HomeMy WebLinkAboutA6115 - PS HOUSING INVESTORS LP FOR SUNSET PALM SENIOR APTS-23 UNITS 2017-0482149
RECORDING REQUESTED BY 11/17/2017 08:37 AR Fee: $ 0.00
AND WHEN RECORDED MAIL TO: Page 1 of 16
Recorded in Official Records
City of Palm Springs County of Riverside
Peter Aldana
Attn.: City Clerk Assessor-County Clerk-Recorder
3200 E. Tahquitz Canyon Way till ' Q6111t �'I III
Palm Springs, CA 92262
No fee document pursuant to 6
Government Code Section 27383 �+ NC✓x-�dla� dot +�� ,rP f�+
APN: 505-184-019, 020, 027
DEED OF TRUST AND SECURITY AGREEMENT
PHIS DEED OF TRUST AND SECURITY AGREEMENT ("Deed of Trust") is made
this l0 day of /�( UOZ4`� , 2017. Trustor is PS Housing Investors, LP, a California
limited partnership ("PS HOUSING"), and Trustee is First American Title & Escrow, whose
address is 250 East Palm Canyon Drive, Palm Springs, CA 92264 ("Trustee"), and is entered
into for the benefit of the City of Palm Springs, a California municipal corporation, as
beneficiary ("CITY").
FOR GOOD AND VALUABLE CONSIDERATION, including the indebtedness herein
recited, the receipt of which is hereby acknowledged, PS HOUSING, hereby irrevocably grants,
transfers, conveys and assigns to CITY, IN TRUST, WITH POWER OF SALE, for the benefit
and security of CITY, under and subject to the terms and conditions hereinafter set forth, PS
HOUSING's fee interest in the property located in Riverside County, California, Assessor Parcel
Numbers 505-184-019, 020 and 027 as more fully described in Exhibit "A" attached hereto, and
more commonly known as 1433-1455 North Indian Canyon Drive, in the City of Palm Springs,
County of Riverside, State of California (the "Property").
TOGETHER WITH all easements, rights-of-way and rights used in connection therewith
or as a means of access thereto;
TOGETHER WITH any and all buildings, improvements and landscaping of every kind
and description now or hereafter erected thereon, and all property of PS HOUSING now or
hereafter affixed to or placed upon the Property (sometimes collectively referred to as the
"Improvements");
TOGETHER WITH all right, title and interest of PS HOUSING, now owned or hereafter
acquired, in and to any land lying within the right-of-way of any street, open or proposed,
adjoining the Property, and any and all sidewalks, alleys and strips and areas of land adjacent to
or used in connection with the Property;
TOGETHER WITH all estate, interest, right, title, other claim or demand, of every
nature, in and to such property, including the Property, both in law and in equity, including, but
not limited to, all oil, gas and mineral rights (including royalty and leasehold rights relating
thereto), all water and water rights and shares of stock relating thereto, and any and all awards
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1271969.2
made for the taking by eminent domain or by and proceeding or purchase in lieu thereof of the
whole or any part of such property; and
TOGETHER with all articles of personal property or fixtures now or hereafter attached to
or used in and about the building or buildings now erected or hereafter to be erected on the
Property which are necessary to the complete and comfortable use and occupy of such building
or buildings for the purposes for which they were or are to be erected, including all other goods
and chattels and personal property as are ever used or furnished in operating a building, or the
activities conducted therein, similar to the one herein described and referred to, and all renewals
or replacements thereof or articles in substitution therefore, whether or not the same are, or shall
be attached to said building or buildings in any manner.
All of the foregoing, together with the Property, is herein referred to as the "Security".
To have and to hold the Security together with acquittances to the Trustee, its successors
and assigns forever.
TO SECURE to CITY the obligations and any payments required by that certain
Promissory Note,between PS HOUSING and CITY, of even date herewith ('Note");
TO SECURE to CITY the performance by PS HOUSING of all agreements and
adherence to all conditions set forth herein and in the Note;
TO SECURE all renewals, extensions, supplements and other modifications of any of the
foregoing, including without limitation modifications that are evidenced by new or additional
documents or that change the rate of interest on any obligation; and
TO SECURE the payment of all other sums, with interest thereon, advanced in
accordance herewith, to protect the security of this Deed of Trust; and the performance of the
covenants and agreements of PS HOUSING herein contained.
All of the foregoing obligations, as well as those identified hereafter, are referred to
collectively herein as the 'PS HOUSING Covenants."
TO PROTECT THE SECURITY OF THIS DEED OF TRUST, PS HOUSING
COVENANTS AND AGREES AS FOLLOWS:
1. Purpose. This Deed of Trust secures the Note for $1,500.000.00 dated
2017 pursuant to that Settlement Agreement and Release of All Claims of even
date herewith.
2. Definitions. The terms set forth in this section shall have the following meanings
in this Deed of Trust. Any capitalized terms not defined in this Deed of Trust shall have the same
meanings as defined in the Settlement Agreement and the Note, the terms of which have been
incorporate into this Deed of Trust.
a. "PS HOUSING" shall mean the trustor, PS Housing Investors, LP.
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1271969.2
b. "Deed of Trust" shall mean this Deed of Trust and Security Agreement.
C. "Loan" shall have the same meaning as set forth in the Promissory Note.
d. "Note" shall mean that certain Promissory Note secured by this Deed of
Trust, of even date herewith, executed by PS HOUSING for the benefit of
the CITY.
e. "CITY" shall mean the City of Palm Springs, a California municipal
corporation.
f. "Settlement Agreement" shall mean the Settlement Agreement and
Release of All Claims, executed by PS HOUSING on September 25, 2017
and the CITY on September 13 , 2017.
Ko"bw
g. "Property" shall mean that certain real property located at 1433-1455
North Indian Canyon Drive in the City of Palm Springs, APNs 505-184-
019, 020, and 027, together with all Improvements, and fixtures now or
hereafter constructed, placed or located on the Property.
h. "Term" shall mean the term of the Note, the obligations of which are
secured by this Deed of Trust.
3. PS Housing s Estate. PS HOUSING represents and warrants that it is lawfully
seized of the estate hereby conveyed, that it has the right to grant and convey the Security, and
that other than this Deed of Trust, and the Note, the Security is not encumbered by any senior
liens. PS HOUSING agrees to warrant and defend generally the title to the Security against all
claims and demands, subject to any declarations, easements or restrictions listed in a schedule of
exceptions to coverage of any title insurance policy insuring CITY's interest in the Security.
4. Payment of Sums Owed. PS HOUSING shall promptly pay to CITY, when due,
any amounts due under the Note, including, but not limited to amounts due under the Loan as set
forth in the Note.
5. PS HOUSING Covenants. PS HOUSING will observe and perform all of the
covenants and agreements of the PS HOUSING Covenants, as more specifically contained
herein.
6. Transfer of Property by PS HOUSING. Prior to expiration of the Term, PS
HOUSING agrees that PS HOUSING shall not sell or transfer the Security except as may be
provided in the Note and the Disposition and Development Agreement, without the prior written
consent of CITY. The following events shall not be considered a transfer of interest: (a) a
change in ownership of PS HOUSING as a result of a merger, consolidation, reorganization, or
joint venture; (b) the sale, exchange, issuance, or other transfer of PS HOUSING's stock on a
national exchange or between PS HOUSING's parent company, if any, and any subsidiary,
affiliate, related entity, or other entity that controls, is controlled by, or is under common control
with PS HOUSING; (c) the Transfer of this Agreement to PS HOUSING's parent entity, if any,
or any subsidiary, affiliate, related entity, an entity that controls, is controlled by, or is under
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1271969.2
common control with PS HOUSING; or (d) a collateral assignment of PS HOUSING's interest
in this Agreement to a lender as security for any indebtedness of PS HOUSING to the lender. PS
HOUSING shall not be required to obtain City's consent and City shall have no right to delay,
alter, or impede any of the foregoing transactions or combinations thereof, but such transfer of
interest shall be effective only upon not less than sixty (60) days written notice to City.
7. Liens. PS HOUSING shall not cause, incur, suffer or permit to exist, other than
the existing Deed of Trust in favor of IFG Capital, LLC, recorded on June 7, 2012 by Insstument
#2012-0261941,or become effective any lien, encumbrance or charge upon all or any part of the
Property, or any interest therein other than (i) easements, rights of way, covenants, conditions,
restrictions, liens and other title limitations as provided in the Disposition and Development
Agreement, or as approved in writing by CITY, and (ii) immaterial easements and rights of way
which are required by governmental authorities as a condition to the use of the Security
(collectively, the "Permitted Encumbrances"). PS HOUSING shall pay and promptly discharge,
at PS HOUSING's cost and expense, all liens, encumbrances and charges upon the Security, or
any part thereof or interest therein other than the Permitted Encumbrances. If PS HOUSING
shall fail to remove and discharge any such lien, encumbrance, or charge, then, in addition to any
other right or remedy of CITY, CITY may, but shall not be obligated to, discharge the same,
without inquiring into the validity of such lien, encumbrance or charge nor inquiring into the
existence of any defense or offset thereto, either by paying the amount claimed to be due, or by
procuring the discharge of such lien, encumbrance or charge by depositing in court a bond or the
amount claimed, or otherwise giving security for such claim, in such manner as is or may be
prescribed by law. PS HOUSING shall, immediately upon demand by CITY, pay to CITY an
amount equal to all costs and expenses incurred by CITY in connection with the exercise by
CITY of the foregoing right to discharge any such lien, encumbrance or charge, together with
interest thereon from the date of such expenditure and, until paid, such sums shall be secured
hereby.
8. Preservation and Maintenance of Security. PS HOUSING agrees that at all times
prior to full payment of the sums owed under the Note, secured by this Deed of Trust, that the PS
HOUSING will, maintain, preserve and keep the Security or cause the Security to be maintained
and preserved in good condition and repair and in a prudent and businesslike manner.
9. Protection of CITY's Security.
a. If PS HOUSING fails to perform the PS HOUSING Covenants or any
obligations contained in this Deed of Trust, or the Note, if an Event of
Default, as defined hereafter, occurs, or if any action or proceeding is
commenced which materially affects CITY's interest in the Security, then
CITY, at its option and upon notice to PS HOUSING, may make such
appearances, disburse such sums and take such action as it determines
necessary to protect CITY's interest, including but not limited to,
disbursement of reasonable attorney's fees and necessary repairs to the
Security.
b. Any amounts disbursed by CITY pursuant to this Section will become an
indebtedness of PS HOUSING secured by this Deed of Trust. Unless PS
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1271969.2
HOUSING and CITY agree to other terms of payment, such amount will
be payable upon notice from CITY to PS HOUSING requesting payment
thereof, and will bear interest of ten percent (10%) from the date of
disbursement unless payment of interest at such rate would be contrary to
applicable law, in which event such amounts will bear interest at the
highest rate permissible under applicable law. Nothing contained in this
Section will require CITY to insure any expense or take any action
hereunder.
C. In the event that the PS HOUSING fails to observe or perform any
obligations or PS HOUSING Covenants under this Deed of Trust, or the
Note, then the CITY may hold PS HOUSING in default, treat the
occurrence as an Event of Default pursuant to this Deed of Trust, and take
any actions available under this Deed of Trust, or the Note, including, but
not limited to, acceleration of any payments due or sale of the Security, as
provided for hereafter.
10. Events of Default. Each of the following shall constitute an event of default
("Event of Default"): (a)the occurrence of any default under the provisions of this Deed of Trust,
or the Note; or (b) the failure to make any payment or perform any of PS HOUSING's other
obligations now or hereafter secured by this Deed of Trust (subject to any applicable cure
period).
11. Acceleration. Remedies and Notice. If PS HOUSING is in default of any
obligations under this Deed of Trust (including the PS HOUSING Covenants), or the Note, or at
the occurrence of any Event of Default, then at the option of CITY, the amount of any payment
related to any such default, the Loan amount under the Note, as applicable, and any other
indebtedness and other obligations secured hereby shall immediately become due and payable
without presentment, protest notice or demand, all of which are hereby expressly waived, upon
written notice by CITY to PS HOUSING and no omission on the part of CITY to exercise such
option when entitled to do so shall be construed as a waiver of such right.
Upon PS HOUSING's breach of any covenant or agreement in this Deed of Trust
(including, but not limited to, the covenant to pay, when due, any sums secured by this Deed of
Trust), or the Note, or upon the occurrence of an Event of Default, CITY, prior to acceleration of
the sums due under the Note, shall provide notice by certified mail, return receipt requested, to
PS HOUSING specifying:
a. the breach or Event of Default;
b. if the breach or Event of Default is curable, and the action required to cure
such breach;
C. a date, not less than thirty (30) days from the date the notice is effective,
by which such breach, if curable, is to be cured; and
d. if the breach is curable, that failure to cure such breach on or before the
date specified in the notice may result in acceleration of the sums due
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1271969.2
under the Note, as secured by this Deed of Trust, as well as sale of the
Security (collectively the "Notice of Default")
If the breach or Event of Default is not curable or is not cured on or before the date
specified in the Notice of Default, CITY, at its option, may:
i. declare all of the sums secured by this Deed of Trust to be immediately
due and payable without further demand and may invoke the power of sale
and any other remedies permitted by California law;
ii. commence an action to foreclose this Deed of Trust as a mortgage, or
specifically enforce any of the covenants hereof;
iii. deliver to Trustee a written declaration of default and demand for sale,
pursuant to the provisions for notice of sale as the law may require; or
iv. exercise all other rights and remedies provided herein, in the instruments
by which PS HOUSING acquires title to any Security, or in any other
document or agreement now or hereafter evidencing, creating or securing
all or any portion of the obligations secured hereby; or provided by law.
The Notice of Default shall also inform PS HOUSING of PS HOUSING's right to
reinstate after acceleration and the right to bring a court action to assert the nonexistence of
default or any other defense of PS HOUSING to acceleration and sale.
CITY shall be entitled to collect all reasonable costs and expenses incurred in pursuing
the remedies provided in this Section.
12. Foreclosure by Power of Sale. Should CITY elect to foreclose by exercise of the
power of sale herein contained, CITY shall notify Trustee and shall deposit with Trustee this
Deed of Trust, and the Note, which is secured hereby (and the deposit of which shall be deemed
to constitute evidence that unpaid amounts due pursuant to the Note are immediately due and
payable), and such receipts and evidence of any expenditures made that are additionally secured
hereby as Trustee may require.
a. Upon receipt of such notice of election to foreclose from CITY, Trustee shall
cause to be recorded, published and delivered to PS HOUSING the Notice of
Default, as outlined above, and CITY'S notice of election to sell as then required
by law and by this Deed of Trust. Trustee shall, without demand on PS
HOUSING, after lapse of such time as may then be required by law and after
recordation of a Notice of Default and after Notice of Sale having been given as
required by law, sell the Security, at the time and place of sale fixed by it in said
Notice of Sale, whether as a whole or in separate lots or parcels or items as
Trustee shall deem expedient and in such order as it may determine unless
specified otherwise to the PS HOUSING according to law, at public auction to the
highest bidder, for cash in lawful money of the United States payable at the time
of sale. Trustee shall deliver to such purchaser or purchasers thereof its good and
sufficient deed or deeds conveying the property so sold, but without any covenant
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or warranty, express or implied. The recitals in such deed or any matters of facts
shall be conclusive proof of the truthfulness thereof. Any person, including,
without limitation Trustee or CITY, may purchase at such sale, and PS
HOUSING hereby covenants to warrant and defend the title of such purchaser or
purchasers.
b. After deducting all reasonable costs, fees and expenses of Trustee, including costs
of evidence of title in connection with such sale, Trustee shall apply the proceeds
of sale to payment of: (i) the unpaid amounts due pursuant to the Note; (ii) all
other sums then secured hereby, as applicable; and (iii) the remainder, if any, to
PS HOUSING.
C. Trustee may postpone sale of all or any portion of the Security by public
announcement at such time and place of sale, and from time to time thereafter,
and without further notice make such sale at the time fixed by the last
postponement, or may, in its discretion, give a new notice of sale.
13. PS HOUSING's Right to Reinstate. Notwithstanding CITY's acceleration of the
sums secured by this Deed of Trust, or other actions taken in response to any Event of Default of
PS HOUSING, PS HOUSING shall have the right to have any proceedings commenced by
CITY, to enforce this Deed of Trust, discontinued at any time prior to five (5) days before sale of
the Security pursuant to the power of sale contained in this Deed of Trust or at any time prior to
entry of a judgment enforcing this Deed of Trust if:
a. PS HOUSING pays CITY all sums which would be then due under this Deed of
Trust, or the Note, as applicable;
b. PS HOUSING cures all breaches of any other covenants or agreements of PS
HOUSING contained in this Deed of Trust, or the Note, as applicable
C. PS HOUSING pays all reasonable expenses incurred by CITY and Trustee in
enforcing the covenants and agreements of PS HOUSING contained in this Deed
of Trust, and in enforcing CITY's and Trustee's remedies, including, but not
limited to, reasonable attorney's fees, as applicable; and
d. PS HOUSING takes such action as CITY may reasonably require to assure that
the lien of this Deed of Trust, CITY's interest in the Security and PS HOUSING's
obligation to pay the sums secured by this Deed of Trust shall continue
unimpaired.
Upon such payment and cure by PS HOUSING, this Deed of Trust and the obligations
secured hereby shall remain in full force and effect as if no acceleration had occurred.
14. Forbearance by CITY Not a Waiver. Any forbearance by CITY in exercising any
right or remedy shall not be a waiver of the exercise of any such right or remedy, nor shall
acceptance by CITY of any payment provided for in the Note constitute a waiver of the CITY's
right to require prompt payment of any remaining amounts owed. The procurement of insurance
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or the payment of taxes or other liens or charges by CITY shall not be a waiver of CITY's right
to accelerate the maturity of the indebtedness secured by this Deed of Trust.
15. Remedies Cumulative. All remedies provided in this Deed of Trust are distinct
and cumulative to any other right or remedy under this Deed of Trust or any other document,
including the Note, or afforded by law or equity, and may be exercised concurrently,
independently or successively at the discretion of CITY.
16. Reconvevance. Upon payment of all sums secured by this Deed of Trust, as set
forth in the Note, CITY shall request Trustee to reconvey the Security and shall surrender this
Deed of Trust and the Note to Trustee. Trustee shall reconvey the Security without warranty and
without charge to the person or persons legally entitled thereto. Such person or persons shall pay
all costs of recordation, if any.
