HomeMy WebLinkAboutTower 999, LLC - Disposition and Development Agreement - Affordable Housing - 2024DISPOSITION AND DEVELOPMENT AGREEMENT
By and Among the
CITY OF NATIONAL CITY
and
TOWER 999, LLC
DISPOSITION AND DEVELOPMENT AGREEMENT
(Tower 999)
THIS DISPOSITION AND DEVELOPMENT AGREEMENT ("Agreement") is dated as
O
of the 10 day of b V 2024, by and between the City of National City ("City") and
Tower 999, LLC, a Nevada limited liability company ("Developer").
RECITALS
A. The City is the owner of certain real property generally located at 921, 925, and
929 National City Boulevard (APN's 556-471-03 and 556-471-04) more particularly described on
Exhibit A attached hereto (collectively, the "City Property"). The City now desires to make
beneficial use of the underutilized City Property to generate affordable housing in furtherance of
its housing objectives and in compliance with local and state law.
B. Developer is the owner of certain real property generally located at 999 National
City Boulevard (APN 556-471-17), more particularly described in Exhibit B attached hereto
("Developer Property"). The Developer Property is adjacent to the City Property. The Developer
Property and City Property are collectively referred to herein as the "Project Property."
C. Developer desires to acquire the City Property from the City. Developer proposes
to and thereafter develop a seven -story, mixed -use building with approximately 9,294 square feet
of ground floor retail/commercial space and approximately 127 residential dwelling units
(collectively, the "Project") on the Project Property, and has expressed a desire, willingness, and
capability to take on the expense, resources, and time necessary to maximize the Project Property's
beneficial use of the Project Property in furtherance of the City's housing objectives. Closing shall
be contingent upon the City and Developer agreeing, in writing, to the actual number of residential
dwelling units to be developed on the Project Property.
D. The purpose of this Agreement is to provide the terms and conditions for the sale
and transfer of the City Property to the Developer and to set forth the terms and conditions for
the Developer's construction of the Project on the Project Property.
NOW, THEREFORE, for good and valuable consideration, the receipt of which is hereby
acknowledged, City, Developer hereby agree as follows:
100. Definitions.
"Affordable Units" means the forty percent (40%) of the total dwelling units in the Project
(byway of example only, if there will be 127 total units in the Project, then 40%= 51 Affordable
Units), which will be restricted for a period of fifty-five years after the Completion of Construction,
for occupancy by Very Low -Income Households and Low -Income Households. Of the Affordable
Units, at least fifty percent (50%) shall be restricted for occupancy only by Very Low -Income
Households at monthly rental rates that do not exceed the Maximum Rents for Very Low -Income
Households, and the balance of the Affordable Units shall be occupied by Low -Income
Households at monthly rental rates that do not exceed the Maximum Rents -Low -Income
Households set forth in more detail in the Regulatory Agreement. Fractions resulting from the
calculation of the number of Affordable Units restricted to Very Low -Income Households shall be
rounded up, and Affordable Units restricted to Low -Income Households shall be rounded down.
"Agreement" means this Disposition and Development Agreement between the City and
the Developer.
"Area Median Income" or "AMI" shall mean the area median income defined by the U.S.
Department of Housing and Urban Development (HUD) as the then -current area median income
for the San Diego -Carlsbad Metropolitan Statistical Area, as adjusted for family size. When
determining income eligibility, the Developer shall use the actual household size of the prospective
tenant(s). When determining rents, the Developer shall use the household size appropriate for the
Affordable Unit.
"City" means the City of National City, a California municipal corporation.
"City Property" means that certain real .property is generally located at 921, 925, and 929
National City Boulevard (APN's 556-471-03 and 556-471-04), more particularly described in
Exhibit A attached hereto.
"Close" or "Closing" means the Developer's closing on the acquisition of the City Property
and all funding necessary to construct the Project.
"Closing Deadline" means December 31, 2025; provided, however, in the event, the
Developer is not then in default under this Agreement, the Closing Deadline: (a) may be extended,
at the Developer's sole discretion, for a period of up to one (1) year (i.e., until December 31, 2026)
if, the Federal Reserve's Federal Funds rate as of December 31, 2025, has not decreased by one
hundred (100) or more basis points from that interest rate in effect on the date this Agreement is
executed by all parties and/or Developer has not secured a low-income housing tax credit for the
Project; or (b) may be extended, at the Developer's written request to the City Manager, and in the
sole discretion of the City Manager, for a period of up to six (6) months.
"Completion of Construction" shall occur upon the filing or the issuance by the building
official of the City of a temporary certificate of occupancy for the residential component of the
Project.
"Construction Deed of Trust" means the deed of trust recorded against the Project Property
for the purpose of obtaining senior construction financing for the Project.
"Default" means the failure of a party to perform any action or covenant required by this
Agreement within the time periods provided herein following notice and opportunity to cure, as
set forth in Section 500.1 hereof.
"Developer" means Tower 999, LLC, a Nevada limited liability company. Where the term
Developer is used herein, such term shall include any permitted nominee, assignee or successor in
interest as herein provided.
"Developer Property" means that certain real property is generally located at 999 National
City Boulevard (APN 556-471-17), more particularly described in Exhibit B attached hereto.
"Due Diligence Period" means the period of time commencing on the date this Agreement
is executed by the City and ending at 5:00 p.m. Pacific Standard Time on June 30, 2025.
"Escrow" means the escrow depository and disbursement services to be performed by
Escrow Agent pursuant to the provisions of this Agreement.
"Escrow Agent" means Chicago Title Company or another title insurance company
mutually selected by the parties hereto.
"Escrow Instructions" shall mean the escrow instructions to be executed by the City and
Developer with respect to the Closing.
"Final Project Budget" means a budget prepared by the Developer, and approved in the
sole discretion of the City Manager, setting forth all sources and uses for the construction of the
Project and all projected income and expenses for the operation of the completed Project. City
Manager shall complete its review of said budget within fifteen (15) business days and not
unreasonably withhold, condition, or otherwise delay approval.
"Governmental Requirements" means all laws, ordinances, statutes, codes, rules,
regulations, orders, and decrees of the United States, the state, the county, the City, or any other
political subdivision in which the Project Property is located, and of any other political subdivision,
agency or instrumentality exercising jurisdiction over City, Developer or the Project Property.
"Hazardous Materials" means any hazardous or toxic substance, material or waste which
is or becomes regulated by any local governmental authority, the State of California or the United
State Government. Provided, however, .the term "Hazardous Materials" shall not include
substances typically used in the ordinary course of developing, operating and maintaining
apartment complexes in California, or small amounts of chemicals, cleaning agents and the like
commonly employed in routine household uses in a manner typical of occupants in other similar
properties, provided that such substances are used in compliance with applicable laws.
"Initial Project Budget" means the proforma budget attached hereto as Exhibit C and as
further set forth in Section 301.1.
"Low -Income Household" means persons and families whose income does not exceed
eighty percent (80%) of the then -current Area Median Income, provided that such persons or
families meet the additional requirements set forth in the Regulatory Agreement.
"Maximum Rents -Low -Income Households" shall mean the maximum amount of
consideration, of any kind whatsoever, that the Developer may receive, which monthly amount
shall not exceed the product of one -twelfth (1/12) of thirty percent (30%) sixty percent (60%) of
the -then Area Median Income as adjusted for household size appropriate for the Affordable Unit,
less the utility allowance as determined in accordance with the utility allowance schedule
published annually by the CDC -HA.
"Maximum Rents -Very Low -Income Households" shall mean the maximum amount of
consideration, of any kind whatsoever, that the Developer may receive, which monthly amount
shall not exceed the product of one -twelfth (1/12) of thirty percent (30%) of fifty percent (50%) of
the then Area Median Income as adjusted for household size appropriate for the Affordable Unit,
less the utility allowance as determined in accordance with the utility allowance schedule
published annually by the CDC -HA.
"Permanent Deed of Trust" means the deed of trust recorded against the Project Property
for purposes of obtaining senior permanent financing for the Project.
"Permitted Transfer" is defined in Section 601.2, below.
"Project" means the seven -story, mixed -use building with approximately 9,294 square feet
of ground floor retail/commercial space and approximately 127 residential dwelling units the
Developer shall construct on the Project Property, subject to further refinement by the Developer
prior to Closing and approval by the City Manager in his reasonable discretion.
"Project Deed of Trust" means the subordinate deed of trust, in forms agreed to by the City
and Developer, to be executed by the Developer and recorded against the Project Property at
Closing. The Project Deed of Trust shall be subordinated to the Construction Deed of Trust and
Permanent Deed of Trust. Any such subordination shall be in a form acceptable in the reasonable
discretion of the City Manager.
"Project Design and Plan" means the design and plan for the Project, which shall set forth
the design, plan, and construction work, including, without limitation, landscaping, flatwork, and
similar work, to be done with respect to the Project, which shall be subject to the approval of the
City Manager, which approval shall not be unreasonably withheld, conditioned or delayed.
"Project Property" means, collectively, the Developer Property and City Property.
"Purchase Price" means the fair market value purchase price payable by the Developer to
the City in exchange for title and ownership of the City Property.
"Regulatory Agreement" means a regulatory agreement, in a form and format approved by
the City in the City's sole discretion, which shall restrict the rent and occupancy of the Affordable
Units for fifty-five (55) years. The Regulatory Agreement shall require the Developer to pay an
annual occupancy monitoring fees imposed by the City.
"Very Low -Income Household" means persons and families whose income does not
exceed fifty percent (50%) of the then -current Area Median Income, provided that such persons
or families meet the additional requirements set forth in the Regulatory Agreement.
