Loading...
HomeMy WebLinkAbout2015 CON SA Community Housing Works - Affordable Housing Project WITOD Phase 2GRANT AGREEMENT AND ESCROW INSTRUCTIONS [Transit -Oriented Infill Affordable Housing and Paradise Creek Enhancement Project] THIS GRANT AGREEMENT AND ESCROW INSTRUCTIONS, dated as of August 18, 2015 for identification purposes only (the "Grant Agreement"), is made and entered into by and between the SUCCESSOR AGENCY TO THE COMMUNITY DEVELOPMENT COMMISSION AS THE NATIONAL CITY REDEVELOPMENT AGENCY (the "Successor Agency"), and COMMUNITY HOUSINGWORKS, a California nonprofit public benefit corporation ("CHW"), with reference to the following: RECITALS A. WHEREAS, CHW is a California nonprofit public benefit corporation whose purposes include development and operation of such affordable housing in, among other areas, the County of San Diego; B. WHEREAS, the Community Development Commission of the City of National City ("CDC") and Paradise Creek Housing Partners, L.P., a California limited partnership (the "Phase I Developer"), entered into that certain "Disposition and Development Agreement," dated as of June 21, 2011 (the "DDA"); C. WHEREAS, the Redevelopment Agency of the City of National City ("Agency") was established by Ordinance No. 1164, dated April 11, 1967. The City formed the CDC and the Housing Authority of the City of National City ("Housing Authority") by Ordinance No. 1484, dated October 14, 1975. The CDC was established to enable both the Agency and the Housing Authority to operate under a single board and single entity. The CDC was responsible for the administration of redevelopment activities within the City of National City; D. WHEREAS, On February 1, 2012, California redevelopment agencies were dissolved, successor agencies were established as successor agencies to the former redevelopment agencies pursuant to Health and Safety Code Section 34173, and successor agencies were tasked with, among other things, paying, and performing and enforcing the enforceable obligations of the former redevelopment agencies. The City elected to serve as the successor agency to the CDC upon the dissolution of the Redevelopment Agency, pursuant to Resolution No. 2012-15 on January 10, 2012. The Successor Agency is a distinct and separate legal entity from the City, and is named "Successor Agency to the Community Development Commission as the National City Redevelopment Agency" ("Successor Agency"); E. WHEREAS, pursuant to the DDA and as more particularly provided therein, Phase I Developer will construct, in two (2) Phases, the Scope of Development on the Site (the "Project"), including, without limitation, a total of two hundred one (201) affordable rental housing units, certain community facilities for the use of the residents of both Phase I and Phase II, and certain offsite improvements including, without limitation, (i) improvement of the Paradise Creek Parcel, and (b) improvement and expansion, for the benefit of the entire community, of Paradise Creek Educational Park; F. WHEREAS, the obligations of Phase I Developer with respect to the development of Phase II have been assigned to Paradise Creek II Housing Partners, L.P., a California limited partnership ("Developer"), pursuant to that certain Assignment and Assumption Agreement by and between Phase I Developer and Developer dated as of ,40 2015; Paradise Creek TOD Phase II Grant Agreement Final G. WHEREAS, Successor Agency holds, within its Capital Improvements Fund, the sum of Fourteen Million Nine Hundred Nine Thousand Dollars ($14,909,000) to be used to finance development of affordable housing projects such as the Project (the "Funds"); H. WHEREAS, the Funds are proceeds of that certain "$39,660,000 Community Development Commission of the City of National City (San Diego County, California) (National City Redevelopment Project) 2011 Tax Allocation Bonds" (the "Bonds"); WHEREAS, Successor Agency desires also to foster the development of private nonprofit, community -based, service organizations with the capacity to develop and/or finance affordable housing projects in National City such as the Project; and J. WHEREAS, accordingly, Successor Agency, on the terms and conditions set forth in this Grant Agreement, intends to grant the sum of Fourteen Million Nine Hundred Nine Thousand Dollars ($14,909,000) to CHW for the purpose of permitting CHW to provide part of the financing for Phase II of the Project. NOW, THEREFORE, for and in consideration of the mutual promises, covenants, and conditions herein contained, Successor Agency and CHW agree as follows: 1. DEFINITIONS AND INTERPRETATION 1.1 Defined Terms. Capitalized words and terms used in this Grant Agreement and not defined in this Grant Agreement (including, without limitation, in the Recitals above) shall have the meanings ascribed thereto in the DDA. Other capitalized words and terms used in this Grant Agreement shall have the meanings ascribed thereto where first used or as set forth in this Section 1.1. Capitalized terms used in an exhibit attached hereto and not defined therein shall also have the meanings set forth in this Section 1.1. "CHW Loan Note" means the promissory note to be made by Developer to evidence the CHW Loan. "DDA" shall mean that certain Disposition and Development Agreement, dated as of June 21, 2011, by and between CDC and Developer, as such document may be amended and implemented by the parties thereto and as assigned, with respect to Phase II, by Phase Developer to Developer. "Grant for Phase II" has the meaning set forth in Section 5.1 of this Grant Agreement. 1.2 Singular and Plural Terms. Any defined term used in the plural in this Grant Agreement shall refer to all members of the relevant class and any defined term used in the singular shall refer to any number of the members of the relevant class. 1.3 Accounting Principles. Any accounting term used and not specifically defined in this Grant Agreement shall be construed in conformity with, and all financial data required to be submitted under this Grant Agreement shall be prepared in conformity with, generally accepted accounting principles applied on a consistent basis or in accordance with such other principles or methods as are reasonably acceptable to Successor Agency. 2 Paradise Creek TOD Phase II Grant Agreement Final 1.4 References and Other Terms. References herein to Articles, Sections and Exhibits shall be construed as references to this Grant Agreement unless a different document is named. References to subparagraphs shall be construed as references to the same Section in which the reference appears. The terms "including" and "include" mean "including (include) without limitation". 1.5 Exhibits Incorporated. All attachments to this Grant Agreement, as now existing and as the same may from time to time be modified, are incorporated herein by this reference. 2. PARTIES 2.1 Successor Agency. Successor Agency is the Successor Agency of the CDC and any successor to its rights, powers and responsibilities. The principal offices of Successor Agency are located at 1243 National City Boulevard, National City, California 91950. 2.2 CHW. CHW is Community HousingWorks, a California nonprofit, public benefit corporation. The principal offices of CHW are located at 2815 Camino del Rio South, Suite 350, Suite 550, San Diego, California, 92108. 3. INTENTIONALLY OMITTED 4. SUCCESSOR AGENCY RIGHT TO TERMINATE If the DDA terminates prior to the Close of Escrow for Phase II, then Successor Agency, in addition to any and all other rights it may have to terminate this Grant Agreement, shall have the right to terminate this Grant Agreement by notice to CHW. 5. GRANT 5.1 Amount and Purpose. Subject to the terms and conditions of this Grant Agreement, Successor Agency agrees to make a grant to CHW for Phase II (the "Grant for Phase II") in the amount of Fourteen Million Nine Hundred Nine Thousand Dollars ($14,909,000) to be used for the sole purpose of CHW making the CHW Loan for Phase II to Developer. Uses of the proceeds of the CHW Loan by Developer shall be limited to costs of construction of capital improvements with a projected useful life of at least 30 years, including, without limitation, predevelopment and other soft costs directly associated with such capital improvements, as permitted pursuant to the documents governing the Bonds (collectively, "Permissible Uses"). Notwithstanding anything herein to the contrary, the Successor Agency hereby acknowledges and agrees that the costs listed on the Budget for Grant Agreement attached hereto as Exhibit A constitute Permissible Uses hereunder. The CHW Loan Agreement (as defined below) shall obligate Developer, in its capacity as Borrower, to use the proceeds of the CHW Loan only for Permissible Uses as defined herein. 5.2 Conditions to Initial Disbursement of Grant for Phase II. Successor Agency's obligation to make and disburse Nine Million Two Hundred Thirty Two Thousand Three Hundred Seventy Five Dollars ($9,232,375)) of the Grant for Phase II (the "Initial Disbursement") shall be subject to satisfaction of the following conditions precedent: (a) Loan Agreement. CHW, as lender, and Developer, as borrower, enter into a loan agreement, approved by the Executive Director (including, without limitation, all 3 Paradise Creek TOD Phase II Grant Agreement Final underlying loan documents), pursuant to which CHW uses the Grant for Phase II proceeds for the purpose of making the CHW Loan to Developer on terms and conditions consistent with the DDA (the "CHW Loan Agreement"). At the time of the Initial Disbursement, until the Close of Escrow for Phase II, the CHW Loan shall be secured exclusively by the Work Product (as defined in CHW Loan Agreement), and neither CHW nor the Successor Agency shall have any additional security with respect to the CHW Loan other than the Work Product. Among other things, the CHW Loan Agreement shall provide that: (1) neither it, nor any of its accompanying documents (including, without limitation, the promissory note evidencing and/or the deed of trust that will, following the Close of Escrow for Phase II, secure the CHW Loan) may be amended, modified or rescinded without the prior written approval of the Executive Director, which approval shall not be unreasonably withheld, and the Successor Agency shall be named a third - party beneficiary of the same and (2) proceeds of the CHW Loan shall be used only for Permissible Uses. (b) No Default. No default by CHW under this Grant Agreement shall then exist, and no event shall then exist which, with the giving of notice or the passage of time or both, would constitute such a default by CHW and, if requested by the Executive Director, Successor Agency shall have received a certificate to that effect signed by CHW. 5.3 Conditions to Final Disbursement of Grant for Phase II. The remaining Five Million Six Hundred Seventy Six Thousand Six Hundred Twenty Five Dollars ($5,676,625) of the Grant for Phase II (the "Final Disbursement") shall be disbursed concurrently with the execution and delivery of this Grant Agreement, to an escrow account held by Old Republic Title Company ("Escrow Agent") pursuant to escrow instructions which are mutually acceptable to the Successor Agency and CHW. The Escrow Agent shall disburse upon satisfaction of the following conditions precedent: (a) Close of Escrow for Phase II. Escrow for Phase II must close concurrently. (b) Loan Agreement and Deed of Trust. The CHW Loan Agreement shall be in full force and effect and no default shall exist thereunder. CHW and Developer shall cause to be recorded a second priority deed of trust securing Developer's obligation to repay CHW Loan in the Official Records. (c) Disbursement Agreement. CHW, the Phase II Construction Lender and Successor Agency have entered into an agreement for disbursement of the Construction Amount of the Grant for Phase II substantially similar to the Construction Lender/Successor Agency Disbursement Agreement for Phase II and such agreement has been approved by Developer and the Tax Credit Partner for Phase II. (d) Insurance. Successor Agency has received satisfactory evidence that the insurance required pursuant to the Ground Lease for Phase II is in full force and effect. (e) Representations and Warranties. The representations of CHW contained in this Grant Agreement shall be correct in all material respects as of the Close of Escrow for Phase II as though made on and as of that date and, if requested by the Executive Director, Successor Agency shall have received a certificate to that effect signed by CHW. (f) No Default. No default by CHW under this Grant Agreement shall then exist, and no event shall then exist which, with the giving of notice or the passage of time 4 Paradise Creek TOD Phase II Grant Agreement Final or both, would constitute such a default by CHW and, if requested by the Executive Director, Successor Agency shall have received a certificate to that effect signed by CHW. (g) Use of Proceeds. Successor Agency has received a certification from the Developer certifying that (i) that the proceeds of the CHW Loan spent by Developer to date have been used only for Permissible Uses and (ii) unspent proceeds of the CHW Loan and proceeds of the Final Disbursement will be used only for Permissible Uses. 5.4 Disbursement of Grant for Phase II. The Initial Disbursement of the Grant for Phase II shall, subject to the terms and conditions of this Grant Agreement, be delivered directly to CHW and shall be disbursed therefrom on or about the date hereof to pay predevelopment expenses and certain site improvements in accordance with the Final Project Budget for Phase II. Successor Agency acknowledges and agrees that, should Close of the Phase II Escrow and/or the completion of Phase II of the Project not occur, Successor Agency, as fee owner of the Site, will have nonetheless received a benefit based on the predevelopment work and site improvements funded by the Initial Disbursement. The Final Disbursement of the Grant for Phase II shall, subject to the terms and conditions of this Grant Agreement, be deposited into the Phase II Escrow in time to permit the close thereof and shall be disbursed therefrom at Close of the Phase II Escrow (a) to pay closing costs and expenses shown on the closing statement for the Phase II Escrow, and (b) to the Construction Lender for Phase II for deposit into a construction account from which disbursements shall be made periodically by the Construction Lender only to pay Phase II Project Costs in accordance with the Final Project Budget for Phase II. 5.5 Return of Grant for Phase II. Notwithstanding anything herein to the contrary, if construction of Phase II of the Project has not commenced on or before December 31, 2018 (as the same may be extended with the consent of the Executive Director), to the extent any portion of the Grant for Phase II has (a) not yet been disbursed to Developer or (b) disbursed to Developer and repaid pursuant to the terms of the CHW Loan Agreement, such undisbursed or repaid funds shall be returned from CHW to the Successor Agency. 5.6 DOF and Oversight Board Approval. The parties hereto acknowledge and agree that this Grant Agreement is subject to review and approval by the Oversight Board to the Successor Agency and the California Department of Finance and that, notwithstanding anything herein to the contrary, the Grant Agreement shall not be deemed effective until the Successor Agency has obtained such approval from the Oversight Board to the Successor Agency and the California Department of Finance. Therefore, the Successor Agency and CHW acknowledge and agree that, upon receipt of such approvals, the Grant for Phase II is an unconditional and irrevocable obligation of the Successor Agency and cannot be recalled by the Successor Agency due to any claim or demand from any governmental agency having jurisdiction over the Site, including, without limitation, the California Department of Finance, pursuant to its authority under Section 34179.6(h)(1)(B) of the California Health and Safety Code, or any holder of the Bonds (a "Demand for Grant Recovery"). Without limiting the generality of the foregoing, (i) the Successor Agency hereby agrees to indemnify, defend, protect and hold harmless CHW, its officers, directors, partners, members, affiliates, employees, agents, successors and assigns from and against any loss, cost, damage, cause of action, suit, penalty, fine, liability or expense, including, without limitation, attorney's fees, costs of suit or court costs incurred as a result of a Demand for Grant Recovery which is proximately caused by any material misrepresentation, gross negligence or fraud by the Successor Agency, whether or not such Demand for Grant Recovery is successful; and (ii) CHW hereby agrees to indemnify, defend, protect and hold harmless the Successor Agency, its officers, directors, partners, 5 Paradise Creek TOD Phase II Grant Agreement Final members, affiliates, employees, agents, successors and assigns from and against any loss, cost, damage, cause of action, suit, penalty, fine, liability or expense, including, without limitation, attorneys' fees, costs of suit or court costs incurred as a result of a Demand for Grant Recovery which is proximately caused by any material misrepresentation, gross negligence or fraud by CHW, whether or not such Demand for Grant Recovery is successful. 6. PROGRAM INCOME 6.1 Defined. For the purposes of this Grant Agreement, "Program Income" shall mean all funds collected by CHW in repayment of the CHW Loan. 6.2 Use of Program Income. CHW shall use the Program Income to fund social and educational programming and activities for the benefit of the Project, its residents and the residents of the community of which the Project is a part (the "Paradise Creek -Related Programs and Activities"). Such programs and activities could include, without limitation: (a) resident and/or community -based cleanup efforts in and around the Project, including, without limitation, in and around the Paradise Creek Parcel and/or Paradise Creek Education Park; provided, however, such efforts may not include routine and/or regular maintenance of such property; (b) youth environmental education programming; (c) job corps -type training programs; (d) as matching funds for individual development accounts to assist people of modest means save for the purchase of a lifelong asset, such as a home; or to obtain education and/or job training; and education and coaching programs related to personal finance and credit management; (e) to make first-time homebuyer down payment loans and related homebuyer education and coaching programs; and/or (f) other activities as approved in advance by the Executive Director. 6.3 Submission of Annual Plan. Not later than thirty (30) days after first receipt by CHW of Program Income and every year thereafter for which CHW receives any Program Income, CHW shall submit to the Executive Director for approval (which approval shall not be unreasonably withheld) a plan and budget for the Paradise Creek -Related Programs and Activities that CHW proposes to fund and operate over the ensuing one (1)-year period (the "Annual Plan"). That notwithstanding, the Executive Director shall be under no obligation to allow use of the Program Income to fund programs and activities otherwise obligated to be provided by the Tenant under the Ground Lease for Phase II. Additionally, if the Program Income received by CHW for any year or succession of years is insufficient to fund and operate any meaningful Paradise Creek -Related Programs and Activities for the ensuing year, CHW may, with the written consent of the Executive Director (which consent shall not be unreasonably withheld) accumulate funds until sufficient by holding such funds (unless de minimis) in an interest -bearing account, with such interest to become Program Income. 6 Paradise Creek TOD Phase II Grant Agreement Final 6.4 Implementation of Annual Plan. Promptly after approval of any Annual Plan, CHW shall implement that Annual Plan. 6.5 Acknowledgment of City. Any and all Paradise Creek -Related Programs and Activates printed and/or digital materials, including signage, shall acknowledge, in a manner reasonably satisfactory to the Executive Director, the contribution of the City of National City to the funding of the subject program and/or activity. 6.6 Enforcement of CHW Loan Note. In order to reasonably maximize Program Income, CHW shall reasonably enforce payment of the CHW Loan Note. 7. GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS 7.1 CHW's Formation, Qualification and Compliance. CHW (a) is validly existing and in good standing under the laws of the State of California, (b) has all requisite authority to conduct its business, and has all requisite authority to execute and perform its obligations under this Grant Agreement. 7.2 Litigation. CHW represents and warrants that there are no material actions, lawsuits or proceedings pending or, to the best of CHW's knowledge, threatened against or affecting CHW, the adverse outcome of which could have a material adverse effect on CHW's ability to perform its obligations under this Grant Agreement. 8. RETENTION OF RECORDS CHW shall maintain all books, documents, papers, accounting records, and other evidence pertaining to this Grant Agreement and shall make such materials available at its office at all reasonable times during the term of this Grant Agreement and for three (3) years from the date of Close of Escrow for Phase II for inspection by Successor Agency and for furnishing of copies to Successor Agency, if requested. 9. INDEPENDENT CONTRACTOR Both parties hereto in the performance of this Grant Agreement will be acting in an independent capacity and not as agents, employees, partners or joint venturers with one another. Neither CHW nor CHW's employees are employees of Successor Agency and are not entitled to any of the rights, benefits, or privileges of Successor Agency's employees, including but not limited to retirement, medical, unemployment, or workers' compensation insurance. 10. CONTROL Neither Successor Agency nor its officers, agents or employees shall have any control over the conduct of CHW or any of CHW's employees except as herein set forth, and CHW expressly agrees not to represent that CHW or CHW's agents, servants, or employees are in any manner agents, servants or employees of Successor Agency, it being understood that CHW, its agents, servants, and employees are as to Successor Agency wholly independent contractors and that CHW's obligations to Successor Agency are solely such as are prescribed by this Grant Agreement. 