HomeMy WebLinkAboutVPM Bridges Apartments - Formerly The Bridges America Foundation, L.P. - 2000-10-16 UPLI
CITY CLERIC RIGI,ti
Council/Agency Meeting Held:
Deferred/Continued to:
'XA proved ❑ Conditionally Ap roved ❑ Denied bR City Clerk'��Signature
Council Meeting Date: March 18, 2002 Department ID Number: PLW-OZ
CITY OF HUNTINGTON BEACH ==7
REQUEST FOR ACTION
SUBMITTED TO: HONORABLE MAYOR AND CITY COUNCIL MEMBERS _-
SUBMITTED BY: RAY SILVER, City Administrator 024P
PREPARED BY: HOWARD ZELEFSKY, Director of Planning
SUBJECT: APPROVE AGREEMENTS CONTAINING COVENANTS BETWEEN
THE CITY OF HUNTINGTON BEACH AND VPM BRIDGES
APARTMENTS, L.P. AND BETWEEN'THE CITY OF HUNTINGTON
BEACH AND BRIDGES AMERICA SHER, L.P.
Statement of Issue,Funding Source,Recommended Action,Alternative Action(s),Analysis,Environmental Status,Attachment(s)
Statement of Issue:
Transmitted for your consideration are two affordable housing agreements that restrict 77
apartment units at Nichols Street and 33 apartment units at Sher/Parkside Lane to low-
income households fora period of thirty years. These agreements were previously approved
by the City Council but have been modified to reflect a change in units and ownership.
Funding Source: Not applicable.
Recommended Action:
Motion to:
1. "Approve the Agreement Containing Covenants Affecting Real Property By and Between the
City of Huntington Beach and VPM Bridges Apartments, L.P. and authorize the Mayor and
City Clerk to sign and execute and the City Clerk to record (ATTACHMENT NO. 1); and"
2. "Approve the Agreement Containing Covenants Affecting Real Property By and Between the
City of Huntington Beach and Bridges America Sher, L.P. and authorize the Mayor.and City
Clerk to,sign and execute and the City Clerk to record (ATTACHMENT NO. 2).°
*REQUEST FOR ACTION
MEETING DATE: March 18, 2002 DEPARTMENT ID NUMBER: PL02-07
Alternative Action(s):
The City Council may make the following alternative motion:
"Continue the Agreements Containing Covenants Affecting Real Property By and Between the
City of Huntington Beach and VPM Bridges Apartments, L.P. and.Bridges America Sher, L.P.
and direct staff accordingly."
Analysis:
A. PROJECT PROPOSAL:
Applicant: Bridges America.Sher, L.P., 18837 Brookhurst St., Ste. 303, Fountain Valley,
CA 92708 and VPM Bridges Apartments, L.P., c/o Village Investments, 2400
Main St., Ste. 201, Irvine, CA 92614
Location: The covenanted properties are located at 16884 Nichols Street and 16122
Sher Lane/16161 Parkside Lane.
'The affordable housing agreements restrict 77 apartment units at-Nichols Street and 33
apartment units at_Sh.er/P_arkside_Lane to low-income households for a period of thirty years.
The Nichols Street project was previously owned by Bridges America Foundation, L.P. and
has recently been acquired by VPM Bridges Apartments, L.P. The Sher/Parkside Lane
project is owned and managed by Bridges America Sher, L.P.
B. BACKGROUND
In 1995 Bridges America began establishing an affordable housing "bank" by which the City's
affordable housing .requirement could be met. Developers would pay a per unit fee to
Bridges America which subsequently would restrict the associated units to low income
households for a thirty year period. In October 2000, the City Council approved an
agreement for 80 units at the Nichols Street project, the first "bank" established. On April 2,
2001, the City Council approved an affordable housing agreement for. 33 units at the
Sher/Parkside Lane property.
As part of the Economic Development Department's recent affordable housing monitoring
effort, it was determined that three of the units at Nichols Street were previously encumbered
as affordable .under the City's Community Development Block Grant program (Attachment
No. 3). In order to rectify this situation, it was determined that.the previously recorded .
agreements for the subject properties should be changed.to reallocate three of the Nichols
Street units to Sher/Parkside Lane. At approximately the same time, the City was notified
that the Nichols Street project was being sold to VPM Bridges Apartments, L.P.
PL02-07 -2- 2/25/2002 2:15 PM
• FOR ACTION
REQUEST
MEETING DATE: March 18, 2002 DEPARTMENT ID NUMBER: PL02-07
C. STAFF ANALYSIS AND RECOMMENDATION:
The Nichols Street agreement (Attachment No. 1) has been modified to reflect the reduction
in units and the new ownership. The three units encumbered by the City's CDBG program
are covered by a separate instrument, which does not require revision. The exhibit
identifying encumbered units for the Sher/Parkside agreement (Attachment No. 2) has been
updated to reflect the three units transferred from the Nichols project, as well as two
additional units that were encumbered after the original agreement was approved. Both
agreements have been reviewed and signed by all parties and the City Attorney's office.
Staff recommends that the City Council approve the agreements.
Environmental Status:
The subject request is exempt pursuant to the California Environmental Quality Act.
AttachmenNs):
City Clerk's
Page Number No. Description
1. Affordable Housing Agreement with VPM Brid es A artments, L.P:
2. Affordable HousingAgreement with Bridges America Sher, L.P. Sty lid -IDS
3. Memorandum from David Biggs to Howard Zelefsky, dated December
3, 2001
RCA Author: MBB
PL02-07 -3- 2/25/2002 2:15 PM
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Recorded in Official Records, County of Orange
Darlene Bloom, Interim Clerk Recorder
RECORDING REQUESTED BY ������������������������� ���������������111111111111111NO FEE
AND WHEN RECORDED MAIL TO: 20020316059 08:48am 04116102
100 73 Al2 12
City of Huntington Beach 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
2000 Main Street
Huntington Beach, CA 92648
Attn: City Clerk
(Space above for recorder) c
This Agreement is recorded at the
request and for the benefit of the City
of Huntington Beach and is exempt
from the payment of fees pursuant to
Government Code Section 6103.
AGREEMENT CONTAINING COVENANTS AFFECTING REAL PROPERTY
BY AND BETWEEN THE CITY OF HUNTINGTON BEACH
AND VPM BRIDGES APARTMENTS, L.P.
THIS AGREEMENT CONTAINING COVENANTS AFFECTING REAL PROPERTY
(the "Agreement") is entered into this \18th day of March , 200 2 ,by and between
the CITY OF HUNTINGTON BEACH, a municipal corporation ("City"), and VPM BRIDGES
_APARTMENTS, L.P., a California limited partnership ("Owner"), and supersedes that certain
agreement recorded as Instrument No. 20000594352, which was recorded on November 2, 2000,
concerning the property described hereinbelow.
RECITALS:
A. Owner is fee owner of record of that certain real property commonly known as
16884 Nichols Street (the "Site") located in the City of Huntington Beach, County of Orange,
State of California legally described in the attached Exhibit "A." There are currently twenty(20)
4-plexes with a total of eighty(80) multi-family apartment units located on the Site.
B. On November 2, 2000,City.and Bridges America Foundation, L.P., recorded
against the Site that certain Agreement Containing Covenants Affecting Real Property(the
"Original Agreement")that was recorded as Instrument No. 2,0000594352 in the official Records
of the Orange County Recorder's Office.. The Original Agreement obligated Owner to provide
all eighty(80) units on the Site as affordable dwelling units (the-."Affordable Units") to satisfy
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08 JAN 2002
the Affordable Housing requirements of various development projects as referred to in the
Original Agreement.
C. Since the recordation of.the Original Covenant, the Site has been transferred from
Bridges America Foundation L.P. to Owner, and City has discovered that three (3) of the
Affordable Units on the Site had been previously restricted to Low Income families under City's
CDBG program in 1997; and
D. City and Owner have set forth the individual development projects and number of
affordable housing units required for each project on the matrix attached hereto as Exhibit `B"
and incorporated by this referenced as though fully set forth herein; and
E. The City and the Owner wish to enter into a formal Agreement to clarify the
affordable housing obligations set forth in the Original Covenant to provide for the long term
affordability of the Affordable units on the Site, and the additional affordable units described
hereinabove,
NOW, THEREFORE, BASED UPON THE FOREGOING RECITALS AND FOR
GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND SUFFICIENCY OF
WHICH IS ACKNOWLEDGED BY BOTH PARTIES, CITY AND OWNER AGREE AS
FOLOWS:
I. AFFORDABLE HOUSING
(A) Number of Units. Owner agrees to make available, restrict occupancy
to, and lease seventy-seven (77) Affordable Units on the Site to "Lower Income Households" at
an "Affordable Rent" for the duration of the "Affordability Period" (as those terms are defined
hereinbelow). Nothing in this Agreement shall restrict Owner's right to select which of the
seventy-seven (77) rental housing units on the Site shall be the Affordable Units and Owner may
at is option change the location of the Affordable Units on the Site from time to time, provided
that a minimum of seventy-seven (77) rental housing units shall be restricted as Affordable Units
during the entire Affordability Period.
As used in this Agreement, the term "Lower Income Household" shall mean
persons and families whose income does not exceed eighty percent (80%) of Orange County
median income, adjusted for family size, as determined by the United States Department of
Housing and Urban Development, as set forth in Health and Safety Code Section 50079.5.
As used in this Agreement, the term "Affordable Rent" shall have the meaning set
forth in Section I(D) hereinbelow.
As used in this Agreement, the term "Tenant" shall mean any person who rents or
leases any portion of the Site or any person who is not a fee or equitable owner of any portion of
the Site who uses the Site as his or her principal residence. For purposes of this Agreement,
principal residence will be determined in the same manner as principal residence is determined
for state.residency under California Vehicle Code Section 516.
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08 JAN 2002
(B) Duration of Affordability Requirements. The Affordable Units shall be
subject to the requirements of this Agreement for thirty(30) years from the date the final
Affordable Unit applicable to such development has been rented to a Lower Income Household.
City acknowledges that the residential dwelling units on the Site are occupied as of the date this
Agreement and that the requirements of this Agreement will be enforced by Owner as units are
vacated and become available for rental to eligible households in the ordinary course of business.
The duration of this requirement shall be known as the "Affordability Period."
(C) Income of Tenant. After the lease of any Affordable Unit to a Tenant,
Owner shall submit to the Planning Director of the City a completed income computation and
certification form, in such form as is generally used-by City in administering its affordable
housing program from time to time. Owner shall certify that to the best of its knowledge each
Tenant of an Affordable Unit is a Lower Income Household and meets the eligibility
requirements established for the particular Affordable Unit occupied by such household. Owner
shall obtain an income certification from each Tenant of an Affordable Unit and shall certify
that, to the best of Owner's knowledge, the income of the tenant is truthfully set forth in the
income certification form. Owner shall verify the income certification of the Tenant in one or
more of the following methods as specifically requested by City:
(1) Obtain two (2)paycheck stubs from the tenant's two (2) most
recent pay periods.
(2) Obtain a true copy of an income tax return from the Tenant for the
most recent tax year in which a return was filed.
(3) Obtain an income verification certification from the Social
Security Administration and/or the California Department of Social Services if the Tenant
receives assistance from such agencies.
(4) Obtain an income verification certification from the Social
Security Administration and/or.the California Department of Social Services if the Tenant
receives assistance from such agencies.
(5) obtain an alternate form of income verification reasonably
requested by City, if none of the above forms of verification is available to Owner.
If, after renting an Affordable Unit to an eligible household, the household's
income increases above the income level permitted for that unit, the household shall continue to
be permitted to reside in such Affordable Unit. Subsequently, however, when the next
residential rental unit on the Site becomes vacant and available for rent, the vacant unit shall
become an Affordable Unit subject to the restrictions of this Agreement (and subject to Owner's
retained discretion to change the location of Affordable Units from time to time, as provided in
Section I(A) herein.
3
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RLS 2001-0917
08 JAN 2002
(D) Determination of Affordable Rent for the Affordable Units. The
maximum monthly rental payment ("Affordable Rent") amount for the Affordable Units required
to be leased to Lower Income Households shall be established at thirty-five percent (35%) times
seventy-nine percent (79%) of the monthly area median income for a household of four persons.
The Affordable Rent amount for the Affordable Units shall be adjusted annually
by the formula set forth above upon the publication of revised Orange County median income
figures by the United States Department of Housing and Urban Development.
OWNER UNDERSTANDS AND KNOWINGLY AGREES THAT THE
MAXIMUM RENTAL PAYMENTS TO BE ESTABLISHED BY THIS FORMULA ARE NOT
NECESSARILY EQUAL TO THE FAIR MARKET RENT FOR THE AFFORDABLE UNITS,
AND MAY BE ESTABLISHED AT A LEVEL SUBSTANTIALLY BELOW THE FAIR
MARKET RENT LEVELS.
OWNER HEREBY AGREES TO RESTRICT THE AFFORDABLE UNITS
ACCORDINGLY.
S�
Owner's initials
(E) Annual Report. Within sixty(60) days after the end of each
calendar year during the Affordability Period,Owner shall submit to City a report verifying
Owner's compliance with the provisions of Section I(A)-(D) of this Agreement. Owner.'s final
annual report shall be submitted to City within sixty(60) days after the end of the Affordability
Period. Each annual report shall identify the number and location of the Affordable Units for the
applicable reporting period, the identity of each Tenant occupying an Affordable Unit during a
day portion of such period, the income and family size of each such Tenant, the Affordable Rent
for each of the Affordable Units, and the actual contract rent actually charged. If City prescribes
a particular form to be utilized by Owner in preparing the annual report, Owner shall utilize said
form,provided that it complies substantially with the foregoing requirements.
II. NON-DISCRIMINATION.
Owner, on behalf of itself and its successors, assigns, and each successor in
interest to the Site or any part thereof, hereby further covenants and agrees during the
Affordability Period:
(A) Not to discriminate upon the basis of sex, marital status, race, color, creed,
religion, national origin, or ancestry in the sale, lease, sublease, transfer or rental, or in the use,
occupancy, tenure, or enjoyment of any of the Affordable Units on the Site. Each and every
lease and contract entered into with respect to any of the Affordable Units on the Site during the
Affordability Period shall contain or be subject to substantially the following nondiscrimination .
or nonsegregation clauses:
4
PDA:2002 Agreements:VPM Bridges Apartments
RLS 2001-0917
O8 JAN 2002
In leases: "The lessee herein covenants by and for itself, its successors and
assigns, and all persons claiming under or through them, and this lese is made and accepted upon
and subject to the following conditions:
That there shall be no discrimination against or segregation of any person or
group of persons on account of sex, marital status, race, color, creed, religion, national origin, or
ancestry, in the leasing, renting, subleasing, transferring, use, occupancy, tenure, or enjoyment of
the land herein leased, nor shall the lessee itself, or any other person claiming under or through
it, establish or permit such practices of discrimination or segregation with reference to the
selection, location, number, use, or occupancy of tenants, lessees, sublessees, subtenants, or
vendees in the land herein leased."
In contracts: "There shall be no discrimination against or segregation of any
persons or group of persons on account of sex, mari.tal status, rare, color, creed, religion, national
origin, or ancestry in the sale, lease, rental, sublease, transfer, use, occupancy, tenure, or
enjoyment of the land, nor shall the transferee itself or any person claiming under or through it,
establish or permit any such practice or practices of discrimination or segregation with reference
to the selection, location, number, use, or occupancy of tenants, lessees, subtenants, sublessees,
or vendees of the land. "
III. USE RESTRICTIONS
During the Affordability Period, Owner shall be required to take all reasonable
steps necessary to ensure that each Tenant of an Affordable Unit and all assignees and
transferees of such Tenant have knowledge of all terms and conditions of this Agreement by
including in each and every lease and rental agreement a clause which identifies this Agreement
by reference and makes this Agreement available for review by each Tenant in the Site
Manager's office. In addition, during the Affordability Period, each lease for any of the
Affordable Units on the Site shall contain provisions that the Affordable Unit shall be occupied,
used, and maintained as follows:
(A) the dwelling unit shall be used only for private dwelling purposes, with
appurtenant facilities, and for no other purposes;
(B) the Tenant shall not permit or suffer anything to be done or kept upon the
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 reasonable noises or otherwise, nor shall any Tenant commit or
permit any nuisance on the premises or fail to keep the premises free of rubbish, clippings, and
trash or commit or suffer any illegal act to be committed thereon;,
(C) the Tenant shall comply with all of the lawful requirements of all
governmental authorities with respect to the premises;
5
PDA:2002 Agreements:VPM Bridges Apartments
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08 JAN 2002
(D) 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 City;
(E) no person shall be permitted to occupy the premises for transient or hotel
purposes; and
(F) the Tenant shall comply in all respects with this Agreement and any
failure by the Tenant to comply with the terms of this Agreement shall be a default under the
Tenant's lease.
IV. APPLICABLE LAW
(A) If any provision of this Agreement or portion thereof, or the application to
any person or circumstances, shall to any extent be held invalid, inoperative, or unenforceable,
the remainder of this Agreement, or the application of such provision or portion thereof to any
other persons or circumstances, shall not be affected thereby; it shall not be deemed that any
such invalid provision affects the consideration for this Agreement; and each provision of this
Agreement shall be valid and enforceable to the fullest extent permitted by law.
(B) This Agreement shall be construed in accordance with the laws of the State
of California.
V. MISCELLANEOUS
(A) Satisfaction of Affordable Housing Obligations of Development Projects
Referenced Herein. By its approval and execution of this Agreement, City acknowledges that
upon the recordation of this Agreement against the Site, Owner shall have assumed the
obligations of the development projects listed on Exhibit `B"to provide affordable housing, that
the owners/developers of those other projects thereafter shall-be released from the obligations to
provide affordable housing as stated in the conditions of approval for such projects, and that
thereafter City shall look solely and exclusively to Owner and the Site for satisfaction of such
affordable housing obligations. The owners/developers of said projects shall be third party
beneficiaries of this Agreement to the extent necessary to enforce their respective interests in this
Section V(A), and this Agreement shall not be modified, amended, or terminated in any manner
which affects the said projects or the respective interests of the owners/developers thereof,
without the prior written consent of the affected owner/developer(s), which consent may be
withheld in such owner/developer's sole and absolute discretion.
(B) Binding on Successors and Assigns. The covenants and agreements established
in this Agreement shall, without regard to technical classification and designation, be binding on
Owner and any successor to Owner's right, title, and interest in and to all or any portion of the
Site, for the benefit of and in favor of the City of Huntington Beach. All the covenants contained
in this Agreement shall remain in effect for the Affordability Period, and shall automatically
terminate and be of no further force or effect after such time. Upon expiration of the
6
PDA:2002 Agreements:VPM Bridges Apartments
RLS 2001-0917
08 JAN 2002
Affordability Period, City agrees to cooperate with Owner, at no cost to City, in removing this
Agreement of record from the Site.
(C) Subordination to Trust Deeds. Notwithstanding any other provision in this
Agreement to the contrary, the covenants and agreements established in this Agreement at all
.times shall be junior and subordinate to the lien of any mortgage or deed of trust recorded by or
on behalf of a lender to secure a loan for the acquisition or improvement of the Site, including
without limitation any deed of trust recorded concurrently herewith. City agrees, at no expense
to City, to.execute such documents as may be reasonably requested by Owner, any successor or
assign to owner's right, title, and interest in and to all or any portion of the Site, or any lender of
any such person subordinating City's rights and interest under this Agreement to the lien of any
trust deed recorded or to be recorded by a lender securing a loan for the acquisition or
improvement of the Site. Owner, Owner's successor or assign, or the benefited lender shall be
responsible for preparing the document(s) creating such subordination of City's interest.
IN WITNESS WHEREOF, City and Owner have executed this Agreement containing
Covenants Affecting Real Property to be effective as of the date first written above.
CITY OF HUNTINGTON BEACH,
a municipal corporation
Mayor
ATTEST: APPROVED AS TO FORM:
City Clerk YfTwt
ttorney \ �y
REVIEWED.AND.APPROVED: D AND APPROVED:
, • -
City AdniTnistrator Wctor of P anning
VPM BRIDGES APARTME TS, L.P.,
a Cal ifo m led partner ip
By:
Its: (�,t,1n,,,,�ra,,/ a✓--p1�,�/'
By:
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PDA:2002 Agreements:VPM Bridges Apartments
RLS 2001-0917
08 JAN 2002
CALIFORNIA ALL-PURPOS ACKNOWLEDGMENT •
State of
County of
On 2Z o aZbefore me,
Date r Name and Title of Officer(e.g.,"Jane Doe,Notffily Public")
personally appeared �L` 66%t°_,, U /
Name(s)of Signers)
❑personally known to me—OR proved to me on the basis of satisfactory evidence to be the personk4
whose names) is/ace subscribed to the within instrument
and acknowledged to me that he/she/#*y executed the
same in hris/herAheir authorized capacityEies),and that by
iris/her/their signature.-)on the instrument the person{4
VIRGINIA R. MELTON or the entity upon behalf of which the person(s�-acted,
Comftsion 1i 1290M executed the instrument.
OWWM Nofty Public-Coli w&
Q=V8 Coin IF WITNESS my hand and official seal.
MlrCWM60wjan 112M5
Signature of Notary Public
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 of this form to another document.
Description of Attached Document ,o
Title or Type of Document: d V-- be T ..?
PL
Document Date: O Z 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 _
El Guardian or Conservator ❑ Guardian or Conservator
❑ Other: Top of thumb here ❑ Other: Top of thumb here
Signer Is Representing: Signer Is Representing:
0 1995 National Notary Association-8236 Remmet Ave.,P.O.Box 7184-Canoga Park,CA 91309.7184 Prod.No.5907 Reorder:Call Toll-Free 1.800-876-6827
CALIFORNIA ALL-PURPO ACKNOWLEDGMENT •
State of
County of d,61_ 7
OnI/A�fih 077.o�?6`02_ before me,
Date Name and Title of Officer(e.g.,"Jane Doe,Nfolary Public")
personally appeared !�!/I
Name(s)of Signer(s)
"personally known to me-OR-❑proved to me on the basis of satisfactory evidence to be the person(&)-
whose name(a) is/are subscribed to the within instrument
and acknowledged to me that He/she/they executed the
same in-ht/her/their authorized capacity(oej, and that by
VIRGINIA R. MELTON -hiss/her/t�Heir signature(s}on the instrument the person(4
Ccx=1 ton 1290573 or the entity upon behalf of which the person(sj-acted,
NotQy pwft_Cantamtb executed the instrument.
Orange County
Ml/OormE0lesJm1&2M6 WITNESS my hand and official seal.
Signature of No ary Public
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 of this form to another document.
Description of Attachecl Document .
Title or Type of Document: v e.-I-q & of; oems . "li,
Document Date: 3 Number of Pages:
Signer(s) Other Than Named Above.-_ee�-
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
M.
❑ Guardian or Conservator ❑ Guardian or Conservator
❑ Other: Top of thumb here ❑ Other: Top of thumb here
Signer Is Representing: Signer Is Representing:
0 1995 National Notary Association•8236 Remmet Ave.,P.O.Box 7184•Canoga Park,CA 91309-7184 Prod.No.5907 Reorder:Call Toll-Free 1-800-876-6827
CALIFORNIA ALL.PURPA ACKNOWLEDGMENT •
State of California
County of Orange
On January 30, 2002 before me, Carole J. Norris, Notary Public
Date Name and Title of Officer(e.g.,"Jane Doe,Notary Public")
personally appeared Scott J. Barker and Philip H. McNamee
Name(s)of Signer(s)
C�personally known to me—OR—❑proved to me on the basis of satisfactory evidence to be the person(s)
whose name(s)+e/are subscribed to the within instrument
and acknowledged to me that hefsWthey executed the
same in hisfhrerftheir authorized capacity(ies),and that by
hie/#er,/their signature(s)on the instrument the person(s),
CAFcOIEJ.NORRIS or the entity upon behalf of which the person(s) acted,
y� &• Commission# 1271591 executed the instrument.
z ti�i Notary Pubiic-Califorda n, Orange County WITNESS my hand and official seal.
My Comm. ,;eb?6,2003
Signatur of Notary Public
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 of this form to another document.
Description of Attached Document
Title or Type of Document: Agreement Containing Covenents Affecting Real
Property by an--d Between the City ot Huntington Beach and vPM rid s
Document Date: January 28 , 2002 Number of Pages: 7
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
M.
❑ Guardian or Conservator ❑ Guardian or Conservator
❑ Other: Top of thumb here ❑ Other: Top of thumb here
Signer Is Representing: Signer Is Representing:
01994 National Notary Association•8236 Remmet Ave.,P.O.Box 7184•Canoga Park,CA 91309-7184 Prod.No.5907 Reorder:Call Toll-Free 1-800-876-6827
EXHIBIT "A"
LEGAL DESCRIPTION OF THE SITE
THAT PORTION OF THE WEST A0 ACRES OF THE SOUTH HALF OF THE SOUTH
HALF OF THE SOUTHEAST QUARTER OF SECTION 23, TOWNSHIP 5 SOUTH, RANGE
11 WEST, IN THE RANCHO LA BOLSA CHICA, AS SHOWN ON A MAP RECORDED IN
BOOK 51, PAGE 13, OF MISCELLANEOUS MAPS, RECORDS OF SAID COUNTY,
DESCRIBED AS FOLLOWS-
BEGINNING AT THE NORTHEAST CORNER OF SAID WEST 10 ACRES; THENCE
SOUTH 340.00 FEET; THENCE WEST 640.00 FEET PARALLEL WITH THE NORTH LINE
OF SAID WEST 10 ACRES TO THE EAST LINE OF THE RIGHT-OF-WAY OF THE
SOUTHERN PACIFIC RAILWAY; THENCE NORTH 340.00 FEET ALONG SAID EAST
LINE TO THE NORTH LINE OF SAID WEST 10 ACRES; THENCE EAST 640.00 FEET TO
THE POINT OF BEGINNING.
