interior and exterior areas, • The level of detail of Me description of the physical charactenstcs of the property being appraised (and, in the case of a petal acquisition, the remaining property.) 52 4. The appraisal must have been completed within 60 days of the offer made for the property. 5. The acquiring DEVELOPER has the responsibility to assure that the appraisals it obtains are relevant to Re program needs, reflect established and commonly accepted Federal and federally -assisted program appraisal practice, and as a minimum, complies with the definition of appraisal stated above and the five following requirements:. (i) An adequate description of the physical characteristics of the property being appraised including items Identified as personal property, a statement of the known and observed encumbrances, if any, title information, location, zoning, present use, an analysis of highest and best use, and at least a 5 -year sales history of the property. (ii) All relevant and reliable approaches to value consistent with established Federal and federallyassistedprogram appraisal practices. If the appraiser uses more than one approach, there shall be an analysis and recondliation of approaches to value used that Is suffident to support the appraisers opinion of value. (til) A description of comparable sales, including a description of all relevant physical, legal and economic factors such as parties to the transaction, source and method of financing and verification by a party involved in the transaction. (iv) A statement of the value of me real property to be acquired and, for a partial acquisition, a statement of the value of the damages and benefits, if any, b the remaining real property, where appropriate. (v) The effective date of the valuation, date of appraisal, signature, and certification of the appraiser (see attached sample). 6. The appraiser shall disregard any decrease or Increase in the fair market value of the real property caused by the project for which the property is to be acquired or by the likelihood that the property would be acquired for the project, other than that due to physical deterioration within the reasonable control of the owner. 53 CERTIFICATE OF APPRAISER I hereby certify That on datefs), I personally made a fleld inspection of the property herein appraised and have afforded the owner or a designated representative Me opportunity to accompany me on this inspection. 1 have also personally made a field inspection of the cr mparable sales relied upon in making said appraisal. The property being appraised and the comparable sales relied upon in making this appraisal were as represented In the appraisal. That to the best of my knowledge and belief the statements contained in Me appraisal herein net form are We, and Me Information upon which the opinions expressed therein are based is coned; subject to the limiting conditions therein set forth. That I understand that such appraisal may ba used In connection with the acquisition of property for a pmject utilizing U.S. Department of Housing and Urban Development funds. That such appraisal has been made in conformity wRh appropriate laws, regulations, and policies and procedures applicable to appraisal of property for such purposes', and that to the best of my knowledge no portion of the value assigned to such property consists of items which are noncompensable under Me established law of said State. That any decrease or increase in the fair market value of real property prior to the date of valuation caused by Me project for which such property is acquired, or by Me likelihood that the property would be acquired for such project, other than that due to physical deterioration within Me reasonable control of the owner, was disregarded In determining the compensation for the property, That rather my employment nor my compensation for making this appraisal and report are in any way contingent upon Me values reported herein. That I have no direct or indirect present or contemplated future personal interest in such property or in any benefit from the acquisition of such property appraised. That I have not revealed the findings and results of such appraisal to anyone other Man to proper officials of the acquiring DEVELOPER or officials of the U.S. Department of Housing and Urban Development and I will not do so until so authorized by said officials, or until I am required to do so by due process of law, or until I am released from this obligation by having publicly testified as to such findings. That I have not given consideration to, or included In my appraisal, any allowance for relocation assistance benefits. 54 That my opinion of the fair market value of the. property to be acquired as of is $ based upon my independent appraisal and the exercise of my professional judgment. Name Signature Date 55 OPERATING AGREEMENT AND LOAN GUARANTY by and between Redevelopment Agency of the City of Fresno, a public body, corporate and politic and FRESNO REVITALIZATION CORPORATION, a California Non -Profit Public Benefit Corporation regarding Canyon Crest Condominiums (A Multi -Family Rental Apartment Property) ATTACHMENTS Exhibit A: Legal Description of Property Exhibit B: Plat Map of the Property Exhibit C: Budget/Financial Plan Exhibit D: Certificate of Completion Exhibit E: Basic Program of Wort: Exhibit F: Regulatory Agreement Exhibit G: Loan Guaranty Exhibit H: Agreement for Purchase and Sale of Real Property Exhibit I: Neighborhood Stabilization Program Agreement Exhibit I Seller's Loan Documents Exhibit K: Contractual Services Agreement between RDA and OWNER Pagel THIS OPERATING AGREEMENT ('Agreement) is entered as of the Effective Date (defined in this Agreement), between Me REDEVELOPMENT AGENCY OF THE CITY OF FRESNO, a public body, corporate and politic, ("Ageri and Me FRESNO REVITALIZATION CORPORATION, a California Non -Profit Public Benefit Corporation ("Owner) RECITALS The partes enter this Agreement based on the following fads, understandings, and Intentions: A. By authority granted under Plromi Redevelopment Law (the "taw'), Me Agency has prepared and Is responsible for carrying out Me redevelopment plan for certain Redevelopment Project Areas (Me'Plan'), including as k certain prienty of use of Tax Increment antler Housing Set Aside Funds (collectively'Tax Increment.) B. To Me extent provided in or allowed by the Lew including California Health and Safety Code ('Cal. H& S.C.") Sections 33334.2 and 33449, as prodded by joint resolutions of the Fresno City Council antl the Agency, finings and determinations pursuant to Cal. H&S.C. Section 33334.2(8), Me Plan and limited to the terms and conditions therein, Me Agency may make improvements upon and/or consWd and improve structures In order to provide housing for persons and families of low or moderate income, including related on-site and offals Improvements, by venously: (1) allowing the use of Housing Set Aside Funds outside Me Airport Area ReOlodzation, Central Business District Central City Commercial Reviklimtion, Chinatown Expanded, Convention Center, Freeway 99Golden State Boulevard Condor, FriVChuroh, Mariposa, Reeding Business Park, South Fresno Industrial Revitalization, South Van Ness Industrial, Southeast Fresno Revitalization, West Fresno I, West Fresno II, West Fresno It redevelopment plans) (2) resNctirg the use of the Housing Sal Aside Funds to cookie of the Community Development Block Grant eligible areas of the City, and (3) placing a plenty on the use of the Housing Set Aside Funds from certain Project Areas to be used either within or adjacent to Me Central Area or adjacent to careen Project Areas. C. Agency administers the Low and Moderate Income Housing Fund established pursuant to Cal. H& S.C. Sections 33334.2 at seq. D. Purer is a California Non -Profit Public Benefit Corporation, exempt hem federal and state Income tax under Section 501 e(3) of Me Internal Revenue Code and Section 23701(d) of Me Calffomla Revenue B Taxation Code for me, purpose of assisting the Agency with revitalization of Me downtown area of Fresno, California. E Owner shall acquire all rights, title an Interest in fee to Me basin real properly deserted in Exhibit "A' attached hereto antl Incorporated hares (Me "Properly ). The Property is located adjacent lothe Cental Area and within Me ternithrlal jurisdiction of Me Agency for the use of Housing Sol Aside Funds. Page E Owner proposes to acquire a multifamily residential project on the Property, nsimirg of one hundred eighteen (118) resicambal units, wherein one hundred seventeen (117) units shall be rented to very low and lower income househmlds. G. Owner proposes to enter an Agreement with the City of Fresno whereby the City shall make a loan to Owner from its Neighborhood Stabilization Program ('NSP') in the amount of $2,A2,253 b Owner for acquisition and renovation of the Property under the terms and conditions of Net NSP Agreement, attached hereto as Exhibit -I* to this Agreement. H. Owner agrees to undertake Improvements to the Property in accordance with the Basic Program of Work described In Exhibit °E" attached hereto and incorporated herein (the 'Basic Program of Wmrk'j, 1, The Property and associated on site and off site improvements are collectively Wanted to in this Agreement as the 'Improvements' or this °Property; all of which will directly benefit the Property and the Plan Area. J. Agency is willing to assist Owner's acqulai8on of the of the Property by providing a Loan Guaranty to Owner through the use of certain Housing Set Aside (Tax Increment) Funds In an amount of One Million, Nine Hundred Thirty -Seven Thousand, Seven Hundred Nini Dollars ($1.937.7W.00)(Bre 'Agency Guaranty') upon the terms and conditions specified in Nis Agreement and provide administrative, financial and technical support to the Owner in the acouisirl and operation of the Property. N. The Agency Loan Guaranty shall be made in accordance with this Agreement. The Agency Guaranty and performance of the affordability and other covenants and restrictions set forth in this Agreement shall be evidenced by a Regulatory Agreement shown In Exhibit 'Fto this Agreement and which shall be recorded against and con will the Property. L. The Housing and Community Development Commission reviewed the Property and this Agreement on February 24, 2010, and recommended Met the City Council and Agency Board approve IL M. The Agency Boats reviewed and approved the Property and this Agreement on April 8, 2010. N. The Project has been environmentally assessed (Environmental Assessment No. H-2010-10) and was determined to be categorically excludetl from review under Section 5835 (a)(3) II and (a)(5) of the National Environmental Policy Act (NEPA) Guidelines. Additionally, the Project hes. been assessed under the CaHomia Environmental Quality Act (CEPA), resulting in a Categorical Exemption. Based on the review, City slag determined that the project is consistent with all of the chane specRed for an exemption to CEQA in accordance with Section 15301/Class 1 and 15378(6)(4) of CEOA Guidelines. O. Agency hes further determined this Project is in the best interests of, and will matemey contribute b, Plan implementation. Further, Agency has found the Project (i) will have a positive influence in the Plan Area, and surrounding environs, (ii) is in the vital and best interests of Agency and the heats, safety, and welfare of City residents; (Iii) complies with applicable federal, slate, and local laws and requirements; (iv) will help eliminate bllghl; (v) will improve and preserve the community's supply of low and moderate income housing available at affordable rent, as defined by Cal. H.& S.C. Section 50053, to persons and families of low or moderate Income, as refract in Cal. H.& S.C. Section 50093: (vi) will be available to meet the replacement housing provisions In Cal. HA S.C. Section 33413; (vii) will apply funds solely within the respective Plan areas except to the extant otrmrwiae provided herein and allowed by Law; (viii) includes only planning and administrafve expenses Incurred in pureult hereof that are necessary for the production, improvement, or preservafon of low and moderate income housing: (x) will comply with all owner participation rules and otters of Agency and the Plan; and (x) will comply with any and all applicable review and other requirements of the City's Historical Preservation Ordinance. AGREEMENT NOW, THEREFORE, in consideration of the foregoing and the covenants, conditions and promises hereinafter contained to be kept and performed by the respective pares, it is mutually agreed as follows'. 1. DEFINITIONS. Besides definitions container! elsewhere In this Agreement, the definitions in this Section will govern fire construction, meaning, application and Interprelabon of the various terms used in this Agreement 1.1. 'ADA" means the Americans with Disabilless Act of 1990. 1.2. "Affordability Pared means a period of fifty-five (55) were commencing from the date Agency records gree Certificate of Completion, shown in Ex1ribil'D' to this Agreement. 1.3. 'Affordable Very Low Income Rerd" shall mean annual rentals (not including a reasonable utility allowance) whose amount does not exceed the maximum percentage M income that can be devotetl to rent as set forth by the U.S. Department of Housing and Urban Development ("HUD"), or Its successor, which is cuff entry thirty-five percent (35%) of fifty percent (50%) of the annual median Income for the Fresno Metropolitan Statistical Areas adjusted for the family size appropriate for the Unit. 1.4. 'Affordable Lower Income Reny shall mean annual rentals (including a reasonable Utility Allowance) whose amount does not exceed the maximum percentage of Income that can be devoted to rent as sat forth by Callfomia Health & Safety Corte Section 50053 (b)(3), or its successor. which is currently thirty percent (30%) of sixty pement (60%) of the annual median Income for the Fresno Metropolitan Statistical Area adjusted! for the family size approprate for the Unit 1.5. 'Affordable Rent" shall refer to Affordable Vary Low Income Rent act Affordable Lower Income Rent. Page 5 1.6. 'Agency' means the Redevelopment Agency of the Cry of Fresno, a public hotly, corporate and politic, oryanized and existing under the California Health 8 Safety Cape Section 33000 at seq., and any assignee of or successor to IN rights, powers and responsibilities. 1.7 'Agency Assistance' shall mean the Agency Loan Guaranty as defined In Section IS below, as well as any Agency Tax Increment or Low and Moderate Income Set -Aside funds used to cover debt service shortfalls or for Agency4unded capital improvements to the Project. 18. 'Agency Loan GuaanV means a loan guaranty of a promissory note by an afiliate of the Properly Seller. Inland Mortgage Capital Corporation, In an amount of One Million, Nine Hundred Thirty -Seven Thousand, Seven Hundred Ninety -Six Dollars ($1,937,796.00) made by Agency to Owner as a contribution towards the Project, upon the terms and conditions set forth in tine Agreement and the Loan Guaranty shown in Exhibit "G' of this Agreement. 1.9. -Agreement' means this Operating Agreement, including all agreements shown In the exhibits and mounted by reference. 1.10. 'Budget' means the BudgeVRnandal Plan for the Property attached hereto and incorporated herein as Exhibit 'C' (me'BudgeF). 1.11. 'Ceriitiwle of Completion' means that Ceriffate issued in the fans attached as Exhibit -D' to Owner by Agency evidencing completion of the Prop" for Purposes of this Agreement 1.12. 'City of Fresno' or 'City' shall mean the City of Fresno, California, a Charter City. 1.13. 'Community Development Block Program' refers to the program of the United States Department of Housing and Urban Development('HUD'), of which the Neighborhood Stabillrabon Program Is a subcomponent, enacted under Title I of the Housing and Community Development Act of 1974. 1.14. "Day' whether or not capifallzed, means a calendar day, unless stated otherwise. 1.15. "Eligible Very Low Income Tenant' shall mean those tenants whose household Incomes do not exceed fifty percent (50%) of the annual median income for Me Fresno Metropoilran Speediest Area, 1.16. 