7 Paradise Creek TOD Phase II Grant Agreement Final 11. COMPLIANCE WITH APPLICABLE LAW CHW, in the performance of this Grant Agreement, shall comply with all applicable State and Federal statutes and regulations, and all applicable ordinances of the City of National City, whether now in force or subsequently enacted. CHW, and each of its subcontractors, shall obtain and maintain a current City of National City business license prior to and during performance of any work pursuant to this Grant Agreement. 12. NON-DISCRIMINATION PROVISIONS In the performance of this Agreement, CHW shall: (a) not discriminate against any employee or applicant for employment because of age, race, color, ancestry, religion, sex, sexual orientation, marital status, national origin, physical handicap, or medical condition; and (b) take positive action to insure that applicants are employed without regard to their age, race, color, ancestry, religion, sex, sexual orientation, marital status, national origin, physical handicap, or medical condition. Such action shall include but not be limited to the following: employment, upgrading, demotion; transfer, recruitment or recruitment advertising, layoff or termination, rates of pay or other forms of compensation, and selection for training, including apprenticeship. 13. INDEMNIFICATION AND HOLD HARMLESS CHW agrees to defend, indemnify, and hold harmless Successor Agency and the City of National City, and their officers and employees, against and from any and all liability, loss, damages to property, injuries to, or death of any person or persons, and all claims, demands, suits, actions, proceedings, reasonable attorneys' fees, and• defense costs, of any kind or nature, including workers' compensation claims, of or by anyone whomsoever, resulting from or arising out of CHW's negligent performance of this Grant Agreement. 14. INSURANCE CHW shall cause the Developer to purchase and maintain, and to require its contractors, if any, to purchase and maintain, until issuance of the Certificate of Completion for Phase II, the following insurance policies: A. Automobile insurance covering all bodily injury and property damage incurred during the performance of this Grant Agreement, with a minimum coverage of $1,000,000 combined single limit per accident. Such automobile insurance shall include owned, non -owned, and hired vehicles ("any auto"). B. Commercial general liability insurance, with minimum limits of $2,000,000 per occurrence $4,000,000 aggregate, covering all bodily injury and property damage arising out of its operations under this Grant Agreement. C. Workers' compensation insurance in an amount sufficient to meet statutory requirements covering all of CHW employees and employers' liability insurance with limits of at least $1,000,000 per accident. In addition, the policy shall be endorsed with a waiver of subrogation in favor of Successor Agency. Said endorsement shall be provided prior to commencement of work under this Grant Agreement. 8 Paradise Creek TOD Phase II Grant Agreement Final D. The aforesaid policies shall constitute primary insurance as to Successor Agency, its officers, employees, and volunteers, so that any other policies held by Successor Agency shall not contribute to any loss under said insurance. Said policies shall provide for thirty (30) days prior written notice to Successor Agency of cancellation or material change. E. Said policies, except for the professional liability and workers' compensation policies, shall name Successor Agency, CDC and the City of National City, and their officers, agents and employees as additional insureds, and separate additional insured endorsements shall be provided. F. If required insurance coverage is provided on a "claims made" rather than "occurrence" form, CHW shall cause Developer to maintain such insurance coverage for three years after expiration of the term (and any extensions) of this Grant Agreement. In addition, the "retro" date must be on or before the date of this Grant Agreement. G. Any aggregate insurance limits must apply solely to this Grant Agreement. H. Insurance shall be written with only California admitted companies which hold a current policy holder's alphabetic and financial size category rating of not less than A VIII according to the current Best's Key Rating Guide, or a company equal financial stability that is approved by Successor Agency's Risk Manager. In the event coverage is provided by non -admitted "surplus lines" carriers, they must be included on the most recent California List of Eligible Surplus Lines Insurers (LESLI list) and otherwise meet rating requirements. I. This Grant Agreement shall not take effect until certificate(s) or other sufficient proof that these insurance provisions have been complied with, are filed with and approved by Successor Agency's Risk Manager. If CHW does not cause Developer to keep all of such insurance policies in full force and effect at all times required under this Grant Agreement, Successor Agency may elect to treat the failure to maintain the requisite insurance as a breach of this Grant Agreement and, subject to the right to notice and cure set forth in Section 17.A, terminate this Grant Agreement as provided herein. J. All deductibles and self -insured retentions in excess of $10,000 must be disclosed to and approved by Successor Agency. 15. LEGAL FEES If any party brings a suit or action against the other party arising from any breach of any of the covenants or agreements or any inaccuracies in any of the representations and warranties on the part of the other party arising out of this Grant Agreement, then in that event, the prevailing party in such action or dispute, whether by final judgment or out -of -court settlement, shall be entitled to have and recover of and from the other party all reasonable costs and expenses of suit, including reasonable attorneys' fees. For purposes of determining who is to be considered the prevailing party, it is stipulated that attorney's fees incurred in the prosecution or defense of the action or suit shall not be considered in determining the amount of the judgment or award. 9 Paradise Creek TOD Phase II Grant Agreement Final 16. MEDIATION/ARBITRATION If a dispute arises out of or relates to this Grant Agreement, or the breach thereof, the parties agree first to try, in good faith, to settle the dispute by mediation in San Diego, California, in accordance with the Commercial Mediation Rules of the American Arbitration Association (the "AAA") before resorting to arbitration. The costs of mediation shall be borne equally by the parties. Any controversy or claim arising out of, or relating to, this Grant Agreement, or breach thereof, which is not resolved by mediation shall be settled by arbitration in San Diego, California, in accordance with the Commercial Arbitration Rules of the AAA then existing. Any award rendered shall be final and conclusive upon the parties, and a judgment thereon may be entered in any court having jurisdiction over the subject matter of the controversy. The expenses of the arbitration shall be borne equally by the parties to the arbitration, provided that each party shall pay for and bear the costs of its own experts, evidence and attorneys' fees, except that the arbitrator may assess such expenses or any part thereof against a specified party as part of the arbitration award. 17. TERMINATION A. This Grant Agreement may be terminated by Successor Agency for cause in the event of a material breach of this Grant Agreement and failure by CHW to cure such breach within thirty (30) days after the giving of notice by Successor Agency. If, however, by its nature the failure cannot reasonably be cured within thirty (30) days, CHW may have such longer period of time as is reasonably necessary to cure the failure, provided, however, that CHW commence said cure within said thirty (30)-day period, and thereafter diligently prosecute said cure to completion within one hundred eighty (180) days. B. Termination with cause shall be effected by delivery of written Notice of Termination to CHW as provided for herein. C. Upon termination of this Grant Agreement pursuant to the terms hereof, Successor Agency shall have no obligation to disburse any outstanding portions of the Grant for Phase II. 18. NOTICES All notices or other communications required or permitted hereunder shall be in writing, and shall be personally delivered; or sent by overnight mail (Federal Express or the like); or sent by registered or certified mail, postage prepaid, return receipt requested; or sent by ordinary mail, postage prepaid; or telegraphed or cabled; or delivered or sent by telex, telecopy, facsimile or fax; and shall be deemed received upon the earlier of (i) if personally delivered, the date of delivery to the address of the person to receive such notice, (ii) if sent by overnight mail, the business day following its deposit in such overnight mail facility, (iii) if mailed by registered, certified or ordinary mail, five (5) days (ten (10) days if the address is outside the State of California) after the date of deposit in a post office, mailbox, mail chute, or other like facility regularly maintained by the United States Postal Service, (iv) if given by telegraph or cable, when delivered to the telegraph company with charges prepaid, or (v) if given by telex, telecopy, facsimile or fax, when sent. Any notice, request, demand, direction or other communication delivered or sent as specified above shall be directed to the following persons: To the Successor Agency: Successor Agency to the Community Development Commission as the National City Redevelopment 10 Paradise Creek TOD Phase II Grant Agreement Final To CHW: Agency 1243 National City Blvd. National City, California 91950 Attn: Executive Director Community HousingWorks 2815 Camino del Rio South, Suite 350 San Diego, California 92108 Attn: Anne B. Wilson, Sr. VP of Housing & Real Estate Development Notice of change of address shall be given by written notice in the manner specified in this Section. Rejection or other refusal to accept or the inability to deliver because of changed address of which no notice was given shall be deemed to constitute receipt of the notice, demand, request or communication sent. Any notice, request, demand, direction or other communication sent by cable, telex, telecopy, facsimile or fax must be confirmed within forty-eight (48) hours by letter mailed or delivered as specified in this Section. 19. DEPARTMENT OF FINANCE APPROVAL The parties hereto acknowledge and agree that this Grant Agreement is subject to review and approval by the Oversight Board to the Successor Agency and the California Department of Finance and that, notwithstanding anything herein to the contrary, the Grant Agreement shall not be deemed effective until the Successor Agency has obtained such approval from the Oversight Board to the Successor Agency and the California Department of Finance. 20. MISCELLANEOUS PROVISIONS A. Computation of Time Periods. If any date or time period provided for in this Grant Agreement is or ends on a Saturday, Sunday or federal, state or legal holiday, then such date shall automatically be extended until 5:00 p.m. Pacific Time of the next day which is not a Saturday, Sunday or federal, state or legal holiday. B. Counterparts. This Grant Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which, together, shall constitute but one and the same instrument. C. Captions. Any captions to, or headings of, the sections or subsections of this Grant Agreement are solely for the convenience of the parties hereto, are not a part of this Grant Agreement, and shall not be used for the interpretation or determination of the validity of this Grant Agreement or any provision hereof D. No Obligations to Third Parties. Except as otherwise expressly provided herein, the execution and delivery of this Grant Agreement shall not be deemed to confer any rights upon, or obligate any of the parties hereto, to any person or entity other than the parties hereto. E. Exhibits and Schedules. The Exhibits and Schedules attached hereto are hereby incorporated herein by this reference for all purposes. 11 Paradise Creek TOD Phase II Grant Agreement Final F. Amendment to this Grant Agreement. The terms of this Grant Agreement may not be modified or amended except by an instrument in writing executed by each of the parties hereto. G. Waiver. The waiver or failure to enforce any provision of this Grant Agreement shall not operate as a waiver of any future breach of any such provision or any other provision hereof. H. Applicable Law. This Grant Agreement shall be governed by and construed in accordance with the laws of the State of California. Entire Agreement. This Grant Agreement supersedes any prior agreements, negotiations and communications, oral or written, and contains the entire agreement between the parties as to the subject matter hereof. No subsequent agreement, representation, or promise made by either party hereto, or by or to an employee, officer, agent or representative of any party hereto shall be of any effect unless it is in writing and executed by the party to be bound thereby. J. Successors and Assigns. This Grant Agreement shall be binding upon and shall inure to the benefit of the successors and assigns of the parties hereto. K. Construction. The parties acknowledge and agree that (i) each party is of equal bargaining strength, (ii) each party has actively participated in the drafting, preparation and negotiation of this Grant Agreement, (iii) each such party has consulted with or has had the opportunity to consult with its own, independent counsel and such other professional advisors as such party has deemed appropriate, relative to any and all matters contemplated under this Grant Agreement, (iv) each party and such party's counsel and advisors have reviewed this Grant Agreement, (v) each party has agreed to enter into this Grant Agreement following such review and the rendering of such advice, and (vi) any rule or construction to the effect that ambiguities are to be resolved against the drafting party shall not apply in the interpretation of this Grant Agreement, or any portions hereof, or any amendments hereto. (signatures on following page) 12 Paradise Creek TOD Phase II Grant Agreement Final IN WITNESS WHEREOF, the parties hereto have executed this Grant Agreement on the date and year first above written. APPROVED AS TO FORM: Christensen & Spath LLP, Successor Agency Special Counsel By: COMMUNITY HOU nonprofit, publi Bv• N ts: GWORKS, a California Corp• ation / SUCCESSOR AGENCY TO THE COMMUNITY DEVELOPMENT COMMISSION AS THE NATIONAL CITY REDEVELOPMENT AGENCY By: ame: Ron Morrison Its: Chairman S-1 Paradise Creek TOD Phase II Grant Agreement Final EXHIBIT A Budget for Grant Agreement 1 Park Remediation 2 Park Improvements 3 GC Site Preparation including Site Remediation 4 Total Predevelopment Scope of Work i Grand Total Predevelo • ment Sco • e of Work (Detail) Architecture Landscape Architecture $3,000,000 $1,800,000 $2,289,284 $2,143, 091 $9,232,375 $433,185 $90,000 3 Civil Engineering $250,000 4 Environmental Engineering 5 Geotechnical Engineering 6 Title 24/MEP Peer Review 7 Utility Consultant 8 Sustainability .................. g Other Architects & Engineers $72,000 10 Blueprinting / Printing / Copying 11 Appraisals & Market Studies 12 Interior Design Coordinator 13 Zoning Approvals 14 TCAC Application Fee 15 TCAC Performance Deposit Grand Total $150,000 $55,000 $50,000 $20,000 $60,000 $11,500 $8,000 $8,000 $873,406 $2,000 $60,000 $2,143,091 Exhibit "A" Page 1 of 1 Paradise Creek TOD Phase II Grant Agreement Final RESOLUTION NO. 2015 — 70 RESOLUTION OF THE SUCCESSOR AGENCY TO THE COMMUNITY DEVELOPMENT COMMISSION AS THE NATIONAL CITY REDEVELOPMENT AGENCY APPROVING A GRANT AGREEMENT AND ESCROW INSTRUCTIONS BY AND BETWEEN THE SUCCESSOR AGENCY AND COMMUNITY HOUSINGWORKS, PROVIDING A GRANT OF $14,909,000 TO ASSIST DEVELOPMENT OF PHASE II OF AN INFILL AFFORDABLE HOUSING PROJECT, PUBLIC FACILITIES, OPEN SPACES, AND COMMUNITY SERVICES ON 12.75 ACRES FORMERLY KNOWN AS THE NATIONAL CITY PUBLIC WORKS CENTER AND ILLES FAMILY TRUST SITE WHEREAS, Community HousingWorks ("CHW") is a California nonprofit public benefit corporation whose purposes include development and operation of such affordable housing in, among other areas, the County of San Diego; and WHEREAS, the Community Development Commission of the City of National City ("CDC") and Paradise Creek Housing Partners, L.P., a California limited partnership (the "Phase I Developer"), entered into that certain "Disposition and Development Agreement," dated as of June 21, 2011 (the "DDA"), maintained as a public record by the City Clerk of the City of National City ("City"); and WHEREAS, the Redevelopment Agency of the City of National City ("Agency") was established by Ordinance No. 1164, dated April 11, 1967; and WHEREAS, the City formed the CDC and the Housing Authority of the City of National City ("Housing Authority") by Ordinance No. 1484, dated October 14, 1975; and WHEREAS, the CDC was established to enable both the Agency and the Housing Authority to operate under a single board and single entity, responsible for the administration of redevelopment activities within the City of National City; and WHEREAS, on February 1, 2012, the State of California dissolved all California redevelopment agencies, and established successor agencies to the former redevelopment agencies vested with all authority, rights, powers, duties and obligations of the dissolved redevelopment agencies pursuant to California Health and Safety Code Section 34173, said obligations including the payment, and performance and enforcement of enforceable obligations of the dissolved redevelopment agencies; and WHEREAS, the City elected to serve as the successor agency to the CDC in its capacity as the Agency, upon the Agency's dissolution, pursuant to Resolution No. 2012-15 on January 10, 2012, and in that capacity exists and functions as a distinct and separate legal entity named "Successor Agency to the Community Development Commission as the National City Redevelopment Agency" ("Successor Agency"); and WHEREAS, pursuant to the DDA and as more particularly provided therein, the Phase I Developer had the duty to construct, in two (2) Phases, an infill affordable housing project ("Project") on the 12.75 acres known as the former National City Public Works Center and Illes Family Trust site ("Site"); and WHEREAS, per the DDA, the Project would include, without limitation, a total of two hundred one (201) affordable rental housing units, certain community facilities for the use of the residents of both Phase I and Phase II, and certain offsite improvements including, without Resolution No. 2015 — 70 August 18, 2015 Page Two limitation, (a) improvement of the Paradise Creek Parcel, to wit, the Site, and (b) improvement and expansion, for the benefit of the entire community, of "Paradise Creek Educational Park"; and WHEREAS, the obligations of Phase I Developer with respect to the development of Phase II of the Project have been assigned to Paradise Creek II Housing Partners, L.P., a California limited partnership ("Developer"), and WHEREAS, the Successor Agency holds, within its Capital Improvements Fund, the sum of Fourteen Million Nine Hundred Nine Thousand Dollars ($14,909,000.00) to be used to finance development of affordable housing projects such as the Project (the "Funds"); and WHEREAS, the Funds are proceeds of the issuance of those certain "$39,660,000 Community Development Commission of the City of National City (San Diego County, California) (National City Redevelopment Project) 2011 Tax Allocation Bonds" ("Bonds"); and WHEREAS, in accord with its statutory function and operation, the Successor Agency desires also to foster the development of private nonprofit, community -based, service organizations with the capacity to develop and/or finance affordable housing projects in National City such as the Project; and WHEREAS, the Successor Agency, on the terms and conditions set forth in that certain "Grant Agreement and Escrow Instructions" approved by the Successor Agency on August 18, 2015 and maintained by the Clerk as a public record ("Grant Agreement"), granted the Funds, i.e., sum of Fourteen Million Nine Hundred Nine Thousand Dollars ($14,909,000.00), to CHW with the sole purpose that CHW make a loan to Developer for the capital improvements, and thereby finance Phase II's development; and WHEREAS, an anticipated by-product of the Successor Agency's loan to CHW and CHW's role in the Project will be CHW's enhanced capacity to participate in the development of future affordable housing projects in the community; and WHEREAS, pursuant to the Grant Agreement, CHW has pledged to use its income from Developer's re -payment to CHW of Funds derived from the Bonds for programs annually approved by the Executive Director including: 1. Resident and community -based clean-up efforts within the Project; 2. Youth environmental education programming; 3. Jobs -corps type training; 4. To create a matching fund for Project residents saving for home ownership; and 5. To create a first time homebuyer program for Project residents. Resolution No. 2015 — 70 August 18, 2015 Page Three WHEREAS, the Grant Agreement must be approved by both the Oversight Board of the Successor Agency to the Community Development Commission as the National City Redevelopment Agency ("Oversight Board") and the California Department of Finance prior to being effective; and NOW, THEREFORE, BE IT RESOLVED by the Successor Agency to the Community Development Commission as the National City Redevelopment Agency as follows: Section 1. The foregoing recitals are true and correct, and are a substantive part of this Resolution, including the terms defined therein. Section 2. The Successor Agency hereby approves the Grant Agreement, a true and correct copy of which is maintained by the City Clerk as a public record, whereby the Successor Agency and CHW agreed upon the terms and conditions under which the Successor Agency would (i) provide CHW Funds derived from the issuance of Bonds, to wit, a grant of $14,909,000.00, assisting in the development of the Project at the Site by permitting CHW to provide part of the financing for Phase II of the Project, and as a by-product of CHW fulfilling its duties under the Grant Agreement, (ii) enhance CHW's capacity to participate in the development of future affordable housing projects in the community. Section 3. The Chairman of the Successor Agency is hereby authorized and directed to take such other actions and execute such other documents as are necessary to effectuate the intent of this Resolution. Section 4. The Successor Agency has determined that (i) the certified Environmental Impact Report for the Westside