EXCEPTING THEREFROM THAT PORTION THEREOF INCLUDED WITHIN THE
WESTERLY 570.00 FEET OF THE SOUTH 100.00 FEET OF THE NORTH 340.00 FEET OF
THE SOUTH HALF OF THE SOUTH HALF OF THE SOUTHEAST QUARTER OF SAID
SECTION 23.
ALSO EXCEPTING ALL OIL, GAS, HYDROCARBONS, AND OTHER MINERAL
SUBSTANCES LYING 500 FEET BELOW THE SOURFACE WITHOUT THE RIGHT OF
SURFACE ENTRY, AS RESERVED IN DEED FROM ELIZABETH BAILEY BY DEED
RECORDED IN BOOK 8916, PAGE 577, OFFICIAL RECORDS.
NOTE: SAID LAND IS ALSO SHOWN AS PARCELS 1 ON A PARCEL MAP RECORDED
IN BOOK 25, PAGE 22, OF PARCEL MAPS, RECORDS OF SAID ORANGE COUNTY.
oi
Exhibit"A"
Page 1 of 1
1
r t �
EXHIBIT "B"
MATRIX OF AFFORDABLE HOUSING UNITS LOCATED AT
16884 NICHOLS STREET
No. of Bridges Units
Projects for which
Nichols Units are Very Low Low Moderate Total Date
Approved Approved
TT 15109 0 3 0 3 2/28/95
TT 15033 0 7 0 7 3/6/95
TT 14515 0 6 0 6 6/13/95
TT 14990 0 6 0 6 6/13/95
TT 15071 0 2 0 2 12/12/95
TPM 95-164 0 1 0 1 12/3/95
TT 14655 0 3 0 3 6/16/92
TT 14177 0 3 0 3 1/9/90
DRB 97-6 0 8 0 8 5/8/97
TTM 14740 0 2 0 2 7/3/97
TPM 96-197 0 .1 0 1 2/23/98
TT 15499 0 1 0 1 6/12/98
TT 15343 0 2 0 2 11/13/98
TT 15469 0 32 0 32 6/23/99
Total 0 77 0 77
Nichols Units Remaining: 0
Exhibit B
Page I of 1
ATTACHMENT 3
V ' ,
°�� ns CITY OF HUNTINGTON BEACH
Lj Interoffice Communication
Economic Development Department
TO: Howard Zelefsky,Director of Planning
FROM: David C. Biggs,Director of Economic Development
DATE: December 3, 2001
SUBJECT: Bridges Affordable Housing Covenants— 16884 Nichols Street
As part of the Economic Development Department's efforts to monitor our affordable
housing projects for compliance with our restrictive covenants, my staff recently
discovered a problem with the Bridges Foundation project on Nichols Street. It appears
that three units that were made affordable to low-income families under the City's CDBG
program in.1997 were recently sold again for low-income housing under the City's
inclusionary housing program.
In order to secure the units made affordable under the CDBG program in 1997,the
Economic Development Department recorded a covenant on the property restricting three
units for 30 years. Subsequently, all 80 units at the property were sold to various
developers satisfying affordability requirements under the inclusionary housing program,.
and a different 30-year covenant was recorded on all 80 units. These two covenants
together imply that 83 units are affordable at the property,which is not possible with only
80 units available.
As neither the City nor Bridges intended to over-encumber the property, we discussed
with Bridges various solutions for this problem. The most agreeable solution appears to
be for three of the inclusionary units at Nichols to be transferred to the Bridges project on
Sher Lane. This would require that the inclusionary covenant on Nichols be reduced
from 80 units to 77 units; the covenant on Sher Lane would then be increased
correspondingly.
We have discussed the solution with Senior Planner Mary Beth Broeren, and she
indicated a willingness to implement the proposal to correct the discrepancy at the
Nichols project. It is my understanding that Mary Beth will be requesting the appropriate
documents to accomplish this proposal. My staff will provide whatever assistance
necessary to ensure this is accomplished.
•
S1,. EET
RCA ROUTING
INITIATING DEPARTMENT: - Planning
SUBJECT: Agreements Containing Covenants between the City and
VPM Bridges Apartments, L.P. and between the City and
Bridges America Sher, L.P.
COUNCIL MEETING DATE: March 18, 2002
RCA ATTACHMENTS STATUS ;
Ordinance (w/exhibits & legislative draft if applicable) Not Applicable
Resolution (w/exhibits & legislative draft if applicable) Not Applicable
Tract Map, Location Map and/or other Exhibits Not Applicable
Contract/Agreement (w/exhibits if applicable)
(Signed in full by the City Attorney) Attached
Subleases, Third Party Agreements, etc.
(Approved as to form by City Attorney) Not Applicable
Certificates of Insurance (Approved by the City Attome Not-Applicable
Financial Impact Statement (Unbudget, over$5,000) Not Applicable
Bonds If applicable) Not Applicable
Staff Report (If applicable) Not Applicable
Commission, Board or Committee Report (If applicable) Not Applicable
Findings/Conditions for Approval and/or Denial Not Applicable
EXPLANATION FOR MISSING ATTACHMENTS
REVIEWED RETURNED FORW RDED
Administrative Staff 3 '
Assistant City Administrator Initial
City Administrator Initial
City Clerk ��
EXPLANATION FOR RETURN OF ITEM:
RCA Author: HZ:SH:MBB:kjl
REQUEST FOR ACTION
MEETING DATE: October 16, 2000 DEPARTMENT ID NUMBER: PL00-26
Analysis:
A. PROJECT PROPOSAL:
Applicant: The Bridges America Foundation Inc., 18837 Brookhurst St., Ste. 303,
Fountain Valley, CA 92708 and City of Huntington Beach, 2000 Main St.,
Huntington Beach, CA 92648
Location: The covenanted property is located at 16884 Nichols Street.
The affordable housing agreement restricts 80 apartment units located at 16884 Nichols
Street to low-income households for a period of thirty years. The apartment project is owned
and managed by Bridges American Foundation, L.P., a non-profit housing organization.
B. STAFF ANALYSIS AND RECOMMENDATION:
The City of Huntington Beach requires that all new residential projects that consist of three or
more units provide the equivalent of 10 percent of the units as affordable housing.
Developers have the option of restricting units within their own project as affordable or
restricting units off-site.
In 1995, the Centerstone Company proposed to meet its affordable housing requirement for
the Greystone Homes project by working with Bridges America Foundation to acquire and
covenant the Nichols Street apartment complex. This established an affordable housing
"bank" by which the City's affordable housing requirement could be met. Developers would
pay a per unit fee to Bridges America Foundation which subsequently would covenant the
associated units for low income households. As of June 1999, all 80 units at the Nichols
Street project have been "acquired" as indicated by Exhibit B of Attachment No. 1.
The original affordable housing agreement for this project was approved by City staff in 1995
and recorded by the developer in 1996. Subsequently, it was determined that the
agreement was recorded in error. The proposed agreement would supersede the original
and will be recorded by the City of Huntington Beach. In the intervening years Bridges has
continued to restrict the units to low-income households as intended by the original
agreement. The revised agreement has been reviewed and signed by Bridges America
Foundation and the City Attorney's office. Staff recommends that the City Council approve
the agreement.
Environmental Status:
The subject request is exempt pursuant to the California Environmental Quality Act.
PL00-26 -2- 1015/00 3:31 PM
0 REQUEST FOR ACTION
MEETING DATE: October 16, 2000 DEPARTMENT ID NUMBER: PL00-26
Attachment(s):
City Clerk's
Page Number No. Description
1. Affordable Housing Agreement
RCA Author: MBB
PL00-26 -3- 10/5/00 3:31 PM
TTACHM.....
.....
ENT # 1
• LI
I
Recorded in Official Records, County of Orange
Gary Granville, Clerk-Recorder
IIIIIII IIIIIII III II IIIIIIII II I III II I iINO FEE
20000594352 04.15pm 11/02/00
109 11 Al2 35
RECORDING REQUESTED BY 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
AND WHEN RECORDED MAIL TO:
City of Huntington Beach
2000 Main Street
Huntington Beach, CA 92648
ro Attn: City Clerk
U
rx ,� (Space above for recorder)
x0
o This Agreement is recorded at the
request and for the benefit of the City
0 .0 ,--, of Huntington Beach and is exempt ,
u 0 M from the payment of fees pursuant to dr
Government Code Section 6103.
v �
v ?, AGREEMENT CONTAINING COVENANTS AFFECTING REAL PROPERTY
'g 14 BY AND BETWEEN THE CITY OF HUNTINGTON BEACH
o a � AND THE BRIDGES AMERICA FOUNDATION,L.P.
wN
W o THIS AGREEMENT CONTAINING COVENANTS AFFECTING REAL PROPERTY (the
4' a "Agreement") is entered into this 16th day of pgtober , 2000, by and between the
CITY OF HUNTINGTON BEACH, a municipal corporation ("City"), and THE BRIDGES
b z° AMERICA FOUNDATION, L.P., a California limited partnership ("Owner"), and supersedes
Instrument No. 19960029682, which was recorded by Owner on January 19, 1996, prior to its
u presentation to the City Council.
�a r�
a' RECITALS:
0
2
A. Owner is fee owner of record of that certain real property commonly known as
16884 Nichols Street (the"Site") located in the City of Huntington Beach, County of Orange,
State of California legally described in the attached Exhibit"A." There are currently twenty(20)
4-plexes with a total of eighty(80)multi-family apartment units located on the Site.
B. On January 19, 1996, Owner recorded against the Site that certain Agreement
Containing Covenants Affecting Real Property(the"Original Covenant") that was recorded as
Instrument No. 19960029682 in the official Records of the Orange County Recorder's Office.
The Original Covenant obligated Owner to provide twenty-two (22) affordable dwelling units
(the"Affordable Units")within the buildings on the Site, to satisfy the Affordable Housing
requirements TTM No. 15109 and CUP No. 94-40, approved on February 28, 1995, commonly
known as the Centerstone Project, and TTM No. 15033 and CUP No. 94-29, approved on
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t
March 6, 1995, commonly known as the Greystone Project; and TTM No. 14515(R), Site Plan
Amendment No. 94-2, TTM No. 14990, and CUP No. 94-26, approved on June 13, 1995,
commonly known as the Presley Projects; and
C. Since the recordation of the Original Covenant, the Owner has entered into
several agreements with other developers to use the Site to satisfy the affordable housing
requirements of various other development projects; and
D. City and Owner have set.forth.the individual development projects.and number of
affordable housing units required for each project on the matrix attached hereto as Exhibit `B"
and incorporated by this referenced as though fully set forth herein; and
E. The City and the Owner wish to enter into a formal Agreement to clarify the
affordable housing obligations set forth in the Original Covenant to provide for the long term
affordability of the Affordable units on the Site, and the additional affordable units described
hereinabove,
NOW, THEREFORE, BASED UPON THE FOREGOING RECITALS AND FOR
GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND SUFFICIENCY OF
WHICH IS ACKNOWLEDGED BY BOTH PARTIES, CITY AND OWNER AGREE AS
FOLOWS:
I. AFFORDABLE HOUSING
(A) Number of Units. Owner agrees to make available, restrict occupancy
to, and lease eighty(80) Affordable Units on the Site to "Lower Income Households" at an
"Affordable Rent" for the duration of the "Affordability Period" (as those terms are defined
hereinbelow). Nothing in this Agreement shall restrict Owner's right to select which of the
eighty(80)rental housing units on the Site shall be the Affordable Units and Owner may at is
option change the location of the Affordable Units-on the Site from time to time, provided that a
minimum of eighty(80)rental housing units shall be restricted as Affordable Units during the
entire Affordability Period.
As used in this Agreement, the term "Lower Income Household" shall mean
persons and families whose income does not exceed eighty percent (80%) of Orange County
median income, adjusted for family size, as determined by the United States Department of
Housing and Urban Development, as set forth in Health and Safety Code Section 50079.5.
As used in this Agreement, the term"Affordable Rent" shall have the meaning set
forth in Section I(D) hereinbelow.
As used in this Agreement, the term"Tenant" shall mean any person who rents or
leases any portion of the Site or any person who is not a fee or equitable owner of any portion of
the Site who uses the Site as his or her principal residence. For purposes of this Agreement,
principal residence will be determined in the same manner as principal residence is determined
for state residency under California Vehicle Code Section 516.
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(B) Duration of Affordability Requirements. The Affordable Units shall be
subject to the requirements of this Agreement for thirty(30) years from the date the final
Affordable Unit applicable to such development has been rented to a Lower Income Household.
City acknowledges that the residential dwelling units on the Site are occupied as of the date this
Agreement and that the requirements of this Agreement will be enforced by Owner as units are
vacated and become available for rental to eligible households in the ordinary course of business.
The duration of this requirement shall be known as the "Affordability Period."
(C) Income of Tenant. After the lease of any Affordable Unit to a Tenant,
Owner shall submit to the Planning Director of the City a completed income computation and
certification form, in such form as is generally used by City in administering its affordable
housing program from time to time. Owner shall certify that to the best of its knowledge each
Tenant of an Affordable Unit is a Lower Income Household and meets the eligibility
requirements established for the particular Affordable Unit occupied by such household. Owner
shall obtain an income certification from each Tenant of an Affordable Unit and shall certify
that, to the best of Owner's knowledge, the income of the tenant is truthfully set forth in the
income certification form. Owner shall verify the income certification of the Tenant in one or
more of the following methods as specifically requested by City:
(1) Obtain two (2)paycheck stubs from the tenant's two (2) most
recent pay periods.
(2) Obtain a true copy of an income tax return from the Tenant for the
most recent tax year in which a return was filed.
(3) Obtain an income verification certification from the Social
Security Administration and/or the California Department of Social Services if the Tenant
receives assistance from such agencies.
(4) Obtain an income verification certification from the Social
Security Administration and/or the California Department of Social Services if the Tenant
receives assistance from such agencies.
(5) obtain an alternate form of income verification reasonably
requested by City, if none of the above forms of verification is available to Owner.
If, after renting an Affordable Unit to an eligible household, the household's
income increases above the income level permitted for that unit, the household shall continue to
be permitted to reside in such Affordable Unit. Subsequently, however, when the next
residential rental unit on the Site becomes vacant and available for rent, the vacant unit shall
become an Affordable Unit subject to the restrictions of this Agreement (and subject to Owner's
retained discretion to change the location of Affordable Units from time to time, as provided in
Section I(A) herein.
(D) Determination of Affordable Rent for the Affordable Units. The
maximum monthly rental payment ("Affordable Rent") amount for the Affordable Units required
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to be leased to Lower Income Households shall be established at thirty-five percent(35%) times
seventy-nine percent (79%) of the monthly area median income for a household of four persons.
The Affordable Rent amount for the Affordable Units shall be adjusted annually
by the formula set forth above upon the publication of revised Orange County median income
figures by the United States Department of Housing and Urban Development.
OWNER UNDERSTANDS AND KNOWINGLY AGREES THAT THE
MAXIMUM RENTAL PAYMENTS TO BE ESTABLISHED BY.THIS FORMULA ARE NOT
NECESSARILY EQUAL TO THE FAIR MARKET RENT FOR THE AFFORDABLE UNITS,
AND MAY BE ESTABLISHED AT A LEVEL SUBSTANTIALLY BELOW THE FAIR
MARKET RENT LEVELS.
OWNER HEREBY AGREES TO RESTRICT THE AFFORDABLE UNITS
ACCORDINGLY.
O is initials
(E) Annual Report. Within sixty(60) days after the end of each
calendar year during the Affordability Period, Owner shall submit to City a.report verifying
Owner's compliance with the provisions of Section I(A)-(D) of this Agreement. Owner's final
annual report shall be submitted to City within sixty(60) days after the end of the Affordability
Period. Each annual report shall identify the number and location of the Affordable Units for the
applicable reporting period, the identity of each Tenant occupying an Affordable Unit during a
day portion of such period, the income and family size of each such Tenant, the Affordable Rent
for each of the Affordable Units, and the actual contract rent actually charged. If City prescribes
a particular form to be utilized by Owner in preparing the annual report, Owner shall utilize said
form,provided that it complies substantially with the foregoing requirements.
H. NON-DISCRIMINATION.
Owner, on behalf of itself and its successors, assigns, and each successor in
interest to the Site or any part thereof, hereby further covenants and agrees during the
Affordability Period:
(A) Not to discriminate upon the basis of sex, marital status, race, color, creed,
religion, national origin, or ancestry in the sale, lease, sublease, transfer or rental, or in the use,
occupancy, tenure, or enjoyment of any of the Affordable Units on the Site. Each and every
lease and contract entered into with respect to any of the Affordable Units on the Site during the
Affordability Period shall contain or be subject to substantially the following nondiscrimination
or nonsegregation clauses:
In leases: "The lessee herein covenants by and for itself, its successors and
assigns, and all persons claiming under or through them, and this lese is made and accepted upon
and subject to the following conditions:
4
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y^ 1 •
i
That there shall be no discrimination,against or segregation of any person or
group of persons on account of sex, marital status, race, color, creed, religion, national origin, or
ancestry, in the leasing, renting, subleasing, transferring, use, occupancy, tenure, or enjoyment of
the land herein leased, nor shall the lessee itself, or any other person claiming under or through
it, establish or permit such practices of discrimination or segregation with reference to the
selection, location, number, use, or occupancy of tenants, lessees, sublessees, subtenants, or
.vendees in the land herein leased."
In contracts: "There shall be no discrimination against -or segregation of any
persons-or group of persons on account of sex, marital status, rare, color, creed, religion, national
origin, or ancestry in the sale, lease, rental, sublease, transfer, use, occupancy, :tenure, or
enjoyment of the land, nor shall the transferee itself or any person claiming.under or through it,
establish or permit any such practice or practices of discriminationor segregation with reference
to the selection, location, number, use, or occupancy of tenants, lessees, subtenants, sublessees,
or vendees of the land. "
III. USE RESTRICTIONS
During the Affordability Period, Owner shall be required to take all reasonable
steps necessary to ensure that each Tenant of an Affordable Unit and all assignees and
transferees of such Tenant have knowledge of all terms and conditions of this Agreement by
including in each and every lease and rental agreement a clause which identifies this Agreement
by reference and makes this Agreement available for review by each Tenant in the Site
Manager's office. In addition, during the Affordability Period, each lease for any of the
Affordable Units on the Site shall contain provisions that the Affordable Unit shall be occupied,
used, and maintained as follows:
(A) the dwelling unit shall be used only for private dwelling purposes, with
appurtenant facilities, and for no other purposes;
(B) the Tenant shall not permit or suffer anything to be done or kept upon the
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 reasonable noises or otherwise, nor shall any Tenant commit or
permit any nuisance on the premises or fail to keep the premises free of rubbish, clippings, and
trash or commit or suffer any illegal act to be committed thereon;
(C) the Tenant shall comply with all of the lawful requirements of all
governmental authorities with respect to the premises;
(D) 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 City;
(E) no person shall be permitted to occupy the premises for transient or hotel
purposes; and
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(F) the Tenant shall comply in all respects with this Agreement and any
failure by the Tenant to comply with the terms of this Agreement shall be a default under the
Tenant's lease.
IV. APPLICABLE LAW
(A) If any provision of this Agreement or portion thereof, or the application to
any-person or circumstances, shall to any extent be held invalid,inoperative, or unenforceable,
the remainder of this Agreement, or the application of such provision or.portion thereof to any
other persons or circumstances, shall not be affected thereby; it shall not be.deemed that any
such invalid provision affects the consideration for this Agreement; and each provision of this
Agreement shall be valid and enforceable to the fullest extent permitted by law.
(B) This Agreement shall be construed in accordance with the laws of the State
of California.
V. MISCELLANEOUS
(A) Satisfaction of Affordable Housing Obligations of Development-Projects
Referenced Herein. By its approval and execution of this Agreement, City acknowledges that
upon the recordation of this Agreement against the Site, Owner shall have assumed the
obligations of the development projects listed on Exhibit `B to provide affordable housing; that
the owners/developers of those other projects thereafter shall be released from the obligations to
provide affordable housing as stated in the conditions of approval for such projects, and that
thereafter City shall look solely and exclusively to Owner and the Site for satisfaction of such
affordable housing obligations. The owners/developers of said projects shall be third party
beneficiaries of this Agreement to the extent necessary to-enforce their respective interests in this
Section V(A), and this Agreement shall not be modified, amended, or terminated in any manner
which affects the said projects or the respective interests of the owners/developers thereof,
without the prior written consent of the affected owner/developer(s), which consent may be
withheld in such owner/developer's sole and absolute discretion.
(B) Binding on Successors and Assigns. The covenants and agreements established
in this Agreement shall, without regard to technical classification and designation, be binding on
Owner and any successor to Owner's right, title, and interest in and to all or any portion of the
Site, for the benefit of and in favor of the City of Huntington Beach. All the covenants contained
in this Agreement shall remain in effect for the Affordability Period, and shall automatically
terminate and be of no further force or effect after such time. Upon expiration of the
Affordability Period, City agrees to cooperate with Owner, at no cost to City, in removing this
Agreement of record from the Site.
(C) Subordination to Trust Deeds. Notwithstanding any other provision in this
Agreement to the contrary, the covenants and agreements established in this Agreement at all
times shall be junior and subordinate to the lien of any mortgage or deed of trust recorded by or
on behalf of a lender to secure a loan for the acquisition or improvement of the Site, including
without limitation any deed of trust recorded concurrently herewith. City agrees, at no expense
to City, to execute such documents as may be reasonably requested by Owner, any successor or .
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assign to owner's right, title, and interest in and to all or any portion of the Site, or any lender of
any such person subordinating City's rights and interest under this Agreement to the lien of any
trust deed recorded or to be recorded by a lender securing a loan for the acquisition or
improvement of the Site. Owner, Owner's successor or assign, or the benefited lender shall be
responsible for preparing the document(s) creating such subordination of City's interest.
IN WITNESS WHEREOF, Cityand Owner have executed this Agreement containing
Covenants Affecting Real Property to be effective as of the date first written above.
UNTIN EACH,
a mum ' corp ation
ayor
ATTEST: APPROVED AS TO FORM:
City Clerk �o/�Y . City Attorney
X0 coo
REVIEWED AND.APPROVED/: INITIA ED AND APPROVED:
City Adl ifmstrator Director of Planning
THE BRIDGES AMERICA FOUNDATION, L.P.,
a California limited partnership
By: The Bridges America Foundation,
a Delaware corporation
By. "�40,•�
print name
ITS: (circle one)Chairman/President/Vice Presiden
AND
By:
print name
ITS: (circle one)Secretary/Chief Financial
Officer/Asst. Secretary-Treasurer
7
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�1
CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
State of California
ss.
County of Q
On 1-cr , before me, 41 1
Date Name and Title of Officer(e. .,"Jane Doe,Notary blic")
personally appeared ovan ,
�— Name(s)of Signer(s)
❑ personally known to me
proved to me on the basis of satisfactory
evidence
to be the personN whose name( is/k
subscribed to the withio instrument and
acknowledged to me that he/t*executed
the sa a in 's/her/t"r authorized
capacity(, and that by )$Wher/tt r
signature44on the instrument the person; or
USA E.KOCR the entity upon behalf of which the person(
_ Commission#1171130 z acted, executed the instrument.
Notary Public-California g_
Orange County WI SS my hand an o ' is seal.
4AmyComm-Bq*esjan26,2002F
Place Notary Seal Above Signature of Notary Public
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 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
Signer's Name: _
❑ Individual .
Top of thumb here
❑ Corporate Officer—Title(s):
❑ Partner—❑ Limited ❑ General
❑ Attorney in Fact
❑ Trustee
Guardian or Conservator
❑ Other:
Signer Is Representing:
0 1997 National Notary Association•9350 De Soto Ave.,P.O.Box 2402•Chatsworth,CA 91313-2402 Prod.No.5907 Reorder:Call Toll-Free 1.800.876.6827
CALIFORNIA ALL-PURPOR ACKNOWLEDGMENT
State of
County of Aooi
On &152G�obe- Ztl -4 000 before me,
Da a Name and Title of Offio e. .,"Jane Doe,No a Public")
personally appeared ✓��!/e � 42&Z �i����P �i��2u ,
Name(s)of Signer(s)
.personally known to me
❑ proved to me on the basis of satisfactory evidence
to be the person(s) whose name(s)Oare subscribed to the
within instrument and acknowledged to me that*§k6/they
executed the same in his/>dr/their authorized capacity(ies),
and that by,lxls/�_Wr/their signature(s) on the instrument the
person(s), or the entity upon behalf of which the person(s)
CHRISTINE CLEARY acted, executed the instrument.
�apR��� WITNESS my hand and official seal.
Orange County
MyCarrtm.6q�hesJanl@,�4 ,
Signatur otary Public
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 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(les) 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
M.
❑ Guardian or Conservator ❑ Guardian or Conservator
❑ Other: Top of thumb here ❑ Other: Top of thumb here
Signer Is Representing: Signer Is Representing:
01996 National Notary Association•8236 Remmet Ave.,P.O.Box 7184•Canoga Park,CA 91309-7184 Prod.No.5907 Reorder:Call Toll-Free 1-800-876-6827
c.