200. Transfer of the City Property.
200.1 Due Diligence.
200.1.1 Due Diligence Period. During the Due Diligence Period, the
Developer may determine, in the Developer's sole and absolute discretion, whether to proceed
with the purchase of the City Property. During the Due Diligence Period, the Developer may
terminate this Agreement for any reason or for no reason at all by delivering written notice of such
termination to the City and Escrow Agent. After the expiration of the Due Diligence Period, the
Developer's right to terminate this Agreement for any reason, or for no reason at all, shall expire.
If this Agreement is terminated during the Due Diligence Period, then: (i) all rights and liabilities
of the City and Developer with respect to this Agreement shall immediately terminate, except for
rights and liabilities that specifically survive such termination; (ii) Escrow Agent shall return to
the Developer all funds or other things deposited in Escrow by the Developer, less any fees and
costs charged by the Escrow Agent; and (iii) Escrow Agent shall return to the City all funds or
other things deposited in Escrow by the City.
200.1.2 Access and Cooperation. During the Due Diligence Period, the
Developer and its representatives, consultants and attorneys shall have access to the City Property.
Developer shall provide the City with copies of all surveys, studies and tests obtained by Developer
with respect to the Project Property. Such access shall be at the sole risk and expense of Developer.
Developer shall indemnify and defend the City, and shall hold the City, the City's agents and
employees, and the City Property harmless from any actions, losses, costs, damages, claims and/or
liabilities, including but not limited to mechanics' and materialmen's liens and attorney fees,
proximately caused by the actions of Developer and/or its contractors or agents (including
Developer's Consultants, as defined below) upon the City Property. The Developer shall not
permit any mechanic's, materialman's, contractor's, subcontractor's or other lien arising from any
work done by the Developer or its agents pursuant to this Agreement to stand against the City
Property. If any such lien shall be filed against the City Property, the Developer shall cause the
same to be discharged or bonded by payment, deposit, bond, or otherwise within thirty (30)
calendar days after actual notice of such filing. The Developer's obligations under this Section
shall survive the termination or expiration of this Agreement. If the Developer desires to do any
invasive testing at the City Property, the Developer may do so only after obtaining the City's prior
written consent to the same, which consent may be withheld or granted on conditions to the City's
satisfaction, provided, however, such consent shall not be unreasonably withheld or delayed if
such invasive testing will be for the purpose of further investigation of a known condition and such
invasive testing is recommended by a qualified specialist. The Developer shall promptly restore
the Project Property to the condition the City Property was in immediately prior to any tests or
inspections conducted pursuant to this Section at the Developer's sole cost and expense. The
Developer shall provide the City with all plans, drawings, and specifications ("Invasive Testing
Plans") that define to the satisfaction of the City the invasive testing to be performed on the City
Property and the names of all environmental and other consultants, contractors and subcontractors
who will be performing such invasive testing (collectively "Developer's Consultants"). The
Developer shall deliver the names of the Developer's Consultants and the Invasive Testing Plans
to the City concurrently with its request to the City that the Developer desires to perform invasive
testing (unless the names of Developer's Consultants have previously been provided to the City).
Before any of Developer's Consultants or other contractors, consultants or agents acting for or on
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behalf of the Developer enter onto the City Property, Developer; and (2) shall furnish to the City
evidence that the Developer's Consultants or other contractors, consultants or agents of Developer
have procured commercial general liability insurance from an insurer authorized to do business in
the State of California, which is reasonably acceptable to City, insuring against claims for bodily
injury, death or damage to property in a single limit amount of not less than $1,000,000.00,
endorsed to name City as an additional insured.
200.1.3 "As -Is." "Where -Is." The City has not investigated and makes no
representations or warranties whatsoever regarding the condition of any of the City Property.
Developer hereby agrees to take title to the City Property in its "as -is," physical and environmental
condition, with no warranty, express or implied, by the City as to the condition of any existing
improvements, the soil, its geology, the presence of known or unknown faults or Hazardous
Materials or toxic substances, and Developer shall have the sole responsibility at its own expense
to investigate and determine the physical and environmental conditions of City Property. The City
Property shall be conveyed to the Developer in an "as -is" physical and environmental condition,
with no warranty, express or implied, by the City as to the condition of any existing improvements,
the soil, its geology, the presence of known or unknown faults or Hazardous Materials or toxic
substances, and it shall be the sole responsibility of the Developer at its expense to investigate and
determine the physical and environmental conditions. Prior to Closing, the Developer shall have
the right to engage its own environmental consultant (the "Environmental Consultant") and other
consultants to make such investigations of the City Property as the Developer deems necessary,
including any soils, geotechnical, and other testing of the City Property, and the City shall promptly
be provided a copy of all reports and test results provided to the Developer by the Environmental
Consultant. It shall be the sole responsibility and obligation of the Developer to take such action
as may be necessary to place the physical and environmental conditions of the City Property in a
condition entirely suitable for the purposes set forth in this Agreement.
201. Consideration. The Purchase Price is Fifty Thousand Dollars ($50,000.00).
202. Escrow. Concurrently with the City's execution and delivery of this Agreement to
the Developer, the Developer shall open the Escrow with Escrow Agent to facilitate the Closing
and recordation of the grant deed and such other matters as required under this Agreement. The
parties will execute the Escrow Instructions prior to the Closing, which Escrow Instructions shall
provide for the order of recordation, distribution of original documents, and other provisions
customarily contained in escrow instructions. Upon the parties' execution of the Escrow
Instructions, the Developer shall deposit three percent (3%) of the Purchase Price (i.e., $1,500.00;
the "Earnest Money") into Escrow within five (5) calendar days, which amount shall be credited
toward the Purchase Price upon Closing and shall be refunded to the Developer in the event this
Agreement is terminated for any reason and the Closing does not occur. Upon Closing, Developer
shall deposit the balance of the Purchase Price, the sum of Forty -Eight Thousand Five Hundred
Dollars ($48,500.00), into the Escrow, which sum along with the Earnest Money shall be released
to the City by the Escrow Officer upon transfer of title of the City Property to the Developer. The
Developer shall pay all fees, charges, and costs which arise from Escrow, as well as all
documentary transfer taxes due with respect to the Developer's acquisition of the City Property.
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203. Conditions to Closing.
203.1 Closing Conditions in Favor of Both Developer and City. The Closing is
conditioned upon satisfaction or waiver of each and all of the conditions set forth in this Section
203.1, and its subparts, on or before the Closing Deadline. In the event that one or more of these
conditions are not satisfied on or before the Closing Deadline, then this Agreement shall be
terminated, unless the City and the Developer waive satisfaction of such condition or conditions
in writing, in which event the Closing shall proceed, and the parties waive any right to damages or
compensation with respect to the unsatisfied condition.
(a) Proiect Design and Plan. Developer shall have obtained approval
from the City of National City for the Project Design and Plan, including, without
limitation, the actual number of residential dwelling units and the number of Affordable
Units to be constructed on the Project Property. The Developer will seek to secure an off -
site parking in proximity to the Project. However, the absence of such a solution will not
impede the project's progress under the California Legislation AB 2097, which prohibits a
public agency from imposing any minimum parking requirement on any residential,
commercial, or other development project that is located within 1/2 mile of public transit.
(b) Entitlements and Environmental Compliance. The Developer shall
have secured any and all land use and other entitlements, permits and approvals which may
be required for completion of the Project, including without limitation all approvals
required under the California Environmental Quality Act (the "Entitlements") and the
Developer shall have adopted, and the City shall have approved, an environmental
remediation plan, if necessary. The Developer shall have paid any and all applicable fees
(including, without limitation, community facility district fees and public facilities fees due
at that time as imposed by the City or any other governmental agency having jurisdiction
with respect to the Project) (collectively, the "City and Permit Fees") or shall pay such fees
concurrently with Closing. The execution of this Agreement does not constitute the
granting of or a commitment to obtain any required Entitlements.
(c) Title Policy. Escrow Agent is prepared and irrevocably obligated to
cause to be issued: (i) a title policy insuring the Developer's fee ownership of the City
Property; and (ii) a title policy insuring the City's Project Deed of Trust.
(d) Forms of Documents. The City and the Developer have agreed (or
will agree prior to Closing) to the forms of the grant deed, Regulatory Agreement and
Project Deed of Trust, and all other documents reasonably necessary to complete the
Closing.
(e) Financing. All of the following shall have occurred: (i) City shall
have approved in writing all of the Developer's proposed acquisition, construction, and
permanent financing for the Project; (ii) concurrently with the Closing, the Developer shall
have closed on all of the City -approved financing necessary to acquire the City Property
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and construct the Project; and (iii) Developer shall have obtained commitments for all of
the City -approved permanent financing of the Project.
(t) Taxing Entities. Approvals have been obtained from all affected
taxing entities with respect to the transfer of the City Property from the City to the
Developer.
203.2 Closing Conditions for the Benefit of the City. The City's obligation to
Closing is conditioned upon satisfaction (or waiver) of each and all of the conditions set forth in
this Section 203.2 on or before the Closing Deadline. Any such waiver shall be effective only if
the same is (i) expressly waived in writing, signed by the City or by email from the City, and (ii)
delivered or emailed to the Developer and Escrow Agent. In the event that one or more of the
conditions set forth in this Section 203.2 are not satisfied or expressly waived on or before the
Closing Deadline, the City (provided the City is not in default hereunder) may unilaterally
terminate this Agreement by mailing or emailing notice of conditional termination to the
Developer and Escrow Agent. After receipt of any such notice of conditional termination, the
Developer shall have ten (10) business days to cure any non -satisfaction of a condition or other
default specified in the notice of conditional termination, or such time as may be commercially
reasonable to cure in the event ten (10) business days is impracticable. If such matter is satisfied
or cured prior to the expiration of such ten (10) day period, then the Closing shall proceed. If such
matter remains unsatisfied or the default remains uncured after the expiration of said cure period,
then this Agreement shall terminate. Any such termination of this Agreement shall not release the
Developer from liability under this Agreement.