'Eligible Lower Income Tenant' shall mean those tenants whose household Incomes do her exceed eighty percent (80%) of the annual median income for the Fresno Metropolltan Statistical Area. 1.17. 'Eligible Over Income Tenant' shall mean those tenants whose occupancy at the Property precedes the aceuisition of the Property by Owner and the recordation of these Restrictions, but whose household incomes exceed eighty percent (80%) of the annual median income for Me Fresno Metropolitan StatisBcal Area for Me household size, and which household the Owner has determined would be Infeasible to relocate under the Federal Uniform Relocation Act ('UW), 49 CFR Pad 24 or HUD Regulations Section 104(d). 1.18. "Eligible Tenant' shall mean a Very Low Income Tenant or a Lower Income Tenant An Eligible Mar Income Tenant is an Eligible Tenant. 1.18. 'Fresno Metropolitan Statistical Area Median Income' shall be determined by reference to the calculattons published by HUD, 1.20. 'Default' means a party's failure to timely perform any action or covenant required by this Agreement following notice and opportunity to cure. 1.21. "Direclof means the Executive Director of Agency. 1.22. "Effective Date" means the date of complete execution of the Agreement following the Agency Board approval thereof. 1.23. 'Environmental laws' means any federalstate, or local law, statute, ordinance or regulation pertaining to environmental regulation, contamination or cleanup of any Hazardous Materials or waste Including, without limitation, any state or federal lien or 'super lien" law, any environmental cleanup statute or regulation, or any governmentally required permit, approval, authorisation. license, venance or permission. 124; 'Funding Source' means the loan made to the Owner by Me City of Fresno ('NSP Loan') and the sellers note made by Inland Mortgage Capital Corporation, ("Seller's Nota') along with any Agency Assistance and other funding sources secured by Owner to acquire, operate or renovate the Improvements as shown In Exhibit -C.- 1,25 CJ1.25. 'Finandmg Plan' means the Budget Including seurces and uses of funds sufficient for Owner to acquire, operate or renovate Improvements according to the Basic Program of Work as described In Exhibit -L' 1.26. 'Hazardous Materials' means any substance, material, or waste which Is or becomes regulated by any Iacal govemmental authority, the State of California, or the Unded States Govemment including, without limitation, any material or substance which is. (a) defined as a "hazardous waii 'extremely hazardous waste; or 'restneted hazardous waste" under Sections 25115. 25117, or 25122 7, or listed pursuant to Section 25140 of the California Health and Safety Code; (b) defined as a 'hazardous substance' under Sestion 25316 of the California Health and Safety Code, (c) defined as a 'hazardous material; 'hazardous substance,' or 'hazardous waste' under Section 25501 of Me Calrfomia Health and Safety Code; (d) defined as a 'hazardous substance" under Section 25281 of the California Health and Safety Cope; (a) petroleum; (1) friable asbestos: (g) Folychlonnoted byphenyla; (b) listed under Artlde 9 or defined as 'hazardous or "extremely hazardous' under Article 11 of This, P,d, 7 22, California Administrative Code; (i) designated as 'hazardaus substances' pursuant to Section 311 of the Clean Water Act (33 U.S.C. §1317), 0) tallest as a "hazardous waste" pursuant to Section 1004 of the Resource Conservation and Recovery Act (42 US.0 §6901 at ser.); or, (k) darned as 'hazardous substances' pursuant to Section of the Comprehensive Environmental Response, Compenswein, and Liability Act (42 US.C. §%01, of seq); provided, however hazamous materials shall not include: (1) construction materials, gardening molenals, household products, ogre supply products or janitorial supply products customarily used In the construction, maintenance, rehabillumon, or management of residential rental housing or associated buildings and grounds, or typically used in household activities, in a manner typical of other residential rental housing developments which are comparable to the Improvements; and (2) certain substances which may contain chemicals listed by the State of California pursuant to Health and Safety Coda Sections 25249.6 at seq., which substances are commonly used by a significant portion of the poplation Irving within be region of the PropdY, including, but not limited to, alcoholic beverages, poorly, tobacco products, NubaSweet and saccharine. 1.27. 'Household" means one or more persons occupying a Unit 1.26. 'Housing Set -Aside Funds" means those California Health and Safety Code Section 33334.2 monies held and administered by Agency, a portion of which shall be used m provide the Loan Guaranty to Owner for eligible costs and expenses incurred by Owner in acquiring and renovating the Improvements in such amounts, and upon such terms and conditions specified in this Agreement. 1.29. 'Improvements' mean the Units Gainer will acquire, operate and renovate on the Property. Including associated fencing, pools, recreation areas, palling lots, and landscaping Improvements - 1 30. 'Initial Leasesi Period' The period of lime after Owner has closed escrow on the Property from Sellar and undertakes (a) the leasing of uncant units to Income-quall0etl households; (b) the leasing of the si its requiring significant renovation and rehabilitation; and (c) the Process of income -qualifying existing tenants living at the Property. The Parties expect the lnitel Lease -up Penatl to he complete by September 30 2010. 1.31. "Law- means the Community Redevelopment low of the state (Celtomis Health and Safety Code Sections 33000 at seq.) 1.32. 'Loan Documents" means collectively Nis Agreement, Me Sepses Note. the NSP Agreement, the Loan Guaranty Agreement, the Goods of Trust, and all exhibits and attachments thereto as they may be amended modified or restated from time b time. 1.33. The term "Managers Unit' or 'Management Representative's Unif shall mean the one (1) unit of the Property Nat shall be designated by Owner 18 as a residence for a "Qualified Manager or 'Quell Management Representative" The Manager's Unit shall not be an income-rasttictetl Unit. 1.34. 'Material Change- means a change, moddical revision or alienation to the Loan Documents that significantly deviates from those previously approved by me Agency, provided that fully funded changes) which do not result in a change in the number or type (i.e. residential, affordable and commercial) of Units andlor an increase in the total Agency Assistance funding provoked! In his Agreement shall not constitute Material Change(s). 1.35. "Neighborhood Stabilization Program' or "NSP' shall mean a program administered by the City of Fresno resulting from he Congressional adoption of Title III of the Housing and Economic Recovery Act (HERR) of 2066. NSP is a subcomponent of the Community Development Block Grant Program (CDBG) administered by HUD and provides entitlement gran% to state and local communities to purchase foreclosed or abandoned property to rehabilitate, resell, or redevelop homes or multi. family units in an effort to stabilize neighborhoods and arrest the decline of house values In neighboring homes. 1.38. 'Cwwr" means Fresno Revitalization Corporation. Inc. a California Non - Profit Public Benefit Corporation. 1 3, "Plan" means the Redevelopment Plan for the Merged Project Area No, 1 Project Area. 1.38. 'Project means the acquisition of 118 residential units; the full renovation of no fewer then six (6) units; and associated public area improvements as more particularly described In Exhibit "E". Upon completion of the Project, Owner will implement an on-going program of unit upgrade upon vacancy. 1 39. "Project Area' means Merged Project Area No 1. 1,40. 'Project Completion Date' means the date that Agency shall have determined he Project has reached completion in accordance with the scope of work described in the Basic Program of Work attached as Exhibit 'P, as evidenced by Agency's tssuarwe of a Certificate of Completion, and shall be no later than July 31. 2010. 141 'Property' means the real property described in Exhibit "A'. 1.42_ The term 'Qualified Manager" shall mean the resida t Property Manager selected and retained by owner pursuant to he Regulatory Agreement. The Qualified Manager shall reside In he 'Manager's Unit" designated by Owner or shall designate one unit as a "Management Repesen%Ove s Unit" for an employee of Qualified Manager charged with on-site and after-hours duties. The Managers Unit shall be rermcted to occupancy by the Qualified Manager and their households, but shall not be subject to any income restriction. 143. 'Basic Program of WOW means the schedule attached as Exhibit 'E,' ening forth the dates and times by which the parties must acoompllsh certain obligations under this Agreement. The pages may revise the Basic Program of Work from time to time on mutual when agreement of Owner and Agency, but any delay or extension of the Completion Date Is subject to the requirements in this Agreement. 1.44. The term 'Regulatory Agreement" shall mean that Regulatory Agreement attached hereto as Exhibit "P, running with the land and prov ding for the proper maintenance of common facilities and Improvements and the management and use of Me Property and to ensure the Restricted Units remain affordable pursuant to Me terms of this Agreement. 1.45. "Release of Restrictions' means a release of those covenants, bandit and restrictions contained in this Agreement. 1.46. "Resthcted Units" shall refer to a total of ane hundred seventeen (117) units of which (a) seventy one (71) residential units shall be reserved for Eligible Very Low Income Tenants at rents not exceeding the Affordable Very Lary Income Rent; and, (b) forty-six (46) residential units shall be reserved for eligible Lower Income Tenants at rents not exceeding the Affordable Lower Income Rent; as more particularly described in Me Regulatory Agreement adached hereto as Exhibit -F- 1,47. F147. 'Security Financing Interest means a security interest which Owner grants in Me Property and rite Improvements "man before Me Agency issues and records a Release of Restrictions. 148. 'Sell shall mean IMCC Canyon Creat, LLC, a Delaware Unrest Uabilily Company. 1.49. "Unit", as used in this Agreement, shall refer to any of the one hundred eighteen (118) residential units in Me Property. 2. RESTRICTIONS UPON TRANSFER. Except as may be expressly provided herein, all of Me terms, covenants and conditions of this Agreement shall be binding on, and shall inure to the benefit of. Owner and Me permltled successors. assigns and nominees of Owner, Wherever the term'Cwner' is used herein, such teem shall Include any permitted successors and assigns of Owneras herein provided 2.1 Qualifications of Owner The qualifications and Identity of Owner e of particular concern to the Agency, particularly with the relationship between Owner and Agency, and it is because of such qualifications and identity that Agency has entered Into this Agreement with Owner. Based upon these consitlemtions, the Agency has imposed Mose restrictions on transfer set forth in Mis Agreement. Pep, 10 2:2 Restrictions on Tunisia . Prior to issuance of the Candidate of Completion, Owner shall not Transfer this Agreement or any of Owners rights hereunder, or any Interest in the Property or in the Improvements thereon, directly or indirectly, voluntarily or by opembon of law, except as provided below, without the prior written approval of Agency, and If so purported to be Trensfened, the same shall be null and void. In considering whether It will grant approval to any Transfer by Owner of its interest In the Property before the issuance of the Certificate of Completion, wMch Transfer manures Agency approval, Agency shall consider factors such as (i) whether me completion or implementation of the Project is jeopardized, (11) the financial strength and capability of the propoeed assignee to perform Cwners obligations hereunder; and (Iii) the proposed assignee's experience and expertise in the planning, financing, development. ownership, and operation of similar projects. In fall no attempted assignment of any d Owners obligations hereunder shall be effective unless and unfit the successor party executes and delivers to Agency an assumption agreement in a form approved by the Agency assuming such obligations. After the Issuance of a Certificate of Completion, the restrictions upon Transfer by Owner are contained In the Regulatory Agreement shown in Exhibit "F 2.3 Exceptions. The foregoing prohibition shall not apply to any of the following: a. Any mortgage, dead of Wst, or other form of conveyance for financing, as provided in barren 3, but Owner shall notify Agency In advance of any such mortgage, dead of bust or other form of conveyance for financing pertaining to the Property. b. Any mortgage, dead of twat, or other form of conveyance for restructuring or refinancing of any amount of Indebtedness depended in subsection (a) above, provided Nat the amount of indebtedness incurred in the restructuring or refinancing does not exceed the outstanding balance on the debt incurred to finance the acquisition or and the construction of the Improvements on the Property, Including any peripheral costs for completion of constnu on, whether direct or Indirect based upon the estimates of architects. and/or contractors. The granting of easements te any appropriate governmental agency or utility or permits to facilitate the development of the Pmperty. of A sale or transfer resulting from or In connection with a reonganiiatlon as contemplated by the previsions of the Internal Revenue Cotte of 1986, as amended or otherwise, in which the ownership interests of a corporation are assigned directly or by operation of law to a person or persons, firm or corporation which acquires the control of the voting capital stock of such corporation or all or substantially all of the assets or such corporation. Page 11 e. A sale or transfer between members of the same Immediate family, or Vansfers to a trust, testamentary or otherai In which the beneficial consist solely of immediate family members of the Trustor or hansfers to a corporation or partnership in which Me immediate family members or shareholders of the install have a controlling ma(odty interest of 51% or more. I. A sale or transfer to a Qualified Tax Credit Investor, provided that such Qualified Tax Credit Investor shall be In a non - managing rola g. A sale or transfer of general partner interests to a nonprofit general partner. In A sale or transfer of general partner interests to a nonprofit general partner. 2.4 Allowed Transfer. Owner may assign its ights, duties and obligations, His and Interest under I Agreement to a wholly owned single purpose subsidiary of Owner, subject to written approval by Agency. However, in the event of such assignment as provided herein. Owner Is in no way relieved of any of its responsibilities, and shall remain fully responsible and liable to Agency under Na all of this Agreement and all related agreements, and Owner shall retain full con"I and responsibility for the Project 3. ACQUISITION OF THE PROPERTY. The Property is currently owned by the Seller and was delainetl through a foreclosure process. Seller shall convey Me Property to Owner and Owner shall acquire the Property from Seller, upon the terms and conditions set forth in an Agreement for Purchase and Sale of Real Property between Seller and Owner, which form is included in Exhibit "H' of this Agreement The Agency has agreed to provide a Loan Guaranty of a Sellars Note to Owner for the acquisition of the Property In the amount of One Million. Nine Hundred Thirty Seven Thousand Seven Hundred Ninety,Slx Gonave ($1,937.791 The conveyance of the Property shall be by the form of a Grant Dead. Consideration for the Loan Guaranty shall be Me Performance of the forms and conditions of Ms Agreement Including the Regulatory Agreement shown in Exhibit "F" of this Agreement. In addition to Me Sellers Nate, Me Owner shall enter an Agreement with the City of Fresna ("NSP Agreemenr) under which the City shall make a loan from Its Neighborhood Stabilization Program ("NSP Loan')in the amount of $2,772,253 under the terms and conditions of the NSP Agreement, attached as Exhibit -L to this Agreement Thetotal cost of the Property as approved by Agency. inclining acquisition and renovation, is estimated W be Four Million Seven Hundred Thousand Dollars ($4,700.000). 