HomeMy WebLinkAbout2022 CON D Avenue Housing Associates - Unsecured Environmental Indemnity Agreement - Kimball HighlandsUNSECURED ENVIRONMENTAL INDEMNITY GREEMENT
(Kirnball Highlands)
THIS UNSECURED ENVIRONMENTAL INDEMNITY AGREEMENT
("Indemnity") is dated as of the day of byand between peen D Avenue �r e Housing
Associates, L.P., a California limited partnership("Indemnitor"), to and for the benefit of the
Community Development Commission -Housing Authority of the City of National City
("Lender"), its successors and assigns and, to the extent not otherwise referenced, the Indemnified
Parties (as hereinafter defined.
RECITALS
A. Lender has agreed to make two loans to Indemnitor as described in: i that certain
Promissory Note (Kirnball Highlands - CDC -HA Loan) of even date herewith in the original
("Commission ��
principal amount of 10,4 ,000.00 Loan) made by Indemnitor in favor of the
Lender; and (ii) that certain Promissory Note (Kimball Highlands - Capitalized Ground Rent of
even date herewith in the original principal amount of ,000,000.00 ("Capitalized Ground Rent
Loan") made by Indemnitor in favor of the Lender. All capitalized terms used but not defined
herein have the definitions set forth in that certain Disposition and Development Agreement
(Kirnball
Highlands Master Plan) dated as of October 20, 2020, among the Lender, Centro De
Salud De La Comunidad De San Ysidro, Inc., dba San Ysidro Health, and Community
HousingW r• s, a California nonprofit public benefit corporation. The Commission Loan and.
Capitalized Ground Rent Loan are secured b_ , among other things, a Deed ofTrust andSecurity
a
Agreement executed by Indemnitor in favor* of Lender. The Deed of Trust encumbers that certain
real property described on Exhibit A attached hereto (such propertyalongwith anyother property
ert
p p"
encumbered by the Deed of Trust, now or at any time in the future, shall be referred to herein as
the "Property").
B. The execution and delivery of this Indemnity by the Indemnitor* to the Lender is a
condition to Lender making the Commission Loan and Capitalized Ground Rent Loan.Lender i
P is
making the Commission Loan and Capitalized Ground Rent Loan in reliance upon this Indemnity.
C. This Indemnity{ is unsecured and is separate from the security and other collateral
being delivered by Indemnitor in connection with the making of the Commission Loan and
Capitalized Ground Rent Loan.
AGREEMENT
NOW, , THEREFORE, in consideration of the foregoing and of Lender making the
Commission Loan and Capitalized Ground. Rent Loan, and other valuable consideration, the
receipt of which is hereby acknowledged, Indemnitor agrees as follows:
1. lndeznn it .
(a) Subject to Sections 2, 3 and 4 below, Indemnitor hereby agrees to defend, protect,
indemnify and hold harmless Lender, Lender's affiliates, directors, officers, shareholders, agents
1
and employees, and Lender's participant, successors and assigns specified in Section 4 hereof
(hereinafter, collectively, the "Indemnified Parties"), from and against, and shall reimburse the
Indemnified Parties for, any and all actual out-of-pocket cost i cludin , without limitation,
attorneys' fees, expenses and court costs), expense or loss arising from any claim, liability,
damage, injunctive relief, injuryto person, property or natural resources, fine, penalty,action, and
cause of action (collectively, "Costs and Liabilities"), incurred by or asserted against ally
Indemnified Party and arising directly or indirectly, in whole or in part, out of the release
discharge, deposit or presence, or alleged or suspected release, discharge, deposit or presence,
any Hazardous Materials at, oil, within, under, about or from the Property, or in or -adjacent to any
part of the Property, or in the soil, groundwater or soil vapor on or under the Property, or elsewhere
in connection with the transportation of rdous Materials to or from the Property in violation
of any Hazardous Materials Laws, whether or not known to Tnde nitor or Indemnified Parties,
whether foreseeable or unforeseeable, regardless of the ource of such release., discharge, deposit
or presence or, except as expressly provided to the contrary in Sections 2 and 4 hereof, regardless
of when such release, discharge, deposit or presence occurred or is discovered. Without limiting
the generality of the foregoing indemnity, such Costs and Liabilities shall include, without
limitation, all actual out-of-pocket costs incurred by Indemnified ed Parties: .in connection with 0
determining .whether the Property is in compliance with this Indemnity and with all applicable
Hazardous ardous Materials Laws or the amount of money required to remediate any environmental
contamination, and causing the Property to be or become in compliance, with all applicable
Hazardous Materials Laws, .i any removal al or remediation of any kind and disposal of any
Hazardous Materials present at, on, under or within the Property or released from the Property to
the extent required by applicable Hazardous Materials Laws in effect at the time of such removal,
remediation or disposal, and ili repair of any damage to the Property or any other caused
property.