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EXHIBIT "A"
LEGAL DESCRIPTION OF THE SITE
THAT PORTION OF THE WEST 10 ACRES OF THE SOUTH HALF OF THE SOUTH
HALF'OF THE SOUTHEAST QUARTER OF SECTION 23, TOWNSHIP S:SOUTH, RANGE
11 WEST, IN THE RANCHO LA.BOLSA.CHICA, AS.SHOWN ON A MAP RECORDED IN
BOOK 51,. PAGE 13,- OF- MISCELLANEOUS MAPS, -RECORDS.-.OF. SAID :COUNTY,
DESCRIBED AS FOLLOWS-
BEGINNING AT THE NORTHEAST CORNER OF SAID.WEST_1 O.ACRES; THENCE
SOUTH 340.00 FEET; THENCE WEST 640.00 FEET PARALLEL WITH THE NORTH LINE
OF SAID WEST 10 ACRES TO THE EAST LINE OF THE RIGHT-OF-WAY OF THE
SOUTHERN PACIFIC RAILWAY; THENCE NORTH 340.00 FEET ALONG SAID EAST
LINE TO THE NORTH LINE OF SAID WEST 10 ACRES; THENCE EAST 640.00 FEET TO
THE POINT OF BEGINNING.
EXCEPTING THEREFROM THAT PORTION THEREOF INCLUDED WITHIN THE
WESTERLY 570.00 FEET OF THE SOUTH 100.00 FEET OF THE NORTH 340.00 FEET OF
THE SOUTH HALF OF THE SOUTH HALF OF THE SOUTHEAST QUARTER OF SAID
SECTION 23.
ALSO EXCEPTING ALL OIL, GAS, HYDROCARBONS, AND OTHER MINERAL
SUBSTANCES LYING 500 FEET BELOW THE SOURFACE WITHOUT THE RIGHT OF
SURFACE ENTRY, AS RESERVED IN DEED FROM ELIZABETH BAILEY BY DEED
RECORDED IN BOOK 8916, PAGE 577, OFFICIAL RECORDS.
NOTE: SAID LAND IS ALSO SHOWN AS PARCELS I ON A PARCEL MAP RECORDED IN BOOK 25, PAGE 22, OF PARCEL MAPS, RECORDS OF SAID ORANGE COUNTY.
Exhibit"A"
Page 1 of 1
EXHIBIT `B"
MATRIX OF AFFORDABLE HOUSING UNITS LOCATED AT
16884 NICHOLS STREET
No. of Bridges Units
Projects for which
Nichols Units are Very Low Low Moderate Total Date
Approved Approved
TT 15109 0 3 0 3 2/28/95
TT 15033 0 7 0 7 3/6/95
TT 14515 0 6 0 6 6/13/95
TT 14990 0 6 0 6 6/13/95
TT 15071 0 2 0 2 12/12/95
TPM 95-164 0 1 0 1 12/3/95
TT 14655 0 3 0 3 6/16/92
TT 14177 0 3 . 0 3 1/9/90
DRB 97-6 0 8 0 8 5/8/97
TTM 14740 0 2 0 2 7/3/97
TPM 96-19.7 0 1 0 1 2/23/98
TT 15499 0 1 0 1 6/12/98
TT 15343 0 2 0 2 11/13/98
TT 15691 0 3 0 3 3/31/99
TT 15469 0 32 0 32 6/23/99
Total 0 80 0 80
Nichols Units Remaining: 0
Exhibit B
Page 1 of 1
GES
Bridges America Foundation Inc. "People RwbingPeoP le'
Resolution of the Board of Directors
of the Bridges America Foundation
The following resolution was adopted by the Board of Directors of the Bridges
America Foundation (Bridges) effective September 1, 1999.
Resolved that JoAnn Ulvan,Affordable Housing Coordinator of Bridges be here by
authorized to execute and deliver such documents and instruments necessary on
behalf of Bridges America Foundation,as General Partner, to the City of
Huntington Beach in regard to affordable deed restrictions to be recorded on the
property located at 16851-89 Nichols Street and 7611 Washington Street,
Huntington Beach.
Dated as of September 1, 1999
Steve rriso Date
Director
Phone: (714) 962-1302 18837 Brookhurst Street Fax: (714) 962-2922
Suite 303
Fountain Valley, CA 92708
THE BRIDGES AMERICA SHER LANE,L.P.
A California Limited Partnership
LIMITED PARTNERSHIP AGREEMENT
This LIMITED PARTNERSHIP AGREEMENT (the "Agreement") is made and entered into by and
between THE BRIDGES AMERICA FOUNDATION,a Delaware nonprofit corporation(the"General Partner")and
KIRK S. EVANS, BILLY G. GELLER and B.J.P. Properties, Inc., a Texas corporation (collectively, the "Limited
Partners").The General Partner and the Limited Partners shall be referred to collectively as the "Partners."
RECITALS
The parties desire to enter into the limited partnership agreement(the "Partnership Agreement") to set forth
the rights, obligations, duties and liabilities of the Partners and to form the Partnership for the purpose of acquiring,
developing and managing the Project,as set forth herein.
NOW,THEREFORE,the parties agree to the formation of the Partnership as a limited partnership pursuant
to the Partnership Act, and to enter into the Partrigship Agreement upon the following terms and conditions:
ARTICLE 1
FORMATION OF PARTNERSHIP
i
1.1 Formation. The parties hereto, by executing this Agreement, hereby form a limited partnership
(the "Partnership") which shall operate under the California Revised Limited Partnership Act(the "California Act").
The California Act shall govern the rights and liabilities of the parties,except as otherwise herein expressly stated.
1.2 Certificates. The General Partner shall execute a Certificate of Limited Partnership (the
"Certificate")and cause the Certificate to be filed in the office of the Secretary of State of California.Thereafter, the
General Partner shall execute and cause to be filed Certificates of Amendment of the Certificate of Limited
Partnership whenever required by the California Act or this Agreement. The General Partner shall also record a .
certified copy of the Certificate in the office of the County Recorder in the county in which the Partnership owns
real property. From time to time thereafter, the General Partner shall execute or cause to be executed such other
certificates and documents conforming thereto, and the General Partner shall do or cause to be done all such filings,
recordings, publishings and other acts as may be necessary or appropriate to comply with all requirements for the
operation of a limited partnership pursuant to the laws of and in the State of California and of all other jurisdictions
wherein the Partnership shall conduct its business.
ARTICLE 2
NAME AND PRINCIPAL OFFICE
2.1 Name. The business of the Partnership shall be conducted under the name "THE BRIDGES
AMERICA SHER LANE L.P.,a California limited partnership."
2.2 . Place of Business. The principal office of the Partnership and the address of the General Partner
shall be 18837 Brookhurst Street,Suite 303, Fountain Valley, California 92708,provided, however,that the General
Partner may change the address of the principal office by notice in writing to all Limited Partners. In addition, the
Partnership may maintain such other offices as the General Partner may deem advisable at any other place or places
within the United States.
ARTICLE 3
DEFINITIONS
3.1 Definitions. The following terms used in this Partnership Agreement shall (unless otherwise
expressly provided herein or unless the context otherwise requires)have the following respective meanings:
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Affiliate. The term "Affiliate", means any person or entity directly or indirectly controlling,
controlled by, or under common control with another person or entity, and in the case of an individual, includes
family members.
Capital Account Deficit.The term "Capital Account Deficit" means with respect to each Partner,
the deficit balance, if any, of such Partner's Capital Account as of the end of the relevant fiscal year, after giving
effect to the adjustments as required by the provisions of Treasury Regulation Section 1.704-1(b).
Capital Contribution. The term "Capital Contribution" means the Investor's initial cash
investment in the Partnership as set forth in Section 6.1.
Cash Available for Distribution.The term "Cash Available for Distribution" means all proceeds
available for distribution by the Partnership from operations after the payment of all Partnership obligations then due
and payable, including fees and expenses to the General Partner, prepayment of such other Partnership obligations
as the General Partner may deem reasonable,and the establishment of reserves.
Code.The term"Code"means the Internal Revenue Code of 1986,as amended.
Distributions. The term "Distributions" means the distribution by the Partnership to the Partners
of Cash Available for Distribution or Net Proceeds from Sales or Refinancings.
General Partner. The term "General Partner" means The Bridges America Foundation, a
Delaware nonprofit corporation.
Limited Partnership. The term "Limited Partnership" means THE BRIDGES AMERICA SHER
LANE, L.P.,a California limited partnership.
Limited Partnership Interest. The term "Limited Partnership Interest" means each Limited
Partner's Percentage Interest.
Management Agent. The term "Management Agent" shall mean the property management
company that will contract with the Partnership to manage the Project on a day-to-day basis for the Partnership as
determined by the Partnership in accordance with Section 11.2.
Minimum Gain. The term "Minimum Gain" means the item set forth in Treasury Regulation
1.704-2(b)(2)and 1.704-2(d).
Net Proceeds from Sales or Refinancings. The term "Net Proceeds from Sales or Refinancings"
means the funds received by the Partnership from the sale or refinancing by the Partnership of all or a part of its
assets.which is not in the ordinary course of its business after the payment of all Partnership obligations then due
and payable, including fees and expenses to the General Partner, prepayment of such other Partnership obligations
as the General Partner may deem reasonable,and the establishment of reserves.
Nonrecourse Deductions. The term "Nonrecourse Deductions" means those deductions set forth
in Treasury Regulation Section 1.704-2(b)(1).
Nonrecourse Debt. The term "Nonrecourse Debt" means a liability as set forth in Treasury
Regulation 1.704-2(b)(3).
Partner or Partners.The terms "Partner"or"Partners" mean respectively, the General Partner or
Limited Partners or the General Partner and the Limited Partners.
Partner Minimum Gain. The term "Partner Minimum Gain" means the amounts referred to in
Treasury Regulation 1.704-2(i)(3).
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Partner Nonrecourse Deductions. The term "Partner Nonrecourse Deductions" means the items
set forth in Treasury Regulation Section 1.704-2(i)(1)and 1.704-2(i)(2).
Partner Nonrecourse Debt.The term"Partner Nonrecourse Debt" means a liability as set forth in
Treasury Regulation 1.704-2(b)(4).
Partnership. The term "Partnership" means THE BRIDGES SHER LANE L.P., a California
limited partnership. .
Partnership Agreement. The term "Partnership Agreement" means the Agreement of Limited
Partnership of THE BRIDGES AMERICA SHER LANE, L.P.
Percentage Interest. The term "Percentage Interest" with respect to each Partner shall mean the
following percentages:
General Partner 15.001%
Each Limited Partner 28.333%
Project. The term "Project" means the acquisition, development and. operation of a 66 unit
apartment complex located in Huntington Beach, California, as more particularly described in Exhibit A attached
hereto.
i
UBTI.The term"UBTI"means Unrelated Business Taxable Income as defined in the Code.
ARTICLE 4
PURPOSE
4.1 Purpose.
(a) The only purposes of the Partnership are to acquire, own, operate, maintain, manage,.
lease, sell, mortgage or otherwise dispose of the Project. It is the intent of the Partners that(i) a portion of the units
of the Project will be set aside, maintained and rented to persons qualifying as "lower income households" (as
defined in Section 50070.5 of the California Health and Safety Code) ("Affordable Housing"); (ii) the Partnership
will enter into agreements with certain unaffiliated for profit developers whereby the Partnership will agree to record
a covenant against the Project enforceable by the City of Huntington Beach (the "City") to set aside a certain
number of Affordable Housing units in satisfaction of certain obligations such for profit developers have with the
City; (iii) the Partnership qualify for and maintain a welfare exemption under Section 214(g) of the California
Revenue and Taxation Code.
(b) In order to carry out its business and purpose under Section 4.1 hereof, subject to the
terms and conditions hereof,the Partnership is hereby authorized to:
(i) Acquire and own the Property, and to hold such Property for investment
purposes;
(ii) Own,maintain,operate and lease the Project;
(iii) Mortgage, lease, transfer and exchange or otherwise convey and encumber the
Project in furtherance of any and all of the objects of its business in connection with the Project;
(iv) Enter into, perform and carry out contracts of any kind necessary to, or in
connection with or incidental to, the ownership, financing, maintenance and operation of the Project, including, but
not by way of limitation, any contracts with any for profit developers, the City or any other person which may be
desirable or necessary to comply with the requirements of such persons, including any agreements relating to
regulations or restrictions contained in any mortgages or deeds as to rents or restrictions thereof, sales, charges,
capital structure,rate of return and methods of operation;
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(v) Rent dwelling units in the Project from time to time in accordance with
applicable federal, state and local regulations, in such a manner so as to meet its Affordable Housing purpose or to
qualify or receive federal housing tax credits, collect rents therefrom, pay the expenses incurred in connection
therewith, and distribute the net proceeds to the Partners,subject to any requirements which may be imposed by any
Authority or Lender;and
(vi) Purchase, transfer, mortgage, pledge and exercise all other rights, powers,
privileges and other incidence of ownership with respect to the Project and.borrow or raise money without limitation
as to amount or manner and carry on any and all activities incidental and appropriate to effectuate the purposes of
the Partnership.
(c) In order to carry out its purpose, the Partnership may, among other things, form
subsidiaries (which may be limited partnerships, limited liability companies, corporations, trusts or other form of
entity) and may contribute the Project, or portion thereof, to such subsidiary so that the development and operation
of the Project, or portion thereof, occurs within the subsidiary shall be determined by a vote of the Partners in
accordance with Article 11 hereof.
ARTICLE 5
TERM OF PARTNERSHIP
5.1 Effective Date. The Partnership shall commence on the date (the "Effective Date") that a
Certificate of Limited Partnership is filed under the California Act.
5.2 Term. Unless earlier dissolved in accordance with the provisions of this Agreement, the
Partnership shall be dissolved on December 31,2052.
ARTICLE 6
CAPITAL CONTRIBUTIONS
6.1 Contributions.
(a) Partner's Contribution. Concurrently with the execution of this Agreement, each
Partner will contribute capital to the Partnership in an amount equal to$100.
(b) Names, Addresses and Contributions of Partners. The names, addresses and Capital
Contributions of the Partners shall be set forth in Schedule I attached hereto, as amended from time to time, and
incorporated herein by reference.
6.2 Capital Account. An individual capital account shall be maintained for each Partner. The capital
accounts of each Partner shall consist of such Partner's Capital Contribution, as increased by any contribution of
capital subsequent to his original contribution, and by the fair market"value of property contributed by such Partner.
Each Partner's capital account shall be maintained in accordance.with the governing provisions of Treasury
Regulation Section 1.704-1(b)(2)(iv).
6.3 No Interest; Withdrawal. No Partner shall have the right to demand a return of its Capital
Contribution,except as otherwise provided in this Agreement. No Partner shall have priority over any other Partner,
either as to return of its Capital Contribution or as to profits, losses or distributions, except as otherwise specifically
provided herein.Moreover,no General Partner shall be personally liable for the return of the Capital Contribution of
the Limited Partners, or any portion thereof, it being expressly understood that any such return shall be made solely
from assets of the Partnership, nor shall any General Partner be required to pay the Partnership or any Partner any
deficit in any Capital Account shall not be treated as an asset of the Partnership; provided, however, that if on final
liquidation, the Capital Account of a General Partner is negative, such General Partner shall make a contribution to
the capital of the Partnership in an amount equal to the deficit balance in its Capital Account. Further, the Limited
Partners shall not be required to pay to the Partnership any deficit in their Capital Account upon dissolution or
otherwise, except as provided by law. No interest shall be paid on any Capital Account or Capital Contribution. No
Partner shall have the right to demand or receive property other than cash for its Interest. Each of the Partners does
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hereby agree to, and does hereby, waive any right such Partner may otherwise have to cause any asset of the
Partnership to be partitioned or to file a complaint or institute any proceeding at law or in equity seeking to have any
such asset partitioned.
6.4 Offer and Sale of Additional Interests.
(a) If, in the good faith judgment of the General Partner, funds reasonably necessary for the
conduct of the Partnership business, including the availability of Tax Credits on the Project, are not otherwise
available to the Partnership on reasonable terms and conditions, then the Partnership may adopt a plan to obtain
additional capital contributions from existing Partners or the sale, in a private or public•-placement of additional
equity or debt interests(the"Plan")as determined by a vote of.the Partners in accordance with Article 11 hereof.
(b) For purposes of this Section 6.4, as well as all preceding and forthcoming paragraphs in
this Partnership Agreement, except as otherwise provided, a "pro rata" interest of a Partner shall be such Partner's
Percentage Interest as set forth in Schedule I. Any cost incurred in connection-with such additional offerings is to be
an expense of the Partnership.
6.5 Loans.Any Partner or Affiliate of a Partner may, with the written consent of the General Partner,
lend or advance money to the Partnership. If a General Partner or, with the written consent of the General Partner,
any Limited Partner shall make any loans to the Partnership or advance money on its behalf, the amount of any such
loan or advance shall not be treated as a contribution to the capital of the Partnership, but shall be a debt due from
the Partnership. The amount of any such loan or advance by a lendigg Partner or an Affiliate of a Partner shall be
repayable out of the Partnership's cash and shall bear interest at a rate of not in excess of the greater of(i) the prime
rate established, from time to time, by any major bank selected by the General Partner for loans to the bank's most
credit worthy commercial borrowers, plus five percent(5%)per annum, or(ii) the maximum rate permitted by law.
None of the Partners or their Affiliates shall be obligated to make any loan or advance to the Partnership.
6.6 No Third Party Rights. The obligations or rights of the Partnership or of Partners to make or
require any contribution under this Agreement shall not grant any rights.to or confer-any benefits upon any,Person
who is neither the Partnership nor a Partner.
ARTICLE 7
ALLOCATIONS OF INCOME,LOSS AND DISTRIBUTIONS
7.1 Allocations of Net Income and Net Loss and Credits. After first giving effect to the Special
Allocations of Section 7.4,Net Income and Net Loss and Credits shall be allocated as follows:
(a) Net Income shall be allocated in the following order and priority:
(i) First, to the Partners in an amount and priority to the extent of any losses under
Sections 7.1(b)until the sum of the Net Income for all current and prior fiscal years allocated under Section.7.2(a)(i)
equals the cumulative Net Loss for all current and prior fiscal years allocated to Partners pursuant to Section 7.1;
and
(ii) Thereafter,to the Partners in accordance with their Percentage Interests.
(b) All Net Loss shall be allocated one percent (1%) to the General Partner and thirty-three
percent(33%)to each Limited Partner subject to the provisions of Section 7.4.
7.2 Distributions.Subject to the provisions of Section 6.4:
(a) The Partnership will distribute Cash Available for Distribution during each year as
follows:
(i) First, to the Limited Partners until the Limited Partners have received an amount
equal to their Capital Contribution less all distributions made in accordance with Section 7.3(a);
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(ii) Second, to the General Partner until the General Partner has received an amount
equal to its Capital Contribution less all prior distributions made in accordance with Section 7.3(a);and
(iii) Third,to the Partners in accordance with their Percentage Interests.
7.3 Allocation By Units. Net Income and Net Loss and Distributions shall be allocated among
Limited Partners in proportion to their Percentage Interests. In the event Limited Partners are admitted to the
Partnership on different dates during any fiscal year,Net Income or Net Losses allocated to the Limited Partners for
each such fiscal year shall be allocated among the Limited Partners in proportion to the Percentage Interests each
hold from time to time during such fiscal years in accordance with I.R.C. Section 706 using any convention
permitted by law and selected by the General Partner.
7.4 Special Allocation Rules.The following special allocations shall be made in the following order:
(a) Minimum Gain Chargeback. Notwithstanding any other provisions of this Article 7,
except as otherwise provided in Regulation Section 1.704-2(f), if there is a net decrease in Partnership Minimum
Gain(as defined in the Treasury Regulations) during any Partnership fiscal year, each General Partner and Limited
Partner shall be specially allocated items of Partnership income and gain for such year(and, if necessary,subsequent
years) in an amount equal to such Partner's share of-the net decrease in Partnership Minimum Gain, determined in
accordance with Regulation Section 1.704-2(g). Allocations pursuant to the previous sentence shall be made in
proportion to the respective amounts required to be allocated to each respective Partner pursuant thereto. The items
to be so allocated shall be determined in accordance with Sections LP4-2(f)(6) and 1.704-20)(2) of the Treasury
Regulations. This Section 7.4(a) is intended to comply with the minimum gain chargeback requirement in Section
1.704-2(f)of the Regulations and shall be interpreted consistently therewith.To the extent permitted by such Section
of the Regulations and for the purposes of this Section 7.4(a) only, each Person's Capital Account Deficit shall be
determined prior to any other allocations pursuant to this Section 7.4 with respect to such fiscal year and without
regard to any net decrease in Partner.Minimum Gain during such fiscal year.
(b) Partner Minimum Gain Chargeback. Notwithstanding any other provision of this
Article 7 except Section 7.4(a),and except as otherwise provided in Section 1.704(i)(4)of the Treasury Regulations,
if there is a net decrease in Partner Minimum Gain attributable to a Partner Nonrecourse Debt during any
Partnership fiscal year, each Person who has a share of the Partner Minimum Gain attributable to such Partner
Nonrecourse Debt, determined in accordance with Section 1.704-2(i)(5), shall be specially allocated items of
Partnership income and gain for such year(and, if necessary, subsequent years) in an amount equal to such Person's
share of the net decrease in Partner Minimum Gain attributable to such Partner Nonrecourse Debt, determined in
accordance with Regulations Section 1.704-2(i)(5),that is allocable to the disposition of Partnership property subject
to such Partner Nonrecourse Debt, determined in accordance with Regulations Section 1.704-2(i)(4). Allocations
pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to
each General Partner and Limited Partner pursuant thereto. The items to be so allocated shall be determined in
accordance with Sections 1.704-2(i)(4) and 1.704-20)(2) of the Regulations. This Section 7.4(b) is intended to
comply with the minimum gain chargeback requirement in Section 1.704-2(i)(4) of the Regulations and shall be
interpreted consistently therewith. Solely for purposes of this Section 7.4(b), each Person's Adjusted Capital
Account Deficit shall be determined prior to any other allocations pursuant to this Article 7 with respect to such
fiscal year,other than allocations pursuant to Section 7.4(a)hereof.
(c) Qualified Income Offset. In the event any Limited Partner who is not a General Partner
unexpectedly receives any adjustments, allocations, or distributions described in Regulations Section 1.704-
l(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5), or 1.704-1(b)(2)(ii)(d)(6), items of Partnership income and gain shall be
specially allocated to each such Limited Partner in an amount and manner sufficient to eliminate, to the extent
required by the Regulations, the Capital Account Deficit of such Limited Partners as quickly as possible, provided
that an allocation pursuant to this Section 7.4(c) shall be made if and only to the extent that such Limited Partner
would have a Capital Account Deficit after all other allocations provided for in this Article 7 have been tentatively
made as if this Section 7.4(c)were not in the Agreement.
(d) Gross Income Allocation.In the event any Limited Partner who is not a General Partner
has a Deficit Capital Account at the end of any Partnership fiscal year that is in excess of the sum of(i) the amount
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such Limited Partner is obligated to restore (pursuant to the terms of such Limited Partner's Promissory Note or
otherwise),and(ii)the amount such Limited Partner is deemed to be obligated to restore pursuant to the penultimate
sentences of Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5), each such Limited Partner shall be specially
allocated items of Partnership income and gain in the amount of such excess as quickly as possible provided Mat an
allocation pursuant to this Section 7.4(d) shall be made if and only to the extent that such Limited Partner would
have a deficit Capital Account in excess of such sum after all other allocations provided for in this Article 7 have
been tentatively made as if Section 7.4(c)hereof and this Section 7.4(d)were not in the Agreement.
` (e) Nonrecourse Deductions. Nonrecourse Deductions for any fiscal year or other period
shall be specially allocated one percent(1%) to the General Partner and thirty=three percent (33%) to each Limited
Partner.
(f) Partner Nonrecourse Deductions. Any Partner Nonrecourse Deductions for any fiscal
year or other period shall be specially allocated to the General Partner or Limited Partner who bears the economic
risk of loss with respect to the Partner Nonrecourse Debt to which such Partner Nonrecourse Deductions are
attributable in accordance with Regulations Section 1.704-2(i)(1).
(g) Section 734 Adjustmgnt. To the extent an adjustment to the adjusted tax basis of any
Partnership asset pursuant to Code Section 734(b) or Code Section 743(b) is required, pursuant to Regulations
Section 1.704-1(b)(2)(iv)(m), to be taken into account in determining Capital Accounts, the amount of such
adjustment to the Capital Accounts shall be treated as an item of gain (if the adjustment increases the basis of the
asset) or loss (if the adjustment decreases such basis) and such gaip or loss shall be specially allocated to the
Partners in a manner consistent with the manner in which their Capital Accounts are required to be adjusted pursuant
to such Section of the Regulations.
(h) Curative Allocations. The "Regulatory Allocations" consist of allocations pursuant to
Sections 7.4(a), (b), (c), (d), (e), (f) and (g) hereof. It is the intent of the Partners that to the extent possible, all
Regulatory Allocations-shall-be offset with other Regulatory Allocations.or with special allocations of other items of
Partnership income gain,.loss or deduction pursuant to this Section 7.4(h). Notwithstanding any other provisions of
this Agreement,other than the Regulatory•Allocations,-the General Partner shall allocate items of income, gain, loss
and deduction among the General Partner and Limited Partners so that,to the extent possible,the net amount of such
allocations of other items and the Regulatory Allocations to each General Partner and Limited Partner shall be equal
to the net amount that would have been allocated to each such General Partner and Limited Partner if the Regulatory
Allocations had not occurred.The General Partner shall have reasonable discretion, with respect to each Partnership
fiscal year, to(i)apply the provisions of Section 7.4(h)hereof in whatever order is likely to minimize the economic
distortions that might otherwise result from the Regulatory Allocations and future Regulatory Allocations, and (ii)
divide all allocations pursuant to Section 7.4(h)hereof among the General Partner and Limited Partners in a manner
that is likely to minimize such economic distortions.