4. AGENCY PARTICIPATION IN PURCHASE ESCROW. Escrow shall be opened within Me time period specified in the Purchase and Sala Agreement. Agency and Owner shall promptly prepare, execute, and deliver la the Escrow Agent such Paye 12 additional escrow Instructions related to the Loan Guaranty consistent with the terms herein as shall be reasonably necessary. 4.1 Ageni Conditions to Loan QuaranN. Agency's obligation to provide a Loan Guaranty, shall, In addition to any other conditions set forth herein in favor of Agency, be conditional and contingent upon the satisfaction, or waver by Agency, of each and all of Na following conditions (collectively the "Agency's Conditions to Closing'): I. Title shall be conveyed to Owner in a good condition, free and dear of all liens, encumbrances, clouds, conditions, rights of occupancy and possession, except those conditions reoded in the Regulatory Agreement, the Seller's Deed of Trust. the City's Dead of Trust, and to Loan Guaranty. Owner shall hove obtained approval of financing commitments including the Clry NSP Agreement and the Settees Nota for the acquisition and renovation of the Property In accordance with Section 3, and Agency shall have approved such commitments. m. Seller shall have deposited into escrow all the required documents. Owner shall have approved the physical and environmental condition of the Property. Owner shall have deposited into escrow all the required documents. Any waiver of the foregoing conditions must be express and in writing. In the event that Owner fails to satisfy Agency's foregoing conditions or defects In the performance of its obligations hereunder and such failure or default continues beyond the notice and cure period set form in Section 14 of this Agreement, Agency may withhold the Loan Guaranty. The Loan Guaranty shall be In an amount of One Million, Nine Hundred Thirty -Seven Thousand Seven Hundred NlnetySix Dollars ($1,937,798.00), rmrh-recourse, upon me terms contained herein and in the Seller's Note, included in this Agreement as E:e hibit -1' 4.2 Evidence of Financial Caoabll'N. Owner shall submit to Agency's Executive Director for approval evidence that Owner has to financial capacity necessary for the acquisition and renovation of the Property pursuant to this Agreement. Such evidence of financial capability shall include all of the following' Documentation that Owner has secured the Seller's Note. and the City NSP Nate. Page 13 Reliable cost estimates for Owner's total cost of acquiring the Property and developing the Project (including both 'hard' and 'soft' ousts). A financial statement and/or other documentation reasonably satisfactory to the Executive Director sufficient to demgmtrate that Owner has adequate funds available to cover the difference between the total acquisition and renovation costs of the Property and the proceeds of the NSP and Sellers loan commitments. A copy of the proposed contract between Owner and its general contractor for all of the improvements required to be made by Owner hereunder, certified by Owner d be a true and correct copy thereof. The Agency shall also have the right to review and approve any revisions that are made to the proposed centred after its approval by the Executive Director. Owner covenants and agrees to take all action, fumish all information, give all consents and pay all sums maecnably required to keep the construction loan commitment In full force and effect and shall comply with all conditions thereof, and shall promptly execute, acknowledge and deliver all applications, credit applications and data, financial statements, and documents reasonably required In connection therewith. 5. AFFORDABILITY RESTRICTIONS. Upon attaining required firuncing and closing sectors on the Property as described herein, Owner agrees to recent the Regulatory Agreement whereby a total of one hundred seventeen (117) units plus one (1) unrestricted Manager's Unit shall be restricted for fifty-five years (55), with seventy- one (71) units restricted for fennel to households of Very Low Income and forty-six (4B) units restricted for fifty-five years (55) for rental to households of Lower Income, all as described in the Regulatory Agreement Included in this Agreement as Exhibit 'F.' 5,1 Effect of Covenants. Al covenants set forth in the Regulatory Agreement without regard to technical classification or designation shall ba binding for the benefit of 0e Agency, and such covenants shall run in favor of the Agency for the entire pared during which such cants shall be In forte and effect, without regard to whether the Agency is or remains an owner of any land or interest therein to which such covenants relate. The Agency, in the event of any breach of any such covenants, shall have the right to exercise all the rights and remedies and to maintain any actions at law or sults in equity or other proper proceedings to enforce the wring of such breach. 5.2 Covenants Run With the Land The Owner covenants and agrees for Itself. Its successors and assigns, which covenants shall run with the land for the period of the Regulatory Agreement and bind every successor or assign In interest of Owner, Nat during acquisition and novation of the Property pursuant to this Agreement and thereafter, either the Property nor the improvements, nor any portion thereof, shall Prgc 14 be improved, used or occupied in violation of any applicable governmental netrichons or the restrictions of this Agreement. Furthermore, Owner am Its successors and assigns shall not Initiate, maintain, commit, or permit the maintenance or commission on the Property, or in the improvements, or any portion thereof, of any nuisance, public or private, as new or hereafter defned by any salutary or decisional law applicable to the Property or the improvements, or any portion thereof. 5.3 Property Solely Used for 51 ted Purpose. Notwithstanding anything to the contrary or that. appears a be to the contrary in this Agreement, Owner hereby covenants, on behalf of Itself, and Its successors and assig which covenants shall run with the land far the period of Me Regulatory Agreement and bind every successor and assign in interest of Owner, that, Owner and such successors and assigns shall use the property solely for the purpose of renovating, maintaining and attending a residential renal project meeting the requirements and resections of this Agreement and the Regulatory Agreement, including, without limitations, restriction of the rental and occupancy of the Restricted Units only to Eligible Tenants for a rent not in excess of an Affordable Rent for the period specified herein. All Resected Units constructed pursuant to this Agreement shall be occupied at all fines only by the Household of the Eligible Tenant who has rented that Restricted Unit under Me terms contained in the Regulatory Agreement, Exhibit -F.' 5A Labe o of Residences by Owner. a -uo LeasaPeriod. Monthly during the Initial Leese -up Period and annually theafee, Owner shall provide Agency with a report with respecter Restricted Units under lease, leases in default the number and status of Eligible EverIncome Tenants and such other information as Agency may reasonably request h Redriated Resistance . As set forth above, each of the Restricted Units shall be rented to an Ellglble Tenant for a ental rate which all not exceed an Affordable Rent for the applicable Restricted Unit. Annual Tenancy Report. Owner shall provitle Agency forwally, by January 31, with a report on Property occupancy each Resected Unit, Including information concerning the number of months during which each Restricted Unit was ccupled, and the income category of each tenant Household occupying a Restricted Unit, and the number and status of Eligible Over -Income Tenants. The annual report and Owners cols related to each tenancy shall be subject to Inspection and audit upon Agencys written request. Paas 13 6. IMPROVEMENTS ON THE PROPERTY. The Property shall be improved by Owner substantially as provided In the Basic Program of Work, attached hereto as Exhiblt'E', Me Regulatory Agreement, and the plans and permits approved by Agency and City pursuant to Sacton 6 of this Agreement. 6.1 Permits. Owner warrent and represents that the Otys Generel Plan and Zoning Ordinance permits Owners proposed construction, operation, and use of Me Property as provided in this Agreement, including without limtiation Me Basic Program of Work, subject only to approval of Me Property pursuant to Health and Safety Code Sections 33433. Nothing in this Agreement shell be deemed to be a prejudgment or commitment with respect to such items, nor a guarantee that such approvals or permit wall be issued within any particular time or with or without any commits- conddians. 6.2 Timely S b (tial of Applications. Owner shall exercise Its menially, reasonable effort to timely submit all documents and information necessary to obtain all development and building approvals from the City in a timely manner. Not by way of limitation of The foregoing, In developing and constrocMg the Property, Owner shall comply with all applicable development standards in Chys Municipal Code and shall comply with all building code, landscaping, signage, and parking requirements, except as may be permitted through approved variances and modifications. 6.3 A Asestionce In Anpilicaton Process Subject to Owners compliance with (t) the applicable City development standards for the Property, and (ii) all applicable laws and regulations governing such matters as public hearings, site plan review and environmental review. Agency agrees to provide reasonable assistance to Owner, at no coat to Agency, in the expeditious processing of Owners submittals required under this Section in order Met Owner can obtain a final City action on such matters set forth in Me Basic Program of Work. City or Agency's failure to provide necessary approvals or permits within such time pends, after and despite Owners reasonable efforts to submit the documents and information necessary to obtain the some. shall constitute an Enforced Delay. 64 Protect Rea DTC IP bl' Work-Prill wage Requirements. Owner shell be solely responsible for all aspects of Owner's conduct in connection with Me Project, including but not limited W , compliance with all doral, state and federal laws including, without limitation, as to prevailing wage and public bidding requirements, as applicable. This Project is a'public work" project for federal purposes including Davis Bacon and Related Acts wage requirements absent written dtrectionldetermination otherwise by U.S. HUD or a court of competent jurisdiction. Based thereon Owner shall cause the Project work to he performed as a -public work.' The City Council of Me City of Fresno has adopted Resolution No. 82-292 ascertaining the general prevailing rate of per them wages and per diem wages for holidays and overtime in Me Fresno area for each aafd, drunifiwfion, or type of workman respect In Me execution of contracts for the City. A copy of Me resolution is on file at the Office of the Coy Clerk. Actual wage schedules are available upon request at the Cky's Construction Management Office. Without limiting the foregoing, Owner shall ba solely responsible for the quality, and suitability of the work completed, Me supervision of all contrected work, qualifications and financial conditions of and perfomance of all contractors, subcontractors, consultants and suppliers. Any review or Inspection undertaken by Ma City with reference to the Project and/or payroll monitoringrauditing is solely for Me purpose of determining whether Owner is properly discharging Its obligation to Me City, and shall net be relied upon by Owner or by any third parties as a warranty or representation by the City as to governmental compliance andlor Me quality of Me work completed forfbe Project. 65 CEQA. The Project has been environmentally asseseed (Environmental Assessment No. H-2010-10) and was determined M be cate ioncif ly excluded from review under Section 58 35 (a)(3) it and (a)(5) of National Environmental Policy Ad (NEPA) Guidelines. Additionally, Me Project has been assessed under the California Environmental Quality Act (CEQA), resulting in a Categorical Exemption. Based on Me review, City staff determined that the project is consistent with all of the c✓ url specified for an exempdon M CEQA in accordance with Section 15301/Class 1 and 15319(b)(4) of CEQA Guidelines. 6B Financing of Improvements. The cost of constructing all of the improvements required M be constructed for the Project shall be borne by Owner, except for any work expressly set forth in this Agreement or has NSP Agreement b be performed or funded by Me Agency or others. 6.7 Completion of Imoroverranls. Owner shall begin and complete all plans, rsriews, and construction specified in Me Basic Program of Work. Once construction Is commenced, it shall be diligently pursued to completion, and shall not be abandoned for more than thirty (30) consecutive days. Owner shall keep the Agency informed of Me progress of construction and shall submit monthly to the Agency written reports of the progress of the construction In Me form required by Me Agency. 6 Schedule of Performance. Itis understood that the Schedule of Performance contained in the Basic Program of Work is subject to all of Ma terms and conditions set forth In the teat of the Agreement. The time periods set forth In the Schedule of Performance may he altered or mended only by written agreement signed W both Owner and Agency. Afailure by either party to enforce a breach of any particular time proNsion shall not be construed as a waiver of any other time provision. The Exedi Director of Agency shall have the authomy to approve extensions of time without Agency Bosh action not M exceed a cumulative total of tag days. OS Agency Access to Me Property Di Construction. Until Agency Issues the Certificate of Completion. Agency will have access to the Property, after reasonable notice to the Avner (except in emergencies). Page 17 without Marge or fee, during normal cunstrection hours, for purposes of assuring compliance with MIs Agreement Agency representathres will comply with all safety rules whlle on the Protect or the Property, 5.10 Melntenencs of Improvements. Owner fall design and construct the Improvements, and after that, prior to any allowable transfer or sale thereof, Owner all maintain the Property i omrd'mg to all applicable laws Inclutling, without limitation, all applicable state labor standards, Agency zoning and development standards, building, plumbing, mechanical and electrical miles, all provisions of Me Fresno Municipal Code and all applicable access requirements. Agency makes no representation about which, if any, of such laws, ordinances, regulators or standards apply to development of the Foal 9. CERTIFICATE OF COMPLETION. Upon fire substantial completion of all construction required to be completed by Owner on the Property, Agency shall furnish Owner with a Certificate of Completion for the Property in the form aftaMed hereto as Exhibit "O" upon written request therefor by Owner. The Certificate of Completion shall be executed and notarized so as to permit it to be recorded in the Office of Me Recorder N Fresno County. A Ceridlmte of Completion shall be, and shall state that it constitutes, conclusive determination of satisfactory completion of Me construction and development of Me improvements required by this Agreement upon Me Property and of full compliance wtih the terns of this Agreement wIM respect thereto, A partial Certificate of Completion applicable to less than the entire Property shall not be permMetl. After the issuance of a Certificate of Completion, any party then owning or thereafter purchasing, leasing or other Wise acquiring any Interest In the Property shall not (because of such ownership, purchase, leass, or acquisition) incur any obligation or liability under this Agreement with respect to the Property, except Mat such parry shall be bound by the covenants, encumbrances, and easements contained in the Regulatory Agreement attached