(a) No Default. The Developer is not in default of any of its obligations
under the terns of this Agreement, and all representations and warranties made by the same
to the City contained herein shall be true and correct in all material respects.
(b) Insurance. The Developer shall have provided proof of insurance as
required in Section 301.3.
(c) Attorneys' and Experts' Fees. The Developer has paid prior to or
will pay concurrently with the Closing all consultants', experts', and attorneys' fees
reasonably incurred by the City with respect to the same.
(d) Deposit of Documents. The Developer has delivered to Escrow
Agent duly executed and notarized originals of the Regulatory Agreement, Deed of Trust,
and all other documents reasonably required by the City.
(e) Additional Documents. The deposit by the Developer into Escrow
of all other documents and instruments reasonably required by the Escrow Agent.
Budget.
(f) Final Proiect Budget. The City shall have approved the Final Project
V,
(g) Performance and Payment Bond. The Developer shall have caused
its contractor to post security in the form of a performance and payment bond for the Project
in an amount not to exceed the value of the construction contract and in a form acceptable
to the City in its reasonable discretion, to assure the completion of the Project Design and
Plan. The performance and payment bond shall insure that construction completion based
on the Project Design and Plan is timely accomplished, free and clear of mechanic's liens,
stop notices, and other encumbrances concerning the provision of material, labor, and
supplies. Upon a failure by the Developer to timely perform its requirements under the
terms of this Agreement, the City may resort to the performance and payment bond to
ensure the performance of this Agreement by either requiring the bonding company, or its
designees, to comply with the terms of this Agreement, or at the election of the City, by
requiring the bonding company to pay all costs necessary for the City, to take over and
complete the construction as contemplated under the Project Design and Plan at the cost
and expense of the bonding company.
(h) Construction Contract. The construction contract for the Project
shall have been executed by the Developer and the general contractor who has been
selected by the Developer to do the work. The general contractor and the construction
contract for the Project shall be subject to the approval of City, which approval shall not
be unreasonably withheld, conditioned or delayed.
(i) FIRPTA. The deposit by Developer into Escrow of Developer's
affidavit that Developer is not a foreign person and is a "United States Person" as such
term is defined in Section 7761(a)(30) of the Internal Revenue Code of 1986, in the form
prescribed by federal regulations.
6) FTB Form 590. The deposit by Developer into Escrow of a duly
executed FTB Form 590 or other evidence that withholding is not required by the Revenue
and Taxation Code of California.
(k) Surplus Land Act Compliance. The proposed transfer of the City
Property to Developer has been definitively determined to have satisfied the requirements
of the California Surplus Land Act have been satisfied with respect to the transfer of the
City Property to Developer.
203.3 Closing Conditions for the Benefit of the Developer. The Developer's
obligation to Close is conditioned on satisfaction or waiver of each and all of the conditions set
forth in this Section 203.3 on or before the Closing Deadline. Any such waiver shall be effective
only if the same is (i) expressly waived in writing, signed by, or by email from, the Developer, and
(ii) delivered or emailed to the City and Escrow Agent. In the event that one or more of the
conditions set forth in this Section 203.3 are not satisfied or expressly waived on or before the
Closing Deadline, the Developer may unilaterally terminate this Agreement by mailing or emailing
notice of conditional termination to the City and Escrow Agent. After receipt of such notice of
conditional termination, the City shall have ten (10) business days to cure any non -satisfaction of
a condition or other default specified in the notice of conditional termination. If such matter is
satisfied or cured prior to the expiration of such ten (10) business day period, or such time as may
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be commercially reasonable to cure in the event ten (10) business days is impracticable, then the
Closing shall proceed. If such matter remains unsatisfied or the default remains uncured after said
cure period, then this Agreement shall terminate. Any such termination of this Agreement shall
not release the City from liability under this Agreement.
(a) No Default. The City is not in default in any of its obligations under
the terms of this Agreement and all representations and warranties of the City contained
herein shall be true and correct in all material respects.
(b) Deposit of Documents. The City has delivered to the Escrow Agent
duly an executed and notarized original of the grant deed and counterpart original of the
Regulatory Agreement.
(c) Additional Documents. The deposit by the City into Escrow of all
other documents and instruments reasonably required by Escrow.
204. Default. Notwithstanding Section 500.1, below, or anything contained
herein to the contrary, in the event of any Default after the Closing, but prior to Completion of
Construction beyond any applicable cure period (which cure period shall reasonably be extended
to practicably permit cure to commence and/or conclude), in the performance of any of the material
terms, covenants and conditions contained in this Agreement or any document or instrument
executed by the Developer in conjunction with this Agreement; (iii) any prior or junior note
secured by an encumbrance on the Project Property; (iv) in the event of the filing of a bankruptcy
proceeding by the Developer; or (v) in the event of the filing of a bankruptcy against the Developer
which is not dismissed within ninety (90) days of filing, then the Developer shall, immediately
upon demand from the City, convey the City Property to the City. If the Developer fails to
immediately, upon demand from the City, convey the City Property to the City, then: (a) the City
shall have the right to foreclose under the Project Deed of Trust; and (b) City shall be released
from any and all obligations to Developer under the terms of this Agreement. These remedies shall
be in addition to any and all other rights and remedies available to City, either at law,or in equity.
205.Representations and Warranties.
205.1 City Representations and Warranties. The City represents and warrants to
Developer that the City has the full right, power and lawful authority to grant, sell and convey the
City Property to the Developer as provided herein and lawful authority to take all actions and
undertake all obligations required of the City under this Agreement.
205.2 Developer's Representations and Warranties. The Developer represents and
warrants to City as follows:
(a) Authori . The Developer is a Nevada corporation authorized to do
business in the State of California. The persons executing this Agreement on behalf of the
Developer have all necessary authority to execute this Agreement on behalf of Developer,
and this Agreement is a binding obligation of Developer. Execution of this Agreement shall
not result with the passage of time or the giving of notice or both in breach of or in
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acceleration of performance under any contract or document to which Developer may be a
party. A true and complete certificate of good standing, issued by the California Secretary
of State shall have been delivered to the City prior to the execution of this Agreement and
again within ten (10) calendar days of Closing. Developer has the full right, power, and
lawful authority to purchase and accept the conveyance of the City Property and to
undertake all obligations as provided herein, and the execution, performance, and delivery
of this Agreement by Developer has been fully authorized by all requisite actions on the
part of Developer.
(b) No Conflict. Developer's execution, delivery and performance of its
obligations under this Agreement will not constitute a default or a breach under any
contract, agreement or order to which the Developer is a party or by which it is bound.
(c) No Bankruptcy. Developer is not the subject of a bankruptcy
proceeding.
(d) Rent and Occupancy Restrictions. Developer shall at all times after
the Closing during the 55-year term comply with the requirements of the Regulatory
Agreement.
206. Post -Closing Condition of the Project Property.
206.1 Developer Precautions After Closing. From and after the Closing,
Developer shall take all necessary precautions to prevent the release of any Hazardous Materials
in, on or under the Project Property. Such precautions shall include compliance with all
Governmental Requirements with respect to Hazardous Materials. In addition, Developer shall
install and utilize such equipment and implement and adhere to such procedures as are consistent
with commercially reasonable standards as respects the disclosure, storage, use, removal and
disposal of Hazardous Materials.
206.2 Required Disclosures After Closing. From and after the Closing,
the Developer shall notify the City, and provide the City with a copy or copies, of all
environmental permits, disclosures, applications, entitlements, or inquiries relating to the Project
and the Project Property, including notices of violation, notices to comply, citations, inquiries,
clean-up or abatement orders, cease and desist orders, reports filed pursuant to self -reporting
requirements and reports filed or applications made pursuant to any Governmental Requirements
relating to Hazardous Materials and underground tanks. Developer shall report to the City, as soon
as commercially reasonable after each incident, any unusual or potentially important incidents with
respect to the environmental condition of the Project or the Project Property. In the event of a
release of any Hazardous Materials into the environment, the Developer shall, as soon as possible
after the release, deliver to the City a copy of any and all reports relating thereto and copies of all
correspondence with governmental agencies relating to the release. Upon request, the Developer
shall deliver to the City a copy or copies of any and all other environmental entitlements or
inquiries relating to or affecting the Project or the Project Property including, but not limited to,
all permit applications, permits, and reports including, without limitation, those reports and other
matters which may be characterized as confidential.
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207. Developer Indemnity. From and after the Closing, the Developer agrees to and shall
indemnify, defend, and hold the City harmless from and against any claim, action, suit, proceeding,
loss, cost, damage, liability, deficiency, fine, penalty, punitive damage, or expense (including,
without limitation, attorneys' fees), resulting from, arising out of, or based upon any of the
following: (i) the presence, release, use, generation, discharge, storage or disposal of any
Hazardous Materials on, under, in or about, or the transportation of any such Hazardous Materials
to or from, the Project Property, or (ii) the violation, or alleged violation, of any statute, ordinance,
order, rule, regulation, permit, judgment or license relating to the use, generation, release,
discharge, storage, disposal or transportation of Hazardous Materials on, under, in or about, to or
from, the Project Property. This indemnity shall include, without limitation, any damage, liability,
fine, penalty, parallel indemnity after closing cost or expense arising from or out of any claim,
action, suit, or proceeding for personal injury (including sickness, disease, or death), tangible or
intangible property damage, compensation for lost wages, business income, profits or other
economic loss, damage to the natural resource or the environment, nuisance, contamination, leak,
spill, release or other adverse effect on the environment. This indemnity does not include any
condition arising solely as a result of the negligence or willful misconduct of the City or its
employees, agents, representatives, predecessors, successors, or assigns.
300. Scope of Construction.
300.1 City Review and Approval of the Project Design and Plan. Developer shall
prepare and submit a Project Design and Plan for the Project to the City for review and approval.