(i) Periodic Allocations. For purposes of determining the Net Income, Net Losses, or any
other items allocable to any period, Net Income, Net Losses, and any such other items shall be determined on a
daily, monthly, or other basis, as determined by the General Partner using any permissible method under Code
Section 706 and the Treasury Regulations thereunder.
(j) General Allocations. Except as otherwise provided in this Agreement, all items of
Partnership income, gain, loss, deduction, and any other allocations not otherwise provided for shall be divided
among the Partners in the same proportions as they share Net Income or Net Losses,as the case may be, for the year.
7.5 704(c) Allocations. In accordance with Code Section 704(c) and the Treasury Regulations
thereunder, income, gain, loss, and deduction with respect to any property contributed to the capital of the
Partnership shall, solely for tax purposes, be allocated among the Partners so as to take account of any variation
between the adjusted basis of such property to the Partnership for federal income tax purposes and its initial fair
market value.
Any elections or other decisions relating to such allocations shall be made by the General Partner in any
manner that reasonably reflects the purpose and intention of this Agreement.Allocations pursuant to this Section 7.6
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ere solely for purposes of federal,state,and local taxes and shall not affect, or in any way be taken into account in
computinu, any Person's Capital Account or share of Profits, Losses, other items, or distributions pursuant to any
provision of this Agreement.
7.6 Intent of Allocations.It is the intent of the Partnership that this Agreement comply with the safe
harbor test set out in Treasury Regulation Sections 1.704-1(b)(2)(ii)(d) and 1.704-1(b)(4)(iv)(d) and the
requirements of those sections, Including the qualified income offset and minimum gain chargeback, which are
hereby incorporated by reference. If, for whatever reasons, the Partnership is advised by counsel or Its accountants
that the allocation provisions of this Agreement are unlikely to be respected for federal income tax purposes, the
General Partner is granted the authority to amend the allocation provisions of this Agreement, to the minimum
extent deemed necessary-by counsel or Its accountants to effect the plan of allocations and Distributions provided in
this Agreement. The General Partner shall have the discretion to adopt and revise rules,.conventions and procedures
as it believes appropriate with respect to the admission of Limited Partners to reflect Partners' interests in the
Partnership at the close of each year.
ARTICLE 8
COMPENSATION TO GENERAL PARMR AND AFFILIATES,
EXPENSES OF THE PARTNERSHIP
$.1 Asset Management Fee. The'Partnership sball pay a monthly asset management fee to the
General Partner, in the amount of one and one-half percent(1.5%)of the monthly rental receipts from operation of
the Project(the "Asset Management Pee").The Asset Management Fee paid to the General Partner shall be treated
as a guaranteed payment without regard to Income of the Partnership in accordance with Section 707(c)of tht Code.
8.2 Property Management Fee. The Partnership shall pay a monthly Property Management Fee
equal to an agreed percentage of lire net rental income of tie Project per month per occupied residential unit to the
Management Agent for its services in managing the Project. The partners shall agree on the percentage prior to
engaging the Agent.
8.3 Reimbursement of Expanses, The General Partner shall be-reimbursed for any expenses or
advances made on behalf of die Partnership with respect to the acquisition and development of the Project. The
General Partner may also be reimbursed by the Partnership, or the Partnership may pay directly, all expenses
incurred In connection with die formation and offering of interests In die Partnership,including, without limitation,
attorneys'and accountants'fees and printing and mailing expenses,
8.4 Partnership Administrative Expenses. 1-he General Patter Shnll be reimbursed for, or the
Partnership may pay directly,all direct expenses incurred in connection with the administration and operation of the
Partnership, including accounting and legal fees.The General Partner shall not be entitled to reimbursement for any
porbou of the General Partner's indirect overhead and administrative expenses.
8.5 No Other Fees.No General Partner or any Afllllate thereof, excluding any Limited Partner, shall
be entitled to receive any salary,compensation or other fee except as specifically set forth in this Section 8.
ARTICLE 9
RIGHTS AND OBLIGATIONS OF TIIE GENERAL PARTNER
9.1 General Powers.The General Partner shall be solely responoible for nanagement and control of
the business of the Limited Partnership and its services will be contributed to the Partnership. The General Partner
may delegate all or any of their powers, rights and obllentions hereunder and may appoint, employ, contract or
otherwise deal with any person for the transaction of business of the Partnership; which person may, under the
supervision of the General Partner,perform any act or sources for the Partnership as the Partnership may approve.
9.2 Specific Powers. In connection with such management and control, but Subject to the voting
tights of the Lanited Partners set forth in.Section 11.2 and the restrictions on the authority of the General Partner set
fortlt in Section 93,die General Partner @hall have the power and authority to do or cause to be done any and all acts
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„
(a) To place record title to, or the right to use, Partnership assets in the name or names of a
nominee or nominees,trustee or trustees or in a subsidiary formed by the Partnership;
(b) To acquire and enter into any contract of insurance which the General Partner deems
necessary or appropriate for the protection of the Partnership,or for the conservation of Partnership assets;
(c) To employ persons in the operation and management of the business of the Partnership
including, but not limited to supervisory managing agents, property management agents, insurance brokers, real
estate brokers and loan brokers subject to the consent of the Limited Partners as provided in Section 11.2;
(d) To prepare or cause to be prepared reports, statements and other relevant information for
distribution to Limited Partners;
(e) To open accounts and deposit and maintain funds in the name of the Partnership in banks
or savings and loan associations or other financial institutions; .
(f) To cause the Partnership to make or revoke any of the elections referred to in Sections
168,709,754 and any other pertinent provisions of the Code or any similar replacement provisions;
(g) To select as its fiscal year a calendar year or fiscal year as approved by the Internal
Revenue Service;
i
(h) To determine the appropriate accounting method or methods to be used by the
Partnership;
(i) To require in all Partnership obligations that the General Partner shall not have any
personal liability, except as set forth herein, but that the person or entity contracting with the Partnership is to look
solely to the Partnership and its assets for payment or satisfaction;
(j) To execute, acknowledge and deliver any and all instruments,to exercise this authority
including the granting of powers of attorney;
(k) To sign in its individual capacity on behalf of the Partnership;
(1) To act as the Tax Matters Partner in accordance with Code Section 6231(a)(7);
(m) To appoint a person, to act as agent for service of process for the Partnership, provided
such person is not an affiliate of the General Partner;
(n) To amend this Agreement as set forth herein,subject to Sections 11.2 and 13.7.
(o) To execute,acknowledge and deliver any and all documents and instruments necessary or
desirable to effectuate the foregoing.
9.3 . Restrictions on Authority of General Partner. The General Partner shall be subject to all the
restrictions and limitations of a partner in a partnership without limited partners. Notwithstanding any other Section
of this Agreement, the General Partner shall have no authority to perform any actin violation of applicable law,
government. regulations, or requirements of the City. In the event of any conflict between the terms of this
Agreement and any applicable government regulations or requirements of the City, the terms of such regulations or
requirements shall govern. The General Partner shall have no right or authority to do any of the following acts
without the consent of the Limited Partners in accordance with Section 11.2.
(a) Permit the merger,dissolution or winding up of the Partnership;
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(b) Sell, exchange, lease, mortgage, pledge or otherwise transfer all or a substantial part of
the assets of the Partnership, or enter into any agreement to sell, exchange, lease, mortgage, pledge or otherwise
transfer all or a substantial part of the assets of the Partnership;
(c) Change the nature or purposes of the Partnership's business;
(d) Withdraw as a General Partner;
(e) Elect to continue the business of the Partnership, other than under the circumstances
described in subsection(f)below;
(f) Admit a General Partner other than under the circumstances described in Section 11.2
and 14.1; a
(g) To construct or cause to be constructed any new or replacement capital improvements on
the Project which substantially alter the Project or its use;
(h) Borrow money, whether on a secured or unsecured basis, or refinance, recast, modify or
extend any loan to or on behalf of the Partnership or which affects or is secured by the assets of the Partnership;
(i) Borrow from the Partnership or commingle Partnership funds with funds of any other
Person including any funds of the General Partner or Affiliates; i
(j) Rent apartments in the Project in such a manner that the Project would not meet the
requirements of the City;
(k) To cause the Partnership to commence a proceeding seeking any decree, relief, order or
appointment in,respect to the Partnership under the federal bankruptcy laws, as now or hereafter constituted, or
under any other federal or state bankruptcy, insolvency or similar law, or.the.appointment of a receiver, liquidator,
assignee, custodian,-trustee, sequestrator.(or similar official) for the Partnership or for any substantial part of the .
Partnership's business or property, or to cause the Partnership to consent to any such decree, relief, order or
appointment initiated by any Person other than the Partnership;
(1) To acquire any real property in addition to the Project;
(m) To terminate any agreement with any City or any other Person;
(n) To withdraw any funds of the Partnership held in any accounts or on deposit in the name
of the Partnership in an amount in excess of$500;
(o) To make any distribution of Net Cash Flow or Net Cash Proceeds other than in.
accordance with the terms of this Agreement.
9.4 Management of Project. In addition to the foregoing management authority, the General Partner
sliall perform the following services on behalf of the Partnership: (i) advise the Partnership concerning particular
requirements of low-income housing rules and regulations;(ii) facilitate operation of the Project by appearance with
the City, for profit developers or other persons; (iii) .coordinate with local service agencies, including housing
authorities, welfare and social services departments, churches and other organizations operating for the purpose of
assisting the needy, to advise such agencies to refer potential tenants to the Project;(iv)obtain information from and
consult with low-income tenants in the Project as to services which might be provided; (v) use its best efforts to
effect and monitor compliance of the Partnership and the Project with all applicable regulations; and(vi)obtain and
maintain for the Partnership the Property Tax Exemption under California Revenue and Taxation Code Section
214(g) (the "Welfare Claim"). Notwithstanding any other provision of this Agreement, in the event the General
Partner fails to obtain or maintain the Welfare Claim, the General Partner may be removed by the Limited Partners
in accordance with Section 12.2 of this Agreement.
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9.5 Other Activities.Except as prohibited in this Agreement or in the applicable laws of the State of
California or other governmental entities having jurisdiction over the activities of the General Partner, any limited
partner, any shareholder, officer, director or employee thereof, any person owning a legal or beneficial interest
therein,and any Affiliate of any of them may engage in or possess an interest in any other business or venture of any
nature and description, independently or with others including, but not limited to, the ownership, financing,
syndication,leasing,operation,management,brokerage,and development of real property.The fact that a Partner,a
member of the family of that Partner or any Affiliate of that Partner is employed by, or is directly or indirectly
interested in or connected with, any person with which the Partnership transacts business shall not prohibit the
General Partner from dealing with that person.
9.6 No Personal Liability.The General Partner shall have no personal liability for the repayment of
the Invested Capital of any Limited Partner or to repay the Partnership any portion or all of any negative balance in
its capital account,except as otherwise provided in Article 7 and Section 14.4.
9.7 Compensation to General Partner.The General Partner shall be entitled to be compensated and
reimbursed for expenses.incurred in performing its management functions solely for services and expenses incurred
in managing the Partnership in accordance with the provisions of Articles 8 and 9 hereof.
9.8 Non-exclusivity.The General Partner shall devote to the affairs of the Partnership as much time as
is necessary to cant' on the Partnership's business and to perform' its duties as the General Partner hereunder;
provided,however,that the General Partner shall not be required to devote full time and attention to the Partnership
or to its business.
9.9 Indemnification. The Partnership, its receiver or its trustee, shall indemnify, save harness and
pay all judgments and claims against the Partners and their officers, directors, shareholders, employees, agents,
Affiliates(to the extent the liability of Affiliates arises solely from their relationship with a Partner,as a result of its
having performed the fiduciary obligations of a Partner or in connection with customary industry practices for
services included in the term"General Partner"for purposes of this Section 9.8), from any liability, loss or damage
incurred by them or by the Partnership or the Limited Partners by reason of any act performed or omitted to be
performed by them in connection with the business of the Partnership, including costs and attorneys' fees (which
attorneys'fees may be paid as incurred)and any amounts expended in the settlements of any claims of liability,loss
or damage provided that,if the liability,loss or claim arises out of any action or inaction of a Partner,(a)the Partner
must have determined, in good faith, that its course of conduct which caused the loss or liability was in the best
interest of the Partnership;(b)the action or inaction was not the result of fraud or gross negligence,by the Partner;
and (c) the indemnification or agreement to hold harmless shall be recoverable only from the assets of the
Partnership and not any other assets of the Limited Partners. All judgments against the Partnership and the General
Partner, against which the General Partner is entitled to indemnification, must first be satisfied from Partnership
assets before the General Partner is responsible. The Partnership shall not pay for any insurance, or portion thereof,
covering liability of the General Partner, for actions or omissions for which indemnification is not permitted
hereunder.The Partnership may,however,purchase and pay for insurance,including extended coverage liability and
casualty and workmen's compensation, as would be customary for any person owning comparable property and
engaged in a similar business and name the General Partner and any of its Affiliates as additional insured parties,
provided that the addition does not increase the premium cost to the Partnership.This Section 9.8 shall not constitute
a waiver by any Limited Partner of any right which he may have against any patty under federal or state securities
laws.
9.10 Taxation as Partnership.The General Partner,while serving as such, agrees to cause,by way of
but not limited to contributions of substantial services or additional capital,there to be compliance at all times with
the conditions required under the Code and current, and any future, regulations thereunder to ensure that the
Partnership will be classified as a partnership for federal income tax purposes and not as an association.
9.11 Fiduciary Duty.The General Partner shall have a fiduciary responsibility for the safekeeping and
use of all funds and assets of the Partnership,whether or not in its immediate possession or control,and it shall not
employ or permit another to employ such Rinds or assets in any runner except for the exclusive benefit of the
Limited Partnership.
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0.12 Commingling of Funds.The fluids of the Partnership shall not be commingled with funds of any
other person or entity.
9.13 Right to Rely on General Partner. Any person dealing with the Partnership may rely (without
duty of further inquiry)upon a certificate signed by the General Partner as to:
(a) The identity of any General Partner or Limited Partner;
(b) The existence or nonexistence of any fact or facts which constitute a condition precedent
to acts by a General Partner or which are in any further manner germane to the affairs of the Partnership;
(c) The persons who are authorized to execute and deliver any instrument or document of the .
Partnership;or .
(d) Any act or failure to act by the Partnership or any other-matter whatsoever involving the
Partnership or any Partner..
ARTICLE 10
BOOKS,RECORDS,REPORTS AND ACCOUNTING
10.1 Books and Records.The Partnership shall maintain at its principal office all of the following:
(a) A current list of the full name and last kn6wn business or residence address of each
Partner set forth in alphabetical order together with the contribution and the share in profits and losses of each
Partner;
(b) A copy of the Certificate of Limited Partnership and all certificates of amendment,
together with executed copies of any powers of attorney pursuant to which any certificate has been executed;
(c) Copies of the Partnership's federal,state, and local income tax or information returns and
reports,if any;
(d) Copies of the original Partnership Agreement and all amendments;
(e) Financial statements of the Limited Partnership for the six most recent fiscal years;and
(f) The Partnership's books and records for at least the current and past three fiscal years.
Upon reasonable request, a Limited Partner or his duly authorized representative shall have the right to°
inspect and copy any of the foregoing during normal business hours and to obtain, promptly after becoming.
available, a copy of the Partnership's income tax or information returns for each year. Upon request of a Limited
Partner, the General Partner shall promptly deliver to the requesting Limited Partner, at the expense of the',
Partnership, a copy of the information required to be maintained by Subsections (a), (b) or(d). Each appraisal, if
any,of the Property will be maintained by the General Partner and available for such inspection and examination by.
any Limited Partner or his duly authorized representative for a period of at least five years following the date of
acquisition of the Property.
10.2 Reports.The General Partner shall provide each Limited Partner with an annual report within 120
days of the end of the calendar year. Each report shall contain, except as otherwise indicated, unaudited financial
statements and a description of the status of payouts to the Limited Partners of their capital contributions. The
General Partner will use its best efforts to furnish to each Limited Partner by March 15 of each year a report
containing such information as is pertinent for tax purposes. The General Partner will also provide informal status
reports to Limited Partners periodically as deemed necessary by the General Partner or request by the Limited
Partners.
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10.3 Filings. The General Partner,at Partnership expense, shall cause the income tax returns for the
Partnership to be prepared and timely filed with the appropriate authorities. The General Partner, at Partnership
expense, shall also cause to be prepared and timely filed, with appropriate federal and state regulatory and
administrative bodies,all reports required to be filed with those entities under then current applicable laws,riles and
regulations. The reports shall be prepared on the accounting or reporting basis required by the regulatory bodies.
Any Limited Partner shall be provided with a copy of any of the reports and tax returns upon request without
expense to him
10.4 Fiscal Matters.
(a) Fiscal Year. The Partnership shall adopt a fiscal year beginning on the first day of
January of each year and ending on the last day of December of the same year;provided,however,.that the General
Partner in its sole discretion may,subject to approval by the internal Revenue Service and the applicable state taxing
authorities,at any time without the approval of the Limited Partners,change the Partnership's fiscal year to a period
to be determined by the General Partner.
(b) Method of Accounting.The General Partner shall determine the method of accounting
to be used for both income tax purposes and financial reporting purposes.
(c) Adjustment of Tax Basis. Upon the transfer of an interest in the Partnership, the
Partnership may, at the sole discretion of the General Partner,elect pursuant to Section 754 of the Internal Revenue
Code of 1986,as amended,to adjust the basis of the Partnership Property as allowed by Sections 734(b)and 743(b)
thereof.
ARTICLE 11
RIGHTS AND OBLIGATIONS OF THE LIMITED PARTNERS
11.1 Meetings.
(a) Place of Meedngs.Meetings of Partners may be held in such place as may be designated
by the Partners.
(b) Call of Meetings.Meetings of Limited Partners may be called by the General Partner or
by Limited Partners holding more than 10% of the outstanding Limited Partnership Interests. Meetings may be
called to enable the Limited Partners to vote on any of the matters subject to the vote of Limited Partners as set forth
in this Agreement.Partners may vote in person or by proxy.
(c) Meeting Procedures.Meetings shall be conducted and proceedings governed by the Act.
(d) Business Emergency.Notwithstanding any other provision hereof, in the event that the
General Partner and/or those Limited Partners who could authorize a Partnership action or decision at a duly called
meeting reasonably determine, in writing that the Partnership is facing a significant business emergency that
requires immediate action, then the necessary Partners, may, without complying with generally applicable
procedures for meetings or actions by consent,authorize any action or decision that they deem reasonably necessary
to allow the Partnership to benefit from a significant opportunity or to protect the Partnership from significant loss
or damage, provided that they make reasonable efforts under the circumstances to contact and consult all Partners
concerning such action or decision and the reasons why such action or decision must be made without observing
generally applicable procedures.
.11.2 Powers of Limited Partners. The Limited Partners may upon a vote or by written consent of
Limited Partners holding 51%of the outstanding Limited Partnership Interests obtained pursuant to the provisions of
this Article:
(a) Cancel any contract for services with the General Partner or any Affiliate without penalty
on 30 days notice;
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(b) Consent to any financing obtained by the Partnership and secured by the Project;
(c) Amend the Limited Partnership Agreement, subject to the limitations set forth in
Section 13.6;
(d) Disapprove a sale of the Partnership's Project proposed by the General Partner;
(e) Remove the General Partner as set forth in Section 12.2;
(f) Elect new general partner(s) or elect to continue the business of the Partnership upon the
occurrence of any of the events set forth in Section 14.1(a), (b) or(d); provided, however, that the admission of a
General Partner or an election to continue the business of the Partnership where a General Partner ceases to be a
General Partner other than by removal and where there is no remaining General,Partner, shall require the unanimous
vote of all Limited Partners; and
(g) Dissolve the Partnership.
(h) Approve any action by the Partnership in which the consent of the Limited Partners is
required under the terms of this Agreement.
Except as expressly set forth above or otherwise expressly provided for in this Agreement, the Limited
Partners shall have no other rights or powers which would otherwise bo permitted under the California Act.
11.3 Liability of Limited Partners.No Limited Partner shall be personally liable for any of the debts
of the Partnership or for any losses thereof beyond the amount of his Capital Contribution to the Partnership plus an
amount equal to his share of undistributed profits of the Partnership, if any. When a Limited Partner has received the
return in whole or in part of his Capital Contribution, he shall nevertheless.be liable to the Partnership for any sum,
not in excess of such return with interest, necessary to discharge its liability to all creditors who extended credit or
whose claims arose before such return. A Limited Partner is obligated to return a distribution from the Partnership to
the extent that(1) the Limited Partner had knowledge of the facts indicating the impropriety of the distribution, and.
(2) immediately after giving effect to the distribution, and notwithstanding the compromise of a claim referred to in
subdivision (c) of Section 15636 of the California Act, all liabilities of the Partnership, other than liabilities to
Partners on account of their interest in the Partnership and liabilities as to which recourse of creditors is limited to
specified property of the Partnership, exceed the fair value of the Partnership assets, provided that the fair value of
any property that is subject to a liability as to which recourse of creditors is so limited shall be included in the
Partnership assets only to the extent that the fair value of the property exceeds this liability.
11.4 Participation in Management. No Limited Partner shall participate in the management of the
business of, or transact any business for, the Partnership. Except as permitted by the California Act, no Limited
Partner shall be entitled to the return of his Capital Contribution.
11.5 No Agency. No Limited Partner shall have the power to represent, sign for, or bind the General
Partner or the Partnership.
11.6 Expenses of Limited Partners. The out-of-pocket expenses reasonably incurred by the Limited
Partners in connection with the acquisition of the Project and formation of the Partnership will be paid or reimbursed
by the Partnership.
11.7 Acknowledgment of Services.Each of the Limited Partners hereby acknowledges and agrees that
the General Partner's services to the Partnership are substantial and meaningful and involve the active management
and operation of the Partnership.
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ARTICLE 12
RESIGNATION OR REMOVAL OF THE GENERAL PARTNER
AND ASSIGNMENT BY THE GENERAL PARTNER
12.1 Resignation of General Partner. A General Partner may resign upon ninety (90) days notice to
the Partnership. On the resignation of a General Partner and upon the election of a new general partner, the interest
of the General Partner in the Net Income, Net Loss and Distributions from the Partnership shall be immediately
converted into a limited partnership interest in such items of Net Income,Net Loss and Distributions.
12.2 Removal of General Partner. A General Partner may be removed for any reason by the vote of
the Limited Partners in accordance with Sections 11.1 and 11.2. Written notice of the removal of the General Partner
shall be served upon it either by certified or registered mail, return receipt requested, or by personal service. The
notice shall set forth the grounds for removal and the date on which removal is to become effective. Upon removal
of the General Partner, the General Partner's interest in the Net Income, Net Loss and Distributions from the
Partnership shall be forfeited.
ARTICLE 13
ASSIGNMENT OF PARTNERSHIP INTEREST;
ADMISSION OF LIMITED PARTNERS;
AMENDMENT OF LIMITED PARTNERSHIP AGREEMENT
13.1 Assignment of Interests. A Partner may not assign}, transfer, encumber, pledge, hypothecate, or
sell ("Transfer") its Partnership Interest in whole or in part to any other person other than a Partner without the prior
written consent of all of the remaining Partners,which consent may be withheld for any reason.No assignee of all or
any part of the partnership interest shall become a substitute Limited Partner unless all of the Limited Partners shall
consent thereto, in writing, which consent shall be granted or withheld by the Limited Partners in its sole discretion,
and, in the event of such consent,it shall be effective only on the following conditions:
(a) The assignee shall consent in writing to be bound by the terms and conditions of this
Agreement in the place and stead of the assigning Partner;
(b) The assignee shall pay any expenses of the Partnership in effecting the substitution;
(c) All requirements of the California Act, shall have been completed by the assignee and the
Partnership;
(d) The assignment is effected in compliance with all applicable securities laws;and
(e) An opinion of counsel paid for by the transferring Partner, is provided confirming
compliance with all requirements of this Section.
13.2 Prohibited Transfers. Any purported transfer of any partnership interest held by a Partner that is
not permitted by Section 13.1 above shall be null and void and of no effect whatever; provided that, if the
Partnership is required to recognize a transfer that is not permitted(or if the Partnership, in its sole discretion, elects
to recognize a transfer that is not permitted), the interest transferred shall be strictly limited to the transferor's rights
to allocations and distributions as provided by this Agreement with respect to the transferred interest, which
allocations and distributions may be applied(without limiting any other legal or equitable rights of the Partnership)
to satisfy the debts, obligations, or liabilities for damages that the transferee of such interest may have to the
Partnership.
In the case of a transfer or attempted transfer of a partnership interest that is not permitted by Section 13.1
above, the parties engaging or attempting to engage in such transfer shall be liable to indemnify and hold harmless
the Partnership and the other Partners from all costs, liabilities, and damages that any of such indemnified Persons
may incur (including, without limitation, incremental tax liability and attorneys' fees and expenses) as a result of
such transfer or attempted transfer and efforts to enforce the indemnity granted hereby.