hereto- After Issuance of a Certificate of Completion, the Agency shall not have any rights or remedies under this Agreement with respect to the Property, except as otherwise sat forth or incorporated in the Regulatory Agreement. Agency shall not unreasonably without a Certificate of Complefion. If Agency refuses or fails to famish a Car ilkets of Completion within thirty (30) days after wmten request from Owner or any entity entitled thereto, Agency shall provide a wriften statement of the reasons Agency refused or failed to tumish a Certificate of Completion. The statement shall also contain Agency's opinion of the action Owner must rake to cousin a Certificate of Completion. If the reason for such refusal Is confined to the Immediate availability of specirc items or materials ler landscaping, or other minor so - Fall punch list" items, Agency will issue its Certificate of Completion upon the pushing of a bond in an amount representing one hundred! My percent (150%) of Me fair value of the work not yet completed or other assurance reasonably satisfactory to Agency. A Certificate of Completion shall not constitute evidence of compliance with or satisfaction of any obligation of Owner to any holder of a mortgage, or any insurer of a mortgage securing money caned to finance the improvements, or any part thereof. Such Cantons Of Completion is not a notice of completion as reformed to in the California Civil Code Section 3093. Nothing herein shall prevent or affect Owner's right to obtain a Certificate of Occupancy from the City before the Certificate of Completion is Issued 8. MAINTENANCE OBLIGATIONS. Owner covenants and agrees for dset, its successors and assigns, and every successor in Interest to the Property or any pad thereof, that, affair Agency's issuance of its Certificate of Completion the Owner shall be responsible for maintenance of all Improvements Met may exist an the Property from time to time, including without limitation buildings, palling lots, Ilghting, signs, and walls. in good condition and repair, and shall keep the Pherson, free from any accumulation of debris or waste materials. The Owner shall also maintain all landscaping required in a healthy condition, including replacement of any dead or diseased plants. The foregoing maintenance obligations shall hen with the land in acooMance wit and for the term of the Regulatory Agreement. Owner's fuller obligations a maintain the Property, and Agency's remedies In the event of Owner's default in performing such obligations, a we form In the Regulatory Agreement. Owner hereby waives any noise, public hearing. and other requirements a the public nuisance laws and ordinances of the City that would otherwise apply, except as specified in said Regulatory Agreement. Upon the sale of any portion of Me Property, Owner (but not Owner's successor) shall be released them thas. requirements imposed by this Section, and the finandal liability therefor, as on the portion of the Property conveyed. 9. INDEMNIFICATION. Owner shall Indemnify. hold harmless and defend Agency and each of its officers, officials, employees, agents and volunteers tram any and all loss, liability, fines, potatoes, fenestrae, castsand damages (whether in contract, tort or strict Iiablllty, Including but not limited to personal injury, death at any time and property damage) incurred by the Owner, Agency or any other person, and from any and all claims, demands and actions In law or equity (including attorneys fees and litigation expenses), arising or alleged a have arisen directly or indirectly from the negligent or Intentional acts or omissions, ar willful misconduct of Owner or any of its officers. officials, employees, agents or volunteers in the performance of this Agreement. Agency shall indemnify, hold harmless and defend Owner 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 Agency, Owner or any other person, all tram any and all claims, demands and actions In law or equity including atomey's fees and litigation expenses), allsing or alleged to have arisen directly or indirectly from the negligent or Intentional acts or omissions, or willful misconduct of Agency or any of its offlcans officials, employees, agents or volunteers in the performance of this Agreement. provided nothing herein shall conattute a waiver by Agency of governmental immunities including Caltoml0 Government Code section 810 at seq. Owner agrees that this Agreement shalt in no way act to abrogate or waive any Immunities available to Agency under the Tort Claims Ad of the Sate of Caltomla. In the event of concurrent negligence on the part or Owner or any of is bfffcars, officials, employees, agents or volunteers, and Agency or any of its officers. officials, employees, agents or volunteers, the liability for any and all soon claims, demands and actions in law or equity for such losses, fines, penalties, tdeil costa acts damages Page 19 shall be apportioned under the Slate of Califomie's theory of comparative negligence as presently established or as may he modAled hereafter. This section shall survive termination or expiration of this Agreement. 10, INSURANCE. Throughout the life of this Agreement, the Owner shall pay for and maintain in full force and effect all policii ies) of insurance required hereunder with an Insurance company either (1) admitted by the Calffonma Insurance Commissioner to do business in the State of Caltfomia and rated! not less than -A-VII' in Best's Insurance Rafng Guide, or (2) authoNzeJ by the Agency's Risk Manager or hisMordesignee. The following polices of Insurance are required. (i) COMMERCIAL PROPERTY Insurance which shall be at least as broad as the most current version of Insurance Service Office (ISO) Commercial Property Form CP 10 W (Cause of Loss —Special Form), with limits of insurance In an amount equal to the full (100%) replacement cast (without deduction for depreciation) of the Improvements with no coinsurance penalty provisions. Such Insumnce shall Include coverage for business income, including 'rental value', In an amount equal to one (1) year of me annual rent generated by are Improvements. Coverage for business income, Including "rental value," shall be at least as broad as the most current version of Insurams Servlet Office (ISO) Commercial Property Form CP 00 30. Owner shall be responsible for payment of any deductibles contained in any insurance policies required hereunder and Owner shall also be responsible for payment of any self Insured retentions. Any deductibles or self-insured retentions must be declared to, and approved by, the Agency's Risk Manager or histherdesgnee The policy of insurance required hereunder shall be endorsed to provide that the coverage shall not be cancelled, non -renewed reduced In coverage or in limits except after 30 calendar day written notice has been given to the Agency. Upon issuance by the insurer broker, or agent of a notice of correlation, non -renewal, or reduction in owatai or in Ilmifs, Owner shall human the Agency with a new certfflcate and applicable endorsements for such policy. In me event the policy is due to expire during this Agreement Owner shall provide a new cartifcate, and applicable endorsements. evidencing renewal of such policy not less than 15 calendar days prior to the aver fon date of the expiring policy. The Property Insurance policy shall name me Agency as a loss payee. The. Insurance required herein shall contain no spacial limitations on the scope of monsoon afforded to the Agency. Owner shell furnish me Agency with all certificate(s) and applicable endorsements affecting coverage required! hereunder. All certlfrcates and applicable endorsements are to be received and approved by the Ageni Risk Manager or h4/har dasignse prior to the Agency's execution of this Agreement. Upon request of the Agency, Owner shall Immediately furnish the Agency wit a complete copy of any insurance policy required under this Agreement, including all endorsements, with said Paye 20 copy Wished! by the underwnter to be a true and correct copy of the original pWicy. This requirement shall survive expiration or tarminatbn of this Agreement Any failure to maintain the required insurance shall be sufficient cause for the Agency to terminate this Agreement. No action taken by the Agency hereunder shall In any way relieve Owner of its responsibilities under phis Agreement. 10.1. Nan-canpetiafon of Policies All policies of insurance required hereunder shall be endorsed to provide that the coverage shall not be cancelled, non-renmvai reduced in coverage or in limits except after 30 calendar day written notice has been given to Agency. Upon issuance by the insurer, broker, or agent of a notice of canrellatlon, non -renewal, or reduction In coverage or in limivs, Owner shall furnish Agency with a row cendicate and applicable endorsements for such policy(ias). In the event any policy is due to expire during the term of this Agreement, Owner shall provide a new canRcate, and applicable endorsements, evidencing renewal of such policy not lass than 15 calendar days prior to the expiration date of the expiring policy. 102 Aaencv is Loss Prose. The Builders Risk (Course of Construction) and Fire and Extended Coverage insurance policies shall be endorsed to name Agency as a lass payee, 10.3 Endorsements. Owner shall furnish Agency with all misiccus(s) and applicable endorsements affecting coverage required! hereunder. All certRcelBs and applicable endorsements are to be received and approved by the Agency's Risk Manager or his/her designee prior to Agencys execution of this Agreement. 10.4 Failure to Maintain Insurance. If at any time Owner falls to maintain the recollect insurance in full force and efleW, Owner shall immediately discontinue all work under this Agreement until Agency receives notice that the required Insurance has bean restored to NII force and effect and that the premiums therefore have been mid far mnotl satisfactory to the Agency. Owner's failure to maintain any required insurance shall be sufficient cause for Agency to terminate this Agreement. 10.5 No Release from li bll'N. The fact that insurance is obtained by Owner shall not be deemed to release or diminish the liability of Owner, intruding. without limitation, liability under the indemnity provisions of this Agreement. The duty to indemnity Agency, City and each of their officials, officers, employees, agents and colonial shall apply to all Balms and liability regardless of whether any insurance policies are applicable, The policy limits do not act as a limitation upon the amount of Indemnification to be provided by Owner, Approval or purchase of any Insurance contracts or policies shall in no way relieve from liability nor limit the liability of Owner. The Owner agrees that the provll of this Section shall not be construed as limiting in any way the extent to which the Owner may be Peyc 21 hold responsible for the payment of damages to any persons or property resulting from the Owners activities or the densities of any person or persons for which the Owner is otherwise responsible. 10.0 Bisquenot for Policies. Upon request of Agency, Owner shall Immediately furnish Agency with a complete copy of any insurance policy, required under this Agreement, including all endorsements, with said copy Palmed by the underwriter to Da a add and correct copy of the original policy. This requirement shall survive expiration or termination of oris Agreement. 11. LIENS AND TAXES. 11.1 Players Liens Until the date Owner is enthled to the issuance by Agency of a Centigrade of Completion, Owner shall not place of allow to be placed thereon any mortgage, trust dead encumbrance or lien (except mechanic's liens prior Is suit to foreclose the same being filed) problbded by this Agreement. Owner shall remove or have removed any levy or attachment made on the Property, or accord me satisfaction thereof, within a reasonable time, but in any event poor to a sale thereunder. Nothing herein contained shall be deemed m prohibit Owner from carousing the validity or amounts of any tax, assessment, encumbrance or lien, nor to limit the remedies available to Owner in respect thereto. Owner will take reasonable efforts to not pean0 any lien or stop notice to be Bled against the Property, Provided Owner may reasonably determine to contest any such lien or step notice. If a claim of lien or stop nonce is occurred against the Property or Improvements, Owner. within 30 days after recordation of a claim of lien or stop notice or within 5 days after Agency's demand, whichever First occurs, will do the fallowing: a. Pay and discharge the same: or b. Effect the release of such lien by recording and delivering to Agency a surety mil in suf dent form and amount (i.e. 150%), or otherwise; or C. Give Agency other assurance which Agency, in Its sole d'rscreoen, deems satisfactory to pmi the Agency from the effect of the lien or Will stop notice 11,2 Properly Taxes. Owner shell pay, when due, all real estate taxes and assessments assessed or levied subsequent to conveyance of title. Nothing in this Agreement shall prevent owner from petitioning the County of Fresno for a welfare. exemption from property taxes basest on the Percentage of affordable units in the Property. 12. MORTGAGE PROTECTIONS. No violation or breach of the covenants, conditions, restrictions, provisions or limitations contained In this Agreement shall defeat or render Invalid or In any way Impair the lien or charge of any mortgage or deed of trust, provided however, that any subsequent owner of the Property shall be bound by such Page 22 remaining covenants, conditions, restrictions, limitations and provisions, whether such owners the was acquired by foreclosure, dead in lieu of foreclosure, bustee's sale or otherwise. 12.1 Permitted Monaa his Notwithstanding the esrctions on transfer in Section 2.2, mortgages required for any reasonable method of financing of the construction of the improvements are permMed before issuance of a Certificate of Completion but only for the purpose of securing loans of funds used or to be used for financing the acquisition of the Property, for the construction of improvements thereon, and for any other it p rrdltures necessary and appropriate to improve the Property under this Agreement, or for restructuring or refinancing any for same, sc long as the refinancing does not exceed the then outstanding balance of the existing financing, including any additional costs for completion of construction, whether direct or indirect, based upon the estimates of architecN and/or contractors. The Owner (or any entity permitted to acquire titre under this Section) shall notlly the Agency In advance of any mortgage, g the Owner or such entity proposes to enter into the same price issuance of the Certificate of Completion. The Owner or such entity shall net enter Into any such conveyance for financing without the pdor written approval of the Agency, which appmval shall not be unreasonably withheld or delayed Any lender approved by the Agency shall not be bound by any amendment, implementation, or modification to this Agreement subsequent to its approval without such lender giving its pnor written consent thereto. In any event, Bre Owner shall promptly notify the Agency of any mortgage, encumbrance, or lien that hes been created or attached thereto prior to issuance of a Certificate of C nnpleti0n, whether by voluntary ad of the Owner or otherwise. After the Issuance of a Cenifcate of Completion, the limitations on encumbrances contained in the Regulatory Agreement shall be in effect 122 Aggi Bilthts upon Failure f Holder to Complete Improvements In any case where one hundred eighty (180) days after default by Owner in completion of improvements under this Agreement, the holder of any mortgage creating a lien or encumbrance upon the Prop" or improvements thereon has not exemsed the option to construct shouted in this Section or if it has examined such option and has not proceeded diligently with concoction, Agency may, after ninety (90) daysnotice to such holder and if such holder has not exercised such option to construct within said ninety (90) day pi purchase the mortgage, upon payment to the holder of an amount equal to the sum of the following: I, The unpaid mortgage debt plus any accrued and unpaid interest (less all appropriate credits, including those resulting from collection and application of rentals and other income received during foreclosure proceed'egs, If any); nL NI expenses incurred by the holder with respect to foreclosure, If any; The net expenses (exclusive of general overhead), incurred by the holder as a direct result of the ownership or management of the property, such as insurance premiums or real estate raves, g any; The costs of any improvements made by such holder, if any; and An amount equivalent to Ne interest that would have accrued on the aggregate of such amounts had all such amounts become part of the mortgage debt and such debt had continued in existence to the date of payment by the Agency. In the event that the holder does not exercise Its option to construct afforded in his Section, and Agency elects not to purchase the mortgage of holder, upon women request by the holder to Agency. Agency agrees to use reasonable efforts to assist the holder selling the holder's interest to a qualified and responsible party or pates (as determined by Agency), who shall assume Ne obligations of making or completing Me improvements required to be constructed by Owner, or such other improvemenk in their stead as shall be sadefraory to Agency. The proceeds of such a sale shall be applied first M the holder of those Items speed in subparagraphs I. through v. hereinahove, and any balance remaining thereafter shall be applied as follows r. post, to reimburse Agency, on I% own behalf and on behalf of the City, for all costs and expenses actually and reasonably incurred by Agency, including but rot limited to payroll expenses, management expenses, legal expanses, and others. u. Second, to mimbume Agency, on its own behalf and on behalf of fire City, for all payments made by Agency to discharge any other encumbrances or liens on the Properly or to discharge or prevent from aftacbing or being made any subsequent encumbrances or liens due to obligations, detainer or sets of Owned, Its successors or transferees. III . Third, to reimbures Agency, on Its own behalf and o behalf of the City, for all wets and expenses actually and reasonably Inwrred by Agency in Increased with its efforts assisting the holder In selling the holders interest In accordance with this Section. IV. Fourth, any balance remaining thereafter shall be paid to Owner. 