Specific Plan ("EIR") analyzed a Transit Oriented Development for the Site, and that the Project's development will comply with the California Environmental Quality Act ("CEQA") and the guidelines adopted in relation thereto ("Guidelines"), and (ii) insofar as this Resolution and the approved Grant Agreement build CHW's capacity to participate in the development of future affordable housing projects in the community, this Resolution does not represent a "project" for purposes of CEQA, as that term is defined by Guidelines section 15378, because this Resolution is an organizational or administrative activity that will not result in a direct or indirect physical change in the environment, per section 15378(b)(5) of the Guidelines. Section 5. The City Clerk shall certify to the adoption of this Resolution. [Signature Page to Follow] Resolution No. 2015 — 70 August 18, 2015 Page Four PASSED and ADOPTED this 18th day of August, on orrison, Chairman ATTEST: Michael R. Dalla, City Clerk as Secretary to the Successor Agency Passed and adopted by the Successor Agency to the Community Development Commission as the Redevelopment Agency of the City of National City, California, on August 18, 2015 by the following vote, to -wit: Ayes: Boardmembers Cano, Mendivil, Morrison, Rios, Sotelo-Solis. Nays: None. Absent: None. Abstain: None. AUTHENTICATED BY: RON MORRISON Chairman of the Successor Agency to the Community Development Commission as the Redevelopment Agency of the City of National City, California City Clerk Serving as Secretary to the Successor Agency By: Deputy I HEREBY CERTIFY that the above and foregoing is a full, true and correct copy of RESOLUTION NO. 2015-70 of the Successor Agency to the Community Development Commission as the Redevelopment Agency of the City of National City, California, passed and adopted on August 18, 2015. City Clerk Serving as Secretary to the Successor Agency By: Deputy CITY OF NATIONAL CITY, CALIFORNIA 40c-,0_,?, SUCCESSOR AGENCY TO THE COMMUNITY DEVELOPMENT COMMISSION AS THE NATIONAL CITY REDEVELOPMENT AGENCY AGENDA STATEMENT AGENDA ITEM NO. 4 MEETING DATE: August 18, 2015 ITEM TITLE: Resolution of the Successor Agency to the Community Development Commission as the National City Redevelopment Agency approving a Grant Agreement and Escrow Instructions by and between the Successor Agency and Community HousingWorks providing a grant of $14,909,000 to assist development of Phase II of an infill affordable housing project, public facilities, open spaces and community services on 12.75 acres formerly known as the National City Public Works Center (2200 Hoover Avenue) and Illes Family Trust site (2020 Hoover Avenue). PREPARED BY: Carlos Aguirre, Community Dev. Prog. Mgr. DEPARTMENT: Housing, Grants, and Asset Mana•c me t PHONE: 619-336-4391 APPROV EXPLANATION: See Attachment No. 1 FINANCIAL STATEMENT: ACCOUNT NO. 715-409-000-650-9060 WI-TOD Phase II $14,909,000.00 This Agreement provides a grant of $14,909,000 from an allocation of 2011 Tax Allocation Bond proceeds. The funds would be directly placed in an escrow account for the project, rather than being deposited in the recipient's general business accounts. ENVIRONMENTAL REVIEW: The certified Environmental Impact Report for the Westside Specific Plan analyzed a Transit Oriented Development for this site. ORDINANCE: INTRODUCTION: FINAL ADOPTION: APPROVED: /I Finance STAFF RECOMMENDATION: Adopt the resolution. N/P BOARD / COMMISSION RECOMMENDATION: Adopt the Resolution ATTACHMENTS: 1. Explanation- Paradise Creek Housing Project Phase II Grant Agreement and Escrow Instructions 2. Grant Agreement and Escrow Instructions `ants,-9O Attachment No. 1 EXPLANATION: Paradise Creek Housing Project Phase II Grant Agreement and Escrow Instructions The Transit -Oriented Infill Affordable Housing and Paradise Creek Enhancement Project, also known as the Westside Infill Transit Oriented Development (WI-TOD) is a 201-unit affordable housing development on the east side of Paradise Creek, and the expansion of Paradise Creek Educational Park on the west side of the creek. The proposed Project is based on a concept that was developed through a neighborhood and stakeholder design participation process and incorporated into the Westside Specific Plan, which was adopted in 2010. The project design was developed with continuing public input and participation through stakeholder and community meetings. In March 2011, the Community Development Commission issued tax exempt bonds in part to assist with the development. The first phase of the development is currently being built on approximately four acres on the southern portion of the site and includes 109 units within two buildings and a separate residential services building. The second phase would be built on approximately two acres on the northern portion of the site and would include 92 units within two buildings. In order to complete financing for the construction of the second phase, the Successor Agency is assisting the second phase with $14,909,000 in bond proceeds from the 2011 tax exempt bonds. Since Paradise Creek 11 Housing Partners, LP, the developer for the second phase, is a for -profit entity, it is not eligible to receive the tax exempt bond funds directly without impacting the tax exempt status of the bonds. Community HousingWorks, a development partner in the project and a 501(c)3 non-profit, is eligible to receive the funds as a grant. Community HousingWorks would then lend the grant proceeds to the developer of the second phase to build the capital improvements. Income from loan repayment to Community HousingWorks would be used to fund programs approved by the Executive Director of the Successor Agency annually including resident and community -based clean-up efforts for the project, youth environmental education programming, jobs -corps type training, to create a matching program for resident savings accounts, and to create a first-time home buyer program for project residents. A continuance on this item was requested at the Successor Agency meeting on August 4, 2015 to agree on indemnifications provided in the Grant Agreement for Community HousingWorks, the Successor Agency, and Oversight Board. Attachment No. 2 GRANT AGREEMENT AND ESCROW INSTRUCTIONS [Transit -Oriented Infill Affordable Housing and Paradise Creek Enhancement Project] THIS GRANT AGREEMENT AND ESCROW INSTRUCTIONS, dated as of August , 2015 for identification purposes only (the "Grant Agreement"), is made and entered into by and between the SUCCESSOR AGENCY TO THE COMMUNITY DEVELOPMENT COMMISSION AS THE NATIONAL CITY REDEVELOPMENT AGENCY (the "Successor Agency"), and COMMUNITY HOUSINGWORKS, a California nonprofit public benefit corporation ("CHW"), with reference to the following: RECITALS A. WHEREAS, CHW is a California nonprofit public benefit corporation whose purposes include development and operation of such affordable housing in, among other areas, the County of San Diego; B. WHEREAS, the Community Development Commission of the City of National City ("CDC") and Paradise Creek Housing Partners, L.P., a California limited partnership (the "Phase I Developer"), entered into that certain "Disposition and Development Agreement," dated as of June 21, 2011 (the "DDA"); C. WHEREAS, the Redevelopment Agency of the City of National City ("Agency") was established by Ordinance No. 1164, dated April 11, 1967. The City formed the CDC and the Housing Authority of the City of National City ("Housing Authority") by Ordinance No. 1484, dated October 14, 1975. The CDC was established to enable both the Agency and the Housing Authority to operate under a single board and single entity. The CDC was responsible for the administration of redevelopment activities within the City of National City; D. WHEREAS, On February 1, 2012, California redevelopment agencies were dissolved, successor agencies were established as successor agencies to the former redevelopment agencies pursuant to Health and Safety Code Section 34173, and successor agencies were tasked with, among other things, paying, and performing and enforcing the enforceable obligations of the former redevelopment agencies. The City elected to serve as the successor agency to the CDC upon the dissolution of the Redevelopment Agency, pursuant to Resolution No. 2012-15 on January 10, 2012. The Successor Agency is a distinct and separate legal entity from the City, and is named "Successor Agency to the Community Development Commission as the National City Redevelopment Agency" ("Successor Agency"); E. WHEREAS, pursuant to the DDA and as more particularly provided therein, Phase I Developer will construct, in two (2) Phases, the Scope of Development on the Site (the "Project"), including, without limitation, a total of two hundred one (201) affordable rental housing units, certain community facilities for the use of the residents of both Phase I and Phase II, and certain offsite improvements including, without limitation, (i) improvement of the Paradise Creek Parcel, and (b) improvement and expansion, for the benefit of the entire community, of Paradise Creek Educational Park; F. WHEREAS, the obligations of Phase I Developer with respect to the development of Phase II have been assigned to Paradise Creek II Housing Partners, L.P., a California limited partnership ("Developer"), pursuant to that certain Assignment and Assumption Agreement by and between Phase I Developer and Developer dated as of , 2015; 50119225.4 Attachment No. 2 G. WHEREAS, Successor Agency holds, within its Capital Improvements Fund, the sum of Fourteen Million Nine Hundred Nine Thousand Dollars ($14,909,000) to be used to finance development of affordable housing projects such as the Project (the "Funds"); H. WHEREAS, the Funds are proceeds of that certain "$39,660,000 Community Development Commission of the City of National City (San Diego County, California) (National City Redevelopment Project) 2011 Tax Allocation Bonds" (the "Bonds"); WHEREAS, Successor Agency desires also to foster the development of private nonprofit, community -based, service organizations with the capacity to develop and/or finance affordable housing projects in National City such as the Project; and J. WHEREAS, accordingly, Successor Agency, on the terms and conditions set forth in this Grant Agreement, intends to grant the sum of Fourteen Million Nine Hundred Nine Thousand Dollars ($14,909,000) to CHW for the purpose of permitting CHW to provide part of the financing for Phase II of the Project. NOW, THEREFORE, for and in consideration of the mutual promises, covenants, and conditions herein contained, Successor Agency and CHW agree as follows: 1. DEFINITIONS AND INTERPRETATION 1.1 Defined Terms. Capitalized words and terms used in this Grant Agreement and not defined in this Grant Agreement (including, without limitation, in the Recitals above) shall have the meanings ascribed thereto in the DDA. Other capitalized words and terms used in this Grant Agreement shall have the meanings ascribed thereto where first used or as set forth in this Section 1.1. Capitalized terms used in an exhibit attached hereto and not defined therein shall also have the meanings set forth in this Section 1.1. "CHW Loan Note" means the promissory note to be made by Developer to evidence the CHW Loan. "DDA" shall mean that certain Disposition and Development Agreement, dated as of June 21, 2011, by and between CDC and Developer, as such document may be amended and implemented by the parties thereto and as assigned, with respect to Phase II, by Phase I Developer to Developer. "Grant for Phase II" has the meaning set forth in Section 5.1 of this Grant Agreement. 1.2 Singular and Plural Terms. Any defined term used in the plural in this Grant Agreement shall refer to all members of the relevant class and any defined term used in the singular shall refer to any number of the members of the relevant class. 1.3 Accounting Principles. Any accounting term used and not specifically defined in this Grant Agreement shall be construed in conformity with, and all financial data required to be submitted under this Grant Agreement shall be prepared in conformity with, generally accepted accounting principles applied on a consistent basis or in accordance with such other principles or methods as are reasonably acceptable to Successor Agency. 2 50119225.4 Attachment No. 2 1.4 References and Other Terms. References herein to Articles, Sections and Exhibits shall be construed as references to this Grant Agreement unless a different document is named. References to subparagraphs shall be construed as references to the same Section in which the reference appears. The terms "including" and "include" mean "including (include) without limitation". 1.5 Exhibits Incorporated. All attachments to this Grant Agreement, as now existing and as the same may from time to time be modified, are incorporated herein by this reference. 2. PARTIES 2.1 Successor Agency. Successor Agency is the Successor Agency of the CDC and any successor to its rights, powers and responsibilities. The principal offices of Successor Agency are located at 1243 National City Boulevard, National City, California 91950. 2.2 CHW. CHW is Community HousingWorks, a California nonprofit, public benefit corporation. The principal offices of CHW are located at 2815 Camino del Rio South, Suite 350, Suite 550, San Diego, California, 92108. 3. INTENTIONALLY OMITTED 4. SUCCESSOR AGENCY RIGHT TO TERMINATE If the DDA terminates prior to the Close of Escrow for Phase II, then Successor Agency, in addition to any and all other rights it may have to terminate this Grant Agreement, shall have the right to terminate this Grant Agreement by notice to CHW. 5. GRANT 5.1 Amount and Purpose. Subject to the terms and conditions of this Grant Agreement, Successor Agency agrees to make a grant to CHW for Phase II (the "Grant for Phase II") in the amount of Fourteen Million Nine Hundred Nine Thousand Dollars ($14,909,000) to be used for the sole purpose of CHW making the CHW Loan for Phase II to Developer. Uses of the proceeds of the CHW Loan by Developer shall be limited to costs of construction of capital improvements with a projected useful life of at least 30 years, including, without limitation, predevelopment and other soft costs directly associated with such capital improvements, as permitted pursuant to the documents governing the- Bonds (collectively, "Permissible Uses"). Notwithstanding anything herein to the contrary, the Successor Agency hereby acknowledges and agrees that the costs listed on the Budget for Grant Agreement attached hereto as Exhibit A constitute Permissible Uses hereunder. The CHW Loan Agreement (as defined below) shall obligate Developer, in its capacity as Borrower, to use the proceeds of the CHW Loan only for Permissible Uses as defined herein. 5.2 Conditions to Initial Disbursement of Grant for Phase II. Successor Agency's obligation to make and disburse Six Million Five Hundred Twenty Seven Thousand Three Hundred Dollars ($6,527,300) of the Grant for Phase II (the "Initial Disbursement") shall be subject to satisfaction of the following conditions precedent: (a) Loan Agreement. CHW, as lender, and Developer, as borrower, enter into a loan agreement, approved by the Executive Director (including, without limitation, all 3 50119225.4 Attachment No. 2 underlying loan documents), pursuant to which CHW uses the Grant for Phase II proceeds for the purpose of making the CHW Loan to Developer on terms and conditions consistent with the DDA (the "CHW Loan Agreement"). At the time of the Initial Disbursement, until the Close of Escrow for Phase II, the CHW Loan shall be secured exclusively by the Work Product (as defined in CHW Loan Agreement), and neither CHW nor the Successor Agency shall have any additional security with respect to the CHW Loan other than the Work Product. Among other things, the CHW Loan Agreement shall provide that: (1) neither it, nor any of its accompanying documents (including, without limitation, the promissory note evidencing and/or the deed of trust that will, following the Close of Escrow for Phase II, secure the CHW Loan) may be amended, modified or rescinded without the prior written approval of the Executive Director, which approval shall not be unreasonably withheld, and the Successor Agency shall be named a third - party beneficiary of the same and (2) proceeds of the CHW Loan shall be used only for Permissible Uses. (b) No Default. No default by CHW under this Grant Agreement shall then exist, and no event shall then exist which, with the giving of notice or the passage of time or both, would constitute such a default by CHW and, if requested by the Executive Director, Successor Agency shall have received a certificate to that effect signed by CHW. 5.3 Conditions to Final Disbursement of Grant for Phase II. The remaining Eight Million Three Hundred Eighty One Thousand Seven Hundred Dollars ($8,381,700) of the Grant for Phase II (the "Final Disbursement") shall be disbursed concurrently with the execution and delivery of this Grant Agreement, to an escrow account held by Old Republic Title Company ("Escrow Agent") pursuant to escrow instructions which are mutually acceptable to the Successor Agency and CHW. The Escrow Agent shall disburse upon satisfaction of the following conditions precedent: (a) Close of Escrow for Phase II. Escrow for Phase II must close concurrently. (b) Loan Agreement and Deed of Trust. The CHW Loan Agreement shall be in full force and effect and no default shall exist thereunder. CHW and Developer shall cause to be recorded a second priority deed of trust securing Developer's obligation to repay CHW Loan in the Official Records. (c) Disbursement Agreement. CHW, the Phase II Construction Lender and Successor Agency have entered into an agreement for disbursement of the Construction Amount of the Grant for Phase II substantially similar to the Construction Lender/Successor Agency Disbursement Agreement for Phase II and such agreement has been approved by Developer and the Tax Credit Partner for Phase II. (d) Insurance. Successor Agency has received satisfactory evidence that the insurance required pursuant to the Ground Lease for Phase II is in full force and effect. (e) Representations and Warranties. The representations of CHW contained in this Grant Agreement shall be correct in all material respects as of the Close of Escrow for Phase II as though made on and as of that date and, if requested by the Executive Director, Successor Agency shall have received a certificate to that effect signed by CHW. (f) No Default. No default by CHW under this Grant Agreement shall then exist, and no event shall then exist which, with the giving of notice or the passage of time 4 50119225.4 Attachment No. 2 or both, would constitute such a default by CHW and, if requested by the Executive Director, Successor Agency shall have received a certificate to that effect signed by CHW. (g) Use of Proceeds. Successor Agency has received a certification from the Developer certifying that (i) that the proceeds of the CHW Loan spent by Developer to date have been used only for Permissible Uses and (ii) unspent proceeds of the CHW Loan and proceeds of the Final Disbursement will be used only for Permissible Uses. 5.4 Disbursement of Grant for Phase II. The Initial Disbursement of the Grant for Phase II shall, subject to the terms and conditions of this Grant Agreement, be delivered directly to CHW and shall be disbursed therefrom on or about the date hereof to pay predevelopment expenses and certain site improvements in accordance with the Final Project Budget for Phase II. Successor Agency acknowledges and agrees that, should Close of the Phase II Escrow and/or the completion of Phase II of the Project not occur, Successor Agency, as fee owner of the Site, will have nonetheless received a benefit based on the predevelopment work and site improvements funded by the Initial Disbursement. The Final Disbursement of the Grant for Phase II shall, subject to the terms and conditions of this Grant Agreement, be deposited into the Phase II Escrow in time to permit the close thereof and shall be disbursed therefrom at Close of the Phase II Escrow (a) to pay closing costs and expenses shown on the closing statement for the Phase II Escrow, and (b) to the Construction Lender for Phase II for deposit into a construction account from which disbursements shall be made periodically by the Construction Lender only to pay Phase II Project Costs in accordance with the Final Project Budget for Phase II. 5.5 Return of Grant for Phase II. Notwithstanding anything herein to the contrary, if construction of Phase II of the Project has not commenced on or before December 31, 2018 (as the same may be extended with the consent of the Executive Director), to the extent any portion of the Grant for Phase II has (a) not yet been disbursed to Developer or (b) disbursed to Developer and repaid pursuant to the terms of the CHW Loan Agreement, such undisbursed or repaid funds shall be returned from CHW to the Successor Agency. 5.6 DOF and Oversight Board Approval. The parties hereto acknowledge and agree that this Grant Agreement is subject to review and approval by the Oversight Board to the Successor Agency and the California Department of Finance and that, notwithstanding anything herein to the contrary, the Grant Agreement shall not be deemed effective until the Successor Agency has obtained such approval from the Oversight Board to the Successor Agency and the California Department of Finance. Therefore, the Successor Agency and CHW acknowledge and agree that, upon receipt of such approvals, the Grant for Phase II is an unconditional and irrevocable obligation of the Successor Agency and cannot be recalled by the Successor Agency due to any claim or demand from any governmental agency having jurisdiction over the Site, including, without limitation, the California Department of Finance, pursuant to its authority under Section 34179.6(h)(1)(B) of the California Health and Safety Code, or any holder of the Bonds (a "Demand for Grant Recovery"). Without limiting the generality of the foregoing, (i) the Successor Agency hereby agrees to indemnify, defend, protect and hold harmless CHW, its officers, directors, partners, members, affiliates, employees, agents, successors and assigns from and against any loss, cost, damage, cause of action, suit, penalty, fine, liability or expense, including, without limitation, attorney's fees, costs of suit or court costs incurred as a result of a Demand for Grant Recovery which is proximately caused by any material misrepresentation, gross negligence or fraud by the Successor Agency, whether or not such Demand for Grant Recovery is successful; and (ii) CHW hereby agrees to indemnify, defend, protect and hold harmless the Successor Agency, its officers, directors, partners, 5 50119225.4 Attachment No. 2 members, affiliates, employees, agents, successors and assigns from and against any loss, cost, damage, cause of action, suit, penalty, fine, liability or expense, including, without limitation, attorneys' fees, costs of suit or court costs incurred as a result of a Demand for Grant Recovery which is proximately caused by any material misrepresentation, gross negligence or fraud by CHW, whether or not such Demand for Grant Recovery is successful. 