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13.3 Prohibition Against Tax Termination. Notwithstanding anything to the contrary herein
contained, no Partner shall be permitted to transfer all or any portion of his interest in the Partnership (except
involuntarily to his personal representative by operation of law) without the written consent of the General Partner
if, in the opinion of the tax advisors normally employed by the Partnership, it is more likely than not that such
transfer will terminate the Partnership for federal income tax purposes under Code Section 708(b)(1)(B). Any
Partner proposing to make a transfer otherwise permitted under this agreement, of all or any portion of his
Partnership interest shall give notice of the proposed transfer to the Partnership at least fifteen (15) business days
prior to the time of the proposed transfer. If, within such period, the Partnership does not obtain and deliver such an
opinion to the Partner proposing to make such transfer, the proposed transfer may be consummated in the manner
described in this Article 13. Any attempted transfer in violation of the conditions set forth herein shall be null and
void ab initio and the Partner making or attempting to make such a prohibited transfer shall indemnify and hold the
Partnership and each other Partner wholly and completely harmless from any costs, liabilities,or damages(including
any increases in their respective federal and state tax liabilities)resulting therefrom.
13.4 Payment of all Amounts Due With Respect to Transferred Interest. Notwithstanding any
provision hereof permitting the transfer of an interest in the Partnership, whether or not the transferee of such
interest is to be admitted to the Partnership as a substituted Partner with respect to the transferred interest, no interest
in the Partnership shall be transferred unless and until all debts and obligations of the transferor Partner to the
Partnership with respect to the transferred interest(including, without limitation, any due, but unpaid, contributions
under Article 6 hereof)have been paid. In the event of any transferor attempted transfer of an interest in violation of
this Section 13.4, in addition to any other remedies provided for by law of this Agreement, the Partnership shall be
entitled to satisfy its claims for any such due but unpaid amounts byeapplying to the balance thereof any amounts
otherwise distributable with respect to such interest.
13.5 Resignation of General Partner.
(a) The General Partner shall not withdraw or resign.from the Partnership without ninety
(90)days'notice thereof to the Limited Partners.
(b) In the event that the General Partner withdraws or resigns from the Partnership, such
General Partner shall be and shall remain liable for all obligations and liabilities incurred by the Partnership before
such withdrawal or resignation became effective, but, provided that such withdrawal or resignation was effected in
accordance with the terms of this Agreement, such General Partner shall be free of any obligation or liability
incurred on account of the activities of the Partnership from and after such withdrawal or resignation becomes
effective.
(c) Upon withdrawal or resignation of a General Partner and the election of a new General
Partner, the interest of the withdrawing or resigning General Partner in the Net Income, Net Loss and Distributions
from the Partnership shall be immediately converted into a limited partnership interest in such items of Net Income,
Net Loss and Distributions.
13.6 Amendments to Partnership Agreement. Except as provided by this Section 13.6 and Section
11.2, this Agreement may be modified or amended only by a vote of the Limited Partners holding fifty-one percent
(51%) or more of the Limited Partnership Interests conducted in accordance with Sections 11.1 and 11.2.
Notwithstanding anything to the contrary contained in this Agreement,this Agreement may not be amended without
the consent of all Partners to be adversely affected by an amendment that:
(a) Converts a Limited Partner into a General Partner;
(b) Modifies the limited liability of a Limited Partner;
(c) Alters the interest of a General Partner or Limited Partners in Net Income or Net Loss or
Distributions from the Partnership,except as set forth in Section 7.6 or Section 6.4;or
(d) Affects the status of the Partnership as a partnership for federal income tax purposes.
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ARTICLE 14
DISSOLUTION
14.1 Event of Termination.Subject to the right of the Limited Partners to continue the Partnership by
electing a successor general partner as hereinafter set forth in this Section 14.1, the Partnership shall continue to
exist for the term provided in Article 5 hereof, unless sooner dissolved by the happening of any of the following
events;
(a) The insolvency,bankruptcy or dissolution of the General Partner;
(b) The resignation of the General Partner, which shall be effective ninety (90) days after
written notice thereof to all Limited Partners;
(c) The vote to dissolve by the holders of a majority of the Limited Partners and by the
General Partner;
(d) The vote to remove the General Partner by the holders of fifty-one percent(51%) of the
Limited Partnership Interests;
(e) The continued conduct of the business of the Partnership becoming illegal;or
(f) The sale of the Project.
i
Upon the occurrence of any of the events set forth in subsections(a),(b)or(d)above,the Partnership may
be continued by a vote within 30 days of the effective date of such event by the Limited Partners pursuant to Section
11.1 hereof.-If a General Partner ceases to be a General Partner other than by removal and there is no remaining
General Partner, the Partnership shall dissolve unless all Limited Partners vote to continue the business of the
Partnership and to the admission of one or more new General Partner as provided for in Section 11.2.With regard to
the event set forth in subparagraph (b) above, the Partnership may be continued by a vote of the Limited Partners
prior to the occurrence of the effective date of such event pursuant to Section 11.1 hereof.
14.2 Winding Up.Except as prohibited by the provisions of the California Act, each Partner expressly
waives his right to dissolve the Partnership or obtain dissolution in any way other than as specified in this
Agreement. ,
14.3 Order of Distribution of Assets. In the event of dissolution as provided in Section 14.1 above,
the assets of the Partnership shall be distributed as follows;
(a) All of the Partnership's debts and liabilities to persons other than Partners shall be paid
and discharged;
(b) All of the Partnership's debts and liabilities to Partners shall be paid and discharged;
(c) The balance of the assets of the Partnership shall be distributed in accordance with the
Partners'Capital Accounts,which in general shall be as set forth in Section 7.2.
Upon dissolution,each Limited Partner shall look solely to the assets of the Parmcrship for the return of his
Capital Contribution, and if the Partnership Property remaining after the payment or discharge of the debts and
liabilities of the Partnership is insufficient to return the Capital Contribution of each Limited Partner, such Limited
Partner.shall have no recourse against the General Partner or any other Limited Partner. The winding-up of the
affairs of the Partnership and the distribution of its assets shall be conducted exclusively by the General Partner.
They are hereby authorized to do any and all acts and things authorized by law for these purposes. In the event of
insolvency,dissolution,bankruptcy or resignation of all of the General Partner or removal of the General Partner by
the Limited Partners, the winding up of the affairs of the Partnership and the distribution of its assets shall be
conducted by such person or entity as may be selected by a vote of the Limited Partners holding fifty-one percent
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(51%)of the outstanding Limited Partnership Interests, which person or entity is hereby authorized to do any and all
acts and things authorized by law for such purposes.
.14.4 Compliance With Timing Requirements of Regulations. In the event the Partnership is
"liquidated"within the meaning of Treasury Regulation Section 1.704-1(b)(2)(ii)(g), (a) distributions shall be made
pursuant to this Article 14 (if such liquidation constitutes a dissolution of the Partnership) or Article 7 hereof(if it
does not) to the General Partner and Limited Partners who have positive Capital Accounts in compliance with
Treasury Regulation Section 1.704-1(b)(2)(ii)(b)(2), and (b) if the General Partner's Capital Account has a deficit
balance(after giving effect to all contributions, distributions, and allocations for all taxable years, including the year
during which such liquidation occurs), the General Partner shall contribute to the capital of the Partnership an
amount equal to the lesser of(i) the Capital Account Deficit in the General Partner's Capital Account, or (ii) the
excess of 1.01% of the capital contributions made by the Limited Partners over the amount of capital previously
contributed by the General Partner. The General Partner's obligation to contribute capital is an obligation to the
Limited Partners only and shall not be enforceable by any other party. If a Limited Partner has a deficit balance in
his Capital Account(after giving effect to all contributions, distributions-and allocations for all taxable years), such
Limited Partner shall have no obligation to any contribution to the capital of the Partnership with respect to such
deficit and such deficit shall not be deemed a debt owed by the Partnership or any Partnership creditor. Distributions
pursuant to the preceding sentence may be distributed to a trust established for the benefit of the General Partner and
Limited Partners for the purposes of liquidating Partnership assets,collecting amounts owed to the Partnership, and
paying any contingent or unforeseen liabilities or obligations of the Partnership or the General Partner arising out of
or in connection with the Partnership. The assets of any such trust shall be distributed to the General Partner and
Limited Partners from time to time, in the reasonable discretion of)he General Partner, in the same proportions as
the amount distributed to such trust by the Partnership would otherwise have been distributed to the General Partner
and Limited Partners pursuant to this Agreement.
14.5 Distributions in Kind. Distributions in liquidation may be made in cash or in kind. In the event
its distributions in liquidation are made totally or partially in kind, the value of a Partnership's assets, and the
Limited Partners' and General Partner's interest in the Partnership shall be evaluated by the Partnership's
independent accounting firm and an independent real estate appraisal firm selected by the General Partner.
Distributions of cash and of the assets to be distributed in kind shall each be made to the General Partner and to the
Limited Partners in the ratio that the value of their interests, both capital and profits, in the Partnership bears to the
value of the Partnership's assets.
ARTICLE 15
ARBITRATION
15.1 Arbitration.
(a) General; Appointment of Arbitrators; and Discovery.
(i) Except as otherwise specifically provided in this subparagraph (i), if any
controversy or dispute between the parties hereto arises under, out of, or in relation to any of the provisions hereof,
including any claim under federal or state securities laws which cannot be settled by the parties within fifteen (15)
days after a party hereto gives written notice of the existence of such dispute, any party, within thirty(30) days of
the expiration of the foregoing fifteen(15)day period,may submit such controversy or dispute for arbitration to, and
in accordance with the Rules of Practice and Procedure for the Judicial Arbitration & Mediation Services, Inc.
("J.A.M.S.") (J.A.M.S. and their agents are referred to herein as the "Arbitrators"), as then in effect, except as
otherwise provided by the provisions of this Paragraph 15.1(a)(i).
(ii) The provisions of this Paragraph 15.1(a)(ii) shall not be construed to deny any
party the right to seek provisional remedies available to said party before a court of law. For the purposes of this
Agreement, the parties, by submitting the controversy or dispute to the Arbitrators, do not waive or relinquish their
rights to seek provisional remedies before a court of law and said parties expressly agree that each party shall have
the right to seek provisional remedies before a court of law.
_18-
DRAFT 09/04/98
181938-2
(iii) If no party elects to submit a controversy to arbitration within the aforesaid
thirty(30)day period, then any party shall have the right to commence legal proceedings to resolve the controversy;
provided, however, such party must first give written notice to the other parties of its intent to commence litigation
and the parties receiving such notice shall have fifteen (15) days following the date of receipt of such notice to
submit the controversy to arbitration in accordance with the foregoing provisions of this Paragraph 15.1(a)(iii). If no
party, after receiving such notice,submits the controversy to arbitration within such fifteen(15)day period, the right
to arbitrate such noticed dispute shall be waived and then the party giving the notice shall have the right to
commence legal proceedings to resolve the controversy without further notice or further obligation to comply with
the provisions of this Paragraph 15.1(a)(iii) with respect to that particular controversy. For the purposes of this
Agreement,the time within which any arbitration proceedings can be instituted with respect to any matter or dispute
shall be deemed to have elapsed only upon the expiration of the aforesaid fiReen (15) day period following the
receipt of such a notice of intent to commence legal proceedings. If a party refuses to submit to arbitration after duly
given notice of the other parties exercise of his/her right to arbitrate, the other parties shall be entitled to an order
from the appropriate court compelling arbitration. If any party commences legal proceedings (and the other parties
do not successfully compel arbitration) to resolve the controversy as specifically provided in this subparagraph(iii),
the parties hereto shall stipulate immediately upon the setting of a trial date, pursuant to California Rule of Court
244, or any successor amended statute or law containing similar provisions, that the proceeding be tried by a
temporary judge.
(iv) The provisions of California Code of Civil Procedure governing discovery in
civil litigation, or any successor amended statute or law containing similar provisions, are incorporated by reference
herein and shall apply in any such arbitration; specifically, the parties shall have the right to engage in all pre-
hearing discovery as that which would be permitted in a civil litigation action to resolve their dispute.The Arbitrator
shall rule upon motions to compel or limit discovery and shall have the authority to impose sanctions, including
attorneys' fees and costs, to the same extent as a court of law, should the Arbitrator determine that discovery was
sought without substantial justification or that discovery was refused or objected to without substantial justification.
The parties shall have a certified court reporter make a record of the hearing. The arbitration shall proceed in
accordance with the laws relating to arbitration then in effect in the State of California, including, but not limited to
Sections 1280 through 1294.2 of the California Code of Civil Procedure,as the same may be amended or superseded
from time to time.
(b) Final Judgment,Findings of Fact and Conclusions.
(i) The Arbitrator shall apply California law as though he/she was bound by
applicable statutes and precedents and case law, including the admissibility of evidence and shall endeavor to decide
the controversy as though he/she were a judge in a California court of law. The Arbitrator shall have the power to
issue any award,judgment, decree or order of relief that a court of law or equity could issue under California law,
including,but not limited to,money damages,specific performance,or injunctive relief; and for such purposes, it is
hereby expressly acknowledged and agreed that damages at law will be an inadequate remedy for a breach or
threatened breach of any provision of this Agreement, it being the intention of this sentence to make clear the
agreement of the parties that the respective rights and obligations of the parties hereunder shall be enforceable in any
arbitration proceedings in accordance with principles of equity as well as law.
(ii) The Arbitrator shall prepare a written decision that shall be supported by written
findings of fact and conclusions which adequately set forth the basis of his/her decision and which cite the statutes
and precedents applied and relied upon in reaching his/her decision. The award,judgment, decree or order, and the
findings of the Arbitrator shall be final, conclusive and binding upon the parties, and judgment upon the award and
enforcement of any other judgment, decree or order of relief granted by the Arbitrator may be entered or obtained in
any court of competent jurisdiction upon the application of any party. This agreement to arbitrate shall be self-
executing without the necessity of filing any action in any court and shall be specifically enforceable under the
prevailing arbitration law.
(c) Costs and Expenses. Except as otherwise provided in subsection (a)(iv) of this
Paragraph 15.1 in the provisions related to discovery,all costs and expenses of any arbitration proceeding hereunder,
excluding attorneys' fees, shall be shared equally by the parties.'Each party shall bear its own attorneys' fees.
Notwithstanding the foregoing, however, in the event the Arbitrator shall determine that a party acted without
-19-
DRAFT 09/04/98
181938-2
substantial justification in submitting to a dispute to arbitration, the party who is so determined to be acting without
substantial justification shall bear all costs and expenses of the other party in the proceeding including, but not
limited to,the reasonable attorneys'fees of such other party.The parties hereto expressly agree that the provisions of
California Code of Civil Procedure,including,but not limited to,Section 998 et seq., as the same may be amended
or superseded from time to time, governing offers by a party to compromise shall not apply to any arbitration
proceeding hereunder.
ARTICLE 16
MISCELLANEOUS PROVISIONS
16.1 Notices.Any notice,payment,demand or communication required or permitted to be given by any
provision of this Agreement shall be deemed to have been sufficiently given or served for all purposes if delivered
personally to the party or to an officer of the party to whom the same is directed or if sent by registered or certified
mail,postage and charges prepaid,addressed as follows:
General Partner:
THE BRIDGES AMERICA FOUNDATION
222 Emile Street
Houston,TX 77020
Attn:Mr.Garrett Robinson
Evans:
Mr.Kirk S.Evans
9281 Shadwell Drive
Huntington Beach,CA 92646
Geller:
Mr.Billy G.Geller
18837 Brookhurst Street,Suite 303
Fountain Valley,CA 92708
Properties:
B.J.P.PROPERTIES,INC.
27025 Calle Del Cid
Mission Viejo,CA 92691
Attn:Mr.Steve Perry
Any party may change the address at which notice is to be given by written notice to the other party.
16.2 Application of California Law; Venue. This Agreement and the application or interpretation
thereof shall be governed,construed,and enforced exclusively by its terms and by the law of the State of California
and the appropriate Courts in the County of Long Beach,State of California shall be the only appropriate forum for:
any litigation arising hereunder.
16.3 Eseeution In Counterparts. This Agreement may be executed in any number of counterparts.
with the same effect as if all parties hereto had all signed the same document. All counterparts shall be construed:
together and shall constitute one agreement.
16.4 Additional Documents and Acts. Each Limited Partner agrees to execute and deliver such
additional documents and instruments and to perform such additional acts as may be determined by the General
Partner to be necessary or appropriate to effectuate,carry out and perform all of the terms,provisions and conditions
of this Agreement and the transactions contemplated hereby.
-20-
DRAFT 09/04/98
151938-2
16.5 Waiver of Action for Partition. Each of the parties hereto irrevocably waives during the term of
the Partnership any right that it may have to maintain any action for partition with respect to the Property of the
Partnership.
16.6 Assignability. Each and all of the covenants, terms, provisions and agreements herein contained
shall be binding upon and inure to the benefit of the successors and assigns of the respective parties hereto, subject
to the requirements of Article 13.
16.7 Captions. Paragraph titles or captions contained in this Partnership Agreement are inserted only
as a matter of convenience and for reference. The titles and captions in no way define, limit, extend or describe the
scope of this Agreement nor the intent of any provision hereof.
16.8 Not for Benefit of Creditors. The provisions of this Agreement are intended only for the
regulation of relations among Partners, putative Partners and the Partnership.This Agreement is not intended for the
benefit of non-Partner creditors and does not grant any rights to non-Partner creditors.
16.9 Severability. If any sentence or paragraph of this Agreement is declared by a court of competent
jurisdiction to be void,the sentence or paragraph shall be deemed severed from the remainder of the Agreement and
the balance of the Agreement shall remain in effect.
.1h
IN WITNESS WHEREOF, the undersigned have executed this Agreement this day of September,
1998. /
GENERAL PARTNER:
THE�BRIDGES AMERICA FOUNDATION
A Delaware Nonprofit Corporation
By
l All
Its: " �l
LIMITED PARTNERS:
Kirk S. Evans
u'
Billy G. G Iler
B.J.P. PROPERTIES, INC.,
A Texas Corporation
By:
Its: !-d/
-21-
DRAFT 09/04/98
p .'s;�vfi'1rs3t
{
RCA KOUTING AiEET.'
INITIATING DEPARTMENT: Planning
SUBJECT: Agreement Containing Covenants between the City-and
Bridges America Foundation, L.P.
COUNCIL MEETING DATE: October 16, 2000
RCA ATTACHMENTS STATUS
Ordinance (w/exhibits & leg islative.draft if applicable) Not Applicable
Resolution (w/exhibits & legislative draft if applicable) Not Applicable
Tract Map, Location Map and/or other Exhibits Not Applicable
Contract/Agreement (w/exhibits if applicable)
(Signed in full by the City Attorney) Attached
Subleases, Third Party Agreements, etc.
(Approved as to form by City Attorney) Not Applicable
Certificates of Insurance (Approved by the City Attorney) Not Applicable
Financial Impact Statement (Unbudget, over $5,000) Not Applicable
Bonds (If applicable) Not Applicable
Staff Report (If applicable) Not Applicable
Commission, Board or Committee Report (If applicable) Not Applicable
Findings/Conditions for Approval and/or Denial Attached
.
EXPLANATION FOR MISSING ATTACHMENTS
is
REVI WED RETURNED FORWARDEDA
.
Administrative Staff 146
Assistant City Admini rator (Initial) ( ) ( )
City Administrator (Initial) ( ) ( a0wo )
City Clerk ( )
EXPLANATIOW FOR RETURN OF ITEM.
.... .
,
SpaceOnly)
RCA Author: HZ:SH:MBB:kjl
�or��y�
la
ue
CITY OF HUNTINGTON BEACH
INTER-DEPARTMENT COMMUNICATION
HUNTINGTON BEACH
DATE: May 17, 2000
TO: Paul D'Alessandro, Assistant City Attorney _
FROM: Connie Brockway, City Clerk
RE: Affordable Housing Agreement— Bridges America
I have indicated my requested revisions to the second version of the Affordable Housings.
Agreement which you provided to me.
The inclusion of the words Revised and Restated Agreement reflects that there is currently an
agreement entered into between the Council and developer, which is not the case. Past <"
agreements with said wording are based on an original agreement that is being revised and
restated. In this instance there is no such agreement. x
TM,
Should the Clerk's office be subpoenaed to produce all records related to this affordable .--5.. .
housing agreement, doubt would be cast on the integrity of the City Clerk's record of Council
-Action, as the agreement referred to as being revised and restated does not exist. YS
The 1996 document was recorded by the developer without the knowledge of the City Clerk's
Office. If you will refer to Page No. 7 of the recorded instrument it will show that when this = =•
document was given to me by staff to sign in 1996 1 deleted the Clerk's.attestation so that it
could not be recorded until presentation to and approval by Council as agreed upon by staff and
the City Clerks Office. Yet, it was nevertheless recorded, purportedly at the Clerks request
(note upper left corner of instrument). . I understand errors occur, however, the agreement now = y.
being presented to Council is the original agreement, not a revised and restated agreement.
Your review of the attached revisions is appreciated.
'
proposed PPrec
Connie Brockway r
City Clerk `-
CB:mp k
Cc: Mary Beth Broeren, Senior Planner sr
Attachments: Affordable Housing Agreement Exhibit°B"
City Clerk's memorandum to City Attorney & .
City Councilmembers dated April 26, 2000
.
G:\Cbmemos\2000Cbmem\Affordab1e Housing Agree-Bridges America.doc-mp c `'
.f • .ter -�
ORANGE COAST TITLE
Recorded in the county of Orange, California
RECORDING REQUESTED BY Gary L. Granville, Clerk/Recorder
AND WHEN RECORDED MAIL TO: 1111111111111111111111111111111111111111111111111111111Illillllll No Fee
City of Huntington Beach 005 10003741 10 31 19960029682 3:31pm 01/19/96
20W Main Street A 12 16 7.00 45.00 0.00 0.00 0.00 0.00
Huntington Beach, CA 92648
Attn: City Clerk )
(Space above for recorder)
This Agreement is recorded at the k
request and for the benefit of the
City of Huntington Beach and is
s
exempt from the payment of fees
pursuant to Government Code
Section 6103.
ry�
AGREEMENT CONTAINING COVENANTS AFFECTING REAL PROPERTY
THIS AGREEMENT CONTAINING COVENANTS AFFECTING REAL PROPERTY
�\ (the "Agreement") is entered into this 1 y t1i day of 74 wu 4A r , 19961 by and between the
CITY OF HUNTINGTON BEACH, a municipal corporation ("City"), and THE BRIDGES
AMERICA FOUNDATION, L.P., a California limited partnership ("Owner").
RECITALS:
A. Owner is fee owner of record of that certain real property (the "Site") located in
the City of Huntington Beach, County of Orange, State of California legally described in the
attached Exhibit "A." There are currently twenty (20) 4-plexes with a total of eighty (80) multi-
family apartment units located on the Site.
B. On February 28, 1995, the Planning Commission of City approved Tentative Tract
Map No. 15109 and Conditional Use Permit No. 94-40 which authorized the subdivision of
certain real property currently being acquired by The CenterStone Company located generally
on the east side of Beach Boulevard, 400 feet south of Adams Avenue, and the development on
said real property of thirty (30) detached residential units (the "CenterStone Project").
On March 6, 1995, the City Council of City approved Tentative Tract Map No. 15033 and
Conditional Use Permit No. 94-29 which authorized the subdivision of certarn real property
currently being acquired by Greystone Homes, Inc., and located generally on the west side of
Beach Boulevard between Memphis Avenue and Knoxville Street, and the development on said
real property of sixty-nine (69) single-family residential units '(the "Greystone Project").
On June 13, 1995, the Planning Commission of City approved Tentative Tract Map
FS2\112\016271-=1\2147029.7 s09/15/95
No. 14515(R) and Site Plan Amendment No. 94-2 which authorized the subdivision of certain
real property currently being acquired by the Presley Companies and located at 9800 Yorktown
Avenue(the closed Bushard School site) and the development on said real property of fifty-eight
(58) single-family residential units; also on June 13, 1995, the Planning Commission of City
approved Tentative Tract Map No. 14990 and Conditional Use Permit No. 94-26 for the
subdivision of certain real property currently being acquired by Presley Companies located at
the southeast corner of Cumberland Drive and Victoria Lane (the closed Gill School site) and
the development on said real property of fifty-eight (58) single-family residential units
(collectively, the "Presley Projects"). City imposed conditions of approval on the CenterStone
Project, the Greystone Project, and the Presley Projects requiring the developers of such projects
to provide a specified number of affordable housing units in conjunction with the new develop-
ments.
C. Owner has entered into agreements with the developers of the CenterStone
Project, the Greystone Project, and the Presley Projects to satisfy such developers' affordable
housing obligations by providing affordable housing within twenty-two (22) of the existing
residential dwelling units on the Site (the "Affordable Units").
NOW, THEREFORE, BASED UPON THE FOREGOING RECITALS AND FOR
GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND SUFFICIENCY OF
WHICH IS ACKNOWLEDGED BY BOTH PARTIES, CITY AND OWNER AGREE AS
FOLLOWS:
I. AFFORDABLE HOUSING
(A) Number of Units. Owner agrees to make available, restrict occupancy to,
and lease the twenty-two (22) Affordable Units on the Site to "Lower Income Households" at
an "Affordable Rent" for the duration of the "Affordability Period" (as those terms are defined
hereinbelow). Nothing in this Agreement shall restrict Owner's right to select which of the
eighty (80) rental housing units on the Site shall be the Affordable Units and Owner may at its
option change the location of the Affordable Units on the Site from time to time, provided that
a minimum of twenty-two(22) rental housing units shall be restricted as Affordable Units during
the entire Affordability Period.
As used in this Agreement, the term "Lower Income Household" shall mean
persons and families whose income does not exceed eighty percent (80%) of Orange County
median income, adjusted for family size, as determined by the United States Department of
Housing and Urban Development, as set forth in Health and Safety Code Section 50079.5.
As used in this Agreement, the term "Affordable Rent" shall have the meaning
set forth in Section I(D) hereinbelow.