12.3 Rhalut of Apency to Cum Mortmalgis Dead of Trust or Other Secudty Interest Oefeult In the event of a default or breach by Owner (or Pexc 24 entity permitted to acquire title under His Section), which continues beyond any applicable notice and cure period, of a mortgage prior to the Issuance by Agency of a Certificate of Completion for the Property or portions thereof covered by said mortgage, and the hostler of any such mortgage has not exercised Its option to complete dbe development, Agency may cure such default prior to completion of any foreclosure. In such event, Agency shall he entitled to nambureement from Owner or other entity of all costs and expenses incurred by Agency in curing the default, to the extent penmtted by law, as If such holder initiated such claim for reimbursement, including legal costs and atiomi fees, which right of reimbursement shall be secured by a lion upon the Property ro the. extent of such costs and disbursements. Any such lien shall be subject to I . My mortgage for financing parst by Mis Agreement; and n. My rights or interests provided in this Agreement for the protection of the holders of such mortgages for financing; provided that nothing herein shall be deemed to Impose upon Agency any aRnnative obligations (by the payment of money, construction or otherwise) with respect to the Property in are event of its enforcement of its lien. After the conveyance of title antl prior to the recordation of a Certificate of Completion for construction and development. and after the Owner has had a reasonable time to challenge, cure, or satisfy any liens o encumbrances on the Property or any portion (hereof, the Agency shall have the right to satisfy any such liens or encumbrances; provided, however, that nothing In this Agreement shall regulre the Owner to pay or make provision for the payment of any tax, assessment, lien or charge co long as the Owner in good faith shall comest the validity or amount thereof, and so long as such delay in payment shall not subject the Property or any portion thereof m forfeiture or sale. Notwithstanding anything to the contrery, contained herein, the terms and conditions contained in this Agreement and the Regulatory Agreement will be subordinated to the liens securing any financing permitted under this Agreement. 13. NON-DISCRIMINATION PROVISIONS 13.1 Obligation to Retrain from Dhcrlmnan b There shall be n discrimination against, or segregation of, anypersons, or group of parsons, on account of rare, color, creed religion, sex, marital status, national origin o ancestry in the rental, sale, lease, sublease, transfer, use, occupancy, or enjoyment of the Proi or any portion thereof, no shall Owner, or any person claiming under or fl nough Owner, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, "1 25 lessees, subtenants. sublessees or vendaes of pre Property or any portion thereof (except as permitted by this Agreement). The nondiscrimination and nonsegragatlon covenants contained harem shalt remain in effect in perpetuity. 13.2 Eortn of alondiscaningination and Nonsidareapaten Clauses. Subject to the tenancyloccupancy, restrictions on the Restncted Units not prohloted by federal law as committed In this Agreement, which may modify the following nondiscrimination clauses, express previsions shall be included In all deeds, leases, and centrads with respect to the sale, lease, sublease, transfer, use, occupancy, agrees, or enjoyment W bre Project in substantially the following farm: (a) (1) In deeds the following language shall appear—"Tho grantee herein covenants by and for himself or herself, his or her hairs, executors, administrators, and assigns, and all persons claiming under or through them, that there shall me no discrimination against or segregation of, any person or group of persons on account of any basis listed in subdivision (a) or (d) of Section 12g55 of the Government Code, as those bases are defined in Sections 12925, 12926.1, subdivision (m) end paragraph (1) of subdMsion (p) of Secbon 12955, and Section 12955.2 of the Government Code, in me sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the promises herein conveyed, nor shalt the grantee or any person claiming under or through him or her, establish or permit any practice or practices of discrimination or segregation with reference b the selection, location, number, use or occupancy of tenants, lessee, subtenants, sublessees, or vendees in the premises herein conveyed. The foregoing covenants shall run with the land" (2) Nalwlthstanding paragraph (1), with respect to familial status, paragraph (1) shall not ba construed to apply to housing for older parsons, as defined in Section 12955.9 of cre Gov smment Code. With respect to familial status, nothing in paragraph (1) shall be construed to affect Scott 51.2, 51.3, 51 4, 51 10. 51.11, and 7995 of the Civil Code, retailing to housing for senior citizens. Subdivision (d) of Section 51 and Section 1350 of the CINI Code and subdivisions (n), (o), and (p) of Section 12955 of the Government Coda shall apply to paragraph (1). (b) (1) to leases the following language shall appear—The lessee herein covenants by and for himself or herself, his or her heirs, executors, administration; , and assigns, and all parsons claiming under or through him or her, and this lease is made and accepted upon and subject b the following conditions: That there shall be no decdminatlon against or segregagon of any person or group of persons an account of any basis listed In subdlvleon (a) or (d) of Section 12955 of the Government Code. as Page 26 those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the leasing, subleasing,transferdng, use, occupancy, tenure, or enjoyment of the premises herein Issued nor Shall the lessee himself or herself, or any person claiming under or through him or her, establish or Permit any such practice or proceeds of discrimination or segregation with reference to the selection, tocation, number, use, or occupancy, of tenants, lessees, sublessees, sudenants, or vendees in the premises herein leased' (2) Notwithstanding paragraph (1), with respect to familial status, paragraph (1) shall not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Core. With respect to familial status, nothing In paragraph (1) shall be construed to affect Sectors 51 2, 51.3, 51.4, 51.10. 51.11, and 799.5 of the Civil Code, relating to housing for senior citizens. Subdivision (d) of Section 51 and Section 1369 of the Civil Code end subdivisions (n), (o), and (p) of Section 12955 of the Government Cade shall apply to paragraph (1). (c) In contracts entered into by the Agency relating to the sale, transfer, or leasing of land or any interest therein secured by the Agency within any survey area or redevelopment pmject the foregoing previsions in substantially the forms set forth shall be included and the contracts shall further provide that the foregoing provisions shall be binding upon and shall obligate me contracting parry or parties and any subcontracting party or pates, or other transferees under tee instrument. 14. DEFAULTS, REMEDIES, AND TERMINATION. Subject to any Enforced Delay, failure or delay by either party to timely perform any covenant of this Agreement condition; a default under this Agreement, but only 0 the party who so fans or delays does not commence to cure, carted or remedy such failure or delay within thirty (30) days after mentor of a wreten notice specifying such failure or delay, and does net thereafter prosecute such cure, connection or remedy with diligence to completion. The injured path shall give written notice of default to the path in default. specifying the default complained of by the Injured party. Except as required to protect against further damages, the injured party may not Institute proceedings against the party in default until thirty (30) days after giving such notice. Failure or delay in giving such notice shall not constiNtea waiver of any default, nor shall it change the time of default. Except as othenvlse provided in this Agreement, waiver by either party of the performance of any covenant, condition, or primhe, shall rot Invalidate this Agreement. nor shall it be considered a waiver of any other covenant, condeon, or promise. Waiver by either path of the time for performing any ad shall not constitute a waiver of time for Pae, 27 performing any other act or an identical act required to be performed at a later find. The delay or forbearance by either party in exercising any remedy or right as to any default shall not operate as a waiver of any default or of any rights or remedies or to captive such party of its right to institute and maintain any actions or proceedings which it may deem necessary to protect, assert, or enforce any such rights or remedies. 14.1 Least Actions. In addition b any other rights or remedies, either Party may institute legal action to cure, conal or remedy any default to cover damages for any default, or to obtain any other remedy consistent with me purpose of this Agreement Legal actions must be instituted and maintained In the Superior Court of the County of Fresno.. State of California, in any other appropriate court In that county, or in me Federal District Court in the Eastern Division of the Cenral Chat d California. a. The laws of that State of California shall govern the interpretation and enforcement of this Agreement. b. In the event that any legal action Is commenced by Owner against Agency, service of process on Agency shall be made by personal service upon the Executive Dressier or Secretary of Agency, or in such other manner as may be provided by law. c. In the event that any legal action is commenced by Agency against Owner, service of process on Owner shall be made in such manner as may be provided by law and shall be valid whether made within or without the State of California. 14.2 Rights and Remedies are Cumulative. Except as otherwise expressly stated In this Agreement, the rights and remedles of the parties are cumulative, and the exercise by either party of one or more of its rights or rearranges shall not preclude the exercise by It, at the same or different times, of any other rights or remedies for the same default or any other default by the other party. 14.3 Specific Penomlance. In sadden to any other remedies pennided by this Agreement, d either party defaults hereunder by failing to perform any of its obligations herein, each party agrees that the other shall be ended to the judicial remedy of specific performance, and each party agrees (subject to its reserved right to carni whether In fad a default does exist) not to challenge or contest the appropriateness of such remedy. In this regard, Owner spa ificalty acknowledges that Agency Is entering into this Agreement for the purpose of assisting in the redevelopment of the Property and not for the purpose of enabling Owner W speculate with land. 15. GENERAL PROVISIONS 15.1 Nobces Demands d Communications BegArgen the Parties. Except as expressly provided b five contrary herein, any notice, consent, Page 28 rei demand, document or other such item to be given, delivered, ormahed or received hereunder shall be deemed given, delivered, honored, and received when given in writing and personally delivered to an authorized agent of the applicable party, or upon delivery by the United States Postal Service, first-class registered or curdled mall, postage preload, return receipt requested, or by a national 'overnight courner' such as Federal Express, at the fime of delivery shown upon such receipt: or by facsimile, If such facsimile is followed by a notice sent out the same day by mail; in any case, delivered to the address, addresses and persons as each party may from time to time by written notice designate to the other and who Initially are: Agency: Redevelopment Agency of the City of Fresno 2344 Tulare Streel, Suite 200 Fresno, CA 93921 Ado Executive Director Owner: Fresno Revitali tion Corporation clo Redevelopment Agency of the City of Fresno 2344 Tulare Street, Suite 209 Fresno, CA 93721 15.2 Nankabili of City and Agency Cifficull§ and Employees Conflict of InterestCommission a. Personal LOW . No member, cfficlal, employee, agent or contractor of City or Agency shall be personally liable to Owner in the avant of any default or breach by Agency or for any amount which may become due to Owner or an any obligations under the terms of the Agreement provided, it is understood that nothing in this Section 15 2 is intended to limit Agency's liability. b. Financial Interest No member. official, employee or agent of Clry or Agency shall have any financial Interest, direct or indirect, in this Agreement nor participate in any derision relating to this Agreement which is prohibited by law. c Commissions Neither the Agency nor the Owner has retained any broker or finder or has paid or given, and will not pay or give, any third person any money or other consideration for obtaining this Agreement. Neither parry shall be liable for any real estate commissions, brokerage fees or firulers' fees which may arise from this Agreement, and each pant agrees to hold the other harmless hum any claim by any broker, agent, or finder retained by such party. No, 29 a. Owner shall prepare and maintain all books, records and reports necessary to substantiate ownefs compliance with the terms of this Agreement or reasonably required by the Agency b. Either parry shall have the night, upon not less than seventy-two (12) hours notice, at all reasonable times, to Inspect the books and records of the other parry containing to the Property as pertinent to the purposes of this Agreement. 