6. PROGRAM INCOME 6.1 Defined. For the purposes of this Grant Agreement, "Program Income" shall mean all funds collected by CHW in repayment of the CHW Loan. 6.2 Use of Program Income. CHW shall use the Program Income to fund social and educational programming and activities for the benefit of the Project, its residents and the residents of the community of which the Project is a part (the "Paradise Creek -Related Programs and Activities"). Such programs and activities could include, without limitation: (a) resident and/or community -based cleanup efforts in and around the Project, including, without limitation, in and around the Paradise Creek Parcel and/or Paradise Creek Education Park; provided, however, such efforts may not include routine and/or regular maintenance of such property; (b) youth environmental education programming; (c) job corps -type training programs; (d) as matching funds for individual development accounts to assist people of modest means save for the purchase of a lifelong asset, such as a home; or to obtain education and/or job training; and education and coaching programs related to personal finance and credit management; (e) to make first-time homebuyer down payment loans and related homebuyer education and coaching programs; and/or (f) other activities as approved in advance by the Executive Director. 6.3 Submission of Annual Plan. Not later than thirty (30) days after first receipt by CHW of Program Income and every year thereafter for which CHW receives any Program Income, CHW shall submit to the Executive Director for approval (which approval shall not be unreasonably withheld) a plan and budget for the Paradise Creek -Related Programs and Activities that CHW proposes to fund and operate over the ensuing one (1)-year period (the "Annual Plan"). That notwithstanding, the Executive Director shall be under no obligation to allow use of the Program Income to fund programs and activities otherwise obligated to be provided by the Tenant under the Ground Lease for Phase II. Additionally, if the Program Income received by CHW for any year or succession of years is insufficient to fund and operate any meaningful Paradise Creek -Related Programs and Activities for the ensuing year, CHW may, with the written consent of the Executive Director (which consent shall not be unreasonably withheld) accumulate funds until sufficient by holding such funds (unless de minimis) in an interest -bearing account, with such interest to become Program Income. 6 50119225.4 Attachment No. 2 6.4 Implementation of Annual Plan. Promptly after approval of any Annual Plan, CHW shall implement that Annual Plan. 6.5 Acknowledgment of City. Any and all Paradise Creek -Related Programs and Activates printed and/or digital materials, including signage, shall acknowledge, in a manner reasonably satisfactory to the Executive Director, the contribution of the City of National City to the funding of the subject program and/or activity. 6.6 Enforcement of CHW Loan Note. In order to reasonably maximize Program Income, CHW shall reasonably enforce payment of the CHW Loan Note. 7. GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS 7.1 CHW's Formation, Qualification and Compliance. CHW (a) is validly existing and in good standing under the laws of the State of California, (b) has all requisite authority to conduct its business, and has all requisite authority to execute and perform its obligations under this Grant Agreement. 7.2 Litigation. CHW represents and warrants that there are no material actions, lawsuits or proceedings pending or, to the best of CHW's knowledge, threatened against or affecting CHW, the adverse outcome of which could have a material adverse effect on CHW's ability to perform its obligations under this Grant Agreement. 8. RETENTION OF RECORDS CHW shall maintain all books, documents, papers, accounting records, and other evidence pertaining to this Grant Agreement and shall make such materials available at its office at all reasonable times during the term of this Grant Agreement and for three (3) years from the date of Close of Escrow for Phase II for inspection by Successor Agency and for furnishing of copies to Successor Agency, if requested. 9. INDEPENDENT CONTRACTOR Both parties hereto in the performance of this Grant Agreement will be acting in an independent capacity and not as agents, employees, partners or joint venturers with one another. Neither CHW nor CHW's employees are employees of Successor Agency and are not entitled to any of the rights, benefits, or privileges of Successor Agency's employees, including but not limited to retirement, medical, unemployment, or workers' compensation insurance. 10. CONTROL Neither Successor Agency nor its officers, agents or employees shall have any control over the conduct of CHW or any of CHW's employees except as herein set forth, and CHW expressly agrees not to represent that CHW or CHW's agents, servants, or employees are in any manner agents, servants or employees of Successor Agency, it being understood that CHW, its agents, servants, and employees are as to Successor Agency wholly independent contractors and that CHW's obligations to Successor Agency are solely such as are prescribed by this Grant Agreement. 7 50119225.4 Attachment No. 2 11. COMPLIANCE WITH APPLICABLE LAW CHW, in the performance of this Grant Agreement, shall comply with all applicable State and Federal statutes and regulations, and all applicable ordinances of the City of National City, whether now in force or subsequently enacted. CHW, and each of its subcontractors, shall obtain and maintain a current City of National City business license prior to and during performance of any work pursuant to this Grant Agreement. 12. NON-DISCRIMINATION PROVISIONS In the performance of this Agreement, CHW shall: (a) not discriminate against any employee or applicant for employment because of age, race, color, ancestry, religion, sex, sexual orientation, marital status, national origin, physical handicap, or medical condition; and (b) take positive action to insure that applicants are employed without regard to their age, race, color, ancestry, religion, sex, sexual orientation, marital status, national origin, physical handicap, or medical condition. Such action shall include but not be limited to the following: employment, upgrading, demotion, transfer, recruitment or recruitment advertising, layoff or termination, rates of pay or other forms of compensation, and selection for training, including apprenticeship. 13. INDEMNIFICATION AND HOLD HARMLESS CHW agrees to defend, indemnify, and hold harmless Successor Agency and the City of National City, and their officers and employees, against and from any and all liability, loss, damages to property, injuries to, or death of any person or persons, and all claims, demands, suits, actions, proceedings, reasonable attorneys' fees, and• defense costs, of any kind or nature, including workers' compensation claims, of or by anyone whomsoever, resulting from or arising out of CHW's negligent performance of this Grant Agreement. 14. INSURANCE CHW shall cause the Developer to purchase and maintain, and to require its contractors, if any, to purchase and maintain, until issuance of the Certificate of Completion for Phase II, the following insurance policies: A. Automobile insurance covering all bodily injury and property damage incurred during the performance of this Grant Agreement, with a minimum coverage of $1,000,000 combined single limit per accident. Such automobile insurance shall include owned, non -owned, and hired vehicles ("any auto"). B. Commercial general liability insurance, with minimum limits of $2,000,000 per occurrence $4,000,000 aggregate, covering all bodily injury and property damage arising out of its operations under this Grant Agreement. C. Workers' compensation insurance in an amount sufficient to meet statutory requirements covering all of CHW employees and employers' liability insurance with limits of at least $1,000,000 per accident. In addition, the policy shall be endorsed with a waiver of subrogation in favor of Successor Agency. Said endorsement shall be provided prior to commencement of work under this Grant Agreement. 8 50119225.4 Attachment No. 2 D. The aforesaid policies shall constitute primary insurance as to Successor Agency, its officers, employees, and volunteers, so that any other policies held by Successor Agency shall not contribute to any loss under said insurance. Said policies shall provide for thirty (30) days prior written notice to Successor Agency of cancellation or material change. E. Said policies, except for the professional liability and workers' compensation policies, shall name Successor Agency, CDC and the City of National City, and their officers, agents and employees as additional insureds, and separate additional insured endorsements shall be provided. F. If required insurance coverage is provided on a "claims made" rather than "occurrence" form, CHW shall cause Developer to maintain such insurance coverage for three years after expiration of the term (and any extensions) of this Grant Agreement. In addition, the "retro" date must be on or before the date of this Grant Agreement. G. Any aggregate insurance limits must apply solely to this Grant Agreement. H. Insurance shall be written with only California admitted companies which hold a current policy holder's alphabetic and financial size category rating of not less than A VIII according to the current Best's Key Rating Guide, or a company equal financial stability that is approved by Successor Agency's Risk Manager. In the event coverage is provided by non -admitted "surplus lines" carriers, they must be included on the most recent California List of Eligible Surplus Lines Insurers (LESLI list) and otherwise meet rating requirements. This Grant Agreement shall not take effect until certificate(s) or other sufficient proof that these insurance provisions have been complied with, are filed with and approved by Successor Agency's Risk Manager. If CHW does not cause Developer to keep all of such insurance policies in full force and effect at all times required under this Grant Agreement, Successor Agency may elect to treat the failure to maintain the requisite insurance as a breach of this Grant Agreement and, subject to the right to notice and cure set forth in Section 17.A, terminate this Grant Agreement as provided herein. J. All deductibles and self -insured retentions in excess of $10,000 must be disclosed to and approved by Successor Agency. 15. LEGAL FEES If any party brings a suit or action against the other party arising from any breach of any of the covenants or agreements or any inaccuracies in any of the representations and warranties on the part of the other party arising out of this Grant Agreement, then in that event, the prevailing party in such action or dispute, whether by final judgment or out -of -court settlement, shall be entitled to have and recover of and from the other party all reasonable costs and expenses of suit, including reasonable attorneys' fees. For purposes of determining who is to be considered the prevailing party, it is stipulated that attorney's fees incurred in the prosecution or defense of the action or suit shall not be considered in determining the amount of the judgment or award. 9 50119225.4 Attachment No. 2 16. MEDIATION/ARBITRATION If a dispute arises out of or relates to this Grant Agreement, or the breach thereof, the parties agree first to try, in good faith, to settle the dispute by mediation in San Diego, California, in accordance with the Commercial Mediation Rules of the American Arbitration Association (the "AAA") before resorting to arbitration. The costs of mediation shall be borne equally by the parties. Any controversy or claim arising out of, or relating to, this Grant Agreement, or breach thereof, which is not resolved by mediation shall be settled by arbitration in San Diego, California, in accordance with the Commercial Arbitration Rules of the AAA then existing. Any award rendered shall be final and conclusive upon the parties, and a judgment thereon may be entered in any court having jurisdiction over the subject matter of the controversy. The expenses of the arbitration shall be borne equally by the parties to the arbitration, provided that each party shall pay for and bear the costs of its own experts, evidence and attorneys' fees, except that the arbitrator may assess such expenses or any part thereof against a specified party as part of the arbitration award. 17. TERMINATION A. This Grant Agreement may be terminated by Successor Agency for cause in the event of a material breach of this Grant Agreement and failure by CHW to cure such breach within thirty (30) days after the giving of notice by Successor Agency. If, however, by its nature the failure cannot reasonably be cured within thirty (30) days, CHW may have such longer period of time as is reasonably necessary to cure the failure, provided, however, that CHW commence said cure within said thirty (30)-day period, and thereafter diligently prosecute said cure to completion within one hundred eighty (180) days. B. Termination with cause shall be effected by delivery of written Notice of Termination to CHW as provided for herein. C. Upon termination of this Grant Agreement pursuant to the terms hereof, Successor Agency shall have no obligation to disburse any outstanding portions of the Grant for Phase II. 18. NOTICES All notices or other communications required or permitted hereunder shall be in writing, and shall be personally delivered; or sent by overnight mail (Federal Express or the like); or sent by registered or certified mail, postage prepaid, return receipt requested; or sent by ordinary mail, postage prepaid; or telegraphed or cabled; or delivered or sent by telex, telecopy, facsimile or fax; and shall be deemed received upon the earlier of (i) if personally delivered, the date of delivery to the address of the person to receive such notice, (ii) if sent by overnight mail, the business day following its deposit in such overnight mail facility, (iii) if mailed by registered, certified or ordinary mail, five (5) days (ten (10) days if the address is outside the State of California) after the date of deposit in a post office, mailbox, mail chute, or other like facility regularly maintained by the United States Postal Service, (iv) if given by telegraph or cable, when delivered to the telegraph company with charges prepaid, or (v) if given by telex, telecopy, facsimile or fax, when sent. Any notice, request, demand, direction or other communication delivered or sent as specified above shall be directed to the following persons: To the Successor Agency: Successor Agency to the Community Development Commission as the National City Redevelopment 10 50119225.4 Attachment No. 2 To CHW: Agency 1243 National City Blvd. National City, California 91950 Attn: Executive Director Community HousingWorks 2815 Camino del Rio South, Suite 350 San Diego, California 92108 Attn: Anne B. Wilson, Sr. VP of Housing & Real Estate Development Notice of change of address shall be given by written notice in the manner specified in this Section. Rejection or other refusal to accept or the inability to deliver because of changed address of which no notice was given shall be deemed to constitute receipt of the notice, demand, request or communication sent. Any notice, request, demand, direction or other communication sent by cable, telex, telecopy, facsimile or fax must be confirmed within forty-eight (48) hours by letter mailed or delivered as specified in this Section. 19. DEPARTMENT OF FINANCE APPROVAL The parties hereto acknowledge and agree that this Grant Agreement is subject to review and approval by the Oversight Board to the Successor Agency and the California Department of Finance and that, notwithstanding anything herein to the contrary, the Grant Agreement shall not be deemed effective until the Successor Agency has obtained such approval from the Oversight Board to the Successor Agency and the California Department of Finance. 20. MISCELLANEOUS PROVISIONS A. Computation of Time Periods. If any date or time period provided for in this Grant Agreement is or ends on a Saturday, Sunday or federal, state or legal holiday, then such date shall automatically be extended until 5:00 p.m. Pacific Time of the next day which is not a Saturday, Sunday or federal, state or legal holiday. B. Counterparts. This Grant Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which, together, shall constitute but one and the same instrument. C. Captions. Any captions to, or headings of, the sections or subsections of this Grant Agreement are solely for the convenience of the parties hereto, are not a part of this Grant Agreement, and shall not be used for the interpretation or determination of the validity of this Grant Agreement or any provision hereof D. No Obligations to Third Parties. Except as otherwise expressly provided herein, the execution and delivery of this Grant Agreement shall not be deemed to confer any rights upon, or obligate any of the parties hereto, to any person or entity other than the parties hereto. E. Exhibits and Schedules. The Exhibits and Schedules attached hereto are hereby incorporated herein by this reference for all purposes. 11 50119225.4 Attachment No. 2 F. Amendment to this Grant Agreement. The terms of this Grant Agreement may not be modified or amended except by an instrument in writing executed by each of the parties hereto. G. Waiver. The waiver or failure to enforce any provision of this Grant Agreement shall not operate as a waiver of any future breach of any such provision or any other provision hereof. H. Applicable Law. This Grant Agreement shall be governed by and construed in accordance with the laws of the State of California. Entire Agreement. This Grant Agreement supersedes any prior agreements, negotiations and communications, oral or written, and contains the entire agreement between the parties as to the subject matter hereof. No subsequent agreement, representation, or promise made by either party hereto, or by or to an employee, officer, agent or representative of any party hereto shall be of any effect unless it is in writing and executed by the party to be bound thereby. J. Successors and Assigns. This Grant Agreement shall be binding upon and shall inure to the benefit of the successors and assigns of the parties hereto. K. Construction. The parties acknowledge and agree that (i) each party is of equal bargaining strength, (ii) each party has actively participated in the drafting, preparation and negotiation of this Grant Agreement, (iii) each such party has consulted with or has had the opportunity to consult with its own, independent counsel and such other professional advisors as such party has deemed appropriate, relative to any and all matters contemplated under this Grant Agreement, (iv) each party and such party's counsel and advisors have reviewed this Grant Agreement, (v) each party has agreed to enter into this Grant Agreement following such review and the rendering of such advice, and (vi) any rule or construction to the effect that ambiguities are to be resolved against the drafting party shall not apply in the interpretation of this Grant Agreement, or any portions hereof, or any amendments hereto. (signatures on following page) 12 50119225.4 IN WITNESS WHEREOF, the parties hereto have executed this Grant Agreement on the date and year first above written. APPROVED AS TO FORM: Christensen & Spath LLP, Successor Agency Special Counsel By: COMMUNITY HOUSINGWORKS, a California nonprofit, public benefit corporation By: Name: Its: SUCCESSOR AGENCY TO THE COMMUNITY DEVELOPMENT COMMISSION AS THE NATIONAL CITY REDEVELOPMENT AGENCY By: Walter F. Spath III, Esq., Partner Name: Ron Morrison Its: Chairman S-1 50119225 National City Phase II Grant Agreement EXHIBIT A Budget for Initial Disbursement of Grant for Phase II 1 Park Remediation $3,000,000 2 I Park Improvements $1,800,000 3 j Civil Engineering $62,300 4Geotechnical Consultant $30,000 5 GC Site Preparation $1,575,000 6 Environmental Consultant $60,000 Total 1 $6,527,300 RESOLUTION NO. 2015 — RESOLUTION OF THE SUCCESSOR AGENCY TO THE COMMUNITY DEVELOPMENT COMMISSION AS THE NATIONAL CITY REDEVELOPMENT AGENCY APPROVING A GRANT AGREEMENT AND ESCROW INSTRUCTIONS BY AND BETWEEN THE SUCCESSOR AGENCY AND COMMUNITY HOUSINGWORKS, PROVIDING A GRANT OF $14,909,000 TO ASSIST DEVELOPMENT OF PHASE II OF AN INFILL AFFORDABLE HOUSING PROJECT, PUBLIC FACILITIES, OPEN SPACES, AND COMMUNITY SERVICES ON 12.75 ACRES FORMERLY KNOWN AS THE NATIONAL CITY PUBLIC WORKS CENTER AND ILLES FAMILY TRUST SITE WHEREAS, Community HousingWorks ("CHW") is a California nonprofit public benefit corporation whose purposes include development and operation of such affordable housing in, among other areas, the County of San Diego; and WHEREAS, the Community Development Commission of the City of National City ("CDC") and Paradise Creek Housing Partners, L.P., a California limited partnership (the "Phase I Developer"), entered into that certain "Disposition and Development Agreement," dated as of June 21, 2011 (the "DDA"), maintained as a public record by the City Clerk of the City of National City ("City"); and WHEREAS, the Redevelopment Agency of the City of National City ("Agency") was established by Ordinance No. 1164, dated April 11, 1967; and WHEREAS, the City formed the CDC and the Housing Authority of the City of National City ("Housing Authority") by Ordinance No. 1484, dated October 14, 1975; and WHEREAS, the CDC was established to enable both the Agency and the Housing Authority to operate under a single board and single entity, responsible for the administration of redevelopment activities within the City of National City; and WHEREAS, on February 1, 2012, the State of California dissolved all California redevelopment agencies, and established successor agencies to the former redevelopment agencies vested with all authority, rights, powers, duties and obligations of the dissolved redevelopment agencies pursuant to California Health and Safety