The City shall have the right to review and approve or disapprove all aspects of the Project Design
and Plan. Developer acknowledges and agrees that the City is entitled to approve or disapprove
the Project's Design and Plan for the Project.
300.2 Standards for Disapproval. The City Manager shall have the right to
disapprove in its reasonable discretion any of the Project Design and Plan for the Project, as set
forth in Section 300.1, above, including without limitation if the same does not conform to this
Agreement or is otherwise incomplete. In the event the Project Design and Plan is not approved,
the City shall state in writing provided to the Developer each of the reasons for disapproval.
Developer, upon receipt of notice of disapproval from the City, shall meet and confer with the City
Manager to resolve any disapproved aspects of the Project Design and Plan, and shall resubmit the
revised Project Design and Plan as soon as practicably possible thereafter for approval. The City
Manager and Developer agree to work together in good faith to resolve any disagreements and
disputes regarding the Project Design and Plan. Developer shall not be entitled to any monetary
damages or compensation as a result of the City Manager's disapproval or failure to approve or
disapprove any Project Design and Plan.
300.3 Revisions. If the Developer desires to propose any revisions to the Project
Design and Plan after approval, the Developer shall submit such proposed changes to the City
Manager. If the Project Design and Plan, as modified by the proposed changes, generally and
substantially conforms to the requirements of the Project Design and Plan and this Agreement, the
City Manager shall review the proposed changes and notify the Developer in writing within thirty
(30) calendar days after submission to the City whether the proposed change is approved or
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disapproved. The City Manager is authorized to approve changes to the Project Design and Plan.
Provided, however, the City Manager shall have no obligation to approve any change from the
basic use set forth in this Agreement.
300.4 Defects in Plans. The City shall not be responsible or liable in any way,
either to the Developer or to any third parties, for any defects in the Project Design and Plan, or
for any structural or other defects in any work done according to the approved Project Design and
Plan, or for any delays caused by the review and approval processes established by this Section
300. Developer shall hold harmless and indemnify the City and its officers, employees, agents,
and representatives from and against any and all claims, demands, and suits for damages to
property or injuries to persons arising out of or in any way relating to the Project Property,
including without limitation any defects in the Project Design and Plan, violation of any laws, and
for defects in any work done according to the approved Project Design and Plan or for defects in
work performed by Developer or any contractor or subcontractor of Developer.
300.5 Land Use Approvals. Before commencement of the work or any works of
improvement at the Project Property as contemplated under the Project Design and Plan,
Developer shall, at Developer's sole expense, secure or cause to be secured any and all
Entitlements which may be required for the Project Design Work and Plan by the City or any other
governmental agency affected by such construction or work. The execution of this Agreement does
not constitute the granting of or a commitment to obtain any required Entitlements or approvals.
300.6 Construction Commencement and Completion. Not later than sixty (60)
calendar days following the Closing, or as soon as commercially practicable thereafter, Developer
shall commence construction of the Project and shall continue such construction diligently and
without substantial delay in a good and workmanlike manner. Developer will complete the Project
substantially in accordance with the plans and specifications approved by the City, including any
additional specifications prescribed by the City at or before Closing, and in compliance with all
requirements of governmental authorities having or asserting jurisdiction. No material change
shall be made in the plans and specifications approved by the City, including any additional
specifications prescribed by the City, without the City's prior written consent, which written
consent or disapproval shall be made by the City within seven (7) business days. The City shall
approve material design revisions provided the same are a logical evolution of the design and
preserve the integrity of the Project as previously approved by the City. Failure of the City to
provide its written consent or disapproval within seven (7) business days shall be deemed consent
to the material change. For purposes of this Section, "material change" means changes which, in
aggregate, increase or decrease the rehabilitation and construction costs by one percent (1%) or
more of the total Project cost. Completion of Construction shall occur not later than thirty (30)
months from the Closing. Failure to complete all of the work contemplated under the Project
Design and Plan for the Project shall, inter alia, be a default by the Developer, entitling the City to
exercise all of its rights and remedies, including without limitation foreclosure of the Deed of
Trust.
301. Cost of Project. All costs of the Project whatsoever shall be borne by the Developer,
including without limitation the cost of planning, the payment of any required prevailing wages,
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if any, designing, developing, and constructing the Project in accordance with the Project Design
and Plan.
301.1 Initial Project Budget. The Developer has submitted the Initial Project
Budget to the City. The Initial Project Budget summarizes the current estimates of the sources and
uses of funds for the complete development of the Project. By its execution of this Agreement, the
City has given its approval to the Initial Project Budget.
301.2 Final Proiect Budget. Once the City and the Developer have agreed upon
final sources and uses for the Project Design and Plan, then the parties shall replace the Initial
Project Budget with the Final Project Budget, which shall include development sources and uses
and an operating budget.
301.3 Insurance Requirements. Developer shall take out and maintain during the
term of the Regulatory Agreement, and Developer shall cause Developer's general contractor and
subcontractors to take out and maintain until Completion of Construction of the Project, a
commercial general liability policy in the amount of not less than $4,000,000 combined single
limit policy for the general contractor and not less than $2,000,000 combined single limit policy
for subcontractors, and a commercial automobile liability policy in the amount of $2,000,000
combined single limit, or such other policy limits as the City may approve in its discretion,
including contractual liability, as shall protect the Developer and the City from claims for such
damages covered by the policies; the policy limits required herein may be achieved through the
use of a combination of primary and umbrella/excess liability policies. Such policies shall be
written on an occurrence form. Developer shall also famish or cause to be famished to the City
evidence satisfactory to the City that the Developer, and any contractor with whom the Developer
has contracted for the performance of work on the Project or otherwise pursuant to this Agreement,
carries workers' compensation insurance as required by law, which shall include a waiver of
subrogation endorsement in favor of the City. The Developer shall furnish a certificate of
insurance countersigned by an authorized agent of the insurance carrier. This countersigned
certificate shall name the City and its respective officers, agents, and employees as additionally
insured parties under the policy, and the certificate shall be accompanied by a duly executed
endorsement evidencing such additional insured status. The certificate and endorsement by the
insurance carrier shall contain a statement of obligation on the part of the carrier to notify the City
of any material change, cancellation, or termination of the coverage at least ten (10) calendar days
in advance of the effective date of any such material change, cancellation or termination; should
the insurer not be able to afford the City such notice, then the responsibility to provide the City
such notice shall be borne by the Developer. Coverage provided hereunder by the Developer shall
be primary insurance and not be contributing with any insurance maintained by the City and the
policy shall contain such an endorsement. The insurance policy or the endorsement shall contain
a waiver of subrogation for the benefit of the City. The required certificate shall be furnished by
the Developer prior to Closing. Insurance shall be written with only insurers authorized to conduct
business in California with a current policy holder's alphabetic and financial size category rating
of not less than A: VII according to the current Best's Key Rating Guide or a company of equal
financial stability that the City approves. In the event coverage is provided by non -admitted
"surplus lines" carriers, they must be included on the most recent List of Approved Surplus Line
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Insurers maintained by the California Department of Insurance and otherwise meet rating
requirements set forth herein.
302. Additional Indemnity. The Developer shall be responsible for all injuries to persons
and/or all damages to real or personal property of the City or others caused by or resulting from
the negligence of the Developer, and/or breach of this Agreement by the Developer, or its
employees, subcontractors and/or their agents during the term of this Agreement. The Developer
shall defend and hold harmless and indemnify the City and all of its officers and employees from
all costs, damages, judgments, expenses, and claims to any third party resulting from the
negligence and/or breach of this Agreement, by the Developer or its directors, officers, partners,
members, employees, subcontractors and/or their agents and assigns or any employee, director,
officer, partners or member of Developer arising out of the development of the Project Property
and/or the breach of this Agreement, except those arising from the sole negligence or willful
misconduct of the City, its employees, representatives, agents, contractors, and/or officials.
303. Rights of Access. Upon forty-eight (48) hours' written notice provided by the City,
the Developer agrees to allow the City and its representatives to access the Project Property to
review and inspect compliance with the terms of this Agreement pertaining to the construction of
the Project in accord with the Project Design and Plan. The City shall monitor the Developer's
activities without liability for said inspection and review. This Section shall not be understood to
require the City to provide notice to perform its customary inspection, pursuant to its police power,
of all permitted work on the Project Property.
304. Compliance With Laws.
304.1 Prevailing Wage and Other Labor Standards. The Developer represents and
warrants that during the term of this Agreement that it will comply with all applicable State
prevailing wage requirements. The City retains the right to require the Developer and Project to
obtain a "Public Works Coverage Determination" from the California Department of Industrial
Relations prior to the commencement of any demolition, construction, or other "work," as used in
Labor Code Section 1720, et seq., at the Property or on the Project.