As used in this Agreement, the term "Tenant" shall mean any person who rents
or leases any portion of the Site or any person who is not a fee or equitable owner of any
portion of the Site who uses the Site as his or her principal residence. For purposes of this
Agreement, principal residence will be determined in the same manner as principal residence
is determined for state residency under California Vehicle Code Section 516.
FS211121016271-00M2147029.6 a08/17/95 -2-
(B) Duration of Affordability-Requirements. The Affordable Units shall be
subject to the requirements of this Agreement from the date of this Agreement until the date that
is thirty (30) years from the date the twenty-second (22nd) Affordable Unit has been rented to
a Lower Income Household. City acknowledges that the residential dwelling units on the Site
are occupied as of the date this Agreement and that the requirements of this Agreement will be
enforced by Owner as units are vacated and become available for rental to eligible households
in the ordinary course of business'. The duration of this requirement shall be known as the
"Affordability Period."
As soon as the twenty-second (22nd) Affordable Unit has been rented to a Lower
Income Household pursuant to this Agreement, City and Owner shall cooperate in the recorda-
tion of a supplemental Memorandum confirming the expiration date of the Affordability Period.
The form of the supplemental Memorandum is attached hereto as Exhibit "B."
(C) Income of Tenant. After the lease of any Affordable Unit to a Tenant,
Owner shall submit to City a completed income computation and certification form, in such form
as is generally used by City in administering its affordable housing program from time to time.
Owner shall certify that to the best of its knowledge each Tenant of an Affordable Unit is a
Lower Income Household and meets the eligibility requirements established for the particular
Affordable Unit occupied by such household. Owner shall obtain an income certification from
each Tenant of an Affordable Unit and shall certify that, to the best of Owner's knowledge, the
income of the Tenant is truthfully set forth in the income certification form. Owner shall verify
the income certification of the Tenant in one or more of the following methods as specifically
requested by City:
(1) Obtain two (2) paycheck stubs from the Tenant's two (2) most
recent pay periods.
(2) Obtain a true copy of an income tax return from the Tenant for the
most recent tax year in which a return was filed.
(3) Obtain an income verification certification from the employer of
the Tenant.
(4) Obtain an income verification certification from the Social Security
Administration and/or the California Department of Social Services if the Tenant receives
assistance from such agencies.
(5) Obtain an alternate form of income verification reasonably requested
by City, if none of the above forms of verification is available to Owner.
If, after renting an Affordable Unit to an eligible household, the household's
income increases above the income level permitted for that unit, the household shall continue
to be permitted to reside in such Affordable Unit. Subsequently, however, when the next
residential rental unit on the Site becomes vacant and available for rent, the vacant unit shall
become an Affordable Unit subject to the restrictions of this Agreement (and subject to Owner's
FS2\112\016271-0001\2147029.6 a08/17/95 -3-
retained discretion to change the location of Affordable Units from time to time, as provided in
Section I(A) herein).
(D) Determination of Affordable Rent for the Affordable Units. The maximum
monthly rental payment ("Affordable Rent") amount for the Affordable Units required to be
leased to Lower Income Households shall be established at thirty-five percent (35%) times
seventy-nine percent(79%) of the monthly area median income for a household of four persons.
The Affordable Rent amount for the Affordable Units shall be adjusted annually
by the formula set forth above upon the publication of revised Orange County median income
figures by the United States Department of Housing and Urban Development.
OWNER UNDERSTANDS AND KNOWINGLY AGREES THAT THE
MA)MAUM RENTAL PAYMENTS TO BE ESTABLISHED BY THIS FORMULA ARE NOT
NECESSARILY EQUAL TO THE FAIR MARKET RENT FOR THE AFFORDABLE UNITS,
AND MAY BE ESTABLISHED AT A LEVEL SUBSTANTIALLY BELOW THE FAIR
MARKET RENT LEVELS.
OWNER HEREBY AG ES TO RESTRICT THE AFFORDABLE UNITS
ACCORDINGLY.
O ner's initials
(E) Annual Report Within sixty (60)days after the end of each calendar year
during the Affordability Period, Owner shall submit to City a report verifying Owner's
compliance with the provisions of Section I(A)-(D) of this Agreement. Owner's final annual
report shall be submitted to City within sixty (60) days after the end of the Affordability Period.
Each annual report shall identify the number and location of the Affordable Units for the appli-
cable reporting period, the identity of each Tenant occupying an Affordable Unit during any
portion of such period, the income and family size of each such Tenant, the Affordable Rent for
each of the Affordable Units, and the actual contract rent actually charged. If City prescribes
a particular form to be utilized by Owner in preparing the annual report,Owner shall utilize said
form, provided that it complies substantially with the foregoing requirements.
Il. NON-DISCRIMINATION.
Owner, on behalf of itself and its successors, assigns, and each successor in
interest to the Site or. any part thereof, hereby further covenants and agrees during the
Affordability Period:
(A) Not to discriminate upon the basis of sex, marital status, race, color,
creed, religion, national origin, or ancestry in the sale, lease, sublease, transfer or rental, or'in
the use, occupancy, tenure, or enjoyment of any of the Affordable Units on the Site. Each and
every lease and contract entered into with respect to any of the Affordable Units on the Site
during the Affordability Period shall contain or be subject to substantially the following
nondiscrimination or nonsegregation clauses:
FSZi11Z1016271-00011Z147029.6 &W/17M -4-
In leases: "The lessee herein covenants by and for itself, its successors and
assigns, and all persons claiming under or through them, and this lease is made and accepted
upon and subject to the following conditions:
That there shall be no discrimination against or segregation of any person or group
of persons on account of sex, marital status, race, color, creed, religion, national origin, or
ancestry, in the leasing, renting, subleasing, transferring, use, occupancy, tenure, or enjoyment
of the land herein leased, nor shall the lessee itself, or any other person claiming under or
through it, establish or permit such practices of discrimination or segregation with reference to
the selection, location, number, use, or occupancy of tenants, lessees, sublessees, subtenants,
or vendees in the land herein leased."
In contracts: "There shall be no discrimination against or segregation of any
persons or group of persons on account of sex, marital status, race, color, creed, religion,
national origin, or ancestry in the sale, lease, rental, sublease, transfer, use, occupancy, tenure,
or enjoyment of the land, nor shall the transferee itself or any person claiming un der or through
it, establish or permit any such practice or practices of discrimination or segregation with
reference to the selection, location, number, use, or occupancy of tenants, lessees, subtenants,
sublessees, or vendees of the land."
III. USE RESTRICTIONS
During the Affordability Period, Owner shall be required to take all reasonable
steps necessary to ensure that each Tenant of an Affordable Unit and all assignees and trans-
ferees of such Tenant have knowledge of all terms and conditions of this Agreement by including
in each and every lease and rental agreement a clause which incorporates this Agreement by
reference and makes this Agreement a part of an attachment to such lease or rental agreement.
In addition, during the Affordability Period, each lease for any of the Affordable Units on the
Site shall contain provisions that the Affordable Unit shall be occupied, used, and maintained
as follows:
(A) the dwelling unit shall be used only for private dwelling purposes, with
appurtenant facilities, and for no other purposes;
(B) the Tenant shall not permit or suffer anything to be done or kept upon the
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 reasonable noises or otherwise, nor shall any Tenant commit
or permit any nuisance on the premises or fiil to keep the premises free of rubbish, clippings,
and trash or commit or suffer any illegal act to be committed thereon;
(C) the Tenant shall comply with all of the lawful requirements of all
governmental authorities with respect to the premises;
(D) 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 City;
F=112\016271-0001\2147029.6 a08/17195 -5-
(E) no person shall be permitted to occupy the premises for transient or hotel
purposes; and
(F) the Tenant shall comply in all respects with this Agreement and any failure
by the Tenant to comply with the terms of this Agreement shall be a default under the Tenant's
lease.
IV. APPLICABLE LAW
(A) If any provision of this Agreement or portion thereof, or the application
to any person or circumstances, shall to any extent be held invalid, inoperative, or unenforce-
able, the remainder of this Agreement, or the application of such provision or portion thereof
to any other persons or circumstances, shall not be affected thereby; it shall not be deemed that
any such invalid provision affects the consideration for this Agreement; and each provision of
this Agreement shall be valid and enforceable to the fullest extent permitted by law.
(B) This Agreement shall be construed in accordance with the laws of the State
of California.
V. MISCELLANEOUS
(A) Satisfaction of Affordable Housing Obligations of CenterStone Project.
Greystone Project. and Presley Projects. By its approval and execution of this Agreement,
City acknowledges that upon the recordation of this Agreement against the Site, Owner shall
have assumed the obligations of the CenterStone Project, the Greystone Project, and the Presley
Projects to provide affordable housing, that the owners/developers of those other projects
thereafter shall be released from the obligations to provide affordable housing as stated in the
conditions of approval for such projects, and that thereafter City shall look solely and exclusively
to Owner and the Site for satisfaction of such affordable housing obligations. The owners/
developers of the CenterStone Project, the Greystone Project, and the Presley Projects shall be
third party beneficiaries of this Agreement to the extent necessary to enforce their respective
interests in this Section V(A), and this Agreement shall not be modified, amended, or terminated
in any manner which affects the CenterStone Project, the Greystone Project, or the Presley
Projects, or the respective interests of the owners/developers thereof, without the prior written
consent of the affected owner/developer(s), which consent may be withheld in such owner/
developer's sole and absolute discretion.
(B) Binding on Successors and Assigns. The covenants and agreements
established in this Agreement shall, without regard to technical classification and designation,
be binding on Owner and any successor to Owner's right, title, and interest in and to all or any
portion of the Site, for the benefit of and in favor of the City of Huntington Beach. All the
covenants contained in this Agreement shall remain in effect for the Affordability Period, and
shall automatically terminate and be of no further force or effect after such time. Upon expira-
tion of the Affordability Period, City agrees to cooperate with Owner, at no cost to City, in
removing this Agreement of record from the Site.
FS2UM016271-0001N2147029.6 a08/17/95 -6-
(C) Subordination to Trust Deeds. Notwithstanding any other provision in this
Agreement to the contrary, the covenants and agreements established in this Agreement at all
times shall be junior and subordinate to the lien of any mortgage or deed of trust recorded by
or on behalf of a lender to secure a loan for the acquisition or improvement of the Site,
including without limitation any deed of trust recorded concurrently herewith. City agrees, at
no expense to City, to execute such documents as may be reasonably requested by Owner, any
successor or assign to Owner's right, title, and interest in and to all or any portion of the Site,
or any lender of any such person subordinating City's rights and interest under this Agreement
to the lien of any trust deed recorded or to be recorded by a lender securing a loan for the
acquisition or improvement of the Site. . Owner, Owner's successor or assign, or the benefitted
lender shall be responsible for preparing the document(s) creating such subordination of City's
interest.
IN WITNESS WHEREOF, City and Owner have executed this Agreement Containing
Covenants Affecting Real Property to be effective as of the date first written above.
CITY OF HUNTINGTON BEACH,
a municipal corporation
Dated:
Director of C mmunity Development
ATTEST:
Clerk
APPROVED AS TO FORM:
ty attorney PIS
AZWp-f S
3 THE BRIDGES AMERICA FOUNDATION, L.P.,
a California limited partnership
By: The Bridges America Foundation,
a Delaware corporation
Dated: �� g y: Z
Common eaith of Vir inia. City/Cou ri`y of
Ackr:(,vvi-dged a Sworn
n
P�i;y Commission E),pires
FS2\112\016271-=1\2147029.7 a09/15/95 —7—
CALIFORNIA ALL-PURPSIE ACKNOWLEDGMENT
State of
County of
On��`1,9s before me, 1Z�'�� IZ12 V .61,C_
Date Name and Title of Officer( Ja ere Doe,NoNotary Public)
personally appeared _ ��ahie s. Zl/G/1
Name(s)of Signer(s)
❑personally known to me—OR—9proved to me on the basis of satisfactory evidence to be the person(s)
whose names) islaxe subscribed to the within instrument
and acknowledged to me that ire/she/th" executed the
same in#is/herAftitr authorized capacity(fes),and that by
his/her/their signature{a)on the instrument the person(s),
or the entity upon behalf of which the persons) acted,
executed the instrument.
ELIZABETH EHRING
�.,.~ COMM.#I OD3397 z
Z . Notary Public—Caefomia WITNESS my hand and official seal.
"'�
Z " ORANGE COUNTY
My Comm.Expires AUG 29.1997. `-o
aZ2�2a�, 4_e�'
Signature of Notaryd5ublic
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 of this form to another document.
Description of Attached Document
Title or Type of Document: ''E=/'���
Document Date: ��/9� Number of Pages. �6
Signer(s) Other Than Named Above/✓yr2 e b aer' i7ckh� Ae go P
Capacity(ies),,��CAAlaimed by Signer(s)
Signer's Name:A10_k,hi� S� ���� Signer's Name:
❑ Individual ❑ Individual
51 Corporate-Officer ❑ Corporate Officer
Title(s): ir- Title(s):
❑ Partner—❑ Limited ❑ OWneral ❑ 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 thumb here
Signer Is Representing: Signer Is Representing:
G t
0 1994 National Notary Association•8236 Remmet Ave.,P.O.Box 7184•Canoga Park,CA 91309.7184 Prod.No.5907 Reorder.Call Toll-Free 1.800-876-6827
STATE OF G GGIRNIA ti/�lN
ss.
OF
GMbtff-Y'
wrey
On lG�9 before me, gtceftu (,t� lc/+�t� , personally
appeared A-e l o i e—
personally known to me (or proved to me on the basis of satisfactory evidence) to be the
person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s) or the entity upon behalf of which the person(s)
acted, executed the instrument.
Witness my hand and official seal.
Notary Pub
[SEAL] My t�.l3oG.. ...
_STATE OF CALIFORNIA )
ss.
COUNTY OF )
On before me, personally
appeared
personally known to me (or proved to me on the basis of satisfactory evidence) to be the
person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s) or the entity upon behalf of which the person(s)
acted, executed the instrument.
Witness my hand and official seal.
Notary Public
[SEAL]
FS21112\016271-OMM147029.6 a08117/95 —8—
• EXHIBIT "A"
10
LEGAL DESCRIPTION OF THE SITE
THAT PCRTICN OF THE WEST 10 ACRES OF THE SCUM HALF OF THE SCATTH HALF OF THE
SOUrrMST 93 RM OF SELMCN 23, MWMUP.5 SOUTH, RANGE 11 WEST, IN THE RANCHO
LA BOLSA CHICA, AS SHOWN ON A MAP RECORDED IN BOOK 51, PACE 13, OF MISCELLANEOUS
MAPS, RFClOFRDS OF SAID COUNTY, DESCRIBED AS FOLUMS:
BDGMUNZ; AS THE NORTHEAST CORNER OF SAID WEST 10 ACRES; THENCE SOUTH 340.00
FEET; THENCE WEST 640.00 FEET PARALLEL WITH THE NORTH LINE OF SAID VEST 10 ACRES
TO THE EAST LINE OF THE RIGHT-OF-WAY OF THE SOMY ERN PACIFIC RAILWAY; THENCE
NORTH 340.00 FEET AILM SAID EAST LIM TO THE NORTH LINE OF SAID WEST 10 ACRES;
THE NKE EAST 640.00 FEET TO THE POINT OF BEGnUING.
EXCEPTING THEREFRC M THAT PORTION THEREOF INC UDED WITHIN THE WESTERLY 570.00 FEET
OF THE SOUTH 100.00 FEET OF THE NORTH 340.00 FEET OF THE SOUTH HALF OF THE SOUTH
HALF OF THE SOUTHEAST QUARTER OF SAID SECTION 23.
ALSO EXCEPTING ALL OIL, GAS, HYDROMUKUS, AND MUM NRERAL SU19DWCES LYIN3 500
FEET BELOW THE SURFACE WITHWT THE RIGHT OF SURFACE ENTRY, AS RESERVED IN DEED
FROM ELIZA= BAILEY BY DEED REGARDED IN BOOK 8916, PACE 577, OFFICIAL RECORDS.
NOTE: SAID LAND IS ALSO SHOWN AS PARCELS 1 ON A PARCEL, MAP RECORDED IN BOOK 25,
PAGE 22, OF PARCEL MAPS, RECORDS OF SAID ORAL aXWIY.
Y
EXHIBIT "A"
EXHIBIT "B"
RECORDING REQUESTED BY )
AND WHEN RECORDED MAIL TO: )
City of Huntington Beach )
2000 Main Street )
Huntington Beach, CA 92648 )
Attn: City Clerk )
l
(Space above for recorder)
This Agreement is recorded at the
request and for the benefit of the
City of Huntington Beach and is
exempt from the payment of fees
pursuant to Government Code
Section 6103.
SUPPLEMENTAL MEMORANDUM REGARDING
AGREEMENT CONTAINING COVENANTS AFFECTING REAL PROPERTY
THIS SUPPLEMENTAL MEMORANDUM REGARDING AGREEMENT CONTAIN-
ING COVENANTS AFFECTING REAL PROPERTY (the "Supplemental Memorandum") is
entered into this day of 199_, by and between the CITY OF
HUNTINGTON BEACH, a municipal corporation ("City"), and THE BRIDGES AMERICA
FOUNDATION, L.P., a California limited partnership ("Owner").
RECIIALS:
A. Owner is fee owner of record of that certain real property (the "Site") located in
the City of Huntington Beach, County of Orange, State of California legally described in
Attachment No. 1 hereto. There are currently twenty (20) 4-plexes with a total of eighty (80)
multi-family apartment units located on the Site.
B. On or about , 1995, City and Owner entered into that certain
Agreement Containing Covenants Affecting Real Property with respect to the Site
(the "Agreement"), a true and correct copy of which Agreement was recorded on
1995, as Instrument No. in the Official Records of the Orange
County Recorder's Office.
EXHIBIT
FS2\112\016271-0001\2147029.7 a09/15/95 Page 1 of 5
C. Pursuant to Section I(B) of the Agreement, as soon as the twenty-second (22nd)
"Affordable Unit" was rented to a "Lower Income Household" (as those terms are defined in
the Agreement) on the Site, City and Owner agreed to cooperate in the recordation of this
Supplemental Memorandum memorializing the expiration date of the "Affordability Period" (as
that term is defined in the Agreement).
D. City and Owner agree that the twenty-second (22nd) Affordable Unit on the Site
was rented to a Lower Income Household on , 199 .
NOW, THEREFORE, based upon the foregoing Recitals and for good and valuable
consideration, the receipt and sufficiency of which is acknowledged by both parties, City and
Owner agree as follows:
1. The Affordability Period referred to in Section I(B)of the Agreement shall expire
on ,20_(the thirtieth (30th) anniversary of the date that the twenty-second
(22nd) Affordable Unit on the Site was rented to a Lower Income Household).
2. Upon the expiration of the Affordability Period, all of the provisions of the
Agreement and this Supplemental Memorandum automatically shall become null and void and
shall be of no further force or effect. At such time, City agrees, upon request and at no cost
to City, to cooperate with Owner (including any successor or assign of the current owner's right,
title, and interest in and to the Site) to record an appropriate document or documents releasing
the Site from any covenants and restrictions set forth in the Agreement and this Supplemental
Memorandum. The failure to record such a document or documents, however, shall not extend
the duration of the Agreement or this Supplemental Memorandum beyond the expiration of the
Affordability Period as provided herein.
3. Except as expressly set forth herein, all of the terms of the Agreement shall
remain in full force and effect and unmodified by the provisions of this Supplemental
Memorandum.
[signatures on next page]
EXHIBIT "B"
FS2\112\016271-0001\2147029.6 .08/17i95 Page 2 of 5
J
IN WITNESS WHEREOF, City and Owner have executed this Supplemental
Memorandum to be effective as of the date first written above.
CITY OF HUNTINGTON BEACH,
a municipal corporation
Dated: By:
Director of Community Development
ATTEST:
City Clerk
APPROVED AS TO FORM:
City Attorney
THE BRIDGES AMERICA FOUNDATION,
a Delaware corporation
Dated: By:
Y
EXHIBIT "B"
PS2\112\0162714MM2147029.6 &M17/95 Page 3 of 5
STATE OF CALIFORNIA )
ss.
COUNTY OF )
On before me, personally
appeared
personally known to me (or proved to me on the basis of satisfactory evidence) to be the
person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s) or the entity upon behalf of which the person(s)
acted, executed the instrument.
Witness my hand and official seal.
Notary Public
[SEAL] -
STATE OF CALIFORNIA )
ss.
COUNTY OF )
On before me, personally
appeared
personally known to me (or proved to me on the basis of satisfactory evidence) to be the
person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s) or the entity upon behalf of which the person(s)
acted, executed the instrument.
Witness my hand and official seal.
Notary Public
(SEAL]
EXHIBIT .Bw
F=112\016771-OWI\2147029.6 &M17ro5 Page 4 of 5
STATE OF CALIFORNIA )
ss.
COUNTY OF )
On before me, personally
appeared
personally known to me (or proved to me on the basis of satisfactory evidence) to be the
person(s) whose names) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s) or the entity upon behalf of which the person(s)
acted, executed the instrument.
Witness my hand and official seal.
Notary Public
(SEAL]
STATE OF CALIFORNIA )
ss.
COUNTY OF )
On before me, personally
appeared-
personally known to me (or proved to me on the basis of satisfactory evidence) to be the
person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s) or the entity upon behalf of which the person(s)
acted, executed the instrument.
Witness my hand and official seal.
Notary Public
[SEAL]
EXHIBIT "B"
FS2\112\01e271-000i\2147on.6 &M17ro5 Page 5 of 5
AITACHIENT NO. 1
*LEGAL DESCRIPTION OF THE SITE
THAT PORTION OF THE WEST 10 ACRES OF THE SOUTH HALF OF THE SOM HALF OF THE
SXIHEAST UJARTER OF SECTION 23, TIJVMIP 5 SOUTH, RANGE 11 WEST, IN THE RANCHO
LA BOLSA CHICA, AS SHOWN CN A MAP RECORDED IN BOOK 51, PAGE 13, OF MISCELLANEOUS
MAPS, RECORDS OF SAID O0L4JTY, DESCRIBED AS FOLLOWS:
BEGINNING AT THE NORTHEAST CORNER OF SAID WEST 10 ACRES; TRICE SOUTH 340.00
FEET; 7fENCE WEST 640.00 FEET PARALLEL WITH THE NORTH LINE OF SAID WEST 10 ACRES
TO THE EAST LIM OF THE R.IG r—OF—WAY OF THE SOLTI4-lERN PACIFIC RAILWAY; THENCE
NORTH 340.00 FEET ALONG SAID EAT LINE TO THE NORTH LINE OF SAID WEST 10 ACRES;
THENCE EAST 640.00 FEET TO THE POINT OF BEGINNING.
EXCEPTING THER.EF CM THAT PORTICN THERMF INCLUDED WITHIN THE WE9=Y 570.00 FEET
OF THE SOUTH 100.00 FEET OF THE NORTH 340.00 FEET OF THE SOM HALF OF THE SOUTH
HALF OF THE SOUTHEAST 9-FR R OF SAID SECTION 23.
ALSO EXCEPTING ALL OIL, GAS, HYDROCARBONS, AND OTHER NO2MRAL SUBSTANCES LYING 500
FRET BELOW THE SURFACE WITHOUT THE RIGHT OF SURFACE ENTRY, AS RESERVED IN DEED
FRC M ELIZABETH BA= BY DES RECORDED IN BOOK 8916, PACE 577, OFFICIAL REC DRDS.
NOM: SAID LAND IS ALSO SHOWN AS PARCELS 1 ON A PARCEL MAP RECORDED IN BOOK 25,
PAGE 22, OF PARCEL MAPS, RECORDS OF SAID ORANGE COLIM.
s
ATTACHMENT NO. 1 ..
•
CITY OF HUNTINGTON BEACH
Inter-Department Communication
TO: Connie Brockway, City Clerk / f4.'
U�Io 1 Y9
FROM: Paul D'Alessandro,Assistant City Attorney U
DATE: June 28, 2000
SUBJECT: Bridges Covenant
Attached hereto is the fourth draft of the Bridges America covenant, with the revised Exhibit `B"
as you requested.
By copy hereof, I am transmitting the new original document to Mary Beth Broeren of Planning
to coordinate signatures from the Developer.
Attachment
c: Mary Beth Broeren (with original document for signatures)
�i
F'
4/s:4-2000 Memos:Clerk 6-28-Bridges
1 • •
4.4"J& CITY OF HUNTINCTON BEACH
INTER-DEPARTMENT COMMUNICATION
HUNTINGTON BEACH - Connie Brockway,City Clerk
Office of the City Clerk
f
Liz Ehring, Deputy City Clerk II
To:
Date: `.�� �{, 6w Meeting Date: 5 / OU Agenda Item:
Proposed City Council Agenda Items: The City Clerk's Office/City Administrator's Office must return your
agenda item due to the following requirements that have not been met. When your Agenda Item is ready to
resubmit, please return to: Elaine Kuhnke, Management Assistant, Administration
1. Signature(s)Needed
A On RCA
B On Agreement.-
C Other
2. Attachments
A Missing
B Not identified
C Other.
3. Exhibits -
A Missing
B Not identified
C Other
4. Insurance Certificate(Proof Of insurance)
A Not attached
B Not approved by City Attorney's Office
C Signed form notifying City Clerk that department will be responsible for obtaining insurance certificate on this item.(See form attached)
5. Wording On Request For Council Action(RCA)Unclear
A Recommended Action on RCA not completes G r Q
B Clarification needed on RCA
C Other
6. City Attorney Approval Required
7. Agreement Needs To Be Changed
A Page No.