17. Substitute Trustee. CITY, at its option, may from time to time remove Trustee
and appoint a successor trustee to any Trustee appointed hereunder. The successor trustee shall
succeed to all the title,power and duties conferred upon Trustee herein and by applicable law.
18. Notice. All notices, demands and requests which may be given, or which are
required to be given by any party to this Deed of Trust, and any exercise of a right of termination
provided by this Deed of Trust, shall be in writing and shall be deemed effective either: (1) on
the third (3'a) business day after being sent, by certified or registered mail, return receipt
requested, addressed to the intended recipient at the address specified below; (2) on the first (0)
business day after being deposited into the custody of a nationally recognized overnight delivery
service (i.e., FedEx Corporation, UPS, or DHL) addressed to such party at the address specified
below; or (3) on the business day sent via electronic mail in Portable Document Format (PDF)
with confirmation of receipt, in which case notice shall be deemed delivered upon receipt of
confirmation of receipt. For purposes of this section, the addresses of the parties for all notices
are as follows:
If to PS HOUSING: PS Housing Investors, LP
Attn.: Andrew Hanna, President
Global Premier Development, Inc.,
General Partner of PS Housing, LP
2010 Main Street, Suite 1250,
Irvine, CA 92614
If to CITY: City of Palm Springs
Attn.: City Manager
3200 E. Tahquitz Canyon Way
Palm Springs, CA 92262
19. Governing Law. This Deed of Trust shall be governed by the laws of the State of
California.
20. Severability. Every provision of this Deed of Trust is intended to be severable.
In the event any term or provision hereof is declared to be illegal or invalid for any reason
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whatsoever by a court or other body of competent jurisdiction, such illegality or invalidity shall
not affect the balance of the terms and provisions hereof, which terms and provisions shall
remain binding and enforceable. If the lien of this Deed of Trust is invalid or unenforceable as to
any part of the debt, or if the lien is invalid or unenforceable as to any part of the Security, the
unsecured or partially secured portion of the debt, and all payments made on the debt, whether
voluntary or under foreclosure or other enforcement action or procedure, shall be considered to
have been first paid or applied to the full payment of that portion of the debt which is not secured
or partially secured by the lien of this Deed of Trust.
21. Captions. The captions and headings in this Deed of Trust are for convenience
only and are not to be used to interpret or define the provisions hereof.
22. . Exhibits. Any exhibits referred to in this Deed of Trust are incorporated in this
Deed of Trust by such reference.
23. Subordination. This Deed of Trust shall be automatically subordinate to a deed
of trust, to be executed by PS HOUSING or PS HOUSING's successor in interest and recorded
in Orange County, California, to secure a loan (hereafter referred to as a "construction loan")
obtained for the purpose of the construction of the rehabilitation work on the Property, provided
that the conditions listed below are satisfied. For purposes of this Deed of Trust, "construction
loan" shall include any advance of funds to PS HOUSING by the lender for the purpose of the
construction of the rehabilitation work on the Property and secured by a lien on the Property,
whether in the form of a mortgage, deed of trust, or other security instrument in favor of the
lender. The following are the conditions to this subordination:
a. At the time of recordation of the deed of trust securing the construction loan, no
unrescinded Notice of Default of this Deed of Trust appears of record.
b. Any funds derived from the construction loan secured by the Property shall be
used only for the construction of improvements on the Property and, to the extent
permitted in this Deed of Trust, for the payment of loan fees, interest, or charges
directly connected with the construction of improvements on the Property.
"Construction of improvements" as used in this Deed of Trust shall mean the
rehabilitation work associated with the Cottage Industries project, including the
actual costs of labor and materials to rehabilitate the structures on the Property
with the usual appurtenances, including parking facilities, driveway, and fencing;
aggregate costs of general improvements, including engineering fees, architectural
fees, drafting fees, and permit and inspection fees.
C. The total amount of the construction loan shall not exceed thirty (30) percent of
the anticipated value of the Property after completion of the construction of
improvements financed by the construction loan, as determined by the lender. For
example, if the value of the Property is estimated at$4 million after completion of
the rehabilitation work, the construction loan shall not exceed $1.2 million.
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1271969.2
d. No portion of the construction loan shall be used to pay loan fees, interest, or
other charges not directly connected with the construction of improvements on the
Property.
e. The proceeds of the construction loan shall be disbursed by the Lender either
through its own offices or through a bonded disbursement control agency only
after inspection of the work completed on the Property and presentation of
vouchers signed by PS HOUSING or its successors in interest for the cost of
work, labor, or materials actually performed or used in the construction of
improvements on the Property.
f. The remaining terms and provisions of the construction loan shall be as required
by the Lender.
CITY shall, within fifteen (15) days after receipt of a written request therefor from PS
HOUSING, execute a separate agreement of subordination, in recordable form, in favor of the
construction loan to which this Deed of Trust is hereby subordinated, and deliver the
subordination agreement to the lender or the lender's title company designated by PS HOUSING.
The terms of any such subordination agreement shall prevail over the subordination provisions
provided for in this Deed of Trust. CITY's City Manager shall have authority to approve and
execute such subordination agreement.
IN WITNESS WHEREOF, PS HOUSING has executed this Deed of Trust as of the date
first written above.
PS HOUSING INVESTORS, LP
a California limited partnership
By: Andrew Hanna
Its: President of GI Premier opment, Inc.,
General Partner
Date: 0 -
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1271969.2
EXMBIT A TO DEED OF TRUST
LEGAL DESCRIPTION OF PROPERTY
All that certain real property situated in the City of Palm Springs, County of Riverside, State of
California, described as follows:
Parcel A:
Lots 33 and 34 of Palm Springs Estates No. 3, in the City of Palm Springs, County of
Riverside, State of California, as per map recorded in Book 17, Page 34, of Maps, in the
Office of the County Recorder of said County,
Except the East 4.50 feet.
Also Except the right to any deposit of oil, gas or other hydrocarbon substances
underlying said land, as reserved by California Trust Company, a Corporation, in deed
recorded February 28, 1929 in Book 801, Page 81 of Deeds,records of Riverside County,
California
Parcel B:
Lots 35 and 36 of Palm Springs Estates No. 3, in the City of Palm Springs, County of
Riverside, State of California, as per map recorded in Book 17, Page 34, of Maps, in the
Office of the County Recorder of said County.
Excepting therefrom that portion conveyed to the city of palm springs, by deed recorded
April 22, 1953 in Book 2258, Page 431 of Official Records of Riverside County,
California.
Also Excepting the right to any deposit of oil, gas or other hydrocarbon substances
underlying said land, as reserved by California Trust Company, a Corporation, in deeds
recorded March 29, 1932 in Book 70, Page 394 of Official Records of Riverside county,
California, as to said Lot 1, and recorded February 28, 1929 in Book 302, Page 4 of
Deeds, records of Riverside County, California, as to said Lots 35 and 36.
Parcel C:
Lots 32 of Palm Springs Estates No. 3, in the City of Palm Springs, County of Riverside,
State of California, as per map recorded in Book 17, Page 34, of Maps, in the Office of
the County Recorder of said County.
Except the right to any deposit of oil, gas or other hydrocarbon substances underlying
said land, as reserved by California Trust Company, in deed recorded February 19, 1929
in Book 798, Page 465 of Deeds,records of Riverside County, California.
Assessor's Parcel Nos.505-184-019,020,027
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1271969.2
A notary public or other officer completing this certificate verifies only the identity of the
individual who signed the document to which this certificate is attached, and not the
truthfulness, accuracy, or validity of that document.
STATE OF CALIFORNIA )
COUNTY OF
On O:T03 ram,2 k o 2017,before me, Cai>-z�A Notary
Public, personally appeared Andrew Hanna, who proved to me on the basis of satisfactory
evidence to be the person whose name is subscribed to the within instrument and acknowledged
to me that he executed the same in his authorized capacity, and that by his signature on the
instrument the person, or the entity upon behalf of which the person acted, executed the
instrument.
I certify UNDER PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Q Oj
GINA ELDUAYEN Signatu e
(seal) Commission#2080198
Notary Public-California z
Orange County
Comm n"8 27 201A CT�
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1271969.2 \�
PROMISSORY NOTE SECURED BY DEED OF TRUST
Principal Amount: $1,500,000.00
November 1, 2017
FOR VALUE RECEIVED, the undersigned, PS HOUSING INVESTORS, LP, a California
limited partnership ('Borrower") promises to pay to the City of Palm Springs, a California
municipal corporation ("City") or to order at City of Palm Springs, 3200 E. Tahquitz Canyon
Way, Palm Springs, California, 92262, or such other place as City may designate in writing, the
principal sum of ONE MILLION FIVE HUNDRED THOUSAND DOLLARS ($1,500,00.00)
plus interest, as set forth below, on the terms specified below.
1. Agreement. This Note is given in accordance with that certain Settlement
Agreement, as defined hereafter. The obligations of the Borrower under this Note shall be
subject to the terms of the Deed of Trust of even date herewith, which secures performance
under this Note.
2. Definitions. The terms set forth in this section shall have the following meanings
in this Note. Capitalized terms not defined in this Note shall have the same meanings as defined
in the Deed of Trust, the terms of which are incorporated into this Note by this reference.
(a) 'Deed of Trust" shall mean that certain Deed of Trust, of even date herewith,
executed by Borrower for the benefit of City, which Deed of Trust secures the obligations of this
Note.
(b) "Loan" shall mean the loan in the amount of$1,500,000.00 by City to Borrower,
which Loan is the subject of this Note.
(c) "Note" shall mean this Promissory Note Secured by Deed of Trust.
(d) "Parties" shall mean City and Borrower.
(e) "Property" shall mean that certain real property located at 14333-1455 N. Indian
Canyon Drive, City of Palm Springs, Riverside County, State of California, Assessor Parcel
Numbers 505-184-019, 020 and 027, together with all improvements, and fixtures now or
hereafter constructed, placed or located on the Property.
(f) "Settlement Agreement" shall mean that certain Settlement Agreement and
Release of All Claims, of even date herewith between City, the Successor Agency to the
Community Redevelopment Agency of the City of Palm Springs, and Borrower.
(g) "Term" shall mean the term of this Note, which shall begin on the date first set
forth above and shall end on November 1, 2019.
3. Repayment.
(a) Monthly Interest-Only Payments. Starting on November 1, 2017, and continuing
thereafter from month-to-month until November 1, 2019, when principal and accrued interest
thereon, if any, are due and payable, Borrower shall make monthly payments to City, or to order,
in advance on the first day of each calendar month, of interest only at the rate of three percent per
annum (3%) computed on the basis of a 360-day year, 30-day month, in the amount of Three
Thousand Seven Hundred Fifty Dollars and No Cents ($3,750.00).
(b) Repayment in Full. At the end of the Term of this Note, the entire unpaid
principal balance and all accrued interest, if any, shall be due and payable. Furthermore,the total
amount of the unpaid principal owed under this Note shall immediately become due and payable
in the event of a default by Borrower under this Note or the Deed of Trust. Failure to declare
such amounts due shall not constitute a waiver on the part of City to declare them due in the
event of a subsequent default.
(c) Terms of Payment. All amounts due and payable under the Note are payable at
the Office of City at the address provided above, or at such other place or places as City may
designate to Borrower in writing from time to time. Any payment under this Note shall be paid in
currency of the United States of America, which at the time of payment is lawful for the payment
of public and private debts and which on the respective dates on which such payments are due
shall be in immediately available funds.
(d) Prepayments. Borrower may prepay all or part of the principal balance plus
applicable interest due under this Note without penalty.
4. Prohibition Against Transfer of Interest. Borrower shall not make any transfer,
sale, assignment or conveyance, or transfer in any other form, other than in accordance with the
terms of this Note or the Deed of Trust. If any such transfer is made, all amounts due under this
Note shall become immediately due and payable without further notice by City, as set forth
herein. The following events shall not be considered a transfer of interest: (a) a change in
ownership of Borrower as a result of a merger, consolidation, reorganization, or joint venture; (b)
the sale, exchange, issuance, or other transfer of Borrower's stock on a national exchange or
between Borrower's parent company, if any, and any subsidiary, affiliate, related entity, or other
entity that controls, is controlled by, or is under common control with Borrower; (c) the Transfer
of this Agreement to Borrower's parent entity, if any, or any subsidiary, affiliate, related entity,
an entity that controls, is controlled by, or is under common control with Borrower; or (d) a
collateral assignment of Borrower's interest in this Note to a lender as security for any
indebtedness of Borrower to the lender. Borrower shall not be required to obtain City's consent
and City shall have no right to delay, alter, or impede any of the foregoing transactions or
combinations thereof, but such transfer of interest shall be effective only upon not less than sixty
(60) days written notice to City.
5. Security. The Deed of Trust, dated the same date as this Note, secures this Note.
6. Waivers.
(a) Borrower expressly agrees that this Note or any payment hereunder may be
extended from time to time at City's sole discretion and that City may accept security in
consideration for any such extension or release any security for this Note at its sole discretion all
without in any way affecting the liability of Borrower.
(b) No extension of time for payment of this Note or any installment hereof made by
agreement by City with any person or party now or hereafter liable for payment of this Note shall
operate to release, discharge, modify, change, or affect the original liability of Borrower under
this Note, either in whole or in part.
(c) The obligations of Borrower under this Note shall be absolute and Borrower
waives any and all rights:
(i) to offset, deduct, or withhold any payments or charges due under this Note for any
reasons whatsoever;
(ii) of presentment for payment, demand, protest and notices of dishonor and protest
made by City; and
(iii) with respect to City's diligence in taking any action to collect any sums owing
under this Note or in proceeding against any of City's rights and interests in and to
properties securing payment of this Note.
7. Attorney Fees and Costs. Borrower agrees, that if any amounts due under this
Note are not paid when due, in addition to any such past due amounts, Borrower shall pay, all
costs and expenses of collection and reasonable attorney fees paid or incurred by City in
connection with the collection or enforcement of this Note; whether or not suit is filed.
8. Joint and Several Obligations. This Note is the joint and several obligation of all
makers, sureties, guarantors, and endorsers, and shall be binding upon them and their successors
and assigns.
9. Deed of Trust Acceleration. This Note is secured by a Deed of Trust on the
Property. The Deed of Trust provides for acceleration of the payments due under this Note, along
with applicable interest, as set forth in Section 10, below, in the event of default (after expiration
of any applicable cure period) under the Deed of Trust or this Note.
10. Default. Borrower shall be in default under this Note if Borrower: (i) fails to pay
any money when due under this Note; (ii) breaches any representation or covenant made in this
Note in any material respect; or (iii) breaches any provision of the Deed of Trust.
All covenants, conditions, and agreements contained in this Note and the Deed of Trust
are hereby made a part of this Note, and Borrower agrees that the unpaid balance of the then
principal amount of this Note, together with all charges owing, shall, at the option of City hereof,
become immediately due and payable, and thereafter until paid bear interest at the rate of ten
percent (10%) per annum ('Default Rate"), compounded annually upon the failure of the
Borrower to make any payment hereunder, as and when due (after expiration of any applicable
cure period); upon the failure of Borrower to perform or observe any other term or provision of
this Note; or upon the occurrence of any event (whether termed default, event of default, or
similar term) which (after the expiration of any applicable cure period) under the terms of this
Note or the Deed of Trust shall entitle City to exercise rights or remedies thereunder.
11. Governing Law. This Note shall be construed in accordance with and be
governed by the laws of the State of California.
12. Severability. If any provision of this Note shall be invalid, illegal, or
unenforceable, the validity, legality, and enforceability of the remaining provisions hereof shall
not in any way be affected or impaired thereby.
13. Time. Time is of the essence in this Note.
14. No Waiver by City. No waiver of any breach, default, or failure of condition
under the terms of this Note or the Deed of Trust or the obligations secured thereby shall be
implied from any failure of City to take, or any delay by City in taking, action with respect to
such breach, default or failure, or any form of previous waiver of any similar or unrelated breach,
default or failure; and waiver of any term of this Note or the Deed of Trust or any of the
obligations secured thereby must be made in writing and shall be limited to the express written
terms of such waiver.
15. Amendments and Modifications. This Note may not be changed orally, but only
by an amendment in writing signed by Borrower and City.
16. Notices. All notices required in this Note shall be sent in accordance with Section
18 of the Deed of Trust.
IN WITNESS WHEREOF, Borrower has executed this Promissory Note as of the day
and year first above written.
PS HOUSING IN STOR LP
o
By'7'AttTrew Hanna Date
President, Global Premier Development, Inc,
General Partner
RECORDING REQUESTED BY: 2017 0482148
&WHEN RECORDED MAIL TO: 11/17/2017 08:37 AM Fee: $ 0.00
Page 1 of 3
City of Palm Springs Recorded in Official Records
County of Riverside
3200 E. Tahquitz Canyon Way Peter Alld�dar�na dd'' 1 4`II�� f�,J
P. O. Box 2743 Assessor-County
+IL4 Ph�� 'III
Palm Springs, CA 92263-2743 � �� �, I
Attention: City Clerk
APN: 505-184-019, 020, 027 (SPACE ABOVE THIS LINE FOR RECORDER'S USE ONLY) �J
No fee document pursuant to
Government Code Section 27383
SUBSTITUTION OF TRUSTEE AND FULL RECONVEYANCE
Whereas, PS HOUSING INVESTORS, LP, a California Limited Partnership is the Original Trustor,
LAWYERS TITLE COMPANY, the Original Trustee, and the COMMUNITY REDEVELOPMENT
AGENCY OF THE CITY OF PALM SPRINGS, a public body,the Original Beneficiary, under that certain
Deed of Trust and Assignment of Rents dated July 19, 2012 and recorded on July 26, 2012, as Doc. No.
2012-0350178, of Official Records of Riverside County, California, pertaining to that real property in the
City of Palm Springs, State of California and legally described as:
Parcel A:
Lots 33 and 34 of Palm Springs Estates No. 3, in the City of Palm Springs, County of
Riverside, State of California, as per map recorded in Book 17, Page 34, of Maps, in the
Office of the County Recorder of said County,
Except the East 4.50 feet.
Also Except the right to any deposit of oil, gas or other hydrocarbon substances underlying
said land, as reserved by California Trust Company, a Corporation, in deed recorded
February 28, 1929 in Book 801,Page 81 of Deeds, records of Riverside County, California
Parcel B:
Lots 35 and 36 of Palm Springs Estates No. 3, in the City of Palm Springs, County of
Riverside, State of California, as per map recorded in Book 17, Page 34, of Maps, in the
Office of the County Recorder of said County.
Excepting therefrom that portion conveyed to the city of palm springs, by deed recorded
April 22, 1953 in Book 2258, Page 431 of Official Records of Riverside County,
California.