15.4 Assurances to Act in Good Fail Agency and Owner agree to execute all documents and instruments and he take all action, including deposit of funds in addition to such funds as may be specifically provided for herein, and as may be required In order to consummate conveyance and development of the Property as herein contemplated, and shall use their best efforts, to accomplish the closing and subsequent development of the Property in accordance with the provisions hereof Agency and Owner shall each diligently and In good faith pursue the satisfaction of any conditions or contingencies subject to their approval. 15.5 Inamriabi . The temrs of this Agreement shall be construed In accordance with the meaning of the language used and shall not be cogstroed for or against either party by reason of the authorship of this Agreement or any other rule of construction which might otherwise apply. The Simmer headings are for purposes of convenience only, and shall not be construed to limit or extend the meaning of this Agreement This Agreement includes all atfechmenis attached hereto, which are by this reference Incorporated in this Agreement in their emlrery. This Agreement also includes any other documents incorporated herein by reference, as though fully set forth herein 15.6 Entire Agreement Wavers and AmendmenR. This Agreement Integrates all of the terms and conditions mentioned herein, or incidental hereto, and this Agreement supersedes all negotiations and previous agreements between the partes arm respect to all or any part at the subject matter hereof. All waivers of the provisions of this Agreement, unless specified otherwise herein, must be in writing and signed by the appropriate authorities of Agency or Owner, as applicable, and all amendments hereto must be in will and signed by the appropriate authorities of Agency and Owner. 15.7 Spire lith. In the event any term, covenant, condition, provision r agreement contained herein is held to be invalid, void or otherwlse unenforceable, by any court of competent jurisdiction, such holding shall in no way affect the validity or snfomaabillty of any term, covenant, condition, provision or agreement combined herein. 158 Eirearbution. Page 30 1. This Agreement may be executed in counterparts, each of which shall be deemed to be an original, and such counterparts shall constitute one and the same instrument. 2. Agency represents and warrants that (i) It is a Redevelopment Agency duly organized and existing under the laws of the State of CalHomie; (it) by proper action of Agency, Agency has been duly authorizetl to execute and deliver this Agreement, acting by and through its duly authorized oRrcers; and (iii) the entering into this Agreement by Agency does not violate any provision of any other agreement to which Agency is a party. 3. Owner represents and warrants that (I) it is duly organized and existing under the laws of the State or Caliromia; (li) by proper action of Owner, Owner has been duly authorized to execute and deliver this Agreement, acting by and through Its duly authorized oficers: and (iii) the entering Into The Agreement by Owner does not violate any provision plan other agreement to which Owner is a parry. 15.9 Sill of Approval. My conseme or approvals required or permitted under this Agreement shall not be unreasonably wfthheld or made, except where it is specifically provided that a sole discretion standard applies. SENO —SIGNATURES ON NEXT PAGE) rain IN WITNESS WHEREOF, the Agency and O ner have executed this Operating Agreement by duly authorized representatives on the date first vantten hereinabove. Date: Data: -OWNER" FRESNO REVITALIZATION CORPORATION, e California non-profit public benefit corporation BY Its. Fresno Revitalization Corporatigl/ do Redevebpment Agency of ddat44 City of Fresno 2344Tulare Street, Suge 200 Fresno, CA 93721 Dale: s�z,11D "AGENCY' THE REDEVELOPMENT AGENCY OF THE CITY OF FRESNO, a public body, corporate and politic Marlene Murphey, Exedhir D' ctor Redevelopment Agency of the City of Fresno 2344 Tulare Street, Suite 200 Fresno, CA 93721 ATTEST'. APPROVED AS TO FORM REBECCA KLISCH JAMES C. SANCHEZ Ex -Officio Clerk Ex-OFclo Aftamey 5/20/roJy{Q-�/u Deputy 9 Deputy Page 32 [END OF SIGNATURES] Pagc 33 STATE OF CALIFORNIA ) )ss. COUNTY OF On before me. personally appeared personally known to me (or proved to me on the basis of satisfactory evidence) to be me parsons) whose names) Islam subscribed to the wdPon instrument and acknowledged to me that helshetlhey executed the same In hismarMeir authorized capacity(ies), and that by hislher/their signaturi an the Instrument the Persons) or the amity upon behalf of which the pensai acted, executed the Instrument Witness my hand and official seal. Notary Public [SEAL[ STATE OF CALIFORNIA ) )ss. COUNTY OF On before me, . Persanally appeared personalty known to me (or proved to me on the basis of satisfactory evidence) to las the persons) whose names) islare subscribed to the within instrument and acknovdedged to me that helshetlh hl executed the same In hismerlthame aumodxed capmandies), and that by hislher/their signaturea(s( on the instrument me persons) or the entity upon behalf of which the persons) acted, executed the inebument. [SEAL] Moves my hand and official seal. Page 34 Notary Public STATE OF CALIFORNIA [ COUNTY OF On before me, , personally appeared personally known to me (or proved to me on the basis of satisfactory evidence) to bs The bombards) whose names) 'Ware subscribed to the within Instrument and acknowledged to me that helshelthey executed Na same in hWherttheir authodzed capaciMies), and that by hilt herlthese signatures(s) on the Instrument the pemon(s) or the entity upgn behalf of which the parochial acted, executed Rte instrument. Wanness my hand and official seal. Notary Public [SF1d 1 STATE OF CALIFORNIA ) ) ss. COUNTY OF On before me; personally appeared personally known to me (or proved to me on the basis of satlsfaclory evidence) to be the persen(s) whose names) islare subscribed to dre within instrument and acknowledgetl to me that leWshanhey, executed the same in hkvlberftheir authorized capacity(ies), and that by h'affil air mgnatures(s) on the Insbomant the persanls) or the entity upon behalf of which the persons) acted, executed the instrument. [SEAL[ Witness my hand and official seal. Paye ]$ ��:IJI�IYIP� LEGAL DESCRIPTION OF PROPERTY THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF FRESNO, COUNTY OF FRESNO, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS: Lots 1. 2, 3, 4 and 5 of Tract No 1938, Huntington Holmes Park, In the City of Fresno, County of Fresno, Slate of California, acdon ing to the map thereof remMed Apol 26, 1963 in Volume 21 Pages 66, 67 and 88 N Plats, Fresno County Famous. Excepting therefrom all all, gas, other hydreearhen substances and minerals of any kind or chaoi In, on, or thereunder, as reserved in coeds of record. IilL`IC!3�'lrT•ULGfi EXHIBIT "B" PLAT MM OF THE PROPERTY + 9 i g� I FA% FF S ry Fs � a � a- }iF�T � 3 Fg I� 55 e a I' S ry � a- }iF�T � EXHIBIT "C" BUDGET/FINANCIAL PLAN Proposed Initial Renovation Costs Proposed Saunas and Uses BE Funds Acquisition and Rehab Project ScAlf Slvf ACQUISITION V7. IMPROVEMENTS 85W 95M WNCRETE LOAN FROM INLAND MORTGAGE CAPRAL 24286 242M ESTIMATEDCLOSINGCOSTS $15,000 TOTAL PURCHASE PRICE $4,419,DCO REHAB WINDOWS mw a mm REHAB OF SIX UNITS $1171040 EMRIOR DEFERRED MAINTENANCE $103,ON PESTCOWROL WORK BUIWING woo 124M IM70 L"EMOR no 76380 27190 INTERIOR 56796 a 56796 Proposed Saunas and Uses BE Funds Acquisition and Rehab Project ScAlf Slvf ACQUISITION CM MR LOAN (ACQUISRION PORTION) 52,480,204 LOAN FROM INLAND MORTGAGE CAPRAL $1,932,29$ ESTIMATEDCLOSINGCOSTS $15,000 TOTAL PURCHASE PRICE $4,419,DCO REHAB CRY NSP WAN (REHAB PORTION) $292,049 REHAB OF SIX UNITS $1171040 EMRIOR DEFERRED MAINTENANCE $103,ON PESTCOWROL WORK $12,000 POOLKEPAIRS $2Q000 CONTINGENCY $]0,003 Proposed Operating Pro Fomes Pro Famu MontM1N pro Farma Annuall RENTAL INCOME GROSS RESIDENTIAL RENT 65.95000 79160000 IESSVACANCYAWUSTMENTS 18596601 LEVI EFFECTIVE GROSS INCOME(EGN 59.35500 )12,260.00 OPERATING EXPENSES PAYROLL EXPENSES ONSEE MANAGER (41Ce.6T) (60= GET PAYROLL EXPENSES ON SITE MAINTENANCE (2,71667) (32,600.09) ADMIN EXPENSES III MGMTF6E) (1,229.1'n (14,760,00) MANAGEMENT FEES (4%o1 EGN (2,374.20) (28,49).40) MARKETING/REIENFX)N (1,16000) (14,1EXTEE) MAINTENANCE B REPAIR (2,950 W) (35,400.00) TURNOVER EXPENSES (1,966.87) (23,0,60;60) UTILITIES (6.43258) (77.191.00) RESERVES FOR REPLACEMENT (1,06867) (23,8W.W) INSURANCE (250.00) (30.00000) PROPERTY TAXES (4174601 051 W) TOTAL OPERATING EXPENSES 3165712 1379885401 NET OPERATING INCOME 2789708 332,3740 INTEREST EXPENSE 1102541)1 023.0M,W) NET INCOME/CASN FLOW $ 17 "3 71 $209,324.55 EXHIBIT "D' CERTIFICATE OF COMPLETION CERTIFICATE OF COMPLETION RECORDED AT THE REQUEST OF AND WHEN RECORDED RETURN TO: Redevelopment Agency of Clty of Fresno 2344 Tulare St., Suite 21X1 Fresno, Ca. 93721 Attention: Executive Director (&`M AEM(ETIS LINE This Canniest of Completion is recorded at the request and for the benefit of the Redevelopment Agency of the City of Fresno and is exempt from the payment of a recording fee pursuant to Government Cade Section 6103. Redevelopment Agency of the City of Fresno By: Marlene Murphey Its: Executive Director Certificate of Completion Canyon Crest Condominiums Recitals. A. By an Oparedng Agreement (the "Agreement") caped I 1, 2010 between the Fresno Revirdiratian Corporation, a Call nonpmfd public banefrt corporator ("Ownef) and the Redevelopment Agency of the City of Fresno, a public hotly corporate and politic ('Agency"), Owner agreed to acquire renovate and maintain certain residential units on the premises legally described in Attachment "A" hereto (the "Property") and preserve the Affordable Units, as defined in the Agreement as rental housing for Low and Very Low -Income Families with to assistance IN an Agency loan guaranty while meeting Ne Affordable Housing. Income targeting and other requirements of the Community Redevelopment law set forth at California Health and Safety Cade Sections 33000 at seq. for a fifty-five (55) year Affordability Period according to the terms and conditions of the Agreement. B. The Agreement was recorded on t 1 , 2010 In the Official Records of Fresno County, California as Instrument No. C. Under me terns of the Agreement, after Owner completes the renovation work on are Property. Owner may ask Agency to record a Cenficate of Completion. U. Owner has asked Agency to furnish Owner with a recordable Certlficots of Completion. E. Agency's Issuance of this Certificate of Completion Is conclusive evidence that Owner has completed the renovation work on the Property as set to& in me Agreement. NOW THEREFORE I . Agency cartAies that Owner commenced the renovation construction work on the Pmjecl on I J. 2010, and completed the construction work on the Fail 2010, and has done so in full compliance with the Agreement. 2. This Certificate of Completion is not evidence of Owners compliance with, or satisfaction of, any obligation to any mortgage or sa iN interest holder, or any mortgage or security Interest insurer, securing money lent to finance work on the Property or Project, or any part of the Property or Project. 3. This Certificffie of Completion is not a notice of compkd1 n as referred to In Callfomia CIO Code section 3093. 4. Nothing contained herein modifies any prevision of the Agreement IN WITNESS WHEREOF. the Agency has executed this Certificate of Completlon as of this _ day of , R010. Redevelopment Agency of the City of Fresno Maden Mumhey 6 eeut'rve Directar Owner hereby consents to recording tNs Certificate of Completion against the Property desonbed herein. Dated .2010 Fresno Revitalization Corporation Its: THE ABOVE PARTIES ARE TO SIGN THIS INSTRUMENT BEFORE A NOTARY PUBLIC, ATTEST: APPROVED AS TO FORM: Ex -Officio Clank. Redevelopment Agency Ex -Officio Attomay, Redevelopment Agency Deputy Deputy Dated Dated: CONTRACTUAL SERVICES AGREEMENT BY AND BETWEEN THE FRESNO REVITALIZATION CORPORATION, INC. AND THE REDEVELOPMENT AGENCY OF THE CITY OF FRESNO THIS AGREEMENT is made and entered into the cg0I day of May, 2010 ("Effective Date"), by and between the FRESNO REVITALIZATION CORPORATION, a California Non - Profit Public Benefit Corporation (hereinafter referred to as'FRC" ), and the REDEVELOPMENT AGENCY OF THE CITY OF FRESNO, a public body corporate and politic (hereinafter refened to as'AGENCY'). RECITALS The series enter this Agreement based on the following facts, understandings, and intentions WHEREAS, by authority granted under California Health and Safety Code (Cal. HSS C.) Section 33000 at sec. (the 'Lai the Agency has prepared and Is responsible for call out the redevelopment plan for certain Redevelopment Project Areas (the 'Planl including as to certain priority of use of Tax Increment anmor Housing Sat Aside Funds (collectively'Tax Increment'); and WHEREAS, to the extent provided in or allowed by Cal. H&S.C. Sections 33334.2 and 33449, as provided by pint resolutions of the Fresno City Council and the Agency, findings and determinations pursuant to Health and Safety Code Section 33334.2(g), the Man and limited to the terms and conditions therein, the Agency may make improvements upon and/or construct and improve structures in order to provide housing for Persons and families of low or moderate income, including related on-site and off -sire improvements, by variously (1) allowing the use of Housing Set Aside Funds outside the Airport Area Revitalization, Central Business District. Central City Commercial Revitalization, Chinatown Expanded, Convention Canter, Freeway gg- Golden State SouleveN Condor, FruiVChuron, Mariposa, Reeding Business Park, South Fresno Industrial Revitalization. South Van Ness Industrial, Southeast Fresno Revitalization, Wast Fresno I and West Fresrw II redevelopment plans; (2) restricting fire use of the Housing Sat Aside Funds to certain of the Community Development Black Grant eligible areas of the City: and, (3) placing a ponty on the use of the Housing Set Aside Funds from certain Project Areas to be used either within or adjacent to the Central Plea or adjacent to certain Project Areas: and WHEREAS, the Fresno Revitilitation Contraction, is a California Public Beni Corpomfioq Is exempt from federal and state income tax under Section 501 c(3) of the Internal Revenue Code and Section 23701(d) of the California Revenue S Taxation Code for the purpose of resisting the Agency with revitalization of the downtown area of Fresno, California: and WHEREAS. FRC proposes to aWuire all rights, 11" and Interest in fee to the Canyon Crest Condominium project, that certain real property further described in Exhibit 'A' attached hereto and incorporated herein (the "Property") pursuant to an Agreement for Purchase and Sale of Real Property between the FRC and IMCC Canyon Crest, LLC, a Delaware Unrited Llability Company ('Sager'), as described In Exhibit 'F' of this Agreement. The Property Is located within the territorial jurisdiction of the Agency for the use of Low- and Moderate -Income Housing Funds; and Page 1 WHEREAS, the Property is a multi -family residential project consisting of one hundred eighteen It 18) maxierhal unit. All of the units except for one Ouallfled Manager's Unit, which will not Im income-restrictnd, are to ba considered 'Affordable Units.' Stay percent, or savary one (71), of the Affordable Units are to be rented and preserved as Affordable Rental Housing for households at 80% of Area Median Income or below and forty-six (48) of the Affordable Units are t be minuet and preserved as Affordable Rental Housing for households at 80% of Area Median Income or below; and WHEREAS, pursuant to a Neighborhood Stabilization Program Agreement ("NSP' and "NSP Agreement') between FRC and the City of Fresno, antretl pursuant to Ste Congressanal adoption of This III of the Housing and Economic Recovery Act (HERA) of 2008, FRC shall receive a WWI of $2,]]2,283 In NSP multi -family funds, SIM $2,491 set aside for the acquisition of the Property, with the balance of $292,049 drawn down for rehabilitation and closing costs- FRC agrees to undertake acqulsitIon and improvement in accordance with Bre schedule of performance contained within said NSP Agreement attached and incorporated herein as Exhiblt'B'; and WHEREAS, pursuant to an Operating Agreement between FRC (as "FRC') and Agency (the 'Operating Agreemem'), dated and attached and incorporated herein