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HomeMy WebLinkAbout2016 CON CDC HA - Community Housing Works - Grant AgreementGRANT AGREEMENT [Transit -Oriented Infill Affordable Housing and Paradise Creek Enhancement Project] (City AHSC Grant for Phase II) THIS GRANT AGREEMENT, dated as of November 1, 2016 for identification purposes only (the "Grant Agreement"), is made and entered into by and between the CITY OF NATIONAL CITY (the "City"), and COMMUNITY HOUSINGWORKS, a California nonprofit public benefit corporation ("CHW"), with reference to the following: RECITALS A. CHW is a member and the manager of CHW Paradise Creek II Development Co., LLC, a California limited liability company (the "Managing General Partner"), the managing general partner of Paradise Creek II Housing Partners, L.P., a California limited partnership (the "Partnership"). B. The Partnership owns a leasehold interest in approximately 1.99 acres of land on Hoover Avenue, in the City of National City, County of San Diego, State of California, more particularly described in Exhibit A attached hereto (the "Property"). C. The Partnership intends to develop on the Property a 92-unit affordable rental housing project for person and families of very low and low-income (the "Phase II Project"). D. The State of California Department of Housing and Community Development ("HCD") has awarded grant funds from the Affordable Housing and Sustainable Communities Program ("AHSC") to The Related Companies of California, LLC, a California limited liability company ("TRCC"), an affiliate of the Partnership, and the City in an amount equal to $5,480,271 for use in connection with the Phase II Project (the "HCD AHSC Grant"). E. The HCD AHSC Grant is made pursuant to the terms of (i) that certain Standard Agreement dated as of November , 2016, and executed by and among HCD, TRCC and the City (the "AHSC Standard Agreement"), (ii) that certain Disbursement Agreement dated for reference purposes as of November 1, 2016, by and among HCD, TRCC and the City (the "AHSC Disbursement Agreement"), and (iii) that certain Declaration of Restrictive Covenants for the Development and Operation of Affordable Housing dated November 1, 2016 for reference purposes only, by and among the Partnership and HCD, (the "AHSC Regulatory Agreement," and collectively with the AHSC Standard Agreement and the AHSC Disbursement Agreement, the "AHSC Documents"). F. The City has been designated as the sole payee under the AHSC Disbursement Agreement with respect to the HCD AHSC Grant and HCD has approved such designation. G. The proceeds of the HCD AHSC Grant will be received by the City and thereafter a portion of the HCD AHSC Grant in an amount equal to $4,550,000 will be granted by the City during construction to CHW. CHW will thereafter contribute the funds to the Managing General Partner, which will promptly contribute such funds to the Partnership. NOW, THEREFORE, the City and CHW agree as follows: 1 50144442.3 National City Phase II AHSC Grant Agreement 1. DEFINITIONS AND INTERPRETATION 1.1 Defined Terms. Capitalized words and terms used in this Grant Agreement shall have the meanings ascribed thereto where first used. 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 the City. 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 The City. The City is the City of National City, a California municipal corporation. The principal offices of the City 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. GRANT 3.1 Amount and Purpose. Subject to the terms and conditions of this Grant Agreement, the City agrees to make a grant to CHW for Phase II (the "City AHSC Grant for Phase II") in the aggregate amount of Four Million Four Hundred Fifty Five Thousand and 00/100 Dollars ($4,550,000) to be used by CHW for the sole purpose of making capital contributions to the Managing General Partner (the "CHW Capital Contributions"), which the Managing General Partner shall use solely for the purpose of making capital contributions to the Partnership (the "MGP Capital Contributions"). The Partnership shall use the proceeds of the MGP Capital Contributions solely and exclusively for approved housing -related infrastructure costs in connection with the development of the Project as set forth in the AHSC Documents. The proceeds of the City AHSC Grant for Phase II (the "Grant Proceeds") shall be disbursed in accordance with Section 3.2 hereof. 2 50144442.3 National City Phase II AHSC Grant Agreement 3.2 Disbursement of the City AHSC Grant for Phase II. The City shall disburse Grant Proceeds to CHW, from time to time, within five (5) business days of receipt of HCD AHSC Grant funds by the City from HCD. 4. GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS 4.1 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. 4.2 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. 5. 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 for three (3) years from the date of this Agreement for inspection by the City and for furnishing of copies to the City, if requested. 6. 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 the City and are not entitled to any of the rights, benefits, or privileges of the City's employees, including but not limited to retirement, medical, unemployment, or workers' compensation insurance. 7. CONTROL Neither the City 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 the City, it being understood that CHW, its agents, servants, and employees are as to the City wholly independent contractors and that CHW's obligations to the City are solely such as are prescribed by this Grant Agreement. 8. 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. 3 50144442.3 National City Phase II AHSC Grant Agreement 9. NON-DISCRIMINATION PROVISIONS In the performance of this Grant 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. 10. INDEMNIFICATION AND HOLD HARMLESS CHW agrees to defend, indemnify, and hold harmless the City, and its 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. 11. 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. 12. 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. 4 50144442.3 National City Phase II AHSC Grant Agreement 13. TERMINATION A. This Grant Agreement may be terminated by the City 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 the City. 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, the City shall have no obligation to disburse any outstanding portions of the Grant for Phase II. 14. 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 City: To CHW: With a copy to: City of National City 1243 National City Blvd. National City, California 91950 Attn: City Manager Community HousingWorks 2815 Camino del Rio South, Suite 350 San Diego, California 92108 Attn: Anne B. Wilson, Sr. VP of Housing & Real Estate Development Paradise Creek II Housing Partners, L.P. c/o The Related Companies of California 18201 Von Karman Avenue, Suite 900 Irvine, California 92612 Attn: Frank Cardone 5 50144442.3 National City Phase II AHSC Grant Agreement With a copy to: Bocarsly Emden Cowan Esmail & Arndt LLP 633 W. 5th St., 64th FI Los Angeles, CA 90071 Attn: Lance Bocarsly 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. 15. 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. 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, 6 50144442.3 National City Phase II AHSC Grant 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) 7 50144442.3 National City Phase II AHSC Grant Agreement 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, Special Counsel By: COMMUNITY HOUSINGWORKS a Californianonprofit � fit public (enefit poration Anne B. Wilson Senior Vice President CITY OF NATIONAL CITY, a California municipal corporation By: Walter F. Spath III, Esq., Partner Leslie Deese City Manager 50144442 National City Phase II AHSC Grant Agreement 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, Special Counsel By: alter F. pa h III, Esq., Partner COMMUNITY HOUSINGWORKS, a California nonprofit public benefit corporation By: Anne B. Wilson Senior Vice President CITY OF NATIONAL CITY, a California municipal corporation By: Leslie Deese City Manager 50144442 National City Phase II AHSC Grant Agreement Exhibit A Legal Description (attached) A-1 50144442 National City Phase II AHSC Grant Agreement