Loading...
HomeMy WebLinkAboutORANGE COUNTY COMMUNITY HOUSING CORPORATION (OCCHC) - 1996-11-18 r 4 u r Council/Agency Meeting Held: �• 30 Deferred/Continued to: [Approved ❑ onditi ally Approved ❑ Denied City Clerk's Si ature Council Meeting Date: 11/18/96 Department ID Number: ED 96-03 CITY OF HUNTINGTON BEACH REQUEST FOR CITY COUNCIL/REDEVELOPMENT AGENCY ACTION SUBMITTED TO: HONORABLE MAYOR AND CITY COUNCIL SUBMITTED BY: MICHAEL T. UBERUAGA, CITY ADMINISTRATOR -` PREPARED BY: DAVID C. BIGGS, DIRECTOR OF ECONOMIC DEVELOPMENT SUBJECT: APPROVAL OF A LOAN AGREEMENT WITH ORANGE COUNTY COMMUNITY HOUSING CORPORATION (OCCHC) FOR THE ACQUISITION OF 17422 & 17432 QUEENS LANE Statement of Issue,Funding Source,Recommended Action,Alternative Action(s),Analysis,Environmental Status, Attachment(s) Statement of Issue: A HOME Investment Partnership program Loan Agreement between the City and Orange County Community Housing Corporation (OCCHC) is submitted for approval. This agreement provides $490,000 in HOME funds for the acquisition and rehabilitation 17422 and 17432 Queens Lane. Funding Source: 1994 and 1995 HOME Investment Partnership funds. These funds are not deposited directly into City accounts. They are drawn directly ( as projects are approved by Council) from the federal treasury as needed for project costs and staff salary and benefit costs. All expenditures are tracked and recorded by the Accounting Division, in cooperation with Economic Development staff. Recommended Action: Motion to: City Action(s): 1. Approve a commitment agreement for 1995 HOME funds in the amount of $90,800 to the Redevelopment Agency.. 2. Waive the City's insurance requirements for purposes of approving the Agency loan agreement only. Direct staff to ensure that the minimum insurance requirements are met by OCCHC by the close of escrow. Redevelopment Agency Actions: 1. Approve a loan agreement with Orange County Community Housing Corporation (OCCHC) for $490,000 in HOME Investment Partnership funds for the acquisition and rehabilitation of 17361 and 17371 Koledo Lane. —, REQUEST FOR CITY COUNCIUREDEVELOPMENT AGENCY ACTION MEETING DATE: 11118/96 DEPARTMENT ID NUMBER: ED 96-03 2. Approve and authorize execution by the Agency Chairman and Clerk of the regulatory agreement (Attachment No. 4 to the affordable housing agreement) between the Redevelopment Agency of the City of Huntington Beach and OCCHC concerning the acquisition of 17422 and 17432 Queens Lane. Alternative Action: 1. Do not approve the proposed transaction. OCCHC will lose a non-refundable deposit of$7,900.00 Analysis: At its June 3, 1996, meeting, the City Council committed $399,200 in HOME funds to the Redevelopment Agency in order to meet a twenty-four month deadline. Council's direction to staff at that time was to commit the funds to a project as soon as possible. Staff and OCCHC have concluded negotiations (a complete outline of deal points is included as Attachment No. 4) and have agreed to the following terms: • The City of Huntington Beach will provide $490,000 in HOME Investment Partnership Bands as a residual receipts loan to Orange County Community Housing Corporation (OCCHC). These funds will be used to acquire the two 4-unit rental properties on Queens Lane. • All units will remain affordable for thirty years for households earning less than 50% of Orange County median income (defined as very low income) as adjusted for family size. The thirty year affordability period exceeds those minimums (ten to fifteen years) required by the HOME program. Because these properties are located in a redevelopment project area and also due to a thirty-year affordability period, these units will be credited toward the Redevelopment Agency's housing obligations. • The amount of HOME assistance will be carried as an interest free loan provided that the units remain in compliance with the terms of the agreement. Should a default occur, or should the units be sold or transferred before the term of affordability expires, the full amount of the HOME assistance must be repaid with six percent (6%) simple (but a-.truing) interest. RCA2.DOC -2- 11112/96 9.38 AM REQUEST FOR CITY COUNCILMEDEVELOPMENT AGENCY ACTION MEETING DATE: 11118196 DEPARTMENT 1D NUMBER: ED 96-03 • Beginning in the fifth year of the agreement, and continuing annually through the thirtieth year, OCCHC will forward the proceeds of a residual receipts account to the City as a means of repayment of the HOME assistance., The minimum amount of any annual repayment will be $1,200.00. • At the end of the thirty-year term, any remaining principal amount of the loan will be repaid to the City. While there will be no interest due, the principal amount of the loan will be adjusted annually for inflation to reflect the present value of the funds after thirty years. • Rents will be set at levels that are affordable to households earning less than 50% of median income. These rent restrictions will exceed those required by HOME regulations. Unit Size tojected Rent IETwo Bedroom $450+ HUD sets maximum per unit HOME subsidy amounts on a annual basis. Currently, the maximum subsidy amount for a two bedroom unit is $86,352; With that number, the maximum total subsidy for the Koledo Lane project would be $690,816. The actual subsidy per unit breakdown on this project is as follows: Total HOME Subsidy: S490,000 Total Number of Units: 8 Per Unit H01VE Subsidy $ 61.250 Acquiring and rehabilitating small multifamily properties represents an opportunity to improve and preserve existing affordable housing throughout Huntington Beach, but especially in a focus area such as the Oakview neighborhood. Purchase of another property by a housing nonprofit in this area is another step toward stabilizing rental property ownership, which in turn should help improve the quality of the housing in the neighborhood by keeping rents low, and eliminating overcrowding--at least in these buildings. These units will be available to very low income households (who are currently paying $750 per month in rent)with affordable rents in the $450 per month range. It is not unusual to find two families living together in one-family units because of the high rents. RCA1.DOC -3- 1110519611:58 AM { t' f Teccf�o�ebl r► `U�Deb eD 8 f UPIPLC-2 �t�Q"[ icia"c, e, cal ifornia Pe4va"' TD: Recorclecl in the County of orange, Granville, Clerk/Recorder +fCI4.K Gary IIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIII No Fee 95 P. °• a (.90 IIIIIIIIIIIIIIIIIIIIIIIIIIIIII 19960658660 3,16pm 12�31 f�fun�nJ-J - a6ac�, Ca Sac` JV 005 150@5999 15 33 00 0.00 Al2 20 7.00 57.00 0.00 0.00 0. Affordable Housing Agreement (Acquisition and Rehabilitation of 17422 & 17432 Queens Lane) By and Between the Redevelopment Agency of the City of Huntington Beach, Lender, � and Orange County Community Housing Corporation, a Nonprofit , Borrower i a. a , x HOME Partnership Agreement M94-MC060514 & M95-MC060514 CHDO # M94-060514-01 a;\0CCHC\Barton\Cover1.doc T ` LOAN AGREEMENT BY AND BETWEEN THE REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACII AND THE ORANGE COUNTY COMMMUNITY HOUSING CORPORATION CONCERNING THE ACQUISITION AND REHABILITATION OF AFFORDABLE HOUSING ON KOLEDO LANE NN'ITH FUNDS OBTAINED FROM THE HOME INVESTMENT PARTNERSHIP PROGRAM This Loan Agreement is made this 1,Lday of , 1996,by and between ORANGE COUNTY COMMUNITY HOUSING CORPORATION,a California nonprofit public benefit corporation(hereinafter referred to as "Borrower"),and THE REDEVELOPMENT AGENCY OF THE CITY OF HUNTINGTON BEACH,a public body of the State of California("hereinafter referred to as Lender"). NWIEREAS, Lender and Borrower%Nrish to enter into an agreement for the loan of HOME Investment Partnership Program funds for the purpose of acquiring and rehabilitating certain affordable rental housing units located on Queens Lane in the City of Huntington Beach,as more fully described hereinbelow;and These Recitals refer to and utilize certain capitalized terms which are defined in Article 1 of this Agreement. The parties intend to refer to those definitions in conjunction with the use of capitalized terms in these Recitals;and Lender wishes to promote the development of more affordable rental housing in neighborhoods in need of revitalization in the Huntington Beach community and to provide a greater choice of housing opportunities for persons and families of low income;and Lender has received Home Investment Partnership Program funds("110ME Funds') from the United States Department of Housing and Urban Development("HUD")pursuant to the Cranston-Gonzales National Housing Act of 1990 for the purpose of expanding the supply of decent, safe,sanitary and affordable housing for very-low and low-income persons and families; and Borrower proposes to acquire the real property and improvements located at 17422 and 17432 Queens Lane, Huntington Beach, California(as more particularly described in Exhibit A) (the"Property'), for the rehabilitation of ten units housing of affordable to very-low income households as defined in this Loan Agreement for this project(the"Project"); and Borrower Ashes to borrow from Lender and Lender wishes to extend to Borrower a loan of HOME funds to support development of the Project. The Loan is being made to finance acquisition costs associated with the Project in order to help achieve financial feasibility for the project and maximize the affordability of the rental housing, I 4!kW gTer Queens1*anagre RLS96-758-1114/96 T � f NOW TIIEREFORE, in consideration of the mutual agreements,obligations,and representations,and in further consideration for the making of the Loan, Borrower and Lender hereby agree as follows: ARTICLE 1. DEEINITIONS The following terms shall have the meanings and content set forth in this section wherever used in this Loan Agreement. 1.1 "BORROWER" means Orange County Community Housing Corporation,a California nonprofit public benefit corporation,and its authorized representatives,assigns, transferees, or successors-in-interest thereto. 1.2 "CERTIFICATE OF PROJECT COMPLETION" means that certificate issued to Borrower by Lender evidencing completion of the Project pursuant to the terms of this Loan Agreement. 1.3 "AGENCY" means the Redevelopment Agency of the City of Huntington Beach, a public body,and its authorized representatives,officers,officials, employees and agents. 1.4 "HAZARDOUS MATERIALS" means any hazardous or toxic substances, materials,wastes,pollutants,or contaminants which are defined,regulated,or listed as "hazardous substances," "hazardous wastes," "hazardous materials," "pollutants," "contaminants," or"toxic substances," under federal or state environmental and health and safety laws and regulations,including without limitation petroleum and petroleum byproducts, flammable explosives,urea formaldehyde insulation,radioactive materials,asbestos,and lead. Hazardous Materials do not include substances that are used or consumed in the normal course of developing,operating,or occupying a housing project,to the extent and degree that such substances are stored, used,and disposed of in the manner and in amounts that are consistent with normal practice and legal standards. 1.5 "HOME" means the HOME Investment Partnership Program created by the National Affordable Housing Act of 1990. I.6 "IIUD" means the United States Department of Housing and Urban Development. 1.7 "LEASE" means the lease entered into between Borrower and a tenant of a unit in the Project. 1.8 "LENDER" means the Redevelopment Agency of the City of Huntington Beach, a public body,and its authorized representatives,officers,officials, employees,and agents. 2 4WAgee:Qucens:l oanagre RLS96-758.11/4196 1.9 "LOAN" means the loan of HOME Investment Partnership Program funds provided by Lender to Borrower pursuant to this Loan Agreement. 1.10 "LOAN AGREEIIZENT" means this loan agreement entered into between Lender and Borrower. 1.11 "LOAN DOCUMENTS" means,collectively,this Loan Agreement,the Notes and the Deeds of Trust that shal I be executed in cormcction with the Loan,as they may be amended,modified,or restated from time to time,along NNith all exhibits and attachments to these documents. 1.12 "MEDIAN INCOME" means the median income for the Orange County Primary Metropolitan Statistical Area(PMSA),with adjustments for household size,as determined from time to time by the U.S. Department of Housing and Urban Development (HUD)pursuant to the United States Housing Act of 1937 as amended,or such other method of median income calculation applicable to the City that HUD may hereafter adopt in connection with said Act. 1.13 "NOTE" means that promissory note executed by Borrower in favor of Lender evidencing the Loan,as well as any amendments to,modifications of,or restatements of said promissory note. The Note shall be in substantially the same form as the document attached hereto as Attachment No. 2. 1.14 "OPERATING EXPENSES"mea-as all reasonable and proper expenses for occupancy and rehabilitation of the Project, including: real estate taxes;other taxes; insurance, including mortgage loan insurance; debt service and other periodic fees and payments in connection,with any amortized loan approved by Lender,repayment of the Borrower's equity and interest in the Project(interest shall accrue at the same rate of the primary loan secured by a deed of trust);maintenance and repair;costs of renting and management;fuel;utilities;garbage disposal; sewer charges; audit expenses;required reserve deposits including operating and reserve income;and other cash payments which may be approved by Lender. 1.15 "PLANS AND SPECIFICATIONS" means the plans and specifications which shall be used to rehabilitate the Project. 1.16 "PROJECTS" means the eight(8)units of rental housing on the Properties to be owned and operated by the Borrower for Very-Low Income Households according to the terms of this Loan Agreement. 3 41MAgrecQueensleanagre RL596-758-1114/96 r , 1.17 "PROPERTIES" consists of the real property located at 17422 and 17432 Queens Lane,Huntington Beach, California as more particularly described in the attached Exhibit A,which is incorporated into this Loan Agreement by this reference. 1.18 "REGULATORY AGREEMENT" shall mean the agreement executed by the Borrower for the benefit of the Agency, limiting the income of families eligible to rent the units to Very Low Income Households and in addition limiting the amount of cent that can be charged for the units for a minimum of thirty(30)years,and a maximum of fifty-nine(59)years, in substantially the same form as the document attached hereto as Attachment No.4. 1.19 "REVENUE" means the gross rental income derived from the ownership, operation and management of the Project. 1.20 "RESIDUAL RECEIPTS" means the Revenue,less the sum of Operating Expenses,and annual deposits to required operating reserves and placement reserves calculated on an annual basis. 1.2I "VERY LOW I`'COME HOUSEHOLDS" shall mean a family or individual whose annual income does not exceed fifty percent(50%)of the median income for the Orange County Metropolitan Statistical Area as determined by HUD .-.ith adjustments for smaller and larger families. ARTICLE 2. ATTACHMENTS The folloidng documents are attached to this Loan Agreement as Attachments and are incorporated into this Loan Agreement by this reference as though fully set forth: 2.1 ATTACI iMENT NO. 1: Legal Description: 17422 Queens Lane ATTACHMENT NO. IA: Legal Description: 17432 Queens Lane 2.2 ATTACHMENT NO. 2: Promissory Note: 17422 Queens Lane ATTACHMENT NO.2A: Promissory Note: 17432 Queens Lane 2.3 ATTACHMENT NO. 3: Deed of Trust: 17422 Queens Lane ATTACHMENT NO. 3A: Deed of Trust: 17432 Queens Lane 2.4 ATTACHMENT NO.4: Regulatory Agreement: 17422 Queens Lane ATTACHMENT NO. 4A: Regulatory Agreement: 17432 Queens Lane 4 411 A&mc:Quccns:LoanaSm RLS96-759-t 1/4196 2.5 ATTACHMENT NO. 5: Scope of Work 2.6 ATTACHMENT NO. 6: Schedule of Performance 2.7 ATTACHMENT NO. 7: City of Iiuntington Beach Rental Property Acquisition Guidelines 2.8 ATTACIIMENT NO. 8 City of Huntington Beach Multi-Family Rental Rehabilitation Loan Program Guidelines ARTICLE 3. TERMS OF LOAN 3.1 LOAN. Lender agrees to provide a loan of HOME funds to Borrower under the terms and conditions of the Loan Documents. 3.2 ANIOUN IT OF LOAN. On and subject to the terms and conditions of the Loan Documents,Lender agrees to make and Borrower agrees to accept a Ioan not to exceed Four Hundred Ninety Thousand Dollars($490,000),which shall be evidenced by the Notes,and secured by the Deeds of Trust. 3.3 INTEREST. The Note shall bear simple interest at the rate of six percent(6°/e) per annum on the principal amount outstanding from the date of the Note until paid or forgiven. 3.4 REPAYMENT OF LOAN. There may be periodic payments under the Note. Commencing on the fifth(5th)anniversary of the close of Escrow and continuing until the thirtieth(30th)anniversary of the Close of Escrow, the Borrower shall make minimum annual payments(the"Annual Payment') in the amount of One Thousand Two Hundred Dollars ($1,200.00). Each Annual Payment shall be due annually on each anniversary of the Close of Escrow beginning on the fifth(5th)anniversary of the Close of Escrow and continuing and including the thirtieth(30th)anniversary of the Close of Escrow;provided,however,that remaining outstanding principal of the Loan shall be repaid on the thirtieth(30th)anniversary of the Close of Escrow.If the balance of the Residual Receipts account is insufficient to fully fund an Annual Payment,Borrower agrees to make-up any shortfall that may exist in the account so that the Annual Payment can be made. Borrower may request that the Lender reduce, suspend or forgive an Annual Payment,and the Borrower may present evidence to the Lender of its inablility to make an Annual Payment;however,Lender reserves the exclusive right in its sole discretion to reduce,suspend or forgive an Annual Payment. All principal and interest on the Loan shall be due in full upon the earliest to occur of: 5 4WAgree:Queens:t oanagre RLS96-758-1114196 i (1) the occurrence of default under this Agreement,the Note,the Deed of Trust,or the Agreement Containing Covenants,which event of default is not cured within the applicable cure period; or (2) the thirtieth(30th)anniversary of Close of Escrow. 3.5 LOAN SECURITY. Upon the making of the Loan,the Borrower shall cause to be executed and recorded in the official records of Orange County the Deeds of Trust,and the Regulatory Agreements. 3.6 PREPAYMENT OF LOAN. No prepayment penalty will be charged to Borrower for payment of all or any portion of the Loan amount prior to the end of the Loan term described herein. 3.7 CONDITIO`'S PRECEDENT TO DISBURSEAIEN T. Lender shall not be obligated to make disbursements of Loan proceeds unless all of the following conditions precedent are satisfied: 1. There exists no Event Default under the Loan Agreement. 2. Borrower has delivered a management plan acceptable to the Lender for the on- going management and operation of the Project. 3. Borrower has received a final certificate of occupancy for this Project. 3.8 LENDER'S OPTION TO PURCHASE. Upon notice to Lender that Borrower intends to effect a transfer of the Property as provided in Section 4.7 hereof,or upon the termination of this Agreement,Lender shall have the right, for 60 days after such notice or termination,to purchase the Property at the fair market value thereof,less the principal amount of I TOME funds originally loaned to the Borrower and adjusted annually for inflation based on the Consumer Price Index (CPI),or another comparable index,as mutually agreed upon by both parties. Lender shall exercise this right in its sole discretion. The fair market value shall be determined by a qualified real estate appraiser,mutually selected by the Borrower and Lender. ARTICLE 4. PROJEOr_OPFRATION 4.1 OPERATION OF PROJECT. Borrower shall lease,operate and manage the Project in full conformance with the terms of the Regulatory Agreement. 6 4'a1rlgrer.Quecnsloanagrc Ri.s%-758.1114196 4.2 INCOME CERTIFICATION. Borrower shall determine the income eligibility of each prospective tenant household prior to renting a Project unit to such household. Borrower shall certify each tenant household's income on an annual basis. 4.3 AFFORDABILITY RESTRICTIONS. The affordability of the Projects shall be maintained for a minimum period of thirty(30)years following the recordation of the Regulatory Agreement. All ten(I0)units in the Projects shall at all times be occupied or held vacant and available for rental by Very Low Income Households. Income determination shall be made at the time of initial-occupancy of a unit by a tenant. 4.4 AIAXIA'IUM RENTAL CHARGES. The total charges for rent,utilities,and related services to each Very Low-Income Household shall not exceed thirty percent(30%)of fifty percent(50%)of Median Income. Maximum annual rent increases shall be calculated by Lender based on the change in permissible rents published annually by HUD,exclusively for the HOME Program. 4.5 NONDISCRIMINATION. Borrower shall not discriminate or segregate in the development,construction, use,enjoyment,occupancy,conveyance, lease, sublease,or rental of any part of the Property on the basis of race,color,ancestry,national origin, religion,sex,sexual preference, age,marital status, family status, source of income,physical or mental disability, Acquired Immune Deficiency Syndrome(AIDS)or AIDS-related conditions (ARC), or any other arbitrary basis. Borrower shall otherwise comply with all applicable local,state,and federal laws concerning discrimination in housing. 4.6 ENCUMBRANCE OF PROPERTY. Except as otherwise provided in this Loan Agreement, Borrower shall not engage in any financing or any other transaction creating any security interest or other encumbrance or lien upon the Property,whether by express agreement or operation of law,or allow any encumbrance or lien to be made on or attached to the Property, except with the prior written consent of Lender. Borrower shall notify Lender in writing in advance of any financing secured by any deed of trust,mortgage,or other similar Iien instrument that it Proposes to enter into with respect to the Project or Property,and of any encumbrance or lien that has been created on or attached to the Property NNbether by voluntary act of Borrower or otherwise. Borrower agrees to fully satisfy and payoff all existing liens and deeds of trust prior to funding through this HOME agreement. This provision is subject to verification by Agency. 4.7 TRANSFER OF PROPERTY. Borrower has neither made or created,and shall not make or permit any sale, assignment,conveyance,Iease,or other transfer of this Loan Agreement,the Project,or the Property,or any part thereof, including the sale of any general or limited partnership interests,without the prior written consent of Lender. 7 4` V%greetQucens:Loanagre RLS96-753-l 114/96 4.8 LEAD-BASED PAINT. Borrower shall ensure that it and its contractors and subcontractors shall not use lead-based paint in the construction or maintenance of the Property. Borrower shall insert this provision in all contracts and subcontracts for work performed on the Project which involve the application of paint. Borrower%%ill test both properties for the presence of lead-based paint as required by HUD regulations. Borrower will furnish copies of test results to Lender. Borrower%ill remediate any asbestos or lead-based paint hazards where the level of that substance is found to be in excess of acceptable thresholds. 4.9 BARRIERS TO THE DISABLED. Borrower shall ensure that the Project shall be developed and the Property shall be maintained to comply with all applicable federal,state, and local requirements for access for disabled persons. 4.10 INDEAINIFICATION,DEFENSE,IIOLD IIARNILESS. Borrower hereby agrees to protect,defend,indemnify and hold and save harmless Lender,its officers and employees against any and all liability,claims,judgments,costs and demands,however caused, including those resulting from death or injury to Borrower's employees and damage to Borrowees property,arising directly or indirectly out of the obligations or operations herein undertaken by Borrower, including those arising from the passive concurrent negligence of Lender, but save and except those which arise out of the active concurrent negligence,sole negligence,or the sole willful misconduct of Lender. Borrower will conduct all defense at its sole cost and expense. Lender shall be reimbursed by Borrower for all costs or attorney's fees incurred by Lender in enforcing this obligation. 4.11 WORKERS' COMPENSATION INSURANCE. Pursuant to the Califami Labor Code Section 1861,Borrower acknowledges awareness of Section 3700 et seq. of said code,which requires every employer to be insured against liability for workers'compensation; Borrower covenants that it will comply with All such labs and provisions prior to commencing performance of the work hereunder. Borrower shall maintain such Workers'Compensation Insurance in an amount of not less than One Hundred Thousand Dollars($100,000)bodily injury by accident,each occurrence,One Hundred Thousand Dollars ($100,000)bodily injury by disease,each employee, and Two Hundred Fifty Thousand Dollars($250,000)bodily injury by disease,policy limit,at all times incident hereto,in forms and underwTitten by insurance companies satisfactory to Lender. Borrower shall require all subcontractors to provide such Workers'Compensation Insurance for all of the subcontractors'employees. Borrower shall furnish to Lender a certificate of waiver of subrogation under the terms of the Workers'Compensation Insurance and Borrower shall similarly require all subcontractors to waive subrogation. 4.12 INSURANCE COVERAGE. Borrower shall carry at all times incident hereto, on all operations to be performed hereunder,general liability insurance, including coverage for 8 41,MAgrecQueen:Loanagre RLS96-759-11/4Nb bodily injury, property damage,and blanket contractual liability. Said insurance shall also include automotive bodily injury and property damage liability insurance. All insurance shall be underwritten by insurance companies in forms satisfactory to Lender for all operations, subcontract work,contractual obligations,product or completed operations and all owned vehicles and non-o hmed vehicles. Said insurance shill name the Lender,its officers,agents and employees and all public agencies as determined by the Lender as Additional Insureds. Borrower shall subscribe for and maintain said insurance policies in full force and effect during the life of this Agreement, in an amount of not less than One Million Dollars($1,000,000). In the event of aggregate coverage,Borrower shall immediately notify Lender of any known depletion of limits. Borrower shall require its insurer to waive its subrogation rights against Lender and agrees to provide certificates evidencing the same. 4.13 CERTIFICATES OF INSURANCE; ADDITIO►VAL INSURED ENDORSEMENT. Prior to commencing performance of the obligations undertaken hereunder, Borrower shall furnish to Lender certificates of insurance subject to approval of the City Attorney evidencing the foregoing insurance coverages as required by this Agreement; said certificates shall provide the name and policy number of each carver and policy,and shall state that the policy is currently in force and shall promise to provide that such policies%ill not be canceled without thirty(30)days prior written notice to Lender. Borrower shall maintain the foregoing insurance coverages in force until the rehabilitation work under this Agreement is fully completed and accepted by Lender. The requirement for carrying the foregoing insurance shall not derogate from the provisions for indemnification of Lender by Borrower under this Agreement. Lender or its representative shall at all times have the right to demand the original or a copy of all said policies of insurance. Borrower shall pay,in a prompt and timely manner,the premiums on all insurance herein above required. A separate copy of the additional insured endorsement to each of Borrower's insurance policies,naming the Lender,its officers and employees as Additional Insureds shall be provided to the City Attorney for approval prior to any payment hereunder. 4.14 RELOCATION REQUIREMENTS. Borrower shall comply with any and all of the Agency's relocation requirements pursuant to California Government Code Section 7260 et seq., California Health&Safety Code Chapter 4,Article 9,Section 33410,et seq., and 49 Code of Federal Regulation Part 24 (the"Requirements". The Borrower shall submit for the Agency's approval, a copy of the relocation plan prepared pursuant to the Requirements,prior to the relocation of any tenant in the Project. 4.15 RELOCATION. Borrower agrees to indemnify,protect,hold harmless and defend the Agency, its council members,officers and employees from all suits,actions,claims, 9 4'.1 lAgnx:Quccns:Loanagrc RL596-758-11l4196 causes of action,costs,demands,judgments and liens arising out of the Borrower's performance or non-performance of the Requirements. ARTICLE 5. HAZARDOUS MATERIALS 5.1 REPRESENTATIONS AND NVARRANTIES. After reasonable investigation and inquiry,Borrower hereby represents and warrants to the best of its knowledge,as of the date of this Loan Agreement and except as previously disclosed and acknowledged in writing by Lender or as disclosed by the reports based on environmental audit(s)performed on the Property and submitted to Lender,that(a)the Property is not and has not been a site for the use, generation,manufacture, transportation, storage,or disposal of hazardous Materials; (b)the Property is in compliance with all applicable environmental and health and safety laws, regulations, ordinances,administrative decisions,common Inv decisions(whether federal,state, or local)with respect to Hazardous Materials, including those relating to soil and groundwater conditions("Iazardous Materials Laws");(c)there are no claims or actions pending or threatened with respect to the Property by any governmental entity or agency or any other person relating to Hazardous Materials; and(d)there has been no release or threatened release of any hazardous Materials on,under,or near the Property(including in the soil,surface water,or groundwater under the Property)or any other occurrences or conditions on the Property or on any other real property that could cause the Property or any part thereof to be classified as a "hazardous waste property" or as a "border zone property" under California Health and Safety Code Sections 25220,et seq.,or regulations adopted therewith. 5.2 NOTIFICATION TO LENDER. Borrower shall immediately notify Lender in writing of. (a)the discovery of any concentration or amount of Hazardous Materials on or under the Property requiring notice to be given to any governmental entity or agency under Hazardous Materials Laws; (b)any knowledge by Borrower(after verification of the veracity of such knowledge to Borrower's reasonable satisfaction)that the Property does not comply.Pith any Hazardous Materials Laws; (c)the receipt by Borrower or the Partnership of written notice of any Hazardous Materials claims;and (d)the discovery by Borrower or the Partnership of any occurrence or condition on the Property or on any real property located within 2,000 feet of the Property that could cause the Property or any part thereof to be designated as a "hazardous waste property" or as a"border zone property" under California Health and Safety Code Sections 25220,et seq.,or regulations adopted therewith. 5.3 USE AND OPERATION OF PROPERTY. The Borrower nor any agent, employee,or contractor of Borrower,nor any authorized user of the Property shall use the Property or allow the Property to be used for the generation,manufacture,storage,disposal,or release of Hazardous Materials. Borrower shall comply with hazardous Materials Laws. 10 4%k4lgrce:Qucens:Losnagrc RLS96-759-11/4196 ARTICLE 6. DEFAULT AND REMEDIES 6.1 EVENTS OF DEFAULT. The occurrence of any of the following events shall constitute an"Event of Default" under this Loan Agreement: A. MonetaM (1)Borrower's failure to pay when due any sums payable under the Note or any advances made by Lender under the Deed of Trust or this Loan Agreement;(2)Borrower's use of Loan funds for costs other than Eligible Costs or for uses inconsistent with other terms and restrictions in the Loan Documents; (3) Borrower's failure to obtain and maintain the insurance coverage required under this Loan Agreement;(4)Borrower's failure to make any other payment or assessment due under the Loan Documents; B. Q ea ration. (1)discrimination by Borrower on the basis of characteristics prohibited by this Loan Agreement or applicable law;(2)the imposition of any encumbrances or liens on the Property without Lender's prior written approval that are prohibited under this Loan Agreement or that have the effect of reducing the priority of or invalidating the Deed of Trust; (3)any material adverse change in the condition of Borrower or the Project or permanent financing or funding for the Project that gives Lender reasonable cause to believe that the Project cannot be operated according the terms of the Loan Documents or the Regulatory Agreement; C. General performance of Loan oblicali! ns_ Any substantial or continuous breach by Borrower of any material obligations on Borrower imposed in the Loan Documents or Regulatory Agreement; D. Rgpre5enta*.ions and warranties. A determination by Lender that any of Borrower's representations or%warranties made in the Loan Documents,any statements made to Lender by Borrower,or any certificates,documents,or schedules supplied to Lender by Borrower were untrue in any material respect when made,or that Borrower concealed or failed to disclose a material fact from Lender, E. Jaankruptcy.dissolution, and insolvency. Borrowers or any general partner of Borrower's or any corporation controlling Borrower's(1)filing for bankruptcy, dissolution,or reorganization,or failure to obtain a full dismissal of any such involuntary filing brought by another party before the earlier of final relief or 60 days after the filing; (2)making a general assignment for the benefit of creditors; (3)applying for the appointment of a receiver,trustee,custodian, or liquidator,or failure to obtain a full dismissal of any such involuntary application brought by another party before the earlier of final relief or 60 days after the filing; (4) I1 411AAgrre:Quans:Laanagn: RLS96-758.11/4,96 insolvency;(5) failure, inability or admission in writing of its inability to pay its debts as they become due. 6.2 NOTICE OF DEFAULT AND OPPORTUNITY TO CURE. For nonmonetary Events of Default, Lender shall give written notice to Borrower of any Event of Default by specifying: (a)the nature of the event or deficiency giving rise to the Default, (b)the action required to cure the deficiency,if an action to cure is possible,and(c)a date,which shall not be less than thirty(30)calendar days from the date of receipt of the notice or the date the notice was refused,by which such action to cure must be taken. 6.3 LENDER'S REMEDIES. Upon the happening of an Event of Default by Borrower and a failure to cure said Event of Default within the time specified in the notice of Event of Default(if a notice is required),and Lender may, in addition to other rights and remedies permitted by the Loan Documents or applicable law,proceed%%ith any or all of the following remedies in any order or combination Lender may choose in its sole discretion: A. Bring an action in equitable relief(1)seeking the specific performance by Borrower of the terms and conditions of the Loan Documents,and/or(2) enjoining, abating,or preventing any violation of said terms and conditions, and/or(3)seeking declaratory relief; B. Accelerate the Loan,and demand immediate full payment of the principal amount outstanding;and all accrued interest under the Note,as well as any other monies advanced to Borrower by Lender under the Loan Documents; C. Foreclose under the Deed of Trust and enforce any remedies incident thereto. D. Pursue any other remedy allowed at law or in equity. 6.4 BORROIM'S REMEDIES. Upon the fault or failure of Lender to meet any of its obligations under the;Loan Documents,Borrower may: A. Demand payment from Lender of any sums due Borrower;and/or B. Bring an action in equitable relief seeking the specific performance by Lender of the terms and conditions of the Loan Documents; and/or C. Pursue any other remedy allowed at law or in equity. 12 4',kAAgrcc:Quccns:Loanagrc RL,S96-758-11/4,'96 ARTICLE 7. GENERAL PROVISIONS 7.1 BORROWER'S WARRANTIES. Borrower represents and warrants (1)that it has access to professional advice and support to the extent necessary to enable Borrower to fully comply with the terms of these Loan Documents and the Regulatory Agreement and to otherwise carry out the Project, (2)that it is duly organized,validly existing and in good standing under the Iaws of the State of California,(3)that it has the full power and authority to undertake the Project and to execute the Loan Documents, (4)that the persons executing and delivering the Loan Documents are authorized the execute and deliver such documents on behalf of Borrower, (5) except as disclosed to the Lender in writing,there are no actions or proceedings pending or,to the best of Borrower's knowledge, threatened against the Borrower before any court or administrative agency in,my way connected with the Property or the Project which could adversely affect the Borrower's ability to perform the activities contemplated hereunder, (6) neither this Loan Agreement nor anything provided to be done hereunder violates or shall violate any contract,agreement or instrument to which the Borrower is a party or which affects the Project or any part thereof, (7)the Borrower is not in default in respect of any of its obligations or liabilities pertaining to the Project; nor is there any state of facts or circumstances or conditions or events which, after notice, lapse of time,or both,would constitute or result in any such default,and (8) the Borrower has not entered into any agreements which will adversely affect the title to the Project or the Borrower's right to develop and use the Project as provided in this Loan Agreement,and the Borrower will not enter into any such agreements after the date hereof. 7.2 TERIM OF THIS AGREEMENT. This Loan Agreement shall commence on the date set forth above and remain in full force and effect throughout the term of the Loan. This Loan Agreement shall terminate upon the termination of the Loan. 7.3 GOVERNING LAW. The Loan Documents shall be interpreted under and be governed by the laws of the State of California,except for those provisions relating to choice of law or those provisions preempted by federal law. 7.4 ATTORNEYS' FEES AND COSTS. In the event any Event of Default or any legal or administrative action is commenced to interpret or to enforce the terms of the Loan Documents,each party shall bear its own attorneys' fees and costs. The prevailing party in any such action shall not be entitled to recover any attorneys' fees or costs in such action. 7.5 TIME. Time is of the essence in these Loan Documents. 7.6 CONSENTS AND APPROVALS. Any consent or approval of Lender or Borrower required under the Loan Documents shall not be unreasonably tivithheld. Any approval required under the Loan Documents shall be in writing and executed by an authorized representative of the party granting the approval. 13 4',MAgrcc:Quccns:Loanagre RIS96-758-11/496 7.7 NOTICES,DEMANDS AND COMMUNICATIONS. Formal notices, demands and communications between Borrower and Lender shall be sufficiently given and shall not be deemed given unless dispatched by registered or certified mail,postage prepaid,return receipt requested,or delivered personally,to the principal offices of Borrower and Lender as follows: LENDER: BORROWER: Redevelopment Agency of the Orange County Community(lousing Corporation City of Huntington Beach 1833 East 17th Street 2000 Main Street Suite 207 Huntington Beach,CA 92648 Santa Ana,CA 92701 Attention: Executive Director Attn: Executive Director 7.8 BINDING UPON SUCCESSORS. All provisions of these Loan Documents shall be binding upon and inure to the benefit of the heirs,administrators,executors, successors-in-interest,transferees,and assigns of each of the parties; provided,however,that this section does not waive the prohibition on assignment of this Loan Agreement by Borrower without Lender's consent. 7.9 RELATIONSHIP OF PARTIES. The relationship of Borrower and Lender for this Project under this Loan Agreement is and at all times shall remain solely that of a debtor and a creditor,and shall not be construed as a joint venture,equity venture,partnership,or any other relationship. Lender neither undertakes nor assumes any responsibility or duty to Borrower (except as provided for herein)or any third party with respect to the Project,the Property,or the Loan. Except as Lender may specify in writing, Borrower shall have no authority to act as an agent of Lender or to bind Lender to any obligation. 