by any removal, remediation or disposal.
(b) Upon demand by any Indemnified Party, Idemnit r shall defend any investigation,
action or proceeding in connection with any claim o • liability, or alleged claim or liability, that
would, if determined adversely to such Indemnified Party, be covered by the foregoing
indemnification cationn provisions, such defense to be at Inde nitor's sole cost and expense. and by
counsel reasonably approved by such Indemnified Party, which counsel may, without limiting the
rights of an Indemnified Party pursuant to the next succeeding sentence of this Section 1(b), also
represent !nde nitor in such investigation, action or proceeding. If any ndet i red Party
determines reasonably and in good faith that its defense by Indemnitor is being conducted in a
manner Which. is prejudicial to its interests, such Indemnified ed Party may elect to conduct its own
defense through counsel of its own choosing and at the expense of Indemnitor,
(c) As used herein, the term "Hazardous Materials" means and includes any
flammable, explosive, or radioactive materials or hazardous, toxic or dangerous wastes, substances
or related materials or any other chemicals, materials or substances, exposure to which is
prohibited, limited or regulated by any federal, state, county, regional or local authority or which,
even if not so regulated, may or could pose a hazard to the health and safety of the occupants of
the Property or of property adjacent to the Property, including, but not limited to, asbestos, PCBs,
petroleum products and byproducts, substances defined or listed as "hazardous substances" or
"toxic substances" or similarly identified in, pursuant to, or for purposes of, the California Solid
Waste Management, Resource Recovery and Recycling Act (California Government ent Code §66700
2
t e 1. , the Comprehensive Environ x ental Response, Compensation, and Liability Act, as
amended 2 .S.C. §960 1, et s . , the Hazardous Materials Transportation Act 9 U.S.C.
1 01, et seq.), the Resource Conservation and Recovery act 2U.S.C. §6901, et seq.), Section
25117 or Section 25316 of the California Health & Safety Code; and any so-called "Sn erfun l"
or Super lien lair, or any other federal, state or local statute, law, ordinance, code, rule
regulation, order or decree regulating, relating to or imposing li bili y or standards of on luc
concerning any hazardous, toxic or dangerous waste, substance or material; or any substances or
mixture regulated under the Toxic Substance Control Act of 1976, as now or hereafter amended
(15 S.C. §260 .1 et . ; and. any "to.xic pollutant" under the Clean Water Act, as now or hereafter
amended U.S.C. §1251 et seq.); and any hazardous s air pollutant under the Clean Air Act, as
now or hereafter amended U.S.C. §7901 et .. Notwithstanding the above, the term
"Hazardous Materials" ." shall not include small amounts of chemicals cleaningagents and the like
commonly employed in routine residential apartment uses in a manner typical of occupants or
owners in other similar residential properties, provided thatuch substances are used in compliance
nce
with applicable laws. The term "Hazardous Materials Laws" means any federal, state or local law,
code, statute, ordinance, rule, regulation, rule of common law or guideline relating to Hazardous
Materials now or hereafter enacted or promulgated (collectively, and including, without limitation,
any such laws which require notice of the use, presence, storage, generation, disposal or release of
any Hazardous Materials to be provided to any party).
2. Time Limits on Claims. Notwithstanding the foregoing provisions:
(a) No claim shall be made hereunder by any Indemnified Party unless and until any
one of the following events shall have occurred: (i) repayment in full of the Commission Loan
and Capitalized Ground Rent Loan (as evidenced by the release and recon e ance oft e Deed of
Trust); or 11) vesting of title to the Property in . Lender or any Indemnified Party through judielal
or non -judicial foreclosure or acceptance of a deed in lieu thereof.