304.2 The Developer shall carry out the design of the Project and construction of
the Project in conformity with all applicable laws, including all applicable state labor standards,
the City zoning and development standards, building, plumbing, mechanical, and electrical codes,
and all other provisions of the Title 24 of the California Code of Regulations, and all applicable
disabled and handicapped access requirements, including without limitation the Americans With
Disabilities Act, 42 U.S.C. Section 12101, et seq., Government Code Section 4450, et seq.,
Government Code Section 11135, et seq., and the Unruh Civil Rights Act, Civil Code Section 51,
et seq. The Developer hereby agrees to carry out the development, construction, and operation of
the Project and Project Property, including, without limitation, any and all public works (as defined
by applicable law), in conformity with all applicable local, state, and federal laws, including,
without limitation, all applicable federal and state labor laws, including, without limitation, any
requirement to pay State prevailing wages. The Developer shall have the obligation to provide
any and all disclosures, representations, statements, rebidding, and/or identifications, which may
be required by Labor Code Sections 1726 and 1781, as the same may be enacted, adopted or
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amended from time to time, or any other provision of law. The Developer shall have the obligation
to provide and maintain any and all bonds to secure the payment of contractors (including the
payment of wages to workers performing any public work) which may be required by the Civil
Code, Labor Code Section 1781, as the same may be enacted, adopted or amended from time to
time, or any other provision of law. The Developer shall have the obligation, at Developer's sole
cost, risk and expense, to obligate any party as may be required by Labor Code Sections 1726 and
1781, as the same may be enacted, adopted or amended from time to time, or any other provision
of law. The Developer shall indemnify, protect, defend and hold harmless the City and its
respective officers, employees, contractors and agents, with counsel reasonably acceptable to the
City, from and against any and all loss, liability, damage, claim, cost, expense, and/or "increased
costs" (including labor costs, penalties, reasonable attorneys' fees, court and litigation costs, and
fees of expert witnesses) which, in connection with the completion of construction of the Project,
including, without limitation, any and all public works (as defined by applicable law), results or
arises in any way from any of the following: (i) the noncompliance by the Developer of any
applicable local, state and/or federal law, including, without limitation, any applicable federal
and/or state labor laws (including, without limitation, if applicable, the requirement to pay state
prevailing wages); (ii) the implementation of Sections 1726 and 1781 of the Labor Code, as the
same maybe enacted, adopted or amended from time to time, or any other similar law; (iii) failure
by the Developer to provide any required disclosure, representation, statement, rebidding and/or
identification which may be required by Labor Code Sections 1726 and 1781, as the same may be
enacted, adopted or amended from time to time, or any other provision of law; (iv) failure by the
Developer to provide and maintain any and all bonds. to secure the payment of contractors
(including the payment of wages to workers performing any public work) which may be required
by the Civil Code, Labor Code Section 1781, as the same may be enacted, adopted or amended
from time to time, or any other provision of law; and/or (v) failure by the Developer to obligate
any party as may be required by Labor Code Sections 1726 and 1781, as the same may be enacted,
adopted or amended from time to time, or any other provision of law. It is agreed by the parties
that, in connection with the development, construction and operation of the Project Property,
including, without limitation, any public work (as defined by applicable law), the Developer shall
bear all risks of payment or non-payment of state prevailing wages and/or the implementation of
Labor Code Sections 1726 and 1781, as the same may be enacted, adopted or amended from time
to time, and/or any other provision of law. "Increased costs" as used in this Section shall have the
meaning ascribed to it in Labor Code Section 1781, as the same may be enacted, adopted or
amended from time to time. The foregoing indemnity shall survive termination of this Agreement.
304.3 Workforce Enhancement Initiative. The purpose of this Section, and its
subparts, is to set forth guidance so that all construction work relating to Project pursuant to this
Agreement may proceed continuously and without interruption, thereby assuring the timely and
cost-effective Completion of Construction, and to support the efforts of the City to strive to
implement a form of construction career training through mentorship and opportunities for targeted
workers and local apprenticeship and pre -apprentice programs to the extent there is workforce
interest and it is financially feasible for the Developer with respect to the Project.
(a) Management Rights. The Developer and its general contractor retain
the full and exclusive authority for the management of its operations. The contractor shall
direct the workforce at its sole prerogative, including but not limited to the hiring,
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promotion, transfer, layoff, discipline, or discharge for just cause of its employees; the
selection of foremen and general foremen; the assignment and schedule of work; the
promulgation of reasonable work rules; and, the requirement of overtime work, the
determination of when it will be worked, and the number and identity of employees
engaged in such work.
(b) Apprentices. The parties recognize the need to maintain continuing
support of the programs designed to develop adequate numbers of competent workers in
the construction industry, the obligation to capitalize on the availability of the local
workforce, and the opportunities to provide continuing work under the construction
program. To these ends, the parties will use good faith efforts to facilitate, encourage, and
assist an established apprenticeship program to commence and progress in
labor/management apprenticeship and/or training programs during the course of
construction on the Project.
(c) Local Hires. The Developer will cause its general contractor to
ensure that individuals and fines located in or owned in substantial part by persons residing
in the area of the City of National City are used whenever possible, so long as the individual
or firm is qualified to perform such work, and is competitive in price. Such efforts (to the
extent feasible and permitted by law) shall include, but shall not be limited to: (i) including
such firms, when qualified, on solicitation mailing lists; (ii) encouraging their participation
through direct solicitation of proposals whenever they are a potential source; (iii) dividing
total subcontract requirements, when economically feasible, into smaller tasks or quantities
to permit maximum participation by such firms; and (iv) establishing delivery schedules,
where the requirement permits, which encourages participation by such firms.
(d) General Contractor. This Section shall apply and be limited to the
construction work relating to the Project to be performed by the general contractor selected
and engaged by the Developer. A copy of this Section shall be provided to the general
contractor to set forth guidance in hiring and other related labor practices.
304.4 Exclusions. Items specifically excluded from the scope of Section 304.2,
including its subparts, are as follows:
(a) the work of non -manual employees, including, but not limited to,
superintendents, supervisors, staff engineers, timekeepers, mail carriers, clerks, office
workers, messengers, guards, safety personnel, emergency medical and first aid
technicians, and other professional, engineering, consultants, administrative, supervisory,
executive and management employees; state inspectors or other public employees, post -
construction tenant improvements, emergency work, non -construction support services,
creation and installation of artwork, future maintenance, and architectural, engineering,
surveying or inspection services;
work;
(b) off -site maintenance of leased equipment and on -site supervision of such
In
(c) off -site laboratory work for testing;
(d) work performed by employees of an Original Equipment Manufacturer
("OEM") or vendor on the OEM's or vendor's equipment, if required by the warranty
agreement between the OEM or vendor and the Primary Employer or Developer in order
to maintain the warranty or guarantee on such equipment, and provided that the warranty
agreement is the OEM's or vendor's standard warranty agreement for such equipment and
is consistent with industry practice;
(e) all work related to the delivery, unloading, moving and installation of the
Developer's individual, unattached pieces of furniture, furnishings, equipment or supplies;
(f) all hauling from and delivery to the Project and deliveries of all materials
required to complete the Project, except the hauling/delivery of soil, sand, gravel,
aggregate, rocks, concrete, asphalt, excavation materials, fill material, and construction
debris; and
(g) the delivery, placement, servicing, and removal of all temporary toilets, site
fencing, storage units, temporary offices, and trash/recycling dumpsters, or any other
equipment or materials needed for the operation of the construction oversight.
305.Nondiscrimination in Employment. Developer certifies and agrees that all persons
employed or applying for employment by it, its affiliates, subsidiaries, or holding companies, and
all subcontractors, bidders, and vendors, are and will be treated equally by it without regard to, or
because of race, color, religion, ancestry, national origin, sex, gender identity, age, pregnancy,
childbirth or related medical condition, medical condition (cancer -related) or physical or mental
disability, and in compliance with Title VII of the Civil Rights Act of 1964, 42 U.S.C. Section
2000, et seq., the Federal Equal Pay Act of 1963, 29 U.S.C. Section 206(d), the Age Discrimination
in Employment Act of 1967, 29 U.S.C. Section 621, et seq., the Immigration Reform and Control
Act of 1986, 8 U.S.C. Section 1324b, et seq., 42 U.S.C. Section 1981, the California Fair
Employment and Housing Act, Cal. Government Code Section 12900, et seq., the California Equal
Pay Law, Cal. Labor Code Section 1197.5, Cal. Government Code Section 11135, the Americans
with Disabilities Act, 42 U.S.C. Section 12101, et seq., and all other anti -discrimination laws and
regulations of the United States and the State of California as they now exist or may hereafter be
amended. Developer shall allow representatives of the City access to its employment records
related to this Agreement during regular business hours and upon twenty-four (24) hours written
notice to Developer to verify compliance with these provisions when so requested by the City.
306. Taxes and Assessments. After Closing, the Developer shall pay, prior to
delinquency all ad valorem real estate taxes and assessments on the Project Property. Developer
shall remove or have removed any levy or attachment made after the Closing on the Project
Property, or any part thereof, or assure the satisfaction thereof within a reasonable time.
307.Liens and Stop Notices. Developer shall not allow any lien or stop notice to be
placed on the Project Property. If a claim of a lien or stop notice is given or recorded affecting the
M
Project Property, the Developer shall upon the earlier of: thirty (30) calendar days of such recorded
lien or stop notice or within fifteen (15) calendar days of the City's demand as to such matter:
(a) pay and discharge the same;
(b) effect the release thereof by recording and delivering to the City a surety
bond in sufficient form and amount as approved by the City in its sole discretion; or
(c) provide the City with other assurance which the City deems, in its sole
discretion, to be satisfactory for the payment of such lien or bonded stop notice and for the
full and continuous protection of the City from the effect of such lien or bonded stop notice.
308. Financing of the Project.
308.1 Encumbrances. With the exception of encumbrances arising from, or
relating to, state and/or federal agencies, prior to Completion of Construction, mortgages and deeds
of trust against the Project Property may be permitted only with the City's prior written approval,
which approval shall not unreasonably be withheld, denied, or conditioned, and only for the
purpose of securing loans of funds to be used for financing the Project Design and Plan work, and
any other purposes deemed necessary and appropriate by the City in connection with the Project.
The Developer shall notify the City in advance of the execution or recordation of any mortgage or
deed of trust. The Developer shall not enter into any mortgage or deed of trust for financing without
the prior written approval of the City, which approval the City agrees to give if any such mortgage
or deed of trust for financing is given to a responsible financing lending institution or person or
entity, as determined by the City in its reasonable discretion.