as Exhibit 'C", FRC agrees to undertake improvement in accordance with Ma schedule of performance contained wilhin sale Operating Agreement; and WHEREAS, pursuant to One Operating Agreement. Agency has agreed to assist FRC's acquisition of the of the Property by providing a Loan Guaranty in FRC through the use of certain Housing Set Aside Funds In to amount of Ona Million, Nine Hundred Thirty Seven Thousand, Seven Hundred Ninety -Six Dollars ($1,937,998.00) (the 'Wan Guamnw) upon the terms and conditions sped8ed in to Operating Agreement and the Loan Guaranty AgreamenC and WHEREAS, the Agency agrees t provide administrative, financial and technical support to the FRC in acquiring and operating the Propend; and WHEREAS, the performance of the affordability and other covenants and restrictions set forth in the Operating Agreement shall be evidenced by a Regulatory Agreement which shall be recorded against and run with the Property, attached and Incorporated herein as Exhibit `D'; and WHEREAS, FRC desires to obtain professional services to assist with to acquisition, operation, management, renovation and re-marwitirg of the Property, and desires the Agency to provide the services described herein; and WHEREAS, Agency Is engaged In the business of obtaining technical and expert services and hereby represents that It Is professionally capable of performing the saMms called far by this Agreement. Page 2 AGREEMENT NOW. THEREFORE, in consideration of the foregoing and of the covenants, conditions, and premises hereinafter contained, to be kept and performed by the respective parties, It is mutually agreed as follows: 1. Scone of Work. Agency shall pedopn to the satisfaction of FRC, Ne services described in Exhibit "P, attached hello and incorporated herein by reference. �a'S —1 fffids7 a. Agency's sole compensation for satisfactory performance of all services required pursuant to this agreement, including the Loan Guaranty, shall be ten percent (10%) of the net operating income of the Property, defrost as Ma adjusted gross Income less the normal and customary operating expenses incurred at the Property, before dell service; and expenses consisting solely of Property -related expenses with acceptable supporting documentation. b. Statements may be rendered monthly and shall be payable In the normal course of Agency business. C, The parties may modify this Agreement to Increase the scope of work or provide for the rendition of services not required by this Agreement, which modification may include an agreed-upon increase in Agency's compensation. Any increase or change In the scope of work must bet made by written amendment to Me Agreement signed by an authorized representative for each party. Agency shall not be entitled to any additional compensation If work Is perform f prior to a signed written amendment. 3. Tenninationof Acreement. This Agreement may he terminated by either party upon 30 calendar days prior written nrfice should the other party fail substantially to observe, fulfill or perform any obligation, covenant, term or condition In accordance with this Agreement. A party wilt have failed substantially to obsenx, fulfill or perform any obligation, covenant, term or condition of this Agreement. If such failure is not cared within such W calendar days prior written nonce and this shall constitute a material default and breach of this Agreement. b. In the event of termination pursuant b Section 3a or not due to the material default of Agency, Agency shall be paid compensaton for services satisfactorily padonned prior to the effective date of the notice of termination. In Me event of termination due W the material default of Agency, FRC may withhold an amount that would otherwise be Payable as an offset to, but not in excess of, FRC'S damages caused by such failure. No remedy or election hereunder shall be deemed exclusive but shall, wherever possible, be cumulative with all other remedies at law or in equity. 4. Time of Performance. The services of Agency as described in this Agreement re to commence upon issuance of a "Notice to Proceed.- Work shall be undertaken and completed in a sequence assuring expeditious completion, but In any event, all thea races required by ins& Agreement shall be completed par time frame Indicated on the Scope of Work. Page 3 5. Ownership of Documents, Any and all writings and documents prepared or provided by FRC pumuant m this Agreement are the property of FRC and shell be turned over to FRC upon expiration orimmination of the Agreement. 6. Emleassional Skill. It is further mutually understood and agreed by and between the parties hereto that Agency shall perform the work agreed to be done by It under this Agreement, and that FRC reties upon the skill of Agency to do and perform its work in a skillful manner. 7. Indemnification. FRC shall Indemnify, hold harmless and defend Agency and each of its officers , officials , employees, agents and volunteers from any and all loss, liability, fines, penalties, mrfedures, costs and damages (whether in contact, tart or stflp liability, including but not limited to personal Injury, death at any time and property damage) incurred by the FRC. Agency or any other person, and from any and all claims, demands and actions in law or equity (Including attorney's fees and litgatiion expenses), ani or alleged to have arisen directly or indlrealy from the negligent or intentional acts or omissions, or willful misconduct of FRC or any of Its officers, officials, employees, agents or volunteers in the performance of this Agreement. Agency shall Indemnify, hold harmless and defend FRC and each of its officers, officials employees, agents and volunteers from any and all mss, liability. fines, penaltles, forfeitures. costs and damages (whether in contract, tort or stem liability, including but not limited to personal injury, death at any time and property damage) incurred by Agency, FRC or any other person, and tram any and all claims, demands and actions in law or equity (including attorney's fees and litigation expenses), arising or alleged m have arisen directly or indirectly from the negligent or intentional acts or omissions, or willful misconduct of Agency or any of its officers, officials, employees, agents or volunteers in the performance of this Agreement; provided nothing herein shall constitute a waiver by Agency of governmental immunities including Cslifomia Government Code section 810 at sap. FRC agrees that mis Agreement shall In no way act to abrogate or waive any immunities available to Agency under the Tort Claims Act of ft State of California. In the event of concurrent negligence on the part of FRC or any of its officers, officials, employees, agents or volunteers, and Agency or any of Its offcecers, officials, employees, agents r volunteers, the liability for any and all such claims, demands and actions In law or equity for such losses, fines, penalties, forfeitures, costs and damages shall he apportioned untler me State of Celgomia's theory of comparative negligence as presently established or as may be modified hereafter. This section shall survivor termination or expiration of this Agreement. a. Imo@ It is understood and agreed that FRC and Agency maintain insurance policies or self Insurance programs to fund their respective liabilities. Evidence of Insurance, e.g., Certificates of Insurance or other similar documentation, shall not be required of eimer parry under this Agreement. pegs 4 I General Terms. a. Except as otherwise provided by low, all notices expressly required of FRC within the hotly of this Agreement, and not otherwise spedbrally provided for, shall be effective only t signed by FRCS Acting Chairman b. In performing the work or services to be provided hereunder, Agency shall not employ or retain the services of any person while such person either is employed by FRC, or is a member of to FRC board or committee. This requirement may be waived in ening by the respective Agency Executive Director for the Agency and Acting Chairman for me FRC if no actual or potential conflict is Involved. C. Records of Agency's expenses straining to the Pmjed shall be kept on a generally recognized accounting basis and shall be available M FRC or its authorrzad representatives upon request during regular business hours throughout the life of this Agreement and for a period or three years after final payment. In addition, all books, documents, papers, and records of Agency pertaining to the Project shall b i available for the purpose of making audits, examinations, exceryts, and transcriptions for the came period of time. This Section 9c shall survive expiration or termination of this Agreement. J. Prior to execution of this Agreement by FRC. Agency shall have provided evidence to FRC that Agency or Agency's agents are qualied to perform the services called for by this Agreement If Agency should subcontract all or any portion of the work to ha performed under this Agreement, Agency shall require each subcontractor to provide evlEence m FRC that subcontractor is licensed to perform the services called for by this Agreement (or that rid license Is required) before beginning work. 10. Qonfid of Interest and Non -Solicitation. a. Agency shall comply, and require any of Its subcontractors to comply, wdh all laws and regulations including, without limitation, conflict of Interest laws, such as Government Cade 1090 at seq., the Celtamia Political Reform Act (Government Coda Section 97100 at seq.) and tM regulations of the Fair Political Practices Commission concerning disclosure and disqualification (2 CelBomia Code of Regulations Section 18700 at serl At any time, upon written request of FRC. Agency shall provide a ended opinion of Its legal counsel and that of any subcontreccur that, after a due diligent Inquiry. Agency and the respective subcontractors) are In full compliance with all laws and regulations. Agency shall take, and require any subcontractors to take, reasonable steps to avoid any appearance of a conflict of Interest, Upon discovery of any facts giving nse fo the appearance of a convict of interest, Agency shall immediately notify FRC of Mese facts in writing. b. Agency represents and warrants that it has net paid or agreed to pay any compensation, contingent or otherwise, direct or Inched, to solicit or procure this Agreement or any rightsbenefils hereunder. 11. Nondiscrimination. There shall be no discrimination against, or segregation of any persons, of group of persons, on account of race, color, creed, religion, sex, martial status, national origin or ancestry In Me rental, sale, lease, sublease, transfer, use, occupancy, or enjoyment of the PropeM, or any portion thereat, nor shall FRC, or any person claiming under or through FRC, motWish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, Page 5 lessees, subtenants, sublessees or vende ss of the Property, or any porion (hereof (except as permrtad by this Agreement). The nondiscrimination and nonsegregation covenants contained herein shall remain in effect In perpetuity. Agency shall not employ discriminatory practices in Me provision of sonorous, employment of personnel, or in any other respect on the basis of race, religious creed, color, national origin, ancestry, physical disability, mental disability, medical condition, modal status, sex, age, sexual orientation, ethnicity, status as a disabled veteran or veteran of the Vietnam aa, During the performance of thk Agresim nt, Agency agrees as follows: a. Agency will comply with all laws arM regulations, as applicable. No person In the United Sates shall, on the grounds of race, religious teed, color, national origin, ancestry, physical disability, mental disability, medical condltion, marital status, sex, age, sexual orientation, ethnicity, status as a disabled veteran or veteran of Na Vietnam era be excluded from participation in, he denied he benefits of, or be subject to discrimination under any program or activity made possible by or resulting from his Agreement. In. Agency will not discriminate against any employee of applicant for employment because of race, religious creed, color, national origin, ancestry, physical disability, mental disability, medical condition, marital stews, sax, age, sexual orientation, ethnicity, status as e disabled veteran or veteran of the Vlemam ere. Agency shall take affirmative action to ensure that applicants are employed, and the employees are treated during employment, without regard to Meir uses, religious coed, color, national origin, ancestry, physical disability, mental disability, medical condition, marital status, sex, age, sexual orientation, ethnicity, stews as e disabled veteran or veteran of he Vietnam era. Such action shall Include. but not be limited to, the following: employment, upgrading, demotion or transfer, recruitment or recruitment advertising; layoff or tenninatbn; rales of pay or other forms of compensation; and selection for training, including apprenticeship. Agency agrees w post in conspicuous places, available to employees and applicants for employment, notices setting forth the provision of tile nondiscrimination clause. G. Agency will, In all solicitations or advertisements for employees placed by or on behalf of AGENCY, stale that all qualified applicants will recelve consideration for employment without regard to ram, religious creed, color, national origin, ancestry, physical disability, mental disability, medical candidi marital status, sex, age, sexual orientation, ethnicity, status as a disabled version or vatemn of the Vietnam are. a. In the furnishing of he services providad far herein, Agency is acting as an independent connector. Neither Agency, norn any of its ofte, associates, agents or employees shall be disaffect an employee, parmer or agent of FRC for any purpose. However, FRC shall retain the right to wady Mat Agency is performing Its respective obligations in accordance with the more hereof. b. This Agreement does not evidence a partnership or joint venture between Agency and FRC. Agency shall have no authority to bind FRC absent FRC S express written consent. Except M the extent otherwise provided In this Agreement, Agency shall bear its own costs/expenses In pursuit hereof. Page 6 13. Notices. My notice required or Intended to ba given to offer party under the terms of this Agreement shall be In wilting and shall be deemed to be duly given if delivered personally or deposited Into the United States mail, with postage prepaid, addressed to the party b Milch notice is to be given at the palls address set fodh below or at such other address as the parties may from time to time designate by written notice: Agency: Redevelopment Agency of the City of Fresno 2344 Turare Street, Suite 200 Fresno, CA 93721 A": Executive Director FRC: Fresno Revitalization Commerce Us Redevelopment Agency of the City of Fresno 2344 Tulare Street, Suite 200 Fresno, CA 93721 14, Binding. Once this Agreement is signed by all pelves, it shall be binding upon, and shall Inure to the benefit of, all parties, and each parties' respective heirs, successors assigns, transferees, agents, servanh, employees and representatives. 15. Ass'onment. There shall be no assignment by Agency of Its rights or obligations under this Agreement without the prior written appmal of FRC. Any attempted assignment by Agency, its successors or assigns, shall be null all void unless approved in writing by FRC. b. FRC may assign its rights, duties and obligations, title and Interest under this Agreement to a wholly owned single purpose subsidiary of FRQsubject b writes approval by Agency. However, In Me event of such assignment as provided herein. FRC is in no way relieved of any of its responsibilities, and shall remain fully responsible and liable to Agency under Me terns of this Agreement and all related agreements. and FRC shall retain full control and responsibility for the Project. 16. Compliance Wall taw. In providing Me services required under this Agreement, Me Padies shall at all times comply with all applicable laws of Me United States, the State of California and City of Fresno, and with all applicable regulations promulgated by federal, state, regional, or Iocai administrative and regulatory agencies, now in force and as they may be enacted, Issued, or amended during Me tens of this Agreement. 