(b) Indemnitor shall not have any obligation under this .Indemnity to an Indemnified
Party with respect to any Costs and Liabilities that, prior to the first to occur of the events described
in Section 2 a i or (R) above: (I)were actually known to Lender; r1 were liquidated in amount,
or were otherwise readily det'ermi able in amount without undue delay; and (Hi) would have been
lawfully and properly includable as part of the secured indebtedness under the Deed of Trust in an
action for a deficiency judgment following a judieial foreclosure sale of the Property.
(c) If any Indemnified Party or any affiliate of any indemnified Party has acquired
ownership of the Property through foreclosure or deed in lieu of foreclosure, the obligations of
Indemnitor hereunder shall apply, without limitation, to all Costs and Liabilities that arise out of
or are attributable to, whether directly or indirectly, ownership of the Property or any part thereof
by any Indemnified or any such affiliate, or to the position of such Indemnified Party or such
affiliate as an owner in the chain of title to the Property or any part thereof.
(d) the Commission Loan and Capitalized Ground Rent Loan have been repaid in
full, whether by voluntary payment or by foreclosure or deed in lieu of foreclosure., the obligations
of Indemnitor hereunder shall continue to apply, without limitation, to all Costs and Liabilities that
arise out of or are attributable to, whether directly or indirectly, any claim or allegation against an
3
Indemnified Party relating to any act or omission of such Indemnified Party in respect of the
Coi mission Loan, Capitalized Ground Rent Loan or the Property, or in connection with any
exercise of such Indemnified Party's rights thereunder.
3. Acts of Indemnified Parties.
(a) Notwithstanding anything to the contrary herein, Indemnitor shall not be liable
hereunder to an Indemnified Party to the extent of that portion of any Costs and Liabilities which
Indemnitor establishes is attributable to the gross negligence or affirmative act of such Indemnified
Party, its agent or any successor in interest of an Indemnified Party at the Property which causes
(i) the release, discharge, deposit or presence, or alleged or suspected release, discharge, deposit
or presence of a Hazardous Material at the Property, or ii material aggravation of a then existing
Hazardous Material condition or occurrence at the Property, if and only if, in either such case
referred to in i or (ii) above, such act was i . violation of any Hazardous Materials Laws or was
carded out without reasonable care under the circumstances.
(b) In addition, Indemnitor- shall not be liable hereunder for that portion of any Costs
and Liabilities which Indemnitor establishes is attributable to the introduction and initial release
discharge or deposit, or alleged or suspected introduction, initial release, discharge or deposit of a
Hazardous Material at the Property by any party, other di -an Indemnitor or an affiliate of
Indemnitor, at any time after I den'mitor's ownership interest in the Property terminates.
Notwithstanding the foregoing, but subject to Sections 2 and 3(a) above and Section 4 below, the
liability of Indemnitor hereunder shall otherwise .retain in full force and effect after Lender or
such affiliate of Lender so acquires title to the Property,including without limitation with respect
to any Hazardous Materials which are discovered at the Property after the date Lender or such
affiliate of Lender acquires title but which were actually introduced to the Property prior to the
date of such acquisition.
. jndemnifiedParties. This Indemnity an.d I dem ito *'s obligations hereunder shall inure to
the benefit of and be enforceable only by (a) Lender, Lender's directors, officers, agents and
employees, (b) any person or entities to which any eider participates, assigns or sells all or any
interestf
portion ofits inthe Commission Loan or Capitalized Ground Rent Loan, or which
otherwise succeeds to the interest of Lender under the Deed of Trust, whether by purchase or
otherwise, and (c) any affiliate of Lender which acquires tale to the Property at a foreclosure sale
or by deed in lieu of foreclosure.