Also Excepting the right to any deposit of oil, gas or other hydrocarbon substances
underlying said land, as reserved by California Trust Company, a Corporation, in deeds
recorded March 29, 1932 in Book 70, Page 394 of Official Records of Riverside county,
California, as to said Lot 1, and recorded February 28, 1929 in Book 302, Page 4 of Deeds,
records of Riverside County, California, as to said Lots 35 and 36.
I
1271966.1
Parcel C:
Lots 32 of Palm Springs Estates No. 3, in the City of Palm Springs, County of Riverside,
State of California, as per map recorded in Book 17, Page 34, of Maps, in the Office of the
County Recorder of said County.
Except the right to any deposit of oil, gas or other hydrocarbon substances underlying said
land, as reserved by California Trust Company, in deed recorded February 19, 1929 in
Book 798, Page 465 of Deeds, records of Riverside County, California.
Assessor's Parcel Nos. 505-184-019, 020,027
Whereas, the note secured by said Deed of Trust, together with all other indebtedness secured by said
Deed of Trust,has been cancelled;
Whereas, the Community Redevelopment Agency of the City of Palm Springs was dissolved by the State
of California and the City of Palm Springs became the legal successor agency to the same;
Whereas, the undersigned City of Palm Springs as successor to the Original Beneficiary, hereby appoints
and substitutes itself as Trustee in lieu of the Original Trustee;
Whereas, the undersigned hereby accepts said appointment as trustee under the above Deed of Trust, and
as successor Trustee, and pursuant to the request of said owner and holder and in accordance with the
provisions of said Deed of Trust, DOES HEREBY RECONVEY WITHOUT WARRANTY, TO THE
PERSON OR PERSONS LEGALLY ENTITLED THERETO, all the estate, title and interest now held
by it under said Deed of Trust.
Dated Mp BENEFICIARY AND SUBSTITUTED TRUSTEE
CITY OF PALM SPRINGS, a charter city and municipal
corporation
By:
fs?.bC City Manager
ATTEST:
APPROVED BY CITY COUNCIL
K�anwt city Clerk`T � (D q 11 AIM
Appro to form:
c
City Attorney
2
1271966.1
ACKNOWLEDGMENT OF INSTRUMENT
(Cal. Civil Code Section 1181)
A notary public or other officer completing this certificate verifies only the identity of the
individual who signed the document to which this certificate is attached, and not the
truthfulness, accuracy, or validity of that document.
State of California )
County of Riverside ) SS.
City of Palm Springs )
On October 25, 2017, before me, KATHLEEN D. HART, INTERIM CITY CLERK,
CITY OF PALM SPRINGS, CALIFORNIA, personally appeared DAVID H. READY, who I personally
know is the CITY MANAGER of the CITY OF PALM SPRINGS whose name is subscribed to the
within instrument and acknowledged to me that he executed the same in his official and authorized
capacity on behalf of the City of Palm Springs, a California Charter City.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
Witness my hand and the official seal of the City of Palm Springs, California, this 25th day of
October, 2017.
�OF?ALM SAP
�Z
v N
'-�Signature: L. q</FOR��
KATHLEEN D. HART, MMC
Interim City Clerk
Title or Type of Document
Substitution of Trustee and Full Reconveyance
RECORDING REQUESTED BY: 2017-0482147
&WHEN RECORDED MAIL TO:
11/17/2017 08:37 AM Fee: $ 0.00
Page 1 of 3
City of Palm Springs
Recorded in Official Records
3200 E. Tahquitz Canyon Way County of Riverside
Peter Aldana
P. 0. Box 2743 Assessor-County Clerk-Recorder
Palm Springs, CA 92263-2743 III16" hry111 h Ill Attention: City Clerk
11
APN: 505-184-019, 020, 027 (SPACE ABOVE THIS LINE FOR RECORDER'S USE ONLY)
No fee document pursuant to
Government Code Section 27383
SUBSTITUTION OF TRUSTEE AND FULL RECONVEYANCE
Whereas, PS HOUSING INVESTORS, LP, a California Limited Partnership is the Original Trustor,
LAWYERS TITLE COMPANY, the Original Trustee, and the COMMUNITY REDEVELOPMENT
AGENCY OF THE CITY OF PALM SPRINGS, a public body, the Original Beneficiary, under that certain
Deed of Trust and Assignment of Rents dated August 3, 2011 and recorded on August 25, 2011, as Doc.
No. 2011-037701 I, of Official Records of Riverside County, California, pertaining to that real property in
the City of Palm Springs, State of California and legally described as:
Parcel A:
Lots 33 and 34 of Palm Springs Estates No. 3, in the City of Palm Springs, County of
Riverside, State of California, as per map recorded in Book 17, Page 34, of Maps, in the
Office of the County Recorder of said County,
Except the East 4.50 feet.
Also Except the right to any deposit of oil, gas or other hydrocarbon substances underlying
said land, as reserved by California Trust Company, a Corporation, in deed recorded
February 28, 1929 in Book 801, Page 81 of Deeds, records of Riverside County, California
Parcel B:
Lots 35 and 36 of Palm Springs Estates No. 3, in the City of Palm Springs, County of
Riverside, State of California, as per map recorded in Book 17, Page 34, of Maps, in the
Office of the County Recorder of said County.
Excepting therefrom that portion conveyed to the city of palm springs, by deed recorded
April 22, 1953 in Book 2258, Page 431 of Official Records of Riverside County,
California.
Also Excepting the right to any deposit of oil, gas or other hydrocarbon substances
underlying said land, as reserved by California Trust Company, a Corporation, in deeds
recorded March 29, 1932 in Book 70, Page 394 of Official Records of Riverside county,
California, as to said Lot 1, and recorded February 28, 1929 in Book 302,Page 4 of Deeds,
records of Riverside County, California, as to said Lots 35 and 36.
1
1271926.1
Parcel C:
Lots 32 of Palm Springs Estates No. 3, in the City of Palm Springs, County of Riverside,
State of California, as per map recorded in Book 17, Page 34, of Maps, in the Office of the
County Recorder of said County.
Except the right to any deposit of oil, gas or other hydrocarbon substances underlying said
land, as reserved by California Trust Company, in deed recorded February 19, 1929 in
Book 798, Page 465 of Deeds, records of Riverside County, California.
Assessor's Parcel Nos. 505-184-019, 020, 027
Whereas, the note secured by said Deed of Trust, together with all other indebtedness secured by said
Deed of Trust, has been cancelled;
Whereas, the Community Redevelopment Agency of the City of Palm Springs was dissolved by the State
of California and the City of Palm Springs became the legal successor agency to the same;
Whereas, the undersigned City of Palm Springs as successor to the Original Beneficiary, hereby appoints
and substitutes itself as Trustee in lieu of the Original Trustee;
Whereas, the undersigned hereby accepts said appointment as trustee under the above Deed of Trust, and
as successor Trustee, and pursuant to the request of said owner and holder and in accordance with the
provisions of said Deed of Trust, DOES HEREBY RECONVEY WITHOUT WARRANTY, TO THE
PERSON OR PERSONS LEGALLY ENTITLED THERETO,all the estate,title and interest now held
by it under said Deed of Trust.
Dated BENEFICIARY AND SUBSTITUTED TRUSTEE
CITY OF PALM SPRINGS, a charter city and municipal
corporation
By:
C City Manager
ATTEST:
APPROVED BY CITY COUNCIL
1 c� StSSI �. A��ii�
1�6v*A City Clerk
Approv to form:
City Attorney
2
1271926.1
ACKNOWLEDGMENT OF INSTRUMENT
(Cal. Civil Code Section 1181)
A notary public or other officer completing this certificate verifies only the identity of the
individual who signed the document to which this certificate is attached, and not the
truthfulness, accuracy, or validity of that document.
State of California )
County of Riverside ) SS.
City of Palm Springs )
On October 25, 2017, before me, KATHLEEN D. HART, INTERIM CITY CLERK,
CITY OF PALM SPRINGS, CALIFORNIA, personally appeared DAVID H. READY, who I personally
know is the CITY MANAGER of the CITY OF PALM SPRINGS whose name is subscribed to the
within instrument and acknowledged to me that he executed the same in his official and authorized
capacity on behalf of the City of Palm Springs, a California Charter City.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
Witness my hand and the official seal of the City of Palm Springs, California, this 25th day of
October, 2017.
,.off Q ALM SpP
iZ
o
G7 N
Signature: !�. � � 4<lFoaN
KATHLEEN D. HART, MMC
Interim City Clerk
Title or Type of Document
Substitution of Trustee and Full Reconveyance
SETTLEMENT AGREEMENT AND RELEASE OF ALL CLAIMS
This Settlement Agreement and Release of All Claims(hereinafter"Agreement")is intended
by the Parties hereto to constitute an enforceable contract which fully resolves the disputes and
claims as set forth below.
I. The Parties
The Parties hereto are Plaintiffs City of Palm Springs,a California charter city and municipal
corporation, and the Successor Agency to the Community Redevelopment Agency of the City of
Palm Springs, a public body(Plaintiffs hereinafter are referred to as "Plaintiff"),and Defendant PS
Housing Investors, LP (hereinafter referred to as the "Defendant"). Plaintiff and Defendant are
hereinafter referred to collectively as the "Parties" to this Agreement. The City of Palm Springs is
hereinafter referred to as the"City."
II. The Action
On June 15, 2011, the City Council sitting as the Board of Directors of the former
Community Redevelopment Agency(RDA)approved a$1.5 million loan to the Defendant for the
development of a senior citizen low-moderate income housing development on property located at
1433-1455 North Indian Canyon Drive in the City of Palm Springs. The final funding agreement
was executed and funded on August 3, 2011, contemporaneously with the close of escrow of the
subject property acquired by the Defendant. However,on June 28,2011,the State adopted ABX 1-26
effectively dissolving the RDA as of February 1,2012. ABX 1-26 further prohibited and voided any
obligations created by the RDA after June 27,2011. The following year,on June 27,2012,the State
adopted AB 1484 to amend ABXI-26 and authorize the State Department of Finance to review
transactions of redevelopment agencies that occurred after January 1, 2011.
During the State's review of the RDA's transactions, the State determined that the funding
agreement was voided by ABXI-26 and ordered the City and Successor Agency to the RDA to
recover the funds loaned to the Defendant. The City and Successor Agency contested the State's
determination because the transaction had been approved by the RDA Board on June 15,2011,prior
to the adoption of ABX 1-26. However,the State held steadfast on its determination and on March 4,
2013 sent a final demand threatening to offset the $1.5 million from the City's and Successor
Agency's sales tax and property tax distributions. The City and Successor Agency filed a Petition for
Writ of Mandate and Complaint for Declaratory and Injunctive Relief against the State and
Defendant,along with multiple taxing agencies as parties in interest,on March 14,2013 challenging
the State's final determination and tax offset threat pertaining to the$1.5 million loan(City of Palm
Springs and Successor Agency to the Community Redevelopment Agency of the City of Palm
Springs vs. Ana Matosantos,et al.,Sacramento Superior Court Case No.34-2013-80001440). The
Complaint includes a cause of action for money had and received against the Defendant, which in
conjunction with the cause of action for declaratory relief,seeks an order from the court directing the
Defendant to return the$1.5 million should the court decide that the loan was voided by ABX 1-26.
The Court held a hearing on the Writ of Mandate on October 2, 2015 and found that the funding
agreement was voided by ABXI-26. The Court denied the writ and dismissed the State and public
1233978.3 1
entity defendants from the complaint. The Court further ordered the Parties to either(1)stipulate to
transfer venue of the remaining causes of action between the City/Successor Agency against the
Defendant to Riverside County;(2)brief the Court why it should not dismiss the remaining causes of
action; or(3) the City/Successor Agency file a motion to transfer venue to Riverside County. The
Parties agreed to stipulate to transfer venue to Riverside County and the Court on October 20,2015
ordered the remaining causes of action of the City/Successor Agency against Defendant transferred
to Riverside County(Riverside County Superior Court Case No. RIC 1513477).
The City has advanced the$1,500,000.00 payment to the State and taxing agencies.
It is understood and agreed that this settlement and Agreement is and represents a
compromise of a disputed claim,that neither the consideration nor the Releases made herein are to
be construed as admissions of either fact or liability on the part of any Party hereto.
The purpose of this Agreement is to fully,finally,and comprehensively settle and resolve all
matters, claims, and disputes, past, current, or future, relevant or related to the events, facts, and
circumstances set forth in the Action. Each Party,by entering into this Agreement merely intends to
avoid further litigation and, as a business decision,to buy its peace.
III. The Settlement
A. Plaintiff, as consideration for this settlement, hereby agrees and covenants to dismiss the
Action against the Defendant in its entirety,with prejudice, and to bear its own attorney's
fees and costs related to the Action. Defendant,as consideration for this settlement,hereby
agrees and covenants to bear its own attorney's fees and costs related to the Action, and
agrees to pay the City the sum of One Million Five Hundred Thousand dollars
($1,500.000.00) upon the sale of the property, but not later than two years from the full
execution of this Agreement. For the time commencing November 1,2017,and twenty-four
months thereafter,Defendant shall make interest payment only to the City at the rate of three
percent(3%)per annum. The payment obligation herein shall be evidenced by a promissory
note in the form attached hereto as Exhibit 1 and shall be secured by a deed of trust in the
form attached hereto as Exhibit 2. The first interest only payment on the note will be due
November 1,2017. Defendant will continue to market the property and will keep the City
informed of any viable offers.
B. The dismissal shall be filed within ten (10) business days after this Agreement is fully
executed by all parties.
C. In further consideration for the settlement and this Agreement,and for the promises set forth
above,the Parties,and each of them,do hereby enter into the following Release(hereinafter
referred to as the 'Release"). Said Parties,and each of them,do hereby and for themselves,
individually, and for each of their heirs, executors, administrators, successors, assigns,
attorneys,agents,employees,and partners,release,acquit,and forever discharge each of the
other Parties and each of those Parties'heirs,executors,administrators,successors,assigns,
attorneys, spouses, and past or present employees, agents, contractors, partners, officers,
1233578.3 2
representatives, Council Members, and servants (all collectively referred to hereinafter as
"Releasees") from any and all rights, claims, warranties, demands, debts, obligations,
liabilities,actions,damages,costs,expenses,and other claims whatsoever which they have
asserted or might have asserted against any or all of the Releasees by reason of any matter or
thing occurring,done,created, or happening, including, without limitation,those based on,
arising out of,or connected in any way with the Action.
IV. General Provisions
A. The Superior Court of the State of California for the County of Riverside shall retain
jurisdiction to enforce the terms of this Agreement pursuant to Code of Civil Procedure
section 664.6.
B. It is understood and agreed by the Parties hereto that the facts with respect to which the
foregoing Agreement is given may hereafter turn out to be other than,or different from,the
facts in that connection now known to be,or believed by the Parties hereto,or any of them,
to be true, and the Parties hereto expressly assume the risk of the facts turning out to be
different than they now so appear,and agree that the foregoing Release shall be effective in
all respects,and not subject to termination or rescission by any such difference in facts. The
Parties hereto,and each of them expressly acknowledge and waive any and all rights he,she,
or it has or may have under California Civil Code section 1542,which provides as follows:
"A general release does not extend to claims which the creditor does not know or
suspect to exist in his or her favor at the time of executing the Release, which if
known by him or her must have materially affected his or her settlement with the
debtor."
C. Each of the Parties acknowledges that(a)this Agreement is the result of extensive good faith
negotiations between them or it through their or its respective counsel;(b)each said counsel
has carefully reviewed and examined this Agreement for execution by his client;and(c)any
statute or rule of construction that ambiguities are to be resolved against the drafting party
should not be employed in the interpretation of this Agreement.
D. Each of the Parties hereto agree that he or it will forever refrain and forebear from
commencing,instituting,or prosecuting any lawsuit,action,or other proceeding against any
other Party hereto based on,arising out of,or in any way connected with the subject matter of
the Action to which this Agreement pertains.
E. Each of the Parties hereto represents and warrants to each Releasee that he or it has not
heretofore assigned or transferred, or purported to assign or transfer, to any person, firm,
corporation, association, or entity any of the rights, claims, warranties, demands, debts,
obligations, liabilities, action, damages, costs, expenses, or other claims whatsoever.
Furthermore, each Party agrees to indemnify and hold harmless each Releasee against and
from,without limitation,any and all rights,claims,warranties,demands,debts,obligations,
liabilities, actions, damages, costs, expenses, or other claims, including attorneys' fees,
1233578.3 3
arising out of, or connected with, any such assignment or transfer, or any such purported
assignment or transfer.
F. Each of the Parties hereto acknowledges that he or it has been represented by counsel of his
or its own choice in connection with the preparation and execution of this Agreement. Each
of the Parties hereto also acknowledge and represent that he or it has read this Agreement in
full, understands it, and voluntarily consents and agrees to each and every provision
contained herein.
G. Each of the Parties hereto further declares and represents that no promise, inducement, or
agreement not herein expressed has been made to him or it,that this Agreement contains the
entire agreement among the Parties hereto, and that the terms of this Agreement are
contractual and not a mere recital.
H. Each person executing this Agreement represents and warrants to each Party and each
Releasee that the execution and performance of the terms of this Agreement have been duly
authorized by all requisite corporate, partnership, individual, municipal, or other entity
requirements, and that each person executing this Agreement has the right, power, legal
capacity, and authority to execute and enter into this Release.
CITY OF PALM SPRING & PS HOUSING INVESTORS, LP
SUCCESSOR 1_.A/GEN2CY p
Dated N�� rX�T 17 2017 Dated d ! 2017
"`7-7David Ready, J.D., y: Andrew Ifanna, President, Global Premicr
City Manager Development, Inc., General Partner
APPROVED BY CITY COUNC
APPROVED AS TO FORM: e%ik q 1f
ill AIM
. oclates
By Edward Z. Kotkin By-vigridall K. Johnson, Esq.
City Attorney l!.
ATTEST: ( �
T„VAfA City Clerk
4
123,4i763
PROMISSORY NOTE
DO NOT DESTROY THIS NOTE: When paid, this note must be surrendered to
Borrower for cancellation.