Code Section 34173, said obligations including the payment, and performance and enforcement of enforceable obligations of the dissolved redevelopment agencies; and WHEREAS, the City elected to serve as the successor agency to the CDC in its capacity as the Agency, upon the Agency's dissolution, pursuant to Resolution No. 2012-15 on January 10, 2012, and in that capacity exists and functions as a distinct and separate legal entity named "Successor Agency to the Community Development Commission as the National City Redevelopment Agency" ("Successor Agency"); and WHEREAS, pursuant to the DDA and as more particularly provided therein, the Phase I Developer had the duty to construct, in two (2) Phases, an infill affordable housing project ("Project") on the 12.75 acres known as the former National City Public Works Center and Illes Family Trust site ("Site"); and WHEREAS, per the DDA, the Project would include, without limitation, a total of two hundred one (201) affordable rental housing units, certain community facilities for the use of the residents of both Phase I and Phase II, and certain offsite improvements including, without Resolution No. 2015 — August 18, 2015 Page Two limitation, (a) improvement of the Paradise Creek Parcel, to wit, the Site, and (b) improvement and expansion, for the benefit of the entire community, of "Paradise Creek Educational Park"; and WHEREAS, the obligations of Phase I Developer with respect to the development of Phase II of the Project have been assigned to Paradise Creek II Housing Partners, L.P., a California limited partnership ("Developer"), and WHEREAS, the Successor Agency holds, within its Capital Improvements Fund, the sum of Fourteen Million Nine Hundred Nine Thousand Dollars ($14,909,000.00) to be used to finance development of affordable housing projects such as the Project (the "Funds"); and WHEREAS, the Funds are proceeds of the issuance of those certain "$39,660,000 Community Development Commission of the City of National City (San Diego County, California) (National City Redevelopment Project) 2011 Tax Allocation Bonds" ("Bonds"); and WHEREAS, in accord with its statutory function and operation, the Successor Agency desires also to foster the development of private nonprofit, community -based, service organizations with the capacity to develop and/or finance affordable housing projects in National City such as the Project; and WHEREAS, the Successor Agency, on the terms and conditions set forth in that certain "Grant Agreement and Escrow Instructions" approved by the Successor Agency on August 18, 2015 and maintained by the Clerk as a public record ("Grant Agreement"), granted the Funds, i.e., sum of Fourteen Million Nine Hundred Nine Thousand Dollars ($14,909,000.00), to CHW with the sole purpose that CHW make a loan to Developer for the capital improvements, and thereby finance Phase II's development; and WHEREAS, an anticipated by-product of the Successor Agency's loan to CHW and CHW's role in the Project will be CHW's enhanced capacity to participate in the development of future affordable housing projects in the community; and WHEREAS, pursuant to the Grant Agreement, CHW has pledged to use its income from Developer's re -payment to CHW of Funds derived from the Bonds for programs annually approved by the Executive Director including: 1. Resident and community -based clean-up efforts within the Project; 2. Youth environmental education programming; 3. Jobs -corps type training; 4. To create a matching fund for Project residents saving for home ownership; and 5. To create a first time homebuyer program for Project residents. Resolution No. 2015 — August 18, 2015 Page Three WHEREAS, the Grant Agreement must be approved by both the Oversight Board of the Successor Agency to the Community Development Commission as the National City Redevelopment Agency ("Oversight Board") and the California Department of Finance prior to being effective; and NOW, THEREFORE, BE IT RESOLVED by the Successor Agency to the Community Development Commission as the National City Redevelopment Agency as follows: Section 1. The foregoing recitals are true and correct, and are a substantive part of this Resolution, including the terms defined therein. Section 2. The Successor Agency hereby approves the Grant Agreement, a true and correct copy of which is maintained by the City Clerk as a public record, whereby the Successor Agency and CHW agreed upon the terms and conditions under which the Successor Agency would (i) provide CHW Funds derived from the issuance of Bonds, to wit, a grant of $14,909,000.00, assisting in the development of the Project at the Site by permitting CHW to provide part of the financing for Phase II of the Project, and as a by-product of CHW fulfilling its duties under the Grant Agreement, (ii) enhance CHW's capacity to participate in the development of future affordable housing projects in the community. Section 3. The Chairman of the Successor Agency is hereby authorized and directed to take such other actions and execute such other documents as are necessary to effectuate the intent of this Resolution. Section 4. The Successor Agency has determined that (i) the certified Environmental Impact Report for the Westside Specific Plan ("EIR") analyzed a Transit Oriented Development for the Site, and that the Project's development will comply with the California Environmental Quality Act ("CEQA") and the guidelines adopted in relation thereto ("Guidelines"), and (ii) insofar as this Resolution and the approved Grant Agreement build CHW's capacity to participate in the development of future affordable housing projects in the community, this Resolution does not represent a "project" for purposes of CEQA, as that term is defined by Guidelines section 15378, because this Resolution is an organizational or administrative activity that will not result in a direct or indirect physical change in the environment, per section 15378(b)(5) of the Guidelines. Section 5. The City Clerk shall certify to the adoption of this Resolution. [Signature Page to Follow] Resolution No. 2015 — August 18, 2015 Page Four PASSED and ADOPTED this 18th day of August, 2015. Ron Morrison, Chairman ATTEST: Brad Raulston, Secretary APPROVED AS TO FORM: Claudia G. Silva City Attorney 8/18/2015 PARADISE CREEK NATIONAL CITY, CALIFORNIA TRANSIT ORIENTED DEVELOPMENT - PHASE II GRANT AGREEMENT NATOQe gin ■RELATED it ., Phase II Grant Agreement • $14,909,000 of 2011 Tax Exempt Bonds allocated by the Successor Agency in ROPS for Phase II capital improvements • Tax exempt status of the bonds require funds be granted to Community HousingWorks • Community HousingWorks will loan the grant funds to the Phase II developer • Income from repayment of loan to Community HousingWorks will fund social service programs for the vicinity Changes to Staff Report & Grant Agreement • Last paragraph of Attachment No. 1 Explanation- Continuance from August 4 • Initial Disbursement of Grant increased by approx. $2.7M to fund site preparation costs (Page 3, Section 5.2 and Exhibit A) • Final Disbursement of Grant has decreased by the same (Page 4, Section 5.3) • Total grant amount remains unchanged Phase II Financial Sources Source Funding Amount Infill Infrastructure Grant Affordable Housing Sustainable Communities Grant (Cap & Trade) Successor Agency Funds (Grant Agreement) 4% Low -Income Housing Tax Credits (Estimated Close -March 2016) Developer's Loan (Private Financing) $4,000,000 $8,310,617 $14,909,000 $18,299,411 $3,144,589 1 Attachment No. 1 Redline 8/17/2015 EXPLANATION: Paradise Creek Housing Project Phase II Grant Agreement and Escrow Instructions The Transit -Oriented Infill Affordable Housing and Paradise Creek Enhancement Project, also known as the Westside Infill Transit Oriented Development (WI-TOD) is a 201-unit affordable housing development on the east side of Paradise Creek, and the expansion of Paradise Creek Educational Park on the west side of the creek. The proposed Project is based on a concept that was developed through a neighborhood and stakeholder design participation process and incorporated into the Westside Specific Plan, which was adopted in 2010. The project design was developed with continuing public input and participation through stakeholder and community meetings. In March 2011, the Community Development Commission issued tax exempt bonds in part to assist with the development. The first phase of the development is currently being built on approximately four acres on the southern portion of the site and includes 109 units within two buildings and a separate residential services building. The second phase would be built on approximately two acres on the northern portion of the site and would include 92 units within two buildings. In order to complete financing for the construction of the second phase, the Successor Agency is assisting the second phase with $14,909,000 in bond proceeds from the 2011 tax exempt bonds. Since Paradise Creek II Housing Partners, LP, the developer for the second phase, is a for -profit entity, it is not eligible to receive the tax exempt bond funds directly without impacting the tax exempt status of the bonds. Community HousingWorks, a development partner in the project and a 501(c)3 non-profit, is eligible to receive the funds as a grant. Community HousingWorks would then lend the grant proceeds to the developer of the second phase to build the capital improvements. Income from loan repayment to Community HousingWorks would be used to fund programs approved by the Executive Director of the Successor Agency annually including resident and community -based clean-up efforts for the project, youth environmental education programming, Jobs Corps type training, to create a matching program for resident savings accounts, and to create a first-time home buyer program for project residents. A continuance for this item was requested at the Successor Agency meeting on August 4, 2015 to August 18, 2015 to allow for additional time needed for staff to concur on a mutual indemnification from and against any loss, cost, damage, cause of action, suit, penalty, fine, liability or expense, including, without limitation, attornev's fees, costs of suit or court costs incurred as a result of due to with regard to any claim or demand from any governmental agency having jurisdiction over the Site, including, without limitation, the California Department of Finance, pursuant to its authority under Section Page 1 of 1 Attachment No. 1 Redline 8/17/2015 34179.6(h)(1)(B) of the California Health and Safety Code, or any holder of the Bonds (a "Demand for Grant Recovery") which is proximately caused by any material misrepresentation, gross negligence or fraud as stipulated in Section 5.6 of the proposed Grant Agreement. Page 1 of 1 Attachment No. 2 Redline 8.17.2015 GRANT AGREEMENT AND ESCROW INSTRUCTIONS [Transit -Oriented Infill Affordable Housing and Paradise Creek Enhancement Project] THIS GRANT AGREEMENT AND ESCROW INSTRUCTIONS, dated as of August 2015 for identification purposes only (the "Grant Agreement"), is made and entered into by and between the SUCCESSOR AGENCY TO THE COMMUNITY DEVELOPMENT COMMISSION AS THE NATIONAL CITY REDEVELOPMENT AGENCY (the "Successor Agency"), and COMMUNITY HOUSINGWORKS, a California nonprofit public benefit corporation ("CHW'), with reference to the following: RECITALS A. WHEREAS, CHW is a California nonprofit public benefit corporation whose purposes include development and operation of such affordable housing in, among other areas, the County of San Diego; B. WHEREAS, the Community Development Commission of the City of National City ("CDC") and Paradise Creek Housing Partners, L.P., a California limited partnership (the "Phase I Developer"), entered into that certain "Disposition and Development Agreement," dated as of June 21, 2011 (the "DDA"); C. WHEREAS, the Redevelopment Agency of the City of National City ("Agency") was established by Ordinance No. 1164, dated April 11, 1967. The City formed the CDC and the Housing Authority of the City of National City ("Housing Authority") by Ordinance No. 1484, dated October 14, 1975. The CDC was established to enable both the Agency and the Housing Authority to operate under a single board and single entity. The CDC was responsible for the administration of redevelopment activities within the City of National City; D. WHEREAS, On February 1, 2012, California redevelopment agencies were dissolved, successor agencies were established as successor agencies to the former redevelopment agencies pursuant to Health and Safety Code Section 34173, and successor agencies were tasked with, among other things, paying, and performing and enforcing the enforceable obligations of the former redevelopment agencies. The City elected to serve as the successor agency to the CDC upon the dissolution of the Redevelopment Agency, pursuant to Resolution No. 2012-15 on January 10, 2012. The Successor Agency is a distinct and separate legal entity from the City, and is named "Successor Agency to the Community Development Commission as the National City Redevelopment Agency" ("Successor Agency"); E. WHEREAS, pursuant to the DDA and as more particularly provided therein, Phase I Developer will construct, in two (2) Phases, the Scope of Development on the Site (the "Project"), including, without limitation, a total of two hundred one (201) affordable rental housing units, certain community facilities for the use of the residents of both Phase I and Phase II, and certain offsite improvements including, without limitation, (i) improvement of the Paradise Creek Parcel, and (b) improvement and expansion, for the benefit of the entire community, of Paradise Creek Educational Park; F. WHEREAS, the obligations of Phase I Developer with respect to the development of Phase II have been assigned to Paradise Creek II Housing Partners, L.P., a California limited partnership ("Developer"), pursuant to that certain Assignment and Assumption Agreement by and between Phase I Developer and Developer dated as of , 2015; 50119225.4 Attachment No. 2 Redline Rev. 8.17.2015 G. WHEREAS, Successor Agency holds, within its Capital Improvements Fund, the sum of Fourteen Million Nine Hundred Nine Thousand Dollars ($14,909,000) to be used to finance development of affordable housing projects such as the Project (the "Funds"); H. WHEREAS, the Funds are proceeds of that certain "$39,660,000 Community Development Commission of the City of National City (San Diego County, California) (National City Redevelopment Project) 2011 Tax Allocation Bonds" (the "Bonds"); I. WHEREAS, Successor Agency desires also to foster the development of private nonprofit, community -based, service organizations with the capacity to develop and/or finance affordable housing projects in National City such as the Project: and J. WHEREAS, accordingly, Successor Agency, on the terms and conditions set forth in this Grant Agreement, intends to grant the sum of Fourteen Million Nine Hundred Nine Thousand Dollars ($14,909,000) to CHW for the purpose of permitting CHW to provide part of the financing for Phase II of the Project. NOW, THEREFORE, for and in consideration of the mutual promises, covenants, and conditions herein contained, Successor Agency and CHW agree as follows: 1. DEFINITIONS AND INTERPRETATION 1.1 Defined Terms. Capitalized words and terms used in this Grant Agreement and not defined in this Grant Agreement (including, without limitation, in the Recitals above) shall have the meanings ascribed thereto in the DDA. Other capitalized words and terms used in this Grant Agreement shall have the meanings ascribed thereto where first used or as set forth in this Section 1.1. Capitalized terms used in an exhibit attached hereto and not defined therein shall also have the meanings set forth in this Section 1.1. "CHW Loan Note" means the promissory note to be made by Developer to evidence the CHW Loan. "DDA" shall mean that certain Disposition and Development Agreement, dated as of June 21, 2011, by and between CDC and Developer, as such document may be amended and implemented by the parties thereto and as assigned, with respect to Phase II, by Phase I Developer to Developer. "Grant for Phase II" has the meaning set forth in Section 5.1 of this Grant Agreement. 1.2 Singular and Plural Terms. Any defined term used in the plural in this Grant Agreement shall refer to all members of the relevant class and any defined term used in the singular shall refer to any number of the members of the relevant class. 1.3 Accounting Principles. Any accounting term used and not specifically defined in this Grant Agreement shall be construed in conformity with, and all financial data required to be submitted under this Grant Agreement shall be prepared in conformity with, generally accepted accounting principles applied on a consistent basis or in accordance with such other principles or methods as are reasonably acceptable to Successor Agency. 2 50119225.4 Attachment No. 2 Redline Rev. 8.17.2015 1.4 References and Other Terms. References herein to Articles, Sections and Exhibits shall be construed as references to this Grant Agreement unless a different document is named. References to subparagraphs shall be construed as references to the same Section in which the reference appears. The terms "including" and "include" mean "including (include) without limitation". 1.5 Exhibits Incorporated. All attachments to this Grant Agreement, as now existing and as the same may from time to time be modified, are incorporated herein by this reference. 2. PARTIES 2.1 Successor Agency. Successor Agency is the Successor Agency of the CDC and any successor to its rights, powers and responsibilities. The principal offices of Successor Agency are located at 1243 National City Boulevard, National City, California 91950. 2.2 CHW. CHW is Community HousingWorks, a California nonprofit, public benefit corporation. The principal offices of CHW are located at 2815 Camino del Rio South, Suite 350, Suite 550, San Diego, California, 92108. 3. INTENTIONALLY OMITTED 4. SUCCESSOR AGENCY RIGHT TO TERMINATE If the DDA terminates prior to the Close of Escrow for Phase II, then Successor Agency, in addition to any and all other rights it may have to terminate this Grant Agreement, shall have the right to terminate this Grant Agreement by notice to CHW. 5. GRANT 5.1 Amount and Purpose. Subject to the terms and conditions of this Grant Agreement, Successor Agency agrees to make a grant to CHW for Phase II (the "Grant for Phase II") in the amount of Fourteen Million Nine Hundred Nine Thousand Dollars ($14,909,000) to be used for the sole purpose of CHW making the CHW Loan for Phase II to Developer. Uses of the proceeds of the CHW Loan by Developer shall be limited to costs of construction of capital improvements with a projected useful life of at least 30 years, including, without limitation, predevelopment and other soft costs directly associated with such capital improvements, as permitted pursuant to the documents governing the Bonds (collectively, "Permissible Uses"). Notwithstanding anything herein to the contrary, the Successor Agency hereby acknowledges and agrees that the costs listed on the Budget for Grant Agreement attached hereto as Exhibit A constitute Permissible Uses hereunder. The CHW Loan Agreement (as defined below) shall obligate Developer, in its capacity as Borrower, to use the proceeds of the CHW Loan only for Permissible Uses as defined herein. 5.2 Conditions to Initial Disbursement of Grant for Phase II. Successor Agency's obligation to make and disburse Nine Million Two Hundred Thirty Two Thousand Three Hundred Seventy Five Dollars ($9,232,375) of the Grant for Phase II (the "Initial Disbursement") shall be subject to satisfaction of the following conditions precedent: 3 50119225.4 Attachment No. 2 Redline Rev. 8.17.2015 (a) Loan Agreement. CHW, as lender, and Developer, as borrower, enter into a loan agreement, approved by the Executive Director (including, without limitation, all underlying loan documents), pursuant to which CHW uses the Grant for Phase II proceeds for the purpose of making the CHW Loan to Developer on terms and conditions consistent with the DDA (the "CHW Loan Agreement"). At the time of the Initial Disbursement, until the Close of Escrow for Phase II, the CHW Loan shall be secured exclusively by the Work Product (as defined in CHW Loan Agreement), and neither CHW nor the Successor Agency shall have any additional security with respect to the CHW Loan other than the Work Product. Among other things, the CHW Loan Agreement shall provide that: (1) neither it, nor any of its accompanying documents (including, without limitation, the promissory note evidencing and/or the deed of trust that will, following the Close of Escrow for Phase II, secure the CHW Loan) may be amended, modified or rescinded without the prior written approval of the Executive Director, which approval shall not be unreasonably withheld, and the Successor Agency shall be named a third - party beneficiary of the same and (2) proceeds of the CHW Loan shall be used only for Permissible Uses. (b) No Default. No default by CHW under this Grant Agreement shall then exist, and no event shall then exist which, with the giving of notice or the passage of time or both, would constitute such a default by CHW and, if requested by the Executive Director, Successor Agency shall have received a certificate to that effect signed by CHW. 5.3 Conditions to Final Disbursement of Grant for Phase II. The remaining Five Million Six Hundred Seventy Six Thousand Six Hundred Twenty Five€ight Milli�o. Tie Dollars ($5,676,6258,34S1489) of the Grant for Phase II (the "Final Disbursement") shall be disbursed concurrently with the execution and delivery of this Grant Agreement, to an escrow account held by Old Republic Title Company ("Escrow Agent") pursuant to escrow instructions which are mutually acceptable to the Successor Agency and CHW. The Escrow Agent shall disburse upon satisfaction of the following conditions precedent: (a) Close of Escrow for Phase II. Escrow for Phase II must dose concurrently. (b) Loan Agreement and Deed of Trust. The CHW Loan Agreement shall be in full force and effect and no default shall exist thereunder. CHW and Developer shall cause to be recorded a second priority deed of trust securing Developer's obligation to repay CHW Loan in the Official Records. (c) Disbursement Agreement. CHW, the Phase II Construction Lender and Successor Agency have entered into an agreement for disbursement of the Construction Amount of the Grant for Phase II substantially similar to the Construction Lender/Successor Agency Disbursement Agreement for Phase II and such agreement has been approved by Developer and the Tax Credit Partner for Phase II. (d) Insurance. Successor Agency has received satisfactory evidence that the insurance required pursuant to the Ground Lease for Phase II is in full force and effect. (e) Representations and Warranties. The representations of CHW contained in this Grant Agreement shall be correct in all material respects as of the Close of Escrow for Phase II as though made on and as of that date and, if requested by the Executive Director, Successor Agency shall have received a certificate to that effect signed by CHW. 4 50119225.4 Attachment No. 2 Redline Rev. 8.17.2015 (f) No Default. No default by CHW under this Grant Agreement shall then exist, and no event shall then exist which, with the giving of notice or the passage of time or both, would constitute such a default by CHW and, if requested by the Executive Director, Successor Agency shall have received a certificate to that effect signed by CHW. (g) Use of Proceeds. Successor Agency has received a certification from the Developer certifying that (i) that the proceeds of the CHW Loan spent by Developer to date have been used only for Permissible Uses and (ii) unspent proceeds of the CHW Loan and proceeds of the Final Disbursement will be used only for Permissible Uses. 5.4 Disbursement of Grant for Phase II. The Initial Disbursement of the Grant for Phase II shall, subject to the terms and conditions of this Grant Agreement, be delivered directly to CHW and shall be disbursed therefrom on or about the date hereof to pay predevelopment expenses and certain site improvements in accordance with the Final Project Budget for Phase II. Successor Agency acknowledges and agrees that, should Close of the Phase II Escrow and/or the completion of Phase II of the Project not occur, Successor Agency, as fee owner of the Site, will have nonetheless received a benefit based on the predevelopment work and site improvements funded by the Initial Disbursement. The Final Disbursement of the Grant for Phase II shall, subject to the terms and conditions of this Grant Agreement, be deposited into the Phase II Escrow in time to permit the close thereof and shall be disbursed therefrom at Close of the Phase II Escrow (a) to pay closing costs and expenses shown on the closing statement for the Phase II Escrow, and (b) to the Construction Lender for Phase II for deposit into a construction account from which disbursements shall be made periodically by the Construction Lender only to pay Phase II Project Costs in accordance with the Final Project Budget for Phase II. 5.5 Return of Grant for Phase II. Notwithstanding anything herein to the contrary, if construction of Phase II of the Project has not commenced on or before December 31, 2018 (as the same may be extended with the consent of the Executive Director), to the extent any portion of the Grant for Phase II has (a) not yet been disbursed to Developer or (b) disbursed to Developer and repaid pursuant to the terms of the CHW Loan Agreement, such undisbursed or repaid funds shall be returned from CHW to the Successor Agency. 