5. Uns_c_eured aos. The obligations of Indemnitor hereunder are unsecured. This
Indemnity is not intended to be, nor shall it be, secured by the Deed ofTrust or any other instrument
or agreement executed by Indemnitor or any other entity or person in favor of Lender or any
Indemnified Party relating to the Commission Loan or Capitalized Ground Rent Loan (except for
any guaranty) (such documents together with the Deed of Trust being referred to collectively
herein as the "Loan Documents"), The obligations of Indemnitor under this Indemnity are
independent of any indemnification or other obligations ofIndemnitor under the Loan Documents
with respect to any Hazardous .Materials, The rights and remedies of the Indemnified Parties under
this indemnity shall be in addition to any other rights and remedies of such Indemnified Parties
under the Loan Documents. In no event shall any provision of this Indemnity be deemed to be
waiver of or to be in lieu of any right or claim, including without limitation ny right of
contribution or other right of recovery, that any person entitled to enforce this Indemnity might
otherwise have against Indemnitor under any Hazardous Materials Laws. Any sums able
hereunder shall not be deemed to be based upon any diminution in or other impairment of the vaine
of any collateral held by Lender to secure the Commission Loan or Capitalized Ground Rent Loan.
6. Interest on Un said Amounts. Any amount claimed hereunder by an Indemnified e.d Party not
Paid by Indemnitor within thirty days after written demand made by such Indemnified Party
and. accompanied by a reasonable summary ry of the amounts claimed, shall bear interest at the rate
of ten percent 1 % per annum.
7. kimitations on Liabili . The liability of Indemnitor under this .Indemnity shall in no way
be limited or impaired by any amendment or modification of the provisions of any of the Loan
Documents; (b) excepts set forth in Sections 2, 3 and 4, any participation in or sale or assignment
of the Loan Documents or a.ny sale or transfer of all or pant of the Property; (c) the release of
Indemnitor or any person or entity from performance or observance n r of the agreements,
covenants, terms, or conditions contained in any of the Loan Documents by operation of law; and,
in any such case, whether with or without notice to Indemnitor n with or without consideration.
Except as provided in Sections 2, 3 and 4, Inder nitor•'s obligations hereunder shall in o way be
impaired, reduced or .released by reason of (i) an Indemnified P rt 's omission or delay in
exercising any right described herein or (ii) act or omission of an Indemnified Party in
connection with any notice, demand, warning, or claim regarding ioltions of codes, laws or
ordinances governing the Property..
8. Recourse Obliggiop, Notwithstanding anything to the contrary in. the Loan Documents,
Indemnitor shall be personally liable on a recourse basis for the obligations of Indemnitor set forth
herein.
. Successors ors and Assigns., This Indemnity shall be continuing, irrevocable and binding upon
each of the persons and entities comprising I clennitor and their respective heirs, successors, and
assigns.
10. Inconsistencies. In the event of any inconsistencies or conflicts between the terms of this
Indemnity and the terms of the other Loan Documents (including any exculpatory language
contained therein), the terms of this Indemnity shalt control.
11 Separate Causes of Action. A separate right of action hereunder shall arise each time an
Indemnified Party acquires knowledge of any matter described herein. Separate and successive
actions may be brought hereunder to enforce any of the provisions hereof at any time and from
time to time. No action hereunder shall preclude any subsequent action.
12 Se eraki1it r. If any provision of this Indemnity shall be determined to be unenforceable in
any circumstances by a court of competent jurisdiction, then the balance of this Indemnity never-
theless shall be enforceable, and the subject provision shall be enforceable in all other circumstan-
ces,
5
•
13. Attorneys' Fees: In any action or proceeding brought by the Indemnified parties to enforce
any rights under this Indemnity, the prevailing party shall be entitled to all reasonable attorn ys'
fees and all costs, expenses and disbursements in connection with such action.
14. Notices, All notices under this Indemnity shall be in writing and sent (a) certified or
registered sail, return receipt. requested, a nationally recognized overnight courier such as
UPS or FedEx, or (c) delivery. All notices shall be delivered to the following addresses
(which addresses may be changed by written notice):
Lender:
I.nd mnitor:
With a copy to:
With a copy to:
With a copy to:
With a copy to:
Community Development Comr mis ion-
ousing Authority of the City of National City
1243 National City Blvd.
National City, CA 91950
Attn: Executive Director
D Avenue Housing Associates, L.P.'
c/o Community ou ingWor
3111 Camino Del Rio North, Suite 800
San Diego, CA 92108
Attention: Senior Vice President
Downs Pham Kuei LLP
235 Montgomery Street, 3 ' Floor
San Francisco, CA 94010
Attention: Irene C, Kuei
Bank of Atria, N.A.