7.10 ASSIGNMENT AND ASSUMPTION. Borrower shall not assign any of its interests under this Loan Agreement or the Loan Documents to any other party,except as specifically permitted under the terms of the Loan Documents,without the prior written consent of Lender. Any unauthorized assignment shall be void. 7.11 WAIVER. Any waiver by Lender of any obligation in these Loan Documents must be in writing. No waiver will be implied from any delay or failure by Lender to take action on any breach or default of Borrower or to pursue any remedy allowed under the Loan Documents or applicable law. Any extension of time granted to Borrower to perform any obligation under the Loan Documents shall not operate as a waiver or release from any of its obligations under the Loan Documents. Consent by Lender to any act or omission by Borrower I4 4'aVlgfte:Quecns:Loanagrc RLs46-758-l 114196 shall not be construed to be a consent to any other or subsequent act or omission or to waive the requirement for Lender's written consent to future waivers. 7.12 IN I'EGR4TION. This Loan Agreement and the other Loan Documents, including exhibits,executed by Borrower for the Property,if any,contain the entire agreement of the parties and supersede any and all prior negotiations. 7.13 OTHER AGREEMENTS. Borrower represents that it has not entered into any agreements that are inconsistent with the terms of the Loan Documents. Borrower snail not enter into any agreements that are inconsistent with the terms of the Loan Documents without an express waiver by Lender in writing. 7.14 AMEWMENTS AND MODIFICATIONS. Any amendments or modifications to the Loan Documents trust be in writing,and shall be made only if executed by both Borrower and Lender. Balance of page intentionally left blank 15 4WAgree:Queens:LAanag n: RLS96-758-11/4196 7.15 SEVERABILITY. Every provision of this Loan Agreement is intended to be severable. If any provision of this Loan Agreement shall be held invalid,illegal,or unenforceable by a court of competent jurisdiction,the validity,legality,and enforceability of the remaining provisions shall not in any way be affected or impaired. IN WITNESS NNIIEREOF,the parties hereto have executed this Loan Agreement by and through their authori7_ed officers as of the date first above written. BORROWER: LENDER: ORANGE COUNTY COMMUNITY REDEVELOPMENT AGENCY OF THE HOUSING CORPORATION,a California CITY OF HUNTINGTON BEACH,a public nonprofit public benefit corporation body of the State of California By �� 444- 4 Chairman f4 v E Its: By• ATTEST: Its: Agency Clerk APPROVED AS TO FORM:_ _16 . b �y ht Agency Counsel REVIEWED AND APPROVED: INITI TED AND APPROVED: &-Alie Executive Director Director of Economic Development "�7�f fi 16 4'd lAgree:Quccns:Loanagre RLS96-759-1114,196 'CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT State of Fa r-h !County of 6 tZ 4'AGC— On 1.2/2(o/q(" before me, O z1577 Yl A" G►+Pk20O 0 Pale Name O"'M�e.p..'fora Do.,No1a1y PuC4c7 personally appeared 01-t-Lie`Y1 4'L 0W 1 Y1 wmela)co Sgr"al ❑personally known to me—OR—Aproved to me on the basis of satisfactory evidence to be the person whose name( &re subscribe to the within instrument and acknowledged to me thath sheAhey executed the we in(S�erttheir authorized capa(:ROW.and that by ULVherfteir signatureA on the instrument the person, or the entity upon bdhalf of which the person acted, executed the instrument. C1tiaSt>ti�/l.GA21MOOp G0 '�`'fFt�58� WITNESS my hand and official seat. Not"Pua---caffDrrlto Oronl County MY Comm.t x;rse Oct 22.19 W 9L[C Spmture of No"Puhr•c OPTIONAL Though the information below is not required by law,it may prove va r inble to persons dying on the document and could prevent frauculent removal and reattachment of t1is form to another document. Description of Attached Document Title or Type of Document: Document Date: Number of Pages: Signer(s)Other Than Named Above: Capacity(ies) Claimed by Signer(s) Signer's Name: Signer's Name: ❑ Individual ❑ Individual ❑ Corporate Officer ❑ Corporate Officer Title(s): Title(s): ❑ Partner--❑ Limited ❑General ❑ Partner—❑Limited ❑General ❑ Attomey-in-Fact ❑ Attomey-in-Fact ❑ Trustee ❑ Trustee ❑ Guardian or Conservator ❑ Guardian or Conservator ❑ Other: lop of thumb here ❑ Other: TOP of V1umb We Signer Is Representing: Signer Is Representing: Q 1994 Na'onal Notary Association-8288 Remmat Ave..P.O.Boat 7184-Caoopa Pane.CA 9130-7184 Prod.No.5907 Reorder:Cal Tog Free 1.804E75-68Z7 • n -CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT fbfgjA State of �l.� County of anT_ On_I�Lt_"J" &j tr b before me, �d'U �S"�, �nb-eq ( ".71ct au. �"''arq T►ne a oroaf a s,-►.�.aoe,f4gary PuOGC) personally appeared- Namels)of s9rWgB) impersonally known to me--OR—E proved tome-orrtf-L t sis of satisfactory evidence to be the persona whose name[)subscribed to the within instrument and acknowledged to me that ihekh4lZfley xecuted the same in e1 uthorized capacity,and that by tistef4G1 ignatuT0s on the Instrument the peroor(m WIZAA WtSoN t or the entity upon behalf of which the persor(oacted, CommiWon#t OW63 z executed the instrument. Q'01W iNotofy PLWc—collomia f.ORANGE COUNvttr WITNESS my hand and official seat. Comm.ExOrss h12J,IM S."t wo of Nmry Pa)w PTIaNAL Though the lr7formation below Is rot required by law,it mayprove valuable to persons retying on the document and Gould prevent framiulent removal and reattachment of this form to another document. Description of Attached Document TiVe or Type of Document: »' �J�G z°6ywl ����Z�i ��� � r Lk"15V ►� Document Date: I I i�1�1 Number of Pages: t Signer(s)Other Than Named Above: :&0Cxfilrc..Dtrecfv,- m) lbcx-�dC.83 rjs' N,Zct,vt.F T. Ube{,ar Capacity(ies) Claimed by Signer(s) �Q r✓ u l l t tra r'1 Signer's Name: S Signer's Name: C Individual ❑ Individual ❑ Corporate Officer ❑ Corporate Officer Title(s): Title(s): ❑ Partner—❑ Limited O General C Partner—❑Umited ❑General ❑ Attorney-in-Fact ❑ Attomeyin-Fact ❑ Trustee ❑ Trustee D Guardian or Conservator - - ❑ Guardian r Conservator ` IS Other: Ch 'l rm&P, Top of tnumb here $a Other. % " i Top or tnumn Here Signer Is Representing: Signer Is Representing: tr l.2,VY. fJrylt rtil ,-1A Q 1994 Na'and Wary AsaoeiaGon•GM RMmMt Ave..P.O.Box 7104 Cvvp P&A.CA 91309.7194 Pmd.No.5W Re~..Caa Tol-Froe 1-KG-87S-6W r Exhibit "A" Legal Description 17422 Queens Lane Lot 14'of Tract No.4153,in tl•.c Agency of 11.1uMingtoa Beach,Cou..ty of Orange,State of California,as per map recorded in Book 174,pages 12 and 13 of miscellaneous maps,in the office the County Recorder of said county,except all subsurface water,as dedicated on the map of the Tract and as conveyed to the Agency of Huntington Beach in deed recorded Febry oy 20, 1963 in book 64I8,page 408 of official records,without the right of entry to the surface and subsurface area to a depth of 500 feet for the purpose of producing water. i f 3 ' Page 1 of 4\k',AUcC'Queens:AVach4l1 I M4196 RLS 96-758 d • REQUEST FOR CITY COUNCIL/REDEVELOPMENT AGENCY ACTION MEETING DATE: 11/18196 DEPARTMENT ID NUMBER: ED 96-03 Because of OCCHC's involvement, one family occupies each unit and will pay 30% of their income, or$450, whichever is higher. The Agency's involvement with the HOME Program is consistent with the City Council's established goal of providing for a diverse housing stock throughout the community (City Goal#8). nvironmental_Status: Categorically exempt under the National Environmental Protection Act (NEPA). A achtnmW: List attachment(s) below. City Clerk's •g- Nuimber No. Description Start Numbering 1. City to Agency Committment Agreement 2. Loan Agreement with OCCHC 3. Location Map: 17422 & 17432 Queens lane 4. OCCHC Pro Forma 5. Deal Point Summary 6. Agency Action from June 3, 1996 h'.TU:DCB:G B:gb:ee MAIM= -4- 11/06M 2:49 PM CITY OF HUNTINGTON BEACH COMMITMENT OF FUNDS AGREEMENT BETWEEN THE CITY OF HUNTINGTON BEACH AND THE HUNTINGTON BEACH REDEVELOPMENT AGENCY This Commitment of Funds Agreement(the"Agreement'), is made this 1LN day of 1996, by and between the City of funtington Beach,a municipal corporation("City'),and the Redevelopment Agency of the City of Iuntington Beach,a body politic of the State of California,organized and existing under the Community Redevelopment Law of the State of California("Agency'). RECITALS A. City wishes to expand the supply of decent, safe,sanitary and affordable housing, with primary attention to rental housing, for very-low income and low income residents in the City of Huntington Beach. B. City has received HOME Investment Partnership Program funds in the amount of Ninety Thousand Eight Hundred Dollars($90,800.00) from the United States Department of Housing and Urban Development pursuant to the National Affordable I lousing Act of 1990 for the purpose of expanding the supply of decent,safe,sanitary and affordable housing for very-low and low income persons and families(hereinafter,the"Funds") C. Agency proposes to acquire and rehabilitate certain real property and/or improvements located in the City of Huntington Beach, California(as more particularly described in Exhibit A and hereinaftger referred to as the"Property")and carry out on the Property eligible activities permitted under the HOME Regulations to provide housing affordable to low-income and very-low income households as defined in this Agreement,(hereinafter referred to as the"Project"). D. Agency wishes to receive from City,and City wishes to make available to Agency,the Funds to support development of the Project. NOW,THEREFORE,IN CONSIDERATION of the mutual agreements,obligations,and representations,and in further consideration for the provision of HOME funds, RDA and City hereby agree as follows: 1 PDAAJAgrec/Qucens/Rcsvfund RLS 96-758-11/4,196 ARTICLE 1. DEFINITIONS The following terms have the meanings and content set forth in this section wherever used in this Agreement. 1.1 "Eligible Activities"means permitted use of the Funds pursuant to the HOME Regulations. 1.2 "Funds" means the funds provided to Agency by City pursuant to this Agreement. 1.3 "HOME Regulations"means all requirements imposed on projects assisted under the Home Investment Partnership Program as contained in 42 U.S.C. Sections 12701, et seq., and Part 92 of Title 24 of the Code of Federal Regulations and other implementing rules and regulations. 1.4 "HUD"means the United States Department of Housing and Urban Development. 1.5 "Low income Household" means a household whose annual income does not exceed eighty percent{8(%)of the median income for Orange County as determined by HUD with adjustments for household size. 1.6 "Project" is the acquisition of the Property and the construction or rehabilitation of certain improvements thereon or the administration or implementation of any other eligible activity to provide housing affordable to persons or families of very low-income and low-income according to the terms of this Agreement. 1.7 "Regulatory Agreement"means the agreement executed by Agency or an eligible third party and the City in a form satisfactory to City and recorded against the Property prior to or contemporaneously with the payment of the Funds which regulates, among other things, the operation, leasing, tenant selection, income certification, affordability restrictions, continuing occupancy requirements and maximum rental charges of the property. 1.9 "Very Low Income Household" means a household whose annual income does not exceed fifty percent (50%) of the median income for Orange County as determined by HUD with adjustments for household size. ARTICLE 2. USE OF FUNDS 2.1 COMMITMENT OF FUNDS. Pursuant to this Agreement, Agency shall use the Funds for the Project. The Agency shall expend the Funds by no later than June 27, 1999. 2.2 AMOUNT OF HOME FUNDS. On and subject to the terms and conditions of this Agreement, City agrees to provide Agency and Agency agrees to accept HOME Funds in 2 YQ.1 WAgren"Queern 1wvfund RLS 96-758.1MUM an amount not less than Three Hundred Ninety-nine Thousand Two Hundred and no/100 Dollars ($399,200.00),which shall be used for the Project. 2.3 REGULATORY AGREEMENT. As a condition of the provision of the Funds, Agency shall execute(or cause to be executed by an assignee), among other things, a regulatory agreement which shall be recorded against any property acquired with the Funds. The regulatory agreement is to secure City's continuing interest in the affordability and habitability of the housing contained in this Agreement and the regulatory agreement. ARTICLE 3. EMPLOYMENT 3.1 PREVAILING WAGES. All projects for new construction or rehabilitation of affordable housing with 12 or more units assisted with HOME Funds shall comply with HUD requirements pertaining to such contracts and the applicable requirements of the regulations of the Department of Labor governing the payment of wages and the ratio of apprentices and trainees to journeymen. However, nothing in this section is intended to relieve the Agency or any contractor/subcontractor of any obligation for payment of higher rates if required by State or local law. ARTICLE 4. GENERAL PROVISIONS 4.1 NOTICES,DEMANDS AND COININIUNICATIONS. Formal notices, demands and communications between Agency and City shall be sufficiently given and shall not be deemed given unless dispatched by registered or certified mail, postage prepaid, return receipt requested, or delivered personally, to the principal offices of Agency and City as follows: CITY: City of Huntington Beach Department of Economic Development 2000 Main Street Huntington Beach, CA 92648 Attn: City Administrator AGENCY: Redevelopment Agency of the City of Huntington Beach 2000 Main Street Huntington Beach, CA 92648 Attn: Executive Director 4.2 INTEGRATION. This Agreement constitutes the entire agreement of the parties and supersedes any all prior negotiations. 4.3 AMENDMENTS AND MODIFICATIONS. Any amendments or modifications to this Agreement must be in writing, and shall be made only if executed by both 3HC and City. 3 PDAVAVV9VU a WR=Vfi4A RIS 9&738.IM96 IN WITNESS WHEREOF, the parties hereby have executed this Agreement as of the date first above written. AGENCY: CITY: REDEVELOPMENT AGENCY OF CITY OF HUNTINGTON BEACH, THE CITY OF HUNTINGTON BEACH a municipal corporation of the State of California Mayor -:j)Av E SkL.L =V'AN SCcLc.rVflN (print name) ATTEST: Its: C 1414=R MAN a�z� ATTEST: City Clerk APPROVED AS TO FORM: Clerk `( -f���l/b City Attorney J-e,ulbltb REVIEWE AND APPROVED: INITIATED AND APPROVED: City Administrator Di ector of Economic Development 4 PDAWAgredQum,/Rwvfund RIS 96-759-10/23/96 Exhibit "A" Property HOME funds awarded under this Agreement will only be used for the acquisition and rehabilitation of multifanuly rental properties. The order of priority for the targeting of these funds to specific areas is as follows: t. Redevelopment Project Areas • Oakview • Main-Pier • Talbert-Beach 2. CDBG and HOME neighborhood enhancement areas (not listed in priority order) • Oakview • Amberleaf Circle • Florida-Utica • Beach-Garfield • Newland • Washington • Liberty 3. Citywide PDA VA9ftVueem'Reavruadb AIS 96-759-10r231% t i Attachment No. 2 PROMISSORY NOTE SECURED BY DEED OF TRUST (17422 Queens Lane) $ 238,000.00 DATE: December 26, 1996 FOR VALUE RECEIVED,Orange County Community Housing Corporation,a California nonprofit public benefit corporation,whose address is 1833 E. 17th Street, Santa Ana, California 9270I ("Borrower")hereby promises to pay to the order of the Redevelopment Agency of the City of Huntington Beach,a public body,whose address is 2000 Main Street, Huntington Beach, California, 92648 ("Lender"),a principal amount equal to ($ ),or so much thereof as may be advanced by Lender to Borrower(the "Loan") pursuant to a loan agreement of even date herewith between Borrower and Lender(the "Loan Agreement"). Borrower also promises to pay to the order of Lender accrued simple interest on the principal balance at the rate of six percent(6%)per annum. 1. BORROWER'S OBLIGATION. This Note evidences the obligation of Borrower to Lender for the repayment of funds loaned to Borrower by Lender to finance the expenses related to the development of the housing project in the City of Huntington Beach described in the Loan Agreement. 2. SECURITY. This Note is secured by a deed of trust executed by the Borrower in favor of the Lender dated the same date as this Note,(the "Deed of Trust"). 3. REPAYMENT OF NOTE. The principal balance under this Note and all interest accrued thereon shall be due and payable thirty (30)years after execution of this Note,or in the event of an Event of Default by Borrower which has not been cured as provided for in the Loan Documents or Regulating Agreement. The Lender may choose, in its sole discretion,whether or not to renegotiate this note in the thirtieth(30th)year to extend the affordability period and the term of this note. There may be periodic payments under this Note. Commencing on the fifth(5th) anniversary of the Close of Escrow and continuing until the thirtieth(30th)anniversary of the Close of Escrow,the Borrower shall make minimum annual payments(the"Annual Paymenf') in the amount of One Thousand Two Hundred Dollars($1,200.00). Each Annual Payment shall be due annually on each anniversary of the Close of Escrow beginning on the fifth(5th) anniversary of the Close of Escrow and continuing and including the thirtieth(30th)anniversary of the Close of Escrow;provided,however,that remaining outstanding principal of the Loan shall be repaid on the thirtieth(30th)anniversary of the Close of Escrow. 1f the balance of the Attachment'No. 2 Pagel of 4 41%Agmc/Quccns1Attach2 RLS 96-759-1 114196 a I ti Residual Receipts account is insufficient to fully fund an Annual Payment,Borrower agrees to make-up any shortfall that may exist in the account so that the Annual Payment can be made. Borrower may request that the Lender reduce,suspend or forgive an Annual Payment,and the Borrower may present evidence to the Lender of its inability to make an Annual Payment; however,Lender reserves the exclusive right in its sole discretion to reduce,suspend or forgive an Annual Payment. All principal and interest on the Loan shall be due in full upon the earliest to occur of. (1) the occurrence of a default under this Note,the ITOME Loan Agreement, the Deed of Trust,or the Agreement Containing Covenants,which event of default is not cured within the applicable cure period; or (2) the thirtieth(30th)anniversary of Close of Escrow. 4. PLACE AND MANNER OF PAYMENT. All amounts due and payable under this Note are payable at the office of Lender as set forth above,or at such other place as Lender may designate to Borrower in writing from time to time, in any coin or currency of the United States which on the respective dates of payment thereof shall be legal tender for the payment of public and private debts. 5. WAIVERS. Presentment,notice of dishonor,and protest are waived by all makers,sureties, guarantors,and endorsers of this Note. 6. DEFAULT AND ACCELERATION. All covenants,conditions and agreements contained in the Deed of Trust,Regulatory Agreement and the Loan Agreement are hereby made a part of this Note. Borrower agrees that the unpaid balance of the then principal amount of this Note,together with all accrued interest thereon and charges owing, shall, at the option of Lender,become immediately due and payable upon any Event of Default as defined in the Loan Agreement which has not been cured pursuant to that agreement, including without limitation the failure of Borrower to make any payment when due. Upon any Event of Default, Lender may exercise any other right or remedy permitted under the Loan Documents. 7. NONRECOURSE. This Loan is a nonrecourse obligation of Borrower. The sole recourse of Lender for repayment of the principal and interest under this Note shall be the exercise of Lenders rights against the Property. 8. CONSENTS AND APPROVALS. Any consent or approval of Lender required under this Note shall not be unreasonably withheld. Attachment No.2 Page 2 of 4 4WAgrce/Qu"ns/Attach2 RLS 96-753-11/4196 r 9. NOTICES. Except as may be otherwise specifically provided herein,any approval,notice,direction, consent request or other action by Lender shall be in writing and may be communicated to Borrower at the principal office of Borrower set forth above,or at such other place or places as Borrower shall designate in writing, from time to time,for the receipt of communications from Lender. 10. BINDING UPON SUCCESSORS. All provisions of this Note shall be binding upon and inure to the ben-.fit of the heirs,administrators,executors,successors-in-interest, transferees,and assigns of Borrower and Lender;provided,however,that this section does not waive the prohibition in the Loan Agreement on assignment of the Loan by Borrower without Lender's consent. 11. ASSIGNMENT AND ASSUMPTION. Borrower shall not assign any of its interests under this Note to any other party,except as specifically permitted under the terms of the Loan Documents,without the prior written consent of Lender. Any unauthorized assignment shall be void. 12. DEFINITIONS. Capitalized terms not defined in this Note shall have the same meaning as defined terms in the Loan Agreement. 13. GOVERNING LAW. This Note shall be interpreted under and governed by the laws of the State of California,except for those provisions relating to choice of law and those provisions preempted by federal law. 14. LOAN AGREEMENT CONTROLS. In the event that any provisions of this Note and the Loan Agreement conflict,the terms of the Loan Agreement shall control. 15. SEVERABILITY. Every provision of this Note is intended to be severable. If any provision of this Note shall be held invalid, illegal,or unenforceable by a court of competent jurisdiction,the validity,legality,and enforceability of the remaining provisions shall not in any way be affected or impaired. 16. ATTORNEYS'FEES AND COSTS. In the event of any legal action is commenced to interpret or to enforce the terms of this Note,each party shall bear its own costs and attorneys' fees. The prevailing party in any such action shall not be entitled to recover any attorneys'fees and costs incurred in such action. 17. WAIVER. Any waiver by Lender of any obligation in this Note must be in writing. No waiver shall be implied from any failure of Borrower to take,or any delay or failure by Lender to take action on any breach or default by Borrower or to pursue any remedy allowed under this Note or applicable law. Any extension of time granted to Borrower to perform any obligation under this Note shall not operate as a waiver or release from any of its obligations Attachment No. 2 Page 3 of 4 4`1M&rcc/QuKns/Attach2 RLS 96-758-1114,96 under the Note. Borrower hereby waives all defenses and pleas on the grounds of any extensions of the time for repayment of any amounts due under this Note,unless Lender has granted such extensions in writing. Consent by Lender to any act or omission by Borrower shall not be construed to be a consent to any other act or omission or to%vaive the requirement for Lender's ,.s7itten consent to future waivers. 18. AMENDMENTS AND MODIFICATIONS. Any amendments or modifications to this Note must be in v-riting,and shall be made only if executed by both Borrower and Lender. Executed at Huntington Beach,California,on December 26, 1996 . 1996 BORROWER: Orange County Community Housing Corporation,a California nonprofit benefit corporation By: 2 Pe- Its: c, By: Its: Attachment No.2 Page 4 of 4 d,k\AgredQucc ns1Anach2 RLS 96.759-11/4196 Attachment No.2A PROMISSORY NOTE SECURED BY DEED OF TRUST �. (17432 Quecns Lane) $ 252,000.00 DATE: December 26, 1996 FOR VALUE RECEIVED, Orange County Community Housing Corporation,a California nonprofit public benefit corporation,whose address is 1833 E. 17th Street,Santa Ana, California 92701 ("Borrower")hereby promises to pay to the order of the Redevelopment Agency of the City of Huntington Beach,a public body,whose address is 2000 Main Street Huntington Beach, California, 92648("Lender"),a principal amount equal to Two hundred Fifty-two thousand ($ LSL�,or so much thereof as may be advanced by Lender to Borrower(the "Loan') pursuant to a loan agreement of even date herewith between Borrower and Lender(the"Loan Agreement"). Borrower also promises to pay to the order of Lender accrued simple interest on the principal balance at the rate of six percent(6%)per annum. 1. BORROWER'S OBLIGATION. This Note evidences the obligation of Borrower to Lender for the repayment of funds loaned to Borrower by Lender to finance the expenses related to the development of the housing project in the City of Huntington Beach described in the Loan Agreement. , 2. SECURITY. This Note is secured by a deed of trust executed by the Borrower in favor of the Lender dated the same date as this Note,(the"Deed of Trust"). 3. REPAYMENT OF NOTE. The principal balance under this Note and all interest accrued thereon shall be due and payable thirty(30)years after execution of this Note,or in the event of an Event of Default by Borrower which has not been cured as provided for in the Loan Documents or Regulating Agreement. The Lender may choose,in its sale discretion,whether or not to renegotiate this note in the thirtieth(30th)year to extend the affordability period and the term of this note. There may be periodic payments under this Note. Commencing on the fifth(5th) anniversary of the Close of Escrow and continuing until the thirtieth(30th)anniversary of the Close of Escrow,the Borrower shall make minimum a-usual payments(the"Annual Paymenf) in the amount of One Thousand Two Hundred Dollars($1,200.00). Each Annual Payment shall be due annually on each anniversary of the Close of Escrow beginning on the fifth(5th) anniversary of the Close of Escrow and continuing and including the thirtieth(30th)anniversary of the Close of Escrow;provided,however,that remaining outstanding principal of the Loan shall be repaid on the thirtieth(30th)anniversary of the Close of Escrow. If the balance of the Attachment No. 2A Page 1 of 4 4WAgrcdQu"rWAn=h2 RIS 96-758.1114N6 Residual Receipts account is insufficient to fully fund an Annual Payment,Borrower agrees to make-up any shortfall that may exist in the account so that the Annual Payment can be made. Borrower may request that the Lender reduce,suspend or forgive an Annual Payment,and the Borrower may present evidence to the Lender of its inability to make an Annual Payment; however,Lender reserves the exclusive right in its sole discretion to reduce,suspend or forgive an Annual Payment. All principal and interest on the Loan shall be due in full upon the earliest to occur of: (1) the occurrence of a default under this Note,the HOME Loan Agreement, the Deed of Trust,or the Agreement Containing Covenants,which event of default is not cured within the applicable cure period;or (2) the tldrtieth(30th)anniversary of Close of Escrow. 4. PLACE AND MANNER OF PAYMENT. All amounts due and payable under this Note are payable at the office of Lender as set forth above,or at such other place as Lender may designate to Borrower in writing from time to time,in any coin or currency of the United States which on the respective dates of payment thereof shall be legal tender for the payment of public and private debts. 5. WAIVERS. Presentment,notice of dishonor,and protest are waived by all makers, sureties,guarantors,and endorsers of this Note. 6. DEFAULT AND ACCELERATION. All covenants,conditions and agreements contained in the Deed of Trust,Regulatory Agreement and the Loan Agreement are hereby made a part of this Note. Borrower agrees that the unpaid balance of the then principal amount of this Note,together with all accrued interest thereon and charges owing,shall,at the option of Lender,become immediately due and payable upon any Event of Default as defined in the Loan Agreement which has not been cured pursuant to that agreement,including without limitation the failure of Borrower to make any payment when due. Upon any Event of Default,Lender may exercise any other right or remedy permitted under the Loan Documents. 7. NONRECOURSE. This Loan is a nonrecourse obligation of Borrower. The sole recourse of Lender for repayment of the principal and interest under this Note shall be the exercise of Lender's rights against the Property. 8. CONSENTS AND APPROVALS. Any consent or approval of Lender required under this Note shall not be unreasonably withheld. Attachment No.2A Page 2 of 4 aU 1Agrcc/Queens/Attach2 V S 96-758-1114196 z 9. NOTICES. Except as may be otherwise specifically provided herein,any approval,notice,direction, consent request or other action by Lender shall be in writing and may be communicated to Borrower at the principal office of Borrower set forth above,or at such other place or places as Borrower shall designate in writing,from time to time,for the receipt of communications from Lender. 14. BINDING UPON SUCCESSORS. All provisions of this Note shall be binding upon and inure to the benefit of the heirs,administrators,executors,successors-in-interest, transferees, and assigns of Borrower and Lender;provided,however,that this section does not waive the prohibition in the Loan Agreement on assignment of the Loan by Borrower without Lender's consent. 11. ASSIGNMENT AND ASSUMPTION. Borrower shall not assign any of its interests under this Note to any other party,except as specifically permitted under the terms of the Loan Documents,without the prior written consent of Lender. Any unauthorized assignment shall be void. 12. DEFINITIONS. Capitalized terms not defined in this Note shall have the same meaning as defined terms in the Loan Agreement. 13. GOVERNING LAW. This Note shall be interpreted under and governed by the laws of the State of California,except for those provisions relating to choice of law and those provisions preempted by federal law. r 14. LOAN AGREEMENT CONTROLS. In the event that any provisions of this Note and the Loan Agreement conflict,the terms of the Loan Agreement shall control. 15. SEVERABILITY. Every provision of this Note is intended to be severable. If any provision of this Note shall be held invalid,illegal,or unenforceable by a court of competent jurisdiction,the validity, legality,and enforceability of the remaining provisions shall not in any way be affected or impaired. 16. ATTORNEYS' FEES AND COSTS. In the event of any legal action is commenced to interpret or to enforce the terms of this Note,each party shall bear its own costs and attorneys' fees. The prevailing party in any such action shall not be entitled to recover any attorneys' fees and costs incurred in such action. 17. WAIVER. Any waiver by Lender of any obligation in this Note must be in writing. No waiver shall be implied from any failure of Borrower to take,or any delay or failure by Lender to take action on any breach or default by Borrower or to pursue any remedy allowed under this Note or applicably:law. Any extension of time granted to Borrower to perform any obligation under this Note shall not operate as a waiver or release from any of its obligations Attachment No.2A Page 3 of 4 411v1AgretlQuttns/A11ach2 R L S 96-758-11!4/96 under the Note. Borrower hereby waives all defenses and pleas on the grounds of any extensions of the time for repayment of any amounts due under this Note,unless Lender has granted such extensions in writing. Consent by Lender to any act or omission by Borrower shall not be construed to be a consent to any other act or omission or to v"-aive the requirement for Lender's written consent to future waivers. 18. AMENDMENTS AND MODIFICATIONS. Any amendments or modifications to this Note must be in%%Titing,and shall be made only if executed by both Borrower and Lender. December 26 Executed at Huntington Beach, California,on _ 1996 , 1996. BORROWER: Orange County Community Housing Corporation,a California nonprofit benefit corporation By: ( , Its: Sec��c?1 By: a Its: Attachment No.2A Page 4 of 4 41k1AgmWQuv:WAnach2 R[S 96-758-1114196 �r l r' RECORDING REQUESTED of Orange, Galiforrlia RYg'I'EWART gecoroea in the Cy1etyCterk/Recorder Garry ; . No Fee NO FEE DOCUMENT 1�°111 �11�111�a11111.1..1.1.11 ,111..�1t , 12131M ,9ARM � When recorded,mail to: Di l ti 36 $0 s 15 1. pit A36 502 14 2 3 39.00 0.00 0,00 0,00 0.00 0.00 City of Huntington Beach 2000 Main Street Huntington Beach, CA 92648 Attention: Office of City Clerk c� G aQ or'-tn Qn c:-t e- n C3 en r" }.. v--,3 O VK DEED OF TRUST,ASSIGNMENT OF RENTS, i AND SECURITY AGREEMENT T :n (Securing loan of$ 238,000.00 ) 5r ,_. 4P THIS DEED OF TRUST,ASSIGNMENT OF RENTS,AND SECURITY AGREEMENT("Deed of Trust") is made this 26th day of December . 1996,by Orange County Community Housing Corporation,a California nonprofit public benefit corporation("Trustor"),to Stewart Title Company as trustee("Trustee"),for the benefit of the Redevelopment Agency of the City of Huntington Beach, a public body("Beneficiary"). GRANT IN TRUST 1. GRANT. Trustor, in consideration of the indebtedness referred to below,hereby irrevocably grants and conveys to Trustee, IN TRUST, WITH POWER OF SALE, for the benefit and security of Beneficiary,all of Trustor's interest in the property located in the City of Huntington Beach, County of Orange,State of California,and described in the attached Exhibit A,incorporated herein by this reference(the "Property"); TOGETHER WITII all interest,estates or other claims,both in law and in equity which Trustor now has or may hereafter acquire in the Property;all buildings, structures, fixtures, improvements,signs,and landscaping now or hereafter erected or located on the Property, including all equipment and machinery Used for supplying or distributing heating,cooling, electricity,gas,water,air,and light,all kitchen and laundry appliances such as washers,dryers, refrigerators, garbage disposals,ovens, ranges,dishwashers,all plumbing and bathroom fixtures, all security and access control equipment, fire prevention and extinguishment equipment, elevators, floor coverings,window coverings,paneling,cabinets, (provided,however,that Attachment No.3 Page I of 12 41k1G:Agrcc:Qucens:Attach3111/496 RLS 9"58 r Trustor shall have the right to remove,if necessary, such fixtures,furnishings,and equipment for the purpose of replacement with similar items of the same quality performing the same functions, which replacements shall themselves become part of this grant);all building material and equipment either now or hereafter delivered to the Property and intended to be installed therein or any such material and equipment purchased with Loan proceeds whether or not located on the Property;all reserves,accounts,deferred payments, and refunds relating to development on the Property;all rents and income generated by the Property or improvements thereon(subject however to the assignment of rents to Lender contained herein); all leases,subleases and rental agreements covering the Property or any portion thereof now existing or hereafter entered into, and all interests of Trustor in security deposits,advance rentals, accounts, or payments of similar nature with respect to such leases,subleases,or rental agreements;all easements and rights-of- way appurtenant to the Property, including parking and recreational easements,and all interests of Trustor in any land lying within the right-of-way of any street, sidewalks,and areas of land adjacent to or used in connection with the Property;all development rights and credits,air rights, water rights,and oil,gas or mineral rights with respect to the Property;all claims or demands with respect to insurance proceeds,and all awards made for a taking by eminent domain;all interests and rights in any private or goverment grants,subsidies, loans,or other financing w7th respect to development on the Property; all interests in personal property used in and about the Property (except furniture and other personal property of occupants of dwelling units on the Property);all intangible property and rights relating to the Property or operations on the Property, including trade names,goodwill,trademarks,and service marks; all government permits,approvals,and map rights related to construction on the Property;all architectural, structural,and mechanical plans, specifications,designs, studies,and data with respect to construction of improvements on the Property;all environmental tests, studies and reports with respect to the Property;all current and future claims and rights of action of Trustor against prior owners and operators of the Property,neighboring property owners and operators,tenants and former tenants,consultant.,advisors,and other third parties with respect to environmental or Hazardous Materials contamination and cleanup of the Property under any federal,state,or local ordinances,statutes,regulations, or administrative decisions or common law. All of the foregoing,together with the Property, is herein referred to as the "Security." OBLIGATIONS SECURED 2. Trustor makes this grant for the purpose of securing the following obligations: A. Repayment of the indebtedness of Trustor to Beneficiary in the principal sum of Two hundred Thirty-eight- Dollars($ 238.00o.00)with interest thereon{the i by a promissory note executed by Trustor(the "Note"),on file at the offices of Beneficiary,which is hereby incorporated into this Deed of Trust Attachment No.3 Page 2 of 12 4,k%G:Agrce:Queens:Anach3111/4/96 RLS 9"58 t by this reference)or as much as has been disbursed to Trustor therewith, along with any extensions,amendments,modifications,or renewals to the Note; and B. Payment of any sums advanced by Beneficiary to protect the security and priority of this Deed of Trust;and C. Payment of any sums advanced by Beneficiary following a breach of Trustoes obligation to advance said sums and the expiration of any applicable cure period, with interest thereon as provided herein;and D. Performance of every obligation,covenant or agreement of Trustor contained in this Deed of Trust,the Note,the Loan Agreement executed between Trustor and Beneficiary,on file at the offices of Beneficiary,which is hereby incorporated into this Deed of Trust by this reference),and the Regulatory Agreement executed between Trustor and Beneficiary of dated the same day as this Deed of Trust ("Regulatory Agreement"), including all modifications,extensions and renewals of these obligations;and E. Performance of any other obligation or repayment of any other indebtedness of Trustor to Beneficiary,where such evidence of obligation or indebtedness specifically recites that it is secured by this Deed of Trust. ABSOLUTE ASSIGNMENT OF RUM AND RIGHT TO POSSESSION 3. ASSIGNMENT. As additional security,Trustor hereby assigns to Beneficiary: (a)all of the rents,revenues,profits,and income from the Security,any deposits now or hereafter in Trustor s possession which have been collected with respect to the Security, and any reserve or capital funds now or hereafter held by Trustor with respect to construction or operation of the Security(collectively,the "Rents");and(b)the right to enter,take possession of,and manage the Security;provided however that Trustor shall have,before an Event of Default,the exclusive right to possess the Security and to collect Rents and use them in accordance with the Loan Documents. This assignment is intended to be an absolute and present transfer of Trustor's interest in existing and future Rents,effective as of the date of this Deed of Trust. 4. ENFORCEMENT. Upon the happening of an Event of Default and written notice to Trustor,Beneficiary may, in addition to other rights and remedies permitted by the Loan Agreement,this Deed of Trust,or applicable law,(a)enter upon,take possession of,and manage the Security,either in person as a mortgagee-in-possession,by agent,or by a receiver appointed by a court,and do any acts which it deems necessary or desirable to preserve the value, marketability or rentability of the Security,(b)collect all Rents, including those past due and unpaid, and apply the same to pay for the costs and expenses of operation of the Security, Attachment No.3 Page 3 of 12 "-',G:Agrce:Quccns:Aetach3111/4/96 RLS 9"58 1' _t including attorneys' fees,and pay off any indebtedness secured by this Deed of Trust,all in such order as Beneficiary may determine,and/or(c)enter upon and take possession of the Security. Beneficiary may make,cancel,enforce,and modify leases and rental agreements,obtain and evict tenants,set and modify rent terms,sue for rent due,enter into,modify,or terminate any contracts or agreements,or take any legal action,as it deems necessary with respect to the Rents or to development or operation of the Security. 