8. Other_''
6 .�
i
G:agenda/m isdreaform
> CITY OF HUNTINGTON BEACH
{ INTERDEPARTMENTAL COMMUNICATION
TO: Ray Silver,.City Administrator
Paul D'Alessandro, Assistant City Attorney
FROM: Connie Brockway, City Clerk
DATE: April 26, 2000
SUBJECT: May 1, 2000 Agenda Item—Affordable Housing Agreement— &}
Bridges America Foundation, L.P. �t
Nie3;:
1. The City Clerk's Office is again returning the attached agreement. Please remove r
..'
Howard Zelefsky's name from the signature block in order for the Mayor to sign— `�, ,,vs
per the Recommended Action.
2. The agreement must be revised to delete - On September 16, 1995, Owner and
the City of Huntington Beach ("City') entered into that certain Agreement... This is
necessary as the developer accidentally recorded a document that had not yet =?_
been approved by Council. The present wording on the contract reflects that there r .
is an official document entered into, which is not the case, and which cannot.be
produced by the Clerk's Office upon request. Reference to an original agreement
between the City and Owner throughout this document is misleading. nn
3. Please advise as to whether this agreement, when being presented to the Recorder .
for recordation, must have on its face sheet wording to the effect that this ;
agreement supersedes Instrument No.19960029682 recorded on January 19, 1996.
The City Attorney's Office, in the past has advised the Clerk's Office that a first
recordation takes precedence-- not the subsequent recording unless it refers "
back to the first recording. ~='r `
F,
Attachment
CB:jh �5
glcbmemosBridges America—jh.doc
,
�1
F�2
>Mt4 CITY OF HUNTINGTON BEACH
INTERDEPARTMENTAL COMMUNICATION
TO: Paul D'Alessandro, Assistant City Attorney
VIA: Elaine Kuhnke, Management Assistant
FROM: Connie Brockway, City Clerk
DATE: April 21, 2000
SUBJECT: City Council Agenda Item for May 1, 2000 Re: Affordable Housing
Ageement— Bridges America Foundation
Please make the following corrections to the attached agreement and RCA:
1. The affordable housing agreement referred to in the RCA Statement of Issue, Staff
Analysis, and Recommended Action was not approved by the City Council in 1995.
The agreement was recorded by the developer prior to approval by Council. Please
revise the references to Council entering into an agreement on or about
• �� September 15, 1995, as there was no approval by Council.
6 k' _ &, .._.._
d '2.4lease revise the attached Suppleental Memorandum to reflect signature blocks
\AW .7r for the Mayor and City Clerk, ande the signature that has already been affixed
by Scott Hess for Howard Zelefsky. (Note: the County Recorder will not record a
v,lV 0``' document reflecting this type of signature—signed on behalf of, etc.)
�;,��^• ,�l L 3. Please revise the Recommended Action on the RCA to include execution by the
Mayor and City Clerk of both documents. (Currently the recommended action refers
to only one of the documents.)
Thanks for your help.
Attachments
CB:le
G:CBMemos\Bridges
Hl.�j
CITY OF HUNTINGTON BEACH
INTERDEPARTMENTAL COMMUNICATION
HUNTUNGTON BEACH
TO: Melanie Fallon, Assistant City Administrator
Howard Zelefsky, Planning Director
FROM: Connie Brockway, City Clerk
DATE: March 19, 1999
SUBJECT: Agreement Containing Covenants Affecting Real Property—Bridges
America Foundation, L.P.
Attached are communications regarding the timeline that the Planning Department had
anticipated being able to get City Council approval.
Please advise me of the status of this situation.
CC: Gail Hutton, City Attorney
Cbmemo/99-54jc
TiCe
JVotes /0/� 7
Office of the City Clerk �,�,��r;
,fir v
Huntington Beach, CaCifornia
#12 �� Ilaw lea o �
,ate
- 1/iL5 S v
�J , CITY OF HUNTINGTON BEACH
INTER-DEPARTMENT COMMUNICATION
HUNTINGTON BEACH
TO: Connie Brockway, City Clerk
FROM: Howard Zelefsky, Planning Director
DATE: October 30, 1998
SUBJECT: STATUS OF CENTERSTONE HOUSING AGREEMENT
As you are aware;the affordable housing covenants for the Bridges Project(including
Centerstone)need to be corrected and re-recorded. The covenants are still in the City
Attorney's office for revision. Planning Staff met with the Attorney's office on
September.21, 1998 regarding the covenants and a timeline for completing them. It is
expected that the revised covenants would be completed by the end of this year.
cc: Melanie S. Fallon, Assistant City Administrator
Paul D'Alessandro,Deputy City Attorney
Stephen Kohler, Project Manager, Economic Development
Mary Beth Broeren, Senior Planner
Q• r-
U Ln
Y U 1�
WW1i W LL
>WQQ:�
G rn
co
cy-
Z /2 4W CL `rj
TZL
L� .
A&* City of Huntington Beach
i P.O.Box 190-2000 Main Street
* Huntington Beach,California 92648
HUNTINGTON BEACH
From the desk of. Connie Brockway, CMC
City Clerk
Telephone: (714) 536-5404
Fax: (714)374-1557
j ?-�� - 97
i
I
i
-4
,;M
I
` � -p. ,
f
CITY OF HUNTINGTON BEACH
INTERDEPARTMENTAL COMMUNICATION
HUNTINOTON BEACH
TO: Melanie Fallon
Community Development Director
FROM: Connie Brockway
City Clerk
DATE: October 10, 1997 ,
SUBJECT: AGREEMENT CONTAINING COVENANTS AFFECTING REAL PROPERTY
TRACT NO. 15109—CENTERSTONE COMPANY—BEACH/ADAMS
The developer and title company accidentally sent this Affordable Housing Agreement to the
Orange County Recorder and recorded it on January 1, 1996. This recordation occurred
without the knowledge of the City Clerk's Office, Community Development Department, or the
approval of the agreement by the City Council. The document incorrectly reflects that the
recording was requested by the City Clerk's Office.
I have attached the memorandums outlining efforts made between the Community
Development Department and the City Clerk's Office to send this to Council. I am concerned
that this agreement gets taken care of, is approved by the City Council, and is properly
recorded.
1 believe the Community Development Department may be waiting for another phase of the
tract prior to submitting to Council; however, l believe unless that is absolutely necessary the
agreement must be put on the agenda now. Also, it may be time to send Exhibit"B"
(Supplemental_Memorandum to Agreement) to Council.
CB:cjg
cc: Honorable Mayor and City Councilmembers
Gail Hutton, City Attorney
Attachments: Copy of Agreement—City of Huntington Beach and the Bridges America
Foundation, L.P.
Copy of Memo Connie Brockway to Linda Niles dated July 29, 1997
Copy of Memo Connie Brockway to Melanie Fallon dated February 27, 1997
Copy of Memo Connie Brockway to Linda Niles dated February 9, 1996
Copy of Letter Jo Ann Ulvan/Kirk Evans to Melanie Fallon dated November 3, 1995
cbmemos/97-115cg
i
J� A&b City of Huntington Beach
P.O.Box 190-2000 Main Street
" Huntington Beach,California 92648
HUNTINGTON BEACH
From the desk of. Connie Brockway, CMC
City Clerk
Telephone: (714) 536-5404
Fax: (714) 374-1557
Z7,
�� ``°�-
Fl �
CITY OF HUNTINGTON BEACH
INTERDEPARTMENTAL COMMUNICATION
HUNTINOTON BEACH
TO: Melanie Fallon
Community Development Director
FROM: Connie Brockway r-8-
City Clerk
DATE: October 10, 1997
SUBJECT: AGREEMENT CONTAINING COVENANTS AFFECTING REAL PROPERTY.
TRACT NO. 15109—CENTERSTONE COMPANY—BEACH/ADAMS
The developer and title company accidentally sent this Affordable Housing Agreement to the
Orange County Recorder and recorded it on January 1, 1996. This recordation occurred
without the knowledge of the City Clerk's Office, Community Development Department, or the
approval of the agreement by the City Council. The document incorrectly reflects that the
recording was requested by the City Clerk's Office.
I have attached the memorandums outlining efforts made between the Community
Development Department and the City Clerk's Office to send this to Council. I am concerned
that this agreement gets taken care of, is approved by the City Council, and is properly
recorded.
I believe the Community Development Department may be waiting for another phase of the
tract prior to submitting to Council; however, I believe unless that is absolutely necessary the
agreement must be put on the agenda now. Also, it may be time to send Exhibit"B"
(Supplemental Memorandum to Agreement) to Council.
CB:cjg.
cc: Honorable Mayor and City Councilmembers
Gail Hutton, City Attorney
Attachments: Copy of Agreement—City of Huntington Beach and the Bridges America
Foundation, L.P.
Copy of Memo Connie Brockway to Linda Niles dated July 29, 1997
Copy of Memo Connie Brockway to Melanie Fallon dated February 27, 1997
Copy of Memo Connie Brockway to Linda Niles dated February 9, 1996
Copy of Letter Jo Ann Ulvan/Kirk Evans to Melanie Fallon dated November 3, 1995
cbmemos/97-115cg
FOECITY OF HUNTINGTON BEACH
INTERDEPARTMENTAL COMMUNICATION
HUNTINGTON
BEACH
TO: Linda Niles
Assistant Planner
FROM: Connie Brockway
City Clerk
DATE: July 29, 1997
SUBJECT: AGREEMENT CONTAINING COVENANTS AFFECTING REAL
PROPERTY BRIDGES AMERICA FOUNDATION, L.P.
Please inform me of your department's time line to send this agreement to the City
Council for approval.
J.
HUNTIUN ON BEACH
TO: Melanie Fallon, Community Development Director
FROM: Connie Brockway U -
City Clerk
DATE: February 27, 1997
SUBJECT: AGREEMENT CONTAINING COVENANTS AFFECTING REAL
PROPERTY- BRIDGES AMERICA FOUNDATION, L.P.
Please inform the City Clerk's Office of the date that the above agreement is expected
to appear before the City Council.
This agreement was executed and recorded without Council approval and this must be
rectified as soon as possible.
CC: Paul D'Allesandro, Deputy City Attorney
97CBMems/97-023:jc
f); �c c
J/P
, 56
TO: Linda Niles, Senior Planner
FROM: Connie Brockway, City Clerk
SUBJECT: Agreement Containing Covenants Affecting Real Property- Bridges
America Foundation, L.P.
DATE: Y1
February 9, 1996
a )1
O. Gov— t o
Linda, The above agreement (ORIGINAL ATTACHED) was somehow recorded by a
title company. You and I had been working toward sending this agreement to Counci ,
as was done with the Oceancrest L.P. New Rosebud Inc., Agreement (2-5-96 agenda, '
Page#9 attached). 02
The Title Company's recordation reflects that this document was recorded at the
request of the City Clerk's Office vAfh is not the case.
A procedure can be found whereby this agreement can be presented to Council as we
had planned. Please call me as soon as possible.
If your department determines that this agreement is not to be presented to Council i
would be best if the original agreement (attached) remain in the files of the C unity
Development Department.
Connie
536-5404
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FEB=19-98 THU 11 : 12 AM CITY O LENTO,! GROVE FAX 1,10, 61°46Q716 P. 1
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SPECIAL 1NST.1RUCTIONS:
DATE: TIME,)) , 1 bj. SENT BY: '
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We are transmitting pages, including this page. If received material is incomplete or
illegible, please call sender as soon as possible at (619)464-6934.
FEB-,19-98 TNU ? 1 ; 12 AM CITY P M0
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CITY OF LEMON GROVE
o ' 9 MEMORANDUM
41
DATE: October 24, 1997
TO: Mary Beth Broeren, Senior Planner
FROM: Linda S. Niles, Community Development Director
SUBJECT: CenterStone/Bridges Covenants
As per City Clerk, Connie Brockway, the situation to be rectified is as follows:
Kirk Evans incorrectly had a Title Company (Orange Coast Title) record his original
affordable housing covenant with an incorrect signature page (with only the owner,
City Attorney, and Community Development Director signatures; excluding the City
Administrator,.Mayor and City Clerk signatures), some incorrect wording, and
without returning to City Council for final approval of the agreement and terms before
recordation.
.Therefore, Connie felt that she could not keep the recorded covenant for Bridges
America Foundation, L.P. (Doc. No. 19960029682, recorded on 1/19/96) on file in
the vault as a legally recorded document requested by the City of Huntington Beach.
The original covenant included documentation of the required affordable housing
units for the following projects:
1. TTM No. 15109, approved by PC on 2128/95 for CenterStone (east side of Beach
Blvd., 400' South of Adams) for 30 detached single family residential units, requiring
3 affordable low income units be covenanted for 30 years.
2. TTM No. 15033, approved by the City Council on 3/6/95 for Greystone Homes,
Inc. (west side of Beach, between Memphis Avenue and Knoxville Street), for 69
single family residential,units, requiring 7 affordable low Income units be covenanted
for-30 years.
3. TTM No. 14515(R), approved by the Planning Commission on 6/13/95 for
Presley Companies (9800 Yorktown Avenue; the closed Bushard School site), for 58
single family residential units, requiring 6 affordable low income units be covenanted
for 30 years.; AND TTM No. 14990, approved by the Planning Commission on
6/13/95 for Presley Companies (the southeast corner of Cumberland Drive and
Victoria Lane; the closed Gill School site), for 58 single family residential units,
Page 1 of 6
FEB-19-98 TiiU 11 : 13 ,4M CITY Q= LEMON GROVE PAX, NO. 6194603716 , P. 3
requiring 6 affordable low income units be covenanted for 30 years. (collectively,
the "Presley projects")
The original covenant states that the site for the affordable housing units would be
located in an existing complex in the City of Huntington Beach being 20, 4 plexes,
having a total of 80 multi-family apartment units, located at 16884 Nicols Street
(called Brookwood Manor).
The original covenant designated that Bridges entered into agreements with the
developers of CenterStone (for 3 units), Greystone (for 7 units), and the Presley
projects (for 6 units and 6 units) to satisfy.those developers' affordable housing
obligations by providing the total of 22 affordable housing units within the 80 unit
residential complex at 16884 Nicols Street to be covenanted as low income
households (families whose income does not exceed 80% of the Orange County
median income) for 30 years.
As noted in Section I, B of the original Bridges covenant, it states that the affordable
units shall be subject to the requirements of the agreement for the 30 year
affordability period to be calculated "...from the date of this Agreement (1/19/96) until
the date that is 30 years from the date the 22"d affordable unit has been rented to a
lower income household." That same section recognizes that the units are currently
occupied, and that as they vacate they will be subject to rental to low income
families. Therefore, it could be a considerable amount of time before the 22"d unit is
rented to an eligible household.
In my discussions with Connie, it was agreed that if and when the original covenant was
corrected, it could go back to the City Council as a consent calendar item, as is the normal
procedure. We discussed that the correction to the original covenant would most likely be in the
form of a subsequent covenant that would supercede the original covenant (No. 19960029682),
and would include the addition of other developments that had purchased units in the 80 unit
complex to satisfy their affordable housing requirements, subsequent to the original covenant
being recorded. It was also discussed that, thereafter, any new developments that were to buy
into the units at 16884 Nicols Street to satisfy their required affordable housing units could be
added as separately recorded addendums to the new covenant without going back to City
Council for additional approval. The addendums would be able to be recorded separately,
referencing the newly recorded covenant, and designating that their required units (stating the
number) would come out of the.remaining units at the subject site.
Kirk Evans, submitted a draft of the proposed NEW covenant(s) for City review on June 10, 1996,
which included the addition of the following developments' affordable housing requirements to be
designated at 16884 Nicols Street:
Page 2 of 5
FEB-1,9-98 THU 11 : 14 APB C1 TY O, IE1JI0N GROVE FAX i10, 619 603716 P. 4
1. TTM No. 15071, approved by the City (I think.this went to CC on appeal) on
12/12/95 for Broadmoor (on Madera Lane), for 17 single family residential units,
requiring 2 affordable low income units be covenanted for 30 years. This recognizes
that the total number of units covenanted for affordable would now be at 24 units out
of the 80 unit complex. (See Paul D'Alessandro's and my corrections on page 2
of newly proposed covenant.) (FYI - The approval for Broadmoor required 1 unit
as low income and 1 unit as moderate income, but Kirk has determined that at this
time all units will be designated as low income.)
2. TPM No. 95-164, approved by the City on 12/03/95 for Atwood (facing Alhambra
and backing on Heil), for 3 single family residential units, requiring 1 affordable low
income unit be covenanted for 30 years. This recognizes that the total number of
units covenanted for affordable would now be at 25 units out of the 80 unit complex,
(FYI - The approval for Atwood required 1 unit as low and moderate income at 100%
of County median income.)
3. TTM No. 14655, approved by the City on 06/16/92 for TNR (east side of Lake
between Frankfort and Pecan; in a redevelopment area), for 10 single family
residential units, requiring 3 affordable low income units (15% affordable
requirement in redevelopment area if provided on-site; double if provided off-site) be
covenanted for 30 years, This recognizes that the total number of units covenanted
for affordable would now be at 28 units out of the 80 unit complex.
4. TTM No. 14177, approved by the City on 1/9/90 for Polygon (8166 Constantine),
for 28 single family dwelling units, requiring 3 affordable low income units be
covenanted for 30 years. This recognizes that the total number of units covenanted
for affordable would now be at 31 units out of the 80 unit complex.
The new covenants make no reference to"Exhibit B", which is the instrument used to record the
beginning of the affordability period (see "Exhibit B" attached to the original covenant). This is
the form approved by City Attorney for recording of the affordability period for all affordable
rental covenants. As noted on Paul D'Alessandro's corrections on page 2 of the Broadmoor
covenant, the intended start date for the 30 years is to be calculated from the date that the last
additional unit has been rented (which would apply to all subsequent covenants as the last
additional unit required per their covenant). In order for this date to be documented, an "Exhibit
B" still needs to be recorded for each of the developments that buy into 16884 Nicols Street.
Therefore, it appears to me that Paul and I may have missed the fact that this is not specified in
the newly proposed covenants, and that mention of"Exhibit B" needs to be included in these
covenants in the same location that it is mentioned in the original covenant. It looks like this
would be on page 2 of the new covenants in Section 1, sub-section 1.2 Duration of Affordability
Requirements. (See the correction note included on said page in packet.) Another option to
having all these different units with different 30 year affordability periods would be to consider
covenanting all 80 units at this time as affordable, and starting the 30 years after the 40th unit is
Page 3 of 5
FEB-19-99 THU 11 : 15 AM CITY OE-LEMON GROVE FAX 11O. 61946'03716 P. 5
y
rented as affordable. This would be a fair compromise, assuming that there will be more
developments that buy into this project in the future. This has not been discussed lately with
Kirk or Paul for this project, but this is what we did on the Hamptons and /Surfcrest project, The
affordability period started after half of the units were rented as affordable, and all of the units in
the complex were covenanted as affordable for the 30 years, even though their requirement was
less than the total units in the complex.
Kirk Evans has not submitted the required documentation as set forth in his original covenant
(page 3, Section 1, C), being the income certification for tenants in the first 22 units for the City's
review and approval; the date that the 22"d unit was rented to a low income household; and
"Exhibit B" for recordation. I would guess that the 22"d units has not yet been vacated by the
original tenants for re-rental to an affordable household. When the time comes for the City to
verify the eligibility of the tenants, the income verification documents would be any of those listed
in the abovementioned section of the original covenant and included in the new covenants as
Section 1, subsection 1.3, and would be submitted to us for review and approval prior to allowing
the recordation of"Exhibit B". In case your are looking for it, we have never put together an
"income computation and certification form" as mentioned in that section. (Kim Klopenstein may
be able to assist in reviewing the Bridges tenant certifications, since she reviewed the
documentation submitted for the Hamptons and Surfcrest for approval; and she reviewed their
"Exhibit B" for recordation.)
Subsequent to Kirk's submittal of the above four new covenants, the City has acknowledged in
writing two other projects for buying into 16884 Nicols Street. However, no new (draft)
covenants'have been submitted to date regarding those projects. The projects are:
9. TNR , Pierwalk II; DRB No. 97-6--This was 26 lots in a redevelopment area
between Main Street and Lake, for a requirement of 8 affordable units, 4 low and 4
very low.
2. Team Construction --Seabridge Village ; TTM 14740/CUP 94-32 —This was 20
Townhomes at Seabridge Village, for a requirement of 2 affordable units (approved
as equal mix of low and moderate income units).
If covenants are included for these additional projects, it would bring the total units covenanted
for affordable to 41 out of the 80 in the complex. Included in this packet, please find the
acknowledgements from the City for all of the above projects to buy into the 80 unit complex at
16884 Nicols Street.
In my last discussions with Paul D'Alessandro before I left, he felt that the newly proposed
covenants, as modified in the attached packet (except that we had not noticed there was no
mention of"Exhibit B", so this should be discussed with Paul)would adequately supercede the
original covenant (recorded incorrectly according to the City Clerk), and should satisfy the City
Clerk in order for her to be able to keep them on file in the City vault. It was also Mr.
Page 4 of 5
FEB-,19-98 THU 11 : 15 AM C1TY LEMON GROVE FAX NO, 6194603716 _ P. 6
D'Alessandro's opinion at that time that the originally recorded covenant(Doc. No.
1996OO29682) was a legal, binding document.
If you have questions after you review this packet, please feel free to contact me at (619) 464-
6934. Good Luck!!
(Included in the packet are two of Connie's memos with some return notes; the draft of the
original covenant to be recorded; the originally recorded covenant; the newly proposed
covenants intended to supercede the original covenant; acknowledgement letters from the City
for all projects that are buying into 16884 Nicols Street (from those included in the original
covenant, to those in the new covenants, and the last two request letters that have no draft
covenants on file];and a folder of miscellaneous documentation for the files.)
Page 5 of 5
it
November 3, 1995
City of Huntington Beach
2000 Main Street
Huntington Beach, CA 92648 11113
Attn..: Melanie Fallon
Director of Community Development
Dear Ms. Fallon,
Please have your signature and that of Gail Hutton notarized on both documents. Once
notarized lease contact m assistant Mean who will have the document picked u and
� p Y �Megan, p P
returned to my office.
If you have any questions, please do not hesitate to contact the undersigned. Until than, I remain;
Sincerely; e
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t
JAI
Jo Ann Ulvan/Kirk Evans =
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Enclosures: S rY
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November 3, 1995
City of Huntington Beach
2000 Main Street
Huntington Beach, CA 92648 / r 113
Attn..: Melanie Fallon
Director of Community Development
Dear Ms. Fallon,
Please have your signature and that of Gail Hutton notarized on both documents. Once
notarized lease contact m assistant Me who will have the document picked u and
P Y � g� P P
returned to my office. yo
If you have any questions, please do not hesitate to contact the undersigned. Until than, I remain;
Sincerely; ?�� A�'I
LP
Jo Ann Ulvan/Kirk Evans
Enclosures: S'�
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ORANGE COAST TITLE
Recoraea in the county of orange, california
RECORDING REQUESTED BY Gary l_. Granvi 1 1 e, clerk/Recorder
AND WHEN RECORDED MAIL TO: IIIIIIIIIIIIIIIIIIIIII+IIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIII No Fee
City of Huntington Beach 005 10003741 10 31 19960029682 3;31pm 01/19/96
20W Main Street Al2 16 7.00 45.00 0.00 0.00 0.00 0.00
Huntington Beach, CA 92648
Attn: City Clerk )
(Space above for recorder)
IT
This Agreement is recorded at the
request and for the benefit of the I b F
City of Huntington Beach and is
exempt from the payment of fees NF
pursuant to Government Code
Section 6103.
rY\
1 AGREEMENT CONTAINING COVENANTS AFFECTING REAL PROPERTY
THIS AGREEMENT CONTAINING COVENANTS AFFECTING REAL PROPERTY
(the "Agreement") is entered into this 17 fti day of 7 4lvu,4A r ;1996, by and between the
CITY OF HUNTINGTON BEACH, a municipal corporation ("City"), and THE BRIDGES '
AMERICA FOUNDATION, L.P., a California limited partnership ("Owner").
RECITALS:
A. Owner is fee owner of record of that certain real property (the "Site") located in
the City of Huntington Beach, County of Orange, State of California legally described in the
attached Exhibit "A." There are currently twenty (20) 4-plexes with a total of eighty (80) multi-
family apartment units located on the Site.
B. On February 28, 1995,the Planning Commission of City approved Tentative Tract
Map No. 15109 and Conditional Use Permit No. 94-40 which authorized the subdivision of
certain real property currently being acquired by The CenterStone Company located generally
on the east side of Beach Boulevard, 400 feet south of Adams Avenue, and the development on
said real property of thirty (30). detached residential units (the "CenterStone Project").
On March 6, 1995, the City Council of City approved Tentative Tract Map No. 15033,and
Conditional Use Permit No. 94-29 which authorized the subdivision of certain real property
currently being acquired by Greystone Homes, Inc., and located generally on the west side of
Beach Boulevard.between Memphis Avenue and Knoxville Street, and the development on said
real property of sixty-nine (69) single-family residential units (the "Greystone Project"). `
On June 13, 1995, the Planning Commission of City approved Tentative Tract Map
FS2\112\016271-0001\2147029.7 a09/15/95
No. 14515(R) and Site Plan Amendment No. 94-2 which authorized the subdivision of certain
real property currently being acquired by the Presley Companies and located.at 9800 Yorktown
Avenue (the closed Bushard School site) and the development on said real property of fifty-eight
(58) single-family residential units; also on June 13, 1995, the Planning Commission of City
approved Tentative Tract Map No. 14990 and Conditional Use Permit No. 94-26 for the
subdivision of certain real property currently being acquired by Presley Companies located at
'the southeast corner of Cumberland Drive and Victoria Lane (the closed Gill School site) and
the development on said real property- of fifty-eight (58) single-family residential units
(collectively, the "Presley Projects"). City imposed conditions of approval on the CenterStone
Project, the Greystone Project, and the Presley Projects requiring the developers of such projects
to provide a specified number of affordable housing units in conjunction with the new develop-
ments.