MA1. - 22S O2- 2
225 Franklin Street
Boston, MA 02110
Attention: Asset Management
Banc of America CDC Special Holding Company, Inc.
MA 1-22 -02 02
225 r nl li Street
Boston, MA 02110
Attention: Asset Management
Buchalter, a Professional Corporation
1000 Wilshire Boulevard, Suite 1.00
Los Angeles, CA 90017
Attn: Michael A. Williamson, Esq.
Matter No: B0965-0654
15. Governing Law, This Indemnity shall be governed by and construed in accordance with
the laws of he State of California.
6
16. Counterparts. This Indemnity may be executed in any number of counterparts and, as so
executed, the counterparts shall constitute one and the same agreement. The parties agree that
each such counterpart is an original and shall be binding upon all the parties, even though all of
the parties are not signatories to the same counterpart.
17. Exhibits and Recitals Ineothporated. All exhibits referred to in this Indemnity, if any, are
hereby incorporated in this Indemnity r b ► this reference, regardless of whether or not the exhibits
are actually attached to this Indemnity. The Recitals to this Indemnity are hereby incorporated in
this Agreement by this reference
18. Signature Authority. All individuals signing this Indemnity for a party which is a
corporation, limited liability company, partnership or other legal entity, or signing under a power
of attorney, or as a trustee, guardian, conservator, or in any other legal capacity,covenant to the
Lender that they have the necessary capacity and authority to act for, sign and bind the respective
entity or principal on whose behalf they are signing.
IN WITNESS WHEREOF, this Indemnity is executed as of the day and year above written.
I D ■••M IT :
D AVENUE HOUSING ASSOCIATES, .P.,
a California limited partnership
By: CHW D Avenue, LLC, a California limited liability company
Its: Managing General Partner
By: Community 1-IousingWor• s,
a California nonprofit public benefit corporation
sole member and manager
Its:
By:
Mary Jar # (lag zi
Senior e P esid
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
7
LENDER:
COMMUNITY DEVELOPMENT COMMISSION -
HOUSING AUTHORITY OF THE CITY OF NATIONAL CITY,.
a public body, corporate and politic
pt
By:
Tony Winne)/, Assistant City Manner
A.PPRON ED AS TO FORM:
APPR TO
Christensen & Spath LLI
Lender Special Counsel
B. AP
Walter FIRiticill
Exhibit "A"
Property Description
The land referred to herein Is situated in the State of California, County of San Diego and
described as follows:
SITE 1
KIMBALL, EAST (FEE)
APN: 00-0 0 1, 0 0 0-16, and 0-0 0-18
PARCEL 1:
PARCEL E OF THE CERTIFICATE OF COMPLIANCE RECORDED SEPTEMBER 1 2021 AS
INSTRUMENT NO 2021-0621565 F OFFICIAL RECORDS IN THE COUNTY OF SAN DIEGO,
STATE. OF CALIFORNIA, FULLY DESCRIBED AS FOLLOWS:
THAT PORTION ON OF THE EASTERLY HALF OF THE 10-ACRE LOT 11, IN QUARTER SECTION
154 OF THE RANCHO DE LA NACION, N, IN THE CITY OF NATIONAL CITY, COUNTY OF SAN
DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE MAP THEREOF BY M R ILL NO. 166