$500,000.00 Palm Springs, California
1 1, 2011
FOR VALUE RECEIVED, the undersigned, PS HOUSING INVESTORS, LP, a
California Limited Partnership ("Maker"), promises to pay the COMMUNITY
REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, a public body,
corporate and politic ("Holder") at Community Redevelopment Agency of the City of
Palm Springs, 3200 Tahquitz Canyon Way, P.O. Box 2743, Palm Springs, CA 92263,
the sum of Five Hundred Thousand Dollars ($500,000.00), (the "Note Amount'),
together with interest thereon at the rate set forth herein. All sums payable hereunder
shall be payable in lawful money of the United States of America. This Promissory Note
("Agency Note") is made in connection with the provision by the Holder of funds equal to
the Agency Note pursuant to that certain the Owner Participation Agreement by and
among Maker and Holder, dated as of 2011 (the
"Agreement').
1. Interest Rate. Simple interest shall accrue on the Note Amount from the
date of disbursement at the rate of two percent (2%) per annum, or as determined
necessary to maximize the tax credit equity, but in no event greater than the maximum
interest rate permitted by law.
2. Repayment. Maker shall repay the principal amount of the Note Amount,
plus all interest then accrued at the interest rate set forth in Paragraph 1 above in
arrears, in annual installments in an amount equal to fifty percent of residual receipts
after the payment of customary expenses. The principal amount of the Note Amount,
plus all interest then accrued upon the Note Amount, shall be immediately due and
payable upon (i) any default of the Agreement, including without limitation the
conveyance of property not permitted by the Agreement, and Section 805, thereof,
which is not cured within the time set forth in Section 805 of the Agreement and, if not
sooner paid in full, (ii) on 12066.
3. Prepayment of Agency Note Amount. Maker may prepay to Holder the full
Note Amount, together with all accrued and unpaid interest thereon at the rate set forth
in Section 1 hereof, at any time prior to the due date of the Note Amount without
penalty.
4. Application of Payments. Each payment hereunder shall be credited first
to interest then accrued and the remainder, if any, to principal. Interest shall cease to
accrue upon principal so credited.
5. Securi This Agency Note is secured by a deed of trust by and between
Maker, as trustor and Holder, as beneficiary (the "Deed of Trust" Exhibit "G" to the
Agreement).
6. Holder May Assign. Holder may, at its option, assign its right to receive
payment under this Agency Note without necessity of obtaining the consent of the
Maker.
7. Maker Assignment Prohibited In no event shall Maker assign or transfer
any portion of this Agency Note without the prior express written consent of the Holder,
which consent may be given or withheld in the Holder's sole discretion.
8. Attorneys' Fees and Costs. In the event that any action is instituted with
respect to this Agency Note, the non-prevailing party promises to pay such sums as a
court may fix for court costs and reasonable attorneys' fees. Holder's right to such fees
shall not be limited to or by its representation by Agency Counsel, and such
representation shall be valued at customary and reasonable rates for private sector
legal services.
9. Non-Waiver. Failure or delay in giving any notice required hereunder shall
not constitute a waiver of any default or late payment, nor shall it change the time for
any default or payment.
10. Successors Bound. This Agency Note shall be binding upon the parties
hereto and their respective heirs, successors and assigns.
11. Terms. Any terms not separately defined herein shall have the same
meanings as set forth in the Agreement.
12. Collection of Penalties. No provision of this Agency Note or any
instrument securing payment hereof or otherwise relating to the debt evidenced hereby
shall require the payment or permit the collection of interest in excess of the maximum
permitted by applicable law. If any excess of interest in such respect is herein or in
such other instrument provided for, or shall be adjudicated to be so provided for herein
or in any such instrument, the provisions of this paragraph shall govern, in neither
Maker or any endorsers of this Note, nor their respective heirs, personal
representatives, successors or assigns shall be obligated to pay the amount of such
interest to the extent it is in excess of the amount permitted by applicable law.
13. Non-Recourse. Notwithstanding anything to the contrary herein
contained, (i) the liability of Maker shall be limited to its interest in the Site and any
rents, issues, and profits arising from the Site and, in addition, with respect to any
obligation to hold and apply insurance proceeds, proceeds of condemnation or other
monies hereunder, any such monies received by it to the extent not so applied in
accordance with the terms of this Note; (ii) no other assets of Maker shall be affected by
or subject to being applied to the satisfaction of any liability which Maker may have to
Holder or to another person by reason of this Note; and (iii) any judgment, order, decree
or other award in favor of Holder shall be collectible only out of, or enforceable in
accordance with, the terms of this Note by termination or other extinguishment of
Maker's interest in the Site. Notwithstanding the foregoing, it is expressly understood
and agreed that the aforesaid limitation on liability shall in no way restrict or abridge
Maker's continued personal liability for: (A) fraud or willful or grossly negligent
misrepresentation made by Maker in connection with this Note or any of the Agency
Agreements; (B) misapplication of (a) proceeds of insurance and condemnation or (b)
rent received by Maker under rental agreements entered into for any portion of the Site
after default of the Note; (C) the retention by Maker of all advance rentals and security
deposits of tenants not refunded to or forfeited by such tenants; or (D) the
indemnification undertakings of Maker under the Agency Agreements.
IN WITNESS W Borrower has caused this Note to be executed by
Maker or Maker's a rized gent(s) as of the date and year first above written.
M
By:
E5iHousing Investors, LP
PROMISSORY NOTE
DO NOT DESTROY THIS NOTE: When paid, this note must be surrendered to
Borrower for cancellation.
$1,000,000.00 Palm Springs, California
f 1, 2011
FOR VALUE RECEIVED, the undersigned, PS HOUSING INVESTORS, LP, a
California Limited Partnership ("Maker"), promises to pay the COMMUNITY
REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, a public body,
corporate and politic ("Holder") at Community Redevelopment Agency of the City of
Palm Springs, 3200 Tahquitz Canyon Way, P.O. Box 2743, Palm Springs, CA 92263,
the sum of One Million Dollars ($1,000,000.00), (the "Note Amount"), together with
interest thereon at the rate set forth herein. All sums payable hereunder shall be
payable in lawful money of the United States of America. This Promissory Note
("Agency Note") is made in connection with the provision by the Holder of funds equal to
the Agency Note pursuant to that certain the Owner Participation Agreement by and
among Maker and Holder, dated as of 2011 (the
"Agreement').
1. Interest Rate. Simple interest shall accrue on the Note Amount from the
date of disbursement at the rate of two percent (2%) per annum, or as determined
necessary to maximize the tax credit equity, but in no event greater than the maximum
interest rate permitted by law.
2. Repayment. Maker shall repay the principal amount of the Note Amount,
plus all interest then accrued at the interest rate set forth in Paragraph 1 above in
arrears, in annual installments in an amount equal to fifty percent of residual receipts
after the payment of customary expenses. The principal amount of the Note Amount,
plus all interest then accrued upon the Note Amount, shall be immediately due and
payable upon (i) any default of the Agreement, including without limitation the
conveyance of property not permitted by the Agreement, and Section 805, thereof,
which is not cured within the time set forth in Section 805 of the Agreement and, if not
sooner paid in full, (ii) on 2066.
3. Prepayment of Agency Note Amount Maker may prepay to Holder the full
Note Amount, together with all accrued and unpaid interest thereon at the rate set forth
in Section 1 hereof, at any time prior to the due date of the Note Amount without
penalty.
4. Application of Payments. Each payment hereunder shall be credited first
to interest then accrued and the remainder, if any, to principal. Interest shall cease to
accrue upon principal so credited.
M
5. Securi . This Agency Note is secured by a deed of trust by and between
Maker, as trustor and Holder, as beneficiary (the "Deed of Trust" Exhibit "G" to the
Agreement).
6. Holder May Assign. Holder may, at its option, assign its right to receive
payment under this Agency Note without necessity of obtaining the consent of the
Maker.
7. Maker Assignment Prohibited. In no event shall Maker assign or transfer
any portion of this Agency Note without the prior express written consent of the Holder,
which consent may be given or withheld in the Holder's sole discretion.
8. Attorneys' Fees and Costs. In the event that any action is instituted with
respect to this Agency Note, the non-prevailing party promises to pay such sums as a
court may fix for court costs and reasonable attorneys' fees. Holder's right to such fees
shall not be limited to or by its representation by Agency Counsel, and such
representation shall be valued at customary and reasonable rates for private sector
legal services.
9. Non-Waiver. Failure or delay in giving any notice required hereunder shall
not constitute--a—waiver of any default or late payment, nor shall it change the time for
any default or payment.
10. Successors Bound. This Agency Note shall be binding upon the parties
hereto and their respective heirs, successors and assigns.
11. Terms. Any terms not separately defined herein shall have the same
meanings as set forth in the Agreement.
12. Collection of Penalties. No provision of this Agency Note or any
instrument securing payment hereof or otherwise relating to the debt evidenced hereby
shall require the payment or permit the collection of interest in excess of the maximum
permitted by applicable law. If any excess of interest in such respect is herein or in
such other instrument provided for, or shall be adjudicated to be so provided for herein
or in any such instrument, the provisions of this paragraph shall govern, in neither
Maker or any endorsers of this Note, nor their respective heirs, personal
representatives, successors or assigns shall be obligated to pay the amount of such
interest to the extent it is in excess of the amount permitted by applicable law.
13. Non-Recourse. Notwithstanding anything to the contrary herein
contained, (i) the liability of Maker shall be limited to its interest in the Site and any
rents, issues, and profits arising from the Site and, in addition, with respect to any
obligation to hold and apply insurance proceeds, proceeds of condemnation or other
monies hereunder, any such monies received by it to the extent not so applied in
accordance with the terms of this Note; (ii) no other assets of Maker shall be affected by
or subject to being applied to the satisfaction of any liability which Maker may have to
Holder or to another person by reason of this Note; and (iii) any judgment, order, decree
or other award in favor of Holder shall be collectible only out of, or enforceable in
accordance with, the terms of this Note by termination or other extinguishment of
Maker's interest in the Site. Notwithstanding the foregoing, it is expressly understood
and agreed that the aforesaid limitation on liability shall in no way restrict or abridge
Maker's continued personal liability for: (A) fraud or willful or grossly negligent
misrepresentation made by Maker in connection with this Note or any of the Agency
Agreements; (B) misapplication of (a) proceeds of insurance and condemnation or (b)
rent received by Maker under rental agreements entered into for any portion of the Site
after default of the Note; (C) the retention by Maker of all advance rentals and security
deposits of tenants not refunded to or forfeited by such tenants; or (D) the
indemnification undertakings of Maker under the Agency Agreements.
IN WITNESS WHEREOF, Borrower has caused this Note to be executed by
Maker or Maker's authorized agent(s) as of the date and year first above written.
Maker:
By
.
S Wousine LP
Fo m W-9 Request for Taxpayer Give form to the
(Re¢Ootobere Ttea Identification Number and Certification requester.Donut
DepvCnmt of the Treasury send to the IRS.
Internal Revenue Bernice
Narrue. shownlncoe tax return)
A ✓�S L ,
fa Business name,if different from above
R
6
C
O
oCheck appropriate box: ❑Individual/Sole proprietor Corporation Partnership
Limited liabilitycompany.Enter the a classification(D=disre arded entity,C=corpo ration,P=partnership) ►_ Exempt
s
El other(see instructions) ► p Yee
Address(number,street end apt.or wire no.) Requesters name and address(optional)
Zo! a Mlq-r ✓ SL SM. iaso
rn City,state,and ZIP code
List atccunt numbers here(optional)
Part I Tax a er Identification Number IN
Enter your TIN in the appropriate box.The TIN provided must match the name given on Line 1 to avoid
backup withholding.Far individuals,this is your social security number(SSN).However,for a resident social security number
alien,sole proprietor,or disregarded entity,see the Part I instructions on page 3.Far other entities,it is
your employer identification number(EIN).If you do not have a number,see How to get a Tfly on page 3. or
Note.If the account is in more than one name,we the chart on page 4 for guidelines on whose I Employer Iderdlficaden number
number to enter.
y5-2903N 6 3
Part 111 Certification
Under penalties of perjury,I certify that:
1. The number shown on this farm is my correct taxpayer identification number(or I am waiting for a number to be issued to me),and
2. 1 am not subject to backup withholding because:(a)I am exempt from backup withholding,or(b)I have not been notified by the Internal
Revenue Service(IRS)that I am subject to backup withholding as a result of a failure to report all interest or dividends,or(c)the IRS has
notified me that I am no longer subject to backup withholding,and
3. 1 am a U.S.citizen Of other U.S.person(defined below).
Certification instructions. You must cross out item 2 above if you have been notlfled by the IRS that you are currently subject to backup
withholding because you have falled to report all interest and dividAnds on your tax realm. For real estate transactions,item 2 does not apply.
For mortgage interest paid, acquisition or aband ment of d property, cancellation of debt, contributions to an individual retirement
arrangement(IRA), and generally, payments r than ' and dividends, you are rot required to sign the Certification,but you must
provide your correct TIN.See the instmctio peg
Sign signature or tf
Here Us.person `-- - Date ►
General Instructions Definition of a U.S.person.For federal tax purposes,you are
considered a U.S.person if you are:
Section references are to the Internal Revenue Code unless otherwise noted. s An individual who is a U.S.citizen or U.S. resident alien,
Purpose of Form a A partnership,corporation,company,or association created or
organized in the United States or under the laws of the United
A person who is required to file an information return with the States,
IRS,must obtain your correct taxpayer identification number •An estate(other than a foreign estate),or
(TIN)to report, for example,income paid to you, real estate
transactions, mortgage interest you paid,acquisition or •A domestic trust(as defined in Regulations section
abandonment of secured property,cancellation of debt,or 301.7701-7).
contributions you made to an IRA. Special miss for partnerships.Partnerships that conduct a
Use Form W-9 only if you are a U.S.person(including a trade or business in the United States are generally required to
resident alien),to provide your correct TIN to the person pay a withholding tax on any foreign partners'share of income
requesting it(the requester)and,when applicable,to: from such business.Further,in certain cases where a Form W-9
1. Certify that the TIN has not been received,a partnership is required to presume that
fly you are giving is correct(or you are a partner is a foreign person,and pay the withholding tax.
wailing for a number to be issued), Therefore,if you are a U.S.person that is a partner in a
2. Certify that you are not subject to backup withholding,or partnership conducting a trade or business in the United States,
3. Claim exemption from backup withholding if you are a U.S. provide Form W-9 to the partnership to establish your U.S.
exempt payee. If applicable,you are also certifying that as a status and avoid withholding on your share of partnership income.
U.S.person,your allocable share of any partnership income from The person who gives Form W-9 to the partnership for
a U.S.trade or business is not subject to the withholding tax on purposes of establishing its U.S.status and avoiding withholding
foreign partners'share of effectively connected Income. on its allocable share of net income from the partnership
Note. If a requester gives you a form other than Form W-9 to conducting a trade or business in the United States is in the
request your TIN,you must use the requesters form if it Is following cases:
substantially similar to this Form W-9. a The U.S.owner of a disregarded entity and not the entity,
Calyx Form-TaM9l me(11/P7) Cat.No.10231x FormW-9(Rev.10.201)7)
10-10-12;04:07PM; # 2/ 14
DOC#2012-0350178 IIII
07/26QD12 08:00 AM Fees:$81.00
AECORDINO WUESfED BY R corded n2 COMMUNITY RED AGENCY Official Records
County of MveFside
AND WHEN RECORDED MAIL TO Larry W.Ward
OOMINUNITY RLD AGENCY Aneseor,County Clerk 6 Recorder
s T U17Z CA ON WAY
PALM SPRINGS,CA 92263 "This dooument,was elacoonmay
to the County of Rlverslde far reoordng" j
ATTN:EXECUTIVE A RE(7OR Rece0ed by YSEGUR4
SPACE ABOVE FOR RECORDER'S USE ONLY
DEED OF TRUST AND ASSIONMENT OF RENTS
Tnu OF DOCUMENT
179S COVERW=TADDED TO PROV=ADEQUA7£RECORDING SPACE FOR REODiRMG D"p.MA770H
33A AdditW racmdin6 fae ePPlbr1:
10-10-12;04:07PM; # 4/ 14
EXHIBIT"N"
DEED OF TRUST
Recording requested byr
and when recorded mail to;
Community Redevelopment Agency of the City of Palm Springs
3200 Tahquitx Canyon Way
P.O. Box 2743
Palm Springs, Co. 92263
Attention; Executive Director
INSTRUCTIONS TO COUNTY RECORDER;
Index this Instrument as
(1)a Deed of Trust, and
(11) a Fixture Filing
Sparc ebove for Pecowoes Use
DEED OF TRUST AND ASSIGNMENT OF RENTS
This DEED OF TRUST AND ASSIGNMENT OF RENTS ("Deed of Trust") is
entered into between PS Housing Investors, LP,a California Umlted Partnership,whose
principal executive office is at iftw Aj,4 s:.eum n,o� pu, a on c"�u (the
"Trustor"), in favor of va.ts TITLE COMPANY,,,�whose address is
-r e_L1'6i r ",% i 0„-L69" CG oh-sbm (the "Trustee, for the
benefit of the Community.Redevelopment Agency of THE CITY OF PALM SPRINGS
(the "Beneficiary"), with offices at 3200 Tahquit2 Canyon Way, P.O. Box 2743, Palm
Springs, California 9=.
THE TRUSTOR IRREVOCASLy GRANTS, TRANSFER$ AND ASSIGNS TO
THE TRUSTEE, in trust, with the power cf.sale, the real property in the City of Palm
Springs,Riverside County, Caliitomia, more particularly described in Exhibit A atteched
hereto and made part hereof by reference(the-Property"), together with:
0) Ali including without Iknitatio tenements, �
Oil easements and ir dghts appurtenances
used n connection therewith or as
a means of access thereto, an fight, title and interest of the Trustor, now owned or
hereelter acquired, in any land lying within the right-ofAM of any�street, open or
Proposed, adjoining the Property, and any and an sidewalks, allays, strips and other
areas of land adjacent to or used in connection with the Property;
(ii) All oll and gas or other mineral rights in or pertaining to the Property and
all royalty, leasehold and other rights of the Trustor pertaining thereto;
i
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l0-IU-11;U4:0/F'M; # 5/ 14
(III) A I water rights pertaining to:the Property and shares of stock evidencing J
the same, and all deposits made with or other security given to utility companies by the j
Trustor with res
pect ct to the Property; I Pe I
iv The rents issues an
d nd profits thereof, subject, however, to the right, power
and authority of Trustor to collect and apply such rents, issues and profits and set forth
in this Deed of Trust;
(v) All buildings and Improvements of every kind and description now or
hereafter erected or placed on the Property, and all fixtures thereon, Including, but not
limited to, all gas and electric fixtures, engines and machinery, radiators, heaters,
furnaces, heating equipment, laundry equipment, steam and hot water boilers, stoves,
ranges,elevators and motors, bath tubs, sinks,water closets, basins, pipes,faucets and
other plumbing and heating fixtures, mantels, cabinets, refrigeration plant and
refrigerators, whether mechanical or otherwise, cooking apparatus and appurtenances,
and all shades, awnings, screens, blinds and other furnishings, R being hereby agreed
that all such fixtures and furnishings shop to the extent permitted by law be deemed
permanently affixed to and a part of the realty;
(VI) Al building materials and equipment now or hereafter delivered to the 1
Property and intended to be installed thereon;and
(vn) All articles of personal property owned by the Trustor and now or hereafter
attached to or used In and about the building or buildings now erected or hereafter to-be
erected on.the Property which are necessary to the complete and.00n*rtable use and
occupancy of such building or buildings for the purposes for which th®y were or are.to
be erected, and all other goods, 'chattels and personal property as are ever used or
furnished in operating a. building, or the activities conducted therein, similar to the ones
herein described and referred to, and all renewals or replacements thereof or arUdesin
substitution therefor;whether or not the same are or shall be attached to the building or
buiktings In any manner, subject,,.however, to (and only to) any purchase money
security interests In such personal•property.