5.6 DOF and Oversight Board Approval. The parties hereto acknowledge and agree that this Grant Agreement is subject to review and approval by the Oversight Board to the Successor Agency and the California Department of Finance and that, notwithstanding anything herein to the contrary, the Grant Agreement shall not be deemed effective until the Successor Agency has obtained such approval from the Oversight Board to the Successor Agency and the California Department of Finance. Therefore, the Successor Agency and CHW acknowledge and agree that, upon receipt of such approvals, the Grant for Phase II is an unconditional and irrevocable obligation of the Successor Agency and cannot be recalled by the Successor Agency due to any claim or demand from any governmental agency having jurisdiction over the Site, including, without limitation, the California Department of Finance, pursuant to its authority under Section 34179.6(h)(1)(B) of the California Health and Safety Code, or any holder of the Bonds (a "Demand for Grant Recovery"). Without limiting the generality of the foregoing, (i) the Successor Agency hereby agrees to indemnify, defend, protect and hold harmless CHW, its officers, directors, partners, members, affiliates, employees, agents, successors and assigns from and against any loss, cost, damage, cause of action, suit, penalty, fine, liability or expense, including, without limitation, attorney's fees, costs of suit or court costs incurred as a result of a Demand for Grant Recovery which is proximately caused by any material misrepresentation, gross negligence or fraud by the Successor Agency, whether or 5 50119225.4 Attachment No. 2 Redline Rev. 8.17.2015 not such Demand for Grant Recovery is successful; and (ii) CHW hereby agrees to indemnify, defend, protect and hold harmless the Successor Agency, its officers, directors, partners, members, affiliates, employees, agents, successors and assigns from and against any loss, cost, damage, cause of action, suit, penalty, fine, liability or expense, including, without limitation, attorneys' fees, costs of suit or court costs incurred as a result of a Demand for Grant Recovery which is proximately caused by any material misrepresentation, gross negligence or fraud by CHW, whether or not such Demand for Grant Recovery is successful. 6. PROGRAM INCOME 6.1 Defined. For the purposes of this Grant Agreement, "Program Income" shall mean all funds collected by CHW in repayment of the CHW Loan. 6.2 Use of Program Income. CHW shall use the Program Income to fund social and educational programming and activities for the benefit of the Project, its residents and the residents of the community of which the Project is a part (the "Paradise Creek -Related Programs and Activities"). Such programs and activities could include, without limitation: (a) resident and/or community -based cleanup efforts in and around the Project, including, without limitation, in and around the Paradise Creek Parcel and/or Paradise Creek Education Park; provided, however, such efforts may not include routine and/or regular maintenance of such property; (b) youth environmental education programming; (c) job corps -type training programs; (d) as matching funds for individual development accounts to assist people of modest means save for the purchase of a lifelong asset, such as a home; or to obtain education and/or job training; and education and coaching programs related to personal finance and credit management; (e) to make first-time homebuyer down payment loans and related homebuyer education and coaching programs; and/or (f) other activities as approved in advance by the Executive Director. 6.3 Submission of Annual Plan. Not later than thirty (30) days after first receipt by CHW of Program Income and every year thereafter for which CHW receives any Program Income, CHW shall submit to the Executive Director for approval (which approval shall not be unreasonably withheld) a plan and budget for the Paradise Creek -Related Programs and Activities that CHW proposes to fund and operate over the ensuing one (1)-year period (the "Annual Plan"). That notwithstanding, the Executive Director shall be under no obligation to allow use of the Program Income to fund programs and activities otherwise obligated to be provided by the Tenant under the Ground Lease for Phase II. Additionally, if the Program Income received by CHW for any year or succession of years is insufficient to fund and operate any meaningful Paradise Creek -Related Programs and Activities for the ensuing year, CHW may, with the written consent of the Executive Director (which consent shall not be unreasonably withheld) accumulate funds until sufficient by holding 6 50119225.4 Attachment No. 2 Redline Rev. 8.17.2015 such funds (unless de minimis) in an interest -bearing account, with such interest to become Program Income. 6.4 Implementation of Annual Plan. Promptly after approval of any Annual Plan, CHW shall implement that Annual Plan. 6.5 Acknowledgment of City. Any and all Paradise Creek -Related Programs and Activates printed and/or digital materials, including signage, shall acknowledge, in a manner reasonably satisfactory to the Executive Director, the contribution of the City of National City to the funding of the subject program and/or activity. 6.6 Enforcement of CHW Loan Note. In order to reasonably maximize Program Income, CHW shall reasonably enforce payment of the CHW Loan Note. 7. GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS 7.1 CHW's Formation, Qualification and Compliance. CHW (a) is validly existing and in good standing under the laws of the State of California, (b) has all requisite authority to conduct its business, and has all requisite authority to execute and perform its obligations under this Grant Agreement. 7.2 Litigation. CHW represents and warrants that there are no material actions, lawsuits or proceedings pending or, to the best of CHWs knowledge, threatened against or affecting CHW, the adverse outcome of which could have a material adverse effect on CHW's ability to perform its obligations under this Grant Agreement. 8. RETENTION OF RECORDS CHW shall maintain all books, documents, papers, accounting records, and other evidence pertaining to this Grant Agreement and shall make such materials available at its office at all reasonable times during the term of this Grant Agreement and for three (3) years from the date of Close of Escrow for Phase II for inspection by Successor Agency and for furnishing of copies to Successor Agency, if requested. 9. INDEPENDENT CONTRACTOR Both parties hereto in the performance of this Grant Agreement will be acting in an independent capacity and not as agents, employees, partners or joint venturers with one another. Neither CHW nor CHWs employees are employees of Successor Agency and are not entitled to any of the rights, benefits, or privileges of Successor Agency's employees, including but not limited to retirement, medical, unemployment, or workers' compensation insurance. 10. CONTROL Neither Successor Agency nor its officers, agents or employees shall have any control over the conduct of CHW or any of CHW's employees except as herein set forth, and CHW expressly agrees not to represent that CHW or CHW's agents, servants, or employees are in any manner agents, servants or employees of Successor Agency, it being understood that CHW, its agents, servants, and employees are as to Successor Agency wholly independent contractors and that CHWs obligations to Successor Agency are solely such as are prescribed by this Grant Agreement. 7 50119225.4 Attachment No. 2 Redline Rev. 8.17.2015 11. COMPLIANCE WITH APPLICABLE LAW CHW, in the performance of this Grant Agreement, shall comply with all applicable State and Federal statutes and regulations, and all applicable ordinances of the City of National City, whether now in force or subsequently enacted. CHW, and each of its subcontractors, shall obtain and maintain a current City of National City business license prior to and during performance of any work pursuant to this Grant Agreement. 12. NON-DISCRIMINATION PROVISIONS In the performance of this Agreement, CHW shall: (a) not discriminate against any employee or applicant for employment because of age, race, color, ancestry, religion, sex, sexual orientation, marital status, national origin, physical handicap, or medical condition; and (b) take positive action to insure that applicants are employed without regard to their age, race, color, ancestry, religion, sex, sexual orientation, marital status, national origin, physical handicap, or medical condition. Such action shall include but not be limited to the following: employment, upgrading, demotion, transfer, recruitment or recruitment advertising, layoff or termination, rates of pay or other forms of compensation, and selection for training, including apprenticeship. 13. INDEMNIFICATION AND HOLD HARMLESS CHW agrees to defend, indemnify, and hold harmless Successor Agency and the City of National City, and their officers and employees, against and from any and all liability, loss, damages to property, injuries to, or death of any person or persons, and all claims, demands, suits, actions, proceedings, reasonable attorneys' fees, and- defense costs, of any kind or nature, including workers' compensation claims, of or by anyone whomsoever, resulting from or arising out of CHW's negligent performance of this Grant Agreement. 14. INSURANCE CHW shall cause the Developer to purchase and maintain, and to require its contractors, if any, to purchase and maintain, until issuance of the Certificate of Completion for Phase II, the following insurance policies: A. Automobile insurance covering all bodily injury and property damage incurred during the performance of this Grant Agreement, with a minimum coverage of $1,000,000 combined single limit per accident. Such automobile insurance shall include owned, non -owned, and hired vehicles ("any auto"). B. Commercial general liability insurance, with minimum limits of $2,000,000 per occurrence $4,000,000 aggregate, covering all bodily injury and property damage arising out of its operations under this Grant Agreement. C. Workers' compensation insurance in an amount sufficient to meet statutory requirements covering all of CHW employees and employers' liability insurance with limits of at least $1,000,000 per accident. In addition, the policy shall be endorsed with a waiver of subrogation in favor of Successor Agency. Said endorsement shall be provided prior to commencement of work under this Grant Agreement. 8 50119225.4 Attachment No. 2 Redline Rev. 8.17.2015 D. The aforesaid policies shall constitute primary insurance as to Successor Agency, its officers, employees, and volunteers, so that any other policies held by Successor Agency shall not contribute to any loss under said insurance. Said policies shall provide for thirty (30) days prior written notice to Successor Agency of cancellation or material change. E. Said policies, except for the professional liability and workers' compensation policies, shall name Successor Agency, CDC and the City of National City, and their officers, agents and employees as additional insureds, and separate additional insured endorsements shall be provided. F. If required insurance coverage is provided on a "claims made" rather than "occurrence" form, CHW shall cause Developer to maintain such insurance coverage for three years after expiration of the term (and any extensions) of this Grant Agreement. In addition, the "retro" date must be on or before the date of this Grant Agreement. G. Any aggregate insurance limits must apply solely to this Grant Agreement. H. Insurance shall be written with only California admitted companies which hold a current policy holder's alphabetic and financial size category rating of not less than A VIII according to the current Best's Key Rating Guide, or a company equal financial stability that is approved by Successor Agency's Risk Manager. In the event coverage is provided by non -admitted "surplus lines" carriers, they must be included on the most recent California List of Eligible Surplus Lines Insurers (LESLI list) and otherwise meet rating requirements. I. This Grant Agreement shall not take effect until certificate(s) or other sufficient proof that these insurance provisions have been complied with, are filed with and approved by Successor Agency's Risk Manager. If CHW does not cause Developer to keep all of such insurance policies in full force and effect at all times required under this Grant Agreement, Successor Agency may elect to treat the failure to maintain the requisite insurance as a breach of this Grant Agreement and, subject to the right to notice and cure set forth in Section 17.A, terminate this Grant Agreement as provided herein. J. All deductibles and self -insured retentions in excess of $10,000 must be disclosed to and approved by Successor Agency. 15. LEGAL FEES If any party brings a suit or action against the other party arising from any breach of any of the covenants or agreements or any inaccuracies in any of the representations and warranties on the part of the other party arising out of this Grant Agreement, then in that event, the prevailing party in such action or dispute, whether by final judgment or out -of -court settlement, shall be entitled to have and recover of and from the other party all reasonable costs and expenses of suit, including reasonable attorneys' fees. For purposes of determining who is to be considered the prevailing party, it is stipulated that attorney's fees incurred in the prosecution or defense of the action or suit shall not be considered in determining the amount of the judgment or award. 9 50119225.4 Attachment No. 2 Redline Rev. 8.17.2015 16. MEDIATION/ARBITRATION If a dispute arises out of or relates to this Grant Agreement, or the breach thereof, the parties agree first to try, in good faith, to settle the dispute by mediation in San Diego, California, in accordance with the Commercial Mediation Rules of the American Arbitration Association (the "AAA") before resorting to arbitration. The costs of mediation shall be borne equally by the parties. Any controversy or claim arising out of, or relating to, this Grant Agreement, or breach thereof, which is not resolved by mediation shall be settled by arbitration in San Diego, California, in accordance with the Commercial Arbitration Rules of the AAA then existing. Any award rendered shall be final and conclusive upon the parties, and a judgment thereon may be entered in any court having jurisdiction over the subject matter of the controversy. The expenses of the arbitration shall be borne equally by the parties to the arbitration, provided that each party shall pay for and bear the costs of its own experts, evidence and attorneys' fees, except that the arbitrator may assess such expenses or any part thereof against a specified party as part of the arbitration award. 17. TERMINATION A. This Grant Agreement may be terminated by Successor Agency for cause in the event of a material breach of this Grant Agreement and failure by CHW to cure such breach within thirty (30) days after the giving of notice by Successor Agency. If, however, by its nature the failure cannot reasonably be cured within thirty (30) days, CHW may have such longer period of time as is reasonably necessary to cure the failure, provided, however, that CHW commence said cure within said thirty (30)-day period, and thereafter diligently prosecute said cure to completion within one hundred eighty (180) days. B. Termination with cause shall be effected by delivery of written Notice of Termination to CHW as provided for herein. C. Upon termination of this Grant Agreement pursuant to the terms hereof, Successor Agency shall have no obligation to disburse any outstanding portions of the Grant for Phase II. 18. NOTICES All notices or other communications required or permitted hereunder shall be in writing, and shall be personally delivered; or sent by overnight mail (Federal Express or the like); or sent by registered or certified mail, postage prepaid, return receipt requested; or sent by ordinary mail, postage prepaid; or telegraphed or cabled; or delivered or sent by telex, telecopy, facsimile or fax; and shall be deemed received upon the earlier of (i) if personally delivered, the date of delivery to the address of the person to receive such notice, (ii) if sent by overnight mail, the business day following its deposit in such overnight mail facility, (iii) if mailed by registered, certified or ordinary mail, five (5) days (ten (10) days if the address is outside the State of California) after the date of deposit in a post office, mailbox, mail chute, or other like facility regularly maintained by the United States Postal Service, (iv) if given by telegraph or cable, when delivered to the telegraph company with charges prepaid, or (v) if given by telex, telecopy, facsimile or fax, when sent. Any notice, request, demand, direction or other communication delivered or sent as specified above shall be directed to the following persons: To the Successor Agency: Successor Agency to the Community Development Commission as the National City Redevelopment 10 50119225.4 To CHW: Attachment No. 2 Redline Rev. 8.17.2015 Agency 1243 National City Blvd. National City, California 91950 Attn: Executive Director Community HousingWorks 2815 Camino del Rio South, Suite 350 San Diego, California 92108 Attn: Anne B. Wilson, Sr. VP of Housing & Real Estate Development Notice of change of address shall be given by written notice in the manner specified in this Section. Rejection or other refusal to accept or the inability to deliver because of changed address of which no notice was given shall be deemed to constitute receipt of the notice, demand, request or communication sent. Any notice, request, demand, direction or other communication sent by cable, telex, telecopy, facsimile or fax must be confirmed within forty-eight (48) hours by letter mailed or delivered as specified in this Section. 19. DEPARTMENT OF FINANCE APPROVAL The parties hereto acknowledge and agree that this Grant Agreement is subject to review and approval by the Oversight Board to the Successor Agency and the California Department of Finance and that, notwithstanding anything herein to the contrary, the Grant Agreement shall not be deemed effective until the Successor Agency has obtained such approval from the Oversight Board to the Successor Agency and the California Department of Finance. 20. MISCELLANEOUS PROVISIONS A. Computation of Time Periods. If any date or time period provided for in this Grant Agreement is or ends on a Saturday, Sunday or federal, state or legal holiday, then such date shall automatically be extended until 5:00 p.m. Pacific Time of the next day which is not a Saturday, Sunday or federal, state or legal holiday. B. Counterparts. This Grant Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which, together, shall constitute but one and the same instrument. C. Captions. Any captions to, or headings of, the sections or subsections of this Grant Agreement are solely for the convenience of the parties hereto, are not a part of this Grant Agreement, and shall not be used for the interpretation or determination of the validity of this Grant Agreement or any provision hereof D. No Obligations to Third Parties. Except as otherwise expressly provided herein, the execution and delivery of this Grant Agreement shall not be deemed to confer any rights upon, or obligate any of the parties hereto, to any person or entity other than the parties hereto. E. Exhibits and Schedules. The Exhibits and Schedules attached hereto are hereby incorporated herein by this reference for all purposes. 