308.2 Right of City to Cure Mortgage or Deed of Trust Default. Prior to
Completion of Construction, in the event of a mortgage or deed of trust default or breach by the
Developer, the Developer shall immediately deliver to the City a copy of any mortgage holder's
notice of default. The City shall have the right but not the obligation to cure the default. In such
event, the City shall be entitled to reimbursement from the Developer of all costs and expenses
incurred by the City in curing such default, including without limitation attorneys' fees.
309.Occupancv Monitoring and Inspection Fees; Records and Reports. For a period of
fifty-five (55) years, commencing upon Completion of Construction, the Developer shall pay to
the City an annual occupancy monitoring fee per unit per year ("Annual Loan Monitoring Fee"),
as determined by schedules printed by the City and amended from time to time. For illustrative
purpose, the schedule containing the Annual Loan Monitoring Fee in effect at the time of this
Agreement's execution is attached hereto as Exhibit D. Annual Loan Monitoring Fees shall be
paid by the Developer to the City annually within thirty (30) calendar days after the City provides
a written invoice for the same. Developer shall supply the City, annually, on May 3l't, of each year
during the term of the Regulatory Agreement, for the immediately prior calendar year, such records
and reports relating to the Project Property as are required by the City to aid it in complying with
its reporting and record keeping requirements. The records and reports include the following
Project matters:
O
(a) Amount of funds expended pursuant to this Agreement;
(b) Eligible tenant information, including yearly income verifications;
(c) On -site inspection results;
(d) Housing payments charged to tenants;
(e) Affirmative marketing records;
(f) Insurance policies and notices;
(g) Equal Employment Opportunity and Fair Housing records;
(h) Labor costs and records;
(i) Audited income and expense statement, balance sheet, and statement of
cash flows for the Developer;
(j) Federal and State income tax returns for the calendar year, ending on the
preceding December 315;
(k) Annual budget of reserves for repair and replacement;
(1) Annual certification and representation regarding the status of all loans,
encumbrances, and taxes;
(m) Such other and further information and records as the City reasonably
requires in light of changes in law demanding such additional material from
the Developer.
310. Accessibility Standards. The Developer represents and warrants that it will comply
with all federal, state and local requirements and regulations concerning access to the units by the
disabled and handicapped persons.
400. Covenants and Restrictions.
400.1 Affordable Units. Developer covenants and agrees for itself, its successors,
assigns, and every successor in interest to the Project Property, or any part thereof, that upon
Completion of Construction and thereafter, Developer shall comply with the Regulatory
Agreement for the period of time specified therein. The Closing is conditioned upon the execution,
and recordation of the Regulatory Agreement against the Project Property.
400.2 Maintenance Covenants. Developer represents and warrants that after
Completion of Construction, the Project and all of the Affordable Units shall continually be
maintained in a decent, safe and sanitary condition, and in good repair as described in 24 C.F.R.
21
§5.703, and in a manner which satisfies the Uniform Physical Conditions Standards promulgated
by the Department of Housing and Urban Development (24 C.F.R. §5.705), as such standards are
interpreted and enforced by the City under its normal policies and procedures. The Developer
warrants that all construction work shall meet or exceed the applicable local codes and construction
standards, including zoning and building codes of the City as well as the provisions of the Model
Energy Code published by the Council of American Building Officials. The Developer hereby
consents to periodic inspection by the City' s designated inspectors and/or designees during regular
business hours and upon reasonable advance written notice of no less than 48 hours, including the
code enforcement agents of the City, to assure compliance with all applicable zoning, building
codes, regulations and property standards.
400.3 Nondiscrimination Covenants. The Developer covenants by and for itself
and any successors in interest that there shall be no discrimination against or segregation of, any
person or group of persons on the basis of race, color, creed, religion, sex, sexual orientation,
gender identity, marital status, national origin, ancestry, familial status, source of income or
disability of any person in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment
of the Project Property, nor shall any of them or any person claiming under or through it establish
or permit any such practice or practices of discrimination or segregation of any person or group of
persons on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government
Code, as 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, with reference to
the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or
vendees of the Project Property. The foregoing covenants shall run with the land. All such deeds,
leases, or contracts shall contain or be subject to substantially the following nondiscrimination or
nonsegregation clauses:
(a) Deeds. In deeds: "The grantee herein covenants by and for itself, its
successors and assigns, and all persons claiming under or through them, that there shall be
no discrimination against or segregation of any person or group of persons on account of
race, color, religion, sex, sexual orientation, disability, medical condition, familial status,
source of income, marital status, national origin or ancestry in the sale, lease, sublease,
transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the
grantee itself or any person claiming under or through it, establish or permit any such
practice or practices of discrimination or segregation with reference to the selection,
location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees
in the land herein conveyed. The foregoing covenants shall run with the land."
(b) Leases. In leases: "The lessee herein covenants by and for itself, its
successors and assigns, and all persons claiming under or through them, and this lease is
made and accepted upon and subject to the following conditions: That there shall be no
discrimination against or segregation of any person or group of persons, on account of race,
color, religion, sex, sexual orientation, gender identity disability, medical condition,
familial status, source of income, marital status, national origin or ancestry in the leasing,
subleasing, renting, transferring, use, occupancy, tenure or enjoyment of the land herein
leased, nor shall lessee itself, or any person claiming under or through it, establish or permit
such practice or practices of discrimination or segregation with reference to the selection,
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location, number, use or occupancy of tenants, lessees, sublessees, subtenants or vendees
in the land herein leased."
(c) Contracts. In contracts for the rental, lease or sale of the Project: "There
shall be no discrimination against or segregation of any person or group of persons on
account of race, color, religion, sex, sexual orientation, gender identity, disability, medical
condition, familial status, source of income, marital status, national origin or ancestry in
the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land, nor shall
the transferee itself or any person claiming under or through it, establish or permit any such
practice or practices of discrimination or segregation with reference to the selection,
location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees
of the land."
401.Obligation to Refrain from Discrimination.
401.1 State and Federal Requirements. Developer shall, at all times during the
term of this Agreement, comply with all of the affirmative marketing procedures adopted by the
City, unless otherwise prohibited by law. The Developer shall maintain records to verify
compliance with the applicable affirmative marketing procedures and compliance. Such records
are subject to inspection by the City during regular business hours upon five (5) calendar days'
written notice.
401.2 Additional Requirements. The Developer hereby agrees to comply with the
Title VII of the Civil Rights Act of 1964, as amended, the California Fair Employment Practices
Act, and any other applicable Federal and State laws and regulations.
401.3 Fair Housing Laws. All activities carried out by the Developer and/or its
agents shall be in accordance with the requirements of the Federal Fair Housing Act. The Fair
Housing Amendments Act of 1988 became effective on March 12, 1989. The Fair Housing
Amendments Act of 1988 and Title VIII of the Civil Rights Act of 1968, taken together, constitute
the Fair Housing Act. The Fair Housing Act provides protection against the following
discriminatory housing practices if they are based on race, sex, gender identity, religion, color,
handicap, familial status, or national origin: denying or refusing to rent housing, denying or
refusing to sell housing, treating differently applicants for housing, treating residents differently
in connection with terms and conditions, advertising a discriminatory housing preference or
limitation, providing false information about the availability of housing, harassing, coercing or
intimidating people from enjoying or exercising their rights under the Fair Housing Act,
blockbusting for profit, persuading owner to sell or rent housing by telling them that people of a
particular race, religion, etc. are moving into the neighborhood, imposing different terms for loans
for purchasing, constructing, improving, repairing, or maintaining a home, or loans secured by
housing; denying use or participation in real estate services, e.g., brokers' organizations, multiple
listing services, etc. The Fair Housing Act gives HUD the authority to hold administrative hearings
unless one of the parties elects to have the case heard in U.S. District Court and to issue subpoenas.
Both civil and criminal penalties are provided. The Fair Housing Act also provides protection for
people with disabilities and proscribes those conditions under which senior citizen housing is
exempt from the prohibitions based on familial status. The following State of California Laws also
23
govern housing discrimination and shall be complied with by Developer: Fair Employment and
Housing Act, Unruh Civil Rights Act of 1959, Ralph Civil Rights Act of 1976, and Civil Code
Section 54.1.
402.Effect of Violation of the Terms and Provisions of this Agreement. The City is
deemed the beneficiary of the terms and provisions of this Agreement and of the covenants running
with the land, for and in its own right and for the purposes of protecting the interests of the
community and other parties, public or private, in whose favor and for whose benefit this
Agreement and the covenants running with the land have been provided, without regard to whether
the City has been, remains or is an owner of any land or interest therein in the Project Property.
The City shall have the right, if this Agreement or its covenants are breached, to exercise all rights
and remedies, and to maintain any actions or suits at law or in equity or other proper proceedings
to enforce the curing of such breaches to which it or any other beneficiaries of this Agreement and
covenants may be entitled.
500. Defaults and Remedies.
500.1 Default Generally. Failure by the City or Developer to perform any action
or covenant required by this Agreement within the time periods provided herein following notice
and failure to cure as described hereafter, constitutes a "Default' under this Agreement. A party
claiming a Default shall give written notice of Default to the other party specifying the alleged
Default. Except as otherwise expressly provided in this Agreement, the claimant shall not institute
any proceeding against any other parry, and the other party shall not be in Default if: (i) such
alleged Default is cured thirty (30) calendar days from receipt of such written notice: or (ii) if the
alleged Default is such that it is not capable of being cured within thirty (30) calendar days, but
corrective action is initiated within thirty (30) calendar days and the allegedly defaulting party
diligently and in good faith works to effect a cure as soon as possible.
500.2 Institution of Legal Actions. In addition to any other rights or remedies and
subject to the restrictions otherwise set forth in this Agreement, any party may institute an action
at law or equity to seek specific performance of the terms of this Agreement, or to cure, correct or
remedy any Default, to recover damages for any Default, or to obtain any other remedy consistent
with the purpose of this Agreement. Such legal actions must be instituted in the County of San
Diego, State of California, downtown branch, or in the District of the United States District Court
in the County of San Diego.