Said real property and personal property described above, together with appurtenances, I
are referred to collectively in this Deed-of Trust as the"Collateral."
FOR THE PURPOSE OF SECURING THE FOLLOWING 013UGATIONS:
(a) Payment to the Beneficiary of an indebtedness In the principal amount of
One Million Dollars ($1,000 oo0.00), evidenced by a promissory note,executed by the
Trustor and payable to the order of the Benefldary,bearing the same date as this Deed
of Trust, and any.and all I modificadons, extensions or renewals thereof or substitutions
therefor (the "Note"), and.perfcrmance and satisfaction of each and all iodser obligations
of the Trustor under the Note,
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10-10-12;04:07PM; # 6/ 14
(b) Performance Of every obligation or Trustor in this Deed of Trust, the Note,
the Owner Participation Agreement between Beneficiary :and TruStDr related to the
Property(the 'Participation Agreemenr,)contemplating-the Improvement of the"Project'
(as that term is defined In the Participation Agreement); and
(c) Payment of all sums, if any, and Interest thereon that may hereafter be
loaned or advanced by the Beneficiary to or for the benefit of the Trustor or to Its
successors,transferees and assigns, made to the Trustor while the Trustor is the owner
of record• of fee tide to the Property, or any portion thereof, or to the successors,
transferees.or asslgnsiof the Trustor while they are the owners of record of such fee
title, and evideiiced by One Or MOM notes or written-Instruments which recite that they
are secured by this Deed of Trust.
TO PROTECT THE SECURITY OF THIS DEED OF TRUST,;THE TRUSTOR
COVENANTS AND AGREES AS POLLOIWS:
1. The Trustor shall not use.or permit the use of any of the Collateral for any
purpose other than the use for which it was intended at the time Ihis Deed of Trust was
executed, as provided in the Participation Agreement
2. Upon, default under this Deed of Trust or the Note (following delivery of
notice and expiration of the cure period, If any, provided therein), the Beneficiary, at its
Option, may, declare, the whole of.the obligations and sums secured hereby to be
immediately.rlUe and payable.
3. The,person(s)or entity(jes)who have executed this.Deed of Trust are fully
authorized,and have obtained any and all written authorizations, approvals or consents
necessary, to bind the Truster to this Deed of Trust
4, All rents, profits and Income from the Collateral covered by this Dead of
Trust are hereby assigned to. the Beneficiary for the purpose of discharging the
obligations hereby secured. ,However, the Trustor shall be permitted, so long as no
default exists hereunder or under the Note, to collect such rents, profits and income for
use oonsistent with the provisions of the Agreement. j
6. Upon default hereunder or under the Note(following delivery of notice and
expiration of the cure period; H any;, provided .herein or therein). for, the purpose of i
protecting,its interests hereunder, .the t3enefinirfry will be entitled to the appointment by
a crourt haVtng)urisdlction, without ftirttier notice and without regard m adequacy of any
security'for the indebtedness secured hereby, of a receiver fo take possesslon of and
protect the Coflalerat described herein and operate.same and collect the rents, profits
and income therefrom- The entering upon and taking possession of!the Property or
other COUaterai by suds receiver, the erection.of such rents, Profits and income and
the application thereof shall not cure or waive,any default,or'notice of default hereunder I
or invalidate any act done pursuant.to such notice.
•67-
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6, The Trustor, at Its sole cost and expense, shall provide and maintain on
the entire Property, including all buildings and Improvements thereon: (1) a policy of
broad-form bullder s risk insurance sufficient to cover 100 percent of the replacement
value of all buildings and Improvements on the Property including; without limitation,
labor and materials, in place or to be:used as part of the permanent construction
(including, without limitadon, surplus miscellaneous materials and supplies incidental to
the-work, and -scaffolding, staging; towers, forms and equipment not owned or rented
by the,Beneficiary, the cost of which is not induded:in the cost of work); insuring,against
loss or damage by fire, extended:coverage perils and,such other haza(ds,.casualties.or
other contingencies as from time to time may be•reasonabiy,requited.by the Beneficiary;
(0) a popsy of commercial general liability insurance that includes contractual, products
and completed operations coverages,. bodily Injury and; property .damage liability
insurance,with,,combined single limits of not less than $1,000,000 per;occurrence; and
(40 such other insurance as may be reasonably required by the Beneficiary,,in each
case in such amounts, In suoh.manner.arid with such companies as the Beneficiary and
Trustor may reasonably approve. The foregoing minimum insurance coverage limits
shall be subject to reasonable adjustment from time to time by the Beneficiary. Each
such policy shall be endorsed with a ndsrd mortgage clause with loss payable to the
Beneficiary and the Trustor, and shqN provide that the policy shad not be canceled or
materially changed without at least t1firty(30)days'prior notice to the Beneficiary, Upon
request by the Beneficiary, the Trus,tor Immediately shall deposit with the Beneficiary
certificates evidencing such policies.
7. The Trustor shall pay: (1) at least ten days before delinquency, all taxes
and assessments affecting the Collateral, including assessments on appurtenant water
stock; (ii) when due, all en�rbranose, charges and lima, with interest; on the
Collateral or-any part thereof appear to be prior or superior hereto; and (m) all
costs, fees and expenses of the Truste& er the Beneficiary reasonably incurred In
connection with the trusts created under this Deed of Trust.
8. The Trustor shall (i) keep the Collateral in ggod condition and repair and
not remove or demolish any buildings on the Properly to the extbnt insurance or
condemnation proceeds are available; (11)complete or restore promptlland In good and
workmBnft manner the buildings and improvements and any, other building or
improvement wfrlch"may be cons&uotsd, damaged or destroyed thereon: (lit) pay when
due all Balms for labor performed and materials furnished :therefore; (N) comply in all
material respects with all laws affecting the Collateral or requiring any alterations or
improvements to be made thereon; (v) not commit or permit waste of or on the
Collateral; and (vi) not commlt, suffer'or permit any act upon the Property In violation of
law and/or any covenants,condlilone?or restrictions affecting:the Collateral.
9. The Trustor shall, appear in and defend any action or proceeding
purporting to affect the security hereof or the rights or powers of the E9oneficiary or the
Trustee, and shad pay all costs and expenses, Including cost of evidence of title and
reasonable attorneys,fees, in any such action or proceeding in which the Beneficiary or
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I ,
1U-1U-12;04:UR'M; # B/ 14
the Trustee may appear, or In any suit brought by the Beneficiary to foreclose this Deed
Of Trust.
10, Should the Trustor fail to make any payment, or do any act as herein
provided, then the Beneficiary.or-the Trustee,without obligation to do so, and following
notice to .or demand on the Truster, and without releasing the Trustor from any
obligation hereof. (i) may make or do;the same in such manner and to such extent as
either may deem necessary to protect the security hereof, the-Beneficiary or the Trustee
being authorized to enter on the Property for such purposes; (ii) may commence,
appear in and/or defend any action or proceeding purporting to affect the security hereof
or the rights or powers of the Beneficiary or the Trustee;(iii)Imay pay, purchase;contest
or compromise any encumbrance, charge or lien which! In the judgment of either
appears to.be:prior or superior hereto (except for the deeds.of trust, encumbrances and
liens sectiong,the Construction/Permanent Financing Loan(s)and the Agency Loan, as
such terms are defined below); and (Iv) in. exercising any such powers, may pay
necessary expenses, employ iegal counsel and pay such!oounsers ;reasonable fees.
All such amounts paid by the Beneficlary or the Trustee hereunder shall be added to the
obligations secured by this Deed of Trust.
The term `Construction/Permanent Financing Loan" means,; collectively, the {
construction financing and take-out financing, and any refinancing or replacement of 11
that financing from time to 6me; to be provided by a commercial dr other lender(s); j
provided, however, that (i) before entering into any Construction/Permanent Financing i
Loan, the. Trustor shah give:the Beneficiary notice of the Con striction/Pemranent
Financing Loan .and copies; of the loan agreement and all other: documents
evidencing-the Construdion/Perrnansnf Firiandhg Loan; 01) the,funds disbursed from
each donstrucHoroermanerrt Financing.Loan shaft be used only for costs and charges
associated with the loan and for the operation,maintenance and/or improvement of the
Project or the Property as. provided in the Agreement or to refinance existing
Indebtedness;.(HQ the interest on each Conti Ion/Permanent Financing Loan shall be
at a * ohWe.rats based.on.all the.facts•anti dreumstax ces; and .(iv) the combined
amounts of•aU"COns'10110ri/Permanent Financing Lbans or any re-finandng thereof and
the Note secured by this Deed.ofTiust shall not ekgegd one Hundred percent(100%)of
Ow fair market value of the Property as improved by the Project under the Agreement
(such value to be determined by a qualified appraiser reasonably acceptable to Truster ,
end Beneficiary).
11. The .Beneficiary shall have the right, but not the obligation, to pay when
due fire'or other Insurance premlums,required hereunder;If the Trustor falls to make
such payments. All such amounts.paid by the Beneficiary hereunder shall be added to
the obligations secured by this Deed of Trost
12. The Truster shall pay Immediately upon demand all sums so expended by
the Bensficlary or the Trustee under this Deed of Trust,'with Interest from date of
expenditure at the legal rate.
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13. If the Trustor fails to pay any amount required by the Note or this Deed of
Trust when due and payable, or•fails to perform all other covenants, conditions and
agreements of the Note, this Deed of Trust or the Participation Agreement (following
delivery of notice;and expiration of the cure period, if any, provided.thgreln), the amount
of the. Kota, including unpaid.principal and late charges,;and all other charges and
amounts required by the Note and•this Deed of Trust shall, at the option of the
Benefice y, become Immediately, due rand This shaH.ba in addition to and
without limitation on any other remedy-or right available ito the Beneficiary for such
failure.
14, The Trustor shall not voluntarily create or permit to be created against the '
Collateral any lion or liens except as.speoific:aally permitted by this Deed of Trust,or
otherwise authorized by the 'Benafrclary. ;The Trustor, shall_ keep and maintain the
Collatereljfree:from-the.datms.of WI:persons,supplying labor orntiater<alswho-wNl:ento
into the, ionstruction, rehabilltation, repovatlon..o repair of any and ell' buildings or
Improvemenfs now existing or to be erected ion'the Property.
15. By acoepting payment of any sum secured by this Deed of Trust after its
due data or by socepting partial payment of any such sum, the Beneficiary does not
waive its right either to require prompt payment when due of all other;sums so secured
or to declare defeult•for the Trustor's failure to pay.
18. If the Trustor, without the ,prior written consent of the Beneficiary: (1)
agrees to or actually sells,,,convey$,..Wnsfeis.or..disposes of.the;'irotleteral Or any
interest d�eiein':or,portion;fhereof,:•or:;(u):assigns or delegates arty right or obligation
under the Agreement; the Noteor:this Deed of Trust,.then�Wl amounts secured by this
Dead' of Trust.:may be. declared 'immediately,.•due.and payable, at;the..option of,the
8i;nefiaary":,,'T1ie.'Benacisry;ibi not�unreas,'onably wiprhoid:ltc C nt to any such
tiansacElon. 7he'Be'neflclerys' oonsent fo on'e bwisaotfon. of lids shell not be a
waiver of the right lo'*t ire.00nsent to future or successlye transadiona.
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17. As further security for the full and complete performance of each and
every bblOMon,covenant;:agreement and-duty of the Trustor oontaindd herein Orin the
Note,�Tnisto�hereby grants and•oor*s..to'the Beneticiarya secuyRy interest in and
lien on tall of`ithd Collateral. Ttiis.Deed,ofTrust shall sanre'es a security agreement and
flrrareing'.sta#ement created 'puisuant.to ft-califomle, Commandal Code, and the
89n"Ciary,:41. Crave.and may.exercise atl rights, remedies and pomrs of•a secured
party under the California Commercial Code. Further,.thi Deed,of 7'nust is.filed as:a
falure filing pursuanf'to the Callfomia CGofferwroW Code and other applicable law, and
coveis goods whfoh are or'are'to beccrria flxtures.
18. 8houKthe Property,the buildings or improvements thereon,or any part or
any of -them be taken Or damaged by reason of any public ymprovement or
condemnation proceeding, or damaged by fire.or earthquake or in ariy..other manner,
the Beneficiarywill'be entitled,, euNect to the rights of the holder of aOy:serlor deed of
trust securing-a Construotion/Perrnanent Financing Loan; to all of the,Trustore interest
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in compensation, awards and other payments or relief therefor, and, following the
oocurrence.of•a•default as.defined.in the,Note, the Beneficiary shall Ce entMed,jointly
with the Tnrstor, at'the Beheticiarys option, tG commence :appeal to and prosecute in
its.own:name;-any acction or preceding;,,dr:.So•;make.any.compmmise or seWement,:in
connection with:such. taking or'damage, All such cnmponsstion, ewards, damages,
rights•of-adion and proceeds, including the proceeds.'of.any fire and, other Insurance
affedting-the..Property or the.bWldi**orimprovaments thereon,.are.hereby assigned-to
the BeneWr ry,;snbjeot to•the rights:ofti e,holder of;apy;senlor deed of trust•securing.a
ConslrucN64l r ianerd Finsncfng .6an.. After, deducting;therefrom 'all its expenses,
including reasonable attorneys' fees, and K there has not oocurred a default under the
Note, the Be*ciary.. ;shalt:apply,all such.prooeeds.to;tesmring. the Property or the
bWldings.or,imli menmthersorn, or-if;t ro'bas beensuchdefautls or if the.Trustor
deter`mines:not:to,.rebuild; tire-Benrficiery4hall retain:•.the proceeds to' extent of the
amount due.r under the;Note. and'any amounts due,under. this Dealt of:Trust. Any
balance cf•.such.proceeds s4iN'rentaining;shal6•be disbursed by•:ttia Seneficlar to the
Tiustor.
19. if the Trustor falls to perform any covenant or agreement in this Deed,of
Trust Of the 'ParWpatien Agreement, or if a default occurs under the- Note, the
Beneflclary may declare all obagakons,•and sums:secured,hereby immediately due and
payable bydeiivery to,the Trustsb of;written_dederetion._o(defaWt•ar�idemand for sale
and written ngtice.of default'and'of eteetign`•to cause.tile.Collateral to.be SAW, which
notice the Tnistee stteli ceuae.to.be..OWY`W,, for• record;,and the;Beneficlary prey
foreclose thi8';peed of Trust;..proylded,.'however:that.,the�Tnistorshah not bedeern 40
be lri: clefaUlt`Hereunder lot:�ai�ure:;to..;tXiake•'a9ilY pajimenf wharf dui'or:-for•:failure]to
perforni,any!other'covenanf'or agr+�e►neiit:bontalned harem`until if'iRy (30) days after
written notice of.such failure is given,2o:the,Trustor and Trustor:is:affor'ed areasonable
opportunity to.cure the'de&a It"1'he'Berieffc7ary shall,also Qeposit with the,Trustee th
Deed of'TriK the Note and all'other doaiments evidencing :the obagations or surps
secured hereby:
20. After the lapse of.such Ems as may then be required b 4aw followin the
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recordation of the noffca of:defaulk and.nofe of ,sale having been iven as then
• ng
required by law,the.Trastee,.without:demarid on the Trustor,shell,sep,the Prcpefty at
the the'arid.iilace-e'did.,by{the,.ThMoe,jn the.notice;of�sale,,-eitber: s,a-Whole=or'-in
separate•parcels;and in sucKbrder as it;may,daterminer,at publiciauetlon:to the highest
bidder for cast► in lawful monoy.of.the United Statea, payable at time of sale. The
Trustee.MaY.postpone sale.of all.or any pgRion of the;Prop iy by,pubib announcement
at>he time arid:place of salerend from•tiree'fo;dme thereafter may furtirer postpone the
eels by,putilie;announcement'of the:time`.•flited:by'the piecet ing postponement. The
Trustee.shall ifeliver.to tile•:purchases;lt§.,teed 'conveyingfte title• to:the.Property or
poitiort thereq so sold, but:withbut anY,'cobsnant or warra*%expressjor:lmplied. The
recitals;in'the.'Trusteels deed of any'ma-ftm or facts shah be> ive condus proof of the
truth'fulness`ih`ereof. Any person,ineludirg•the,-Trustor,.the.trustee and the Ssneficiary,
MMY pufeha_se.af.the sale.. The Trustee'Aslf.spply the procasd6 of the;sale;.to payment
of {n tfieekparrsea of"the.sare, togetiiei"with-the resspnable.expet►ses'of:tne trust
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created,by this.peed of Trust, including reasonable Trustee's fees.and attorneys' fees
for conducting the sale,and the actual.cost of publishing,.recording, mailing;and posting
notice of the sale; (H) the cost of any search and/or other evidence of.We procedure in
connection with-the sale and of revenue stamps on the Trustee's deed; Oil) all sums
expended under the terms hereof not then repald,with accrued interest at the legal rate;
(iv) all other,sums then secured hereby; and (v) the remainder, if any,;to the person or
persons legally entilled.theretc.
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21. The Beneficiary may from time to time substitute .g successor or
successors to the Trustee named herein or.acting hereunder to execute the trusts under
this Dead-of Trust. Upon such.appoinorlor4 and,without oonveyance,to the successor
trustee, the latter shall be-vested with all.,tide,,powers and. duties conferred upon a6y
Trustee herein named or acting hereunder. Eaoh such appointment:and substitution
shall be made.by written instrument executed by the Beneficiary:, containing reference
to this Deed.of Trust and its-place.ofxeoord, Which instrument, when duly recorded In
Rlvdmide County, California; shall be conclusive proof of proper appointment of the
successor trustee.