11 50119225.4 Attachment No. 2 Redline Rev. 8.17.2015 F. Amendment to this Grant Agreement. The terms of this Grant Agreement may not be modified or amended except by an instrument in writing executed by each of the parties hereto. G. Waiver. The waiver or failure to enforce any provision of this Grant Agreement shall not operate as a waiver of any future breach of any such provision or any other provision hereof. H. Applicable Law. This Grant Agreement shall be governed by and construed in accordance with the laws of the State of California. I. Entire Agreement. This Grant Agreement supersedes any prior agreements, negotiations and communications, oral or written, and contains the entire agreement between the parties as to the subject matter hereof. No subsequent agreement, representation, or promise made by either party hereto, or by or to an employee, officer, agent or representative of any party hereto shall be of any effect unless it is in writing and executed by the party to be bound thereby. J. Successors and Assigns. This Grant Agreement shall be binding upon and shall inure to the benefit of the successors and assigns of the parties hereto. K. Construction. The parties acknowledge and agree that (i) each party is of equal bargaining strength, (ii) each party has actively participated in the drafting, preparation and negotiation of this Grant Agreement, (iii) each such party has consulted with or has had the opportunity to consult with its own, independent counsel and such other professional advisors as such party has deemed appropriate, relative to any and all matters contemplated under this Grant Agreement, (iv) each party and such party's counsel and advisors have reviewed this Grant Agreement, (v) each party has agreed to enter into this Grant Agreement following such review and the rendering of such advice, and (vi) any rule or construction to the effect that ambiguities are to be resolved against the drafting party shall not apply in the interpretation of this Grant Agreement, or any portions hereof, or any amendments hereto. (signatures on following page) 12 50119225.4 IN WITNESS WHEREOF, the parties hereto have executed this Grant Agreement on the date and year first above written. APPROVED AS TO FORM: Christensen & Spath LLP, Successor Agency Special Counsel By: COMMUNITY HOUSINGWORKS, a California nonprofit, public benefit corporation By: Name: Its: SUCCESSOR AGENCY TO THE COMMUNITY DEVELOPMENT COMMISSION AS THE NATIONAL CITY REDEVELOPMENT AGENCY By: Walter F. Spath III, Esq., Partner Name: Ron Morrison Its: Chairman S-1 50119225 National City Phase II Grant Agreement EXHIBIT A $3,000,000 $1,800,000 9 $62,300 4 $56 g05 5 GC Site Preparation $1,575,000 6 $60,000 Total $6,527, 300 EXHIBIT A Budget for Grant Agreement 1 Park Remediation 2 Park Improvements 3 GC Site Preparation including Site Remediation 4 Total Predevelopment Scope of Work Grand Total Predevelopment Scope of Work (Detail) Architecture 2 Landscape Architecture 3 Civil Engineering 4 Environmental Engineering 5 Geotechnical Engineering 6 Title 24/MEP Peer Review 7 Utility Consultant 8 Sustainability g Other Architects & Engineers 10 Blueprinting / Printing / Copying 11 Appraisals & Market Studies 12 Interior Design Coordinator 13 Zoning Approvals 14 TCAC Application Fee 15 TCAC Performance Deposit Grand Total Exhibit '`A" $3,000,000 $1,800,000 $2,289,284 $2,143,091 $9,232,375 $433,185 $90,000 $250,000 $72,000 $150.000 $55.000 $50,000 $20.000 $60.000 $11,500 $8,000 $8,000 $873,406 $2,000 $60,000 $2,143,091 Page 1 of 1 Attachment No. 1 Clean Revised 8/17/2015 EXPLANATION: Paradise Creek Housing Project Phase II Grant Agreement and Escrow Instructions The Transit -Oriented Infill Affordable Housing and Paradise Creek Enhancement Project, also known as the Westside Infill Transit Oriented Development (WI-TOD) is a 201-unit affordable housing development on the east side of Paradise Creek, and the expansion of Paradise Creek Educational Park on the west side of the creek. The proposed Project is based on a concept that was developed through a neighborhood and stakeholder design participation process and incorporated into the Westside Specific Plan, which was adopted in 2010. The project design was developed with continuing public input and participation through stakeholder and community meetings. In March 2011, the Community Development Commission issued tax exempt bonds in part to assist with the development. The first phase of the development is currently being built on approximately four acres on the southern portion of the site and includes 109 units within two buildings and a separate residential services building. The second phase would be built on approximately two acres on the northern portion of the site and would include 92 units within two buildings. In order to complete financing for the construction of the second phase, the Successor Agency is assisting the second phase with $14,909,000 in bond proceeds from the 2011 tax exempt bonds. Since Paradise Creek II Housing Partners, LP, the developer for the second phase, is a for -profit entity, it is not eligible to receive the tax exempt bond funds directly without impacting the tax exempt status of the bonds. Community HousingWorks, a development partner in the project and a 501(c)3 non-profit, is eligible to receive the funds as a grant. Community HousingWorks would then lend the grant proceeds to the developer of the second phase to build the capital improvements. Income from loan repayment to Community HousingWorks would be used to fund programs approved by the Executive Director of the Successor Agency annually including resident and community -based clean-up efforts for the project, youth environmental education programming, Jobs Corps type training, to create a matching program for resident savings accounts, and to create a first-time home buyer program for project residents. A continuance for this item was requested at the Successor Agency meeting on August 4, 2015 to August 18, 2015 to allow for additional time needed for staff to concur on a mutual indemnification from and against any loss, cost, damage, cause of action, suit, penalty, fine, liability or expense, including, without limitation, attorney's fees, costs of suit or court costs incurred as a result of due to with regard to any claim or demand from any governmental agency having jurisdiction over the Site, including, without limitation, the California Department of Finance, pursuant to its authority under Section 34179.6(h)(1)(B) of the California Health and Safety Code, or any holder of the Bonds (a "Demand for Grant Recovery") which is proximately caused by any material misrepresentation, gross negligence or fraud as stipulated in Section 5.6 of the proposed Grant Agreement. Page 1 of 1 Attachment No. 2 Clean Rev. 8.17.2015 GRANT AGREEMENT AND ESCROW INSTRUCTIONS [Transit -Oriented Infill Affordable Housing and Paradise Creek Enhancement Project] THIS GRANT AGREEMENT AND ESCROW INSTRUCTIONS, dated as of August , 2015 for identification purposes only (the "Grant Agreement"), is made and entered into by and between the SUCCESSOR AGENCY TO THE COMMUNITY DEVELOPMENT COMMISSION AS THE NATIONAL CITY REDEVELOPMENT AGENCY (the "Successor Agency"), and COMMUNITY HOUSINGWORKS, a California nonprofit public benefit corporation ("CHW'), with reference to the following: RECITALS A. WHEREAS, CHW is a California nonprofit public benefit corporation whose purposes include development and operation of such affordable housing in, among other areas, the County of San Diego; B. WHEREAS, the Community Development Commission of the City of National City ("CDC") and Paradise Creek Housing Partners, L.P., a California limited partnership (the "Phase I Developer"), entered into that certain "Disposition and Development Agreement," dated as of June 21, 2011 (the "DDA"); C. WHEREAS, the Redevelopment Agency of the City of National City ("Agency") was established by Ordinance No. 1164, dated April 11, 1967. The City formed the CDC and the Housing Authority of the City of National City ("Housing Authority") by Ordinance No. 1484, dated October 14, 1975. The CDC was established to enable both the Agency and the Housing Authority to operate under a single board and single entity. The CDC was responsible for the administration of redevelopment activities within the City of National City; D. WHEREAS, On February 1, 2012, California redevelopment agencies were dissolved, successor agencies were established as successor agencies to the former redevelopment agencies pursuant to Health and Safety Code Section 34173, and successor agencies were tasked with, among other things, paying, and performing and enforcing the enforceable obligations of the former redevelopment agencies. The City elected to serve as the successor agency to the CDC upon the dissolution of the Redevelopment Agency, pursuant to Resolution No. 2012-15 on January 10, 2012. The Successor Agency is a distinct and separate legal entity from the City, and is named "Successor Agency to the Community Development Commission as the National City Redevelopment Agency" ("Successor Agency"); E. WHEREAS, pursuant to the DDA and as more particularly provided therein, Phase I Developer will construct, in two (2) Phases, the Scope of Development on the Site (the "Project"), including, without limitation, a total of two hundred one (201) affordable rental housing units, certain community facilities for the use of the residents of both Phase I and Phase II, and certain offsite improvements including, without limitation, (i) improvement of the Paradise Creek Parcel, and (b) improvement and expansion, for the benefit of the entire community, of Paradise Creek Educational Park; F. WHEREAS, the obligations of Phase I Developer with respect to the development of Phase II have been assigned to Paradise Creek II Housing Partners, L.P., a California limited partnership ("Developer"), pursuant to that certain Assignment and Assumption Agreement by and between Phase I Developer and Developer dated as of , 2015; Paradise Creek TOD Phase II Grant Agreement Final Attachment No. 2 Clean Rev. 8.17.2015 G. WHEREAS, Successor Agency holds, within its Capital Improvements Fund, the sum of Fourteen Million Nine Hundred Nine Thousand Dollars ($14,909,000) to be used to finance development of affordable housing projects such as the Project (the "Funds"); H. WHEREAS, the Funds are proceeds of that certain "$39,660,000 Community Development Commission of the City of National City (San Diego County, California) (National City Redevelopment Project) 2011 Tax Allocation Bonds" (the "Bonds"); WHEREAS, Successor Agency desires also to foster the development of private nonprofit, community -based, service organizations with the capacity to develop and/or finance affordable housing projects in National City such as the Project; and J. WHEREAS, accordingly, Successor Agency, on the terms and conditions set forth in this Grant Agreement, intends to grant the sum of Fourteen Million Nine Hundred Nine Thousand Dollars ($14,909,000) to CHW for the purpose of permitting CHW to provide part of the financing for Phase II of the Project. NOW, THEREFORE, for and in consideration of the mutual promises, covenants, and conditions herein contained, Successor Agency and CHW agree as follows: 1. DEFINITIONS AND INTERPRETATION 1.1 Defined Terms. Capitalized words and terms used in this Grant Agreement and not defined in this Grant Agreement (including, without limitation, in the Recitals above) shall have the meanings ascribed thereto in the DDA. Other capitalized words and terms used in this Grant Agreement shall have the meanings ascribed thereto where first used or as set forth in this Section 1.1. Capitalized terms used in an exhibit attached hereto and not defined therein shall also have the meanings set forth in this Section 1.1. "CHW Loan Note" means the promissory note to be made by Developer to evidence the CHW Loan. "DDA" shall mean that certain Disposition and Development Agreement, dated as of June 21, 2011, by and between CDC and Developer, as such document may be amended and implemented by the parties thereto and as assigned, with respect to Phase II, by Phase I Developer to Developer. "Grant for Phase II" has the meaning set forth in Section 5.1 of this Grant Agreement. 1.2 Singular and Plural Terms. Any defined term used in the plural in this Grant Agreement shall refer to all members of the relevant class and any defined term used in the singular shall refer to any number of the members of the relevant class. 1.3 Accounting Principles. Any accounting term used and not specifically defined in this Grant Agreement shall be construed in conformity with, and all financial data required to be submitted under this Grant Agreement shall be prepared in conformity with, generally accepted accounting principles applied on a consistent basis or in accordance with such other principles or methods as are reasonably acceptable to Successor Agency. 2 Paradise Creek TOD Phase II Grant Agreement Final Attachment No. 2 Clean Rev. 8.17.2015 1.4 References and Other Terms. References herein to Articles, Sections and Exhibits shall be construed as references to this Grant Agreement unless a different document is named. References to subparagraphs shall be construed as references to the same Section in which the reference appears. The terms "including" and "include" mean "including (include) without limitation". 1.5 Exhibits Incorporated. All attachments to this Grant Agreement, as now existing and as the same may from time to time be modified, are incorporated herein by this reference. 2. PARTIES 2.1 Successor Agency. Successor Agency is the Successor Agency of the CDC and any successor to its rights, powers and responsibilities. The principal offices of Successor Agency are located at 1243 National City Boulevard, National City, California 91950. 2.2 CHW. CHW is Community HousingWorks, a California nonprofit, public benefit corporation. The principal offices of CHW are located at 2815 Camino del Rio South, Suite 350, Suite 550, San Diego, California, 92108. 3. INTENTIONALLY OMITTED 4. SUCCESSOR AGENCY RIGHT TO TERMINATE If the DDA terminates prior to the Close of Escrow for Phase II, then Successor Agency, in addition to any and all other rights it may have to terminate this Grant Agreement, shall have the right to terminate this Grant Agreement by notice to CHW. 5. GRANT 5.1 Amount and Purpose. Subject to the terms and conditions of this Grant Agreement, Successor Agency agrees to make a grant to CHW for Phase II (the "Grant for Phase II") in the amount of Fourteen Million Nine Hundred Nine Thousand Dollars ($14,909,000) to be used for the sole purpose of CHW making the CHW Loan for Phase II to Developer. Uses of the proceeds of the CHW Loan by Developer shall be limited to costs of construction of capital improvements with a projected useful life of at least 30 years, including, without limitation, predevelopment and other soft costs directly associated with such capital improvements, as permitted pursuant to the documents governing the Bonds (collectively, "Permissible Uses"). Notwithstanding anything herein to the contrary, the Successor Agency hereby acknowledges and agrees that the costs listed on the Budget for Grant Agreement attached hereto as Exhibit A constitute Permissible Uses hereunder. The CHW Loan Agreement (as defined below) shall obligate Developer, in its capacity as Borrower, to use the proceeds of the CHW Loan only for Permissible Uses as defined herein. 5.2 Conditions to Initial Disbursement of Grant for Phase II. Successor Agency's obligation to make and disburse Nine Million Two Hundred Thirty Two Thousand Three Hundred Seventy Five Dollars ($9,232,375)) of the Grant for Phase II (the "Initial Disbursement") shall be subject to satisfaction of the following conditions precedent: (a) Loan Agreement. CHW, as lender, and Developer, as borrower, enter into a loan agreement, approved by the Executive Director (including, without limitation, all 3 Paradise Creek TOD Phase II Grant Agreement Final Attachment No. 2 Clean Rev. 8.17.2015 underlying loan documents), pursuant to which CHW uses the Grant for Phase II proceeds for the purpose of making the CHW Loan to Developer on terms and conditions consistent with the DDA (the "CHW Loan Agreement"). At the time of the Initial Disbursement, until the Close of Escrow for Phase II, the CHW Loan shall be secured exclusively by the Work Product (as defined in CHW Loan Agreement), and neither CHW nor the Successor Agency shall have any additional security with respect to the CHW Loan other than the Work Product. Among other things, the CHW Loan Agreement shall provide that: (1) neither it, nor any of its accompanying documents (including, without limitation, the promissory note evidencing and/or the deed of trust that will, following the Close of Escrow for Phase II, secure the CHW Loan) may be amended, modified or rescinded without the prior written approval of the Executive Director, which approval shall not be unreasonably withheld, and the Successor Agency shall be named a third - party beneficiary of the same and (2) proceeds of the CHW Loan shall be used only for Permissible Uses. (b) No Default. No default by CHW under this Grant Agreement shall then exist, and no event shall then exist which, with the giving of notice or the passage of time or both, would constitute such a default by CHW and, if requested by the Executive Director, Successor Agency shall have received a certificate to that effect signed by CHW. 5.3 Conditions to Final Disbursement of Grant for Phase II. The remaining Five Million Six Hundred Seventy Six Thousand Six Hundred Twenty Five Dollars ($5,676,625) of the Grant for Phase II (the "Final Disbursement") shall be disbursed concurrently with the execution and delivery of this Grant Agreement, to an escrow account held by Old Republic Title Company ("Escrow Agent") pursuant to escrow instructions which are mutually acceptable to the Successor Agency and CHW. The Escrow Agent shall disburse upon satisfaction of the following conditions precedent: (a) Close of Escrow for Phase II. Escrow for Phase II must close concurrently. (b) Loan Agreement and Deed of Trust. The CHW Loan Agreement shall be in full force and effect and no default shall exist thereunder. CHW and Developer shall cause to be recorded a second priority deed of trust securing Developer's obligation to repay CHW Loan in the Official Records. (c) Disbursement Agreement. CHW, the Phase II Construction Lender and Successor Agency have entered into an agreement for disbursement of the Construction Amount of the Grant for Phase II substantially similar to the Construction Lender/Successor Agency Disbursement Agreement for Phase II and such agreement has been approved by Developer and the Tax Credit Partner for Phase II. (d) Insurance. Successor Agency has received satisfactory evidence that the insurance required pursuant to the Ground Lease for Phase II is in full force and effect. (e) Representations and Warranties. The representations of CHW contained in this Grant Agreement shall be correct in all material respects as of the Close of Escrow for Phase II as though made on and as of that date and, if requested by the Executive Director, Successor Agency shall have received a certificate to that effect signed by CHW. (f) No Default. No default by CHW under this Grant Agreement shall then exist, and no event shall then exist which, with the giving of notice or the passage of time 4 Paradise Creek TOD Phase II Grant Agreement Final Attachment No. 2 Clean Rev. 8.17.2015 or both, would constitute such a default by CHW and, if requested by the Executive Director, Successor Agency shall have received a certificate to that effect signed by CHW. (g) Use of Proceeds. Successor Agency has received a certification from the Developer certifying that (i) that the proceeds of the CHW Loan spent by Developer to date have been used only for Permissible Uses and (ii) unspent proceeds of the CHW Loan and proceeds of the Final Disbursement will be used only for Permissible Uses. 5.4 Disbursement of Grant for Phase II. The Initial Disbursement of the Grant for Phase II shall, subject to the terms and conditions of this Grant Agreement, be delivered directly to CHW and shall be disbursed therefrom on or about the date hereof to pay predevelopment expenses and certain site improvements in accordance with the Final Project Budget for Phase II. Successor Agency acknowledges and agrees that, should Close of the Phase II Escrow and/or the completion of Phase II of the Project not occur, Successor Agency, as fee owner of the Site, will have nonetheless received a benefit based on the predevelopment work and site improvements funded by the Initial Disbursement. The Final Disbursement of the Grant for Phase II shall, subject to the terms and conditions of this Grant Agreement, be deposited into the Phase II Escrow in time to permit the close thereof and shall be disbursed therefrom at Close of the Phase II Escrow (a) to pay closing costs and expenses shown on the dosing statement for the Phase II Escrow, and (b) to the Construction Lender for Phase II for deposit into a construction account from which disbursements shall be made periodically by the Construction Lender only to pay Phase II Project Costs in accordance with the Final Project Budget for Phase II. 5.5 Return of Grant for Phase II. Notwithstanding anything herein to the contrary, if construction of Phase II of the Project has not commenced on or before December 31, 2018 (as the same may be extended with the consent of the Executive Director), to the extent any portion of the Grant for Phase II has (a) not yet been disbursed to Developer or (b) disbursed to Developer and repaid pursuant to the terms of the CHW Loan Agreement, such undisbursed or repaid funds shall be returned from CHW to the Successor Agency. 