5. APPOINTMENT OF A RECEIVER. In any action to enforce this assignment, Beneficiary may apply for the appointment of a receiver to take possession of the Security and take whatever measures are necessary to preserve and manage the Security for the benefit of Beneficiary and the public interest. Trustor hereby consents to the appointment of a receiver. The receiver shall have all of the authority over the Security that Beneficiary would have if Beneficiary took possession of the Security under this assignment as a mortgagee-in-possession, including the right to collect and apply Rents and the right to complete construction of improvements. 6. NO WAIVER OF POWER OF SALE. The entering upon and taking possession of the Security and the collection of Rents shall not cure or waive any default or notice of default hereunder or invalidate any act done in response to such default or notice of default and, notwithstanding the continuance in possession of the Security or the collection and application of Rents,Beneficiary shall be entitled to exercise every right provided for in this Deed of Trust or by law upon occurrence of any Event of Default, including the right to exercise the power of sale. COMMERCIAL CODE SECURITY AGREEMENT 7. GRANT. This Deed of Trust is intended to be a security agreement and financing statement pursuant to the California Commercial Code for any of the items specified above as part of the Security which under applicable law may be subject to a security interest pursuant to the Commercial Code,and Trustor hereby grants Beneficiary a security interest in said items. Beneficiary may file a copy of this Deed of Trust in the real estate records or other appropriate index as a financing statement for any of the items specified as part of the Security. Trustor shall execute and deliver to Beneficiary at Beneficiary's request any financing statements,as well as extensions,renewals,and amendments thereof,and copies of this instrument in such form as Beneficiary may require to perfect a security interest with respect to said items. S. REMEDIES. Upon Trustoes breach of any obligation or agreement in the Loan Documents,Beneficiary shall have the remedies of a secured party under the Commercial Code and at Beneficiary's option may also invoke the remedies provided for elsewhere in this Deed of Trust with respect to said items. Beneficiary may proceed against the items of real property and personal property specified above separately or together and in any order whatsoever. Attachment No.3 Page 4 of 12 41,k%G:Agrce:Quccns:Anach3111/4N96 RLS 9M59 e RIGHTS AND OBLIGATIQNS OF TRUSTOR 9. PERFORMANCE OF SECURED OBLIGATION. Trustor shall promptly perform each obligation secured by this Deed of Trust. 10. PAYMENT OF PRINCIPAL AND INTEREST. Trustor shall promptly pay when due the principal and interest on the indebtedness evidenced by the Note. 11. MAINTENANCE OF THE SECURITY.Trustor shall,at the Trustor's own expense,maintain and preserve the Security or cause the Security to be maintained and preserved in good condition, in good repair,and in a decent,safe,sanitary,habitable and tenantable condition. Trustor shall not cause or permit any violations of any laws,ordinances,regulations, covenants,conditions,restrictions,or equitable servitudes as they pertain to improvements, alterations, maintenance or demolition on the Security. Trustor shall not commit or permit waste on or to the Security. Trustor shall not abandon the Security. Beneficiary shall have no responsibility over maintenance of the Security. In the event Trustor fails to maintain the Security in accordance with the standards in this Deed of Trust,the Loan Agreement,or the Regulatory Agreement, Beneficiary,after at least thirty(30)calendar days prior notice to Trustor,may,but shall be under no obligation to,m4ke such repairs or replacements as are necessary and provide for payment thereof. Any amount so advanced by Beneficiary,together with interest thereon from the date of such advance at the same rate of indebtedness as specified in the Note(unless payment of such an interest rate would be contrary to applicable law, in which event such sums shall bear interest at the highest rate then allowed by applicable law), shall become an additional obligation of Trustor to Beneficiary and shall be secured by this Deed of Trust. 12. INSPECTION OF THE SECURITY. Trustor shall permit Beneficiary to enter and inspect the Security for compliance with these obligations upon 24 hours advance written notice of such visit by Beneficiary to Trustor or Trustoi s management agent. 13. LIENS,ENCUMBRANCES,AND CHARGES. Trustor shall discharge any lien or encumbrance not approved by Trustor in writing that may attain priority over this Deed of Trust,as provided for in the Loan Agreement. 14. DEFENSE AND NOTICE OF CLAIMS AND ACTIONS. Trustor shall appear in and defend,at its own expense,any action or proceeding purporting to affect the Security and/or the rights of Beneficiary. Trustor shall give Beneficiary and Trustee prompt notice in writing of the assertion of any claim, of the filing of any action or proceeding and of any condemnation offer or action with respect to the Security. Attachment No.3 Page So f 12 41k1G:Agrcc:Quccns:At1ach3\11/4196 RkS 96-858 e 15. SUITS TO PROTECT THE SECURITY. Beneficiary shall have power to institute and maintain such suits and proceedings as it may deem expedient(a)to prevent any impairment of the Security or the rights of Beneficiary,(b)to preserve or protect its interest in the Security and in the Rents,and(c)to restrain the enforcement of or compliance with any governmental legislation,regulation,or order,if th.-enforcement of or compliance with such legislation,regulation,or order would impair the Security or be prejudicial to the interest of Beneficiary. 16. DAMAGE;TO SECURITY. Trustor shall give Beneficiary and Trustee prompt notice in writing of any damage to the Security. If any building or improvements erected on the Property is damaged or destroyed by an insurable cause,Trustor shall use the insurance proceeds to repair or restore said buildings and improvements consistent with the original plans and specifications. Such work or repair shall be commenced mithin 120 days after the damage or Ioss occurs and shall be complete within one year thereafter. All insurance proceeds collected for such damage or destruction shall be applied to the cost of such repairs or restoration. 17. TITLE. Trustor warrants that Trustor lawfully has legal title to the Security without any limitation on the right to encumber. 18. GRANTING OF EASEMENTS. Tmtor may not grant easements,licenses, rights-of-way or other rights or privileges in the nature of easements with respect to the Security except those required or desirable for installation and maintenance of public utilities including water, gas,electricity, sewer,cable television,telephone,or those required by Iaw. 19. TAXES AND LEVIES. Trustor shall pay prior to delinquency,all taxes, fees, assessments,charges and levies imposed by any public authority or utility company which are or may become a lien affecting the Security. However,Trustor shall not be required to pay and discharge any such tax,assessment,charge or levy so long as(a)the legality thereof shall be promptly and actively contested in good faith and by appropriate proceedings,and(b)Trustor maintains reserves adequate to pay any contested liabilities. In the event that Trustor fails to pay any of the foregoing items, Beneficiary may,but shall be under no obligation to,pay the same, after Beneficiary has notified Trustor of such failure to pay and Trustor fails to fully pay such items within thirty(30)business days after receipt of such notice. Any amount so advanced by Beneficiary,together with interest thereon from the elate of such advance at the same rate of indebtedness as specified in the Note(unless payment of such an interest rate would be contrary to applicable law, in which event such sums shall bear interest at the highest rate then allowed by applicable law),shall become an additional obligation of Trustor to Beneficiary and shall be secured by this Deed of Trust. 20. INSURANCE. Trustor shall provide such insurance as required under the Loan Agreement. In the event Trustor fails to maintain the full insurance coverage required by this Attachment No.3 Page 6 of 12 4'k\G:AgTcc:Qaccns:AMch311114/96 RLS 9"58 r Reed of Trust,Beneficiary,after at least seven business days prior notice to Trustor,may,but shall be under no obligation to,take out the required policies of insurance and pay the premiums on such policies. Any amount so advanced by Beneficiary,together with interest thereon from the date of such advance at the same rate of indebtedness as specified in the Note(unless payment of such an interest rate would be contrary to applicable law, in which event such sums shall bear interest at the highest rate then allowed by applicable law),shall become an additional obligation of Trustor to Beneficiary and shall be secured by this Deed of Trust. 21. CONDEMNATION. All judgments,awards of damages,settlements and compensation made in connection with or in lieu of taking all or any part of or interest in the Security under assertion of the power of eminent domain("Funds")are hereby assigned to and shall be paid to Beneficiary. Beneficiary is authorized(but not required)to collect and receive any Funds and is authorized to apply them in whole or in part upon any indebtedness or obligation secured hereby,in such order and manner as Beneficiary shall determine at its sole option. All or any part of the amounts so collected and recovered by Beneficiary may be released to Trustor upon such conditions as Beneficiary may impose for its disposition. Application of all or any part of the Funds collected and received by Beneficiary or the release thereof shall not cure or waive any default under this Deed of Trust. 22. ACCELERATION ON TRANSFER OF SECURITY;ASSUMPTION.In the event that Trustor,without the prior written consent of the Beneficiary, sells, agrees to sell, transfers,or conveys its interest in the Security or any part thereof or interest therein, Beneficiary may at its option declare all sums secured by this Deed of Trust to be immediately due and payable. This option shall not apply in case of. A. the grant of a tenant or leasehold to qualifying households who will occupy Project units as provided for under the Loan Documents and the Regulatory Agreement;or B. sale or transfer of fixtures or personal property pursuant to the grant provisions in this Deed of Trust;or Consent to one sale or transfer shall not be d.-emed to be a waiver of the right to require such consent to future or successive transactions. 23. RECONVEYANCE BY TRUSTEE. This trust is intended to continue for the entire term of the Loan. Upon written request of Beneficiary stating that all sums secured by this Deed of Trust have been paid or forgiven and upon surrender of this Deed of Trust to Trustee for cancellation and retention,and upon payment by Trustor of Trustee's reasonable fees,Trustee shall reconvey the Security to Trustor,or to the person or persons legally entitled thereto. Attachment No.3 Page 7 of 12 41kIG:Agr":Quccns:Anach311114196 RLS 96-858 i r 24. EVENTS OF DEFAULT. Any of th-.events listed in the Loan Agreement as an Event of Default shall also constitute an Event of Default under this Deed of Trust,including,but not limited to,(1)Trustoes failure to pay when due any sums payable under this Deed of Trust, the Note,or the Loan Agreement;or(2)Trustoes failure to observe or to perform any of its covenants,agreements or obligations under this Deed of Trust,the Note,the Loan Agreement, and the Regulatory Agreement. 25, ACCELERATION OF MATURITY. Upon the happening of an Event of Default which has not been cured within the times and in the manner provided in the Loan Agreement, Beneficiary may declare all sums advanced to Trustor under the Note and this Deed of Trust immediately due and payable. 26. BENEFICIARY'S REMEDIES. Upon the happening of an Event of Default which has not been cured within the times and in tl:e manner provided in the Loan Agreement, Beneficiary may,in addition to other rights and remedies permitted by the Loan Agreement,the Note,or applicable law, proceed with any or all of the following remedies: A. Enforce the assignment of rents and right to possession as provided for in this Deed of Trust,and/or seek appointment of a receiver to take over possession of the Security and collect Rents; B. Commence an action to foreclose this Deed of Trust pursuant to California Code of Civil Procedure Sections 725a,et seq., and/or seek appointment of a receiver from a court of competent jurisdiction with the authority to protect Beneficiary's interests in the Security,including the authority to complete construction of improvements; C. Deliver to Trustee a written declaration of Default and demand for sale,and a written Notice of Default and election to cause Trustoes interest in the Security to be sold,wlach notice Trustee or Beneficiary shall duly file for record in the Official Records of Orange County,and exercise its power of sale as provided for below;or D. Pursue any other rights and remedies allow at law or in equity. 27. FORECLOSURE BY POWER OF SALE. Should Beneficiary elect to foreclose by exercise of the power of sale contained in this Deed of Trust,Beneficiary shall notify Trustee and shall deposit with Trustee this Deed of Trust(the deposit of which shall be deemed to constitute evidence that the unpaid sums disbursed under the Note are immediately due and Attachment No.3 Page 8 of 12 41k1G:Agree:Queens:Anach311114196 RL5 96-858 payable), and such receipts and evidence of any expznditures made that are additionally secured hereby as Trustee may require. Upon receipt of such notice from Beneficiary,Trustee shall cause to be recorded, published and delivered to Trustor such Notice of Default and Election to Sell as then required by law and by this Deed of Trust. Trustee shall,without demand on Trustor,after lapse of such time as may then be required by law and after recordation of such Notice of Default and after Notice of Sale having been given as required by law,sell the Security,at the time and place of sale fixed by it in said Notice of Sale,whether as a whole or in separate lots or parcels or items as Trustee shall deem expedient and in such order as it may determine unless specified otherwise by Trustor,at public auction to the highest bidder for cash in lawful money of the United States payable at the time of sale. Trustee shall deliver to the purchaser its deed or deeds conveying the property so sold, but without any covenant or warranty,express or implied. The recitals in such deed of any matters of facts shall be conclusive proof of the truthfulness thereof. Any person, including,without limitation,Trustor,Trustee,or Beneficiary,may purchase at the sale. Trustee may postpone sale of all or any portion of the property by public announcement at such time and place of sale,and from time to time thereafter,and without further notice make such sale at the time fixed by the last postponement,or may, in its discretion,give a new Notice of Sale. After deducting all reasonable costs,fees and expenses of Trustee, including costs of evidence of title in connection with such sale,Trustee shall apply the proceeds of sale as follows: (i) first,to the payment of all sums then secured by this Deed of Trust, in such order and amounts as Beneficiary in its sole discretion determines,and(ii)the remainder, if any,to the person or persons legally entitled thereto. 28. REMEDIES CUMULATIVE. No right,power or remedy conferred upon or reserved to Beneficiary by this Deed of Trust is intended to be exclusive of any other rights, powers or remedies, but each such right,power and remedy shall be cumulative and concurrent and shall be in addition to any other right,power and remedy given hereunder or now or hereafter existing at law or in equity. SLFRAJ,EKQV LSIONS 29. GOVERNING LAW. This Deed of Trust shall be interpreted under and governed by the laws of the State of California,except for those provisions relating to choice of law and those provisions preempted by federal law. 30. ATTORNEYS'FEES AND COSTS. In the event of any Event of Default,or any legal or administrative action is commenced to interpret or to enforce the terms of this Deed of Attachment No.3 Page 9 of 12 *k-1G:Agrce:Quccns:A1tach311114/96 RLS 9"58 Trust,each party shall bear its own attorneys' fees and costs. The prevailing party in such action shall not be entitled to recover any attorneys'fees and costs in such action. 31. CONSENTS AND APPROVALS. Any consent or approval of the City required under this Regulatory Agreement shall not be unreasonably vvithheld. Any approval must be in writing and executed by an authorized representative of the City. 32. TIME. Time is of the essence in this Deed of Trust. 33. NOTICES,DEMANDS AND COMMUNICATIONS. Formal notices,demands and communications between Trustor and Beneficiary shall be sufficiently given and shall not be deemed given unless dispatched by registered or certified mail,postage prepaid,return receipt requested,or delivered personally,to the principal offices of Trustor and Beneficiary as follows: BENEFICIARY: Redevelopment Agency of the City of Huntington Beach 2000 Main Street Huntington Beach, CA 92648 Attention: Executive Director TRUSTOR: Orange County Community Housing 1833 E. 17th Street, Suite 207 Santa Ana,CA 92701 Attention: Executive Director 34. BINDING UPON SUCCESSORS. All provisions of this Deed of Trust shall be binding upon and inure to the benefit of the heirs,adLministrators,executors,successors-in- interest,transferees,and assigns of Trustor,Trustee,and Beneficiary. 35. WAIVER. Any waiver by Beneficiary of any obligation of Trustor in this Deed of Trust must be in writing. No waiver will be implied from any delay or failure by Beneficiary to take action on any breach or default of Trustor or to pursue any remedy allowed under the Deed of Trust or applicable law. Any extension of time granted to Trustor to perform any obligation under this Deed of Trust shall not operate as a waiver or release Trustor from any of its obligations under this Deed of Trust. Consent by Beneficiary to any act or omission by Trustor shall not be construed to be a consent to any other or subsequent act or omission or to ivaive the requirement for Beneficiary's written consent to future%%mivers. 36. AMENDMENTS AND MODIFICATIONS. Any amendments or modifications to this Deed of Trust must be in writing,and shall be made only if mutually agreed upon by Beneficiary and Trustor. Attachment No.3 Page 10 of 12 4' ,G:Agnx:Quccns:Anach3111/4/96 RLS 9"58 37. LOAN AGREEMENT CONTROLS. If there is any contradiction between this instrument and the Loan Agreement,the terms of the Loan Agreement shall control. 38. DEFINITIONS. Capitalized terms not otherwise defined in this Deed of Trust shall have the same meaning as defined terms in the Loan Agreement. 39. PROOFS OF CLAIM. In the case of any receivership, insolvency,bankruptcy, reorganization,arrangement,adjustment,recomposiiion or other proceedings affecting Trustor, its creditors or its property,Trustee,to the extent permitted by Iaw,shall be entitled to file such proofs of claim and other documents as may be necessary or advisable in order to have the claims of Beneficiary allowed in such proceedings and for any additional amount which may become due and payable by Trustor hereunder after such date. 40. SEVERABILITY. Every provision of this Deed of Trust is intended to be severable. If any term or provision of this Deed of Trust is declared to be illegal, invalid, or unenforceable by a court of competent jurisdiction,the legality,validity,and enforceability of the remaining provisions shall not be affected. If the lien of this Deed of Trust is invalid or unenforceable as to any part of the debt, or if the lien is invalid or unenforceable as to any part of the Security, the unsecured or partially secured portion of the debt and all payments made on the debt(whether voluntary or under foreclosure or other enforcement action or procedure)shall be considered to have been first paid or applied to the payment of that portion of the debt which is not secured or partially secured by the lien of this Deed of Trust. 41. SUBSTITUTION OF TRUSTEES. Beneficiary may from time to time appoint another trustee to act in the place and stead of Trustee or any successor. Upon such appointment and without conveyance,the successor trustee shall be vested with all title,powers, and duties conferred upon Trustee. Each such appointment and substitution shall be made by a written instrument executed by Beneficiary containing reference to this Deed of Trust and its place of record,which when duly recorded in the Orange County Office of the Recorder shall be conclusive proof of proper appointment of the successor trustee. 42. ACCEPTANCE BY TRUSTEE. Trustee accepts this Trust when this Deed of Trust,duly executed and acknowledged,is made public record as provided by law. Except as otherwise provided by lam,,the Trustee is not obligated to notify any party hereto of pending sale under this Deed of Trust or of any action or proceeding in which Trustor, Beneficiary,or Trustee shall be a party unless brought by Trustee. Attachment No.3 Page l 1 of 12 4'&%G:Agrcc:Quccns:A1tach3U 1/4196 RLS 9"58 r 1N WITNESS WHEREOF,Trustor has executed this Deed of Trust as of the day and year first above written. TRUSTOR: Orange County Community housing Corporation,a California nonprofit public benefit corporation By: Its: By: Its: THIS DOCUMENT MUST BE NOTARIZED FOR RECORDING BORROWER'S SIGNATURE MUST BE ACKNOWLEDGED Attachment No.3 Page 12 of 12 4WG:Agree:Queens:Attach3U I/4/96 RLS 9"58 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT State of County of Ole WkNG E On /;Z/;zC' /. ' beforeme, YiSTi12E �4. GpT2w`�O� Date `Name and Tft a Officer ce.y..'lane Doe.Notary Pul.011 personally appeared ��-�-�h P 9Jq�'10 t'u M 4ameta1 d S9rW%S ❑personally known to me—OR—Xproved to me on the basis of satisfactory evidence to be the person(k whose name are subscribed to the within instrument and acknowledged to me tha(i sheAhey executed the s e it �herhheir authorized capacity(),and that by erAheir signatureAl on the instrument the person, CmrASM*A_GAMN0oD or the entity upon behalf of which the person*acted, Cwnlx:'�� t9564� executed the instrument. Olonge� ^r Alo1pN Cots* . CEO �D�t72,1fti{q WITNESS my hand and official seal. $"lure of Notary Puoke OPTIONAL Though the Information below Is not required by taw,it may prove va+uable to persons relying on the document and could prevent fraucufent removai and reattachment of nis form to another i1m mend. Description of Attached Document Title or Type of Document: Document Date: Number of Pages: Signer(s)Other Than Named Above: Capacity(ies) Claimed by Signer(s) Signer's Name: Signer's Name: ❑ Individual C Individual © Corporate Officer C Corporate Officer Title(s): Ttle(s): ❑ Partner—❑Limited ❑General ❑ Partner—❑ Limited ❑General ❑ Attorney-in-Fact ❑ Attorney-in-Fact ❑ Trustee ❑ Trustee ❑ Guardian or Conservator ❑ Guardian or Conservator ❑ Other: Top Of thumb here ❑ Other: Top of thump here Signer Is Representing: Signer Is Representing: 0 1994 Naf anal Notary Association•8236 Rommel Ave..P.O.Box 7184•Canape Park.CA 913D9.718; Prod.No.5907 Reader.Cart Tog-Free 1-9048784ff827 w • Exhibit"A"to Deed of Trust Legal Description 17422 Queens Lane Lot 14 of Tract No. 4153,in the City of Huntington Beach,County of Orange,State of Califomia,as per map recorded in Book 174,pages 12 and 13 of miscellaneous maps, in the office the County Record.-r of said county,except all subsurface water,as dedicated on the map of the Tract and as conveyed to the City of Huntington Beach in deed recorded February 20, I963 in book 6418, page 408 of official records,without the right of entry to the surface and subsurface area to a depth of 500 feet for the purpose of producing eater. THIS IS A SECOND DEED OF TRUST SUBJECT AND SUBORDINATE TO A FIRST DEED OF TRUST RECORDING CONCURRENTLY HEREWITH Exhibit"A"to Attachment No.3 Page 1 of 1 4%k1G:Agree:KoledoAttach3%11/4,`9e RLS 9&758 Recoroed in the County of orange, California Gary L. Granville, Clerk/Recorder No Fee 1 WGS8554 3:18p 12/31/96 007 15005997 15 33 NO FEE DOCUMENT D11 A36 502 14 21.00 39.00 0.00 0.00 0.00 0.00 0.00 When recorded,mail to: x. City of Huntington BeacE 2000 Main Street LP n� Huntington Beach,CA 92648CP r Attention: Office of City Clerk " a r } DEED OF TRUST;ASSIGN51EN-T OF RENTS, AND SECURITY AGREEMENT (Securing loan of$252,000.00 THIS DEED OF TRUST,ASSIGNMENT OF RENTS,AND SECURITY AGREEMENT("Deed of Trust")is made this 261h day of December I996,by O Orange County Community (lousing Corporation,a California nonprofit public benefit corporation("Trustor"), to Stew= Title Chmpany as trustee("Trustee"), for the benefit of the rb Redevelopment Agency of the City of Huntington Beach,a public body("Beneficiary"). GRAMN MUST 1. GRANT. Trustor,in consideration of tlic indebtedness referred to below,hereby irrevocably grants and conveys to Trustee,IN TRUST,WITH POWER OF SALE, for the benefit and security of Beneficiary,all of Trustofs interest in the property located in the City of Huntington Beach, County of Orange, State of California,and described in the attached Exhibit A, incorporated herein by this reference(the "Property"); TOGETHER WITH all interest,estates or other claims,both in law and in equity which Trustor now has or may hereafter acquire in the Property;all buildings,structures, fixtures, improvements,signs,and landscaping now or hereafter erected or located on the Property, including all equipment and machinery used for supplying or distributing heating,cooling, electricity,gas,water,air, and light,all kitchen and laundry appliances such as washers,dryers, refrigerators,garbage disposals,ovens,ranges,dishwashers,all plumbing and bathroom fixtures, all security and access control equipment, fire prevention and extinguishment equipment, - elevators, floor coverings,window coverings,paneling,cabinets,(provided,however,that Attachment No.3A Page 1 of 12 4tik1G:Agree:Dueens:Attach3A 11114196 RL5 96-858 Trustor shall have the right to remove, if necessary, such fixtures,furnishings,and equipment for the purpose of replacement with similar items of the same quality performing the same functions, which replacements shall themselves become part of this grant);all building material and equipment either now or hereafter delivered to the Property and intended to be installed therein or any such material and equipment purchased with Loan proceeds whether or not located on the Property;all reserves,accounts,deferred payments, and refunds relating to development on the Property; all rents and income generated by the Property or improvements thereon(subject however to the assignment of rents to Lender contained herein);all leases,subleases and rental agreements covering the Property or any portion thereof now existing or hereafter entered into, and all interests of Trustor in security deposits,advance rentals,accounts,or payments of similar nature with respect to such leases,subleases,or rend:] agreements;all casements and rights-of- way appurtenant to the Property, including parking and recreational easements,and all interests of Trustor in any land lying within the right-of-way of any street,sidewalks,and areas of land adjacent to or used in connection with the Property;all development rights and credits,air rights, water rights,and oil,gas or mineral rights with respect to the Property;all claims or demands with respect to insurance proceeds,and all awards made for a taking by eminent domain;all interests and rights in any private or government grants, subsidies, loans, or other financing with respect to development on the Property;all interests in personal property used in and about the Property(except furniture and other personal property of occupants of dwelling units on the Property);all intangible property and rights relating to the Property or operations on the Property,including trade names, goodwill,trademarks,and service marks; all government permits,approvals,and map rights related to construction on the Property;all architectural, structural,and mechanical plans,specifications,designs,studies,and data with respect to construction of improvements on the Property;all environmental tests, studies and reports with respect to the Property;al:current and future claims and rights of action of Trustor against prior owners and operators of the Property,neighboring property owners and operators,tenants and former tenants,consultants,advisors,and other third parties with respect to environmental or Hazardous Materials contamination and cleanup of the Property under any federal,state,or local ordinances,statutes,regulations,or administrative decisions or common law. All of the foregoing,together with the Property, is herein referred to as the"Security." OBLIGATIONS SECURED 2. Trustor makes this grant for the purpose of securing the following obligations: A. Repayment of the indebtedness of Trustor to Beneficiary in the principal sum of TWO hundred Fifty-two Thnt25aIIrL__DolJars($ 252,000.E with interest thereon (the "Loan")evidenced by a promissory note executed by Trustor(the "Note"),on file at the offices of Beneficiary,which is hereby incorporated into this Deed of Trust by this reference)or as much as has been disbursed to Trustor therewith, Attachment No.3A Page 2 of 12 4*XG:Agree:Queens:Attach3A 111/4/96 RLS 96-858 " f t along with any extensions,amendments, modifications,or renewals to the Note; and B. Payment of any sums advanced by Beneficiary to protect the security and priority of this Deed of Trust; and C. Payment of any sums advanced by Beneficiary following a breach of Trustoes obligation to advance said sums and the expiration of any applicable cure period, Nvith interest thereon as provided herein;and D. Performance of every obligation,covenant or agreement of Trustor contained in this Deed of Trust,the Note,the Loan Agreement executed between Trustor and Beneficiary,on file at the offices of Beneficiary,which is hereby incorporated into this Deed of Trust by this reference),and the Regulatory Agreement executed between Trustor and Beneficiary of dated the same day as this Deed of Trust ("Regulatory Agreement"), including all modifications,extensions and renewals of these obligations;and E. Performance of any other obligation or repayment of any other indebtedness of Trustor to Beneficiary,where such evidence of obligation or indebtedness specifically recites that it is secured by this Deed of Trust. ABSOLM ASSIONM=OF=5 AND RIGHT TO POSSESSION 3. ASSIGNMENT. As additional security,Trustor hereby assigns to Beneficiary: (a)all of the rents,revenues,profits,and income from the Security, any deposits now or hereafter in Trustor's possession which have been collected vtith respect to the Security,and any reserve or capital funds now or hereafter held by Trustor with aspect to construction or operation of the Security(collectively,the "Rents"); and(b)the right to enter,take possession of,and manage the Security; provided however that Trustor shall have,before an Event of Default,the exclusive right to possess the Security and to collect Rents and use them in accordance with the Loan Documents. This assignment is intended to be an absolute and present transfer of Trustoes interest in existing and future Rents,effective as of the date of this Deed of Trust. 4. ENFORCEMENT. Upon the happening of an Event of Default and written notice to Trustor,Beneficiary may,in addition to other rights and remedies permitted by the Loan Agreement,this Deed of Trust,or applicable law, (a)enter upon, take possession of,and manage the Security,either in person as a mortgagee-in-possession,by agent,or by a receiver appointed by a court,and do any acts which it deems necessary or desirable to preserve the value, marketability or rentability of the Security,(b)collect all Rents,including those past due and unpaid,and apply the same to pay for the costs and expenses of operation of the Security, Attachment No.3A Page 3 of 12 41k1G:Agree:QueensAttach3A 111/4/96 RLS 96-858 including attorneys' fees,and pay off any indebtedness secured by this Deed of Trust,all in such order as Beneficiary may determine,and/or(c)enter upon and take possession of the Security. Beneficiary may make,cancel,enforce, and modify leases and rental agreements,obtain and evict tenants,set and modify rent terms, sue for rents due,enter into,modify,or terminate any contracts or agreements,or take any legal action, as it deems necessary with respect to the Rents or to development or operation of the Security. 5. APPOINTMENT OF A RECEIVER. In any action to enforce this assignment, Beneficiary may apply for the appointment of a recei%,cr to take possession of the Security and take whatever measures are necessary to preserve and manage the Security for the benefit of Beneficiary and the public interest. Trustor hereby consents to the appointment of a receiver. The receiver shall have all of the authority over the Security that Beneficiary would have if Beneficiary took possession of the Security under this assignment as a mortgagee-in-possession, including the right to collect and apply Rents and the right to complete construction of improvements. 6. NO WAIVER OF POWER OF SALE. The entering upon and taking possession of the Security and the collection of Rents shall not cure or waive any default or notice of default hereunder or invalidate any act done in response to such default or notice of default and, notwithstanding the continuance in possession of the Security or the collection and application of Rents, Beneficiary shall b:. entitled to exercise every right provided for in this Deed of Trust or by law upon occurrence of any Event of Default, including the right to exercise the power of sale. COMMERCIAL CODE SECIMITY AGREEMENT 7. GRANT. This Deed of Trust is intended to be a security agreement and financing statement pursuant to the California Commercial Code for any of the items specified above as part of the Security which under applicable law may be subject to a security interest pursuant to the Commercial Code,and Trustor hereby grants Beneficiary a security interest in said items. Beneficiary may file a copy of this Deed of Trust in the real estate records or other appropriate index as a financing statement for any of the items specified as part of the Security. Trustor shall execute and deliver to Beneficiary at Beneficiary's request any financing statements,as well as extensions,renewals,and amendments thereof,and copies of this instrument in such form as Beneficiary may require to perfect a security interest with respect to said items. 8. REMEDIES. Upon Trustoes breach of any obligation or agreement in the Loan Documents,Beneficiary sliall have the remedies of a secured party under the Commercial Code and at Beneficiary's option may also invoke the remedies provided for elsewhere in this Deed of Trust with respect to said items. Beneficiary may proceed against the items of real property and personal property specified above separately or together and in any order whatsoever. Attachment No.3A Page 4 of 12 WG Agree:QueensAttachM 111/4.196 Rt.S 96-858 r j:IGHTS AND OBLIGATIONS OF TRUSTOR 9. PERFORMANCE OF SECURED OBLIGATION. Trustor shall promptly perform each obligation secured by this Deed of Trust. 10. PAYMENT OF PRINCIPAL AND INTEREST. Trustor shall promptly pay when due the principal and interest on the indebtedness evidenced by the Note. 11. MAINTENANCE OF THE SECURITY.Trustor shall,at the Trustor's own expense, maintain and preserve the Security or cause the Security to be maintained and preserved in good condition,in good repair,and in a decent,safe,sanitary,habitable and tenantable condition. Trustor shall not cause or permit any violations of any laws,ordinances,regulations, covenants,conditions,restrictions,or equitable servitudes as they pertain to improvements, alterations, maintenance or demolition on the Security. Trustor shall not commit or permit waste on or to the Security. Trustor shall not abandon the Security. Beneficiary shall have no responsibility over maintenance of the Security. In the event Trustor fails to maintain the Security in accordance with the standards in this Deed of Trust,the Loan Agreement, or the Regulatory Agreement, Beneficiary,after at least thirty(30)calendar clays prior notice to Trustor,may,but shall be under no obligation to, make such repairs or replacements as are necessary and provide for payment thereof. Any amount so advanced by Beneficiary,together with interest thereon from the date of such advance at the same rate of indebtedness as specified in the Note(unless payment of such an interest rate would be contrary to applicable law, in Which event such sums shall bear interest at the highest rate then allowed by applicable law), shall become an additional obligation of Trustor to Beneficiary and shall be secured by this Deed of Trust. 12. INSPECTION OF THE SECURITY. Trustor shall permit Beneficiary to enter and inspect the Security for compliance with these obligations upon 24 hours advance written notice of such visit by Beneficiary to Trustor or Trustor's management agent. 13. LIENS, ENCUMBRANCES,AND CHARGES. Trustor shall discharge any lien or encumbrance not approved by Trustor in writing that may attain priority over this Deed of Trust,as provided for in the Loan Agreement. 14. DEFENSE AND NOTICE OF CLAIMS AND ACTIONS. Trustor shall appear in and defend,at its own expense,any action or proceeding purporting to affect the Security and/or the rights of Beneficiary. Trustor shall give Beneficiary and Trustee prompt notice in writing of the assertion of any claim,of the filing of any action or proceeding and of any condemnation offer or action with respect to the Security. Attachment No.3 A Page 5 of 12 4'k1G:Agree:Queens:Attach3A 111/4/96 RLS 9"58 15. SUITS TO PROTECT THE SECURITY. Beneficiary shall have power to institute and maintain such suits and proceedings as it may deem expedient(a)to prevent any impairment of the Security or the rights of Beneficiary,(b)to preserve or protect its interest in the Security and in the Rents,and(c)to restrain the enforcement of or compliance with any governmental legislation,regulation,or order,if th:enforcement of or compliance with such legislation,regulation,or order would impair the Security or be prejudicial to the interest of Beneficiary. 16. DAMAGE TO SECURITY. Trustor shall give Beneficiary and Trustee prompt notice in writing of any d=age to the Security. If any building or improvements erected on the Property is damaged or destroyed by an insurable cause,Trustor shall use the insurance proceeds to repair or restore said buildings and improvements consistent with the original plans and specifications. Such wort:or repair shall be commenced within 120 days after the damage or loss occurs and shall be complete within one year thereafter. All insurance proceeds collected for such damage or destruction shall be applied to the cost of such repairs or restoration. 17. TITLE. Trustor warrants that Trustor lawfully has legal title to the Security without any limitation on the right to encumber. 18. GRANTING OF EASEMENTS. Trustor may not grant easements,licenses, rights-of-way or other rights or privileges in the nature of easements with respect to the Security except those required or desirable for installation and maintenance of public utilities including water, gas, electricity,sewer, cable television,telephone, or those required by law. 19. TAXES AND LEVIES. Trustor shall pay prior to delinquency,all taxes, fees, assessments,charges and levies imposed by any public authority or utility company which are or may become a lien affecting the Security, However,Trustor shalt not be required to pay and discharge any such tax,assessment,charge or levy so long as(a)the legality thereof shall be promptly and actively contested in good faith and by appropriate proceedings,and(b)Trustor maintains reserves adequate to pay any contested liabilities. In the event that Trustor fails to pay any of the foregoing items,Beneficiary may,but shall be under no obligation to,pay the same, after Beneficiary has notified Trustor of such failure to pay and Trustor fails to fully pay such items within thirty(30)business days after receipt of such notice. Any amount so advanced by Beneficiary,together with interest thereon from the date of such advance at the same rate of indebtedness as specified in the Note(unless payment of such an interest rate would be contrary to applicable law, in which event such sums shall bear interest at the highest rate then allo%ved by applicable law),shall become an additional obligation of Trustor to Beneficiary and shall be secured by this Deed of Trust. 