22. Upon written request of the Beneficiary stating that an obligations secured
hereby have been satisfied and all. sums secured hereby have been paid, and upon
surrender of this Deed of Trust and the Note to the Trustee for 'cancellation and
retention, and'upon payment of its flees, the Trustes snap recorivey, without warranty, i
the Collateral"ttien held hereunder. The recitals in such reconveyance of any matters or
facts shall be conclusive proof of the truthfulness thereof. The:.grantee in such f
reconveyanoe may be described as"the person or persons legally entitled thereto"
23. The trusts created by this Deed of Trust are Irrevocable by the Tnrstor.
24. This Deed of Trust applies to, inures to the benefit of, and binds of the
Tnustor, the Beneficiary and the Trustee and their respective administrators, executors,
officers, directors, transferees; successors and assigns. The term "Beneficiary shall
Include not only the original Beneficiary hereunder taut also any future o"wrter and holder,
including *dges. of.the Note seoure'd.�eroby. In 'this Deed of Trust, whenever the
co►>textsc requires, the masculina.gender includes-the feminine sndlor neuter, and the
singulath udes.theplural.
25. In addition to and without limitation on any other rights on remedies of the
Trustee or the Beneficiary, if the Tiustee'or.the Beneficiary commences any legal action
or proceeding to enforce or Interpret:any provision of this Deed of Trust or the Note,the
Trustor shall pay all costs and expenses Incurred by the Trustee or the Beneficiary in
connection with such action or proceeding, including legal expenses-and reasonable
attorneys'fees and court costs.
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26, The Trustee accepts the trusts hereunder when this Deed of Trust, duly
executed and acknowledged, is made public record as provided bylaw. Except as
otherwise provided by law, the Trustee is not obligated to notify any party hereto of i
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pending sale under this Deed, of Trust or of any fiction or proceeding. In which the
Trustor, the Beneficiary or the Trustee Is a party, unless brought by the!Trustee.
27. The Trustor-requests that a copy of any notice of default and of any notice of sale
hereunder be mailed to it at 2010 Main St Suite 1250, Irvine, Ca. 92614.
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28. The Trustor shall cause a copy of each deed of trust securing . a i
Construction/ Permanent Financing Loan to be provided to.the Beneficiary immediately
upon its recordation, so that the Beneficiary may prepare and record a request for j
notice of default and notice of sale thereunder pursuant to California MY Code Section i
2924b.
29. PROVIDED THAT NO NOTICE OF DEFAULT HEREUNDER THEM
APPEARS OF RECORD AND SUW90T.TO THE CONDITIONS IN SECTION 10
ABOVE AND/OR IN THE,.PARTICIPATJON AGREEMENT; THIS DEED OF TRUST
SHALL BE.SUBORDINATEAND SUBJECT TO ANY DEED OR DEEDS OF TRUST
SECURING A -CONSTRUCTION/PERMANENT FINANCING, LOAN. TRUSTOR
SHALL, `UPON' REQUEST OF•BENERCIARY,,EXECUTE..SUCH S,lll ORDINATION
AGREEMENT OR OTHER DOCU1Mb4ATit7N .REASONABLY .NECESSARY TO
SUBdikaMATE THE LIEN'AND.CHARGE OF THIS DEED OF,TRUST TO,LIEN OF
ANY,DEED OR..DEEDS',OF TRUST SECURING A CONSTRUCTIONIPERMANENT
FINANCINGLOAN.
30. This Deed of Trust shaq be interpreted and enforced, and the rights and
duties (both.procedural•and substantive) of the parties hereunder shall be determined,
Scoording•to-California law,
31. Capitalized terms not otherwise defined herein shall have the meanings
given them in the Agreement or the Note.
IN WITNESS WHEREOF, Trustor has executed this Deed of Tr4,st as of the date
set forth above.
TR
pweeevJ MiA►.1 , Pees,cEK.ri ep
dtoQ,gV Pae4wv®q, ;p�,.V�c:CawA�,1T, i4>L.
' faaNsera� Poc-t�.++ec. op
PS +ipytd,,]CS
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ACKNOWLEDGMENTS
STATE OF CALIFORNIA )
COUNTY OF�..
I
On ZYuLN 15 201s, before me,
Notary Public, .personally appeared
who pwgq to me on the
basis of satisfactory•evidenoe to be the personA whose named Dare subscribed to
the within Instrument and adcnowIedged to me•that shelthey.executed the same:;in
Mhodtheir authorized capaciWeg, and that by a their sighaturels)' on the
Instrument the .perscn.W, or the entity upon behalf of which the 1personjo acted,
executed the Instrument.
I certify under PENALTY OF PERJURY under the laws of the State of CaRomia that the
foregoing paragraph is true and correet.
WITNESS my hand and official seal.
"V ELDVAYEN
commlsalon N 1905051
NauOm Esolepaw •Osa*011
27.2
Owe county
I i Caorn.Ex ilea Se 27.2011+ ;
(SEAL,)
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EXHIBIT A TO DEED OF TRUST
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LEGAL DESCRIPTION !1
All that certain real property situated In the City of Palm Springs, County' I
of Riverside, State
of California, described as follows:
Parcel A:
Lots 33 and 34 of Palm Springs Estates No.3,in the City of Pakn Sp" Count or Riveralde,
State.af CMNQMa,es per mep recorded in600k 17,Page 34,of Maps,In the OW4 of the County
Ruaderof said County.
EMW ft East 4.5o test.
Also.EVCW the d9ht to any dePosR of.Ck gas or other hydrocarbon s,bstaM.m uMefl ft saki
W'nd,'as reserved by CaVomla Trust Corrpiany,a;Corporatlon,in dead recorded Rtabnwy 28, 1929
In 868k 401,Page 81:ef Death-iubord's cf Rtvarside,Covnty,Caiftrr 18.
Parcel 8:
Late 3S and 36 of Patin Sprino Elbow N0.3,In the City.of Palm springs,Caunlit of aM"Mer
Sts11E Of California,as per map recorded in BaOk 17, Page 34,of maps,III the t]Nke dthe County
Recorder of'sald County.
600ep8rr9 tnsr ftM that PMW Conveyed tp teas My of Palm Stings by Dasd recorded April 22,
19597n 9ook�25s,:?ege 491.OfOfttdel•ReCarrdy Ice Nfemta. i
Alm excapdn9 e m e4pit to any depoak of oil,gas era wr hladloorbon subaalfoes undertying said
teWas nwMoed by Cs ftft.Tmst CaenPent!r;a.Qerpeeeeinnr In&46 recorded. 29,.193216
EQok 70,Page 39a'o fOfOdal RaoordcafJRW�tskle'Cou.Ry,QWernio,.as to;said lot 1,;erd.naeonded
FebrueW'28; 19297n Soak 302,:Pape 4 of Oeed.k!aoords of Rlvuslde County.Ca1HOnMa.as to saki
Lots 35'aiid 26, f
Parw C:
Lot 32•of Palm Springs Estates No..3,to the(Ay of Palm SpdrgM County of RBraMUW Sb to of
Ch"wMa,as per map recorded In nook 17.,Page 34,of Made,In did Office of the County Recorder
of said County,
6=Ptihe t%htto any deposit of oil,gas or other hydroarbon substsnxs undes9ytnosold Wad,as
rCM%q d by Caffromla.7 rust Company.in deed mcorded FObruary 29, 1920 In d0ak 798,Pape 465
of Deeds,rawds of Riverside County,catfomta.
Assessor's Pprcel Nos. 505-1a4-01.9,.020, 027
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DOC # 2011-0377011
08/25/2011 10:47A Fee-NC
Page I of 11
Recorded in Official Records
County of Riverside
arr W. Ward
Assessor,DCounty Clerk & Recorder
Recording
and wenrecorded mall to: IIIIIIIIIIIIIIIIIIIIIIIIIIIII IIIII IIIII III IIIII IIII IIII
Community Redevelopment Agency of the City of Palm Springs
3200 Tahquitz Canyon Way
P.O. Box 2743
Palm Springs, Ca. 92263
Attention: Executive Director
INSTRUCTIONS TO COUNTY RECORDER: s R U PAGE SIZE I DA I MSc I LONG RFD COPY
Index this instrument as
(i) a Deed of Trust, and
EXAM
II a Fixture Filing A L 465 426 PCOR NCOR SMF CH //ff
T: CTY UNI (/6j
�}tS13�i
DEED OF TRUST AND ASSIGNMENT OF RENTS ACCOMODATION
This DEED OF TRUST AND ASSIGNMENT OF RENTS ("Deed of Trust") is entered
into between PS Housing Investors, LP, a California Limited Partnership, whose
principal executive office is at 2010 Main St. Suite 1250, Irvine, Ca. 92614 (the `
"Trustor"), in favor of LAWYERS TITLE COMPANY, whose address is 7530 N.
Glenoaks Boulevard, Burbank, CA 91504 (the `Trustee"), for the benefit of the
Community Redevelopment Agency of THE CITY OF PALM SPRINGS (the
"Beneficiary"), with offices at 3200 Tahquitz Canyon Way, P.O. Box 2743, Palm
Springs, California 92263.
THE TRUSTOR IRREVOCABLY GRANTS, TRANSFERS AND ASSIGNS TO
THE TRUSTEE, in trust, with the power of sale, the real property in the City of Palm
Springs, Riverside County, California, more particularly described in Exhibit A attached
hereto and made part hereof by reference (the 'Property"), together with:
(i) All tenements, hereditaments and appurtenances of or to the Property,
including without limitation all easements and rights used in connection therewith or as
a means of access thereto, all right, title and interest of the Trustor, now owned or
hereafter acquired, in any land lying within the right-of-way of any street, open or
proposed, adjoining the Property, and any and all sidewalks, alleys, strips and other
areas of land adjacent to or used in connection with the Property;
(ii) All oil and gas or other mineral rights in or pertaining to the Property and
all royalty, leasehold and other rights of the Trustor pertaining thereto;
(iii) All water rights pertaining to the Property and shares of stock evidencing
the same, and all deposits made with or other security given to utility companies by the
Trustor with respect to the Property;
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(iv) The rents, issues and profits thereof, subject, however, to the right, power
and authority of Trustor to collect and apply such rents, issues and profits and set forth
in this Deed of Trust;
(v) All buildings and improvements of every kind and description now or
hereafter erected or placed on the Property, and all fixtures thereon, including, but not
limited to, all gas and electric fixtures, engines and machinery, radiators, heaters,
furnaces, heating equipment, laundry equipment, steam and hot water boilers, stoves,
ranges, elevators and motors, bath tubs, sinks, water closets, basins, pipes, faucets and
other plumbing and heating fixtures, mantels, cabinets, refrigeration plant and
refrigerators, whether mechanical or otherwise, cooking apparatus and appurtenances,
and all shades, awnings, screens, blinds and other furnishings, it being hereby agreed
that all such fixtures and furnishings shall to the extent permitted by law be deemed
permanently affixed to and a part of the realty;
(vi) All building materials and equipment now or hereafter delivered to the
Property and intended to be installed thereon; and
(vii) All articles of personal property owned by the Trustor and now or hereafter
attached to or used in and about the building or buildings now erected or hereafter to be
erected on the Property which are necessary to the complete and comfortable use and
occupancy of such building or buildings for the purposes for which they were or are to
be erected, and all other goods, chattels and personal property as are ever used or
furnished in operating a building, or the activities conducted therein, similar to the ones
herein described and referred to, and all renewals or replacements thereof or articles in
substitution therefor, whether or not the same are or shall be attached to the building or
buildings in any manner; subject, however, to (and only to) any purchase money
security interests in such personal property.
Said real property and personal property described above, together with appurtenances,
are referred to collectively in this Deed of Trust as the "Collateral."
FOR THE PURPOSE OF SECURING THE FOLLOWING OBLIGATIONS:
(a) Payment to the Beneficiary of an indebtedness in the principal amount of
Five Hundred Thousand Dollars ($500,000.00), evidenced by a promissory note
executed by the Trustor and payable to the order of the Beneficiary, bearing the same
date as this Deed of Trust, and any and all modifications, extensions or renewals
thereof or substitutions therefor (the "Note"), and performance and satisfaction of each
and all other obligations of the Trustor under the Note;
(b) Performance of every obligation or Trustor in this Deed of Trust, the Note,
the Owner Participation Agreement between Beneficiary and Trustor related to the
Property (the "Participation Agreement') contemplating the improvement of the "Project"
(as that term is defined in the Participation Agreement); and
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(c) Payment of all sums, if any, and interest thereon that may hereafter be
loaned or advanced by the Beneficiary to or for the benefit of the Trustor or to its
successors, transferees and assigns, made to the Trustor while the Trustor is the owner
of record of fee title to the Property, or any portion thereof, or to the successors,
transferees or assigns of the Trustor while they are the owners of record of such fee
title, and evidenced by one or more notes or written instruments which recite that they
are secured by this Deed of Trust.
TO PROTECT THE SECURITY OF THIS DEED OF TRUST, THE TRUSTOR
COVENANTS AND AGREES AS FOLLOWS:
1. The Trustor shall not use or permit the use of any of the Collateral for any
purpose other than the use for which it was intended at the time this Deed of Trust was
executed, as provided in the Participation Agreement.
2. Upon default under this Deed of Trust or the Note (following delivery of
notice and expiration of the cure period, if any, provided therein), the Beneficiary, at its
option, may declare the whole of the obligations and sums secured hereby to be
immediately due and payable.
3. The person(s) or entity(ies) who have executed this Deed of Trust are fully
authorized, and have obtained any and all written authorizations, approvals or consents
necessary, to bind the Trustor to this Deed of Trust.
4. All rents, profits and income from the Collateral covered by this Deed of
Trust are hereby assigned to the Beneficiary for the purpose of discharging the
obligations hereby secured. However, the Trustor shall be permitted, so long as no
default exists hereunder or under the Note, to collect such rents, profits and income for
use consistent with the provisions of the Agreement.
5. Upon default hereunder or under the Note (following delivery of notice and
expiration of the cure period, if any, provided herein or therein), for the purpose of
protecting its interests hereunder, the Beneficiary will be entitled to the appointment by
a court having jurisdiction, without further notice and without regard to adequacy of any
security for the indebtedness secured hereby, of a receiver to take possession of and
protect the Collateral described herein and operate same and collect the rents, profits
and income therefrom. The entering upon and taking possession of the Property or
other Collateral by such receiver, the collection of such rents, profits and income and
the application thereof shall not cure or waive any default or notice of default hereunder
or invalidate any act done pursuant to such notice.
6. The Trustor, at its sole cost and expense, shall provide and maintain on
the entire Property, including all buildings and improvements thereon: (i) a policy of
broad-form builder's risk insurance sufficient to cover 100 percent of the replacement
value of all buildings and improvements on the Property including; without limitation,
labor and materials in place or to be used as part of the permanent construction
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(including, without limitation, surplus miscellaneous materials and supplies incidental to
the work, and scaffolding, staging, towers, forms and equipment not owned or rented
by the Beneficiary, the cost of which is not included in the cost of work), insuring against
loss or damage by fire, extended coverage perils and such other hazards, casualties or
other contingencies as from time to time may be reasonably required by the Beneficiary;
(ii) a policy of commercial general liability insurance that includes contractual, products
and completed operations coverages, bodily injury and property damage liability
insurance with combined single limits of not less than $1,000,000 per occurrence; and
(iii) such other insurance as may be reasonably required by the Beneficiary, in each
case in such amounts, in such manner and with such companies as the Beneficiary and
Trustor may reasonably approve. The foregoing minimum insurance coverage limits
shall be subject to reasonable adjustment from time to time by the Beneficiary. Each
such policy shall be endorsed with a standard mortgage clause with loss payable to the
Beneficiary and the Trustor, and shall provide that the policy shall not be canceled or
materially changed without at least thirty (30) days' prior notice to the Beneficiary. Upon
request by the Beneficiary, the Trustor immediately shall deposit with the Beneficiary
certificates evidencing such policies.
7. The Trustor shall pay: (i) at least ten days before delinquency, all taxes
and assessments affecting the Collateral, including assessments on appurtenant water
stock; (ii) when due, all encumbrances, charges and liens, with interest, on the
Collateral or any part thereof which appear to be prior or superior hereto; and (iii) all
costs, fees and expenses of the Trustee or the Beneficiary reasonably incurred in
connection with the trusts created under this Deed of Trust.
8. The Trustor shall: (i) keep the Collateral in good condition and repair and
not remove or demolish any buildings on the Property; to the extent insurance or
condemnation proceeds are available; (ii) complete or restore promptly and in good and
workmanlike manner the buildings and improvements and any other building or
improvement which may be constructed, damaged or destroyed thereon; (iii) pay when
due all claims for labor performed and materials furnished therefore; (iv) comply in all
material respects with all laws affecting the Collateral or requiring any alterations or
improvements to be made thereon; (v) not commit or permit waste of or on the
Collateral; and (vi) not commit, suffer or permit any act upon the Property in violation of
law and/or any covenants, conditions or restrictions affecting the Collateral.
9. The Trustor shall appear in and defend any action or proceeding
purporting to affect the security hereof or the rights or powers of the Beneficiary or the
Trustee, and shall pay all costs and expenses, including cost of evidence of title and
reasonable attorneys' fees, in any such action or proceeding in which the Beneficiary or
the Trustee may appear, or in any suit brought by the Beneficiary to foreclose this Deed
of Trust.
10. Should the Trustor fail to make any payment or do any act as herein
provided, then the Beneficiary or the Trustee, without obligation to do so, and following
notice to or demand on the Trustor, and without releasing the Trustor from any
- 4 -
obligation hereof: (i) may make or do the same in such manner and to such extent as
either may deem necessary to protect the security hereof, the Beneficiary or the Trustee
being authorized to enter on the Property for such purposes; (ii) may commence,
appear in and/or defend any action or proceeding purporting to affect the security hereof
or the rights or powers of the Beneficiary or the Trustee; (iii) may pay, purchase, contest
or compromise any encumbrance, charge or lien which in the judgment of either
appears to be prior or superior hereto (except for the deeds of trust, encumbrances and
liens securing the Construction/Permanent Financing Loan(s) and the Agency Loan, as
such terms are defined below); and (iv) in exercising any such powers, may pay
necessary expenses, employ legal counsel and pay such counsel's reasonable fees.