AND LOT 3 OF CENTER CITY PROJECT MAP NO. 8807, BOTH FILED IN THE OFFICE OF THE
RECORDER OF SAID SAN DIEGO COUNTY, BEING MORE PARTICULARLY DESCRIBED AS
FOLLOWS:
"PARCEL B":
COMMENCING ENCING AT THE NORTHEASTERLY CORNER OF SAID LOT 11, SAID POINT ALSO
BEING ON THE CENTERLINE OF HIGHLAND AVENUE, LYING NORTH 17° 7' O"x WEST A
DISTANCE OF 330.91 FEET FROM THE CENTERLINE INTERSECTION OF HIGHLAND AVENUE
AND EAST 14TH STREET; THENCE LEAVING SAID CENTERLINE, LINE, SOUTH 7 °0 '03" WEST A
DISTANCE OF 40.00 FEET TO THE WESTERLY RIGHT-OF-WAY HI.GHLAND AVENUE; THENCE
ALONG SAID RIGHT-OF-WAY, , SOUTH 17°47'10" EAST A DISTANCE OF 310,91 FEET TO THE
NORTHERLY LY LINE OF THE 20 FOOT RIGHT-OF-WAY OF EAST I TH STREET; THENCE ALONG
SAID RIGHT OF -WAY, SOUTH 72'0 '1 " VVEST A DISTANCE OF 434.81 FEET TO THE TRUE
POINT OF BEGINNING; THENCE SOUTH 72°0 ' 4" WEST A DISTANCE OF 71.53 FEET;
THENCE, NORTH 17° 4'4 " WEST A DISTANCE OF 5.13 FEET TO THE BEGINNING OF A 220.00
FOOT RADIUS CURVE, CONCAVE NORTHERLY, THEF LY, A RADIAL TO SAID POINT BEARS SOUTH 17°
54'48"EAST; THENCE WESTERLYALONG THE ARC OF SAID CURVE THROUGH A CENTRAL
ANGLE OF 1 O I ' f ", AN ARC LENGTH OF 66.06 FEET; , THENCE NORTH 17°54 ° 14" WEST
A DISTANCE OF 33.12 FEET; THENCE .NORTH 72°0 ' 6" EAST A DISTANCE OF 19,97
FEET; THENCE NORTH 17° 4' 4' WEST A DISTANCE OF 262.63 FEET TO.A POINT ON THE
NORTHERLY LINE OF SAID LOT 11; THENCE ALONG SAID NORTHERLY EI L LINE, NORTH 72°
04'0 " EAST A DISTANCE OF 207i ' FEET; THENCE SOUTH 0 ° t " WEST A DISTANCE
OF 64,59 FEET; THENCE SOUTH 72°04'03" WEST A DISTANCE OF 68,84 FEET; THENCE
SOUTH 17° 4'3 " EAST A DISTANCE OF 249,96 FEET TO THE TRUE POINT OF BEGINNING,
CONTAINING 0.96 ACRES OR '1 506.93 SQUARE E FEET MORE OR LESS,
PARCEL 2:
AN EMERGENCY ACCESS EASEMENT FOR PURPOSES ALONG, OVER, UNDER ACROSS
ALL PORTIONS OF PARCEL A OF BOUNDARY ADJUSTMENT PLAT NO, 2021-5141, FILED IN
THE CITY OF NATIONAL CITY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA RECORDED
DED
SEPTEMBER I, 2021 AS INSTRUMENT NO. 2021-0621OF OFFICIAL RECORDS RDS IN THE
COUNTY OF SAN DEG , STATE OF CALIFORNIA. IA.
9
SITE
KIMBALL WEST (LEASE)
APN:560-410-06
LOT 6 OF CENTER CITY PROJECT, IN THE CITY OF NATIONAL CITY, COUNTY TY OF SAN DIEGO,
STATE. OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 88071 FILED IN THE OFFICE OF THE
COUNTY RECORDER I DE F SAN DIEGO COUNTY, FEBRUARY , 1978.
RECIPROCAL EASEMENTS
"EASEMENT AND JOINT USE AGREEMENT [RECIPROCAL EASEMENT AGREEMENT]" DATED
MARCH 282 2019 BY AND BETWEEN KIMBALL TOWER USIl G ASSOCIATES, L.P., A
CALIFORNIA LIMITED PARTNERSHIP AND MORGAN TOWER HOUSING ASSOCIATES, LP., A
CALIFORNIA LIMITED PARTNERSHIP RECORDED DED MARCH 29, 2019 AS INSTRUMENT NO. 2019-
'3114010 OF OFFICIAL RECORDS.
"EASEMENT T AND JOINT USE AGREEMENT" DATED MARCH 28, 2019 BY AND BETWEEN KIMBALL
TOWER HOUSING ASSOCIATES, L.P., A CALIFORNIA LIMITED PARTNERSHIP IERSHIP AND MORGAN
TOWER HOUSING ASSOCIATES, L_.P., A CALIFORNIA LIMITED PARTNERSHIP RECORDED MARCH
29, 2019 .AS INSTRUMENT UMEI T NO. 2019-0114030 OF OFFICIAL RECORDS.
RDS,
(End of Legal Description)
10