501. Entry and Vesting of Title in City Prior to Completion of Construction.
501.1 Right of Reentry. In addition to all other rights and remedies the City may
have at law or in equity, the City has the right, at its election, to enter and take possession of the
City Property and all improvements thereon, and terminate and revest the fee interest in the City
Property in the City if after Closing, the Developer:
(a) fails to start construction of the Project as required by this
Agreement for a period of sixty (60) days after written notice thereof from the City; or
24
(b) abandons or substantially suspends construction of the Project
required by this Agreement for a period of sixty (60) days after written notice thereof from
City, subject to any extensions which may be agreed upon pursuant to Section 600.2 herein;
or
(c) transfers or suffers any involuntary transfer of the Project Property
or any part thereof in violation of, or contrary to, the provisions of this Agreement.
501.2 Limitations on Right of Entry. Such right to enter and vest shall be subject
to and be limited by and shall not defeat, render invalid or limit any mortgage or deed of trust
permitted by this Agreement that is senior to the Project Deed of Trust.
501.3 Termination of Right of Entry. The City's right to enter and take possession
of the City Property and all improvements thereon, and terminate and revest the same in the City,
shall terminate upon the timely Completion of Construction of the Project.
502. Rights and Remedies are Cumulative. Except as otherwise expressly stated in this
Agreement, the rights and remedies of the parties are cumulative, and the exercise by any party of
one or more of such rights or remedies shall not preclude the exercise by it, at the same or different
times, of any other rights or remedies for the same default or any other default by the other party.
503.Inaction Not a Waiver of Default. Any failures or delays by any party in asserting
any of its rights and remedies as to any Default shall not operate as a waiver of any Default or of
any such rights or remedies, or deprive either such parry 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 shall govern the interpretation and enforcement of this Agreement.
600. General Provisions.
600.1 Notices, Demands, and Communications Between the Parties. All notices
under this Agreement shall be in writing and sent (a) by certified or registered U.S. mail, return
receipt requested, (b) overnight by a nationally recognized overnight courier such as UPS
Overnight or FedEx, or (c) by personal delivery. All notices shall be effective upon receipt (or
refusal to accept delivery). All notices shall be delivered to the following addresses or such other
addresses as changed by any party from time to time by written notice to the other parties hereto.
To City: City of National City
1243 National City Boulevard
National City, CA 91950
Attention: Community Development Director
To Developer: Tower 999, LLC
4100 W Flamingo Rd, Suite 1416
Las Vegas, NV 89103
Attn: Cyrus Rapinan
25
With Copy To: Shift Capital
3400 J St Suite #G11,
Philadelphia, PA 19134
Attention: Gregg DiFabio
600.2 Enforced Delay: Extension of Times of Performance. In addition to specific
provisions of this Agreement, performance by any party hereunder shall not be deemed to be in
Default, and all performance and other dates specified in this Agreement shall be extended, where
delays or Defaults are due to: war; insurrection; strikes; lockouts; riots; floods; earthquakes; fires;
casualties; acts of God; acts of the public enemy; epidemics; pandemics; quarantine restrictions;
freight embargoes; lack of transportation; governmental restrictions or priority; litigation;
unusually severe weather; acts or omissions of the other party; or any other causes beyond the
control and without the fault of the party claiming an extension of time to perform.
Notwithstanding anything to the contrary in this Agreement, an extension of time for any such
cause shall be for the period of the delay and shall commence to run from the time of the
commencement of the cause, if notice by the party claiming such extension is sent to the other
party within ten (10) business days of the commencement of the cause. Times of performance
under this Agreement may also be extended in writing by the mutual agreement of the City
Manager and Developer.
601. Transfers of Interest in Property or Agreement.
601.1 Prohibition. The qualifications and identity of the Developer are of
particular concern to the City. It is because of those qualifications and identity that the City has
entered into this Agreement with the Developer. Until Completion of Construction, no voluntary
or involuntary successor in interest of the Developer shall acquire any rights or powers under this
Agreement, nor shall the Developer make any total or partial sale, transfer, conveyance,
assignment, subdivision, refinancing or lease of the whole or any part of the Project Property, or
the improvements thereon, without prior written approval of the City, which approval shall not be
unreasonably withheld, delayed, conditioned or denied. Any proposed total or partial sale, transfer,
conveyance, assignment, subdivision, refinancing, or lease of the whole or any part of the Project
Property or the improvements thereon will entitle the City to its right of reentry and revesting as
set forth in Section 501, and its subparts, hereof. For the reasons cited above, the Developer
represents and agrees for itself and any successor in interest to the Project Property that without
the prior written approval of the City, there shall be no significant change in the ownership of
the Developer or with respect to the identity of the parties in control of Developer or the degree
thereof, by any method or means. Developer shall promptly notify the City of any and all changes
whatsoever in the identity of the parties in control of the same or the degree thereof, of which it or
any of its officers have been notified or otherwise have knowledge or information. Any change
(voluntary or involuntary) in the composition, management, or control of the Developer shall be a
Default, except as otherwise permitted hereunder.
601.2 Permitted Transfers. Notwithstanding any other provision of this
Agreement to the contrary, the City approval of an assignment of this Agreement or conveyance
of the Project Property or the improvements thereon, or any part thereof, will be granted in
connection with any of the following, subject to the City and the applicable party executing
FM
appropriate documents of transfer which contain any exceptions or reservation of rights permitted
under this Agreement (each a "Permitted Transfer"):
(a) The conveyance or dedication of any portion of the Project Property
to the City or other governmental agency, or the granting of easements or permits to
facilitate completion of construction of the Project; or
(b) Any conveyance for financing purposes (provided such financing is
specifically allowed under this Agreement), including the Construction Deed of Trust and
Permanent Deed of Trust.
601.3 Assigmnent by the City. The City may assign or transfer this Agreement in
its entirety, or any of its rights or obligations hereunder.
601.4 Successors and Assigns. All of the terms, covenants, and conditions of this
Agreement shall be binding upon parties to the Agreement and their respective, permitted
successors and assigns.
602. Non -Liability of Officials and Employees
602.1 Citv. No member, official or employee of the City shall be personally liable
to Developer, or any successor in interest, in the event of any Default or breach of this Agreement
or for any amount which may become due to Developer or its successors, or on any obligations
under the terms of this Agreement.
602.2 Developer. No member, director, official, or employee of the Developer
shall be personally liable to the City, or any successor in interest, in the event of any Default or
breach of this Agreement or for any amount which may become due to the City or City or its
successors, or on any obligations under the terms of this Agreement.
603. Relationship Among the City and Developer. It is hereby acknowledged that the
relationship among the City and Developer is that of independent contractors and not that of a
partnership or joint venture and that the City and Developer shall not be deemed or construed for
any purpose to be the agent of the other. The Developer agrees to indemnify, hold harmless and
defend the City and Developer from any claim made against the City arising from a claimed
relationship of partnership or joint venture among the City and Developer.
604. City Approvals and Actions. Whenever a reference is made herein to an action or
approval to be undertaken by the City, the City Manager or designee is authorized to act on behalf
of the City unless specifically provided otherwise or the context should require otherwise.
605. Counterparts. This Agreement may be signed in multiple counterparts, which, when
signed by all parties, shall constitute a binding agreement.
606. Inte argr tion. This Agreement contains the entire understanding between the parties
relating to the subject matter of this Agreement. All prior or contemporaneous agreements,
27
understandings, representations, and statements, oral and written, are merged in this Agreement
and shall be of no further force or effect. Each party is entering this Agreement based' solely upon
the representations set forth herein and upon each party's own independent investigation of any
and all facts such party deems material. All exhibits referred to in this Agreement are hereby
incorporated in this Agreement by this reference, regardless of whether or not the exhibits are
actually attached to this Agreement. The Recitals to this Agreement are hereby incorporated in this
Agreement by this reference.
607.No Real Estate Brokerage Commissions. The City and Developer each represent
and warrant to the others that no broker or finder is entitled to any commission or finder's fee in
connection with the Project Property. The parties agree to defend and hold harmless the other party
from any claim to any such commission or fee from any broker, agent, or finder with respect to
this Agreement which is payable by such party.
608.Attomeys' Fees. The parties agree that the prevailing party in litigation for the
breach and/or interpretation and/or enforcement of the terms of this Agreement shall be entitled to
their expert witness fees, if any, as part of their costs of suit and reasonable attorneys' fees as may
be awarded by the court, pursuant to California Code of Civil Procedure ("CCP") Section 1033.5
and any other applicable provisions of California law, including, without limitation, the provisions
of CCP Section 998.
609. Titles and Captions. Titles and captions are for convenience of reference only and
do not define, describe, or limit the scope or the intent of this Agreement or of any of its terns.
References to section numbers are to sections in this Agreement, unless expressly stated otherwise.
610.Interpretation. As used in this Agreement, masculine, feminine, or neuter gender,
and the singular or plural number shall be deemed to include the others where and when the context
so dictates. The word "including" shall be construed as if followed by the words "without
limitation." This Agreement shall be interpreted as though prepared jointly by both parties.
611. No Waiver. A waiver by any party of a breach of any of the covenants, conditions,
or agreements under this Agreement to be performed by the other party shall not be construed as
a waiver of any succeeding breach of the same or other covenants, agreements, restrictions or
conditions of this Agreement.
612. Modifications. Any amendment, alteration, change or modification of or to this
Agreement, in order to become effective, shall be made in writing and in each instance signed on
behalf of each party (any amendment, alteration, change or modification of this Agreement on
behalf of the City, including without limitation changes to the economic terms of this Agreement
and its exhibits, shall be made on behalf of the City by the City Manager in the City Manager's
sole discretion).