All such amounts paid by the Beneficiary or the Trustee hereunder shall be added to the
obligations secured by this Deed of Trust.
The term "Construction/Permanent Financing Loan" means, collectively, the
construction financing and take-out financing, and any refinancing or replacement of
that financing from time to time, to be provided by a commercial or other lender(s);
provided, however, that (i) before entering into any Construction/Permanent Financing
Loan, the Trustor shall give the Beneficiary notice of the Construction/Permanent
Financing Loan and copies of the loan agreement and all other loan documents
evidencing the Construction/Permanent Financing Loan; (ii) the funds disbursed from
each Construction/Permanent Financing Loan shall be used only for costs and charges
associated with the loan and for the operation, maintenance and/or improvement of the
Project or the Property as provided in the Agreement or to refinance existing
indebtedness; (iii) the interest on each Construction/Permanent Financing Loan shall be
at a reasonable rate based on all the facts and circumstances; and (iv) the combined
amounts of all Construction/Permanent Financing Loans or any re-financing thereof and
the Note secured by this Deed of Trust shall not exceed one hundred percent (100%) of
the fair market value of the Property as improved by the Project under the Agreement
(such value to be determined by a qualified appraiser reasonably acceptable to Trustor
and Beneficiary).
11. The Beneficiary shall have the right, but not the obligation, to pay when
due fire or other insurance premiums required hereunder if the Trustor fails to make
such payments. All such amounts paid by the Beneficiary hereunder shall be added to
the obligations secured by this Deed of Trust.
12. The Trustor shall pay immediately upon demand all sums so expended by
the Beneficiary or the Trustee under this Deed of Trust, with interest from date of
expenditure at the legal rate.
13. If the Trustor fails to pay any amount required by the Note or this Deed of
Trust when due and payable, or fails to perform all other covenants, conditions and
agreements of the Note, this Deed of Trust or the Participation Agreement (following
delivery of notice and expiration of the cure period, if any, provided therein), the amount
of the Note, including unpaid principal and late charges, and all other charges and
amounts required by the Note and this Deed of Trust shall, at the option of the
- 5 -
Beneficiary, become immediately due and payable. This shall be in addition to and
without limitation on any other remedy or right available to the Beneficiary for such
failure.
14. The Trustor shall not voluntarily create or permit to be created against the
Collateral any lien or liens except as specifically permitted by this Deed of Trust or
otherwise authorized by the Beneficiary. The Trustor shall keep and maintain the
Collateral free from the claims of all persons supplying labor or materials who will enter
into the construction, rehabilitation, renovation or repair of any and all buildings or
improvements now existing or to be erected on the Property.
15. By accepting payment of any sum secured by this Deed of Trust after its
due date or by accepting partial payment of any such sum, the Beneficiary does not
waive its right either to require prompt payment when due of all other sums so secured
or to declare default for the Trustor's failure to pay.
16. If the Trustor, without the prior written consent of the Beneficiary: (i)
agrees to or actually sells, conveys, transfers or disposes of the Collateral or any
interest therein or portion thereof, or (ii) assigns or delegates any right or obligation
under the Agreement, the Note or this Deed of Trust, then all amounts secured by this
Deed of Trust may be declared immediately due and payable, at the option of the
Beneficiary. The Beneficiary shall not unreasonably withhold its consent to any such
transaction. The Beneficiary's consent to one transaction of this type shall not be a
waiver of the right to require consent to future or successive transactions.
17. As further security for the full and complete performance of each and
every obligation, covenant, agreement and duty of the Trustor contained herein or in the
Note, the Trustor hereby grants and conveys to the Beneficiary a security interest in and
lien on all of the Collateral. This Deed of Trust shall serve as a security agreement and
financing statement created pursuant to the California Commercial Code, and the
Beneficiary will have and may exercise all rights, remedies and powers of a secured
parry under the California Commercial Code. Further, this Deed of Trust is filed as a
fixture filing pursuant to the California Commercial Code and other applicable law, and
covers goods which are or are to become fixtures.
18. Should the Property, the buildings or improvements thereon, or any part of
any of them be taken or damaged by reason of any public improvement or
condemnation proceeding, or damaged by fire or earthquake or in any other manner,
the Beneficiary will be entitled, subject to the rights of the holder of any senior deed of
trust securing a Construction/Permanent Financing Loan, to all of the Trustor's interest
in compensation, awards and other payments or relief therefor; and, following the
occurrence of a default as defined in the Note, the Beneficiary shall be entitled, jointly
with the Trustor, at the Beneficiary's option, to commence, appear in and prosecute in
its own name, any action or proceeding, or to make any compromise or settlement, in
connection with such taking or damage. All such compensation, awards, damages,
rights of action and proceeds, including the proceeds of any fire and other insurance
- 6 -
affecting the Property or the buildings or improvements thereon, are hereby assigned to
the Beneficiary, subject to the rights of the holder of any senior deed of trust securing a
Construction/Permanent Financing Loan. After deducting therefrom all its expenses,
including reasonable attorneys' fees, and if there has not occurred a default under the
Note, the Beneficiary shall apply all such proceeds to restoring the Property or the
buildings or improvements thereon, or if there has been such default, or if the Trustor
determines not to rebuild, the Beneficiary shall retain the proceeds to the extent of the
amount due under the Note and any amounts due under this Deed of Trust. Any
balance of such proceeds still remaining shall be disbursed by the Beneficiary to the
Trustor.
19. If the Trustor fails to perform an covenant or agreement in this Deed of
P Y 9
Trust or the Participation Agreement, or if a default occurs under the Note, the
Beneficiary may declare all obligations and sums secured hereby immediately due and
payable by delivery to the Trustee of written declaration of default and demand for sale
and written notice of default and of election to cause the Collateral to be sold, which
notice the Trustee shall cause to be duly filed for record, and the Beneficiary may
foreclose this Deed of Trust; provided, however that the Trustor shall not be deemed to
be in default hereunder for failure to make any payment when due or for failure to
perform any other covenant or agreement contained herein until thirty (30) days after
written notice of such failure is given to the Trustor and Trustor is afforded a reasonable
opportunity to cure the default. The Beneficiary shall also deposit with the Trustee this
Deed of Trust, the Note and all other documents evidencing the obligations or sums
secured hereby.
20. After the lapse of such time as may then be required by law following the
recordation of the notice of default, and notice of sale having been given as then
required by law, the Trustee, without demand on the Trustor, shall sell the Property at
the time and place fixed by the Trustee in the notice of sale, either as a whole or in
separate parcels, and in such order as it may determine, at public auction to the highest
bidder for cash in lawful money of the United States, payable at time of sale. The
Trustee may postpone sale of all or any portion of the Property by public announcement
at the time and place of sale, and from time to time thereafter may further postpone the
sale by public announcement at the time fixed by the preceding postponement. The
Trustee shall deliver to the purchaser its deed conveying fee title to the Property or
portion thereof so sold, but without any covenant or warranty, express or implied. The
recitals in the Trustee's deed of any matters or facts shall be conclusive proof of the
truthfulness thereof. Any person, including the Trustor, the Trustee and the Beneficiary,
may purchase at the sale. The Trustee shall apply the proceeds of the sale to payment
of: (i) the expenses of the sale, together with the reasonable expenses of the trust
created by this Deed of Trust, including reasonable Trustee's fees and attorneys' fees
for conducting the sale, and the actual cost of publishing, recording, mailing and posting
notice of the sale; (ii) the cost of any search and/or other evidence of title procedure in
connection with the sale and of revenue stamps on the Trustee's deed; (iii) all sums
expended under the terms hereof not then repaid, with accrued interest at the legal rate;
- 7 -
(iv) all other sums then secured hereby; and (v) the remainder, if any, to the person or
persons legally entitled thereto.
21. The Beneficiary may from time to time substitute a successor or
successors to the Trustee named herein or acting hereunder to execute the trusts under
this Deed of Trust. Upon such appointment, and without conveyance to the successor
trustee, the latter shall be vested with all title, powers and duties conferred upon any
Trustee herein named or acting hereunder. Each such appointment and substitution
shall be made by written instrument executed by the Beneficiary, containing reference
to this Deed of Trust and its place of record, which instrument, when duly recorded in
Riverside County, California, shall be conclusive proof of proper appointment of the
successor trustee.
22. Upon written request of the Beneficiary stating that all obligations secured
hereby have been satisfied and all sums secured hereby have been paid, and upon
surrender of this Deed of Trust and the Note to the Trustee for cancellation and
retention, and upon payment of its fees, the Trustee shall reconvey, without warranty,
the Collateral then held hereunder. The recitals in such reconveyance of any matters or
facts shall be conclusive proof of the truthfulness thereof. The grantee in such
reconveyance may be described as "the person or persons legally entitled thereto."
23. The trusts created by this Deed of Trust are irrevocable by the Trustor.
24. This Deed of Trust applies to, inures to the benefit of, and binds of the
Trustor, the Beneficiary and the Trustee and their respective administrators, executors,
officers, directors, transferees, successors and assigns. The term "Beneficiary" shall
include not only the original Beneficiary hereunder but also any future owner and holder,
including pledges, of the Note secured hereby. In this Deed of Trust, whenever the
context so requires, the masculine gender includes the feminine and/or neuter, and the
singular includes the plural.
25. In addition to and without limitation on any other rights or remedies of the
Trustee or the Beneficiary, if the Trustee or the Beneficiary commences any legal action
or proceeding to enforce or interpret any provision of this Deed of Trust or the Note, the
Trustor shall pay all costs and expenses incurred by the Trustee or the Beneficiary in
connection with such action or proceeding, including legal expenses and reasonable
attorneys' fees and court costs.
26. The Trustee accepts the trusts hereunder when this Deed of Trust, duly
executed and acknowledged, is made public record as provided by law. Except as
otherwise provided by law, the Trustee is not obligated to notify any party hereto of
pending sale under this Deed of Trust or of any action or proceeding in which the
Trustor, the Beneficiary or the Trustee is a party, unless brought by the Trustee.
27. The Trustor requests that a copy of any notice of default and of any notice of sale
hereunder be mailed to it at 2010 Main St. Suite 1250, Irvine, Ca. 92614.
- 8 -
28. The Trustor shall cause a copy of each deed of trust securing a
Construction/ Permanent Financing Loan to be provided to the Beneficiary immediately
upon its recordation, so that the Beneficiary may prepare and record a request for
notice of default and notice of sale thereunder pursuant to California Civil Code Section
2924b.
29. PROVIDED THAT NO NOTICE OF DEFAULT HEREUNDER THEN
APPEARS OF RECORD AND SUBJECT TO THE CONDITIONS IN SECTION 10
ABOVE AND/OR IN THE PARTICIPATION AGREEMENT, THIS DEED OF TRUST
SHALL BE SUBORDINATE AND SUBJECT TO ANY DEED OR DEEDS OF TRUST
SECURING A CONSTRUCTION/PERMANENT FINANCING LOAN. TRUSTOR
SHALL, UPON REQUEST OF BENEFICIARY, EXECUTE SUCH SUBORDINATION
AGREEMENT OR OTHER DOCUMENTATION REASONABLY NECESSARY TO
SUBORIDINATE THE LIEN AND CHARGE OF THIS DEED OF TRUST TO LIEN OF
ANY DEED OR DEEDS OF TRUST SECURING A CONSTRUCTION/PERMANENT
FINANCING LOAN.
30. This Deed of Trust shall be interpreted and enforced, and the rights and
duties (both procedural and substantive) of the parties hereunder shall be determined,
according to California law.
31. Capitalized terms not otherwise defined herein shall have the meanings
given them in the Agreement or the Note.
IN WITNESS WHEREOF, Trustor has executed this Deed of Trust as of the date
set forth above. /
TRUSTOR.
rZu/ f (gnnu
PS 14oU5,41 Inveslor5 IP , G
co blow„-p
- 9 -
ACKNOWLEDGMENTS
STATE OF CALIFORNIA )
OaArJC-E ) ss.
COUNTYOFRroERSIBE" )
On nui:,�T 9 , 0or1 , 2011, before me,
fni�p' F.tNvA�r a" Notary Public, personally appeared
oN�n Hn,rJtia , who proved to me on the
basis of satisfactory evidence to be the person(arywhose nameW Is re subscribed to
the within instrument and acknowledged to me that she/they executed the same in
GYher/their authorized capacity(ies-y and that by ®/her/their signatureW on the
instrument the personal, or the entity upon behalf of which the personK acted,
executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
GINA ELDUAYEN
Commission # 1905851
Notary Public-California
Orange County
M comm.Expires se 27,2014
(SEAL)
- 10 -
EXHIBIT A TO DEED OF TRUST
LEGAL DESCRIPTION
All that certain real property situated in the City of Palm Springs, County of Riverside,
State of California, described as follows:
Parcel A:
Lots 33 and 34 of Palm Springs Estates No. 3, in the City of Palm Springs, County of Riverside,
State of California, as per map recorded In Book 17, Page 34, of Maps, in the Office of the County
Recorder of said County.
Except the East 4.50 feet.
Also Except the right to any deposit of oil, gas or other hydrocarbon substances underlying said
land,as reserved by California Trust Company, a Corporation, in deed recorded February 28, 1929
in Book 801, Page 81 of Deeds, records of Riverside County, California.
Parcel 8:
Lots 35 and 36 of Palm Springs Estates No. 3, in the City of Palm Springs, County of Riverside,
State of California, as per map recorded in Book 17, Page 34, of Maps, in the Office of the County
Recorder of said County.
Excepting therefrom that portion conveyed to the City of Palm Springs by Deed recorded April 22,
1953 in Book 2258, Page 431 of Official Records of Riverside County, California.
Also Excepting the right to any deposit of oil, gas or other hydrocarbon substances underlying said
land, as reserved by California Trust Company, a Corporation,in deeds recorded March 29, 1932 in
Book 70, Page 394 of Official Records of Riverside County, California, as to said Lot 1, and recorded
February 28, 1929 In Book 302, Page 4 of Deeds, records of Riverside County, California, as to said
Lots 3S and 36.
Parcel C:
Lot 32 of Palm Springs Estates No. 3, in the City of Palm Springs, County of Riverside,State of
California,as per map recorded in Book 17, Page 34,of Maps, in the Office of the County Recorder
of said County.
Except the right to any deposit of oil, gas or other hydrocarbon substances underlying said land,as
reserved by California Tnst Company, in deed recorded February 19, 1929 in Book 798, Page 465
of Deeds, records of Riverside County, California.
Assessor's Parcel Nos. 505-184-019, 020, 027
11
DOC # 2011 -0377012
08/25/2011 10:47A Fee:NC
Page 1 of 10
Recorded in Official Records
County of Riverside
Larry W. Ward
FREE RECORDING REQUESTED BY Illlssll IIIIIIIIICounty
IIIIClerk
II II RIIIII III it
AND WHEN RECORDED MAIL TO:
COMMUNITY REDEVELOPMENT AGENCY
OF THE CITY OF PALM SPRINGS
3200 Tahquitz Canyon Way, P.O. Box 2743
Palm Springs, CA 92263 S R U PAGE I SIZE DA I MISC I LONG I RFD COPY
Attn: 33Exx2ecutive Director /
ACAU]I.I1t21D M A L 1 465 426 FPCCRNCiDR SMF VGH� EXAM it
This document delivered to Record - T: CTY UNI
as an accommodation only at the
express s not st ofbeen theminecs hereto. REGULATORY AGREEMENT AND
it has not been examined as to /y
it's effect of validity. DECLARATION OF COVENANTS AND RESTRICTIONS
THIS REGULATORY AGREEMENT AND DECLARATION OF COVENANTS 065
AND RESTRICTIONS ("Agreement') is made and entered into this 15r" day of
__J-dNE , Zoil , by and between the Community Redevelopment Agency of
THE CITY OF PALM SPRINGS, a public body, corporate and politic ("Agency"), and PS
HOUSING INVESTORS, LP, a California Limited Partnership ("Owner").
RECITALS:
A. Pursuant to an Owner Participation Agreement by and between Agency
and Owner dated SJNE 16 , 2011 (the "OPA"), Agency has provided to
Owner financial assistance in the amount of approximately One Million Dollars
($1,000,000.00) in loan funds (the "Agency Assistance"), for the purpose of assisting
Owner in the acquisition of real property and the rehabilitation of a mixed use residential
apartment complex thereon wherein twenty percent of the units shall be rented to low
income households and eighty percent of the units shall be rented to moderate income
households, on that certain real property located in the City of Palm Springs, County of
Riverside, State of California, more particularly described in Exhibit "A" attached hereto
and incorporated herein by reference (the "Site").
B. Pursuant to the OPA, Owner has agreed to rehabilitate and maintain a
rental apartment housing project consisting of twenty four (24) total residential units
(hereinafter referred to collectively as the 'Project') on the Site. The Project is also
referred to in the OPA as the 'Project," and is further described in the Scope of
Development attached to the OPA.
I ORIGINAL LID
MD/OR AGREEMENT
REGULATORY AGREEMENT AND
DECLARATION OF COVENANTS AND RESTRICTIONS
FREE RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
COMMUNITY REDEVELOPMENT AGENCY
OF THE CITY OF PALM SPRINGS
3200 Tahquitz Canyon Way, P.O. Box 2743
Palm Springs, CA 92263
Attn: Executive Director
(Space Above This Line for Recorder's Office Use Only)
REGULATORY AGREEMENT AND
DECLARATION OF COVENANTS AND RESTRICTIONS
THIS REGULATORY AGREEMENT AND DECLARATION OF COVENANTS
AND RESTRICTIONS ("Agreement') is made and entered into this 1" day of
J�NG ZOI I , by and between the Community Redevelopment Agency of
THE CITY OF PALM SPRINGS, a public body, corporate and politic ("Agency"), and PS
HOUSING INVESTORS, LP, a California Limited Partnership ("Owner").
RECITALS:
A. Pursuant to an Owner Participation Agreement by and between Agency
and Owner dated SJnfE. 15 , 2011 (the "OPA"), Agency has provided to
Owner financial assistance in the amount of approximately One Million Dollars
($1,000,000.00) in loan funds (the "Agency Assistance"), for the purpose of assisting
Owner in the acquisition of real property and the rehabilitation of a mixed use residential
apartment complex thereon wherein twenty percent of the units shall be rented to low
income households and eighty percent of the units shall be rented to moderate income
households, on that certain real property located in the City of Palm Springs, County of
Riverside, State of California, more particularly described in Exhibit "A" attached hereto
and incorporated herein by reference (the "Site").