20. INSURANCE. Trustor shall provide such insurance as required under the Loan Agreement. In the event Trustor fails to maintain th.e full insurance coverage required by this Attachment No.3A Page 6 of 12 41k1GAgree:Queens Attach3A H 1/4/96 RL5 96-858 - . 1 Deed of Trust, Beneficiary,after at least seven business days prior notice to Trustor,may,but shall be under no obligation to,take out the required policies of insurance and pay the premiums on such policies. Any amount so advanced by Beneficiary,together with interest thereon from the date of such advance at the same rate of indebtedness as specified in the Note(unless payment of such an interest rate would be contrary to applicable law, in which event such sums shall bear interest at the highest rate then allowed by applicable law),shall become an additional obligation of Trustor to Beneficiary and shall be secured by this Deed of Trust. 21. CONDEMNATION. All judgments,awards of damages,settlements and compensation made in connection with or in lieu of taking all or any part of or interest in the Security under assertion of the power of eminent domain("Funds")are hereby assigned to and shall be paid to Beneficiary. Beneficiary is authorized(but not required)to collect and receive any]Funds and is authori3ed to apply them in whole or in part upon any indebtedness or obligation secured hereby, in such order and manner as Beneficiary shall determine at its sole option. All or any part of the amounts so collected and recovered by Beneficiary may be released to Trustor upon such conditions as Beneficiary may impose for its disposition. Application of all or any part of the Funds collected and received by Beneficiary or the release thereof shall not cure or vmive any default under this Deed of Trust. 22. ACCELERATION ON TRANSFER OF SECURITY;ASSUMPTION.In the event that Trustor,without the prior written consent of the Beneficiary,sells,agrees to sell, transfers,or conveys its interest in the Security or any part thereof or interest therein,Beneficiary may at its option declare all sums secured by this Deed of Trust to be immediately due and payable. This option shall not apply in case of: A. the grant of a tenant or leasehold to grsalifying households who will occupy Project units as provided for under the Loan Documents and the Regulatory Agreement;or B. sale or transfer of fixtures or personal property pursuant to the grant provisions in this Deed of Trust; or Consent to one sale or transfer shall not be deemed to be a waiver of the right to require such consent to future or successive transactions. 23. RECONVEYANCE BY TRUSTEE. This trust is intended to continue for the entire term of the Loan. Upon written request of Beneficiary stating that all sums secured by this Deed of Trust have been paid or forgiven and upon surrender of this Deed of Trust to Trustee for cancellation and retention,and upon payment by Trustor of Trustee's reasonable fees,Trustee shall reconvey the Security to Trustor,or to the person or persons legally entitled thereto. Attachment No.3A Page 7 of 12 4'ANGAgree:0ueens:Attach3A /11/4196 RLS 96-858 • . f DEFAULT AND 1MIEDIES 24. EVENTS OF DEFAULT. Any of the events listed in the Loan Agreement as an Event of Default shall also constitute an Event of Default under this Deed of Trust,including,but not limited to, (1)Trustor's failure to pay when due any sums payable under this Deed of Trust, the Note,or the Loan Agreement;or(2)Trustor's failure to observe or to perform any of its covenants,agreements or obligations under this Deed of Trust,the Note,the Loan Agreement, and the Regulatory Agreement. 25. ACCELERATION OF MATURITY. Upon the happening of an Event of Default which has not been cured within the times and in the manner provided in the Loan Agreement, Beneficiary may declare all sums advanced to Trustor under the Note and this Deed of Trust immediately due and payable. 26. BENEFICIARY'S REMEDIES. Upon the happening of an Event of Default which has not been cured within the times and in&e manner provided in the Loan Agreement, Beneficiary may,in addition to other rights and remedies permitted by the Loan Agreement,the Note,or applicable law,proceed with any or all of the following remedies: A. Enforce the assignment of rents and right to possession as provided for in this Deed of Trust,and/or seek appointment of a receiver to take over possession of the Security and collect Rents; B. Commence an action to foreclose this Deed of Trust pursuant to California Code of Civil Procedure Sections 725a,et seq.,and/or seek appointment of a receiver from a court of competent jurisdiction with the authority to protect Beneficiary's interests in the Security, including the authority to complete construction of improvements; C. Deliver to Trustee a written declaration of Default and demand for sale,and a written Notice of Default and election to cause Trustor's interest in the Security to be sold,which notice Trustee or Beneficiary shall duly file for record in the Official Records of Orange County,and exercise its power of sale as provided for below; or D. Pursue any other rights and remedies allow at law or in equity. 27. FORECLOSURE BY POWER OF SALE. Should Beneficiary elect to foreclose by exercise of the power of sale contained in this Dzed of Trust,Beneficiary shall notify Trustee and shall deposit with Trustee this Deed of Trust(the deposit of which shall be deemed to constitute evidence that the unpaid sums disbursed under the Note are immediately due and Attachment No.3A Page 8 of 12 4'AXG:Agree:Queens:Attach3A %11/4/96 RLS 96-858 payable),and such receipts and evidence of any exp nditures made that are additionally secured hereby as Trustee may require. Upon receipt of such notice from Beneficiary,Trustee shall cause to be recorded, published and delivered to Trustor such Notice of Default and Election to Sell as then required by law and by this Deed of Trust. Trustee shall,without demand on Trustor,after lapse of such time as may then be required by law and after recordation of such Notice of Default and after Notice of Sale having been given as required by law,sell the Security,at the time and place of sale fixed by it in said Notice of Sale,whether as a whole or in separate lots or parcels or items as Trustee shall deem expedient and in such order as it may determine unless specified otherwise by Trustor,at public auction to the highest bidder for cash in lawful money of the United States payable at the time of sale. Trustee shall deliver to the purchaser its deed or deeds conveying the property so sold,but without any covenant or warranty,express or implied. The recitals in such deed of any matters of facts shall be conclusive proof of the truthfulness thereof. Any person, including,without limitation,Trustor,Trustee,or Beneficiary,may purchase at the sale. Trustee may postpone sale of all or any portion of the property by public announcement at such time and place of sale,and from time to time thereafter,and without further notice make such sale at the time fixed by the last postponement,or may,in its discretion,give a new Notice of Sale. After deducting all reasonable costs, fees and expenses of Trustee,including costs of evidence of title in connection with such sale,Trustee shall apply the proceeds of sale as follows: (i)first,to the payment of all sums then secured by this Deed of Trust, in such order and amounts as Beneficiary in its sole discretion determines,and(ii)the remainder,if any,to the person or persons legally entitled thereto. 28. REMEDIES CUMULATIVE. No right,power or remedy conferred upon or reserved to Beneficiary by this Deed of Trust is intended to be exclusive of any other rights, powers or remedies, but each such right,power and remedy shall be cumulative and concurrent and shall be in addition to any other right,power and remedy given hereunder or now or hereafter existing at law or in equity. GENERAL PROVISIONS 29. GOVERNNG LAW. This Deed of Trust shall be interpreted under and governed by the laws of the State of California,except for those provisions relating to choice of la�v and those provisions preempted by federal law. 30. ATTORNEYS' FEES AND COSTS. In the event of any Event of Default,or any legal or administrative action is commenced to interpret or to enforce the terms of this Deed of Attachment No.3A Page 9 of 12 41klG:Agree:Queens:Attach3A \1114I96 RLS 9"58 Trust,each party shall bear its own attorneys' fees and costs. The prevailing party in such action shall not be entitled to recover any attorneys'fees and costs in such action. 31. CONSENTS AND APPROVALS. Any consent or approval of the City required under this Regulatory Agreement shall not be unreasonably%Nithheld. Any approval must be in writing and executed by an authorized representative of the City. 32. TIME. Time is of the essence in this Deed of Trust. 33. NOTICES, DEMANDS AND COMMUNICATIONS. Formal notices,demands and communications between Trustor and Beneficiary shall be sufficiently given and shall not be deemed given unless dispatched by registered or certified mail,postage prepaid,return receipt requested,or delivered personally,to the principal offices of Trustor and Beneficiary as follows: BENEFICIARY: Redevelopment Agency of the City of Huntington Beach 2000 Main Street Huntington Beach,CA 92648 Attention: Executive Director TRUSTOR: Orange County Community Housing I833 E. 17th Street, Suite 207 Santa Ana,CA 92701 Attention: Executive Director 34. BINDING UPON SUCCESSORS. All provisions of this Deed of Trust shall be binding upon and inure to the benefit of the heirs, administrators,executors, successors-in- interest,transferees,and assigns of Trustor,Trustee,and Beneficiary. 35. WAIVER. Any waiver by Beneficiary of any obligation of Trustor in this Deed of Trust must be in writing. No waiver will be implied from any delay or failure by Beneficiary to take action on any breach or default of Trustor or to pursue any remedy allowed under the Deed of Trust or applicable law. Any extension of time granted to Trustor to perform any obligation under this Deed of Trust shall not operate as a waiver or release Trustor from any of its obligations under this Deed of Trust. Consent by Beneficiary to any act or omission by Trustor shall not be construed to be a consent to any other or subsequent act or omission or to waive the requirement for Beneficiary's written consent to future waivers. 36. AMENDMENTS AND MODIFICATIONS. Any amendments or modifications to this Deed of Trust must be in writing,and shall be made only if mutually agreed upon by Beneficiary and Trustor. Attachment No.3A Page 10 of 12 4+k%G:Agree:QueensAttach3A 111/4196 RLS 96-858 37. LOAN AGREEMENT CONTROLS.If there is any contradiction between this instrument and the Loan Agreement,the terms of the Loan Agreement shall control. 38. DEFINITIONS. Capitalized terms not otherwise defined in this Deed of Trust shall have the same meaning as defined terms in the Loan Agreement. 39. PROOFS OF CLAIM. In the case of any receivership, insolvency,bankruptcy, reorganization,arrangement,adjustment,recomposition or other proceedings affecting Trustor, its creditors or its property, Trustee,to the extent permitted by law, shall be entitled to file such proofs of claim and other documents as may be necessary or advisable in order to have the claims of Beneficiary allowed in such proceedings and for any additional amount which may become due and payable by Trustor hereunder after such date. 40. SEVERABILITY. Every provision of this Deed of Trust is intended to be severable. If any term or provision of this Deed of Trust is declared to be illegal,invalid,or unenforceable by a court of competent jurisdiction,the legality,validity, and enforceability of the remaining provisions shall not be affected. If the lien of this Deed of Trust is invalid or unenforceable as to any part of the debt,or if the lien is invalid or unenforceable as to any part of the Security,the unsecured or partially secured portion of the debt and all payments made on the debt(whether voluntary or under foreclosure or other enforcement action or procedure)shall be considered to have been first paid or applied to the payment of that portion of the debt which is not secured or partially secured by the lien of this Deed of Trust. 41. SUBSTITUTION OF TRUSTEES. Beneficiary may from time to time appoint another trustee to act in the place and stead of Trustec or any successor. Upon such appointment and without conveyance,the successor trustee shall be vested with all title,powers,and duties conferred upon Trustee. Each such appointment and substitution shall be made by a written instrument executed by Beneficiary containing reference to this Deed of Trust and its place of record,which when duly recorded in the Orange County Office of the Recorder shall be conclusive proof of proper appointment of the successor trustee. Attachment No.3A Page 11 of 12 4W1G:Agree:Queens:Att2ch3A 111/4,196 RLS 96-858 42. ACCEPTANCE BY TRUSTEE. Trustee accepts this Trust when this Deed of Trust,duly executed and acknowledged, is made public record as provided by law. Except as otherwise provided by law,the Trustee is not obligated to notify any party hereto of pending sale under this Deed of Trust or of any action or proceeding in which Trustor,Beneficiary,or Trustee shall be a party unless brought by Trustee. IN WITNESS WI IEREOF,Trustor has executed this Deed of Trust as of the day and year first above written. TRUSTOR: Orange County Community Mousing Corporation,a California nonprofit public benefit corporation By: G�-2 Its: t By: Its: THIS DOCUMENT MUST BE NOTARIZED FOR RECORDING BORROWER'S SIGNATURE MUST BE ACKNOWLEDGED Attachment No.3A Page 12 of 12 4` %G:Agree:Queens:AttaCh3A 111/4/96 RLS 96-858 Exhibit"A"to Deed of Trust Legal Description 17432 Queens Lane Lot 15 of Tract No.4153, in the City of Huntington Beach, County of Orange, State of California,as per map recorded in Book 174,pages tit and 13 of miscellaneous maps,in tht office of the County Recorder of said county,except all subsurface water,as dedicated on the map of the Tract and as conveyed to the City of Huntington Beach in deed recorded February 20, 1463 in book 6418,page 408 of official records,without the right of entry to the surface and subsurface area to a depth of 500 feet for the purpose of producing water. Exhibit A to Attachment No.3A Page 1 of 1 4*%G:Agfee:Queens:Attach3A 14114M6 RL.S 9"58 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT ---------- -------- State of r~pill FaiiP-Yr r l�1 County of On l�l�b l 4�' before me, o-Otev STl nC 4- G► VIt000 Date Neame and Tine of Owcer(e g..'Jane Doe.Notary PrbC) personally appeared A �' � Q p- o W t V1 Rame(s)of Srgner(s) ❑personally known to me—OR— proved to me on the basis of satisfactory evidence to be the person^ whose rame(.jy fibre subscribed to the within instrument and acknowledged to me tha(pshe/they executed the s e in his/her/theirauthorixed capacity(ies),and that by erttheir signatureK on the instrument the persorAT, or the entity upon behalf of which the person,*acted, CHra7KA.GA7WOO) executed the instrument. -� NotarffWl=—Caltk1$ WITNESS my hand and official seal. orange Cotrity My Comm.Elfplre!Oct?2.1499 s+q+N,i..a rkaar„Pwrc OPTIONAL '171ough the information below 1s not required by law,it may prove valuable to persons relying on the document and could prevent fraudulent remover and reattachment or Mis torn to another document. Description of Attached Document Title or Type of Document: Document Date: Number of Pages: Signer(s) OtherThan Named Above: Capacity(ies) Claimed by Signer(s) Signer's Name: Signer's Name: C Individual ❑ Individual ❑ Corporate Officer ❑ Corporate Officer Titie(s): Ttle(s): ❑ Partner—❑ Limited ❑General ❑ Partner—❑ Limited ❑General ❑ Attomey-in-Fact ❑ Attorney-in-Fact ❑ Trustee C Trustee ❑ Guardian or Conservator 7thUmbh-ere. C Guardian or Conservator El Other: Top of C Other. Top of amirrn here Signer Is Representing: Signer Is Representing: 019%ff_wonal Notary ASsadatgn-&M%mtel Ave.,P.O.Box 7t84-Canoga Park CA o1309-7184 Prod.No.5907 RsorAer.Can Tow-Free 1-800d67E-Ml Recorded in trie County of Orange, California Gary L. Granville. Clerk/Recorder I�11.�111�11.11IIL111;.1i1','l�.11'.:1.1��.1'.f��ll' No Fee NO FEE DOCUMENT 19900658659 3: epn i2M/96 005 15005999 15 33 Recording requested by and Al2 16 7.00 45.00 0.00 0.00 0.00 0.00 When recorded,mail to: 3s City of Huntington Beach 2000 Main Street `D e,z Huntington Beach,CA 92648 Cn U , Attn: City Clerk --v x 1a, r` REGULATORY AGREEMENT BY AND BETINMEN THE REDEVELOPMENT I 1 P AGENCY OF THE CITY OF HUNTINGTO`BEACH AND ORANGE COUNTY COMMUNITY HOUSI`'G CORPORATION CONCERNING THE ACQUISITION AND (� REHABILITATION OF AFFORDABLE HOUSING AT 17422 QUEENS LANE,WITH (� FUNDS OBTAINED FROM THE HOME INVESTMENT PARTNERSHIP PROGRAM This Regulatory Agreement is made this lbw' day of zatltA, bor- , 1996,by and between the Redevelopment Agency of the City of Huntington Beach,a public body(the "Agency"),and Orange County Community Housing Corporation,a California public benefit corporation("OCCHC"). RECITALS WI-fEREAS, OCCIIC intends to purchase a four-unit building on Queens Lane in the City of Huntington Beach;and OCCHC desires that all of the Project's units be rented at prices affordable to low income households; and Attachment No.4 Page Iof13 4\k-1Agmc:Qtzccns:Anach4 l[IN64196 RLS 96.759 s [ F The Redevelopment Agency has received a commitment of funds from the City of Huntington Beach. The City has received Home Investment Partnership Program funds ("HOME Funds") from the United States Department of Housing and Urban Development ("HUD")pursuant to the Cranston-Gonzales National Housing Act of 1990 for the purpose of expanding the supply of decent,safe, sanitary and affordable housing for very-low and low- income persons and families; and OCC[IC has received a loan from the Agency of HOME Funds to support the acquisition and rehabilitation of the Project,and the funds have been made available in order to help achieve financial feasibility for the Project and maximize the affordability of Project units;and As further consideration for this funding and to further the interests of the Agency, Agency and OCC[IC have agreed to enter into and record this Regulatory Agreement. The purpose of this Regulatory Agreement is to regulate and restrict the occupancy,rents,operation, ownership,and management of the Project. The covenants in this Regulatory Agreement are intended to run with the l.md and be binding on OCC:HC and its successors, NOW THEREFORE,IN CONSIDERATION of the mutual agreements,obligations,and representations,and in further consideration for the aforementioned funding,OCCI-IC,and Agency hereby agree as follows: ARTICLE 1. DEFINITIONS The following terms have the meanings and content set forth in this section wherever used in this Regulatory Agreement or attached exhibits. 1.1 "AREA MEDIAN INCOME" means the median income for the Orange County Primary Metropolitan Statistical Area(PMSA),tNith adjustments for household size,as determined from time to time by the U.S.Department of Housing and Urban Development (IIUD)pursuant to the United States Housing Act of 1937 as amended,or such other method of median income calculation applicable to the Agency that[IUD may hereafter adopt in connection with said Act. 1.2 "AGENCY" means the Redevelopment Agency of the City of Huntington Beach, a public body,and its officers,officials,directors,employees,agents and authorized representatives. Attachment No.4 Page 2 of 13 411AAgrce:Quccns:Attach4%[1/04/96 RLS 96-759 1.3 "DEED OF TRUST" means the deed of trust,placed on the Property as security for the Loan with OCCHC as trustor and the Agency as beneficiary,as well as any amendments to,modifications of,and restatements of said deed of trust. 1.4 "HOME" means Home Investment Partnership Program created by the National Affordable Housing Act of 1990. 1.5 "LOAN" means any loan of funds provided by the Agency to OCCHC for the Project. 1.6 "LOAN DOCUMENTS" means collectively the Deed of Trust,Note, and this Regulatory Agreement as they may be amended,modified,or restated from time to time,along with all exhibits and attachments to these documents. 1.7 "NOTE" means the promissory note executed by OCCI IC in favor of the Agency evidencing the Loan,which is secured by the deed of trust,as well as any amendments to, modifications of,or restatements of said promissory note. 1.8 "PROJECT" means the four(4)units of rental housing on the Property to be owned and operated by OCCIIC for Very Low-Income Households. 1.9 "PROPERTY" means the real property described in the attached Exhibit A,which is hereby incorporated into this Regulatory Agreement by this reference. 1.10 "VERY LOW-INCOME HOUSEHOLD"means a household whose annual income does not exceed fifty percent(50%)of the median income for the Orange County PMSA as determined by HUD with adjustments for smaller and larger households. 2.1 "UNIT" means a housing unit in the Project. ARTICLE 2. OCCHC'S OBLIGATIONS 2.1 COMPLIANCE WITH LOAN DOCUMENTS. OCCHC's actions with respect to the Property and the use of Loan funds shall at all times be in full conformity with all of the requirements of the Loan Documents. 2.2 TERM OF AGREEMENT. This Regulatory Agreement shall commence upon execution and shall remain in full force and effect for thirty(30)years. Attachment No.4 Page 3 of 13 41k1Agree:Qucens:Attach4%]M196 RL,S 96-758 2.3 COMPLIANCE WITH PROGRAM REQUIREMENTS. OCCHC shall comply with all requirements imposed on projects assisted under the HOME Program as contained in 42 U.S.C. Sections 12701,et seq.,24 C.F.R.Part 92,and other implementing rules and regulations. ARTICLE 3. PROJECT OCCUPANCY AND RENTS 3.1 OCCUPANCY OF PROJECT. OCCHC shall limit for the full term of this Regulatory Agreement the rental of all four(4)Units to Very Low-Income households at no more than the maximum rental charges set forth in this Regulatory Agreement. The Units restricted by this Regulatory Agreement shall consist of four(4)two-bedroom units. The income Ievels and other qualifications of Very Low-Income Household applicants for Units shall be certified prior to initial occupancy and recertified yearly by OCCHC. In the event that recertification of a Very Low-Income Household's income indicates that the income exceeds the maximum income designated for a Very Low-Income Household, OCCHC shall adjust the household's rent to equal the lesser of(a)thirty percent(30%)of the household's gross income or (b)the fair market rental of the unit. In addition,OCCHC shall rent the next available Project unit to a Very Low-Income Household. 3.2 MAXIMUM RENTAL CHARGES. The total charges for rent,utilities,and related services to Very Low Income Household shall not exceed thirty percent(300/0)of fifty percent(501/o)of Area Median Income adjusted for family size. Fifty percent(50%)of Area Median Income for a three(3)person family shall be assumed for a two (2)bedroom unit and fifty percent(50%)of Area Median Income for a five(5)person family for a three-bedroom unit. Initial rents for each Unit shall be approved by the Agency at the time of initial occupancy of the Project. Annual rent increases shall be based on the change in permissible rents published annually by HUD. OCCHC may annually make any rent adjustment pursuant to the terms of this Regulatory Agreement. At least 60 calendar days prior to increasing rents on any Unit restricted by this Regulatory Agreement,OCCHC shall submit to the Agency for review and approval a written request for such increase. Households occupying Units restricted by this Regulatory Agreement shall be given at least 30 clays%vritten notice prior to any rent increase. 3.3 CONDOMINIUM CONVERSION. OCCHC shall not convert Project units to condominium or cooperative ownership or sell condominium or cooperative conversion rights to the Property during the term of this Regulatory Agreement. 3.4 NONDISCRIMINATION. OCCHC shall not discriminate or segregate in the use, enjoyment,occupancy,conveyance, lease, sublease,or rental of Project units on the basis of race, Attachment No.4 Page 4 of 13 41AAgrcc:Quccns:AttacM\1 14 N6 RrS 96-758 color,ancestry,national origin,religion, sex,sexual preference,age,marital status,family status, source of income,physical or mental disability,Acquired Immune Deficiency Syndrome(AIDS) or AIDS-related conditions (ARC),or any other arbitrary basis. OCCHC shall include a statement in all advertisements,notices and signs for the availability of Project units for rent to the effect that OCCHC is an Equal Housing Opportunity Provider. ARTICLE 4. PROPERU'hJAN GA_EMENT 4.1 MANAGEMENT RESPONSIBILITIES. OCCHC is responsible for all management functions with respect to the Project,including without limitation the selection of tenants,certification and recertification of household size and income,evictions,collection of rents and deposits,maintenance, landscaping,routine and extraordinary repairs,replacement of capital items,and security.The Agency shall have no responsibility over management of the Project. The Site shall be occupied,used and maintained as follows: A. IL-&. Each dwelling unit shall be used only for private apartment dwelling purposes, with appurtenant facilities,and for no other purposes. B. SiM. All signs on the property shall conform with all ordinances and other regulations of the Agency-. C. H=. OCCHC and the occupants shall not permit or suffer anything to be done or kept upon said premises which will increase the rate of insurance on any building,or on the contents thereof,or impair the structural integrity thereof or which will obstruct or interfere with the rights of other occupants,or annoy them by unreasonable noises or otherwise,nor shall any occupant commit or permit any nuisance on the premises or fail to keep to premises free of rubbish,clippings and trash or commit or suffer any illegal act to be committed thereon. OCCHC shall comply with all of the requirements of all governmental authorities with respect to the premises. If by reason of the occupancy or uses of the premises the rate of insurance on the Site shall be increased, OCCHC shall become personally liable for the additional insurance premiums. D. Improvem;nts. There shall be no structural alteration,construction or removal of any building,fence or other structure on the Site(other than repairs or rebuilding permitted herein)without the approval of the Agency or the Agency and in accordance with the Agency Code. Attachment No.4 Page 5 of 13 4 A\Agrce:Qucens:Attach4111/04196 RLS 96-758 E. pang. OCCIiC shall not permit the parking,storing or keeping of any vehicle except wholly within the parking areas designated therefor. OCCIiC shall not permit the parkins,storing or keeping of any large commercial type vehicle(dump truck,cement mixer truck, oil or gas truck,etc.),or any recreational vehicle(camper unit,camper shell detached from a private passenger vehicle,motor home,trailer,boat trailer,mobile home or other similar vehicle,except when parked within an enclosed parking space),boats over twenty(20) feet in length or any vehicle other than a private passenger vehicle upon any portion of the Site, including parking spaces. OCCF iC shall not permit major repairs or major restorations of any motor vehicles,boat,trailer,aircraft or other vehicle to be conducted upon any portion of the Site, including parking spaces,except for emergency repairs thereto and then only to the extent necessary to enable movement thereof to a proper repair facility. No inoperable vehicle shall be stored or kept anywhere on the Site. OCC11C shall have the right to remove,at the tenant's expense,any vehicle parked, stored or kept in violation of the provisions of this Declaration. In addition,all provisions of the Huntington Beach Municipal Code, including amendments thereto, shall apply. F. Occupancy. Occupancy of each dwelling unit shall be restricted to occupancy standards set forth in the Huntington Beach Municipal Code or state standards,as are effective or as may be effective or amended. OCCHC shall not be permitted to lease or rent any dwelling unit thereon for transient or hotel purposes. Any lease or rental agreement covering an apartment shall provide that the terms of the lease or rental agreement shall be subject in all respects to the provisions of this Declaration of Conditions,Covenants and Restrictions and that any failure by the lessee to comply with the terms of such documents shall be a default under the lease or rental agreement. All leases and rental agreements shall be in writing. All prospective tenantsloccupants of the Site shall make application through OCCHC. G. Inspection. To the extent permitted by law,the City of Huntington Beach and the Agency shall have the right of entry,at reasonable business hours and upon no less than twenty-four(24)hours advance notice,onto the Site to inspect for the need for repairs or maintenance. Entry onto the Site or into any unit for other than emergency repairs may be made only after such advance notice and request for entry. If request for entry is denied or the Site or any applicable unit is unoccupied,the City or Agency may apply for an appropriate%%arrant or other order from a court of appropriate jurisdiction. H. Subdivision. No part of the Site shall at any time be owned by a cooperative housing corporation, nor shall OCCIiC take any steps in connection with a conversion to such ownership or uses. Other than obtaining a final subdivision map on the Site and a final subdivision public report from the California Department of Real Estate,the Developer shall not Attachment No.4 Page 6 of 13 4WAgrcc:Quccns:Anach4 Il 1/04196 RLS 96-758 take any steps in connection with a conversion of th.:Site to a condominium ownership,or with a conversion of the Site to"timeshare"ownership. I. FxtCrior Maintennace. The exterior areas of the Site shall be kept free of rubbish, debris and other unsightly or unsanitary materials. Exterior yard areas and parking areas shall be kept free of deterioration, including: potholes,cracks in asphalt so as to become uneven, unsightly surface conditions,weeds groiNing through asphalt. Perimeter fencing, landscaping and irrigation system shall be routinely inspected and maintained in good condition. Each occupant of the Site shall have the affirmative obligation to prevent what might be considered a fire hazard or a condition dangerous to the public health, safety and general welfare, or constitute an unsightly appearance or otherwise detract from the aesthetic and property values of neighboring dwelling units and properties. The following minimum performance standards for the maintenance of buildings,yards,and landscaping shall be adhered to by the Developer: I. Landscaping on the Site shall be absent of the following: a. La,,Nms with grasses in excess of six(6)inches in height. b. Untrimmed hedges. C. Trees,shrubbery, lawns and other plant life dying from lack of water or other necessary maintenance. d. Trees and shrubbery gro--%m uncontrolled without proper pruning. e. Veaetation so overgrown as to be likely to harbor rats or vermin. f. Dead,decayed or diseased trees,weeds and other vegetation. g. Inoperative irrigation system(s). 2. Yard areas shall be maintained so as to be Absent of the following: a. Broken or discarded furniture, appliances and other household equipment stored in yard areas for periods exceeding one(1)week. Attachment No.4 Page 7 of 13 4'&-Mgrce:Qucens:Attach411 I/o4196 RLS 96-758 b. Packing boxes, lumber,trash,dirt and other debris stored in yards for unreasonable periods in areas visible from public property or neighboring properties. C. Unscreened trash cans,bins or containers stored for unreasonable periods in areas visible from public streets and common areas. 3. No buildir_g,wall or fence may be lei3 in an unmaintained condition so that any of the following exist: a. Buildings abandoned,boarded up,partially destroyed or left unreasonably in a state of partial construction. b. Unpainted buildings or buildings with peeling paint in such a condition as to: i. Cause dry rot,warping and termite infestation; or ii. Constitute an unsightly appearance that detracts from the aesthetic or property values of neighboring properties. C. Broken windows,constituting hazardous conditions andlor inviting trespassers and malicious mischief. d. Damaged garage doors that may become inoperative or unsafe to operate. C. Graffiti remaining on any portion of the property for a period exceeding 72 hours. f. Building interiors and exteriors shall be maintained to meet standards of similar residential property in the Agency of Huntington Beach. J. Agencv and City RiehtofReyievy amii_Enforcement. The City of Huntington Beach("City")and the Agency shall be made parties to this Declaration for the limited purpose as specified herein as follows: 1. Changes or amendments to this Declaration must be submitted for City and Agency review and approval. Attachment No.4 Page 8 of 13 41\Agrcc:Quccns:Attach4 M104196 RLS 96-758 2. In the event of inaction by the Developer,the City and Agency are hereby granted expedient power to enforce all provisions of this Declaration including,but not limited to,the maintenance of the Improvements and all yards,buildings and landscaping areas within the Site. 3. The City and Agency are hereby granted the express power to enforce all laws and ordinances of the State of California and/or the Agency on yards, structures,and private parking areas within the Site. Nothing within this Declaration,however, shall be construed as imposing an obligation or requiring the City or Agency to enforce any provision thereof. 4. The City and the Agency shall be given prior written notice of any proposed amendment to this Declaration. Such notice shall be given by mailing a copy of the precise language of the proposed amendment to the City of Huntington Beach, c/o City Clerk, together with a letter of transmittal explaining the proposed change in general terms. The City and the Agency shall have an opportunity to review and comment upon the proposed amendment for a period of not less than forty-five(45)days prior to the effective date of any such proposed amendment. If the City or Agency fail to respond within forty-five(45)days,the proposed change(s)and amendment(s)shall be deemed approved,unless that time period is extended by mutual agreement of all parties. K. !City of Beach Right of Intl► for Code Enforcement_ Repair and ItnMg Regulation. I. Right QfEntry. To the extent permitted by law, OCCHC hereby acknowledges and intends and thus grants to the City or Agency,through the City or Agency's duly authorized agents or employees,the right to enter upon the Site for the following purposes: a. Inspection,maintenance and repair of the Site. b. Enforcement of local traffic and/or parking regulations. 2. Reimbursement of Agency Rxpenditures. All costs and expenses incurred by the City and Agency arising out of its inspection,maintenance and repair of the Site,as provided hereinabove("City Maintenance Costs'),shall be charged as an expense of the Developer and shall be paid within ten(I0)days of receipt of an invoice for same. 4.2 INSPECTION AND RECORDS. OCCHC shall maintain records which clearly document OCCHC's performance of its obligations to operate the Property under the terms of Attachment No.4 Page 9 of 13 4'&AAr,rce:Quetns:Ariath3111/04196 RLS 96-758 this Regulatory Agreement. OCCHC shall submit any records to the City or Agency within ten (10)business days of the City's or Agency's request. OCCHC shall permit the Agency to enter and inspect the Project for compliance with obligations under this Regulatory Agreement upon 24 hours advance notice of such visit by the Agency to OCCHC and to tenants of any inspected Project units. 4.3 FEES,TAXES,AND OTHER LEVIES. OCCHC shall be responsible for the payment of all fees,assessments,taxes,charges and levies imposed by any public authority or utility company with respect to the Property,and shall pay such charges prior to delinquency. However,neither Borrower nor the Partnership shall be required to pay and discharge any such charge so long as(a)the legality thereof is being cor_tested diligently and in good faith and by appropriate proceedings,and(b)if requested by Lender,Borrower or the Partnership deposits with Lender any funds or other forms of assurance Lender in good faith from time to time determines appropriate to protect Lender from the consequences of the contest being unsuccessful. 4.4 INSURANCE. OCCHC shall maintain insurance in full force and effect during the term of this Agreement in an amount at least equal to the replacement cost of the Project. 4.5 COMPLIANCE WITH HOME PROGRAM REQUIREMENTS. Borrower shall comply with all requirements imposed on projects assisted under the HOME program including 24 C.F.R. Part 92,and other implementing rules and regulations. ARTICLE 5. OFNFRAL_P_ROVISIONS 5.1 SUBORDINATION. This Regulatory Agreement shall be subordinated in priority only to the liens created by the deeds of trust securing the construction and permanent loans for the Project, and other liens and encumbrances otherwise approved in writing by the Agency in its sole and absolute discretion. 5.2 DEFAULT AND REMEDIES. In the event of any breach of any agreement or obligation under this Regulatory Agreement by OCCHC,the Agency shall give written notice to OCCHC of such breach. OCCHC shall have an opportunity to cure such breach within thirty (30)days of its receipt of such written notice or such longer period of time if OCCIIC is diligently undertaking to cure such breach. If OCCFIC fails to perform a timely cure of the specified breach,the Agency may proceed with any or all of the following remedies upon OCCHC's failure to cure: Attachment No.4 Page 10 of 13 4'1lAgrce:Qucens:Attach4111/04S6 RiS 96-759 A. Bring an action in equitable relief seeking the specific performance by OCCIIC of the terms and conditions of this Regulatory Agreement,and/or enjoining,abating,or preventing any violation of said terms and conditions,and/or seeking declaratory relief; B. Af,er notice provided for herein,make such repairs or replacements to the Property and Project as are necessary and provide for payment thereof, or C. Pursue any other remedy allowed at law or in equity. 5.3 NON-LIABILITY OF OFFICIALS, EMPLOYEES AND AGENTS. The City and Agency shall not be personally liable to OCCHC for any obligation created under the terms of this Regulatory Agreement except in the case of fraud or willful misconduct by such person. 5.4 GOVERNING LAW. This Regulatory Agreement shall be interpreted under and be governed by the laws of the State of California,except for those provisions relating to choice of law and those provisions preempted by federal law. 5.5 REGULATORY AGREEMENT CONTROLS. In the event that any provisions of this Regulatory Agreement and any Loan Document conflict,the terms of the Regulatory Agreement shall control. 5.6 ATTORNEYS'FEES AND COSTS. In the event that any legal or administrative action is commenced to interpret or to enforce the terms of this Regulatory Agreement,each party shall bear its o%%m attorneys' fees and costs. The prevailing party in any such action shall not be entitled to recover any attorneys' fees and costs incurred in such action. 5.7 TIME. Time is of the essence in this Regulatory Agreement. 5.8 CONSENTS AND APPROVALS. Any consent or approval of the City and Agency required under this Regulatory Agreement shall not be unreasonably withheld. Any approval must be in«citing and executed by an authorized representative such party. 5.9 NOTICES,DEMANDS AND COMMUNICATIONS. Formal notices,demands and communications between OCCHC and the Agency shall be sufficiently given and shall not be deemed given unless dispatched by registered or certified mail,postage prepaid,return receipt requested,or delivered personally,to the principal offices of OCCIiC and the Agency as follows: Attachment No.4 Page 11 of 13 4`blASr=Quecns:AUach4 I11104 96 RLS W758 Agency: Redevelopment Agency of the City of Huntington Beach 2000 Main Street Iuntington Beach,CA 92548 Attention: Office of the Executive Director 0CC11C: Orange County Community Housing Corporation 1833 E. 17th Street, Suite 207 Santa Ana,CA 92701 Attention: Executive Director 5.10 BINDING UPON SUCCESSORS. All provisions of this Regulatory Agreement shall be binding upon and inure to the benefit of the heirs,administrators,executors,successors- in-interest,transferee,and assigns of OCCHC,the Partnership and the Agency,and shall run with the land for the full term of this Regulatory Agreement,regardless of any assignment, payment, prepayment,expiration,extinguishment of any Loan or Note,any reconveyance of any Deed of Trust, or any conveyance or transfer of the Property. 5.11 RELATIONSHIP OF PARTIES. The relationship of OCCHC,and the Agency for this Project during the term of this Regulatory Agreement shall not be construed as a joint venture,equity venture,or partnership. Except as the Agency may specify in writing, OCCHC shall have no authority to act as an agent of the Agency or to bind the Agency to any obligation. 