613. Severability. If any term, provision, condition, or covenant of this Agreement or its
application to any party or circumstances shall be held, to any extent, invalid or unenforceable, the
remainder of this Agreement, or the application of the term, provision, condition or covenant to
m
persons or circumstances other than those as to whom or which it is held invalid or unenforceable,
shall not be affected, and shall be valid and enforceable to the fullest extent permitted by law.
614. Computation of Time. The time in which any act is to be done under this Agreement
is computed by excluding the first day (such as the day escrow opens), and including the last day,
unless the last day is a holiday or Saturday or Sunday, and then that day is also excluded. The term
"holiday" shall mean all holidays as specified in Section 6700 and 6701 of the California
Government Code. If any act is to be done by a particular time during the day, that time shall be
Pacific Time Zone time.
615. Legal Advice. Each party represents and warrants to the other the following: they
have carefully read this Agreement, and in signing this Agreement, they do so with full knowledge
of any right which they may have; they have received independent legal advice from their
respective legal counsel as to the matters set forth in this Agreement, or have knowingly chosen
not to consult legal counsel as to the matters set forth in this Agreement; and, they have freely
signed this Agreement without any reliance upon any agreement, promise, statement or
representation by or on behalf of the other parties, or their respective agents, employees, or
attorneys, except as specifically set forth in this Agreement, and without duress or coercion,
whether economic or otherwise.
616.Time of Essence. Time is expressly made of the essence with respect to the
performance by the City and Developer of each and every obligation and condition of this
Agreement.
617. Cooperation. Each party agrees to cooperate in good faith with the other in this
transaction and, in that regard, to sign any and all documents which may be reasonably necessary,
helpful, or appropriate to carry out the purposes and intent of this Agreement including, but not
limited to, releases or additional agreements.
618. Conflicts of Interest. No member, official, or employee of the City shall have any
personal interest, direct or indirect, in this Agreement, nor shall any such member, official, or
employee participate in any decision relating to the Agreement which affects his personal interests
or the interests of any corporation, partnership or association in which he is directly or indirectly
interested.
619. Exhibits and Recitals Incorporated. All exhibits referred to in this Agreement are
hereby incorporated in this Agreement by this reference, regardless of whether or not the exhibits
are actually attached to this Agreement. The recitals to this Agreement are hereby incorporated in
this Agreement by this reference.
620. Applicable Law. The laws of the State of California shall govern the interpretation
and enforcement of this Agreement.
62 L Alterriative Dispute Resolution. Any controversy or dispute arising out of this
Agreement shall be settled or determined by direct negotiation, mediation or litigation in the
County of San Diego, California. In the event that either party reasonably determines that a dispute
29
exists, such party shall promptly notify the other in writing as to the general nature of the dispute
and as to dates and times that such parry's authorized representatives are available to discuss
settlement. Within ten (10) calendar days of said notice, or as soon as reasonably practicable for
both parties thereafter, the parties shall meet and negotiate in a good faith attempt to settle the
dispute. In the event that the parties are unable to settle the dispute within ten (10) calendar days
after such meeting, the parties shall select a mediator from the list of approved mediators
maintained by the Superior Court for San Diego County or such other mediator as the parties may
agree. The parties shall cooperate with such mediator to schedule a mediation at the earliest
feasible date and shall comply with any reasonable conditions imposed on such mediation by the
mediator. The mediator's fee shall be divided equally between the parties. In the event that the
parties fail to resolve the dispute through mediation within thirty (30) calendar days after it is
submitted to the mediator, either party may file suit in the Superior Court of the State of California,
San Diego County for resolution of the dispute.
622. Authority to Sign. All individuals signing this Agreement for a party which is a
corporation, limited liability company, partnership, or other legal entity, or signing under a power
of attorney, or as a trustee, guardian, conservator, or in any other legal capacity, covenant to the
City that they have the necessary capacity and authority to act for, sign and bind the respective
entity or principal on whose behalf they are signing.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the date first written above.
CITY:
City of National City
By:
Benjamin A. Martinez, Cit} Manager
APPROVED AS TO FORM:
By: wH y 1, C
Barry J. Scl Itz ity Attorney
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
30
DEVELOPER:
Tower 999, LLC, a Nevada limited liability company
By:
Print Name:
Its:
By:
Print Name:
Its:
31
DEVELOPER:
Tower 999, LLC, a Nevada limited liability company
By:
Print Name:
Its:
31
M14aMid"
CITY PROPERTY LEGAL DESCRIPTION
32
LEGAL DESCRIPTION
The land referred to herein is situated in the State of California, County of San Diego and
described as follows:
Lots 4, 5 and 6 in Block One (1) of W.C. KIMBALL'S SUBDIVISION OF TEN ACRE LOT TWO (2) in
Quarter Section One Hundred Fifty Four (154) of Rancho De La Nacion, in the City of National City,
County of San Diego, State of California, according to Map thereof No. 105, filed in the Office of the
County Recorder of San Diego County, March 10, 1887.
APN: 556-471-03-00
(End of Legal Description)
LEGAL DESCRIPTION
The land referred to herein is situated in the State of California, County of San Diego and
described as follows:
Lot 7 in Block 1 of W.C. KIMBALL'S SUBDIVISION, in the City of National City, County of San Diego,
State of California of 10 acre lot 2 in Quarter Section 154 of Rancho De La Nacion, according to map
thereof No. 105, filed in the Office of the County Recorder of San Diego County, March 10, 1887.
APN: 556-471-04
(End of Legal Description)
DEVELOPER PROPERTY LEGAL DESCRIPTION
33
LEGAL DESCRIPTION
THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF NATIONAL CITY, IN THE COUNTY
OF SAN DIEGO, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS:
LOTS 8,9 AND 10 IN BLOCK I OF W. C. KIMBALL'S SUBDIVISION OF 10 ACRE LOT 2, QUARTER SECTION 154
OF RANCHO DE LA NACION, ACCORDING TO MAP THEREOF NO. 105 FILED IN THE OFFICE OF THE
COUNTY RECORDER OF SAN DIEGO COUNTY, MARCH 10, 1887.
APN: 556-471-17
CLTA Preliminary Report Form — Modified (11/17/06) Page 3
EXHIBIT C
INITIAL PROJECT BUDGET
912
EXHIBIT C
INITIAL PROJECT BUDGET
921-999 National City BLVD
Property Acquisition - Tower 999
$
1,250,000.00
City Parcel
$
50.000.00
Commission Fee
$
15.000.00
Total Acquisition
S
1,315,000.00
HARD COSTS
Hard Costs
$290 $
34 765,258.00
Additional Contingency
8% $
2,781,220.64
Insurance (CGL & COC)
2% $
695.305.16
Total Hard Costs
S
38,241,783.80
(COSTS
suhantFees
$ 1,118,500.00
d, Accounting, & LLC Costs
S 50,000.00
ronmental & Asbestos Reports
S 15 000.00
nits
$ 392,000.00
Estate Taxes (1 yr)
$ 12.500 00
lines (Reproductions)
$ 5,000.00
mbrig (Leaseup)
S 5,000.00
eisal
$ 10,000,00
rance. Utilities, Maintenance,
S 25.000.00
SubTotal Sck Casts
$ 1,633.000ki)
Cost Contingency
10%
$ 163,300.00
Total Soft Costs
f 1,796,300.00
erves
ie-up Reserve
$ 200,000.00
1NCING FEES
Onginabon Fee
too
$ 15,000.00
Application Fee
0.10'1.
$ 1,500.00
Legal Fee
S 10.000.00
ier Origination Fee
1 %
$ 253,962.63
est During Construction
5-00%
$ 952.359.86
rl Fee
$ 20,000.00
Cost
0 051<
S 12 69813
ing Costs
$ 10 000,00
Total Financing Fees
$ 1,275,520.63
ELOPER'S FEE
5%
$ 2.254.13U8
TOTAL DEVELOPMENT COSTS $ 45.082741.50
WLI: N O-C
Current Annual Loan Monitoring Fee Schedule
35
EXHIBIT D
MONITORING REQUIREMENTS AND ANNUAL FEE
City Fee Schedule effective December 4, 2023
Description
I Fee
Annual Monitoring
Fee Per Unit
1 $215.00
Section 309. Occupancy Monitoring and Inspection Fees; Records and Reports.
For a period of fifty-five (55) years, commencing upon Completion of Construction, the Developer
shall pay to the City an annual occupancy monitoring fee per unit per year ("Annual Loan
Monitoring Fee"), as determined by schedules printed by City and amended from time to time.
For illustrative purpose, the schedule containing the Annual Loan Monitoring Fee in effect at the
time of this Agreement's execution is attached hereto as Exhibit D. Annual Loan Monitoring Fees
shall be paid by Developer to the City annually within thirty (30) calendar days after the City
provides a written invoice for the same. Developer shall supply City, annually, on May 31', of
each year during the term of the Regulatory Agreement, for the immediately prior calendar year,
such records and reports relating to the Project Property as are required by the City to aid it in
complying with its reporting and record keeping requirements. The records and reports include the
following Project matters:
(a) Amount of funds expended pursuant to this Agreement;
(b) Eligible tenant information, including yearly income verifications;
(c) On -site inspection results;
(d) Housing payments charged to tenants;
(e) Affirmative marketing records;
(f) Insurance policies and notices;
(g) Equal Employment Opportunity and Fair Housing records;
(h) Labor costs and records;
(i) Audited income and expense statement, balance sheet and statement of cash
flows for the Developer;
(j) Federal and State income tax returns for the calendar year, ending on the
preceding December 315;
(k) Annual budget of reserves for repair and replacement;
(1) Annual certification and representation regarding status of all loans,
encumbrances and taxes;
(m) Such other and further information and records as the City reasonably
requires in light of changes in law demanding such additional material from
the Developer.