17. WeW lar. The waiver by either parry of a breach by the other of any prevision of this Agree ent shall not constitute a continuing server or a server of any subsequent breach of eitherthe same or a different provision of this Agreement. No provisions of this Agreement may ba waived unless in wriiirg and signed by all parties to Mis Agreement. Waiver of any one prevision herein shall not oe deemed to be a welver of any other provision herein. 18. Governing law and Venue. This Agreement shall b r governed by, and construed and enforced in accordance with, the laws of the State of California. Venue for purposes of the filing of any action regarding the enforcement or interpretation of this Agreement and any rights and du0es hereunder shall he Fresno County. California. Page 19. Headmils. The nation headings in this Agreement are for convenience and reference only and shall not be mnstrued or held in any way to explain, modify or add to the Interpretation or meaning of the provisions of this Agreement. 20. Severebil". The previsions of this Agreement are severable. The Invalidity, or unenforceability of any one provision in this Agreement shall rot effect the other provisions. 21. Interpretation. The parties acknowledge that this Agreement in Its final form is Me mud of the combined efforts of rhe parties and that, should any provision of this Agreement be found m be ambiguous in any way, such ambguity shall not be resolved by construing This Agreement In favor of or against either party, but rather by construing the farms In accordance with their generally accepted meaning. 22. Affamev s Fees. H either party a required to commence any proceeding or legal action to enforce or interpret any tens, covenant or condition of this Agreement, the prevailing pant in such proteadirg or action shall be entitled to recover Prem the other party its reasonable attomey's fees and legal expenses 23. Procedures of Documents. In the event of any conflict between the body of this Agreement and any Exhibit or Attachment heram, the terms and condifions of the body of his Agreement shall control and fake precedence over the terms and conditions expressed within the Exhibit or Attachment Furthepnore, any terms or conditions contained within any Exhibit or Attachment hereto which purport to modify the allocation of risk between the pelves, provided for within the body of this Agreement, shall be null and void. 24. Extent of Agreement Each party acknowledges that they have read and fully understand he contents of his Agreement. This Agreement represents Ne entire and integrated agreement between the parties with respect to the subject matter hereof and supersedes all pnor negotiations, representations or agreements, either written or oral. This Agreement may be modifed only by written Instrument duly authorized and executed by both FRC and Agency. [END — SIGNATURES ON NEXT PAGE Page 8 IN WITNESS W HEREOF, the Agency and FRC have executed this Contractual Sendoes Agreement by duly authorized representafives on the date first written hereinabove. 'AGENCY' ATTEST FRC" Fresno Revitalization Coiporefion A CelMornia Non-ProN Public Benefit Corporeten \L By: Its' Data: f/Lx/fid THE REDEVELOPMENT AGENCY OF THE CITY OF FRESNO, a public hotly, corporate and polific Marlene Murphey Executive Director SI,t IID Date: APPROVED AS TO FORM: REBECCA KLISCH JAMES C. SANCHEZ Ex-Wdo Cleric, Fresno Redevelopment Agency Ex -OR 'o Attorney, Fresno Redevalapment Agency/� (� By: �p�'.�nd �. J/zy/ro BY: & V&'� � a�lo Deputy Page 9 Exhibit A: Legal Description of Property Exhibd At: Plat Map of the Property Exhibit B'. Neighborhood Stahilvation Progoar Agreamrnt Exhibit C: Operating Ag xnnmt between Agency and FRC Exhibit D: Regulatory Agreement Exhibit E: Scope of Work Exhibit F: Purchase and Sale Agreement Exhibit G: Note from Seller to FRC Exhibit N: Certificate of Continuing Program Compliance Page 10 EXHIBIT "A" LEGAL DESCRIPTION OF PROPERTY THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF FRESNO. COUNTY OF FRESNO, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS: Lots 1, 2, 3, 4 and 5 of Tract No 1936, Huntington Holmes Park, In the City of Fresno, County of Fresno. SOW of Cel6ornia, according to the map therad recorded April 26, 19631n Volume 21 Pages 66, 67 and 66 of Plats. Fresno County Records. Excepting therefrom all oil, gas, other hydrocarbon substances and minerals of any kind or character, in, on, or thereuncer, as reserved in deeds of record. I1T� �JSri•T�Sa[ FLAT MAP OF THE PROPERTY EXHIBIT "E" SCOPE OF WORK On the Effei Date of this Agreement. Mw Property is owl by the IMCC Canyon Crest, LLC, a Delaware Limited Liability Company ('Seller'), which acquired the Property through foreclosure. The purpose of tris Agreement is for the Agency to take all actions on behalf of the FRC to acquire the Property from Sellar upon the terms and conditions set forth In the Purchase and Sale Agreement, shown in Exhibit "F to his Agreement; undertake this renovation of six gutted units at Me Property, and provide for the ongoing operason and maintenance of the Property under Me terms of the Regulatory Agreement, shown in Exhibil'D'to this Agreement, including Me establishment of affordability restrictions on Me unite; and, proNtle for Me remarketing Of Me Property to a qualified affordable housing development and property management company. Pursuant to the Operating Agreement, shown In Exhibit 'C' b this Agreement, Mrs Agency shall provide a Loan Guaranty of a Note from Seller to FRC (the Note Is shown in Exhibit "G') for Me acquisition of the Property In Me amount One Million, Nine Hundred Thirty -Seven Thousand, Seven Hundred Ninety -Six Dollars ($1,937,796.00). The convenience of the Property shell be In the form of a Gant Deed. Considerabon for the Loan Guaranty shall be Me performance of the terms and conditions of the Operating Agreement and the Regulatory Agreement. In speech M the guaranty of the Seller's Note, the Agency shall undertake any and all actions on behalf of the FRC to allow FRC to enter an Agreement with the City of Fresno, under which Me City all make a loan from its Neighborhood Stabil tion Program In the amount of $2,772.253 under Me terms and conditions of that Agreement, aitacri as Exhibit V to this Agreement. Agency shall undertake on behalf a FRC all ease necessary for the closing of Mrs acquisition of the Property from Seller, Including but not limited! to Me preparation, execution, and dellvery to the Escrow OFrrar, keriffed in Me Purchase and Sale Agreement, such additional escrow instmctlons consistent with Mw terms herein as shall be reasonably necessary. These tasks may include but are not limited to; e. Determinegon that Title shall be conveyed In a good condition, free and clear of all liens, encumbrances, clouds, conditions, rights of occupancy and possession, except Mose xcepbons to He approved purcuant to Me Purchase and Sale Agreement; the Seller S Deed of Trust; Me City's Deed of Trust; the Loan Guaranty Deed of Trust; and the Regulatory Agreement. b. Through Me Escrow Officer, determine Seller has deposited into escrow a constipate (-FIRPTA Certificate-) In such farts as may be required by Me Internal Revenue Service pursuant to Section 1445 of the Internal Revenue Coda. c. Finalize financing commltmenis Including the City NSP Agreement, the Seller's Note, and the Loan Guaranty for the acquisition and renovation of the Property in accordance with the terms of the Operating Agreement. d. Approve Ma physical and environmental condition of be Property In accordance with the terms of be Operating Agreement. a. Oeposlt into escrow all the documents required under the Purchase and Side Agreement. C Communicate wish the Escrow Officer to determine in writing the fees, charges, and costs necessary to dear title and close escrow, and of any documents which have not been provided by said Path and which must be deposited in Escrow to permit timely Closing. g. At the close of escrow, ensure FRC has received! an ALTA Policy of Title Insurance (the "Title Policy) for the FRC's Interest, wherein the Top Company shall insure that fitie Is be Property shall be vested in FRC, comilning no exception to such title which has rot been approved or walved by FRC in accordance with this Section. The Title Policy shall include any available additional title insurance, assai ed coverage or endorsements net FRC has reasonably requested. h. Ensure the NSP Agreement between FRC and City is recorded. which requires Mat for a period of fifty-five (55) years from occupancy of be Affordable Units (the "Afiora liy Period°), seventybne (71) of the Units on the Property may only ba used for the residential use of housing subject to the terms of that certain NSP Agreement, and which shall bind every successor or assign in Interest of FRO. I. Ensure be Regulatory Agreement between FRO and Agency is recorded, which requires that for a Period of fifty-five (55) years from occupancy of fire Affordable Units (Me `Affordability Period'), one hundred seventeen (11 7) of the Units on the Property may only be used far the residential use of housing subject to the terns of that certain Regulatory Agreement, and which shall bind every successor or all in interest of FRC. Operation, Maintenance d Lanuno of Redden As of the Effective vale of this Agreement, the Property Is managed by Pill Property Management ('Manal which is under contact with Seller to provide on-site and off-site property management services (the "Management Con(red"), Under this Agreement Me Agency shall take all actions on behalf of the FRC to ensure that the Property Is operated and maintained in a first class condition upon the terms and conditions set forth in Me Regulatory Agreement with the currant Manager or any future manager. This includes the transitional tasks of codifying existing apartment asses, Income -qualifying pirating and new tenants, transferring the Management Contract to Me FRC, and acquiring a new property manager for the Property, if necessary. The tasks undertaken by the Agency shall include but are not limited to: a. Initial Lease-uo Period Monthly during be Initial Lease -up Period as defined In Section 130 of be Operating Agreement and annually thereafter. Agency, on behalf of FRC and working with the contract Property Manager, prepare a report with respect to Affordable Units under lease, leases In default, and such other information as Agency may require as shown in the Certificaa of Continuing Program Compliance as shown In Exhibit W to this Agreement. b. Restricted Residences As set fodh above, Agency shall on behalf of FRC enforce Mat each M the Affordable Units shall be rented to an Eligible Tenant for a rental rate which does not exceed an Affordable Rent for the applicable Affordable Unit. Agency shall cause to be produced an operations manual for the income qualification of residents and for the transition from non -restricted units to Restricted Units, including a procedure Mat allows Eligible Over Income Tenants as defined in the Operating Agreement ro ocoupy Lower Income Units and the process whereupon vacated Elgible Over Income Units are leased fo Eligible Lower Income Tenants through the income certification of such tenants income m accordance with the Regulatory Agreement. c. 6ontual Tenancy Rom rt. Agency on behalf of FRC shall annually, by January 31. compile a report on Project occupancy for each Affordable Unit, Including Information concerning the number of months during which each Affordable Unit was occupied, and Me income category of each tenant household occupying an Affordable Unit. d. Issas and Asaessmante. Agency on behalf of FRC shall pay, when due, all real estate taxes and assessments assessed or levied subsequent to conveyance of tltie. Agency shall assist FRC in Me application of a property tax waiver through Me County of Fresno, for a percentage of taxes up to the annually income-coNfi nd percentage of residents. e. Prooarthi Nominal . Agency on behalf of FRC shall undertake all maintenance obligations on Me Property in accordance with and for the term of Me Regulatory Agreement. Agency, shall assume FRC's obligations to maintain the Property, and Agency's remadies in Me event of PRC§ default In performing such obligations, are can forth in the Regulatory Agreement. f. niturince. Prior to conveyance of No to the FRC, Agency shall on behalf of the FRC Procure and maintain insurance policies required under the Operating Agreement, the Seller's Note or Dead of Trust, or Me NSP Agreement, whichever provides for the highest level of coverage. Agency shall procure such coverage on behalf of the FRC during the entire term of ownership by to FRC, with such cost payable from the gross rental receipts of the Property. imorevements on the Proo M As of Me Effective Date of this Agreement, the Property has six gutled units and requires heats and safety upgrades and repairs, as described herein and In the Basic Program of Work in Exhibit E of Me Operating Agreement. Agency shall undertake improvements on the Property on behalf of FRC, pursuant to the Operating Agreement and Me plans and permits approved by Agency and City. Except to the extent of the Agency Financial Assistant, the cost of constructing all of the improvements requiretl to be constructed for Me Property shall be home by FRC from the NSP Agreement and from gross rental receipts of the Property. The tasks undertaken by the Agency shall include but am not limited to a. Exercise reasonable egorts to tlmey submit all documents and Information necessary to obtain all development and building approvals from Me City in a tamely manner. b. Obtain all required City approvals and permits, including site plan review, conditional use permits, builtling, grading, and landscaping as provided in the Operating Agreement. c. Review and approve plans and drawings for all improvements to be made on the Property, including for site plan review, building, grading, landscaping lmd other plans and drawings, es Provided in the Operating Agreement. J. Obtain reliable cost estimates and negotiate and prepare contracts between FRC and general contractor for all of the Improvements inquired to be made by FRC hereunder. Cgmpbhfnmmfth P If W R Agency shall mullet the FRC and take all actions on behalf of FRC to comply with the obligations related to Davis Bacon prevailing wages required in me NSP Agreement and further shown in Section 8.4 of the Opereting Agreement: 'BA Proillotisesoons bTti 93 bl' W rk-P S R be soler 1. FRC shall Y responsible for-ah aspects of FRC's conduct in connection with the Pmject, including but not limited b, compliance with all local, state and federal laws including, without limitation, as to prevailing wage and Public bidding requirements, as applicable. This Projact Is a 'public wink' Project for federal purposes including Davis Bacon and Related Acts wage requirements absent written direction/desurnmation otherwise by U.S. HUD or a court of competent Jurisdiction. Based Inanition FRC shell cause the Protect work to be Perfumed as a'public work.- The City Council of me City of Fresno has adopted Resolution No. 82-297 aecermining the general prevailing rate of Par diem wages and Per diem wages for holidays and overtime in the Fresno area for each call classification, or type of workman needed in the execution of contracts for the City. A COPY of the resolution Is on the at the Office of the Cly Clerk. Actual wage schedules are available upon request at the C" Construction Management Ofica.ility of the Without limbrg the foregoing, FRC shall be solely responsible for the quality antl suitab work comPhred, me supervision of all contrsons acted work, qualRca nd s and financial conditions of and Performance of all contrectors, subconhaclors, consultants and suppliers. Any review or inspection undertaken by the City with reference to the Project and/or pWyroll monitoringraudding is solely for the purpose Of determining whether FRC Is properly discharging its obligation to the City, and shall not be relkid upon by FRC or by any third Parties as a warrant' or representation by me City as to governmental compliance and/or the quality of the work completed for the Project°