5.12 NVAIVER. Any waiver by the Agency of any obligation in this Regulatory Agreement must be in writing. No waiver will be implied from any delay or failure by the Agency to take action on any breach or default of OCCHC to pursue any remedy allowed under this Regulatory Agreement or applicable law. Any extension of time granted to OCCHC to perform any obligation under this Regulatory Agreement shall not operate as a waiver or release from any of its obligations under this Regulatory Agreement. Consent by the Agency to any act or omission by OCCHC shall not be construed to be a consent to any other or subsequent act or omission or to waive the requirement for the Agency's%Titten consent to future waivers. 5.13 AMENDMENTS AND MODIFICATIONS. Any amendments or modifications to this Regulatory Agreement must be in writing, and shall be made only if executed by both OCCHC and the Agency. Attachment No.4 Page 12 of 13 ft\Agmc:Qucens:Atmch4\11104196 R1.S 96-758 5.14 SEVERABILITY. Every provision of this Regulatory Agreement is intended to be severable. If any provision of this Agreement shall be held invalid, illegal, or unenforceable by a court of competent jurisdiction,the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired. IN WITNESS WHEREOF,the parties hereto have executed this Regulatory Agreement by and through their authorized officers as of the date first above written. OCCHC: AGENCY: Orange County Community Housing Redevelopment Agency of the City Corporation, a California Non Profit of Huntington Beach, a California Public Benefit Corporation public body 02'r.� By: I' 1 � IChairman Its: ex'4 .' -%-'Q I>R�ca�7l By: ATTEST: Its: Agency Clerk INITIATED AND APPROVED APPROVED AS TO FORM: Executive Director ( /Agency Attorney 11��I�b 11�4176 REVIEWED AND APPROVED: -1/w ector of Ec omic Development Attachment No.4 Page 13 of 13 4\k\Agree:Queens:Attach4\11/04/96 RLS 96-758 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT State of �r 60 a.111 l� County of Olt&4V1G On I7AX 1, before me, Date Name and Tiff t Officer(e 9..'Jww Ooe,Notary PubMc7 personally appeared t-Lt N&TWS)of s w(s) ❑personally known to me—OR proved to me on the basis of satisfactory evidence to be the persoloo whose nameQ4Cs,1re subscribed to the within instrument and acM3gledged to me thatee shefthey executed the s me in I erltheir authorized capacity('.and that by qjt5aierltheir signature(Con the instrument the person), or the entity upon behalf of which the person(6 acted, (aw C�IAtS7WFA•GAIN�to00 executed the instrument. Comrrldcn#tC7.%0 Notary Pubtl--—Coltm*m Orcnge rtry WITNESS my hand and official s Comm.Exptrec Oct 22,1449 r"twe of Notary Pubic OPTIONAL Though the information below is n3r required by law,n may prove valuable to persons retying on Me document and could prevent frauc'Went removal and reattachment of this form to another document. Description of Attached Document Title or Type of Document: Document Date: Number of Pages: Signer(s)Other Than Named Above: Capacity(ies) Claimed by Signer(s) Signer's Name: Signer's Name: ❑ Individual ❑ Individual ❑ Corporate Officer ❑ Corporate Officer Title(s): Title(s): ❑ Partner—❑ Limited ❑General ❑ Partner—❑ Limited ❑General ❑ Attomey-in-Fact ❑ Attomey-in-Fact ❑ Trustee ❑ Trustee ❑ Guardian or Conservator ❑ Guardian or Conservator ❑ Other. lop Ot thumb mere ❑ Other: Top of vxvrb here Signer Is Representing: Signer Is Representing: a 1994 Nat**Notary Association•8M Rommel Ave..P.O.Boa 7184•Canopa Park.CA 91309-7184 Prod.No.SW? Reorder.Cal To&Free 1.W-676.6827 . CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT State of County of On beforeme, ldu►� Q, NAP-�S�->�� �llbf �i�foL�G Date Ham+and Tale a1 Onx w(a.g..'Jana ry Publ c personally appeared Name(s)d Sgr"a) Xi,personally known to me—OR—g faroved-bv-mem"e basis-of4atisfactoty evidence to be the persor�o whose name( 94�+ subscribed to the within Instrument and acknowledge to me thatte/s e?executed the same in his/hp<&Ibauthorized capacity ie ),and that b r>ti,�s'ignaturq(s..on the instrument the persarS(s} LAURAAN--UON or the entity upon behalf of which the personoacted, Ccnurtuion 4 tOM26 execu'e•d the instrument. ✓tirotwy PLM—Colfomia oRM1GECOUNN WITNESS ray-hand and official seal. 61mv Comm.Eq)irer.id 23.1999 i SWature of Notary Pubic PTIONAL Though Me tnlomration below is rot required by taw,it may prove valuable to persons relying on the dxument and could prevent fraudulent removal and reattachment of 71is form to another document. Description of Attached Document Title or Type of Document: �X��eW►� — 3 Z�- Q Lue44S Let PL� Document Date: i (9 9 it Number of Pages: ) 4' Signer(s)Other Than Named Above: 7ue&J-hoc Lrect�, AlttU �'/�(US,a Pjfo� (�iyid&4,15 _ Capacity(les) Claimed by Signer(s) Signer's Name: DO-V 9"VP k.\ Signer's Name: ❑ Individual ❑ Individual ❑ Corporate Officer ❑ Corporate Officer Title(s): Title(s): ❑ Partner—❑ Limited ❑General ❑ Partner—❑ Limited ❑General ❑ Attomey-in-Fact ❑ Attomey-in-Fact ❑ Trustee ❑ Trustee ❑ Guardian or Conservator ❑ Guardian or Conservator V Other: �tiLI t f IN M — Top o1 inumt sere '0) Other. z •1 t Top of VnXn,Hera Signer Is Representing: Signer Is Representing: Itc(Z nf' 1 1L h nl1 � � thnl j�jl[cl�r�. e 0 1994 NtalonN Notary Assodstoon+W30 Remmet Ave..P.O.Box 7184+Canoga Park CA 9T909.7161 Prod.No.59C7 Reader.Cal TcFFree 1-NO-876OW Exhibit"A" to Regulatory Agreement Legal Description 17422 Queens Lane Lot 14 of Tract No.4153, in the Agency of Huntington Beach,County of Orange,State of California,as per map recorded in Book 174,pages 12 and 13 of miscellaneous maps, in the office the County Recorder of said county,except all subsurface water,as dedicated on the map of the Tract and as conveyed to the Agency of Huntington Beach in deed recorded February 20, 1963 in book 6418,page 408 of official records,without the right of entry to the surface and subsurface area to a depth of 500 feet for the purpose of producing water. ; Exhibit"A"to Attachment 4 Page 1 of 1 4\k\Agrce:Queens:Attach 4%I 1 J64196 Rt.s 96-758 RECORDING REQUESTEDBY STEWART TITLE Recorded in the county of orange, California II II Gary L.IIGranville. Clerk/Recorder No Fee NO FEE DOCUMENT 19960658655 3: 16pm 12/31/96 005 15005997 15 33 Al2 16 7.00 45.00 0.00 0.00 0.00 0.00 Recording requested by and When recorded,mail to: ^ City of Iuntington Beach 2000 Main Street Huntington Beach,CA 92648 Attn: City Clerk M r { r•Ch rn rn ►� -�VL sD r- r REGULATORY AGREEMENT BY AND BET«'EEN THE REDEVELOI'tiIENT_O � AGENCY OF THE CITY OF HUNTINGTON BEACH AND ORANGE COUNTY COMMUNITY HOUSING CORPORATION CONCERNING THE ACQUISITION AND REHABILITATION OF AFFORDABLE HOUSING AT 17422 QUEENS LANE WITH v FUNDS OBTAINED FROM THE HOME INVESTMENT PARTNERSHIP PROGRAM r h This Regulatory Agreement is made this- _day of jjpt1fM fK , 1996, by and between the Redevelopment Agency of the City of Huntington Beach,a public body(the "Agency"),and Orange County Community Housing Corporation,a California public benefit corporation("OCCHC"). RECITALS WHEREAS, OCCIIC intends to purchase a four-unit building on Queens Lane in the City of Huntington Beach;and OCCIIC desires that all of the Project's units be rented at prices affordable to low income households; and The Redevelopment Agency has received a commitment of funds from the City of Huntington Beach. The City has received Home Investment Partnership Program funds ("HOME Funds") from the United States Department of Housing and Urban Development Attachment No.4A Page I of 13 41k1Agree:Queens:Attach4A 11 110 419 6 RLS 96-758 ("HUD")pursuant to the Cranston-Gonzales National Housing Act of 1990 for the purpose of expanding the supply of decent,safe,sanitary and affordable housing for very-low and low- income persons and families; and OCCHC has received a loan from the Agency of HOME Funds to support the acquisition and rehabilitation of the Project,and the funds have been made available in order to help achieve financial feasibility for the Project and maximize the affordability of Project units;and As further consideration for this funding and to further the interests of the Agency, Agency and OCCHC have agreed to enter into and record this Regulatory Agreement. The purpose of this Regulatory Agreement is to regulate and restrict the occupancy,rents,operation, ownership,and management of the Project. The covenants in this Regulatory Agreement are intended to run with the land and be binding on OCCHC and its successors, NOW THEREFORE, IN CONSIDERATION of the mutual agreements, obligations,and representations, and in further consideration for the aforementioned funding,OCCHC,and Agency hereby agree as follows: ARTICLE 1. DEFINITIONS The following tenns have the meanings and content set forth in this section wherever used in this Regulatory Agreement or attached exhibits. 1.1 "AREA MEDIAN INCOME" means the median income for the Orange County Primary Metropolitan Statistical Area(PMSA),with adjustments for household size,as determined from time to time by the U.S. Department of housing and Urban Development (HUD)pursuant to the United States Housing Act of 1937 as amended, or such other method of median income calculation applicable to the Agency that HUD may hereafter adopt in connection ,Kith said Act. 1.2 "AGENCY"means the Redevelopment Agency of the City of Huntington Beach, a public body,and its officers,officials,directors, employees,agents and authorized representatives. 1.3 "DEED OF TRUST" means the deed of trust,placed on the Property as security for the Loan,.tinth OCCHC as trustor and the Agency as beneficiary,as well as any amendments to, modifications of,and restatements of said deed of trust. 1.4 "HOME" means Home Investment Partnership Program created by the National Affordable Housing Act of 1990. Attachment No.4A Page 2 of 13 4%k\Agsrt:0%=ns:At1ach4 A 11 1104196 W 96-758 1.5 "LOAN" means any loan of funds provided by the Agency to OCCFiC for the Project. 1.6 "LOAN DOCUMENTS" means collectively the Deed of Trust,Note,and this Regulatory•Agreement as they may be amended, modified,or restated from time to time,along with all exhibits and attachments to these documents. 1.7 "NOTE" means the promissory note executed by OCCIIC in favor of the Agency evidencing the Loan,which is secured by the deed of trust,as well as any amendments to, modifications of, or restatements of said promissory note. 1.8 "PROJECT"means the four(4)units of rental housing on the Property to be owned and operated by OCCIiC for Very Low-Income Households. 1.9 "PROPERTY" means the real property described in the attached Exhibit A,which is hereby incorporated into this Regulatory Agreement by this reference. 1.10 "VERY LOW-INCOME HOUSEHOLD" means a household whose annual income does not exceed fifty percent(50%)of the median income for the Orange County PMSA as determined by IIUD with adjustments for smaller and larger households. 2.1 "UNIT" means a housing unit in the Project. ARTICLE 2. OCCIIC'S OBLIGATIONS 2.1 COMPLIANCE WITH LOAN DOCUMENTS. OCCHC's actions%%ith respect to the Property And the use of Loan funds shall at all times be in full conformity with all of the requirements of the Loan Documents. 2.2 TERM OF AGREEMENT. This Regulatory Agreement shall commence upon execution and shall remain in full force and effect fo;thirty(30)years. 2.3 COMPLIANCE WITH PROGRAM REQUIREMENTS. OCCHC shall comply with all requirements imposed on projects assisted under the HOME Program as contained in 42 U.S.C. Sections 12701,et seq., 24 C.F.R. Part 92,and other implementing rules and regulations. Attachment Na.4A Page 3 of 13 41k1Agme:Queens:Anach4A\11/04196 RLS 96-758 ARTICLE 3. PROJECT OCCUPANCY AND RENTS 3.1 OCCUPANCY OF PROJECT. OCCHC shall limit for the full term of this Regulatory Agreement the rental of all four(4)Units to Very Low-Income Households at no more than the maximum rental charges set forth in this Regulatory Agreement. The Units restricted by this Regulatory Agreement shall consist of four(4)two-bedroom units. Tire income levels and other qualifications of Very Low-Income Household applicants for Units shall be certified prior to initial occupancy and recertified yearly by OCCHC. In the event that recertification of a Very Low-Income Household's Lricome indicates that the income exceeds the maximum income designated for a Very Low-Income Household,OCCHC shall adjust the household's rent to equal the lesser of(a)thirty percent(30%)of the household's gross income or (b)the fair market rental of the unit. In addition, OCCHC shall rent the next available Project unit to a Very Low-Income Household. 3.2 MAXIMUM RENTAL CHARGES. The total charges for rent,utilities, and related services to Very Low Income Household sha'.l not exceed thirty percent(30%)of fifty percent(50%)of Area Median Income adjusted for family size. Fifty percent(50%)of Area Median Income for a three(3)person family shall be assumed for a two(2)bedroom unit and fifty percent(50%)of Area Median Income for a five(5)person family for a three-bedroom unit. Initial rents for each Unit shall be approved by the Agency at the time of initial occupancy of the Project. Annual rent increases shall be based on the change in permissible rents published annually by HUD. OCCHC may annually make any rent adjustment pursuant to the terms of this Regulatory Agreement. At least 60 calendar days prior to increasing rents on any Unit restricted by this Regulatory Agreement,OCCHC shall submit to the Agency for review and approval a written request for such increase. Households occupying Units restricted by this Regulatory Agreement shall be given at least 30 days-,vritten notice prior to any rent increase. 3.3 CONDOMIMUM CONVERSION. OCCHC shall not convert Project units to condominium or cooperative ownership or sell condominium or cooperative conversion rights to the Property during the term of this Regulatory Agreement. 3A NONDISCRIMINATION. OCCHC shall not discriminate or segregate in the use, enjoyment,occupancy,conveyance, lease, sublease, or rental of Project units on the basis of race, color, ancestry,national origin,religion, sex,sexual preference,age, marital status, family status, source of income,physical or mental disability,Acquired Immune Deficiency Syndrome(AIDS) or AIDS-related conditions(ARC), or any other arbitrary basis. OCCIIC shall include a statement in all advertisements,notices and signs for the availability of Project units for rent to the effect that OCCHC is an Equal Housing Opportunity Provider. Attachment No.4A Page 4 of 13 ,r%k%Agrcc:Quccns:Anach4A%11/04,96 RLS 96-758 ARTICLE 4. RROPERTY MANAGEMENT 4.1 MANAGEMENT RESPONSIBILITIES. OCCHC is responsible for all management functions with respect to the Project, including without limitation the selection of tenants,certification and recertification of household size and income, evictions,collection of rents and deposits, maintenance, landscaping,routine and extraordinary repairs, replacement of capital items,and security.The Agency shall have no responsibility over management of the Project. The Site shall be occupied,used and maintained as follows: A. III. Each dwelling unit shall be used only for private apartment dwelling purposes, with appurtenant facilities,and for no other purposes. B. Sim. All signs on the property shall conform with all ordinances and other regulations of the Agency. C. E . OCCIIC and the occupants shall not permit or suffer anything to be done or kept upon said premises which will increase the rate of insurance on any building,or on the contents thereof, or impair the structural integrity thereof or which will obstruct or interfere with the rights of other occupants, or annoy them by unreasonable noises or othen%ise,nor shall any occupant commit or permit any nuisance on the premises or fail to keep to premises free of rubbish, clippings and trash or commit or suffer an), illegal act to be committed thereon. OCCIIC shall comply with all of the requirements of all governmental authorities with respect to the premises. If by reason of the occupancy or uses of the premises the rate of insurance on the Site shall be increased,OCCIIC shall become personally liable for the additional insurance premiums. D. Improymcnts. There shall be no structural alteration,construction or removal of any building, fence or other structure on the Site (other than repairs or rebuilding permitted herein)without the approval of the Agency or the Agency and in accordance with the Agency Code. E. Earkin . OCCHC shall not permit the parking,storing or keeping of any vehicle except wholly within the Farking areas designated therefor. OCCHC shall not permit the parking, storing or keeping;of any Iarge commercial type vehicle(dump truck,cement mixer truck,oil or gas truck,etc.),or any recreational vehicle (camper unit, camper shell detached from a private passenger vehicle,motor home,trailer,boat trailer,mobile home or other similar vehicle,except when parked within an enclosed parking space), boats over twenty(20) feet in length or any vehicle other than a private passenger vehicle upon any portion of the Site, including parking spaces. OCCIIC shall not permit major repairs or major restorations of any Attachment No.4A Page 5 of 13 4'1\Agrcc:Quccns:Attach4A 11 M196 RLS 96-758 motor vehicles,boat,trailer,aircraft or other vehicle to be conducted upon any portion of the Site,including parking spaces,except for emergency repairs thereto and then only to the extent necessary to enable movement thereof to a proper repair facility. No inoperable vehicle shall be stored or kept anywhere on the Site. OCCFIC shall have the right to remove,at the tenant's expense,any vehicle parked,stored or kept in violation of the provisions of this Declaration. In addition,all provisions of the Huntington Beach Municipal Code,including amendments thereto, shall apply. F. Occupamsy. Occupancy of each dwelling unit shall be restricted to occupancy standards set forth in the Huntington Beach Municipal Code or state standards,as are effective or as may be effective or arrended. OCCHC shall not be permitted to lease or rent any dwelling unit thereon for transient or hotel purposes. Any lease or rental agreement covering an apartment shall provide that the terms of the lease or rental agreement shall be subject in all respects to the provisions of this Declaration of Conditions,Covenants and Restrictions and that any failure by the lessee to comply with the terms of such documents shall be a default under the lease or rental agreement. All leases and rental agreements shall be in writing. All prospective tenants/occupants of the Site shall make application through OCC11C. G. lluMCtion. To the extent permitted by law,the City of Huntington Beach and the Agency shall have the right of entry,at reasonab'e business hours and upon no less than twenty-four(24)hours advance notice,onto the Site to inspect for the need for repairs or maintenance. Entry onto the Site or into any unit for other than emergency repairs may be made only after such advance notice and request for entry. If request for entry is denied or the Site or any applicable unit is unoccupied,the City or Agency may apply for an appropriate warrant or other order from a court of appropriate jurisdiction. H. Subdivisim. No part of the Site shall at any time be owned by a cooperative housing corporation, nor shall OCCHC take any steps in connection with a conversion to such ownership or uses. Other than obtaining a final subdivision map on the Site and a final subdivision public report from the California Department of Real Estate,the Developer shall not take any steps in connection with a conversion of the Site to a condominium ownership,or Ivith a conversion of the Site to"timeshare"ownership. 1. E2;teriar M om. The exterior areas of the Site shall be kept free of rubbish, debris and other unsightly or unsanitary materials. Exterior yard areas and parking areas shall be kept free of deterioration, including:potholes,cracks in asphalt so as to become uneven, unsightly surface conditions, weeds growing through asphalt. Perimeter fencing, landscaping and irrigation system shall be routinely inspected and maintained in good condition. Each occupant of the Site shall have the affirmative obligation to prevent what might be considered a fire hazard or a condition dangerous to the public health, safety and general welfare; Attachment No.4A Page 6 of 13 N%klAgree:Quecns:Anach4A 111104M6 RLS 96-758 or constitute an unsightly-appearance or otherwise detract from the aesthetic and property values of neighboring dwelling units and properties. The following minimum performance standards for the maintenance of buildings,yards,and landscaping shall be adhered to by the Developer: I. Landscaping on the Site shall be absent of the following: a. Lawns with grasses in excess of six (6) inches in height. b. Untrimmed hedges. C. Trees,shrubbery,lawns and other plant life dying from lack of water or otter necessary maintenance. d. Trees and shrubbery grown uncontrolled Nsithout proper pruning. e. Vegetation so overgrown as to be likely to harbor rats or vermin. f. Dead,decayed or diseased trees,weeds,and other vegetation. g. Inoperative irrigation system(s). 2. Yard areas shall be maintained so as to be absent of the followng: a. Broken or discarded furniture,appliances and other household equipment stored in yard areas for period;exceeding one(1)week. b. Packing boxes, lumber,trash, dirt and other debris stored in yards for unreasonable periods in areas visible from public property or neighboring properties. C. Unscreened trash cans, bins or containers stored for unreasonable periods in areas visible from public streets and common areas. 3. No building;,wall or fence may be fell in an unmaintained condition so that any of the following exist: a. Buildings abandoned,boarded up,partially destroyed or left unreasonably in a state of partial construction. b. Unpainted buildings or buildings with peeling paint in such a condition as to: Attachment No.4A Page 7 of 13 CL Agree:Quecns:Attach4A 111104/96 RLs W758 i. Cause dry rot,warping and termite infestation;or ii. Constitute an unsightly appearance that detracts from the aesthetic or property values of neighboring properties. C. Broken windows,constituting;hazardous conditions and/or inviting trespassers and malicious mischief. d. Damaged garage doors that may become inoperative or Unsafe to operate. e. Graffiti remaining on any portion of the property for a period exceeding 72 hours. f. Building;interiors and exteriors shall be maintained to meet standards of similar residential property in the Agency of Huntington Beach. J. Agency Md City Right of Review and Enforccment. The City of Huntington Beach("City")and the Agency shall be made parties to this Declaration for the limited purpose as specified herein as follows: 1. Changes or amendments to this Declaration must be submitted for City and Agency review and approval. 2. In the event of inaction by the Developer,the City and Agency are hereby granted expedient power to enforce all provisions of this Declaration including,but not limited to,the maintenance of the Improvements and all yards,buildings and landscaping areas-,Athin the Site. 3. The City and Agency are hereby granted the express power to enforce all laws and ordinances of the State of California and,/or the Agency on yards,structures,and private parking areas within the Site. Nothing within this Declaration,however,shall be construed as imposing an obligation or requiring the City or Agency to enforce any provision thereof. 4. The City and the Agency shall be given prior written notice of any proposed amendment to this Declaration. Such notice shall be given by mailing a copy of the precise language of the proposed amendment to the City of Huntington Beach,c/o City Clerk, together with a letter of transmittal explaining the proposed change in general terms. The City and the Agency shall have an opportunity to review and comment upon the proposed amendment for a period of not less than forty-five(45)days prior to the effective date of any such proposed amendment. If the City or Agency fail to respond within forty-five(45)days,the proposed Attachment No.4A Page 8of13 4'&AAgrce:Quccns:Attach4A%11/04/96 RCS 96-759 change(s)and amendment(s)shall be deemed approved,unless that time period is extended by mutual agreement of all parties. K. City o(Htntington Reach Rityht of Entry for Code Enforcement,Rcpair and Traffic$eguIaL 1. Ri-ht of Entry. To the extent permitted by law, OCCIIC hereby acknowledges and intends and thus grants to the City or Agency,through the City or Agency's duly authorized agents or employees,the right to enter upon the Site for the following purposes: a. Inspection, maintenance and repair of the Site. b. Enforcement of local traffic and/or parking regulations. 2. geimbursement of Aeenc,v Expendit3ires. All costs and expenses incurred by the City and Agency arising out of its inspection,maintenance and repair of the Site,as provided hereinabove("City Maintenance Costs'), shall be charged as an expense of the Developer and shall be paid within ten(10)days of receipt of an invoice for same. 4.2 INSPECTION AND RECORDS. OCCIIC shall maintain records which clearly document OCCIIC's performance of its obligations to operate the Property under the terms of this Regulatory Agreement. OCCHC shall submit any records to the City or Agency within ten (10)business days of the City's or Agency's request. OCCIIC shall permit the Agency to enter and inspect the Project for compliance with obligations under this Regulatory Agreement upon 24 hours advance notice of such visit by the Agency to OCCIIC and to tenants of any inspected Project units. 4.3 FEES,TAXES,AND OTHER LEVIES. OCCIIC shall be responsible for the payment of all fees,assessments,taxes,charges and levies imposed by any public authority or utility company with respect to the Property,and shall pay such charges prior to delinquency. However,neither Borrower nor the Partnership shall be required to pay and discharge any such charge so long as(a)the legality thereof is being contested diligently and in good faith and by appropriate proceedings,and (b) if requested by Lender, Borrower or the Partnership deposits with Lender any funds or other forms of assurance Lender in good faith from time to time determines appropriate to protect Lender from the consequences of the contest being unsuccessful. 4A INSURANCE. OCCIIC shall maintain insurance in full force and effect during the term of this Agreement in an amount at least equal to the replacement cost of the Project. Attachment No.4A Page 9 of 13 411AAgmc:Quccns:AtWch4A 111/04196 RlS 96-758 4.5 COMPLIANCE WITH HOME PROGRAM REQUIREMENTS. Borrower shall comply with all requirements imposed on projects assisted under the HOME program including 24 C.F.R. Part 92,and other implementing rules and regulations. ARTICLE 5. GENERAL-PROVISIONS 5.1 SUBORDINATION. This Regulatory Agreement shall be subordinated in priority only to the liens created by the deeds of trust securing the construction and permanent loans for the Project,and other liens and encumbrances otherwise approved in writing by the Agency in its sole and absolute discretion. 5.2 DEFAULT AND REMEDIES. In the event of any breach of any agreement or obligation under this Regulatory Agreement by OCCIIC,the Agency shall give written notice to OCCHC of such breach. OCCIIC shall have an opportunity to cure such breach within thirty (30)days of its receipt of such written notice or such longer period of time if OCCHC is diligently undertaking to cure such breach. If OCCIIC fails to perform a timely cure of the specified breach, the Agency may proceed with any or all of the following remedies upon OCCHC's failure to cure: A. Bring an action in equitable relief seeking the specific performance by OCCIIC of the terms and conditions of this Regulatory Agreement,and/or enjoining,abating,or preventing any violation of said terms and conditions,and/or seeking declaratory relief; B. After notice provided for herein,make such repairs or replacements to the Property and Project as are nycessary and provide for payment thereof;or C. Pursue any other remedy allowed at law or in equity. 5.3 NON-LIA131LITY OF OFFICIALS,EMPLOYEES AND AGENTS. The City and Agency shall not be personally liable to OCCHC for any obligation created under the terms of this Regulatory Agreement except in the case of fraud or willful misconduct by such person. SA GOVERNING LAW. This Regulatory Agreement shall be interpreted under and be governed by the laws of the State of California,except for those provisions relating to choice of law and those provisions preempted by federal law. 5.5 REGULATORY AGREEMENT CONTROLS. In the event that any provisions of this Regulatory Agreement and any Loan Document conflict,the terms of the Regulatory Agreement shall control. Attachment No.4A Page 10 of 13 41&AAgrcc:Quccns:Attach4A%11/04196 RiS 46-758 5.6 ATTORNEYS'FEES AND COSTS. In the event that any legal or administrative action is commenced to interpret or to enforce the terms of this Regulatory Agreement,each party shall bear its own attorneys' fees and costs. The prevailing part},in any such action shall not be entitled to recover any attorneys'fees and costs incurred in such action. 5.7 TIME. Time is of the essence in this Regulatory Agreement. 5.8 CONSENTS AND APPROVALS. Any consent or approval of the City and Agency required under this Regulatory Agreement shall not be unreasonably withheld. Any approval must be in writing and executed by an authorized representative of such party. 5.9 NOTICES, DEMANDS AND COMMUNICATIONS. Formal notices,demands and communications between OCCHC and the City and Agency shall be sufficiently given and shall not be deemed given unless dispatched by registered or certified mail,postage prepaid, return receipt requested,or delivered personally,to the principal offices of OCCHC and the Agency as follows: Agency: Redevelopment Agency of the City of Huntington Beach 2000 Main Street Huntington Beach,CA 92648 Attention: Office of the Executive Director OCCHC: Orange County Community Housing Corporation 1833 E. 17th Street, Suite 207 Santa Ana, CA 92701 Attention: Executive Director 5.10 BINDING UPON SUCCESSORS. All provisions of this Regulatory Agreement shall be binding upon and inure to the benefit of the heirs,administrators,executors, successors- in-interest,transferee,and assigns of OCCf IC,the Partnership and the Agency,and shall run «ith the land for the full term of this Regulatory Agreement,regardless of any assignment, payment,prepayment,expiration,extinguishment of any Loan or Note,any reconveyance of any Deed of Trust,or any conveyance or transfer of the Property. 5.11 RELATIONSHIP OF PARTIES. The relationship of OCCHC,and the Agency for this Project during the term of this Regulatory Agreement shall not be construed as a joint venture,equity venture,or partnership. Except as the Agency may specify in writing, OCCEIC shall have no authority to act as an agent of the Agency or to bind the City and Agency to any obligation. Attachment No.4A Page I 1 of-13 4WAgree:Quccns:A1tach4A 111/04/96 RLs 96-759 5.12 WAIVER. Any waiver by the Agency of any obligation in this Regulatory Agreement must be in writing. No waiver will be implied from any delay or failure by the Agency to take action on any breach or default of OCCFIC to pursue any remedy allowed under this Regulatory Agreement or applicable law. Any extension of time granted to OCCHC to perform any obligation u.-ider this Regulatory Agreement shall not operate as a waiver or release from any of its obligations under this Regulatory Agreement. Consent by the Agency to any act or omission by OMIC shall not be construed to be a consent to any other or subsequent act or omission or to waive the requirement for the Agency's written consent to future waivers. 5.13 AMENDMENTS AND MODIFICATIONS. Any Amendments or modifications to this Regulatory Agreement must be in writing,and shall be made only if executed by both OMIC and the Agency. Attachment No.4A Page 12 of 13 41,41Agrcc:Quctns:Attach4A\11104l96 RLs 96-759 5.14 SEVERABILITY. Every provision of this Regulatory Agreement is intended to be severable. If any provision of this Agreement shall be held invalid, illegal, or unenforceable by a court of competent jurisdiction,the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired. IN WITNESS WHEREOF,the parties hereto have executed this Regulatory Agreement by and through their authorized officers as of the date first above written. OCCHC: AGENCY: Orange County Community Housing Redevelopment Agency of the City Corporation, a California Non Profit of Huntington Beach, a California Public Benefit Corporation public body By: Chairman Its: Cke(LUCt", MJ-Lr\ By: ATTEST: Its: C��, Agency Secretary '011— INITIATED AND APPROVED APPROVED AS TO FORM: Executive Director +� Agency Attorney �1�41g� ����rt'►b REVIEWED AND APPROVED: /i IN " Ar Director of Econ uric Development 4 %10b Attachment No.4A Page 13 of 13 4\k\Agree:Queens:Attach4A\11/04/96 RLS 96-758 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT State of Chu Z ` County of to Lf w, On G 44r, Ur 00 before me, t�� `- �► Iv i1 Dare NM*"Vw TW at or Jan.me.Wev)'PL6W) - personally appeared c A LL,0 wr yu-e- C�L r4ern.(s1of Srgn.r�a) I;P�rsonally known to me-O basis-of.satisfacUny-evidence to be the persorisf] whose names is 9 subscribed to the within instrument and acknowledged to me that4*4hegH-el executed the same in NsAmxt gi authorized capacity(@634.and that by _his/helf it signatur*{ on the instrument the person in or the entity upon behalf of which the person@.acted. LAURAAMUON executed the instrument. CorrlrrWIon O10►SS263 61MY Notoryr PdAc—calbtrlla CRMOECOt>� WITNESS1ny and and official seal. Comm.Wins M 23.1999 / S"ture of Notary Pubrc 4PTIONAL Though the information below is not required by Jaw,it may prove valuable to persons relying on the document and could prevent fraudulent removal and reattachment of this form to another document. Description of Attached Document Title or Type of Document: kr d,il� - ; woti-,- 17Y7-2- awA.15 Laxt, Document Date: t ! ZA Number of Pages: Iq Signer(s) Other Than Named Above: �GXQLuhvc D�,rechr QQ fSat�,c �,i,2d�.� Capacity(ies)`Claimed by Signer(s) Signer's Name: t 1(� I t- i�� _ Signer's Name: ❑ Individual G Individual ❑ Corporate Officer ❑ Corporate Officer Title(s): Title(s): ❑ Partner•—❑ Limited ❑ General ❑ Partner—❑Limited ❑ General ❑ Attomey-in-Fact ❑ Attomey-in-Fact ❑ Trustee ❑ Trustee ❑ Guardian or Conservator ❑ Guardian r conserrvator}' 'I Other: /'I 1 1 rMr^ f1 Top or thumb here '( ,Other. �[_�f-IIL _ Top fit mumd here Signer Is Representing: Signer Is Representing: 4/ 4 0 19w Nabarwl Notary Assoaawn•eZ38 R.m w Ave.PO.Box 7184+Canoga Park,CA 91309-7184 Prod.No.5907 Awoor.Cat To&Free 1-S00-e'84W 'CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT State of County of On b! �6 _before me, GkPbSri 46 04 - (5 4f_trupd. Dale Nance ow Tine o1 Omar(e.g-.dins Doe.Notary Pubbn personally appeared . 4-t-t-c Naaloks)of sw"S) ❑personally known to me-OR-proved to me on the basis of satisfactory evidence to be the person whose nameWare subscribed to the within instrument and acknowledged to me thathelthey executed the Wme in 3her/their authorized capacity() T,and that by /herAheir signaturern the instrument the persono ,' or the entity upon behalf of which the persory"cted, (:140MI A-GA M W executed the instrument. ` C4rnrn1&Cr 1)IC?5W 7� "s NotolY PL+.=—c4lf elm orange Cow* WITNESS my hand and official seal. MV Comm.F,xpires Oet22.1W Signature d Notary Pubic OPTIONAL Though the information below is not required by law,It may prove valuable to persons relying on the document and could prevent fraudulent removal and reattachment o.'this form to another document. Description of Attached Document Title or Type of Document: Document Date: Number of Pages: Signer(s) Other Than Named Above: Capacity(ies) Claimed by Signer(s) Signer's Name: Signer's Name: ❑ Individual ❑ Individual ❑ Corporate Officer ❑ Corporate Officer Title(s): Title(s): ❑ Partner--❑ Limited ❑General ❑ Partner—❑ Limited ❑General ❑ Attorney-in-Fact ❑ Attorney-in-Fact ❑ Trustee ❑ Trustee ❑ Guardian or Conservator ❑ Guardian or Conservator ❑ Other lop of thumb Here ❑ Other. Top of mono here Signer Is Representing: Signer Is Representing: 0 19%Natcew Notary Aaspgation+8288 Rommel Ave..P.O.Box 7184•Canoga PadL CA 91309-7184 Prod.No.5901 Reorder.Car TdFFree 1.1l0OWO-6627 Exhibit"A" to Regulatory Agreement Legal Description 17432 Queens Lane Lot 15 of Tract No.4153, in the City of Huntington Beach,County of Orange, State of California,as per map recorded in Book 174,pages 12 and 13 of miscellaneous maps,in the office of the County Recorder of said county,except all subsurface water,as dedicated on the map of the Tract and as conveyed to the City of Huntington Beach in deed recorded February 20, 1963 in book 6418,page 408 of official records,without the right of entry to the surface and subsurface area to a depth of 500 feet for the purpose of producing water. Exhibit"A"to Attachment 4A Page 1 of 1 4\k'Agsaa:Queens-.Auach4A111104196 RLS 96-758 Attachment No. 5 SCOPE OF WORK r The projects are two 4-unit multifamily housing developments located at 17422 and 17432 Queens Lane, and is composed entirely of two bedroom apartments that are in average condition. Improvements planned include the rehabilitation of both the interior and exterior of the buildings. HOME funds are being provided for the acquisition of these properties. OCCHC is rehabilitating the properties with other funds. All rehabilitation work will conform to Housing Qualify Standards and all other applicable building codes, standards, and regulations. Attachment No. 5 Page 1 of 1 4Uc\Agee:Que=:Attach5\10/23/96 RL3 96-759 Attachment No. 6 SCHEDULE OF PERFORMANCE I. GENERAL PROVISIONS 1. Execution of A,_grcement-by—Agency. The Agency shall approve and execute Within thirty(30)days after the date of this Agreement and shall deliver one execution and submission of five (5) copies of (1)copy thereof to the Developer. this Agreement by the Developer. 2. ,Submission ofDeveh2pment Proposal Developer submits its Development Completed. Proposal to the Agency. 3. Preparation ofNFPA. D2cumentation Completed. 1I. REHABILITATION PHASE 4. Commencementsf Construction. Developer shall commence Within forty-five days after the Agency's construction of property rehabilitation. approval of Agreement. S. Completion of Construction. Developer shall complete construction Subject to any permissible delays,Developer is of all of the rehabilitation to use due diligence to complete the project improvements. within twelve(12)months after the start of the rehabilitation improvements; however, the Developer may request up to three(3)one(1) month extensions to be granted by the Director of Special Projects. Approval of such three extensions (but no other extensions)is not to be unreasonably withheld; provided that, notwithstanding the foregoing, construction shall be completed Attachment No. 6 Page I of 2 �fk\Q:Ag=:Quxn:AMKhaI0M96 AIS 96-758 no later than eighteen(18)months after the earlier of(i)the commencement of the rehabilitation improvements; or(ii)the time established in this Agreement for the commencement of construction of rehabilitation improvements. 11I. OPERATIONS PHASE 6. Disbursement of HON E-Funds. The Agency shall disburse the Loan. One payment for acquisition; progress payment schedule for the rehabilitation. 7. Submission of 1nrome Certification, Within thirty(30) days after execution of the Agreement; and annually thereafter to be submitted per HOtiiE regulations on July 1, for the duration of the Agreement. Attachment No. 6 Page 2 of 2 4,MAga:Quma.-Aff&&A M123,9 6 RLS 96-738 Attachment No. 7 CITY OF HUNTINGTON BEACH HOME Investment Partnership Program RENTAL PROPERTY ACQUISITION GUIDELINES HOME regulations require that a participating city adopt basic guidelines for the acquisition of existing rental property for use as HOME-funded affordable housing. The HOME program is strictly targeted for low income households, which is expressed both through household income limits and rental rate restrictions. The full text of applicable HOME regulations are provided as attachments to these guidelines and are summarized as follows: Minimum Standards 1. Costs eligible for HOME assistance are property acquisition costs,relocation costs, "hard" and "soft" costs directly related to the project. 2. The use of Federal assistance requires the developer to comply,.Kith Davis-Bacon standards. 