5.6 DOF and Oversight Board Approval. The parties hereto acknowledge and agree that this Grant Agreement is subject to review and approval by the Oversight Board to the Successor Agency and the California Department of Finance and that, notwithstanding anything herein to the contrary, the Grant Agreement shall not be deemed effective until the Successor Agency has obtained such approval from the Oversight Board to the Successor Agency and the California Department of Finance. Therefore, the Successor Agency and CHW acknowledge and agree that, upon receipt of such approvals, the Grant for Phase II is an unconditional and irrevocable obligation of the Successor Agency and cannot be recalled by the Successor Agency due to any claim or demand from any governmental agency having jurisdiction over the Site, including, without limitation, the California Department of Finance, pursuant to its authority under Section 34179.6(h)(1)(B) of the California Health and Safety Code, or any holder of the Bonds (a "Demand for Grant Recovery"). Without limiting the generality of the foregoing, (i) the Successor Agency hereby agrees to indemnify, defend, protect and hold harmless CHW, its officers, directors, partners, members, affiliates, employees, agents, successors and assigns from and against any loss, cost, damage, cause of action, suit, penalty, fine, liability or expense, including, without limitation, attorney's fees, costs of suit or court costs incurred as a result of a Demand for Grant Recovery which is proximately caused by any material misrepresentation, gross negligence or fraud by the Successor Agency, whether or not such Demand for Grant Recovery is successful; and (ii) CHW hereby agrees to indemnify, defend, protect and hold harmless the Successor Agency, its officers, directors, partners, 5 Paradise Creek TOD Phase II Grant Agreement Final Attachment No. 2 Clean Rev. 8.17.2015 members, affiliates, employees, agents, successors and assigns from and against any Toss, cost, damage, cause of action, suit, penalty, fine, liability or expense, including, without limitation, attorneys' fees, costs of suit or court costs incurred as a result of a Demand for Grant Recovery which is proximately caused by any material misrepresentation, gross negligence or fraud by CHW, whether or not such Demand for Grant Recovery is successful. 6. PROGRAM INCOME 6.1 Defined. For the purposes of this Grant Agreement, "Program Income" shall mean all funds collected by CHW in repayment of the CHW Loan. 6.2 Use of Program Income. CHW shall use the Program Income to fund social and educational programming and activities for the benefit of the Project, its residents and the residents of the community of which the Project is a part (the "Paradise Creek -Related Programs and Activities"). Such programs and activities could include, without limitation: (a) resident and/or community -based cleanup efforts in and around the Project, including, without limitation, in and around the Paradise Creek Parcel and/or Paradise Creek Education Park; provided, however, such efforts may not include routine and/or regular maintenance of such property; (b) youth environmental education programming; (c) job corps -type training programs; (d) as matching funds for individual development accounts to assist people of modest means save for the purchase of a lifelong asset, such as a home; or to obtain education and/or job training; and education and coaching programs related to personal finance and credit management; (e) to make first-time homebuyer down payment loans and related homebuyer education and coaching programs; and/or (f) other activities as approved in advance by the Executive Director. 6.3 Submission of Annual Plan. Not later than thirty (30) days after first receipt by CHW of Program Income and every year thereafter for which CHW receives any Program Income, CHW shall submit to the Executive Director for approval (which approval shall not be unreasonably withheld) a plan and budget for the Paradise Creek -Related Programs and Activities that CHW proposes to fund and operate over the ensuing one (1)-year period (the "Annual Plan"). That notwithstanding, the Executive Director shall be under no obligation to allow use of the Program Income to fund programs and activities otherwise obligated to be provided by the Tenant under the Ground Lease for Phase II. Additionally, if the Program Income received by CHW for any year or succession of years is insufficient to fund and operate any meaningful Paradise Creek -Related Programs and Activities for the ensuing year, CHW may, with the written consent of the Executive Director (which consent shall not be unreasonably withheld) accumulate funds until sufficient by holding such funds (unless de minimis) in an interest -bearing account, with such interest to become Program Income. 6 Paradise Creek TOD Phase II Grant Agreement Final Attachment No. 2 Clean Rev. 8.17.2015 6.4 Implementation of Annual Plan. Promptly after approval of any Annual Plan, CHW shall implement that Annual Plan. 6.5 Acknowledgment of City. Any and all Paradise Creek -Related Programs and Activates printed and/or digital materials, including signage, shall acknowledge, in a manner reasonably satisfactory to the Executive Director, the contribution of the City of National City to the funding of the subject program and/or activity. 6.6 Enforcement of CHW Loan Note. In order to reasonably maximize Program Income, CHW shall reasonably enforce payment of the CHW Loan Note. 7. GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS 7.1 CHW's Formation, Qualification and Compliance. CHW (a) is validly existing and in good standing under the laws of the State of California, (b) has all requisite authority to conduct its business, and has all requisite authority to execute and perform its obligations under this Grant Agreement. 7.2 Litigation. CHW represents and warrants that there are no material actions, lawsuits or proceedings pending or, to the best of CHW's knowledge, threatened against or affecting CHW, the adverse outcome of which could have a material adverse effect on CHW's ability to perform its obligations under this Grant Agreement. 8. RETENTION OF RECORDS CHW shall maintain all books, documents, papers, accounting records, and other evidence pertaining to this Grant Agreement and shall make such materials available at its office at all reasonable times during the term of this Grant Agreement and for three (3) years from the date of Close of Escrow for Phase II for inspection by Successor Agency and for furnishing of copies to Successor Agency, if requested. 9. INDEPENDENT CONTRACTOR Both parties hereto in the performance of this Grant Agreement will be acting in an independent capacity and not as agents, employees, partners or joint venturers with one another. Neither CHW nor CHW's employees are employees of Successor Agency and are not entitled to any of the rights, benefits, or privileges of Successor Agency's employees, including but not limited to retirement, medical, unemployment, or workers' compensation insurance. 10. CONTROL Neither Successor Agency nor its officers, agents or employees shall have any control over the conduct of CHW or any of CHW's employees except as herein set forth, and CHW expressly agrees not to represent that CHW or CHW's agents, servants, or employees are in any manner agents, servants or employees of Successor Agency, it being understood that CHW, its agents, servants, and employees are as to Successor Agency wholly independent contractors and that CHW's obligations to Successor Agency are solely such as are prescribed by this Grant Agreement. 7 Paradise Creek TOD Phase II Grant Agreement Final Attachment No. 2 Clean Rev. 8.17.2015 11. COMPLIANCE WITH APPLICABLE LAW CHW, in the performance of this Grant Agreement, shall comply with all applicable State and Federal statutes and regulations, and all applicable ordinances of the City of National City, whether now in force or subsequently enacted. CHW, and each of its subcontractors, shall obtain and maintain a current City of National City business license prior to and during performance of any work pursuant to this Grant Agreement. 12. NON-DISCRIMINATION PROVISIONS In the performance of this Agreement, CHW shall: (a) not discriminate against any employee or applicant for employment because of age, race, color, ancestry, religion, sex, sexual orientation, marital status, national origin, physical handicap, or medical condition; and (b) take positive action to insure that applicants are employed without regard to their age, race, color, ancestry, religion, sex, sexual orientation, marital status, national origin, physical handicap, or medical condition. Such action shall include but not be limited to the following: employment, upgrading, demotion, transfer, recruitment or recruitment advertising, layoff or termination, rates of pay or other forms of compensation, and selection for training, including apprenticeship. 13. INDEMNIFICATION AND HOLD HARMLESS CHW agrees to defend, indemnify, and hold harmless Successor Agency and the City of National City, and their officers and employees, against and from any and all liability, loss, damages to property, injuries to, or death of any person or persons, and all claims, demands, suits, actions, proceedings, reasonable attorneys' fees, and• defense costs, of any kind or nature, including workers' compensation claims, of or by anyone whomsoever, resulting from or arising out of CHW's negligent performance of this Grant Agreement. 14. INSURANCE CHW shall cause the Developer to purchase and maintain, and to require its contractors, if any, to purchase and maintain, until issuance of the Certificate of Completion for Phase II, the following insurance policies: A. Automobile insurance covering all bodily injury and property damage incurred during the performance of this Grant Agreement, with a minimum coverage of $1,000,000 combined single limit per accident. Such automobile insurance shall include owned, non -owned, and hired vehicles ("any auto"). B. Commercial general liability insurance, with minimum limits of $2,000,000 per occurrence $4,000,000 aggregate, covering all bodily injury and property damage arising out of its operations under this Grant Agreement. C. Workers' compensation insurance in an amount sufficient to meet statutory requirements covering all of CHW employees and employers' liability insurance with limits of at least $1,000,000 per accident. In addition, the policy shall be endorsed with a waiver of subrogation in favor of Successor Agency. Said endorsement shall be provided prior to commencement of work under this Grant Agreement. 8 Paradise Creek TOD Phase II Grant Agreement Final Attachment No. 2 Clean Rev. 8.17.2015 D. The aforesaid policies shall constitute primary insurance as to Successor Agency, its officers, employees, and volunteers, so that any other policies held by Successor Agency shall not contribute to any Toss under said insurance. Said policies shall provide for thirty (30) days prior written notice to Successor Agency of cancellation or material change. E. Said policies, except for the professional liability and workers' compensation policies, shall name Successor Agency, CDC and the City of National City, and their officers, agents and employees as additional insureds, and separate additional insured endorsements shall be provided. F. If required insurance coverage is provided on a "claims made" rather than "occurrence" form, CHW shall cause Developer to maintain such insurance coverage for three years after expiration of the term (and any extensions) of this Grant Agreement. In addition, the "retro" date must be on or before the date of this Grant Agreement. G. Any aggregate insurance limits must apply solely to this Grant Agreement. H. Insurance shall be written with only California admitted companies which hold a current policy holder's alphabetic and financial size category rating of not less than A Vill according to the current Best's Key Rating Guide, or a company equal financial stability that is approved by Successor Agency's Risk Manager. In the event coverage is provided by non -admitted "surplus lines" carriers, they must be included on the most recent California List of Eligible Surplus Lines Insurers (LESLI list) and otherwise meet rating requirements. This Grant Agreement shall not take effect until certificate(s) or other sufficient proof that these insurance provisions have been complied with, are filed with and approved by Successor Agency's Risk Manager. If CHW does not cause Developer to keep all of such insurance policies in full force and effect at all times required under this Grant Agreement, Successor Agency may elect to treat the failure to maintain the requisite insurance as a breach of this Grant Agreement and, subject to the right to notice and cure set forth in Section 17.A, terminate this Grant Agreement as provided herein. J. All deductibles and self -insured retentions in excess of $10,000 must be disclosed to and approved by Successor Agency. 15. LEGAL FEES If any party brings a suit or action against the other party arising from any breach of any of the covenants or agreements or any inaccuracies in any of the representations and warranties on the part of the other party arising out of this Grant Agreement, then in that event, the prevailing party in such action or dispute, whether by final judgment or out -of -court settlement, shall be entitled to have and recover of and from the other party all reasonable costs and expenses of suit, including reasonable attorneys' fees. For purposes of determining who is to be considered the prevailing party, it is stipulated that attorney's fees incurred in the prosecution or defense of the action or suit shall not be considered in determining the amount of the judgment or award. 9 Paradise Creek TOD Phase II Grant Agreement Final Attachment No. 2 Clean Rev. 8.17.2015 16. MEDIATION/ARBITRATION If a dispute arises out of or relates to this Grant Agreement, or the breach thereof, the parties agree first to try, in good faith, to settle the dispute by mediation in San Diego, California, in accordance with the Commercial Mediation Rules of the American Arbitration Association (the "AAA") before resorting to arbitration. The costs of mediation shall be borne equally by the parties. Any controversy or claim arising out of, or relating to, this Grant Agreement, or breach thereof, which is not resolved by mediation shall be settled by arbitration in San Diego, California, in accordance with the Commercial Arbitration Rules of the AAA then existing. Any award rendered shall be final and conclusive upon the parties, and a judgment thereon may be entered in any court having jurisdiction over the subject matter of the controversy. The expenses of the arbitration shall be borne equally by the parties to the arbitration, provided that each party shall pay for and bear the costs of its own experts, evidence and attorneys' fees, except that the arbitrator may assess such expenses or any part thereof against a specified party as part of the arbitration award. 17. TERMINATION A. This Grant Agreement may be terminated by Successor Agency for cause in the event of a material breach of this Grant Agreement and failure by CHW to cure such breach within thirty (30) days after the giving of notice by Successor Agency. If, however, by its nature the failure cannot reasonably be cured within thirty (30) days, CHW may have such longer period of time as is reasonably necessary to cure the failure, provided, however, that CHW commence said cure within said thirty (30)-day period, and thereafter diligently prosecute said cure to completion within one hundred eighty (180) days. B. Termination with cause shall be effected by delivery of written Notice of Termination to CHW as provided for herein. C. Upon termination of this Grant Agreement pursuant to the terms hereof, Successor Agency shall have no obligation to disburse any outstanding portions of the Grant for Phase II. 18. NOTICES All notices or other communications required or permitted hereunder shall be in writing, and shall be personally delivered; or sent by overnight mail (Federal Express or the like); or sent by registered or certified mail, postage prepaid, return receipt requested; or sent by ordinary mail, postage prepaid; or telegraphed or cabled; or delivered or sent by telex, telecopy, facsimile or fax; and shall be deemed received upon the earlier of (i) if personally delivered, the date of delivery to the address of the person to receive such notice, (ii) if sent by overnight mail, the business day following its deposit in such overnight mail facility, (iii) if mailed by registered, certified or ordinary mail, five (5) days (ten (10) days if the address is outside the State of California) after the date of deposit in a post office, mailbox, mail chute, or other like facility regularly maintained by the United States Postal Service, (iv) if given by telegraph or cable, when delivered to the telegraph company with charges prepaid, or (v) if given by telex, telecopy, facsimile or fax, when sent. Any notice, request, demand, direction or other communication delivered or sent as specified above shall be directed to the following persons: To the Successor Agency: Successor Agency to the Community Development Commission as the National City Redevelopment 10 Paradise Creek TOD Phase II Grant Agreement Final To CHW: Attachment No. 2 Clean Rev. 8.17.2015 Agency 1243 National City Blvd. National City, California 91950 Attn: Executive Director Community HousingWorks 2815 Camino del Rio South, Suite 350 San Diego, California 92108 Attn: Anne B. Wilson, Sr. VP of Housing & Real Estate Development Notice of change of address shall be given by written notice in the manner specified in this Section. Rejection or other refusal to accept or the inability to deliver because of changed address of which no notice was given shall be deemed to constitute receipt of the notice, demand, request or communication sent. Any notice, request, demand, direction or other communication sent by cable, telex, telecopy, facsimile or fax must be confirmed within forty-eight (48) hours by letter mailed or delivered as specified in this Section. 19. DEPARTMENT OF FINANCE APPROVAL The parties hereto acknowledge and agree that this Grant Agreement is subject to review and approval by the Oversight Board to the Successor Agency and the California Department of Finance and that, notwithstanding anything herein to the contrary, the Grant Agreement shall not be deemed effective until the Successor Agency has obtained such approval from the Oversight Board to the Successor Agency and the California Department of Finance. 20. MISCELLANEOUS PROVISIONS A. Computation of Time Periods. If any date or time period provided for in this Grant Agreement is or ends on a Saturday, Sunday or federal, state or legal holiday, then such date shall automatically be extended until 5:00 p.m. Pacific Time of the next day which is not a Saturday, Sunday or federal, state or legal holiday. B. Counterparts. This Grant Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which, together, shall constitute but one and the same instrument. C. Captions. Any captions to, or headings of, the sections or subsections of this Grant Agreement are solely for the convenience of the parties hereto, are not a part of this Grant Agreement, and shall not be used for the interpretation or determination of the validity of this Grant Agreement or any provision hereof D. No Obligations to Third Parties. Except as otherwise expressly provided herein, the execution and delivery of this Grant Agreement shall not be deemed to confer any rights upon, or obligate any of the parties hereto, to any person or entity other than the parties hereto. E. Exhibits and Schedules. The Exhibits and Schedules attached hereto are hereby incorporated herein by this reference for all purposes. 11 Paradise Creek TOD Phase II Grant Agreement Final Attachment No. 2 Clean Rev. 8.17.2015 F. Amendment to this Grant Agreement. The terms of this Grant Agreement may not be modified or amended except by an instrument in writing executed by each of the parties hereto. G. Waiver. The waiver or failure to enforce any provision of this Grant Agreement shall not operate as a waiver of any future breach of any such provision or any other provision hereof. H. Applicable Law. This Grant Agreement shall be governed by and construed in accordance with the laws of the State of California. Entire Agreement. This Grant Agreement supersedes any prior agreements, negotiations and communications, oral or written, and contains the entire agreement between the parties as to the subject matter hereof. No subsequent agreement, representation, or promise made by either party hereto, or by or to an employee, officer, agent or representative of any party hereto shall be of any effect unless it is in writing and executed by the party to be bound thereby. J. Successors and Assigns. This Grant Agreement shall be binding upon and shall inure to the benefit of the successors and assigns of the parties hereto. K. Construction. The parties acknowledge and agree that (i) each party is of equal bargaining strength, (ii) each party has actively participated in the drafting, preparation and negotiation of this Grant Agreement, (iii) each such party has consulted with or has had the opportunity to consult with its own, independent counsel and such other professional advisors as such party has deemed appropriate, relative to any and all matters contemplated under this Grant Agreement, (iv) each party and such party's counsel and advisors have reviewed this Grant Agreement, (v) each party has agreed to enter into this Grant Agreement following such review and the rendering of such advice, and (vi) any rule or construction to the effect that ambiguities are to be resolved against the drafting party shall not apply in the interpretation of this Grant Agreement, or any portions hereof, or any amendments hereto. (signatures on following page) 12 Paradise Creek TOD Phase II Grant Agreement Final IN WITNESS WHEREOF, the parties hereto have executed this Grant Agreement on the date and year first above written. APPROVED AS TO FORM: Christensen & Spath LLP, Successor Agency Special Counsel By: COMMUNITY HOUSINGWORKS, a California nonprofit, public benefit corporation By: Name: Its: SUCCESSOR AGENCY TO THE COMMUNITY DEVELOPMENT COMMISSION AS THE NATIONAL CITY REDEVELOPMENT AGENCY By: Walter F. Spath III, Esq., Partner S-1 Name: Ron Morrison Its: Chairman Paradise Creek TOD Phase II Grant Agreement Final • EXHIBIT A Budget for Grant Agreement 1 Park Remediation 2 Park Improvements 3 GC Site Preparation including Site Remediation 4 Total Predevelopment Scope of Work Grand Total Predevelopment Scope of Work (Detail) 1 Architecture 2 Landscape Architecture 3 Civil Engineering 4 Environmental Engineering 5 Geotechnical Engineering 6 ( Title 24/MEP Peer Review 7 Utility Consultant 8 Sustainability g Other Architects & Engineers $3,000,000 $1,800,000 $2,289,284 $2,143,091 $9,232,375 $433,185 $90,000 $250,000 $72,000 10 Blueprinting / Printing / Copying 11 I Appraisals & Market Studies 12 Interior Design Coordinator 13 Zoning Approvals 14 TCAC Application Fee 15 TCAC Performance Deposit Grand Total Exhibit "A" $150,000 $55,000 $50,000 $20,000 $60,000 $11,500 $8,000 $8,000 $873,406 $2,000 $60,000 $2,143,091 Page 1 of 1 Paradise Creek TOD Phase II Grant Agreement Final