C. Owner has entered into agreements with the developers of the_ CenterStone
Project, the Greystone Project, and the Presley Projects to satisfy such developers' 'affordable
housing obligations by providing affordable housing within twenty-two (22) of the existing
residential dwelling units.on the Site (the "Affordable Units").
NOW, THEREFORE, BASED UPON THE FOREGOING RECITALS AND FOR
GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND SUFFICIENCY,OF
WHICH IS ACKNOWLEDGED BY BOTH PARTIES, CITY AND OWNER AGREE AS
FOLLOWS:
I. AFFORDABLE HOUSING
(A) Number of Units. Owner agrees to make available, restrict occupancy to,
and lease the twenty-two (22) Affordable Units on the Site to "Lower Income Households" at
an "Affordable Rent" for the duration of the "Affordability Period" (as those terms are defined
hereinbelow). Nothing in this Agreement shall restrict Owner's right to select which of the
eighty (80) rental housing units on the Site shall be the Affordable Units and Owner may at its
option change the location of the Affordable Units on the Site from time to time, provided that
a minimum of twenty-two(22)rental housing units shall be restricted as Affordable Units during
the entire Affordability Period.
As used in this Agreement, the term "Lower Income Household" shall mean
persons and families whose income does not exceed eighty percent (80%) of Orange County
median income, adjusted for family size, as determined by the United States Department of
Housing and Urban Development, as set forth in Health and Safety Code_Section 50079.5. .
As used in this Agreement, the term "Affordable Rent" shall have the;meaning
set forth in Section I(D) hereinbelow.
As used in this Agreement, the term "Tenant" shall mean any person who rents
or leases any portion of the Site or any person who is not a fee or equitable owner of any
portion of the Site who uses the Site as his or her principal residence. For purposes of this
Agreement, principal residence will be determined in the same manner as principal residence
is determined for state residency under California Vehicle Code Section 516.
M%112\016271-0001\2147029.6 a08/17/95 -2-
(B) Duration of Affordability-R�e uirements. The Affordable Units shall be
subject to the requirements of this Agreement from the date of this Agreement until the date that
is thirty (30) years from the date the twenty-second (22nd) Affordable Unit has been rented to
a Lower Income Household. City acknowledges that the residential.dwelling units on the Site
are occupied as of the date this Agreement and that the requirements of this Agreement will be
enforced by Owner as units are vacated and become available for 'rental to eligible households
in'the ordinary course of business. The duration of this requirement shall be known as the
"Affordability Period."
As soon as the twenty-second (22nd) Affordable Unit has been rented to a Lower
Income Household pursuant to this Agreement, City and Owner shall cooperate in the recorda-
tion of a supplemental Memorandum confirming the expiration date of the Affordability Period.
The form of the supplemental Memorandum is attached hereto as Exhibit
(C) Income of Tenant. After the lease of any Affordable Unit to a Tenant,
Owner shall submit to City a completed income computation and certification form,in such form
as is generally used by City in administering its affordable housing program from time to time.
Owner shall certify that to the best of its knowledge each Tenant of an Affordable Unit is a
Lower Income Household and meets the eligibility requirements established for the particular
Affordable Unit occupied by such household. Owner shall obtain an income certification from
each Tenant of an Affordable Unit and shall certify that, to the best of Owner's knowledge, the
income of the Tenant is truthfully set forth in the income certification form. Owner shall verify
the income certification of the Tenant in one or more of the following methods as specifically
requested by City:
(1) Obtain two (2) paycheck stubs from the Tenant's two (2) most
recent pay periods.
(2) Obtain a true copy of an income tax return from the Tenant for the
most recent tax year in which a return was filed.
(3) Obtain an income verification certification from the employer of
the Tenant.
(4) Obtain an income verification certification from the Social Security
Administration and/or the California Department of Social Services if the Tenant receives
assistance from such agencies.
(5) Obtain an alternate form of income verification reasonably requested
by City, if none of the above forms of verification is available to Owner.
If, after renting an Affordable Unit to an eligible household, the household's
income increases above the income level permitted for that unit, the household shall continue .
to be permitted to reside in such Affordable Unit. Subsequently, however, when the next
residential rental unit on the Site becomes vacant and available for rent, the vacant unit shall
become an Affordable Unit subject to the restrictions of this Agreement (and subject to Owner's
FS2\112\016271-0001\2147029.6 &W/17/95 -3-
retained discretion to change the location of Affordable Units from time to time, as provided in
Section I(A) herein).
(D) Determination of Affordable Rent for the Affordable Units. The maximum
monthly rental payment ("Affordable Rent") amount for the Affordable Units required to be
leased to Lower Income Households shall be established at thirty-five percent (35%) times
seventy-nine percent(79%)of the monthly area-median income for a household of four persons.
The Affordable Rent amount for the Affordable Units shall be adjusted annually
by the formula set forth above upon the publication of revised Orange County median income
figures by the United States Department of Housing and Urban Development.
OWNER UNDERSTANDS AND KNOWINGLY AGREES THAT THE
MAXIMUM RENTAL PAYMENTS TO BE ESTABLISHED BY THIS FORMULA ARE NOT
NECESSARILY EQUAL TO THE FAIR MARKET RENT FOR THE AFFORDABLE UNITS,
AND MAY BE ESTABLISHED AT A LEVEL SUBSTANTIALLY BELOW THE FAIR
MARKET RENT LEVELS.
OWNER HEREBY AG TO RESTRICT THE AFFORDABLE UNITS
ACCORDINGLY.
O ner's initials
(E) Annual Reps Within sixty (60)days after the end of each calendar year
during the Affordability Period, Owner .shall submit to City a report verifying Owner's
compliance with the provisions of Section I(A)-(D) of this Agreement. Owner's final annual
report shall be submitted to City within sixty (60) days after the end of the Affordability Period.
Each annual report shall identify the number and location of the Affordable Units for the appli-
cable reporting period, the identity of each Tenant occupying an Affordable Unit during any
portion of such period, the income and family size of each such Tenant, the Affordable Rent for
each of the Affordable Units, and the actual contract rent actually charged. If City prescribes
a particular form to be utilized by Owner in preparing the annual report,Owner shall utilize said
form, provided that it complies substantially with the foregoing requirements.
II. NON-DISCRIMINATION.
Owner, on behalf of itself and its successors, assigns, and each successor in
interest to the Site or: any part thereof, hereby further covenants and agrees during the
Affordability Period:
(A) Not to discriminate upon the basis of sex, marital status, race, ;color,
creed, religion, national origin, or ancestry in the sale, lease, sublease, transfer or rental, or in
the use, occupancy, tenure, or enjoyment of any of the Affordable Units on the Site. Each and
every lease and contract entered into with respect to any of the Affordable Units on the Site
during the Affordability Period shall contain or be subject to substantially the following
nondiscrimination or nonsegregation clauses:
FSZ112%016271-000M147029.6 a08/17/95 -4-
i ,
• • � Y
r '
In leases: "The lessee herein covenants by and for itself, its successors and
assigns, and all persons claiming under or through them, and this lease is made and accepted
upon and subject to the following conditions: ;r
That there shall be no discrimination against or segregation of any person or group
iof persons on account of sex,- marital status, race, color, creed, religion, national origin, or
ancestry, in the leasing, renting,subleasing, transferring, use, occupancy, tenure, or enjoyment
of the land herein leased, nor shall the lessee itself, or any other person claiming under or
through it, establish or permit such practices of discrimination or segregation with reference to
the selection, location, number, use, or occupancy of tenants, lessees, sublessees, subtenants,
or vendees in the land herein leased."
In contracts: "There shall be no discrimination against or segregation of any
persons or group of persons on account of sex, marital status, race, color, creed, religion,
national origin, or ancestry in the sale, lease, rental, sublease, transfer, use, occupancy, tenure,
or enjoyment of the land, nor shall the transferee itself or any person claiming un der or through
it, establish or permit any such practice or practices of discrimination or segregation with
reference to the selection, location,-number, use, or occupancy of tenants, lessees, subtenants,
sublessees, or vendees of the land."
III. USE RESTRICTIONS
During the Affordability Period, Owner shall be required to take all reasonable
steps necessary to ensure that each Tenant of an Affordable Unit and all assignees and trans-
ferees of such Tenant have knowledge of all terms and conditions of this Agreement by including
in each and every lease and rental agreement a clause which incorporates this Agreement by
reference and makes this Agreement a part of an attachment to such lease or rental agreement.
In addition, during the Affordability Period, each lease for any of the Affordable Units on the
"Site shall contain provisions that the Affordable Unit shall be occupied, used, and maintained
as follows:
(A) the dwelling unit shall be used only for private dwelling purposes, with
appurtenant facilities, and for no other purposes;
(B) the Tenant shall not permit or suffer anything to be done or kept upon the
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 reasonable noises or otherwise, nor shall any Tenant commit
or permit any nuisance on the premises or fail to keep the premises free of rubbish, clippings,
and trash or commit or suffer any illegal act to be committed thereon;
(C) the Tenant shall comply with all of the lawful requirements of all
governmental authorities with respect to the premises;
(D) 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 City;
FS2\112\016271-0001\2147029.6 a08/17/95 -5-
(E) no person shall be permitted to occupy the premises for transient or hotel
purposes; and
(F) the Tenant shall comply in all respects with this Agreement and any failure
by the Tenant to comply with the terms of this Agreement shall be a default under the Tenant's
lease-.-
IV. APPLICABLE LAW
(A) If any provision of this Agreement or portion thereof, or the application
to any person or circumstances, shall to any extent be held invalid, inoperative, or unenforce-
able, the remainder of this Agreement, or the application of such provision or portion thereof
to any other-persons or circumstances-, shall not be affected thereby; it shall not be deemed that
any such invalid provision affects the consideration for this Agreement; and each provision of
this Agreement shall be valid and enforceable to the fullest extent permitted by law.
(B) This Agreement shall be construed in accordance with the laws of the State
of California.
V. MISCELLANEOUS
(A) Satisfaction of Affordable Housing Obligations of CenterStone Project.
Greystone Project. and Presley Projects. By its approval and execution of this Agreement,
City acknowledges that upon the recordation of this Agreement against the.Site, Owner shall
have assumed the obligations of the CenterStone Project, the Greystone Project, and the Presley
Projects to provide affordable housing, that the owners/developers of those other projects
thereafter shall be released from the obligations to provide affordable housing as stated in the
conditions of approval for such projects, and that thereafter City shall look solely and exclusively
:to Owner and the Site for satisfaction of such affordable housing obligations. The owners/
developers of the CenterStone Project, the Greystone Project, and the Presley Projects shall be
third party beneficiaries of this Agreement to the extent necessary to enforce their respective
interests in this Section V(A), and this Agreement shall not be modified, amended, or terminated
in any manner which affects the CenterStone Project, the Greystone Project, or the Presley
Projects, or the respective interests of the owners/developers thereof, without the prior written
consent of the affected owner/developer(s), which consent may be withheld in such owner/
developer's sole and absolute discretion.
(B) Binding on Successors and Assigns. The covenants and agreements
established in this Agreement shall, without regard to technical classification and designation,
be binding on Owner and any successor to Owner's right, title, and interest in and to-all or any
portion of the Site, for the benefit of and in favor of the City of Huntington Beach: All the
covenants contained in this Agreement shall remain in effect for the Affordability Period, and
shall automatically terminate and be of no further force or effect after such time. Upon expira-
tion of the Affordability Period, City agrees to cooperate with Owner, at no cost to City, in
removing this Agreement of record from the Site.
FS2\112\016271-0001\2147029.6 a08/17/95 -6-
(C) Subordination to Trust Deeds. Notwithstanding any other provision in this
Agreement to the contrary, the covenants and agreements established in this Agreement at all
times shall be junior and subordinate to the lien of any mortgage or deed of trust recorded by
or on behalf of a lender to secure a loan for the acquisition or improvement of the Site,
including without limitation any deed of trust recorded concurrently herewith. City agrees, at
no,expense to City, to execute such documents as may be reasonably requested by Owner, any
successor or assign to Owner's right, title, and interest in and to all or any portion of the Site,
or any lender of any such person subordinating City's rights and interest under this Agreement
to the lien of any trust deed recorded or to be recorded by a lender securing a loan for the
acquisition or improvement of the Site. Owner, Owner's successor or assign, or the benefitted
lender shall be responsible for preparing the document(s) creating such subordination of City's
interest.
IN WITNESS WHEREOF, City and Owner have executed this Agreement Containing
Covenants Affecting Real Property to be effective as of the date first written above.
CITY OF HUNTINGTON BEACH,
��� a municipal corporation
Dated: By: ,il-e-�
Director of C mmunity Development
a �
`�+��ATTEST.
Clerk
APPROVED AS TO FORK
v
City Attorney
THE BRIDGES AMERICA FOUNDATION, L.P. .
a California limited partnership
By: The Bridges America Foundation,
a Delaware corporation
Dated:
Commonw�ea�lth o Vir mia. City/Count., of
. .�_ r !r . . Ackr:r°% d 3d a�si s�/ern
.
F�i:��lir,
r
P!y Co��nrnissio�� Expires
FS2\112\016271-0001\2147029.7 a09/15/95 -7-
C.AL�FORNIA ALL-PURPOSOACKNOWLEDGMENT
State of
County of
On T�.S before me, 2��� �^�7// igp V
Date Name and Title of Officer( Jae Doe,Notary Public-)
personally appeared
Name(s)of Signer(s)
❑personally known to me—OR—9proved to me on the basis of satisfactory evidence to be the person{s _
whose name(a) is/are subscribed to the within instrument
and acknowledged to me that Ise/she/th" executed the
same in#,is/her/their authorized capacity(ies), and that by
Isis/her/their signature(&)on the instrument the person(s),
or the entity upon behalf of which the personls) acted,
executed the instrument.
X. ELIZABETH EHRING
z • COMM.#1003397 Z WITNESS my hand and official seal.
rn Notary Public—Co6folo
ORANGE COUNTY
My Comm.Expires AUG 29.1997.
Signature of Notary9gublic
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 of this form to another document.
Description of Attached Document QQ
Title or Type of Document: ✓P—h� �1eR�i rJ4 � / p/+oid ey
Document Date: 9/116Ar Number of Pages: �6
Signer(s) Other Than Named Above-IV,-n 2 07419te/•
Capacity(ies) CAAlaimed by Signer(s)
Signer's Name:/��".Jibe S, /o4 Signer's Name:
❑ Individual ❑ Individual
V Corporate fficer ❑ Corporate Officer,
Title(s): r�ir 0*xnz. Title(s):
❑ Partner—❑ Limited ❑ Vneral ❑ 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 thumb here
Signer Is Representing: Signer Is Representing:
aZ&a.
01994 National Notary Association•8236 Remmet Ave.,P.O.Box 7184•Canoga Park,CA 91309.7184 Prod.No.5907 Reorder.Call Toll-Free 1-800-876-6827
STATE OF G Ar] IA fYjWN
) ss.
CO F'tT OF (� )
G�c y
On 9�1G/9 before me, gtceflu L �'� � , personally
appeared i')�i 01 e—
personally known to me (or proved to me on the basis of satisfactory evidence) to be the
person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s) or the entity upon behalf of which the person(s)
acted, executed the instrument.
Witness my hand and official seal.
Notary Pub
[SEAL]
boy CToaSti-=-'cn £xr;:py , _
STATE OF CALIFORNIA )
ss.
COUNTY OF )
On before me, personally
appeared
personally known to me (or proved to me on the basis of satisfactory evidence) to be the
person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s) or the entity upon behalf of which the person(s)
acted, executed the instrument.
Witness my hand and official seal.
Notary Public
[SEAL]
F32\112\0162714MI%2147029.6 &M/17ro3 -8-
ATTACHMENT NO. 1
On DESCRIPTION OF THE SITE
THAT PORTION OF THE WEST 10 ACRES OF THE SOUTH HATS` OF THE SOUIH HATS' OF THE
SOUTHEAST QL]ARTER OF SECTION 23, 7rWN3HIP 5 SOUTH, RANG 11 WEST, IN THE RA XW
LA BOLSA CHICA, AS SHOWN.CST A MAP. RECORDED IN BOOK 51, PAGE 13, OF MISCEL'[.,AMMUS
KU"S; RECORDS OF SAID COumy, DESCRIBED AS FOLLOWS:
BEGINNING AT THE NORTHEAST CORNER OF SAID WEST 10 ACRES; 'THENCE SOUTH 340.00
FEET; THENCE WEST 640.00 FEET PARALLEL WITH THE NORTH LINE OF SAID WEST 10 ACRES
TO THE EAST LINE OF THE RIG-IT-OF-WAY OF THE SO HERN PACIFIC RAILWAY; THENCE
NORTH 340.00 FEET ALONG SAID EAST LINE TO THE NORTH LINE OF SAID WEST 10 ACRES;
THENCE EAST 640.00 FEET TO THE POINT OF BEGIloMr,.
EXCEPTING THEREFROM THAT PORTION THEREOF INCLUDED WITHIN` THE WESTERLY 570.00 FEET
OF THE SOUIH 100.00 FEET OF THE NORTH 340.00 FEET OF THE SOUTH HALF OF THE SOUTH
HALF OF THE SOUTHEAST QUARTER OF SAID SECTION 23.
ALSO EXCEPTING ALL OIL, GAS, HYDROCARBONS, AND OrIfER MINERAL SUBSTANCES LYING 500
FEET BELOW THE SURFACE WIT14OW THE RIGHT OF SURFACE ENTRY, AS RESERVED IN DEED
FROM ELIZABETH BAILEY BY DEED RECORDED IN BOOK 8916, PACE 577, OFEICTAL RECORDS.
NOTE: SAID LAND IS ALSO SHOW AS PARCELS 1 ON A PARCEL MAP RECORDED IN BOOK 25,
PACE 22, OF PARCEL MAPS, RECORAS OF SAID ORANGE COUNTY.
ATTACHMENT NO. 1
• � • EXHIBIT "A"
LEGAL DESCRIPTION OF THE SITE
THAT PCFMCN OF THE WEST 10 ACRES OF THE SOUTH HALF OF THE SOUTH HALF OF THE
SOUTHEAST QUARTER OF SECTION 23, 'IC7V OUP 5 SOUTH, RANGE 11 WEST, IN THE RADTC HO
LA BOLSA CHIC,, AS SHOW ON A MAP RECORDED IN BOOK 51, PAGE 13, OF MISC ]OUS
MAPS, RECORDS OF SAID COUNTY, -DESCRIBED AS FOLLOWS:
BEGINNING AT THE NORTHEAST CORNER OF SAID WEST 10 ACRES; THENCE SCXTIH" 340.00
FEET; .THENCE WEST 640.00 FEET PARALLEL LEE WITH THE NORTH LINE OF SAID WEST 10 ACMES
TO THE ;EAST LINE OF THE RIGHT-OF-WAY OF THE SOUTHERN PACIFIC RAnk%AY; THENCE
NORTH 340.00 FEET ALONG SAID EAST LINE TO THE NORTH LINE OF SAID WEST 10 ACRES;
THENCE EAST.64 0.0 0 FEET TO THE POINT OF BSGI NNING.
EXCITING THEREFROM THAT PORTION THEREOF INCLUDED WITHIN THE WESTMY 570.00 FEET
OF THE SOUTH 100.00 FEET OF THE NORTH 340.00 FEET OF THE SOUTH HALF OF THE SOUTH
HALF OF THE SOUIHFAST QUARTER OF SAID SEcTICN 23.
ALSO EXCEPTING ALL OIL, GAS, , AND OTHER MINERAL SUBSTANCES LYING 500
FEET BELOW THE SURFACE WITHOUT THE RIGHT OF SURFACE ENTRY, AS RESERVED IN DEED
FROM ELIZABEIH BAILEY BY DEED RECORDED IN BOOK 8916, PAGE 577, OFFICIAL RECORDS.
NOTE: SAID LAND IS ALSO SHOWN AS PARCELS 1 ON A PARCH MAP RECORDED IN BOOK 25,
PAGE 22, OF PARCEL MAPS, RECORDS OF SAID ORANGE 001=.
EXHIBIT "A"
EXHIBIT "B"
RECORDING REQUESTED BY )
AND WHEN RECORDED MAIL TO: )
City of Huntington Beach )
2000 Main Street )
Huntington Beach, CA 92648 )
Attn: City Clerk )
1
(Space above for recorder)
This Agreement is recorded at the
request and for the benefit of the
City of Huntington Beach and is
exempt from the payment of fees
pursuant to Government Code
Section 6103.
SUPPLEMENTAL MEMORANDUM REGARDING
AGREEMENT CONTAINING COVENANTS AFFECTING REAL PROPERTY
THIS SUPPLEMENTAL MEMORANDUM REGARDING AGREEMENT CONTAIN-
ING COVENANTS AFFECTING REAL PROPERTY (the "Supplemental Memorandum") is
entered into this day of '. . . 199_, by and between the CITY OF
HUNTINGTON BEACH, a municipal corporation ("City"), and THE BRIDGES AMERICA
FOUNDATION, L.P., a California limited partnership ("Owner").
R- ECITAES:
A. Owner is fee owner of record of that certain real property (the "Site") located in
the City of Huntington Beach, County of Orange, State of California legally described in
Attachment No. 1 hereto. There are currently twenty (20) 4-plexes with a total of eighty (80)
multi-family apartment units located on the Site.
B. On or about , 1995, City and Owner entered into that certain
Agreement Containing Covenants Affecting Real Property with respect to the Site
(the "Agreement"), a true and correct copy of which Agreement was recorded on
, 1995, as Instrument No. in the Official Records of the Orange
County Recorder's Office.
EXHIBIT "B"
Psz\uz\oisz71-OW1\2147029.7 ao9i15i95. Page 1 of 5
C. Pursuant to Section I(B) of the Agreement, as soon as the twenty-second (22nd)
"Affordable Unit" was rented to a "Lower Income Household".(as those terms are defined in
the Agreement) on the Site, City and Owner agreed to cooperate in the recordation of this
Supplemental Memorandum memorializing the expiration date of the "Affordability Period" (as
that term is defined in the Agreement).
D. City and Owner agree that the twenty-second (22nd) Affordable Unit on the Site
was rented to a Lower Income Household on , 199 .
NOW, THEREFORE, based upon the foregoing Recitals and for good and valuable
consideration, the receipt and sufficiency of which is acknowledged by both parties, City and
Owner agree as follows:
1. The Affordability Period referred to in Section I(B)of the Agreement shall expire
on , 20 (the thirtieth(30th)anniversary of the date that the twenty-second
(22nd) Affordable Unit on the Site was rented to a Lower Income Household).
2. Upon the expiration of the Affordability Period, all of the provisions of the
Agreement and this Supplemental Memorandum automatically shall become null and void and
shall be of no further force or effect. At such time, City agrees, upon request and at.-no cost
to City, to cooperate with Owner (including any successor or assign of the current owner's right,
title, and interest in and to the Site) to record an appropriate document or documents releasing
the Site from any covenants and restrictions set forth in the Agreement and this Supplemental
Memorandum. The failure to record such a document or documents, however, shall not extend
the duration of the Agreement or this Supplemental Memorandum beyond the expiration of the
Affordability Period as provided herein.
:3. Except as expressly set forth herein, all of the terms of the Agreement shall
remain in full force and effect and unmodified by the provisions of this Supplemental
Memorandum.
[signatures on next page]
EXHIBIT "B"
FS2\112\016271-0001\2147029.6 a0E/17/95 Page 2 of 5
IN WITNESS WHEREOF, City and Owner have executed this Supplemental
Memorandum to be effective as of the date first written above.
CITY OF HUNTINGTON BEACH,
a municipal corporation
Dated: By:
Director of Community Development
ATTEST:
City Clerk
APPROVED AS TO FORM:
City Attorney
THE BRIDGES AMERICA FOUNDATION,
a Delaware corporation
Dated: By:
EXHIBIT "B"
PS2X112\016271-W01U147029.6 a09/17/93 Page 3 of 5
STATE OF CALIFORNIA )
ss.
COUNTY OF )
On before me, personally
appeared
personally known to me (or proved to me on the basis of satisfactory evidence) to be the
person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s) or the entity upon behalf of which the person(s)
acted, executed the instrument.
Witness my hand and official seal.
Notary Public
[SEAL] .
STATE OF CALIFORNIA )
ss.
COUNTY OF )
On before me, per.sonally
appeared
personally known to me (or proved to me on the basis of satisfactory evidence) to be the
person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s) or the entity upon behalf of which the person(s)
acted, executed the instrument.
Witness my hand and official seal.
Notary Public
(SEAL]
EXHIBIT "B"
F82IM016MOO IM47M9.6 NW17/95 Page 4 of 5
i
STATE OF CALIFORNIA )
ss•
COUNTY OF )
On before me, personally
appeared
personally known to me (or proved to me on the basis of satisfactory evidence) to be the
person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s) or the entity upon behalf of which the person(s)
acted, executed the instrument.
Witness my hand and official seal.
Notary Public
[SEAL]
STATE OF CALIFORNIA )
ss.
COUNTY OF )
On before me, personally
appeared
personally known to me (or proved to me on the basis of satisfactory evidence) to be the
person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s) or the entity upon behalf of which the person(s)
acted, executed the instrument.
Witness my hand and official seal.
Notary Public
[S]EAL]
EXHIBIT ~B"
PS2\112\01ern-000i\x1470".6 &W17ro5 Page 5 of 5