3. At a minimum, 90%of the units must be occupied by households earning no more than 60%of the County median as adjusted for household size. Based on 1993 HUD income information,the maximum allowable income for a one person household is approximately$23,760,the two person household income is$27,120, the three person household income is$30,480 and the four person household income is$33,900, 4. At least 20%of the:project units must be occupied by households earning no more than 50%of the County median as adjusted for household size. (These units can be used in satisfying the requirement that 90%of the units be income restricted.) The 1993 HUD income standards indicate that a one person household at 50%of the County median income Mould earn$19,800,increasing to$28,250 for a four person household. 5. 100%of the units must have rents which do not exceed 30°/4 of 65%of the County median; however,at least 20%of the units must bear rents not greater than 30%of 50% of the County median. Rents can be lower,but in all cases, HUD regulations at 24 CFR 92.216 must be strictly adhered to. 6. The duration of the affordability covenants varies depending on the level of assistance provided to the project. For example,if the assistance is in excess of$40,000 per unit, Attachment 7 Pagel of 5 41s1Quccns:Attach7 I I/W"96 RL.S 96-758 the minimum affordability period is fifteen(15)years. More favorable terms will be granted for longer affordability periods(i.e.,30+years). 7. A project may contain multiple sites. In order to be considered as a single "project," the sites must be under common ownership and management,and must be located within a four block area. 8. Monitoring of a project for compliance with HOME regulations is mandatory and is governed by HOME regulations at 24 CFR 92.504(e). SUBMISSION REQUIREMENTS The City intends to review developer submissions in two stages. The first level of evaluation is a review of the developer qualifications and the conceptual scope of the proposed project. The second component of the evaluation is an analysis of the proposed projeefs deal points. Developers selected at the conclusion of this two stage process will be awarded Exclusive Rights to Negotiate related to the identified project site. It is the City's intent to analyze each of the components separately, in a sequential manner. Initially,it will only be necessary for responding developers to submit the information requested in Attachment 1 (5 copies). If the City evaluation indicates that the developer meets or exceeds the defined criteria,the proposal will then be processed further-Mth additional analysis and negotiation. Proposals should be submitted to: HOME Program Coordinator City of Huntington Beach Special Projects Division 2000 Main Street,4th Floor Huntington Beach,CA 92648 The City of Huntington Beach reserves the right to reject any and all proposals at its sole discretion. In the event that the City chooses a particular proposal for approval by the City Council,the City reserves the right to further negotiate the terms of the proposal,and may,at its discretion,require a good faith deposit as a means of defraying the City's costs during the deposition process. Attachment 7 Page 2 of 5 41s',Quecns:Attach7 11/04/96 RLS 96-758 DEVELOPER QUALIFICATIONS SUBMISSION REQUIREMENTS In reviewing the developer qualifications, the City will consider the responses to the following questions: 1. Provide a narrative description of the proposed project. This should include an identification of the proposed site, the ownership of the site, and a conceptual acquisition and/or rehabilitation plan. 2. Describe the developer's 1h= most relevant projects. Provide photographs and a brief description of these projects, including date, location, size, rehabilitation costs, specific role of the developer, etc. Also include a local government reference(name,title and telephone number)for each project cited above. 3. Describe the type of legal entity with whom the City would contract. Identify the person in charge of negotiations, and key personnel who will be involved in decision making. 4. Identify the members of the project team, including key consultants such as legal counsel, architects,etc. Specify the relevant experience of the team members and key consultants. 5. Describe the developers previous experience in the on-going management, operation and ownership of affordable housing projects. 6. Identify the anticipated long-term ownership structure of the proposed project. 7. Present evidence that the developer has the financial capability to carry out the proposed commitments. The preferred evidence is the two most recent audited financial statements of the developer. However, other evidence may be submitted at the developer's discretion. Also include the method of long-term financing both debt and equity, if any, for the three most relevant projects listed in "2" above. TO BE SUBMITTED CONFIDENTIALLY UNDER SEPARATE COVER. (Three copies only). Each project will be evaluated against several criteria and►gill be given points based on those criteria. Attachment 7 Page 3 of 5 4W.Queens:Annch7 11104t,'96 W 96-758 Affordable Housing Project Rating Sheet Name of Project: 17422 and 17432 Queens Lane Address: Criteria Points Project Laeati2a HUD enhancement area 10 Redevelopment project area 7 Low-mod census tract 5 City housing survey area rated "Poor" 3 Number of units&%of project reserved 10 for low or very low income persons Number of units and%of project reserved for special needs groups(e.g.seniors) Number of units and%of project reserved for 5 large families(3+bedrooms) Attachment 7 Page 4 of 5 4WQuccns:Anach7 11104j% RLS 96.759 Rating Sheet,Cont. Approved Community housing Development Organization 10 C'CHDO") Nonprofit housing developer 5 For-profit developer Women or minoriy owned business Long.-Term Affordability Controls Length of Affordability* 30+ 25 20-30 years TOTAL POINTS: 80 *Dependent upon the source of funds &k: *Additional consideration will be given to projects based on average unit size,cost, overall density of the project,as well as the cost of rehabilitation and other related expenses •A minimum of 40 points is required for any project to merit further consideration Attachment 7 Page 5 of 5 Cs\Qutens:Attach7 I M/96 RL$96-758 _y w i Attachment No. 8 HOME INVESTMENT PARTNERSHIP PROGRAM MULTI-FAMILY REHABILITATION LOAN PROGRAM 1. General Information A. Purpose B. Assistance C. Availability of Funds/Alternative CDBG Loan Program D. Goals 11. Guidelines A. Property Eligibility Requirements and Improvements B. Applicant Eligibility C. Loan Conditions 1II. Procedures A. Intake Activities B. Inspection C. Contractor Selection D. Financial Review E. Loan Closing F. Construction Management and Disbursement of Funds G. Loan Collection Attachment No. 8 Page 1 of'3 414A&sa:Quccns:Arxh8 RIS 96-75811/04/96 Nf IGHBORF100D ENI;IANCEMENT PROGRAM MULTI-FAMILY RENTAL HOUSING REHABILITATION LOANS I. GENERAL INFORMATION: A. Purpose To provide multi-family rental property owners with deferred payment and low interest rate loans to upgrade existing substandard apartment units. Mandated goal of the HOME Program is to improve and preserve affordable housing for low and very low income families. B. Assistance The City of Huntington Beach offers rental owners Deferred Payment Loans to rehabilitate their properties. Deferred Payment Loans may be obtained for up to 50%of the total approved cost of rehabilitation. An average of$5,000 for S.R.O. and zero bedroom, $6,500 for one bedroom,$7,500 for two bedrooms and$8,500 for three plus bedrooms will be loaned and the property owner is expected to "match" these public funds by securing private financing for the remaining 50% of rehabilitation costs. These Deferred Payment Loans require no payments to be made,no accrual of interest,and no fees to be paid until such time as the rental property building is sold or title transferred. The DPL then becomes due and payable and a one-time 5 percent fee is assessed. The minimum average financing available is$1,000 per unit. Below Market Rate Loans may also be obtained under the HOME Rental Rehabilitation Program for the cost of rehabilitation. An average of$5,000 for S.R.O. and zero bedroom,$6,500 for one bedroom,$7,500 for two bedrooms and $8,500 for three plus bedrooms will be loaned with HOME Rehabilitation funds. The minimum average financing available is$1,000 per unit and the interest rate and terms fire negotiable. The program operates on a City-Mde basis; however,priority will be given to projects located in the various neighb+)rhood enhancement areas. Affordability covenants will be required in all cases,as outlined in HOME Program regulations at 24 CFR 92,252. Attachment No. 8 Page 2 of 23 4\s"Sree:Qucens:Attach8 RLS 96-759 11/04/96 C. When the HOME Rental Rehabilitation Grant funds are fully committed,an alternative Rental Rehabilitation Loan Program will be made available to interested property owners. The program will utilize CDBG funds for differed payment loans and matching funds at 6% interest rate. Although section 8 certificates are not involved, the City will require that 901/10 of the units following rehabilitation will be rented to low and very low income households. This element is binding by way of the o%%mer certification agreement between the City and property owner. The CDBG Rental Rehabilitation Program will follow the same guidelines as outlined in the Rental Rehabilitation Loan Program. D. fig& Cooperation between public agencies and the private sector is vital to meeting the rental housing needs of lower and moderate income families in the City of Huntington Beach. One of the ways to meet these needs to provide low or no interest loans to encourage multi-family rental property owners to rehabilitate their properties and increase the supply of decent affordable housing for low and moderate income families while preserving existing housing stock and revitalizing old neighborhoods. II. GUIDELINES A. Deferred Payment Loans (DPL)and Below Market Rate Interest Loans (BMRI) are available to multi-family rental property owners of any income range on a City-wide basis; however,priority will be given to projects located in a neighborhood enhancement area. The property must meet the following criteria: I. Be in need of repairs which meet the Building and Property Rehabilitation Standards. Existing nonconforming uses and/or code violations must be remedied as a top priority of the Rental Rehabilitation Loan. 2. At least 90%of the units are occupied by very low income families. 3. Eligible improvements include,but are not necessarily Iimited to,the following: Attachment rdo. 8 Page 3 of.3 4's%Agme:Quecns:Attach8 RLS 96-758 1 IM4/96 Y a. Additions and alterations to increase the livability or usefulness of existing structures,such as rooms, porches, stairways,closets, bathrooms,and entrances. Garages may also be considered eligible particularly in situations where off-street parking codes are not being met. b. Exterior work to help preserve or protect structures,such as painting,roofing,siding,and property enhancements, such as landscaping, sidewalks,and fences. C. Interior work to make a structure more livable,such as painting, papering,plastering, new flooring,and the work. d. Repairs,restoration,or replacement of important parts of structures,such as heating systems,plumbing systems,septic tanks, electrical«firing and service,structural and foundation repairs,and built-in kitchen appliances in residential structures. C. Fumigation and treatment of terminate and pest control. f. Energy saving repairs and devices(solar heating, insulation, window caulking,etc.) g. Modifications which aid the mobility of the handicapped and elderly. h. All improvements mint be physically attached to the property and permanent in nature. 4. The follo«zng improvements are lid eligible: Barbequc Pits Bathhouses Burglar Alarms Burglar Protection Bars Dumbwaiters Fire Extinguishers Greenhouses(except commercial greenhouses) Hangars(airplane) Kennels Attachment No. S Page 4 of 23 4WAgr=Quccns:Attach8 RLS 96-758 11/04/96 Kitchen appliances not including stoves which are designed and manufactured to be free-standing and are not built-in and permanently affixed a3 an integral part of the kitchen in a residential structure Outdoor Fireplaces or Hearths Penthouses Photo Murals Radiator Covers or Enclosures Stands Steam Cleaning of Exterior Surfaces S«imming Pools Television Antennae Tennis Courts Valance of Cornice Boards Waterproofing of a structure by pumping or injecting any substance in the earth adjacent to or beneath the basement or foundation or floors 5. After rehabilitation,projects roust at least meet Section 8 Housing Quality Standards for Existing Housing(HQS). B. AppEcant Eligibility BMRI loans are available only to applicants of legal age and having the capacity to competently enter into financial and contractual agreements. The borrower must own the property to be rehabilitated. The following criteria shall apply to applicant eligibility: 1. Length of Ownership-The unit must have been owned by the applicant at least one year prior to the date of application for a loan. Owners may be exempted from this rule if,in the opinion of the Rehabilitation Manager and Program Manager,special benefits to the designated Neighborhood Enhancement Area will result from the loan activity. In the case of a CHDO,or other eligible nonprofit, site control is required,but the length of ownership may be less than one year. 2. All persons on title to the property must sign promissory note and deed of trust. 3. If applicant's property is on a land lease basis,the lease must be for a fixed terns which expires no less than six months after the maturity date of the loan. Attachment No. 8 Page 5 of 23 41s1Agree:Quccns:A1tach8 RlS 96-758 l 1/04/96 4. Credit history, income to debt ratio, and employment status are reviewed and verified by the bank contracted by the City. The bank advises the City and participants as to approval or rejection of applicant. 5. Owner must be able to demonstrate a 20%before-rehabilitation equity investment in the property based upon a City-ordered independent appraisal. 6. Owner must utilize an approved private lender,or demonstrate personal resources,to finance any remaining amount of the total approved rehabilitation costs. (Owner may participate in the City's regular CDBG Rental Rehabilitation Program to finance the remaining 500/6.) C. Ian Conditions 1. City Conditions: a. As incorporated into the Fair Lending Notice part of the application package,the City as lender must comply%%ith the Federal Equal Credit Opportunity Act and California Housing Financial Discrimination Act of 1977. b. The City must comply with the Fair Credit Reporting Act which stipulates and guarantees the applicant's privacy and right to have all information regarding the loan transaction kept in a confidential manner. C. As included in the Lead Paint Warning part of the loan application packet,the U.S. Department of Housing and Urban Development requires that the City advise applicant of the dangers of lead base paint. 2. Participant Conditions: a. The specific terms and conditions for Rental Rehabilitation Loans (DPL and BMRI)are incorporated in the mortgage or other security instruments,as applicable,and the Promissory Note as required by the pertinent documents. b. Civil Rights The participant shall not discriminate upon the basis of sex,age, race,creed,color,class,national origin,or ancestry in the sale, lease,rental,use,occupancy,and amarding of contract of the Attachment No. 8 Page 6 of 23 4\s\Agrce:Qucens:Attach8 RLS 96-758 11/04/96 property to be rehabilitated with the assistance of housing rehabilitation loans. Attachment No. 8 Page 7 of 23 4\s\Agree:Queens:Attach8 RLS 96-758 11/04/96 C. 11a"fproceeds The participant shall agree to use the loan proceeds only to pay for costs of services and materials necessary to carry out the rehabilitation work as detailed in the Work Write-Up for which the loan will be approved. d. Inspections The participant shall permit inspections by the City of Huntington Beach of the property to be rehabilitated with the assistance of the Rental Rehabilitation Loan for compliance with the Building and Property Rehabilitation Standards of the City. The participant shall also permit all other inspections deemed necessary by the Department of Community Development/Building& Planning Division regarding the property and the rehabilitation work. e. Completion of Work The participant shall a.5sure that the rehabilitation work shall be canned out promptly and efficiently through written contract awarded after review by the City's(lousing Rehabilitation Loan Program and prior written approval by the Rehabilitation/Manager. f. Ineligible Contractors The participant shall agree not to award any contract for rehabilitation work to be paid for in whole or in part with the proceeds of the housing rehabilitation loan to any contractor who, at the time,does not me-et standards of the Housing Rehabilitation Program as an eligible contractor. 9. Rids The participant shall keep such records as may be required with respect to the rehabilitation work performed with the assistance of a housing rehabilitation loan. Long-term monitoring requirements are mandatory as specified in 24 CFR 92.504. h. Jatercsj of Public Body The participant shall allow no member of the governing body of the City of Huntington Beach who exercises any functions or responsibilities in connection with the administration of the Housing Rehabilitation Program to have any interest,direct or indirect,in the proceeds of the Rental Rehabilitation Loan or in any contract entered into by the participant for the performance of work financed,in whole or in part,with the proceeds of the loan. Attachment No. 8 Page 8 of 23 41sW grce:Quccns:AUach& RLS 96-75911/04/96 , L Bonus. Commission_ frig The participant shall not pay any bonus,commission,or fee for the purpose of obtaining approval of the loan application. j. Securing Dids for Corstruction Work A participant may: 1. Negotiate a contract with an approved contractor of his/her choice,provided that the contract amount does not exceed the market rate for the services provided as determined by the Rehabilitation Manager. 2. Select an approved contractor of their choice for competitive bidding. k. Preservatipn oft a Security The participant shall maintain the property during the term of the housing rehabilitation loan. 1. Hazard Insurance The participant shall maintain fire and extended coverage on the property at least to the value of indebtedness and keep property taxes current during the term of the housing rehabilitation loan. M. Rent Calculations Affordable rents must be set and maintained as required by HOME Program regulations at 24 CFR Part 92.252. n. Owners must sign the owner certification form and abide by the agreement for the specified period of time. D. Loan,Amount Determination 1. The maximum amount of any Rental Rehabilitation loan is determined by application of the following criteria: a. An average loan grant per unit is$5,000 for S.R.O. and zero bedroom,$6,500 for one bedroom,$7,500 for two bedroom and $8,500 for three plus bedrooms, not to exceed any maximums set by IIUD. Loan will cover cost of repair and fees appurtenant to the property rehabilitation(work performed in compliance with a work write-up and Building and Planning fees). Maximum loan amounts funded with Multi-Family Rental Rehabilitation funds Attachment No. 8 Page 9 of 23 4�s"gmc:Quecns:Attach8 RLS 46-758 t t/04:96 may be increased only upon review by the IIOME Program Manager and/or the Rehabilitation Manager. b. An amount not to exceed the fair market value of the property at the time of application,minus the amount of the existing indebtedness on the property. 2. Terms a. Terms and repayment may be negotiable. In some cases, repayment of the loan%%ill be deferred until the property is sold or title transferred. At such time,the entire principal amount of the Ioan is due and payable plus a nominal one-time only 5 percent interest assessment. b. The entire amount of the Deferred Payment Loan will be placed as a recorded lien on the property. 3. Allowable Costs a. All costs relative to the loan processing(credit reports, lot book reports, monthly collection costs,and record keeping by lending institution)are paid by the Program;however,if a participant makes application for the loan and allows a period of time to pass which results in the n_-ed for processing the applications again, participant must pay all processing costs. Said costs may be paid for out of loan proceeds once the loan is funded. b. Specific costs covered by the Rental Rehabilitation loan include repairs necessary to correct violations or soon to be violations of the Building and Property Rehabilitation Standards and work consistent with objectives of the Neighborhood Enhancement Program as noted in the Work Write-Up. C. Specific costs=covered-by the Rental Rehabilitation loan include, but are not necessarily limited to,the following: I. Materials,fixtures,or equipment of a type or quality which exceeds that customarily used in properties of the same general type as the property to be rehabilitated. 2. Free standing appliances other than stoves,unless the need is justified by medical verification. Attachment No. 8 Page 10 of 23 4'slAgr=Quccns:A1tach8 R1S 96-75811/04196 3. Purchase,installation,or repair of home furnishings. 4. Reimbursement for owner's personal labor. 5. Reimbursement for improvements as noted in Guidelines, Section A4 (Ineligible Improvements). d. The total cost of all general property improvements(non-code violations,or potential violations), must not exceed 54%of the total loan amount. E. Funding for the City of Huntington Beach HOME Rental Housing Rehabilitation Program has been obtained from the U. S. Department of Housing and Urban Development( IUD). The program will be operated under HUD regulations and such other requirements as determined by the City of Huntington Beach. III. PROCEDURES: This section sets forth the steps which are to be followed in the processing of a Rental Rehabilitation loan. A. InL1ke Activities 1. Initial Screening a. Property owner contacts program. b. Rehabilitation Manager obtains income and property information from the property owner in order to make a preliminary determination of eligibility. Information collected includes the following: • Applicant's name,address,and telephone number • Location of property • Statement of ownership • Number of units and bedrooms per unit • Number of tenants in the applicant's rental building Attachment No. 8 Page 11 of 23 CslAgr=Qucens:A1tach8 RLS 96-758 11M4/96 • Number of low income tenants in the applicant's rental building • General household income range • Monthly rental rate per unit • Basic type of home improvements desired C. Applicants not meeting basic eligibility requirements do not become px-t of the program's case load. 2. Documentation of Eligibility and Determination of Type of Assistance a. Rehabilitation Manager mails General Information and Application Packet to Homeowner. Name and address of applicant noted on log sheet. 1. Information packet includes: • Program Information Sheet • Income limitslinterest rates • Map indicating target areas 2. Rental Rehabilitation Pre-Application 3. Application packet includes: • Cover letter listing the supplemental items required to be submitted with the application packet • 1 Lome Improvement Loan Application • Property O%mer Agreement • Schedule of Property Owned • Fair Lending Notice Attachment No. 8 Page 12 of 23 41s%Agrcc:Quccns:Auach8 RLS 96-758 1 1N04)96 • Lead Paint Poisoning information + Ethnic Classification 4. Supplemental items include: + A copy of the deed to the property • A copy of the previous year's Federal Income Tax for 1040 • Employment verification(last two check stubs)(if relevant) + Completed Social Security verification(or copy of last check) (if relevant) b. Completed application received(date indicated in activity log). C. Rehabilitation Manager or HOME Coordinator establishes file,assigns a number to the application,and determines feasibility of processing applicant. 1. If not feasible,Rehabilitation Manager or HOME Coordinator so notes disposition on Log Sheet and notifies interested person of finding in writing. Application is filed under Ineligible Projects. 2. If feasibly:,Rehabilitation Manager or HOME Coordinator so notes disposition on Log Sheet and notifies participant in writing. d. Rehabilitation Manager or HOME Coordinator should keep written records of every telephone call and every conversation with anyone connected with the rehabilitation project,including the date,person spoken with,the subject discussed and any result-this information should be recorded on the Activity Sheet located in each file. Attachment No.8 Page 13 of 23 4\AA.-rcc:Quccns:At1ach8 RLS 96-758 t 1/04/96 C. Rehabilitation Manager should keep copies ofaU forms in each file. The date received and any notes pertinent to the form should be recorded on the file Checklist. Attachment No. 8 Page 14 of 23 41s1Agrce:Queens:AuachS RIS 96-758 I LI 96 B. Initial Inspection Rehabilitation Manager 1. Sets up appointment for site inspection and work write-up. Property O%vner must accompany Rehabilitation Manager during inspection. 2. Documents existing code violations, incipient code violations, otherwise eligible items and requested home improvements on a work write-up. 3. Explains what improvements are eligible and/or ineligible and prioritizes work to be accomplished. 4. Makes a general assessment(preliminary estimate)of whether or not the differences can be corrected within the program's maximum dollar limitations. 5. Details findings and cost estimates in a Work Writc-Up which includes: • Scope of work- Quantity + Quality • Location 6. Schedules a meeting with applicant to review and approve Work Write-Up,make necessary changes(within limits of Code Enforcement),and explain contractor selection procedures. a. Property Owner must approve and sign the Work Write-Up. b. Property Owner received: 1, Four copies of the Work Write-Up -one copy with cost estimates(for Property Owner Information only)and three without cost estimates(to hand out to contractors interested in bidding the job). Attachment No. 8 Page 15 of 23 41s\Agree:Quccns:Attach8 RLS 96-7581 M/96 C. A copy of each completed form,with the appropriate information and signatures must be returned to the HOME Coordinator or the Rehabilitation Manager for placement in the case file. The owner and the contractor should also keep copies of all forms. C. CQntractor Selection Responsibility for the selection of a contractor rests with the homeowner. No agreements,written or otherwise,will be binding for rehabilitation loan funding unless they are first approved by the HOME Coordinator or the Rehabilitation Manager. The owner must select a qualified licensed contractor and the bid must come within 10 percent of the in-house cost estimate. In certain instances where the work items do not require permits, and the work is not highly technical,a handyman may be selected by the property owner. Property Owzier: 1. Must obtain Building and Planning Division approval if rehabilitation work involves a room addition or a significant altering of the present use of the property. a. Preliminary Site Plan or Drawing of any proposed changes to property must be submitted to both divisions. b. Preliminary plans should show existing use of the property (a sample plot plan may be included in Application Packet) as well as proposed improvements to determine whether or not Code requirements are being satisfied-it is not necessary to employ architectural or engineering services at this stage. C. Initial inspection by a representative of the Building and/or Planning Divisions to verify the proposed improvements may be necessary to receive building permit approval. d. Upon approval of the proposed improvements by the Building and Planning Divisions,applicant proceeds to obtain estimates for the proposed work. e. All necessary building permits must be obtained prior to disbursement of any loan funds. Attachment trio. 8 Page 16 of 23 M s1Agr=Quccns:Attach8 RIS 96-758 I1104/96 2. Provides Work Write-Ups(without cost estimates)to contractors interested in bidding the job. 3. Obtains at least two bids and transmits selected bid proposal to Rehabilitation Manager for review. a. Rehabilitation Manager or HOME Coordinator reviews bid proposal to determine cost reasonableness and compliance with program requirements and to verify contractor eligibility. b. Rehabilitation Manager or HOME Coordinator approves bid proposal. 4. Signs and awards contract after loan documents are executed and after satisfactory review of contract by Rehabilitation Manager. D. &ancial Review l. Rehabilitation Manager or HOME Coordinator reviews application,and determines credit worthiness,verifies income,and orders a Lot Book Report to verify title to the property. 2. Rehabilitation Manager or HOME Coordinator approves/disapproves package and notifies loan applicant of decision. 3. Upon decision of loan approval,in-house loan documents are prepared which include: Promissory Note • Deed of Trust(signatures to be notarized) • Notice of Right to Cancel • Escrow Control Instructions E. you Closing 1. Rehabilitation Manager or HOME Coordinator schedules and holds the loan closing in the 1iCD office. Attachment No. 8 Page 17 of 23 41sW gmc:Qu"fts_Aciach8 R1S 96-75811/04/96 2. Owner attends loan closing. 3. Rehabilitation Manager or HOME Coordinator reviews loan documents and owner responsibilities. 4. Property Owner signs loan documents-the signature on the Deed of Trust must be notarized. 5. Property Owner signs loan documents-the signature on the Deed of Trust must be notarized. 4. Property Owner signs loan documents-the signature on the Deed of Trust must be notarized. 5. Property Owner has the legal right to cancel the loan'Ai thin three days. 6. Rehabilitation Manager or HOME Coordinator forwards loan documents to City Attorney's office for approval as to form. The loan documents are then recorded and filed at the City Clerk's office. Loan collection is authorized by the Rehabilitation Manager. F. _CMitract Management and Di bursemen f Funds Contract Management begins with negotiation of the contract between the contractor and owner and continues through the actual construction work, job inspections,payment to the owner, final close-out of the job,and often a one-year warranty period. 1. Pre-Construction Conference Rehabilitation Manager or HOME Coordinator conducts a pre- construction conference with the owner and the contractor to discuss the contract and the responsibilities of each party. a. A job walk-through with the property owner and the contractor to review the work write-up and contract document. Every item on the contract should be read and discussed to ensure that all parties understand exactly what the contract entails and to minimize the possibility of later misunderstandings. Attachment No. 8 Page 18 of 23 4's\Agrce:Qucens:Attach8 RlS 96-758 11/04196 b. A review of the work,inspection and payment schedule so that all parties will be aware of the timeline and order of job progression. C. An explanation of Change Order procedures. The Rehabilitation Manager or HOME Coordinator must snake it clear that any changes required by job conditions or requested by the homeowner must be put in writing, including price,and agreed to by the homeowner and contractor before the additional work is done(Change Order). d. A review of arbitration procedures in the case of a dispute between any of the parties. e. Property Owner and Contractor sign contract document. 2. Arbitration Procedures a. In the event of any dispute between the o%%rner and the contractor concerning the contracted scope of work,the Rehabilitation Manager or HOME Coordinator will work with both parties to negotiate a satisfactory solution. Should resolution of the situation not be possible on an informal basis,the parties may elect to have a hearing by a professional arbitrator or contact the State of California Contractors License Board. b. Complaints concerning the rehabilitation loan program shall be in writing and addressed to the Rehabilitation Manager. The Rehabilitation Manager will contact the complainant an3 attempt to resolve the problem. A written response will be made within 15 working days. If complainant is not satisfied after said written response,a complaint may be filed with the Program Manager or HOME Coordinator who will schedule a meeting with the Rehabilitation Manager. A written response will be made within 5 working days. 3. Accounting Procedures a. Upon expiration of the required three-day right of borrower to cancel the loan transaction,Rehabilitation Manager Attachment No. 8 Page ]9 of 23 4ls\Aoree:Qucens:Anach8 RLS 96-758 11/04/96 prepares an in-house Material Requisition and obtains Project Manager's approval. The Material Requisition is in the same amount as the principal amount of the loan and establishes a Purchase Order with the Accounting and Records Division of the Administrative Services Department. b. The Material Requisition will be submitted to the Accounting and Records Division upon Departmental approval of the first request for payment. A Request for Partial Payment will be submitted at the same time to ensure immediate payment to the home owner as the establishment of the Purchase Order takes approximately two weeks. C. The Purchase Order is in the name of the participant(s) and serves as the rehabilitation Escrow account from which payment for the Rehabilitation work is disbursed. The Request for Partial Payment and all future requests for payment will be debited against the Purchase Order. 4. Check Disbursement a. Flomeowmer contacts Loan Program to arrange a job site inspection and progress payment. I. Rehabilitation Manager visits the job site and verifies that the work included for payment is complete and within the scope of eligible work as outlined in the Work Writc-Up, and that all necessary inspections by the Building Division have been satisfactorily accomplished. 2. Rehabilitation Manager approves payment to the homeowner and signs off Payment Request. b. Rehabilitation Manager transmits Payment Request to Program Manager for approval. Completed form includes the amount of disbursement, name and loan number of participant,a description of the work completed and signatures of Rehabilitation Manager or BIOME Coordinator,and Program Manager. Attachment No. 8 Page 20 of 23 4\s\Agrcc:Quccns:Attath8 RLS 96-758 11104,96 C. Program Manager transmits Payment Request(excluding attachments)to the Accounting Department who will prepare a check payable to the homeowner for the approved amount. A copy of this request will be placed in the participant's file. d. Alte am tive Program Manager transmits Payment Request to City Treasurer for review and approval. Upon review and approval of the payment request,the City Treasurer will for%vard a request to Security Pacific National Bank to prepare a Cashiers Check payable to the homeowmer for the approved amount. A copy of this request will be placed in the participant's file. e. Check Disburs:ment to Homeovmer 1. The Rehabilitation Manager contacts the homeowner to pick up check at the HCD off ice. 2. Upon actual disbursement of check to participant, the ho:neovvmcr signs the Receipt of Loan Amount, acknowledging receipt of the check. Said form includes loan number,participant name, warrant number,and remaining loan balance. 3. Copies of the above mentioned documents(Check and Receipt of Loan Amount)will be placed in the participant's file. 4. The Payment Schedule and the Purchase Order copy in the participant's file is debited upon disbursement of check for amount expended. f. Timeline-Generally,the check is available within five(5) working days following payment request submission to Program Manager. g. All above mentioned documents and bills are filed in participant's file. Attachment No. 8 Page 21 of 23 4Xs%A&me:Quecns:Attach8 RIS 96-758 11/04/96 h. Funds cannot be disbursed for work which does not meet the approval or standards of the Building and Planning Divisions or Neighborhood Enhancement Program. 5. Final Inspection a. The Rehabilitation Manager or HOME Coordinator, homeo,.Nmcr,and contractor should make a final inspection of the project together. When the improvements are completed,the job is considered finished,except for a one- year guarantee on labor and materials which is a normal part of the contract. There may also be an inspection at the end of the One-year warranty period. b. The Rehabilitation Manager or HOME Coordinator completes a Certification of Final Inspection and transmits one copy to homeowner. 6. Close-out of the Contract a. Waiver of Liens This is a document releasing lien rights on the job,to be signed by all material suppliers and subcontractors. b. Warranties The general contractor must give a fine-year guarantee on all labor and materials,and supply to the homeowner all manufacturers' warranties for equipment such as furnaces, air conditioning units,kitchen appliances and hot water heaters. Any product guarantee beyond one year,such as a 15-year guarantee on roof materials, should also be passed On. G. LQPn Collection 1. a. At the time of sale or transfer of ownership the loan is due and payable plus the one-time 6 percent interest charge. b. Upon completion of demand,escrow instructions for full payment of a loan and reeonveyance of the Trust Deed, a Attachment No. 8 Page 22 of 23 41s%Agree:Queens:AUach8 RLS 96.758 1 M196 Request for Full Recomeyance is signed by the City Clerk and Rehabilitation Manager and fonNwded to escrow company. C. Payment is then made by escrow company or owner for full amount of loan payable to City Treasurer. d. The funds collected are then deposited into City Savings Account No. 724-137-309 on deposit at Security Pacific National Bank-Huntington Beach, California,Beach and Garfield Branch. 2. City Collection -BNIRI_Loans a. The city is responsible for BMRI loans issued to those within a pilot program. b. An "In House" collection procedure exists with the Rehabilitation Manager forwarding executed loan documents to the City Clerk for filing. C. A copy of Promissory Note is forwarded with a Request for Establishment of Collection Account to Administrative Services-Accounting and Records-City of Huntington Beach. Attachment No. 8 Page 23 of 23 4W Agr=:Quccns:Attach8 RLS 96-75811104/96 • A r r A e H n' CM-r •3 ZONING DM 31Z ONAL DISTRICT MAP ti0TE CITY OF �.� . e-0is �&.� � u fnws+w un•+n rws sanu G" C"COL QRp Ci M0. 7S9 0.wc..on rr m rA �e p.e LEGEND= rtirm r►_sc � �".mac T� �ts�ot�+��rrcwnwk t�fr�t* �.`� � � �� � r.>.-■ ri.. �lwRrt r.r.O.�A.�rk.L+rMwr4+ Kr""7 W..R we� tK eer■etTINGTDN BEACH n ■,Olatr+rc MR■IKLLar R gr'r"'° ►fi:.. n:' l r ,ef rmar+.ar�e■arr ao,rft 9, s E COUNTY, CALIFORNIA ft"Jft t 0-M..,o.AQ Oc,.tt rn •.. ga n anoroa epsow• cY c cow"wo r FAcu cwt194nR f•�i-r br ,.r ti= /IOECer.M Oirw,T •r� r+ roe IH i i, ��"r Ou • LMOR 3 Mom. ■•. AA 4L11r1■,S vim arvemx 'I ',/waRHER i.:« wW...e AVE a■ n FL r _ R2 OP 11A1 ~ MI - M fw °■ �;_-- C4-Mill i um OWE R2 R2 I'w CF-E mi o: R2 R2 ' Imp R 2 R3-FP2 CF-R r ;m1 R 27 R 2 R2 1� JLirLl* - 4 Rt O R i „ Mto I I; M I �p R3 R3 / I 1; �} r I a C 4: to RI RI�. RS r Rt R! d-R:S-" 3 3 _.:r raz�,� I r, k3 1 . IrrU soR� a z d O " ,n M � in Subject R1- CD RI-CD 3 0: IX a ac ac Cc it r� r t I r RI FI-CD .� i-CD •RI-CD 'g 3 8 R3 _ � i "t M . D o I MI MH tc4 I ml 0 1Ra1 0 a •. I Ldr m R2 •°, Q :ml — r L M I R3 CF-R R2 C4 : R3 T McY V.v —Mum-.. T•I u • MI-CD EMI R2 - I ! r • A �/ � ', } U �g 6 h1� r R2 0-%. u. •� L.\V •lU :-I VU • V•uun!. Vt<1!t_•LU%1 NAL- Jroauot.i v Sheetl QW13IGNS LANE AIDAII'0'HEIVTS Job$ '0 lot23El6 17422132 Queero Lane.Huron Beach AaOunt 6"S Updated Life Per IW7 19G6 lw9 2000 2001 2002 Nmbet Descrtoon Cost Smn type Wnth Annual 1 Ucxl Fbor CovermV 7 yoomm rmrvee 96 1 132 1,186 1.246 1,298 1,348 1.402 210W Mactwo loot tesscvee 95 1,152 1.1se 1.246 12e6 1,345 1.402 3 000 8creern 3yearyreserves 24 268 300 312 324 337 350 4 OW Ponwy 2 rn resarm 126 1 536 1,lE97 1.661 1.728 1.797 1.6m 5 000 Ls d r e reserves 00 m 749 779 810 842 876 6 r)p(t 5 yeag I reserves 301 374 389 4% 421 43E3 ?,ow ecmcwe reserves 61 75 To el 64 68 7.100 Roofkv 25 rsua f"erm RESEK11EwS OPERATING COSTS 5 X Assess+mts ac ml a cos 48 576 599 823 G48 674 701 S c.•l00 I Muancs menth eft 120 1 4401 1.4% 1,558 1.620 1,68S i M 59.1 Water at.blbd opftV" 125 1S30 I 1,560 1.622 1.07 1.7% 1.025 53-2 Gas ay biled oprtV eoe 40 430 499 S19 540 S62 554 53.3 E as bllad cos 40 430 409 519 540 562 584 S" Tra6WSewer I mx*hly oprwV con 200 2 4)o Z.496 Zme 2;7p0 2.8W 2.920 1000 LwuWp Matr* mxvw oprbv Cos i50 16m ISM 1.947 2.MS 2.108 2.190 20M Plunbl ar b1EedcFftrq cos 150 1 870 1,872 1.947 Z025 2.106 2.190 3000 EMctrkW i a!billed oprtry ooe 20 2.60 250 260 270 281 292 4000 m sc Repair an biled cos 240 2 83D 2,965 3,115 3.240 3,309 3.504 45M On Site Mumnt I e.bled Opftna Cos 90 1 030 1.123 1,i68 1,21S 1 f63 1,314 5300 CPjPd Ckin m blkd oprtno cml. 36 IC A42 467 455 505 S26 off le OCCFiC cos 4W 4 6:)0 4.992 5.102 5.399 5.e13 5,640 63W Markotlng as wKed oprtng 003 col 720 749 T79 El0 642 876 bperx-ee Z,159 25,WX 26,944 28.022 29.143 30,309 31.521 rsrvs per rnorgh 440 Gress kto " 3,4W 41.952 rsrve per tnt S3 Net Operating Inc 1.M7 18,0•u 1.15 debt see 1"? 19 V" 2000 2001 1992 2310 W TD.conbortfu 132.OW 1,158 13.9m 13.901 13.901 13.901 13.E+01 13.901 2700 2nd TO.HOME 490.000 2210 3rd TD AHPlFHL 3240W 654-,000 179 2.143 Loa- 132.tI00 E4mu" 3,917 39,809 40,845 41,923 43.0M 442M 45,422 IrA Rate 10% Nct Rent 3.496 41.952 43,630 45,375 47,190 49 Q78 61.041 Amon am Laundry 40 480 An 519 540 5E2 $84 Prt1t Am 1,156 Cosh flow 219 1 2f 7 1,998_ IRW 2,000 2,001 2,002 tme treks rent %ARI HUD ku me Da51 2t, 35% 8 460 3 6t30 tam of 4 21.4;6 tam or 4 27.555 tam of 6 24.5W tam d 6 315M 8 24 W f-et tot�IferM 3580 iti4 9�f6 v irpw w ud des total HOME rent 12bdm 1 W 7 1)'.6 HOME rent 13 bdr»1 I 1 788 44 7.b Page 1 .� �. �. .. .....� � � /V �{ VV V VV.�V V�Lt•tii\//\A/. V/VVVV ..r Vr Sheetl 10f24196 DUEEEAIS LANE APARTMENTS 8 ea 2br units 6 750sf 17422r32 Queens Lane,Huntln on Reach Original New Est ficrence lPaid balance portrait BUILDING COST 90700 106400 -19700 13300 SITE DEVELOP t200 14200 20M 1275 PROJECTADMI 30200 9000 21200 1125 ACQUISITION C 500000 500000 62500 FINANCE COST 19340 8t00 __ 9244 1137.5 PREDEVELOPM 38560 1930OF 19280 2412.5 PROJECT COST I 686000 654000 23000 81750 PROJECT COST 6860001 654000 32000 81750 PRIMARY FINAN -103000 -132000 ND00 _ -16500 AHPIFHLB -43000 -32000 -11000 -4000 HOME Loan -540000 -400080 !0000 -01250 IA proved New Est IDIffererlco notes 1001 Found/Slab 0: 0 1070,Framing _ 0 0 1075'Fnish Corp _ 20000 1600o 0 2000 1100 Insulation 01 0 1130 Plumbing _ 16000 -1e00o 200.0 114D Heating 0 0 1170 Roofing 6400 9180 -2780 _ 1147.5 T _ 0 0 1180'Stucco _ 2000 2000 0 1. 250 1 i 90 Raingutters _ 5001 500 _ 0 62.5 1200 Drywall 60001 6000 a 750 .12001D 1236 Elecxticii _3000 3000 0 _ 375 1231 Eioc Fixtures 1400 1400 0 _ 175 _ 0 0 1232 TV/Phone/Cable 1600 1600 0 200 1250 Alum Win/Dts 32 00 3200 0 400 1270 Gera a Doors 800 -too 100 13001coninets 16000 16000 0 2000 137%Formica taps aee 1300 0 0 0 1390 paint 8500 8500 0 10e2.5 1400 ASS Abate 1600 18D0 01 200 1410 Air Conditioners _ 0 0 _ 1430 OvenfHoodfbisps 2T00 2700 0 337.5 1450 FloorCovemg 13000 13000 0 1625 ' 0 0 1480 Coasts Clean Up 1600 01 200 1500.Mailboxes 160 _ 160 0 _ 20 1510,.Med Ceb1Mlrror see 1520 see 1520 1 0 Pagel - St�c3et1 1520 Arch Hardware 1 1DO0 low 0 125 1530 Shower Rod/Crtn _ 40 160 -120 20 1570 Levelors/E uiv 2000 2000 0 250 total 90700 106400 -19700 13300 2050 OemolSite Prep 2000 4000 -2000 500 2100 Fletwork see 2110 _ 0 2110 Orlves/Curbs 0 0 0 _ 0 241 D Blkwrk/Fence 0 _ 0 2420 ImmvrklFence 0 0 0 0 2450 Landscaping 6200 0200 0 775 2460 Playground 0 0 total $200 10200 2000 1275 3100 Constr Su ervsa .160001 6000 10000 750 3200 Super/On Site 9200 1500 7700 187.5 3300 Reirnburseables 50001 1500 3500 167.5 total 302001 9000 21200 1125 4100 Perm Loan Fee 4240 2200 2040 275 4110 Constr Ln Fee 32D0 0 32DO 0 412101Ins eetion Fee 2000 0 2000 0 42Loan Escrow 1200 2200 .1000 275 �43 isal 1200 _ 1100 0 ISO 4400 Corutr tnterest 4000 01 4000 0 4500Insurance _ _ 1000 1000 0 125 46DO Pmpertj Texas 1500I 2500 -1000 312.5 18340 91001 9240 1 1137.5 F9000 C allAdmin 10000 30Q0 7000 375 9010 ArchRect _ 1600 2500 -900 312.5 Saw OMB 133/AuoR 1600 1600 01 200 8041 ASMead R 4200 4200 0 525 WS'Landscp Arch 0 0 9050 Blue nts 0 0 9065 PermltFees 5000 i000 4000 125 9066 Relocation En_ 2000 2000 0 250 80T0 Cantin ncy 14160 5000 oleo' 625 D 0 total 385601 19300 192601 2412.5 Page 2 Acquisition of 17422 & 17432 Queens Lane The Redevelopment agency of the City of Huntington Beach and Orange County Community Housing Corporation (OCCHC) Deal Points: 1. The City of Huntington Beach will provide $490,000 in HOME Investment Partnership funds as a loan to Orange County Community Housing Corporation (OCCHC). These funds will be used to acquire two 4-unit rental properties located at 17422 and 17432 Queens Lane. 2. All ten of the units will remain affordable for thirty years for households earning less than 50% of Orange County median income adjusted for family size. An affordable housing agreement, with a deed of trust, promissory note and regulatory agreement, will be recorded against the properties as security for the loan. 3. Beginning in the fifth year of the agreement, and continuing annually through the thirtieth year, OCCHC will forward the proceeds of a residual receipts account to the City as a means of repayment of the HOME assistance. The minimum amount of the annual repayment will be $1,200.00. OCCHC agrees to make-up any shortfall that may exist in the account so that the minimum repayment is available. Should the economics of the project not allow for the minimum repayment of $1,200.00, then OCCHC will have the right to appeal to the City Council and request that the minimum repayment be reduced, suspended orforgiven. OCCHC agrees to bear the entire burden of proving its inability to meet the minimum payment. The City Council will reserve the right to reduce, suspend, forgive or renegotiate the terms of repayment based on the evidence submitted by OCCHC. Both parties recognize that the annual repayment amount may not completely repay the principal balance after year thirty. Any balance will be repaid at that Queens Lane Deal Points,continued time, or re-negotiated by the parties. The City reserves the right to audit the financial statements of OCCHC to determine or verify the balance of the residual receipts account. Any principal amount of the loan remaining will be adjusted annually for inflation based on the Consumer Price Index (CPI), or another comparable index, as mutually agreed upon by both parties. Relocation 1. A relocation plan must be submitted to the City for approval p1Lt[to the relocation of any tenants from the property. Name, gender, age, household income, and amount of relocation payment must be furnished in the relocation plan. Further, copies of all notices furnished to the tenants as part of the relocation must be given to the City. 2. OCCHC must agree to indemnify the City against any relocation obligations and expenses that arise from the acquisition or rehabilitation of the subject properties; and also from any relocation and expenses that arise aftff the acquisition and rehabilitation activities are complete. Rehabilitation 1. OCCHC will rehabilitate the subject properties to conform with (at a minimum) federal housing quality standards. OCCHC agrees to maintain the properties for the duration of the affordable housing agreement and will allow the City to inspect both the interiors and exteriors of the subject properties on an annual basis. 2. OCCHC will furnish a list of proposed repairs and improvements to the City for informational purposes pIL [to rehabilitation. Even though OCCHC is funding the G:BrownlQueensldeatpntLdoc 2- Queens Lane Deal Point 3, continued rehabilitation, the City will have the right to approve the list prior to the start of any rehabilitation work. 3. OCCHC will invite the City to participate in progress inspections once rehabilitation work has started. The City reserves the right to independently inspect the units and OCCHC agrees to provide access to the City with forty-eight (48) hours notice. 4. OCCHC will furnish copies of all building permits for all items required to be permitted by the Huntington Beach Municipal Code, with proof of inspection by the Huntington Beach Building Department, where applicable. 5. OCCHC will test for the presence of asbestos and lead-based paint as required by HUD regulations. OCCHC will remediate any asbestos or lead-based paint hazards where the level of those substances is found to be in excess of acceptable thresholds. Environmental Is5uee.. 1. The City has conducted an environmental review of the sites in accordance with HUD regulations at 24 CFR Part 58. Using those regulations as a guide, the City has determined that the project is considered "categorically exempt"from NEPA (National Environmental Policy Act of 1969) and is not subject to further, more complicated assessment. 2. This review, while thorough, cannot be considered as exhaustive or all-inclusive as a Phase I due diligence exercise. Because of this, OCCHC agrees to indemnify and hold the City harmless from all liabilities (including penalties, fines, and monetary sanctions) arising from hazardous materials storage on the sites, or hazardous materials contamination of the sites. G:BrownlQueensldealpntl.doc 3- Queens Lane Deal Point;, continued 3. OCCHC agrees to provide any notices, orders, or reports concerning environmental matters that may affect the subject properties to the City Ito the funding of the acquisition loan. Per pedy Management Issues 1. OCCHC will maintain the sites during the affordability period in accordance with a restrictive covenant. Should OCCHC fail to adequately maintain such areas, and any problems identified by the City are not corrected within sixty (60) days from the date of written notice from the City, the City may perform the necessary maintenance and OCCHC will pay all reascnable costs for that maintenance. Further, if any conditions are identified as health and safety violations that pose a danger to life and limb, the violations must be corrected within three (3) days. Default Provisions 1. OCCHC agrees to the default provisions contained within the draft HOME agreement. To summarize, the default provisions involve the immediate repayment of the HOME assistance, with interest should any default by OCCHC occur during the affordability period (30 years). G:Brown\Queens\dealpnil.doc 4- PROOF OF PUBLICATION STATE OF CALIFORNIA) ) Ss. County of Orange ) am a Citizen of the United States and a resident of the County aforesaid; I am over the age of eighteen years, and not a p�sucos�cF fti �iter -In»= party to or interested in the below PUBLIC NOTICE - nod Intact. by t►'he - entitled matter. I am a rinci al clerk of MY or Grief dixeC1tl1e or"car or P P tiUNTINaTOft BFJ►GIl anK *War or applicant the HUNTINGTON BEACH INDEPENDENT, a KOTtceoF apwah"a?sp HUD..or INTO"TO �1 that appltcant'a eme . NEQUl3T A ronmar+bl revrewr m the . newspaper of general circulation [printed RaF for thaproledornW i" RIL,BASB OF FUNDS • regWrod dedsk^ ltri - and published in the City of Huntington row kv, or aep �'�e to llf-1'ER -11:11M the P+dlect h n» Emil Beach County of Orange.. State of >ro>RemsrOROU" AND PfEMONSt c) other sppedhc grounds Nettee of blem In HUD rWAe XM a 24 California, and that attached Notice is a :o a CrR Part 58.75. - true and complete con as was tinted �°1� parred�a ub med np Bo- P PY P pGiws�r*gcui But n proCedur rt(2 me nrq Pan and published in the Huntington Beach atrbntnaragUWforre- adndmalbeaddesPseed tease of grant twds and on to: and Fountain Valley issues of said I.-I or,n»nur O.rt1116.tion ErrvlronmermDrIcer, �WW"g to tfterelo the NUD, Los Angeles Area newspaper to wit the issue(s) Of: g of »- or.a, te15 west oiy PIC n+ent� Bh•d.. Los Angeles, CA 9W15.3sa1 &PubelcleWL The re"W No objection received fate 10 the following wit lW g nsidered by HUD. � 1• N) father erMronmental Pro t Thle Oakrlaw MWW of such prolect Is October 31, 1996 L0C71,�WWr►17�z prcposedtobe uclad, _�432 »Lf 2 and prtor t0 the seteasa at oral hinds. hinds. Purooee of Pru(ar.�AotpA• A11 imeres.ad agendas, siftn tra + terrta►tt nsullill- groups and persons dts. ag•sMnp wMh dells an en kwNed to su subtNt wrftit• tan cowuneres for CoRs<tler- __ I declare, _under penalty. of perjury, that_. ,CS "MM - -anenbythoCltyto: . - Beacthe foregoing is true and correct, r Economic Development rtfifi F10t4E *tty� Deeet, 51t, 2oor Hun Yd a 09 ad Houle- �Streat, Sm Floor, Huh- tin�lDrt BMCh. CA f126te, ntfartt �ban 8 5 Atlontlon: Gregory A.. }�y w Brown.(714)W&5542 of 1A The Ctltr a? such r"en canmards Executed on October 31 , 1996 f ech 16�r ehculd receNed at Ins � vw m.�►or address tistted above on 6. at Costa Mesa, California. Bef+ett arts ltr, t>"e e•tS 01996. M �oTd Uberteep In hisAll comild��be considered am" aD�1t"�• arrC VW C,Ay wiu not re• kp O0CW tidtaette 10 uY et release of Fed- t ept the obdicam d to ass' h,nde or tell*any ed- f*Carat o0fb N on err W rrrVntstra tra sCt10r1 an the is hRRK" to udw" tar. K t p„Or t0 the In I an re'MUwe, die- CqWqaler" pis Cats I. tt+t 10fig" ithI. Wd �o T. �y Uberwagar 6srt W"S ,,��` tpel~of Oflloer SIflatll tlon Is thad caanfe arookwaf. g erpproral, the qry C iq%Cnlr of Hum r+gmn Beach Staab �ar Pb shed HuOW 1111n 8eeci�Fdntain 1fMey Irr rrMn411 Potty depender+l Oc1oD+r �1, amid other to- Is" 3�g tot Tatra and T and MOOodke HUD to �ppow osiM WPon or of hnb ow eel Eof go!r an was, A STEWART TITLE OF CALIFORNIA ESCROW MASION 2010 MAIN STREET.SUrTE 260. MINE, CA 92714 (7714) 470-WIO FAX (714) 476-a961 FAX: (714) 7W-W70 November 26, 1996 • I�087V MOP"" TCity of �b 0 Huntington Beach fi�GNo�q�TM l9gs 200 Main t Attn: HuntinGren Brown{ CA 9264$ O�Fi�F0 g RE: Escrow Number: 01029625 COMMUNITY HOUSING CORP. Property Address: 17432 Queens Lane Huntington Beach, CA Loan No. : NDI Bear Greg: In connection with your above referenced loan, we are pleased to enclose the following: (X) Certified copy of Escrow Instructions dated October 4, 1996 (X) Preliminary Report dated as of September 27, 1996 Should you have any questions, please contact the undersigned, Sincerely, STEW-ART TITLE COMPANY OFF RNIA Lennette Williams/cg Escrow Officer enclosures STEWART TITLE PRELIMINARY REPORT ATTN: PATTY H. YOUR NO. 01029625 STEWART TITLE ESCROW 2010 MAIN STREET #260 IRVINE, CALIFORNIA OUR NO. 20128056 DATED AS OF SEPTEMBER 26, 1996 AT 7:30 A.M. IN RESPONSE TO THE ABOVE REFERENCED APPLICATION FOR A POLICY OF TITLE INSURANCE, STEWART TITLE HEREBY REPORTS THAT IT IS PREPARED TO ISSUE, OR CAUSE TO BE ISSUED, AS OF THE DATE HEREOF, A STEWART TITLE GUARANTY COMPANY POLICY OR POLICIES OF TITLE INSURANCE DESCRIBING THE LAND AND THE ESTATE OR INTEREST THEREIN HEREINAFTER SET FORTH, INSURING AGAINST LOSS WHICH MAY BE SUSTAINED BY REASON OF ANY DEFECT, LIEN OR ENCUMBRANCE NOT SHOWN OR REFERENCED TO AS AN EXCEPTION ON SCHEDULE B OR NOT EXCLUDED FROM COVERAGE PURSUANT TO THE PRINTED SCHEDULES, CONDITIONS, AND STIPULATIONS OF SAID POLICY FORMS. THE PRINTED EXCEPTIONS AND EXCLUSIONS FROM THE COVERAGE OF SAID POLICY OR POLICIES ARE SET FORTH IN THE ATTACHED LIST. COPIES OF THE POLICY FORMS SHOULD BE READ. THEY ARE AVAILABLE FROM THE OFFICE WHICH ISSUED THIS REPORT. PLEASE READ THE EXCEPTIONS SHOWN OR REFERRED TO BELOW AND THE EXCEPTIONS AND EXCLUSIONS SET FORTH IN EXHIBIT A OF THIS REPORT CAREFULLY. THE EXCEPTIONS AND EXCLUSIONS ARE MEANT TO PROVIDE YOU WITH NOTICE OF 14ATTERS WHICH ARE NOT COVERED UNDER THE TERMS OF THE TITLE INSURANCE POLICY AND SHOULD BE CAREFULLY CONSIDERED. IT IS IMPORTANT TO NOTE THAT THIS PRELIMINARY REPORT IS NOT A WRITTEN REPRESENTATION AS TO THE CONDITION OF TITLE AND MAY NOT LIST ALL LIENS, DEFECTS AND ENCUMBRANCES AFFECTING TITLE TO THE LAND. THIS REPORT, (AND ANY SUPPLEMENTS OR AMENDMENTS THERETO) IS ISSUED SOLELY FOR THE PURPOSE OF FACILITATING THE ISSUANCE OF A POLICY OF TITLE INSURANCE AND NO LIABILITY IS ASSUMED HEREBY. IF IT IS DESIRED THAT LIABILITY BE ASSUMED PRIOR TO THE ISSUANCE OF A POLICY OF TITLE INSURANCE A BINDER OR COMMITMENT SHOULD BE REQUESTED. MARTY O'LEARY TITLE OFFICER 2010 MAIN STREET, 1250, IRVINE, CA 92714 (714) 476-0777 FAX NO. (714) 756-6077 MEMBER CALIFORNIA LAND TITLE ASSOCIATION F+Crtin86t FEr Ga ii ��VO iiR(� exa �� f the Original. By STEWART TITLE ESCROW 20128056 THE FORM OF THE POLICY OF TITLE INSURANCE CONTEMPLATED BY THIS REPORT IS: 1. CALIFORNIA LAND TITLE ASSOCIATION STANDARD COVERAGE POLICY M 2. AMERICAN LAND TITLE ASSOCIATION OWNERS POLICY FORM B 3. AMERICAN LAND TITLE ASSOCIATON RESIDENTIAL TITLE INSURANCE POLICY 4. AMERICAN LAND TITLE ASSOCIATION LOAN POLICY M SCHEDULE A THE ESTATE OR INTEREST IN THE LAND HEREINAFTER DESCRIBED OR REFERRED TO COVERED BY THIS REPORT IS: A FEE TITLE TO SAID ESTATE OR INTEREST AT THE DATE HEREOF IS VESTED IN: VORAYUT HUTPUTTANASIN AND JULAI HUTPUTTANASIN, HUSBAND AND WIFE AS JOINT TENANTS tI-9 th© original.exa BYgTEiTi~E ESCROW 20128056 SCHEDULE A (CONTINUED) DESCRIPTION: THE LAND REFERRED TO HEREIN IS SITUATED IN THE COUNTY OF ORANGE, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS: LOT 15 OF TRACT NO. 4153, IN THE CITY OF HUNTINGTON BEACH, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS SHOWN ON A MAP RECORDED IN BOOK 174, PAGES 13 AND 14 OF MISCELLANEOUS MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID ORANGE COUNTY. �Hfil#18E� �t� �tci true and exa co the original. By STEWARIITITLE ESCROW 20128056 SCHEDULE B AT THE DATE HEREOF, EXCEPTIONS TO COVERAGE IN ADDITION TO THE PRINTED EXCEPTIONS AND EXCLUSIONS CONTAINED IN SAID POLICY OR POLICIES WOULD BE AS FOLLOWS: A. GENERAL AND SPECIAL CITY AND/OR COUNTY TAXES FOR THE FISCAL YEAR 1996-97, TOTAL AMOUNT $2,839.92 FIRST INSTALLMENT $1,419.96, OPEN SECOND INSTALLMENT $1,419 .96, OPEN EXEMPTION $NONE CODE AREA 04-045 PARCEL NUMBER 165-233-07 NOT YET DUE AND PAYABLE B. THE LIEN OF SUPPLEMENTAL TAXES, IF ANY, ASSESSED PURSUANT TO THE PROVISIONS OF CHAPTER 3.5 (COMMENCING WITH SECTION 75) OF THE REVENUE AND TAXATION CODE OF THE STATE OF CALIFORNIA. C. THE LIEN OF ANY SPECIAL TAX RESULT::NG FROM THE INCLUSION OF THE PROPERTY IN A SPECIAL ASSESSMENT DISTRICT OR MELLO-ROOS CO'.VLiUNITY FACILITIES DISTRICT IN ACCORDANCE WITH THE CODES, WHICH MAY EXIST BY VIRTUE OF ASSESSMENT MAPS OR NOTICES FILED AND/OR RECORDED BY ANY SUCH DISTRICT. ASSESSMENTS, IF ANY, ARISING FROM SUCH ASSESSMENT DISTRICTS WILL BE COLLECTED ALONG WITH THE REGULAR ORANGE COUNTY REAL ESTATE TAXES. 1. OUR EXAMINATION OF THE RECORD TITLE TO THE HEREIN DESCRIBED LAND DOES NOT DISCLOSE ANY EXISTING LOANS. WE THEREFORE REQUEST A COPY OF THE OWNERS DISCLOSURE STATEMENT WITH REFERENCE TO EXISTING ENCUMBRANCES TO RECONFIRM OUR FINDINGS. 2. OTHER MATTERS OF RECORD WHICH DO NOT DESCRIBE SAID LAND, BUT WHICH, IF ANY EXIST, MAY AFFECT THE TITLE. THE NECESSARY SEARCH AND EXAMINATION WILL BE COMPLETED WHEN A STATEMENT OF INFORMATION HAS BEEN RECEIVED FROM ALL PARTIES. 3 . THE REQUIREMENT THAT WE BE FURNISHED WITH EVIDENCE AS TO WHAT TYPE OF ENTITY IS COMMUNITY HOUSING CORP. (I .E. - A CORPORATION, A GENERAL OR LIMITED PARTNERSHIP OR LIMITED LIABILITY COMPANY. ) SAID ENTITY IS APPARENTLY TO BE A PASS-THROUGH ACCOMMODATOR IN A RELOCATION TRANSACTION. Cert� #sue and ex t c yr a original. By STEWART TITLE ESCROW 20128056 TO AVOID DELAYS IN CLOSING YOUR TRANSACTION PLEASE SUPPLY US WITH THIS INFORMATION AS SOON AS POSSIBLE. WE WILL HAVE ADDITIONAL REQUIREMENTS THAT WILL VARY DEPENDING UPON WHICH TYPE OF ENTITY IS APPLICABLE. . IN THE EVENT SAID ENTITY IS NOT TO COME INTO TITLE, THIS REQUIREMENT MAY BE IGNORED. 4 . EXCEPT ALL WATER, CLAIMS OR RIGHTS TO WATER, IN OR UNDER SAID LAND. NOTES: 1 ) SHORT TERM RATE. 2 ) ACCORDING TO THOSE PUBLIC RECORDS, WHICH UNDER THE RECORDING LAWS IMPART CONSTRUCTIVE NOTICE TO THE TITLE TO THE LAND DESCRIBED HEREIN, THE FOLLOWING MATTERS CONSTITUTE THE CHAIN OF TITLE FOR THE SIX MONTH PERIOD PRECEDING THE DATE HEREOF: A DEED DATED MARCH 4, 1996 EXECUTED BY ORCHID INVESTMENT, LTD. , A CALIFORNIA CORPORATION IN FAVOR OF VORAYUT HUTPUTTANASIN AND JULAI HUTPUTTANASIN, HUSBAND AND WIFE AS JOINT TENANTS RECORDED MAY 31 1996 INSTRUMENT NO. 96-0222966, OFFICIAL RECORDS 3) AN INSPECTION OF SAID LAND DISCLOSES IMPROVEMENTS THEREON OF A MULTIPLE FAMILY RESIDENCE DESIGNATED AS: 17432 QUEENS LANE, HUNTINGTON BEACH, CALIFORNIA. 4) OUR A.L.T.A. POLICY WHEN ISSUED WILL CONTAIN C.L.T.A. INDORSEMENTS 100 AND 116. 5) PLEASE BE AWARE MANY LENDERS ARE NOW REQUIRING ANY REQUEST FOR UP-DATED INFORMATION, CONFIRMATION OF FIGURES AND THE PAY-OFF CHECK BE FROM THE TITLE COMPANY TO WHICH THE DEMAND WAS SENT OR WHICH WAS NOTED ON THE DEMAND AS THE TITLE COMPANY IN THE TRANSACTION. THEREFOR, THIS COMPANY WILL REQUIRE ANY DEMANDS FOR EXISTING LIENS B_E DIRECTED TO "STEWART TITLE OF CALIFORNIA" OR AT LEAST NOTED THEREON AS THE TITLE COMPANY THAT WILL BE INSURING THE PROPOSED TRANSACTION. PLEASE BE SURE SUCH DEMANDS ALSO REFERENCE OUR ORDER NUMBER AS WELL AS YOUR ESCROW NUMBER. ADDITIONAL NOTE: DIRECT WIRE TRANSFERS TO: WELLS FARGO BANK N.A. SAN FRANCISCO, CA 94163 ABA ROUTING NUMBER: #121000248 CREDIT: STEWART TITLE OF CALIFORNIA ACCOUNT NUMBER: 4159395573 Certifi t be a e and exa Dpyicf riginal. By STEWART TITt, . ESCROW I 20128056 PLEASE REFERENCE: ESCROW/TITLE OFFICER ESCROW/TITLE NUMBER Cerfm +ua d original. exac co By TITLE ESCROW NOTE FOR INFORMATION 1. IN THE EVENT THIS COMPANY IS ASKED TO ISSUE THE 1970 FORM OF THE ALTA LOAN POLICY, THE ALTA LEASEHOLD LOA14 POLICY, THE ALTA CONSTRUCTION LOAN POLICY(IES) OF TITLE INSURANCE, WHEN ISSUED, IT WILL CONTAIN THE FOLLOWING LANGUAGE AS A NEW EXCLUSION TO BE ADDED AS THE NEXT NUMBERED EXCLUSION IN EACH POLICY: ANY CLAIM, WHICH ARISES OUT OF THE TRANSACTION CREATING THE INTEREST OF THE MORTGAGEE INSURED BY THIS POLICY, BY REASON OF THE OPERATION OF FEDERAL BANKRUPTCY, STATE INSOLVENCY, OR SIMILAR CREDITORS' RIGHTS LAWS." THE ABOVE MATTER WILL BE ACCOMPLISHED BY MEANS OF AN ENDORSEMENT TO BE ATTACHED TO SAID POLICIES. 2. IN THE EVENT THIS COMPANY IS ASKED TO ISSUE THE ALTA-R FORM OF TITLE POLICY, THIS COMPANY WILL REQUIRE WE BE GIVEN SUFFICIENT TIME, AFTER NOTICE OF SUCH A REQUEST, TO PERFORM A PHYSICAL INSPECTION OF THE LAND. UPON COMPLETION OF SUCH AN INSPECTION WE WILL ADVISE YOU OF ANY ADDITIONAL OBJECTIONS TO TITLE WE MAY RAVE. 3. IN THE EVENT THIS COMPANY IS ASKED TO ISSUE THE ALTA RESIDENTIAL TITLE INSURANCE POLICY (6-1-87) r UNLESS AGREED TO IN WZITING PRIOR TO CLOSING, WHEN ISSUED, IT WILL CONTAIN ALL OF WESTERN REGIONAL EXCEPTIONS IN PART I OF SCHEDULE "B" OF SUCH POLICY. EerIifie • a aFiA exa opy f original. By— RT I LB ESCROW r :LTA PRELIMINARY REPORT FORM CLTA PRELIMINARY REPORT FORM LIST OF PRINTED EXCEPTIONS AND EXCLUSIONS SCHEDULE B 1. CALIFORNIA LAND TITLE ASSOCIATION STANDARD COVERAGE POLICY - 1990 EXCLUSIONS FROM COVERAGE 'HE FOLLOWING MATTERS ARE EXPRESSLY EXCLUDED FROM THE COVERAGE OF THIS POLICY AND THE COMPANY WILL NOT PAY LOSS :R DAMAGE, COSTS. ATTORNEYS' FEES OR EXPENSES WHICH ARISE BY REASON OF: (A) ANY LAW. ORDINANCE OR GOVERNMENTAL REGULATION (INCLUDING BUT NOT LIMITED TO BUILDING OR ZONING LAWS. ORDINANCES. OR REGULATIONS) RESTRICTING. REGULATING. PROHIBITING OR RELATING TO 11) THE OCCUPANCY, USE, OR ENJOYMENT OF THE LAND; (111 THE CHARACTER, DIMENSIONS OR LOCATION OF ANY IMPROVEMENT NOW OR HEREAFTER ERECTED ON THE LAND; (111) A SEPARATION IN OWNERSHIP OR A CHANGE IN THE DIMENSIONS OR AREA OF THE LAND OR ANY PARCEL OF WH CH TH: LAND IS OR WAS A PART; OR (IV) ENVIRONMENTAL PROTECTION, OR THE EFFECT OF ANY VIOLATION OF THESE LAWS, ORDINANCES OR GOVERNMENTAL REGULATIONS, EXCEPT TO THE EXTENT THAT A NOTICE OF THE ENFORCEMENT THEREOF OR A NOTICE OF A DEFECT, LIEN OR ENCUMBRANCE RESULTING FROM A VICLATION OR ALLEGED VIOLATION AFFECTING THE LAND HAS BEEN RECORDED IN THE PUBLIC RECORDS AT DATE OF POLICY. (B) ANY GOVERNMENTAL POLICE POWER NOT EXCLUDED BY JAI ABOVE, EXCEPT TO THE EXTENT THAT A NOTICE OF THE EXERCISE THEREOF OR A NOTICE OF A DEFECT, LIEN OR ENCUMBRANCE: RESULTING FROM A VIOLATION OR ALLEGED VIOLATION AFFECTING THE LAND HAS BEEN RECORDED IN THE PUBLIC RECORDS AT DATE OF POLICY. RIGHTS OF EMINENT DOMAIN UNLESS NOTICE OF THE EXERCISE THEREOF HAS BEEN RECORDED IN THE PUBLIC RECORDS AT DATE OF POLICY, BUT NOT EXCLUDING FROM COVERAGE ANY TAKING WHICH HAS OCCURRED PRIOR TO DATE: OF POLICY WHICH WOULD BE BINDING ON THE RIGHTS OF A PURCHASER FOR VALUE WITHOUT KNOW:EDGE. . DEF:CTS, LIENS, ENCUMBRANCES, ADVERSE CLAIMS OR OTHER MATTERS: (A) WHETHER OR NOT RECORDED IN THE PUBLIC RECORDS AT DATE 02 POLICY, BUT CREATED, SUFFERED. ASSUMED OR AGREED TO BY THE INSURED CLAIMANT; (B) NOT KNOWN TO THE: COMPANY, NOT RECORDED IN THE PUBLIC RECORDS AT DATE OF POLICY, BUT KNOWN TO THE INSURED CLAMANT AND NOT DISCLOSED IN WRITING TO THE COMPANY BY THE INSURED CLAIMANT PRIOR TO THE DATE THE INSURED CLA MANT BECAME, AN INSURED UNDER THIS POLICY; (CI RESULTING IN NO LOSS OR DAMAGE TO THE INSURED CLAIMANT; (D) ATTACHING OR CREATED SUBSEQUENT TO DATE OF POLICY; OR (E) RESULTING IN LOSS OR DAMAGE WHICH WOULD NOT HAVE BEEN SUSTAINED IF THE INSURED CLAIMANT HAD PAID VALUE FOR THE INSURED MORTGAGE OR FOR THE ESTATE OR INTEREST INSURED BY THIS POLICY. UNENFORCEAB11TY OF THE LIEN OF THE INSURED MORTGAGE BECAUSE OF THE INABILITY OR FAILURE OF THE INSURED AT DATE OF POLICY, OR THE INABILITY OR FAILURE OF ANY SUBSEQUENT OWNER OR INDEBTEDNESS, TO COMPLY WITH THE APPLICABLE DOING BUSINESS LAWS, OF THE STATE IN WHICH THE LAND IS SITUATED. INVALIDITY OR UNENFORCEABILITY OF THE LIEN OF THE INSURED MORTGAGE, OR CLAIM THEREOF,WHICH ARISES OUT OF THE TRANSACTION EVIDENCED BY THE INSURED MORTGAGE AND IS BASED UPON USURY OR ANY CONSUMER CREDIT PROTECTION OR TRUTH IN LENDING LAW. ANY CLAIM, WHICH ARISES OUT OF THE TRANSACTION VESTING IN THE :NSURED THE ESTATE OR INTEREST INSURED BY THIS POLICY OR THE TRANSACTION CREATING THE INTEREST OF THE INSURED LENDER, BY REASON OF THE OPERATION OF FEDERAL BANKRUPTCY, STATE INSOLVENCY OR SIMILAR CREDITORS' RIGHTS LAWS. EXCEPTIONS FROM COVERAGE 'HIS POLICY DOES NOT INSURE AGAINST LOSS OR DAMAGE (AND THE COMPANY WILL NOT PAY COSTS, ATTORNEYS' FEES OR :XPEN SES) WHICH ARISE: BY REASON OF; TAXES OR ASSESSMENTS WHICH ARE NOT SHOWN AS EXISTING LIENS EY THE RECORDS OF ANY TAXING AUTHORITY THAT LEVIES TAXES OR ASSESSMENTS ON REAL PROPERTY OR BY THE PUBLIC RECORDS. PROCEEDINGS Y A PUBLIC AGENCY WHICH MAY RESULT IN TAXES OR ASSESSMENTS. OR NOTICES OF SUCH PROCEEDINGS. WHETHER OR NOT SHOWN BY THE RECORDS OF SUCH AGENCY OR BY THE PUBLIC RECORDS. ANY FACTS• RIGHTS, INTERESTS OR CLAIMS WHICH ARE NOT SHOWN BY THE PUBLIC RECORDS BUT WHICH COULD BE ASCCRTAIN:D BY AN INSPECTION OF THE LAND OR WHICH MAY BE ASSERTED BY PERSONS IN POSSESSION THEREOF. EASEMENTS, LIENS OR ENCUMBRANCES, OR CLAIMS THEREOF, WHICH A.F.E NOT SHOWN BY THE PUBLIC RECORDS. DISCREPANCIES, CONFLICTS IN BOUNDARY LINES, SHORTAGE IN AREA. ENCROACHMENTS, OR ANY OTHER FACTS WHICH A COR.aECT SURVEY WOULD DISCLOSE, AND WHICH ARE NOT SHOWN BY THE PUBLIC RECORDS. (A) L'NPATENTED MINING CLAIMS; (B) RESERVATIONS OR EXCEPTIONS IN PATENTS OR IN ACTS AUTHORIZING THE ISSUANCE THEREOF; IC) WATER RIGHTS, CLAIMS OR TITLE TO WATER, WHETHER OR NOT THE MATTERS EXCEPTED UNDER (A), (B) OR IC) A.RE SHOWN BY THE PUBLIC RECORDS. Cer • a true and [LIST OF PRINTED EXCEPTIONS AND EXCLUSIONS CONTINUED ON NE" i�r the original. AGE I OF a GSUAR�a ANtR TITLt. ESCROW LTA PRELIMINARY REPORT FOP.: 2. AMERICAN LAND TITLE ASSOCIATION RESIDENTIAL TITLE INSURANCE POLICY (6-1-87) EXCLUSIONS I ADDITION TO THE EXCEPTIONS IN SCHEDULE B. YOU ARE NOT INSURED AGAINST LOSS, COSTS, ATTORNEYS' FEES, AND XPENSES RESULTING FROM. GOVERNMENTAL POLICE POWER, AND THE EXISTENCE OR VIOLATION OF ANY LAW OR GOVERNMENTAL REGULATION. THIS INCLUDES BUILDING AND ZONING ORDINANCES AND ALSO LAWS AND REGULATIONS CONCERNING: • LAND USE • IMPROVEMENTS ON THE LAND • LAND DIVISION " ENVIRONMENTAL PROTECTION THIS EXCLUSION DOES NOT APPLY TO VIO:ATIONS OR THE ENFORCEMENT OF THESE MATTERS WHICH APPEAR IN THE PUBLIC RECORDS AT POLICY DATE. THIS EXCLUSION DOES NOT LIMIT THE ZONING COVERAGE DESCRIBED IN ITEMS 12 AND 13 OF COVERED TITLE RISKS. THE RIGHT TO TAKE THE LAND BY CONDEMNING IT. UNLESS: • A NOTICE OF EXERCISING THE RIGHT APPEARS IN THE PUBLIC RECORDS ON THE POLICY DATE • THE TAKING HAPPENED PRIOR TO THE POLICY DATE AND IS BINDIN3 ON YOU IF YOU BOUGHT THE LAND WITHOUT KNOWING OF THE TAKING TITLE RISKS: • THAT ARE CREATED, ALLOWED, OR AGREED TO BY YOU • THAT ARE KNOWN TO YOU, BUT NOT TO US, ON THE POLICY DATE - - UNLESS THEY APPEARED IN THE PUBLIC RECORDS • THAT RESULT IN NO LOSS TO YOU • THAT FIRST AFFECT YOUR TITLE AFTER THE POLICY DATE - - THIS DOES NOT LIMIT THE LABOR AND MATERIAL LIEN COVERAGE IN STEM 8 OF COVERED TITLE RISKS FAILURE TO PAY VALUE FOR YOUR TITLE. LACK OF A RIGHT; • TO ANY LAND OUTSIDE THE AREA SPECIFICALLY DESCRIBED AND REFERRED TO IN ITEM 3 OF SCHEDULE A OR • IN STREETS, ALLEYS, OR WATERWAYS THAT TOUCH YOUR LAND THIS EXCLUSION DOES NOT LIMIT THE ACCESS COVERAGE IN ITEM 5 CF COVERED TITLE RISKS. 3. AMERICAN LAND TITLE ASSOCIATION LOAN POLICY (10-17-92) WITH ALTA ENDORSEMENT -- FORM 1 COVERAGE AND ' AMERICAN LAND TITLE ASSOCIATION LEASEHOLD LOAN POLICY (10-17-92) WITH ALTA ENDORSEMENT - FORM 1 COVERAGE EXCLUSIONS AND COVERAGE -iE FCLLOWING MATTERS ARE EXPRESSLY EXCLUDED FROM THE COVERAGE OF THIS POLICY AND THE COMPANY WILL NOT PAY 3SS OR DAIVAGE, COSTS, ATTORNEY'S FEES OR EXPENSES WHICH ARISE BY REASON OF: (A) ANY LAW, ORDINANCE OR GOVERNMENTAL REGULATION (INCLUDING BUT NOT LIMITED TO BUILDING AND ZONING LAWS. ORDINANCES, OR REGULATIONS) RESTRICTING, REGULATING, PROHIBITING OR RELATING TO (1) THE OCCUPANCY. USE, OR ENJOYMENT OF THE LAND; {III THE CHARACTER, DIMENSIONS OR LOCATION OF ANY IMPROVEMENT NOW OR HEREAFTER ERECTED ON THE LAND; 1111) A SEPARATION IN OWNERSHIP OR A CHANGE IN THE DIMENSIONS OR AREA OF THE LAND OR ANY PARCE�. OF WHICH THE LAND IS OR WAS A PART; OR (IV) ENVIRONMENTAL PROTECTION, OR THE EFFECT OF ANY VIOLATION OF THESE LAWS, ORDINANCES OR GOVERNMENTAL REGULATIONS, EXCEPT TO THE EXTENT THAT A NOTICE OF THE ENFORCEMENT THEREOF OR A NOTICE OF A DEFECT, LIEN OR ENCUMBRANCE RESULTING FROM A VIOLATION OR ALLEGED VIOLATION AFFECTING THE LAND HAS BEEN RECORDED IN THE PUBLIC RECORDS AT DATE OF POLICY. (B) ANY GOVERNMENTAL POLICE POWER NOT EXCLUDED BY (A) ABOVE. EXCEPT TO THE EXTENT THAT A NOTICE OF THE EXERCISE THEREOF OR A NOTICE OF A DEFECT, LIEN OR ENCUMBRANCE RESULTING FROM A VIOLATION OR ALLEGED VIOLATION AFFECTING THE LAND HAS BEEN RECORDED IN THE PUBLIC RECORDS AT DATE OF POLICY. RIGHTS OF EMINENT DOMAIN UNLESS NOTICE OF THE EXERCISE THEREOF HAS BEEN RECORDED IN THE PUBLIC RECORDS AT DATE OF POLICY, BUT NOT EXCLUDING FROM COVERAGE ANY TAKING WHICH HAS OCCURRED PRIOR TO DATE OF POLICY WHICH WOULD BE BINDING ON THE RIGHTS OF A PURCHASER FOR VALUE WITHOUT KNOWLEDGE_ 6e Wo FLJA aAd(LIST OF PRINTED EXCEPTIONS AND EXCLUSIONS CONTINUED ON NEXToriginal. ;V. 1992 STE.-' 17j acE 2 of 4 GUARANTY C01 ART ITLE ESOROW ZLTP. PRELIMINARY REPORT FORM 3. DEFECTS, LIENS, ENCUMBRANCES. ADVERSE CLAIMS OR OTHER MATTERS: (A)-CREATED. SUFFERED, ASSUMED OR AGREED TO BY THE INSURED CLAIMANT; '(BI NOT KNOWN TO THE COMPANY, NOT RECORDED IN THE PUBLIC RE COROS AT DATE OF POLICY, BUT KNOWN TO THE INSURED CLAIMANT AND NOT DISCLOSED IN WRITING TO THE COMPANY BY THE INSURED CLAIMANT PRIOR TO THE DATE THE INSURED CLAIMANT BECAME AN INSURED UNDER THIS POLICY; (C) RESULTING IN NO LOSS OR DAMAGE TO THE INSURED CLAIMANT; ID) ATTACHING OR CREATED SUBSEQUENT TO DATE OF POLICY (EXCEFT TO THE EXTENT THAT THIS POLICY INSURES THE PRIORITY OF THE LIEN OF THE INSURED MORTGAGE OVER ANY STATUTORY LIEN FOR SERVICES, LABOR OR MATERIAL OR TO THE EXTENT INSURANCE IS AFFORDED HEREIN AS TO THE ASSESSMENTS FOR STREET IMPROVEMENTS UNDER CONSTRUCTION OR COMPLETE] AT DATE OF POLICY); OR (El RESULTING IN LOSS OR DAMAGE WHICH WOULD NOT HAVE BEEN SUSTAINED IF THE INSURED CLAIMANT HAD PAID VALUE FOR THE INSURED MORTGAGE. s. UNENFORCEABILITY OF THE LIEN OF THE INSURED MORTGAGE BECAUSE OF THE INABILITY OR FAILURE OF THE INSURED AT DATE OF POLICY, OR THE INABILITY OR FAILURE OF ANY SUBSEQUENT OWNER OF THE INDEBTEDNESS. TO COMPLY WITH APP.ICABLE DOING BUSINESS LAWS OF TFE STATE IN WHICH THE LAND IS SITUATED. S. INVALIDITY OR UNENFORCEABILITY OF THE LIEN OF THE INSURED MORTGAGE, OR CLAIM THEREOF, WHICH ARISES OUT OF THE TRANSACTION EVIDENCED BY THE INSURED MORTGAGE AND IS BASED UPON USURY OR ANY CONSUMER CREDIT PROTECTION OR TRUTH IN LENDING LAW. S. ANY STATUTORY LIEN FOR SERVICES, LABOR OR MATERIALS (OR THE CLAIM OF PRIORITY OF ANY STATUTORY LIEN FOR SERVICES, LABOR OR MATERIALS OVER THE LIEN OF THE INSURED MORTGAGE) ARISING FROM AN IMPROVEMENT OR WORK RELATED TO THE LAND WHICH IS CONTRACTED FOR AND COMMENCED SUBSEQUENT TO DATE OF POLICY AND IS NOT FINANCED IN WHOLE OR IN PART BY PROCEEDS OF THE INDEBTEDNESS SECURED BY THE INSURED MORTGAGE WHICH AT DATE OF POLICY THE INSURED HAS ADVANCED OR IS OBLIGATED TO ADVANCE. '. ANY CLAIM, WHICH ARISES OUT OF THE TRANSACTION CREATING THE INTEREST OF THE MORTGAGEE INSURED BY THIS POLICY, BY REASON OF THE OPERATION OF FEDERAL BANKRUPTCY, STATE INSOLVENCY, OR SIMILAR CREDITORS' RIGHTS LAWS, THAT IS BASED ON: (1) THE TRANSACTION CREATING THE INTEREST OF THE INSURED MORTGAGEE BEING DEEMED A FRAUDULENT CONVEYANCE OR FRADULENT TRANSFER; OR (11) THE SUBORDINATION OF THE INTEREST OF THE INSURED MORTGAGEE AS A RESULT OF THE APPLICATION OF THE DOCTRINE OF EQUITABLE SUBORDINATION; OR fill) THE TRANSACTION CREATING THE INTEREST OF THE INSURED MORTGAGEE BEING DEEMED A PREFERENTIAL TRANSFER EXCEPT WHERE THE PREFERENTIAL TRANSFER RESULTS FROM THE FAILURE: (A) TO TIMELY RECORD THE INSTRUMENT OF TRANSFER; OR Is) OF SUCH RECORDATION TO IMPART NOTICE TO A PURCHASER FOR VALUE OR A JUDGEMENT OR LIEN CREDITOR. .HE AE OVE POLICY FORMS MAY BE ISSUED TO AFFORD EITHER STANDARD COVERAGE OR EXTENDED COVERAGE. IN ADDITION TO THE AEOVE{ EXCLUSIONS FROM COVERAGE, THE EXCEPTIONS FROM COVERAGE IN A STANDARD COVERAGE POLICY WILL ALSO IVCLUDE THE FOLLOWING GENERAL EXCEPTIONS: EXCEPTIONS FROM COVERAGE 'HIS POLICY DOES NOT INSURE AGAINST LOSS OR DAMAGE (AND THE COMPANY WILL NOT PAY COSTS, ATTORNEYS' FEES OR ;XPEN SESI W41CH ARISE BY REASON OF: '. TAXI'S OR ASSESSMENTS WHICH ARE NOT SHOWN AS EXISTING LIENS EY THE RECORDS OF ANY TAXING AUTHORITY THAT LEVI--S TAXES OR ASSESSMENTS ON REAL PROPERTY OR BY THE PUBLIC RECORDS. PRO(;EEDIN.aS BY A PUBLIC AGENCY WHICH MAY RESULT IN TAXES OR ASSESSMENTS, OR NOTICES OF SUCH PIAOCEEDINGS, WHETHER OR NOT SHOWN BY THE RECORDS OF SUCH AGENCY OR BY THE PUBLIC RECORDS. 1. ANY FACTS, RIGHTS, INTERESTS OR CLAIMS WHICH ARE NOT SHOWN BY THE PUBLIC RECORCS BUT WHICH COULD BE ASCERTAINCD BY AN INSPECTION OF THE LAND OR BY MAKING INQUIRY OF PERSONS IN POSSESSION THEREOF. 3. EASEMENTS. LIENS OR ENCUMBRANCES, OR CLAIMS THEREOF, WHICH AF.E NOT SHOWN BY THE PUBLIC RECORDS. :. DISCREPANCIES, CONFLICTS IN BOUNDARY LINES, SHORTAGE IN AREA, ENCROACHMENTS, OR ANY OTHER FACTS WHICH A CORRECT SURVEY WORLD DISCLOSE, AND WHICH ARE NOT SHOWN BY SHE PUBLIC RECORDS. S. (A) L:NPATEVTED MINING CLAIMS; 181 RESERVATIONS OR EXCEPTIONS IN PATENTS OR IN ACTS AUTHORIZING THE ISSUANCE THEREOF; (C) WATER RIGHTS, CLAIMS OR TITLE TO WATER, WHETHER OR NOT THE MATTERS EXCEPTED UNDER (A), (B) OR (C) ARE SHOWN BY THE PUBLIC RECORDS. 4. AMERICAN LAND TITLE ASSOCIATION OWNER'S POLICY (10-17-92) AND AMERICAN LAND TITLE ASSOCIATION LEASEHOLD OWNER'S POLICY (10-17-92) EXCLUSIONS FROM COVERAGE {LIST OF PRINTED EXCEPTIONS AND EXCLUSIONS CONTINUED ON NEXT PAGE , J sue apt Cerny REV. 1992 STEWART eN oPY riginal. ?AGE 3 OF 4 GUARANTY COMPANY BYSTEWART`i'tTC . ESCROW :LTA PRELIMINARY REPORT FORM 'HE FDLLOWING MATTERS ARE EXPRESSLY EXCLUDED FROM THE COVERAGE OF THIS POLICY AND THE COMPANY WILL NOT PAY .OSS OR DAMAGE, COST, ATTORNEYS' FEES OR EXPENSES WHICH ARISE Bf REASON OF: 1, (A) ANY LAW, ORDINANCE OR GOVERNMENTAL REGULATION (INCLUDING BUT NOT LIMITED TO BUILDING AND ZONING LAWS. ORDINANCES, OR REGULATIONS) RESTRICTING, REGULATING. PROiIBITING OR RELATING TO (1) THE OCCUPANCY, USE:. OR EVJOYMENT OF THE LAND; (11) TI-E CHARACTER, DIMENSIONS CR LOCATION OF ANY IMPROVEMENT NOW OR HEF:EAFTER ERECTED ON THE LAND; (Ill) A SEPARATION 1N OWNERSHIP OR A CHANGE IN THE. DIMENSIONS OR AREA OF THE LAND OR ANY PARCEL OF WHICH THE LAND IS OR WAS A PART; CA (IV) ENVIRONMENTAL PROTECTION, OR THE EFFECT OF ANY VIOLATION OF THESE LAWS, ORDINANCES OR GOVERNMENTAL PEGULATIONS, EXCEPT TO THE EXTENT THAT A NOTICE OF THE ENFORCEMENT THEREOF OR A NOTICE OF A DEFECT, LIEN OR ENCUMBRANCE RESULTING FROM A VIOLATION OR ALLEGED VIOLATION AFFECTING THE LAND HAS BEEN RECORDED IN THE PUBLIC RECORDS AT DATE OF POLICY. (B) ANY GOVERNMENTAL POLICE POWER NOT EXCLUDED BY (A) ABOVE. EXCEPT TO THE EXTENT THAT A NOTICE OF THE _EXERCISE THEREOF OR A NOTICE OF A DE=ECT. LIEN OR ENCUMBRANCE RESULTING FROM A VIOLATION OR ALLEGED VIOLATION AFFECTING THE LAND HAS BEEN RECORDED IN THE PUBLIC FECORDS AT DATE OF POLICY. 2. RIGHTS OF EMINENT DOMAIN UNLESS NOTICE OF THE EXERCISE THEREOF HAS BEEN RECORDED IN THE PUBLIC RECORDS AT DATE OF FOLICY, BUT NOT EXCLUDING FROM COVERAGE ANY TAKING WHICH HAS OCCURRED PRIOR TO DATE OF POLICY WHICH WOULD BE BINDING ON THE RIGHTS OF A PURCHASER FOR VALUE WITHOUT KNOWLEDGE. 3. DEFECTS, LIENS, ENCUMBRANCES, ADVERSE CLAIMS OR OTHER MATTERS: (Al CREATED. SUFFERED, ASSUMED OR AGREED TO BY THE INSURED CLAIMANT; (8) NOT KNOWN TO THE COMPANY, NOT RECORDED IN THE PUBLIC RECORDS AT DATE OF POLICY, BUT KNOWN TO THE INSURED CLAIMANT AND NOT DISCLOSED IN WRITING TO THE COMPANY BY THE INSURED CLAIMANT PRIOR TO THE DATE THE INSURED CLAIMANT BECAME AN INSURED UNDER THIS POLICY; (C) RESULTING IN NO LOSS OR DAMAGE TO THE INSURED CLAIMANT; ID) ATTACHING OR CREATED SUBSEQUENT TO DATE OF POLICY; OR (EI RESULTING IN LOSS OR DAMAGE WHICH WOULD NOT HAVE BEEN SUSTAINED IF THE INSURED CLAIMANT HAD PAID VALUE FOR THE ESTATE OR INTEREST INSURED BY THIS POLICY. 3. ANY CLAIM, WHICH ARISES OUT OF THE TRANSACTION VESTING IN THE INSURED THE ESTATE OR INTEREST INSURED BY THIS POLICY, BY REASON OF THE OPERATION OF FEDERAL BANKRUPTCY, STATE INSOLVENCY, OR SIMILAR CREDITORS' RIGHTS LAWS, THAT IS BASED ON: (1) THE TRANSACTION CREATING THE ESTATE OR INTEREST INSURED BY THIS POLICY BEING DEEMED A FRAUDULENT CONVEYANCE OR FRAUDULENT TRANSFER; OR (11) THE TRANSACTION CREATING THE ESTATE OR INTEREST INSURED BY THIS POLICY BEING DEEMED A PREFERENTIAL TRANSFER EXCEPT WHERE THE PREFERENTIAL TRANSFER RESULTS FROM THE FAILURE. (A) TO TIMELY RECORD THE INSTRUMENT OF TRANSFER; OR (BI OF SUCH RECORDATION TO IMPART NOTICE TO A PURCHASER FOR VALUE OR A JUDGEMENT OR LIEN CREDITOR. 'HE ABOVE POLICY FORMS MAY BE ISSUED TO AFFORD EITHER STANDARD COVERAGE OR EXTENDED COVERAGE. IN ADDITION TO THE AI]OVEE EXCLUSIONS FROM COVERAGE, THE EXCEPTIONS FROM COVERAGE IN A STANDARD COVERAGE POLICY WILL ALSO NCLUDE THE FOLLOWING GENERAL INSTRUCTIONS: EXCEPTIONS FROM COVERAGE , -HIS POLICY DOES NOT INSURE AGAINST LOSS OR DAMAGE (AND THE COMPANY WILL NOT PAY COSTS, ATTORNEYS' FEES OR :XPEN3ES) WHICH ARISE BY REASON OF: . TAXIES OR ASSESSMENTS WHICH ARE NOT SHOWN AS EXISTING LIENS BY THE RECORDS OF ANY TAXING AUTHORITY THAT LEVI ISTAXES OR ASSESSMENTS ON'REAL PROPERTY OR BY THE PUBLIC RECORDS. PROCEEDINGS BY A PUBLIC AGENCY WHICH MAY RESULT IN TAXES OR ASSESSMENTS, OR NOTICES OF SUCH PROCEEDINGS, WHETHER OR NOT SHOWN BY THE RECORDS OF SUCH AGENCY OR BY THE PUBLIC RECORDS. _'. ANY FACTS, RIGHTS, INTERESTS OR CLAIMS WHICH ARE NOT SHOWN BY THE PUBLIC RECORDS BUT WHICH COULD BE ASCERTAINED BY AN INSPECTION OF THE LAND OR BY MAKING INQUIRY OF PERSONS IN POSSESSION THEREOF. J. EASEMENTS, LIENS OR ENCUMBRANCES, OR CLAIMS THEREOF, WHICH ARE NOT SHOWN BY THE PUBLIC RECORDS. DISCREPANCIES, CONFLICTS IN BOUNDARY LINES, SHORTAGE IN AREA, ENCROACHMENTS, OR ANY OTHER FACTS WHICH A CORRECT SURVEY WOULD DISCLOSE. AND WHICH ARE NOT SHOWN BY THE PUBLIC RECORDS. i. (A) L'NPATENTED MINING CLAIMS; (B) RESERVATIONS OR EXCEPTIONS IN PATENTS OR IN ACTS AUTHORIZING THE ISSUANCE THEREOF; (C) WATER RIGHTS. CLAIMS OR TITLE TO WATER, WHETHER OR NOT THE MATTERS EXCEPTED UNDER (A), (8) OR (C) ARE SHOWN BY THE PUBLIC RECORDS. e ct c o original. IEV. 1992 STEWART ITL 'AGE 4 OF 4 GUARANTY S I lTLF ESCROW Ills IACi'A!,��3 FU A.S A � C � RtilayFO ._ IS as$u�.r:�jj}jrN US OILY,AU,3 l/C t o f a).0 Ot'�rCY cr.zrI A Ijf,%Ct E r10,rFrr• 7fU G I-ty ir,t[.,.,,,, Pa9. S 1/l.SE 114,NE.114,SEA X.M.R.11 W �. nr,w rRt t.rs.uleo rau owlot oanmr � 165_� At1lta,ot Oe.lt,/at11[+tL!OKl.11!ASSLti ti111 CAI!MO OIrMIIi+IX N T01fS.$4111K.* �'�. M as ski vtox at Al 22 _ 1� ql t!�t r�(Yrt74 J L AM!1"IIYS1 foornta�a onuw oowlrT'— m N a Amrr a a kUn .riffma 7R.4CT • s Aftfr s m r 7I,'QCTO i s i O u sJlr.r, = Rssr-fs ti w IS IO O a � o 1 1 +a., s I 1 J7 14 � tit tv, I Q 2S• 1 � O O 4 17 N 33 IJ 1. A O S S I , Ato 16 4Lfr le ; i rn is 1 J+u s ~ J m r S 2e 1 O +1 ; 13 = O N } 13 ? ,rat `ate-ad•./ I 1 ...w• NI ..M• WE `ate `a�• 1 i • 14 r. /[![r J A A[![r 0 laf I7 p . J /NI/1112 ' O �•;� {NC? 4JUI ;. ,�NQ 4/53 44%1 SLAIfR M 32 i Q s MARCH 1 b� r 9T6 tRACT /lti;t 4/SJ M M 1T4-/j./J L Npr[-ASSESSaIf BtOGt' 8 ASSESSOR'S MAP Q MA4•T A42 4301 M..AC 177-II.12 FAACEL MAISERS BOOK 165 AWA 23 TRACT Ala 5057 ALAI 102-6.7 SHOW! w CIRCLES cowry OF ORAIWCC CD PAWa MAP P.A1. I?J-?414J-4J v � STEWART TITLE PRELIMINARY REPORT ATTN: KATHY PALMER YOUR NO. 09029274 STEWART TITLE ESCROW - 2010 MAIN STREET #260 IRVINE, CALIFORNIA OUR NO. 20128051 DATED AS OF SEPTEMBER 27, 1996 AT 7:30 A.M. IN RESPONSE TO THE ABOVE REFERENCED APPLICATION FOR A POLICY OF TITLE INSURANCE, STEWART TITLE HEREBY REPORTS THAT IT IS PREPARED TO ISSUE, OR CAUSE TO BE ISSUED, AS OF THE DATE HEREOF, A STEWART TITLE GUARANTY COMPANY POLICY OR POLICIES OF TITLE INSURANCE DESCRIBING THE LAND AND THE ESTATE OR INTEREST THEREIN HEREINAFTER SET FORTH, INSURING AGAINST LOSS WHICH MAY BE SUSTAINED BY REASON OF ANY DEFECT, LIEN OR ENCUMBRANCE NOT SHOWN OR REFERENCED TO AS AN EXCEPTION ON SCHEDULE B OR NOT EXCLUDED FROM COVERAGE PURSUANT TO THE PRINTED SCHEDULES, CONDITIONS, AND STIPULATIONS OF SAID POLICY FORMS. THE PRINTED EXCEPTIONS AND EXCLUSIONS FROM THE COVERAGE OF SAID POLICY OR POLICIES ARE SET FORTH IN THE ATTACHED LIST. COPIES OF THE POLICY FORMS SHOULD BE READ. THEY ARE AVAILABLE FROM THE OFFICE WHICH ISSUED THIS REPORT. PLEASE READ THE EXCEPTIONS SHOWN OR REFERRED TO BELOW AND THE EXCEPTIONS AND EXCLUSIONS SET FORTH IN EXHIBIT A OF THIS REPORT CAREFULLY. THE EXCEPTIONS AND EXCLUSIONS ARE MEANT TO PROVIDE YOU WITH NOTICE OF MATTERS WHICH ARE NOT COVERED UNDER THE TERMS OF THE TITLE INSURANCE POLICY AND SHOULD BE CAREFULLY CONSIDERED. - IT IS IMPORTANT TO NOTE THAT THIS PRELIMINARY REPORT IS NOT A WRITTEN REPRESENTATION AS TO THE CONDITION OF TITLE AND MAY NOT LIST ALL LIENS, DEFECTS AND ENCUMBRANCES AFFECTING TITLE TO THE LAND. THIS REPORT, (AND ANY SUPPLEMENTS OR AMENDMENTS THERETO) IS ISSUED SOLELY FOR THE PURPOSE OF FACILITATING THE ISSUANCE OF A POLICY OF TITLE INSURANCE AND NO LIABILITY IS ASSUMED HEREBY. IF IT IS DESIRED THAT LIABILITY BE ASSUMED PRIOR TO THE ISSUANCE OF A POLICY OF TITLE INSURANCE A BINDER OR COMMITMENT SHOULD BE REQUESTED. MARTY O'LEARY TITLE OFFICER 2010 MAIN STREET, #250, IRVINE, CA 92714 (714) 476-0777 FAX NO. (714) 756-6077 MEMBER CALIFORNIA LAND TITLE ASSOCIATION Certified a#fire afld exact coo ho orlginal. sy-7 STEWAlkTtftLF. ESCROW 20128051 THE FORM OF THE POLICY OF TITLE INSURANCE CONTEMPLATED BY THIS REPORT IS: 1. CALIFORNIA LAND TITLE ASSOCIATION STANDARD COVERAGE POLICY (X) 2. AMERICAN LAND TITLE ASSOCIATION OWNERS POLICY FORM B 3. PYIERICAN LAND TITLE ASSOCIATON RESIDENTIAL TITLE INSURANCE POLICY 4. AMERICAN LAND TITLE ASSOCIATION LOAN POLICY (X) SCHEDULE A THE ESTATE OR INTEREST IN THE LAND HEREINAFTER DESCRIBED OR REFERRED TO COVERED BY THIS REPORT IS: A FEE TITLE TO SAID ESTATE OR INTEREST AT THE DATE HEREOF IS VESTED IN: HOME SAVINGS OF AMERICA, FSB Certm #° ao original.n exa c 13Y�TILMG►�I�T T i.G RQCRDW r 20128051 SCHEDULE A (CONTINUED) DESCRIPTION: THE LAND REFERRED TO HEREIN IS SITUATED IN THE COUNTY OF ORANGE, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS: LOT 14 OF TRACT NO. 4153, CITY OF HUNTIN3TON BEACH, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS SHOWN ON A MAP RECORDED IN BOOK 174, PAGES 12 AND 13, MISCELLANEOUS MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID ORANGE COUNTY. Certif' 'i a true and exa Co f o original. By _ QTiiWANmVLQ 219OAQW 20128051 SCHEDULE B AT THE DATE HEREOF, EXCEPTIONS TO COVERAGE IN ADDITION TO THE PRINTED EXCEPTIONS AND EXCLUSIONS CONTAINED IN SAID POLICY OR POLICIES WOULD BE AS FOLLOWS: A. GENERAL AND SPECIAL CITY AND/OR COUNTY TAXES FOR THE FISCAL YEAR 1996-97, TOTAL AMOUNT $3,157.40 FIRST INSTALLMENT $1,578.70, OPEN SECOND INSTALLMENT $1,578.70, OPEN EXEMPTION $NONE CODE AREA 04-045 PARCEL NUMBER 165-233-06 NOT YET DUE AND PAYABLE B. THE LIEN OF SUPPLEMENTAL TAXES, IF ANY, ASSESSED PURSUANT TO THE PROVISIONS OF CHAPTER 3.5 (COMMENCING WITH SECTION 75) OF THE REVENUE AND TAXATION CODE OF THE STATE OF CALIFORNIA. C. THE LIEN OF ANY SPECIAL TAX RESULTING FROM THE INCLUSION OF THE PROPERTY IN A SPECIAL ASSESSMENT DISTRICT OR MELLO-ROOS COMMUNITY FACILITIES DISTRICT IN ACCORDANCE WITH THE CODES, WHICH MAY EXIST BY VIRTUE OF ASSESSMENT MAPS OR NOTICES FILED AND/OR RECORDED BY ANY SUCH DISTRICT. ASSESSMENTS, IF ANY, ARISING FROM SUCH ASSESSMENT DISTRICTS WILL BE COLLECTED ALONG WITH THE REGULAR ORANGE COUNTY REAL ESTATE TAXES. D. ANY UNPAID AND/OR DELINQUENT BOND OR ASSESSMENT AMOUNTS FOR ANY 1911 OR 1915 ACT BONDS OR MELLO--ROOS TYPE COMMUNITY FACILITIES DISTRICTS, WHICH MAY HAVE BEEN REMOVED FROM THE ROLLS OF THE COUNTY TAX ASSESSOR AND WHICH MAY HAVE BEEN ` REMOVED FROM TAX BILLS AND TAX DEFAULT REDEMPTION AMOUNTS. 1. EXCEPT ALL WATER, CLAIMS OR RIGHTS TO WATER, IN OR UNDER SAID LAND. 2. ANY RIGHTS, INTEREST OR CLAIMS OF PARTIES IN POSSESSION OF THE LAND NOT SHOWN BY THE PUBLIC RECORDS. 3. OTHER MATTERS OF RECORD WHICH DO NOT DESCRIBE SAID LAND, BUT 4HICH, IF ANY EXIST, MAY AFFECT THE TITLE. THE NECESSARY SEARCH AND EXAMINATION WILL BE COMPLETED WHEN A STATEMENT OF INFORMATION HAS BEEN RECEIVED FROM ALL PARTIES. NOTES: Card ' t . a true end exa cap c original. By TOLE ESCROW 20128051 1) BASIC RATE. 2) AN INSPECTION OF SAID LAND DISCLOSES IMPROVEMENTS THEREON OF A MULTIPLE FAMILY RESIDENCE DESIGNATED AS: 17422 QUEENS LANE, HUNTINGTON BEACH, CALIFORNIA. 3) OUR A.L.T.A. POLICY WHEN ISSUED WILL CONTAIN C.L.T.A. INDORSEMENTS 100 AND 116. 4) PLEASE BE AWARE MANY LENDERS ARE NOW REQUIRING ANY REQUEST FOR UP-DATED INFORMATION, CONFIRMATION OF FIGURES AND THE PAY-OFF CHECK BE FROM THE TITLE COMPANY TO WHICH THE DEMAND WAS SENT OR WHICH WAS NOTED ON THE DEMAND AS THE TITLE COMPANY IN THE TRANSACTION. THEREFOR, THIS COMPANY WILL REQUIRE ANY DEMANDS FOR EXISTING LIENS BE DIRECTED TO "STEWART TITLE OF CALIFORNIA" OR AT LEAST NOTED THEREON AS THE TITLE COMPANY THAT WILL BE INSURING THE PROPOSED TRANSACTION. PLEASE BE SURE SUCH DEMANDS ALSO REFERENCE OUR ORDER NUMBER AS WELL AS YOUR ESCROW NUMBER. ADDITIONAL DOTE: DIRECT WIRE TRANSFERS TO: WELLS FARGO BANK N.A. SAN FRANCISCO, CA 94163 ABA ROUTING NUMBER: 121000248 CREDIT: STEWART TITLE ESCROW OF CALIFORNIA ACCOUNT NUMBER: 4159395532 PLEASE REFERENCE: ESCROW NUMBER 09029274 Gertiti ► ya We aAd exa copy original. By Tl LE ESCROW r NOTE FOR INFORMATION 1. IN THE EVENT THIS COMPANY IS ASKED TO ISSUE THE 1970 FORM OF THE ALTA LOAN POLICY, THE ALTA LEASEHOLD LOAN POLICY, THE ALTA CONSTRUCTION LOAN POLICY(IES) OF TITLE INSURANCE, WHEN ISSUED, IT WILL CONTAIN THE FOLLOWING LANGUAGE AS A NEW EXCLUSION TO BE ADDED AS THE NEXT NUMBERED EXCLUSION IN EACH POLICY: ANY CLAIM, WHICH ARISES OUT OF THE TRANSACTION CREATING THE INTEREST OF THE MORTGAGEE INSURED BY THIS POLICY, BY REASON OF THE OPERATION OF FEDERAL BANKRUPTCY, STATE INSOLVENCY, OR SIMILAR CREDITORS' RIGHTS LAWS. " THE ABOVE MATTER WILL BE ACCOMPLISHED BY MEANS OF AN ENDORSEMENT TO BE ATTACHED TO SAID POLICIES. 2. IN THE EVENT THIS COMPANY IS ASKED TO ISSUE THE ALTA-R FORM OF TITLE POLICY, THIS COMPANY WILL REQUIRE WE BE GIVEN SUFFICIENT TIME, AFTER NOTICE OF SUCH A REQUEST, TO PERFORM A PHYSICAL INSPECTION OF THE LAND. UPON COMPLETION OF SUCH AN INSPECTION WE WILL ADVISE YOU OF ANY ADDITIONAL OBJECTIONS TO TITLE WE MAY HAVE. 3. J.N THE EVENT THIS COMPANY IS ASKED TO ISSUE THE ALTA RESIDENTIAL TITLE INSURANCE POLICY (6-1--87) , UNLESS AGREED TO IN WRITING PRIOR TO CLOSING, WHEN ISSUED, IT WILL CONTAIN ALL OF WESTERN REGIONAL EXCEPTIONS IN PART I OF SCHEDULE "B" OF SUCH POLICY. Cer ' ' {� a tfua RA ex ci c the or19 BY STEWARD - TLE ESCROW LTA PRELIMINARY REPORT FORM CLTA PRELIMINARY REPORT FORM LIST OF PRINTED EXCEPTIONS AND EXCLUSIONS SCHEDULE B 1. CALIFORNIA LAND TITLE ASSOCIATION STANDARD COVERAGE POLICY - 1990 EXCLUSIONS FROM COVERAGE rHE FOLLOWING MATTERS ARE EXPRESSLY EXCLUDED FROM THE COVERAGE OF THIS POLICY AND THE COMPANY WILL NOT PAY LOSS )R DAMAGE, COSTS, ATTORNEYS' FEES OR EXPENSES WHICH ARISE BY REASON OF: (A) ANY LAW, ORDINANCE OR GOVERNMENTAL REGULATION (INCLUDING BUT NOT LIMITED TO BUILDING OR ZONING LAWS, ORDINANCES, OR REGULATIONS) RESTRICTING, REGULATING, PROHIBITING OR RELATING TO (1) THE OCCUPANCY, USE, OR ENJOYMENT OF THE LAND; (11) THE CHARACTER, DIMENSIONS OR LOCATION OF ANY IMPROVEMENT NOW OR HEREAFTER ERECTED ON THE LAND; (III) A SEPARATION IN OWNERSHIP OR A CHANGE IN THE DIMENSIONS OR AREA OF THE LAND OR ANY PARCEL OF WHICH THE LAND IS OR WAS A PART; OR (IV) ENVIRONMENTAL PROTECTION, OR THE EFFECT OF ANY VIOLATION OF THESE LAWS, ORDINANCES OR GOVERNMENTAL REGULATIONS, EXCEPT TO THE EXTENT THAT A NOTICE OF THE ENFORCEMENT THEREOF OR A NOTICE OF A DEFECT, LIEN OR ENCUMBRANCE RESULTING FROM A VIOLATION OR ALLEGED VIOLATION AFFECTING THE LAND HAS BEEN RECORDED IN THE PUBLIC RECORDS AT DATE OF POLICY. (B) ANY GOVERNMENTAL POLICE POWER NOT EXCLUDED BY (A) ABOVE, EXCEPT TO THE EXTENT THAT A NOTICE OF THE EXERCISE THEREOF OR A NOTICE OF A DEFECT, LIEN OR ENCUMBRANCE RESULTING FROM A VIOLATION OR ALLEGED VIOLATION AFFECTING THE LAND HAS BEEN RECORDED IN THE PUBLIC RECORDS AT DATE OF POLICY. 2. RIGHTS OF EMINENT DOMAIN UNLESS NOTICE OF THE EXERCISE THEREOF HAS BEEN RECORDED IN THE PUBLIC RECORDS AT DATE OF POLICY, BUT NOT EXCLUDING FROM COVERAGE ANY TAKING WHICH HAS OCCURRED PRIOR TO DATE OF POLICY WHICH WOULD BE BINDING ON THE RIGHTS OF A PURCHASER FOR VALUE WITHOUT KNOWLEDGE. ;. DEFECTS, LIENS, ENCUMBRANCES, ADVERSE CLAIMS OR OTHER MATTERS: (A) WHETHER OR NOT RECORDED IN THE PUBLIC RECORDS AT DATE OF POLICY, BUT CREATED, SUFFERED, ASSUMED OR AGREED TO BY THE INSURED CLAIMANT; (B) NOT KNOWN TO THE COMPANY, NOT RECORDED IN THE PUBLIC RECORDS AT DATE OF POLICY, BUT KNOWN TO THE INSURED CLAIMANT AND NOT DISCLOSED IN WRITING TO THE COMPANY BY THE INSURED CLAIMANT PRIOR TO THE DATE THE INSURED CLAIMANT BECAME AN INSURED UNDER THIS POLICY; (C) RESULTING IN NO LOSS OR DAMAGE TO THE INSURED CLAIMANT; (D) ATTACHING OR CREATED SUBSEQUENT TO DATE OF POLICY; OR (E) RESULTING IN LOSS OR DAMAGE WHICH WOULD NOT HAVE BEEN SUSTAINED IF THE INSURED CLAIMANT HAD PAID VALUE FOR THE INSURED MORTGAGE OR FOR THE ESTATE OR INTEREST INSURED BY THIS POLICY. =. UNENFORCEABILITY OF THE LIEN OF THE INSURED MORTGAGE BECAUSE OF THE INABILITY OR FAILURE OF THE INSURED AT DATE OF POLICY, OR THE INABILITY OR FAILURE OF ANY SUBSEQUENT OWNER OR INDEBTEDNESS, TO COMPLY WITH THE APPLICABLE DOING BUSINESS LAWS, OF THE STATE IN WHICH THE LAND IS SITUATED. �. INVALIDITY OR UNENFORCEABILITY OF THE LIEN OF THE INSURED MORTGAGE, OR CLAIM THEREOF, WHICH ARISES OUT OF THE TRANSACTION EVIDENCED BY THE INSURED MORTGAGE AND IS BASED UPON USURY OR ANY CONSUMER CREDIT PROTECTION OR TRUTH IN LENDING LAW. ANY CLAIM, WHICH ARISES OUT OF THE TRANSACTION VESTING IN THE INSURED THE ESTATE OR INTEREST INSURED BY THIS POLICY OR THE TRANSACTION CREATING THE INTEREST OF THE INSURED LENDER, BY REASON OF THE OPERATION OF FEDERAL BANKRUPTCY, STATE INSOLVENCY OR SIMILAR CREDITORS' RIGHTS LAWS. EXCEPTIONS FROM COVERAGE "HIS POLICY DOES NOT INSURE AGAINST LOSS OR DAMAGE (AND THE COMPANY WILL NOT PAY COSTS, ATTORNEYS' FEES OR :XPENSES) WHICH ARISE BY REASON OF: TAXES OR ASSESSMENTS WHICH ARE NOT SHOWN AS EXISTING LIENS BY THE RECORDS OF ANY TAXING AUTHORITY THAT LEVIES TAXES OR ASSESSMENTS ON REAL PROPERTY OR BY THE PUBLIC RECORDS. PROCEEDINGS BY A PUBLIC AGENCY WHICH MAY RESULT IN TAXES OR ASSESSMENTS, OR NOTICES OF SUCH PROCEEDINGS, WHETHER OR NOT SHOWN BY THE RECORDS OF SUCH AGENCY OR BY THE PUBLIC RECORDS. ANY FACTS, RIGHTS, INTERESTS OR CLAIMS WHICH ARE NOT SHOWN BY THE PUBLIC RECORDS BUT WHICH COULD BE ASCERTAINED BY AN INSPECTION OF THE LAND OR WHICH MAY BE ASSERTED BY PERSONS IN POSSESSION THEREOF. EASEMENTS, LIENS OR ENCUMBRANCES, OR CLAIMS THEREOF, WHICH ARE NOT SHOWN BY THE PUBLIC RECORDS. •. DISCREPANCIES, CONFLICTS IN BOUNDARY LINES, SHORTAGE IN AREA, ENCROACHMENTS, OR ANY OTHER FACTS WHICH A CORRECT SURVEY WOULD DISCLOSE, AND WHICH ARE NOT SHOWN BY THE PUBLIC RECORDS. (A) UNPATENTED MINING CLAIMS; (B) RESERVATIONS OR EXCEPTIONS IN PATENTS OR IN ACTS AUTHORIZING THE ISSUANCE THEREOF; (C) WATER RIGHTS, CLAIMS OR TITLE TO WATER, WHETHER OR NOT THE MATTERS EXCEPTED UNDER (A), (B) OR (C) ARE SHOWN BY THE PUBLIC RECORDS. + 6 ► a ifus apd (LIST OF PRINTED EXCEPTIONS AND EXCLUSIONS CONTINUED ON NEX f the original. EV. 1992 STEW; 'AGE 7 OF 4 GUARANTY C WART ITLE ESCROW CLV% PRELIMINARY REPORT FORM 2. AMERICAN LAND TITLE ASSOCIATION RESIDENTIAL TITLE INSURANCE POLICY (6-1-67) EXCLUSIONS IN ADDITION TO THE EXCEPTIONS IN SCHEDULE B. YOU ARE NOT INSURED AGAINST LOSS, COSTS, ATTORNEYS' FEES, AND EXPENSES RESULTING FROM: 1. GOVERNMENTAL POLICE POWER, AND THE EXISTENCE OR VIOLATION OF ANY LAW OR GOVERNMENTAL REGULATION. THIS INCLUDES BUILDING AND ZONING ORDINANCES AND ALSO LAWS AND REGULATIONS CONCERNING: • LAND USE " IMPROVEMENTS ON THE LAND * LAND DIVISION * ENVIRONMENTAL PROTECTION THIS EXCLUSION DOES NOT APPLY TO VIOLATIONS OR THE ENFORCEMENT OF THESE MATTERS WHICH APPEAR IN THE PUBLIC RECORDS AT POLICY DATE. THIS EXCLUSION DOES NOT LIMIT THE ZONING COVERAGE DESCRIBED IN ITEMS 12 AND 13 OF COVERED TITLE RISKS. 2. THE RIGHT TO TAKE THE LAND BY CONDEMNING IT, UNLESS: • A NOTICE OF EXERCISING THE RIGHT APPEARS IN THE PUBLIC RECORDS ON THE POLICY DATE * THE TAKING HAPPENED PRIOR TO THE POLICY DATE AND IS BINDIN3 ON YOU IF YOU BOUGHT THE LAND WITHOUT KNOWING OF THE TAKING 3. TITLE RISKS: * THAT ARE CREATED, ALLOWED, OR AGREED TO BY YOU * THAT ARE KNOWN TO YOU, BUT NOT TO US, ON THE POLICY DATE - - UNLESS THEY APPEARED IN THE PUBLIC RECORDS * THAT RESULT IN NO LOSS TO YOU * THAT FIRST AFFECT YOUR TITLE AFTER THE POLICY DATE - - THIS DOES NOT LIMIT THE LABOR AND MATERIAL LIEN COVERAGE IN ITEM 8 OF COVERED TITLE RISKS 4. FAILURE TO PAY VALUE FOR YOUR TITLE. S. LAC( OF A RIGHT: * TO ANY LAND OUTSIDE THE AREA SPECIFICALLY DESCRIBED AND REFERRED TO IN ITEM 3 OF SCHEDULE A OR • IN STREETS, ALLEYS, OR WATERWAYS THAT TOUCH YOUR LAND THIS EXCLUSION DOES NOT LIMIT THE ACCESS COVERAGE IN ITEM 5 OF COVERED TITLE RISKS. 3. AMERICAN LAND TITLE ASSOCIATION LOAN POLICY (10-17-92) WITH ALTA ENDORSEMENT -- FORM 1 COVERAGE AND AMERICAN LAND TITLE ASSOCIATION LEASEHOLD LOAN POLICY (10--17-92) WITH ALTA ENDORSEMENT - FORM 1 COVERAGE EXCLUSIONS AND COVERAGE THE FOLLOWING MATTERS ARE EXPRESSLY EXCLUDED FROM THE COVERAGE OF THIS POLICY AND THE COMPANY WILL NOT PAY _OSS OR DAMAGE, COSTS, ATTORNEY'S FEES OR EXPENSES WHICH ARISE EY REASON OF: I. (A) ANY LAZY, ORDINANCE OR GOVERNMENTAL REGULATION (INCLUDING BUT NOT LIMITED TO BUILDING AND ZONING LAWS, ORDINANCES, OR REGULATIONS) RESTRICTING, REGULATING, PROHIBITING OR RELATING TO (1) THE OCCUPANCY, USE, OR ENJOYMENT OF THE LAND: (11) THE CHARACTER, DIMENSIONS OR LOCATION OF ANY IMPROVEMENT NOW OR HEREAFTER ERECTED ON THE LAND; 11111 A SEPARATION 1N OWNERSHIP OR A CHANGE IN THE DIMENSIONS OR AREA OF THE LAND OR ANY PARCE. OF WHICH THE LAND IS OR WAS A PART; OR IIVI ENVIRONMENTAL PROTECTION, OR THE EFFECT OF ANY VIOLATION OF THESE LAWS, ORDINANCES OR GOVERNMENTAL REGULATIONS, EXCEPT TO THE EXTENT THAT A NOTICE OF THE ENFORCEMENT THEREOF OR A NOTICE OF A DEFECT, LIEN OR ENCUMBRANCE RESULTING FROM A VIOLATION OR ALLEGED VIOLATION AFFECTING THE LAND HAS BEEN RECORDED IN THE PUBLIC RECORDS AT DATE OF POLICY. IB) jf•NY GOVERNMENTAL POLICE POWER NOT EXCLUDED BY (A) ABOVE, EXCEPT TO THE EXTENT THAT A NOTICE OF THE EXERCISE THEREOF OR A NOTICE OF A DEFECT. LIEN OR ENCUMBRANCE RESULTING FROM A VIOLATION OR ALLEGED VIOLATION AFFECTING THE LAND HAS BEEN RECORDED IN THE PUBLIC RECORDS AT DATE OF POLICY. !. RIGHTS OF EMINENT DOMAIN UNLESS NOTICE OF THE EXERCISE THEREO= HAS BEEN RECORDED IN THE PURL RECORDS AT DATL' OF POLICY, BUT NOT EXCLUDING FROM COVERAGE ANY TAKING WHICH HAS OCCURRED I � acLUA WHICH WOULD BE BINDING ON THE RIGHTS OF A PURCHASER FOR VALUE WITHOUT KNOWLEDGE. mu 13 act C f 116 original. ;LIST OF PRINTED EXCEPTIONS AND EXCLUSIONS CONTINUED ON NEXT PAG y IEV. 1992 STEWART SMART TITLE ESCROW -'AGE 2 OF 4 GUARANTY COMPANY :LTA PRELIMINARY REPORT FORM i. DEFECTS, LIENS, ENCUMBRANCES, ADVERSE CLAIMS OR OTHER MATTERS. (A) CREATED, SUFFERED, ASSUMED OR AGREED TO BY THE INSURED CLAIMANT; (B) NOT K14OWN TO THE COMPANY, NOT RECORDED IN THE PUBLIC RECORDS AT DATE OF POLICY, BUT KNOWN TO THE INSURED CLAIMANT AND NOT DISCLOSED IN WRITING TO THE COMPANY BY THE INSURED CLAIMANT PRIOR TO THE DATE THE INSURED CLAIMANT BECAME AN INSURED UNDER THIS POLICY; (C) RESULTING IN NO LOSS OR DAMAGE TO THE INSURED CLAIMANT; (D) ATTACHING OR CREATED SUBSEQUENT TO DATE OF POLICY ;EXCEPT TO THE EXTENT THAT THIS POLICY INSURES THE PRIORITY OF THE LIEN OF THE INSURED MORTGAGE OVER ANY STATUTORY LIEN FOR SERVICES, LABOR OR MATERIAL OR TO THE: EXTErIT INSURANCE IS AFFORDED HEREIN AS TO THE ASSESSMENTS FOR STREET IMPROVEMENTS UNDER CONSTRUCTION OR COMPLETED AT DATE OF POLICY); OR (E) RESULTING IN LOSS OR DAMAGE WHICH WOULD NOT HAVE BEEN SUSTAINED IF THE INSURED CLAIMANT HAD PAID VALUE FOF: THE INSURED MORTGAGE. UNE:NFORCEABILITY OF THE LIEN OF THE INSURED MORTGAGE BECAUSE OF-THE INABILITY OR FAILURE OF THE INSURED AT DATE OF POLICY, OR THE INABILITY OR FAILURE OF ANY SUBSEQUENT OWNER OF THE INDEBTEDNESS, TO COMPLY WITH APFLICABLE: DOING BUSINESS LAWS OF THE STATE IN WHICH THE LAND IS SITUATED. +. INVALIDITY OR UN ENFORCEABILITY OF THE LIEN OF THE INSURED MORTGAGE, OR CLAIM THEREOF, WHICH ARISES OUT OF THE TRANSACTION EVIDENCED BY THE INSURED MORTGAGE AND IS BASED UPON USURY OR ANY CONSUMER CREDIT PROTECTION OR TRUTH IN LENDING LAW. �. ANY STATUTORY LIEN FOR SERVICES, LABOR OR MATERIALS (OR THE: CLAIM OF PRIORITY OF ANY STATUTORY LIEN FOR SERVICES, LABOR OR MATERIALS OVER ThE LIEN OF THE INSURED MORTGAGE) ARISING FROM AN IMPROVEMENT OR WORK RELATED TO THE LAND WHICH IS CONTRACTED FOR AND COMMENCED SUBSEQUENT TO DATE OF POLICY AND IS NOT FINANCED IN WHOLE OR IN PART BY PROCEEDS OF THE INDEBTEDNESS SECURED BY THE INSURED MORTGAGE WHICH AT DATE OF POLICY THE INSURED HAS ADVANCED OR IS OBLIGATED TO ADVANCE. ANY CLAIM, WHICH ARISES OUT OF THE TRANSACTION CREATING THE INTEREST OF THE MORTGAGEE INSURED BY THIS POLICY, BY REASON OF THE OPERATION OF FEDERAL BANKRUPTCY, STATE INSOLVENCY, OR SIMILAR CREDITORS' RIGHTS LAWS. THAT IS BASED ON: (1) THE TRANSACTION CREATING THE INTEREST OF THE INSURED MORTGAGEE BEING DEEMED A FRAUDULENT CONVEYANCE OR FRADULENT TRANSFER; OR (11) THE SUBORDINATION OF THE INTEREST OF THE INSURED MORTGAGEE AS A RESULT OF THE APPLICATION OF THE DOCTRINE OF EQUITABLE: SUBORDINATION; OR JIM THE TRANSACTION CREATING THE INTEREST OF THE INSURED MORTGAGEE BEING DEEMED A PREFERENTIAL TRANSFER EXCEPT WHERE THE PREFERENTIAL TRANSFER RESULTS FROM THE FAILURE: (A) TO TIMELY RECORD THE INSTRUMENT OF TRANSFER; OR (8) OF SUCH RECORDATION TO IMPART NOTICE TO A PURCHASER FOR VALUE OR A JUDGEMENT OR LIEN CREDITOR. 'HE ABOVE POLICY FORMS MAY BE ISSUED TO AFFORD EITHER STANDARD COVERAGE OR EXTENDED COVERAGE. IN ADDITION TO 'HE AVOVE EXCLUSIONS FROM COVERAGE, THE EXCEPTIONS FROM COVERAGE IN A STANDARD COVERAGE POLICY WILL ALSO NCLUDE THE FOLLOWING GENERAL EXCEPTIONS: EXCEPTIONS FROM COVERAGE 'HIS POLICY DOES NOT INSURE AGAINST LOSS OR DAMAGE (AND THE COMPANY WILL NOT PAY COSTS, ATTORNEYS' FEES OR 'XPEN:;ES) W-iICH ARISE BY REASON OF: TAXES OR ASSESSMENTS WHICH ARE NOT SHOWN AS EXISTING LIENS BY THE RECORDS OF ANY TAXING AUTHORITY THAT LEVI IS TAXES OR ASSESSMENTS ON REAL PROPERTY OR BY THE PUBLIC RECORDS. PROCEEDINGS BY A PUBLIC AGENCY WHICH MAY RESULT IN TAXES OR ASSESSMENTS, OR NOTICES OF SUCH PROCEEDINGS, WHETHER OR NOT SHOWN BY THE RECORDS OF SUCH AGENCY OR BY THE PUBLIC RECORDS. ANY FACTS, RIGHTS, INTERESTS OR CLAIMS WHICH ARE NOT SHOWN BY THE PUBLIC RECORDS BUT WHICH COULD BE ASCERTAINED BY AN INSPECTION OF THE LAND OR BY MAKING INQUIRY OF PERSONS IN POSSESSION THEREOF. EASEMENTS, LIENS OR ENCUMBRANCES, OR CLAIMS THEREOF, WHICH ARE NOT SHOWN BY THE PUBLIC RECORDS. DISCREPANCIES, CONFLICTS IN BOUNDARY LINES, SHORTAGE IN AREA. ENCROACHMENTS, OR ANY OTHER FACTS WHICH A CORRECT SURVEY WOULD DISCLOSE, AND WHICH ARE NOT SHOWN BY THE PUBLIC RECORDS. (A) UNPATENTED MINING CLAIMS; (B) RESERVATIONS OR EXCEPTIONS IN PATENTS OR IN ACTS AUTHORIZING THE ISSUANCE THEREOF, (C) WATER RIGHTS, CLAIMS OR TITLE TO WATER, WHETHER OF. NOT THE MATTERS EXCEPTED UNDER (A), (8) OR (C) ARE SHOWN BY THE PUBLIC RECORDS. 4. AMERICAN LAND TITLE ASSOCIATION OWNER'S POLICY (10-17-92) AND AMERICAN LAND TITLE ASSOCIATION LEASEHOLD OWNER'S POLICY (10-17-92) EXCLUSIONS FROM COVERAGE PTttWAR L d �FZ1A $Ad (LIST OF PRINTED EXCEPTIONS AND EXCLUSIONS CONTINUED ON NEXT 9 original. EV. 1992 STEWARMS AGE 3 OF 4 GUARANTY CO TITLE ESCROW LTA. PRELIMINARY REPORT FORM iE FOLLOWING MATTERS ARE EXPRESSLY EXCLUDED FROM THE COVERAGE OF THIS POLICY AND THE COMPANY WILL NOT PAY )SS OR DAMAGE, COST, ATTORNEYS' FEES OR EXPENSES WHICH ARISE BY REASON OF: (A) ANY LAW, ORDINANCE OR GOVERNMENTAL REGULATION (INCLUDING BUT NOT LIMITED TO BUILDING AND ZONING LAWS, ORCINANCES, OR REGULATIONSI RESTRICTING, REGULATING, PROHIBITING OF RELATING TO (11 THE OCCUPANCY, USE, OR ENJOYMENT OF THE LAND; (11) TH_ CHARACTER, DIMENSIONS OR LOCATION OF ANY IMPROVEMENT NOW OR HEREAFTEP ERECTED ON THE LAND; fill) A SEPARATION IN OWNERSHIP OR A CHANGE IN THE DIMENSIONS OR AREA OF THE LAND OR ANY PARCEL OF WHICH THE LAND IS OR WAS A PART; OR (IV) ENVIRONMENTAL PROTECTION, OR THE EFFECT OF ANY VIOLATION OF THESE LAWS, ORDINANCES OR GOVERNMENTAL REGULATIONS, EXCEPT TO THE EXTENT THAT A NOTICE OF THE EN=ORCEMENT THEREOF OR A NOTICE OF A DEFECT, LIEN OR ENCUMBRANCE RESULTING FROM A VIOLATION OR ALLEGED V OLATION AFFECTING THE LAND HAS BEEN RECORDED IN THE PUBLIC RECORDS AT DATE OF POLICY. (B) ANY GOVERNMENTAL POLICE POWER NOT EXCLUDED BY (A) ABOVE, EXCEPT TO THE EXTENT THAT A NOTICE OF THE EXERCISE THEREOF OR A NOTICE OF A DEFECT, LIEN OR ENCUMBRANCE RESULTING FROM A VIOLATION OR ALLEGED VIOLATION AFFECTING THE LAND HAS BEEN RECORDED IN THE PUBLIC RECORDS AT DATE OF POLICY. RIGHTS OF EMINENT DOMAIN UNLESS NOTICE OF THE EXERCISE THEREOF HAS BEEN RECORDED IN THE PUBLIC RECORDS AT DATE OF POLICY, BUT NOT EXCLUDING FROM COVERAGE ANY TAKING WHICH HAS OCCURRED PRIOR TO DATE OF POLICY WHICH WOULD BE BINDING ON THE RIGHTS OF A PURCHASER FOR VALUE WITHOUT KNOWLEDGE. DEFECTS, LIENS, ENCUMBRANCES, ADVERSE CLAIMS OR OTHER MATTERS: (A) CREATED, SUFFERED, ASSUMED OR AGREED TO BY THE INSURED CLAIMANT; IS) NOT KNOWN TO THE COMPANY, NOT RECORDED IN THE PUBLIC RECORDS AT DATE OF POLICY, BUT KNOWN TO THE INSURED CLAIMANT AND NOT DISCLOSED IN WRITING TO THE COMPANY BY THE INSURED CLAIMANT PRIOR TO THE DATE THE INSURED CLAIMANT BECAME AN INSURED UNDER THIS POLICY; ICI VESULTING IN NO LOSS OR DAMAGE TO THE INSURED CLAIMANT; (D) ATTACHING OR CREATED SUBSEQUENT TO DATE OF POLICY, OR (E) FESULTING IN LOSS OR DAMAGE WHICH WOULD NOT HAVE BEEN SUSTAINED IF THE INSURED CLAIMANT HAD PAID VALUE FOR THE ESTATE OR INTEREST INSURED BY THIS POLICY. ANY CLAIM. WHICH ARISES OUT OF THE TRANSACTION VESTING IN THE INSURED THE ESTATE OR INTEREST INSURED BY THIS POLICY, BY REASON OF THE OPERATICN OF FEDERAL BANKRUPTCY, STATE INSOLVENCY. OR SIMILAR CREDITORS' RIGHTS LAWS, THAT IS BASED ON: (1) THE TRANSACTION CREATING THE ESTATE OR INTEREST INSURED BY THIS POLICY BEING DEEMED A FRAUDULENT CONVEYANCE OR FRAUDULENT TRANSFER; OR 11) THE TRANSACTION CREATING THE ESTATE OR INTEREST INSURED BY THIS POLICY BEING DEEMED A PREFERENTIAL TRANSFER EXCEPT WHERE THE PREFERENTIAL TRANSFER RESULTS FROM THE FAILURE: IA) TO TIMELY RECORD THE INSTRUMENT OF TRANSFER; OR (8) OF SUCH RECORDATION TO IMPART NOTICE TO A PURCHASER FOR VALUE OR A JUDGEMENT OR LIEN CREDITOR. iE ABOVE POLICY FORMS MAY BE ISSUED TO AFFORD EITHER STANDARD COVERAGE OR EXTENDED COVERAGE. IN ADDITION TO iE ABOVE EXCLUSIONS FROM COVERAGE, THE EXCEPTIONS FROM COVERAGE IN A STANDARD COVERAGE POLICY WILL ALSO CLUOE THE FOLLOWING GENERAL INSTRUCTIONS: EXCEPTIONS FROM COVERAGE 'IS POLICY DOES NOT INSURE AGAINST LOSS OR DAMAGE (AND THE COMPANY WILL NOT PAY COSTS. ATTORNEYS' FEES OR PENSESI WHICH ARISE BY REASON OF: TAXES OR ASSESSMENTS WHICH ARE NOT SHOWN AS EXISTING LIENS BY THE RECORDS OF ANY TAXING AUTHORITY THAT LEVIES TAXES OR ASSESSMENTS ON REAL PROPERTY OR BY THE PUBLIC RECORDS. PROCEEDINGS BY A PUBLIC AGENCY WHICH MAY RESULT IN TAXES OR ASSESSMENTS, OR NOTICES OF SUCH PROCEEDINGS, WHE-HER OR NOT SHOWN BY THE RECORDS OF SUCH AGENCY OR BY THE PUBLIC RECORDS. ANY FACTS, RIGHTS, INTERESTS OR CLAIMS WHICH ARE NOT SHOWN BY THE PUBLIC RECORDS BUT WHICH COULD BE ASCERTAINED BY AN INSPECTION OF THE LAND OR BY MAKING INQUIRY OF PERSONS IN POSSESSION THEREOF. EASEMENTS. LIENS OR ENCUMBRANCES, OR CLAIMS THEREOF, WHICH ARE NOT SHOWN BY THE PUBLIC RECORDS. DISCREPANCIES, CONFLICTS IN BOUNDARY LINES. SHORTAGE IN AREA, ENCROACHMENTS, OR ANY OTHER FACTS WHICH A CORRECT SURVEY WOULD DISCLOSE, AND WHICH ARE NOT SHOWN BY THE PUBLIC RECORDS. (Al UNPATENTED WINING CLAIMS; (8) RESERVATIONS OR EXCEPTIONS IN PATENTS OR IN ACTS AUTHORIZING THE ISSUANCE THEREOF; ICI WATER RIGHTS. CLAIMS OR TITLE TO WATER, WHETHER OR NOT THE MATTERS EXCEPTED UNDER (A), (Ell OR (C) ARE SHOWN BY THE PUBLIC RECORDS. Ce I is } a true and e ct C e original, V. 1992 STEWAN T GE 4 OF 4 GUARANTY , ,IARt TITLE ESCROW Ar�y_�'i0�A1NVt�bf1�J 311I1 ,U,!Mjls i0 3014vul Isla 31111 Jo AoIlQJ ;N1 01 J.113„ 10V11'�' S t1 AG (13rinsSV i11.1110VI1OfIUtIV*).1140N0l1voe-)v 000V .6? 1.13111W V SV tlSHSINUnJ SI dtlYi SIHL a O CVLS U PCV? 5//2,SE.I/4,NE 114,SE6 26,XS.S,R.I/W. W Cb �!� TM W V MN MWPAA W PMomm QD1aR1 V M.YI.USiAICi 4r714M.f1Y IM O'Ir.11 i/!.` M• rorvgo�an oiw0vulwe�o �'rr"+w�""sess `"`� 22 �j it ku[r R d As[1 s R art► TRACT s w S Autr 2 R [� y .• rr n r• y w 1, /Y. 21 • r� a lQ rQ '7 rRXr I 1 34 as sr-n = Rs[r.:r i3 O O w V p O �,,.. z2 j 3 I O 19 S O ro m 1 • � x n rt stair ,! I y 2} � , 1 O !8 , O �w• � � I • 1 1 da 4e H -C w ss !r V' V� 1 O i7 O cr) N 5 I [ �y p N Q I U i6 1 �e / 1 b OWN O t ess.c # � CO 1 1 s t / p (Q I AWj Q 1 zT o o 0 1. ...• t 1 ..,..• W 3 28 I O `'a ; IS Z ,OB IS '+ Irrtcc ,.1.• M� Y rw' IfIc .r YL.- 11j ' t I O R Aufr t M, J Riet► S 11 h v c1�M efr !' Fw h RIC NJ-IJ ►.a ti► ! N C // ♦� E t Jk�/ �•NQ 4301 «NQ 4153 NQ 574,, �f ;,1 r r Lr!ti me h A4 RCH 1976 rRACr Na 4/5J MM. /74-/,2,1d NOTE-ASSESSOR'S SLQCK a ASSESSOA'S IUAP b TRACT Na 43O1 MAC 177-11.12 PAKEL NW IDEAS SWK 165 P"C 23 � Q TRAcr Na 5057 M.AI 182-6.7 MOWN W CJ RCLES COWTY OF ORANGE i PARCH AMP r CounciVAgency Meeting Held: G f S 1R to Deferred/Continued to: d-epproved ❑Conditionally Approved ❑ Denied U City Clerk's Signatu Council Meeting Date: June 3, 1996 Department ID Number. ED 96-37 CITY OF HUNTINGTON BEACH 4 REQUEST FOR COUNCILIREDEVELOPMENT AGENCY ACTION SUBMITTED TO: HONORABLE MAYOR/CHAIRMAN AND CITY COUNCIL MEM3ERSIREDEVELOPMENT AGENCY MEMBERS SUBMITTED BY: MICHAEL T. UBERUAGA, City Administrator/Executive Direct {II�"' PREPARED BY: DAVID C. BIGGS, Economic Development Director W SUBJECT: COMMITMENT OF HOME INVESTMENT PARTNERSHIP FUNDS BETI'VEEN THE CITY AND THE REDEVELOPMENT AGENCY Statement of Issue.Funding Source.Recommended Action.AttemaUve Action(s),Analysis,Environmental Status.Attaclunent(s) Statement of Issue: The City must commit $399,200 in HOME funds by June 27, 1996. Staff is working with nonprofit sponsors to acquire or develop affordable housing projects. At this time, there is not a proposal that is sufficiently advanced to warrant a commitment of funds. HUD recognizes a commitment of funds between the City and the Redevelopment Agency as a legitimate commitment, and staff recommends this approach as, a way to preserve the funds. Funding Source: 1994 HOME Investment Partnership Funds Recommended Action: Motion to: Authorize execution by the Mayor and City Cleric and the Executive Director and Agency Clerk of the attached operating agreement between the City and the Redevelopment Agency. This agreement commits a minimum of $399,200 in 1994 HOME Investment Partnership Program funds to the Agency tc provide affordable housing, per HUD regulations at 24 CFR Part 92. Alternative Action(s): Do not approve the operating agreement. f REQUEST FOR COUNCIUREDEVELOPMENT AGENCY ACTION MEETING DATE: DEPARTMENT ID NUMBER: ED 96-37 ArialK�s: For the 1994 federal fiscal year, Huntington Beach received $543,000 in HOME funds. Of these monies, $89,500 were committed to the Koledo Lane acquisition project, and $54,300 were automatically committed to program administration. A balance of $399,200 are left to commit by the June 27, 1996 deadline. Staff received confirmation from HUD (see Attachment No. Two) that a commitment of funds behveen the City and the Redevelopment Agency is considered a valid commitment. The Agency may choose to commit the funds to a third party developer (such as a CHDO); or it may decide to directly contribute to a project. Either way, an affordable housing agreement must be completed before any HOME funds can be expended. Environmental Status: Not applicable. : List attachment(s) below. J�C!ty Clerk's 111 = No. Description Start Numbering 1. Operating Agreement a 2. Letter from HUD dated May 10, 1996 3. HOME Program Summary MTU:DCB:GAB:gab COMITRAA-DOC -2- 05/22196 1:30 PM CITY OF HUNTINGTON BEACH CO,XMTMENT OF FUNDS AGREEMENT BETWEEN THE CITY OF HUNTINGTON BEACH AND THE HUNTINGTON BEACH REDEVELOPNIENT AGENCY This Commitment of Funds Agreement(the"Agreement"), is made this day of 1996, by and between the City of Huntington Beach, a municipal corporation ("City"), and the Redevelopment Agency of the City of Huntington Beach , a body politic of the State of California, organized and existing under the Community Redevelopment Law of the State of California("Agency"). RECITALS A. City wishes to expand the supply of decent, safe, sanitary and affordable housing, with primary attention to rental housing, for very-law income and low income residents in the City of Huntington Beach. B. City has received HOME Investment Partnership Program funds in the amount of Three Hundred Ninety-nine Thousand Two Hundred Dollars($399,200.00)from the United States Department of Housing and Urban Development pursuant to the National Affordable Housing Act of 1990 for the purpose of expanding the supply of decent, safe, sanitary and affordable housing for very-low and low income persons and families (hereinafter, the"Funds") C. Agency proposes to acquire and rehabilitate certain real property and/or improvements located in the City of Huntington Beach, California(as more particularly described in Exhibit A and hereinafter referred to as the"Property")and carry out on the Property eligible activities permitted under the HOME Regulations to provide housing affordable to low-income and very-low income households as defined in this Agreement (hereinafter referred to as the "Project"). D. Agency wishes to receive from City, and City wishes to make available to Agency, the Funds to support development of the Project. NONNNI, THEREFORE, IN CONSIDERATION of the mutual agreements, obligations, and representations, and in further consideration for the provision of HOMEE funds, RDA and City hereby agree as follows: 1 UsTMAgree Rcs%fun& RLS 96-329 S•22/9G-91 r ARTICLE 1. DEFINITIONS The following terms have the meanings and content set forth in this section wherever used in this Agreement. 1.1 "Eligible Activities" means permitted use of the Funds pursuant to the HONE Regulations. 1.2 "Funds"means the funds provided to Agency by City pursuant to this Agreement. 1.3 "HOME Regulations" means all requirements imposed on projects assisted under the Home Investment Partnership Program as contained in 42 U.S.C. Sections 12701, et seq., and Part 92 of Title 24 of the Code of Federal Regulations and other implementing rules and regulations. 1.4 "HUD" means the United States Department of Housing and Urban Development. 1.5 "Low Income Household" means a household whose annual income does not exceed eighty percent (801,40) of the median income for Orange County as determined by HUD with adjustments for household size. 1.6 "Project" is the acquisition of the Property and the construction or rehabilitation of certain improvements thereon or the administration or implementation of any other eligible activity to provide housing affordable to persons or families of very low-income and low-income according to the terms of this Agreement_ 1.7 "Regulatory Agreement" means the agreement executed by Agency or an eligible third party and the City in a form satisfactory to City and retarded against the Property prior to or contemporaneously with the payment of the Funds which regulates, among other things,the operation, leasing, tenant selection, income certification, affordability restrictions, continuing occupancy requirements and maximum rental charges of the housing. 1.8 "Very Low Income Household"means a household whose annual income does not exceed fifty percent(501/o) of the median income for Orange County as determined by HUD with adjustments for household size. ARTICLE 2. USE OF FUNDS 2.1 COINWITMENT OF FUNDS. Pursuant to this Agreement, Agency shall use the Funds for the Project. The Agency shall expend the Funds by no later than June 27, 1999. 2.2 AMOUNT OF HOME FUNDS. On and subject to the terms and conditions of this Agreement, City agrees to provide Agency and Agency agrees to accept 11011Y E Funds in 2 Sl%PMAgrec:Rcs.runds RLS 96.329 5'22.'96•s1 an amount not less than Three Hundred Ninety-nine Thousand Two Hundred and no/100 Dollars (S399,200.00),which shall be used for the Project. 2.3 REGULATORY AGREEMENT. As a condition of the provision of the Funds, Agency shall execute (or cause to be executed by an assignee), among other things, a regulatory agreement which shall be recorded against any property acquired with the Funds. The regulatory agreement is to secure City's continuing interest in the affordability and habitability of the housing acquired through this Agreement and the regulatory agreement. ARTICLE 3. EMPLOYMENT 3.1 PREVAILING WAGES. All proj:cts for new construction or rehabilitation of affordable housing with 12 or more units assisted with HONE Funds shall comply with HUD requirements pertaining to such contracts and the applicable requirements of the regulations of the Department of Labor governing the payment of wages and the ratio of apprentices and trainees to journeymen. However, nothing in this section is intended to relieve the Agency or any contractor/subcontractor of any obligation for payment of higher rates if required by State or local law. ARTICLE 4. GENERAL PROVISION'S 4.1 NOTICES, DEMANDS AND COMMUNICATIONS. Formal notices, demands and communications between Agency and City shall be sufficiently given ana shall not be deemed given unless dispatched by registered or certified mail, postage prepaid, return receipt requested, or delivered personally, to the principal offices of Agency and City as follows: CITY: City of Huntington Beach Department of Economic Development 2000 Main Street Huntington Beach, CA 92648 Attn: City Administrator AGENCY: Redevelopment Agency of the City of Huntik ton Beach 2000 Main Street Huntington Beach, CA 92648 Attn: Executive Director 4.2 INTEGRATION. This Agreement constitutes the entire agreement of the parties and supersedes any all prior negotiations. 4.3 AMENDMENTS AND MODIFICATIONS. Any amendments or modifications to this Agreement must be in writing, and shall be made only if executed by both!HC and City. 3 SF'a: MAgice:Res%funds RLS 96-329 3.22 96-I'1 e IN WITNESS WIiEREOF, the parties hereby have executed this Agreement as of the date first above written. AGENCY: CITY: REDEVELOPMENT AGENCY OF CITY OF HUNTIri'GTON BEACH, THE CITY OF HUNTINGTON BEACH a municipal corporation of the State of California �---R ,�Mw_-"�s— Mayor i'17C�JRE'cr T. L�B�rA�A (print name) ATTEST: Its: Executive Director City Clerk ATTEST: APPROVED AS TO FORM: Agency Clerk �F•'City Attorney REVIEWED AND APPROVED: INITIATED AND APPROVED: A —City Aomini trat Director of Economic Development 4 SFs.r'CD:Agrce:Rcs% un& RLS 9b-329 5 229G-d1 f Exhibit "A" Property HOME funds awarded under this Agreement will only be used for the acquisition and rehabilitation of multifamily rental properties. The order of priority for the targeting of these funds to specific areas is as follows: Z. Redevelopment Project Areas • Oakview • Main-Pier • Talbert-Beach 2. CDBG and HOINIE neighborhood enhancement areas (not listed in priority order) • Oakview • Amberleaf Circle • Florida-Utica • Beach-Garfield • Newland ' • Washington • Liberty 3. Citywide S Fs:PMAgec-ReMunds RL.S 96-329 5 22 96-61 r U.S. Department of Housing and Urban Development Pacific/Hawaii ` I Los Angeles Area Office 1615 West Otyapic Boulevard Los Angeles, California 90015-3801 May 10, 1996 Greg Brown, Development Specialist/ HOME Coordinator City of Huntington Beach 2000 Main Street Huntington Beach, CA 92648 Dear Mr. Brown: SUBJECT: HOME Program Commitment of HOME Funds from the City to the Redevelopment Agency This is in response to your letter dated May 6, 1996, regarding commitment of HOME funds by the deadline. You asked whether or not a commitment of HOME funds to the City's Redevelopment Agency constitutes a valid commitment. In addition, if this type of arrangement is considered valid, can the Redevelopment Agency loan the funds to a third party subrecipient or a CHDO? As you discussed with Maryann Soos of this office, the City can enter into a legally binding agreement with the Redevelopment Agency to produce affordable housing as referenced under 24 CFR 92.2, Definitions -- Commitment. The Redevelopment Agency, as a subrecipient, can then enter into a separate agreement with•.a third party or a CHDO to produce affordable housing. If you have any questions, please contact Maryann E. Soos, Community Planning and Development Representative, at (213) 251-7268. Very sincerely yours, r Ma . de-Saman'ego P gram Manager, 9DDM4 V EI . � '~ C6 APR 1 - ; A64PCity of Huntington Beach 2000 MAIN STREET CALIF0RNIA92648 DEPARTMENT OF ECONOMIC DEVELOPMENT Office of the Director 536-5582 Housing 536-5542 Redevelopment 536-5582 Fax (714)375-5087 May 6, 1996 VIA FACSIMILE Ms. Mary Ann Soos Community Planning and Development Representative U.S. Department of Housing and Urban Development 1615 West Olympic Boulevard Los Angeles, CA Subject: Commitment of HOME Funds from the City to the Redevelopment Agency Dear Mary Ann: a Under the current HOME regulations governing the commitment of funds prior to the commitment deadline, would a commitment of HOME funds from the city to the city's redevelopment agency constitute a valid commitment?. This commitment would be made via an operating agreement that spells out the terms of the commitment and governs any subsequent expenditures. Secondly, if this type of arrangement is considered valid, could the redevelopment agency loan the funds to a third party subrecipient, or a CHDO?; or would the redevelopment agency be solely responsible for the expenditure of the H0ME funds on a qualified project? Because the commitment deadline for 1994 funds is looming, I would appreciate a response from you as soon as possible. If you need additional clarification, please call me at (714) 960-8831. Thank you, Maryanne, for your kind assistance!. S• cerely, Gre o m Deve ent Specialist/HOME Coordinator GAB:gb ., City of Huntington Beach HOME Investment Partnership Program City of Huntington Beach 5l22/96 1 The HOME Program s A Federal Housing Block Grant o Created by the National Affordable Housing Act of 1990 ("NAHX) • Must be used to create or preserve housing units for very low income people (Below 60% of County Median Income) City of Huntington Beach 5/22/96 2 The HOME Program • Huntington Beach has participated in the program since the 1992 federal fiscal year, the first year funding became available g '1992 $8811000 • 1993 $5841000 e 1994 $543,000 • 1995 $583,000 City of Huntington Beach 5/22/96 3 Eligible HOME Activities e There are five categories of expenditures: — Acquisition . of existing housing o Vacant land — Rehabilitation — New Construction — Tenant-Based Rental Assistance — First-Time Homebuyer Assistance City of Huntington Beach 5/22196 4 Ineligible Uses of HOME • HOME funds cannot be used for: )) Modernizing public housing )> Matching funds for other federal programs >> Public facilities >> Public improvements >) Infrastructure projects City of Huntington Beach 5/22/96 5 HOME Administration • 10% of the grant can be used for program administration 0 15% of the funds must be given to a qualified CHDO (Community Housing Development Organization), a special housing nonprofit e Beginning with the 1993 fiscal year, HOME funds must be matched at 25% City of Huntington Beach 5/22/96 6 Allocation of 'HOME Funds 1992-95 I,e•. .,e^'- }•. ;•i.'r..•' .^;err r. r r1� i '}•, j � $2599100 is ;.• '',;:,..::;, D Admin ® CHDO 0 Projects $388,650 l,• .; City of Huntington Beach 5/22/96 7 How HB Has Used HOME • To date, 1-113 has used HOM ' funds exclusively to assist CHDO's with the acquisition & rehab of multifamily housing in the Oakview enhancement area • CHDO's: » Orange County Community Housing Corp Shelter for the Homeless Jamboree Housing City of Huntington Beach 5/22/96 8 HOME Projects in Huntington Beach Project Date Units Cost 17372 Keelson Ln. Feb `94 4 $225,000 7812 Barton Dr. June `94 . 4 $320,000 17382 Keelson Ln. Aug `94 4 $247,900 17361 Koledo Ln. Apr `95 5 $2591000 17371 Koledo Ln. Apr `95 5 $2591000 City of Huntington Beach 5/22196 9 HOME Acquisition & Rehab o Average Per Unit Cost Acquisition $54.1000 • Average Per Unit Cost Rehab $15,w000 City of Huntington Beach 5l22/96 10 HOME Program Accomplishments • Results: 22 Units preserved for very low income individuals and families Income restrictions in place for 30 to 59 years — HOME requires between 5 & 20 Years Affordability City of Huntington Beach 5/22/96 11