B. Pursuant to the OPA, Owner has agreed to rehabilitate and maintain a
rental apartment housing project consisting of twenty four (24) total residential units
(hereinafter referred to collectively as the "Project") on the Site. The Project is also
referred to in the OPA as the "Project," and is further described in the Scope of
Development attached to the OPA.
t IDUPLIC,A" a-
C. The Agency and the City of Palm Springs have fee or easement interests
in various streets, sidewalks and other property within the City and are responsible for
the planning and development of land within the City in such a manner so as to provide
for the health, safety and welfare of the residents of the City. That portion of the
Agency's and City's interest in real property most directly affected by this Agreement is
depicted in Exhibit "B" attached hereto and incorporated herein by reference ("Public
Parcel").
D. Agency, City, and Owner now desire to place restrictions upon the use
and operation of the Project, in order to ensure that the Project shall be operated
continuously as a rental apartment housing project with the units available for rental by
low income persons for the term of this Agreement.
AGREEMENT:
NOW, THEREFORE, the Owner and Agency declare, covenant and agree, by
and for themselves, their heirs, executors, administrators and assigns, and all persons
claiming under or through them, that the Site shall be held, transferred, encumbered,
used, sold, conveyed, leased and occupied, subject to the covenants and restrictions
hereinafter set forth, all of which are declared to be in furtherance of a common plan for
the improvement and sale of the Site, and are established expressly and exclusively for
the use and benefit of the Agency, the residents of the City of Palm Springs, and every
person renting a dwelling unit on the Site.
AFFORDABILITY RESTRICTIONS RUNNING WITH LAND
In addition to the covenants and conditions contained in the Agreement, the
following California Community Redevelopment Law (California Health & Safety Code
Section 33000 et seq.) affordability requirements shall be imposed upon the 24
Affordable Units on the Property funded under the Agreement and shall bind the Owner
and all purchasers of the Property and their successors for a fifty-five (55) year period.
The Affordable Units on the Property are held and will be held, transferred,
encumbered, used, sold, conveyed and occupied subject to the covenants, restrictions,
and limitations set forth in this Exhibit, all of which are in furtherance of the Project, the
Agency's Community Redevelopment Law and Plan Area obligations including
Agency's obligations set forth at California Health & Safety Code sections 33334.2 et
seq and 33413 (a) with respect to Housing Set Aside Funds and replacement dwelling
units at affordable rent within the jurisdiction of the Agency. All of the restrictions,
2
covenants and limitations will run with the land and will be binding on all parties having
or acquiring any right, title or interest in the Affordable Units upon the Property or any
part thereof, will inure to the benefit of the Agency, and will be enforceable by it. Any
purchaser under a contract of sale or other transferee of an interest covering any right,
title or interest in any part of the Affordable Units upon the Property, by accepting a
deed or a contract of sale or agreement of purchase, accepts the document subject to,
and agrees to be bound by, any and all restrictions, covenants, and limitations set forth
in this Exhibit for the period of fifty-five (55) years running from and after recordation of
Agency's Certificate of Completion constituting the Affordability Period.
1. Restrictions. The following covenants and restrictions ("Restrictions") on the use
and enjoyment of the Affordable Units upon the Property shall be in addition to any
other covenants and restrictions affecting the Property, and all such covenants and
restrictions are for the benefit and protection of the Agency and shall run with the
Affordable Units upon the Property and be binding on any future owners of the Property
and inure to the benefit of and be enforceable by Agency. These covenants and
restrictions are as follows:
a. From the date of recordation of Agency's Certificate of Completion until
the expiration of the Affordability Period the twenty four (24) Affordable Units funded
under the Agreement are to be used as Low Income Affordable Rental Housing as
provided for in the Agreement. Owner agrees to file a recordable document setting forth
the project Completion Date and the Affordability Period as and when determined by the
Agency. Unless otherwise provided in the Agreement, the term "Affordable Rental
Housing" shall include without limitation compliance with the following requirements:
Nondiscrimination. There shall be no discrimination against nor
segregation of any person or group of persons on account of race, color,
creed, religion, sex, marital status, national origin, ancestry, or handicap in
the sale, transfer, use, occupancy, tenure, or enjoyment of any of the
Property, nor shall Owner or any person claiming under the Owner,
establish or permit any practice of discrimination or segregation with
reference to the selection, location, number, use or occupancy of owners
or vendees of the Property.
Principal Residence. Each of the Affordable Units upon the Property shall
be leased only to natural persons, who shall occupy such as a principal
residence.
3
Income Requirements. Each of the 24 Units constituting Low Income
Affordable Rental Housing upon the Property may be leased only to (a)
natural person(s) whose annual household income at the time of initial
occupancy is not greater than sixty percent (60%) of the most recent
annual median income calculated and published by HUD for the
Riverside-San Bernardino Metropolitan Statistical Area applicable to such
household's size, and at an affordable price consistent with the applicable
California Redevelopment Law.
Injunctive Relief and Recapture. Should any of the 24 Affordable Units
constituting Low Income Affordable Rental Housing upon the Property not
continue to be, at the time of initial occupancy, the principal residence of a
Household that qualifies as a low-income household, during the period of
Affordability, such Unit(s) shall be made available for subsequent lease
only to Households that qualify as a very low-income for use as the
Household's principal residence.
2. Enforcement of Restrictions. Without waiver or limitation, the Agency shall be
entitled to injunctive or other equitable relief against any violation or attempted violation
of the Restrictions, and shall, in addition, be entitled to damages for any injuries or
losses resulting from any violations thereof.
3. Acceptance and Ratification. All present and future owners of the Property and
other persons claiming by, through, or under them shall be subject to and shall comply
with the above Restrictions. The acceptance of a deed of conveyance to the Property
shall constitute an agreement that the Restrictions, as such may be amended or
supplemented from time to time, is accepted and ratified by such future owners, tenant
or occupant, and such Restrictions shall be a covenant running with the land and shall
bind any person having at any time any interest or estate in the Property, all as though
such Restrictions were recited and stipulated at length in each and every deed,
conveyance, mortgage or lease thereof.
4. Benefit. This Exhibit and the Restrictions therein shall run with and bind the
Property for a term commencing on the date the Agreement to which this Exhibit is
attached is recorded in the Office of the Recorder of the County of Riverside, State of
California, and expiring upon the expiration of the Affordability Period. The failure or
delay at any time of Agency and/or any other person entitled to enforce these
Restrictions shall in no event be deemed a waiver of the same, or of the right to enforce
4
the same at any time or from time to time thereafter, or an estoppel against the
enforcement thereof.
5. Costs and Attorney's Fees. In any proceeding arising because of failure of
Owner or any future owner of the Property to comply with the Restrictions required by
this Exhibit, as may be amended from time to time, Agency shall be entitled to recover
its respective costs and reasonable attorney's fees incurred in connection with such
default or failure.
6. Waiver. Neither Owner nor any future owner of the Property may exempt itself
from liability for failure to comply with the Restrictions required in this Exhibit.
7. Severability. The invalidity of the Restrictions or any other covenant, restriction,
condition, limitation, or other provision of this Exhibit shall not impair or affect in any
manner the validity, enforceability, or effect of the rest of this Exhibit and each shall be
enforceable to the greatest extent permitted by law.
8. Pronouns. Any reference in this Exhibit and the Restrictions therein to the
masculine, feminine, or neuter gender herein shall, unless the context clearly requires
the contrary, be deemed to refer to and include all genders. Words in the singular shall
include and refer to the plural, and vice versa, as appropriate.
9.. Interpretation. The captions and titles of the various articles, sections,
subsections, paragraphs, and subparagraphs of this Exhibit are inserted herein for
ease and convenience of reference only and shall not be used as an aid in interpreting
or construing this Exhibit or any provision hereof.
10.. Capitalized Terms. All capitalized terms used in this Exhibit, unless otherwise
defined herein, shall have the meanings assigned to such terms in the Agreement.
11. Amendments. This Agreement shall be amended only by a written instrument
executed by the parties hereto or their successors in title, and duly recorded in the real
property records of the County of Riverside.
12. Notice. Any notice required to be given hereunder shall be made in writing and
shall be given by personal delivery, certified or registered mail, postage prepaid, return
receipt requested, at the addresses specified below, or at such other addresses as may
be specified in writing by the parties hereto:
5
Agency: Community Redevelopment Agency
of the City of Palm Springs
3200 Tahquitz Canyon Way
P.O. Box 2743
Palm Springs, CA 92263
Attn: Executive Director
Copy to: WOODRUFF, SPRADLIN & SMART, APC
555 Anton Boulevard, Suite 1200
Costa Mesa, California 92626
Attention: Douglas C. Holland, Esq.
Owner: PS Housing Investors, LP
c/o GLOBAL PREMIER DEVELOPMENT,
INC., its Administrative General Partner
2010 Main St. Suite 1250
Irvine, Ca. 92614
Attn: Andrew Hanna, President
Copy to:
The notice shall be deemed given three (3) business days after the date of
mailing, or, if personally delivered, when received.
13. GOVERNING LAW. This Agreement shall be governed by the laws of the State
of California.
14. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall constitute one original and all of which shall be one
and the same instrument.
[END -- SIGNATURES ON NEXT PAGE]
6
IN WITNESS WHEREOF, the Agency and Owner have executed this Regulatory
Agreement and Declaration of Covenants and Restrictions by duly authorized
representatives on the date first written hereinabove.
"AGENCY"
COMMUNITY REDEVELOPMENT
AGENCY OF THE CITY OF PALM
SPRINGS, a public body, corporate and
politic
David H. Read h.D
Executive Dir or
ATTEST:
JAMES THOMPSON
PROVED BY CITY COUNCIL
y Clerk
APPROVED AS TO FORM:
DOU C. HOLLANp
AGEN COUNSEL
"OWNER"
PS Housing Investors, LP, a California
Limited Partnership
By:
GL BAL PREMIiWDEVELOPMENT,
INC., its Administrative General Partner
ANDREW HANNA, President
[END OF SIGNATURES]
Attachments: Exhibit A Legal Description of Property
7
CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
State of California
County of e)oo t C=E
On 6)3/Qptt beforeme,
Date �\12Y Pl-d Cs.l AL° ,
Here Inseri ame and Tnle of the Officer -
Personally appeared Ar.�iJrLv 1 larJtJA
Namels)ol Signers)
who proved to me on the basis of satisfactory evidence to
be the person{s) whose namel(g)Oare subscribed to the
within instrument and acknowledged to me that
r t?{she/they executed the same in®her/their authorized
GINA ELDUAYEN capacity,(ie� , and that by�er/their signatureW on the
Commission M 1905851 instrument the erson entity p L
= p (a'J; or the enti u on behalf of
Notary public -California z which the ersonOrange County p (s)acted, executed the instrument.
Comm. Expires Sep 27,2014 r
I certify under PENALTY OF PERJURY under the laws
of the State of California that the foregoing paragraph is
true and correct.
WITNESS my hand and official seal.
Place Notary Seal Above Signature
Synawre of N la 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:
Signers) Other Than Named Above:
Capacity(ies) Claimed by Signer(s)
Signer's Name: Signer's Name:
Individual G Individual
L Corporate Officer—Title(s): ❑Corporate Officer—Title(s):
Partner—G Limited D General _ _ El Partner—1-1 Limited ❑ General zma
Fj Attorney in Fact • - ❑Attorney in Fact
Fj Trustee Top of thumb here ❑Trustee Top o1 thumb Here
Guardian or Conservator ❑Guardian or Conservator
Other:_ _ ❑Other-
Signer Is Representing: Signer Is Representing:
I
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ACKNOWLEDGMENT OF INSTRUMENT
(Cal. Civil Code Section 1181)
State of California )
County of Riverside ) ss
City of Palm Springs)
On August 4, 2011, before me, JAMES THOMPSON, CITY CLERK, CITY OF
PALM SPRINGS CALIFORNIA, personally appeared DAVID H. READY, who I
personally know is the CITY MANAGER of the CITY OF PALM SPRINGS, and the
EXECUTIVE DIRECTOR of the CITY OF PALM SPRINGS COMMUNITY
REDEVELOPMENT AGENCY whose name is subscribed to the within instrument and
that he executed the same in his official and authorized capacity on behalf of the City of
Palm Springs, a California Charter City and the City of Palm Springs Community
Redevelopment Agency.
I certify under PENALTY OF PERJURY under the laws of the State of California
that the foregoing paragraph is true and correct.
Witness my hand and the official seal of the City of Palm Springs, California, this
4th day of August, 2011:
•04p PLM sp4
.y
o
V N
C4tIFO RN`P,
Signature:
MS THOMPSON' Cl
TY CLERK
City of Palm Springs, California
Title or Type of Document:
Document Date: ��� 5/ 2O t f Number of Pages: Ic
EXHIBIT A TO REGULATORY AGREEMENT
LEGAL DESCRIPTION
All that certain real property situated in the City of Palm Springs, County of Riverside,
State of California, described as follows:
Parcel A:
Lots 33 and 34 of Palm Springs Estates No. 3, in the City of Palm Springs, County of Riverside,
State of California, as per map recorded In Book 17, Page 34, of Maps, in the Office of the County
Recorder of said County.
Except the East 4.50 feet.
Also Except the right to any deposit of oil, gas or other hydrocarbon substances underlying said
land, as reserved by California Trust Company, a Corporation, in deed recorded February 28, 1929
in Book 801, Page 81 of Deeds, records of Riverside County, California.
Parcel B:
Lots 35 and 36 of Palm Springs Estates No. 3, in the City of Palm Springs, County of Riverside,
State of California, as per map recorded in Book 17, Page 34, of Maps, in the Office of the County
Recorder of said County.
Excepting therefrom that portion conveyed to the City of Palm Springs by Deed recorded April 22,
1953 in Book 2258, Page 431 of offlclal Records of Riverside County, California.
Also Excepting the right to any deposit of oil, gas or other hydrocarbon substances underlying said
land, as reserved by California Trust Company, a Corporation, in deeds recorded March 29, 1932 in
Book 70, Page 394 of Official Records of Riverside County, California, as to said Lot 1, and recorded
February 28, 1929 In Book 302, Page 4 of Deeds, records of Riverside County, Callfornia, as to said
Lots 3S and 36.
Parcel C:
Lot 32 of Palm Springs Estates No. 3, in the City of Palm Springs, County of Riverside, State of
Cairfornia, as per map recorded in Book 17, Page 34, of Maps, in the Office of the County Recorder
of said County.
Except the right to any deposit of oil, gas or other hydrocarbon substances underlying said land, as
reserved by California Taut Company, in deed recorded February 19, 1929 in Book 798, Page 465
of Deeds, records of Riverside County, California.
Assessor's Parcel Nos. 505-184-019, 020, 027
9
DOC # 2011-0377010
08/25/2011 10:47A Fee:NC
Page 1 of 77
Recorded in Official Records
IAV% County of Riverside
RECORDED AT THE REQUEST OF Larry W. Ward
AND WHEN RECORDED RETURN TO: Assessor, County Clerk & Recorder
IIIIIIIIIIIIII III oil IIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIII
Community Redevelopment Agency of the City of Palm Springs
3200 Tahquitz Canyon Way, P.O. Box 2743
Palm Springs, Ca. 92263 S R U I PAGE I SIZE I DA I MISC LONG RFD COPY
Attention: Executive Director 171
M A L 465 426 PCOR NCOR SMF CH EXAM
6) (SPACE ABOVE THIS LINE FOP 06S
r-� T: CTY UNI
This Agreement is recorded at the request and for the benefit of the Community
Redevelopment Agency of the City of Palm Springs and is exempt from the payment of
a recording fee pursuant to Government Code Section 6103. T
0G6
COMMUNITY REDEVELOPMENT
AcconloDATION AGENCY OF THE CITY PALM SPRINGS
This document debvered to Recon'.
man accunmmodation wtt) 'at file
express request"f the Parties beret". By.
It has not been examwed as to
It's effect of va idity. Its: Executive Direct
Dated:
OWNER PARTICIPATION AGREEMENT
by and between
Community Redevelopment Agency of the City of Palm Springs,
a public body, corporate and politic
and
PS Housing Investors, LP, a California Limited Partnership
for
1433 and 1455 North Indian Canyon Drive
Residential Rental Project
Palm Springs, CA 92262
t ORIGINAL BID
AND/OR AGREEM17NIT
RECORDED AT THE REQUEST OF
AND WHEN RECORDED RETURN TO:
Community Redevelopment Agency of the City of Palm Springs
3200 Tahquitz Canyon Way, P.O. Box 2743
Palm Springs, Ca. 92263
Attention: Executive Director
(SPACE ABOVE THIS LINE FOR RECORDER'S USE)
This Agreement is recorded at the request and for the benefit of the Community
Redevelopment Agency of the City of Palm Springs and is exempt from the payment of
a recording fee pursuant to Government Code Section 6103.
COMMUNITY REDEVELOPMENT
AGENCY OF THE CITY 0 ALM SPRINGS
c
B �?J✓
Its: Executive Direct
Dated: i
OWNER PARTICIPATION AGREEMENT
by and between
Community Redevelopment Agency of the City of Palm Springs,
a public body, corporate and politic
and
PS Housing Investors, LP, a California Limited Partnership
for
1433 and 1455 North Indian Canyon Drive
Residential Rental Project
Palm Springs, CA 92262
17)0PLICA'r t:
t :1PIC3INAL.
ATTACHMENTS
1. Exhibit A: Legal Description of Property
2. Exhibit A-1: Location Map of the Property
3. Exhibit B: Schedule of Performance/Payment Schedule
4. Exhibit C: Budget/Financial Plan
5. Exhibit D: Certificate of Completion
6. Exhibit E: Basic Design
7. Exhibit F: Affordability Restrictions Running with Land.
7. Exhibit G: Promissory Note
8. Exhibit H: Deed of Trust and Assignment of Rents
2
OWNER PARTICIPATION AGREEMENT
THIS OWNER PARTICIPATION AGREEMENT ("Agreement') is entered as of
the Effective Date (defined in this Agreement), between the Community Redevelopment
Agency of the City of Palm Springs, a public body, corporate and politic, ("Agency') and
PS Housing Investors, LP, a California Limited Partnership ("Owner").
RECITALS
The parties enter this Agreement based on the following facts, understandings,
and intentions:
A. By authority granted under California Redevelopment Law (the "Law'), the
Agency has prepared and is responsible for carrying out the Amended and Restated
Redevelopment plan for the Merged Redevelopment Project Area No. 1 (the "Plan").
B. To the extent provided in or allowed by the Law including Cal. H.&S.C. Sections
33334.2 and 33449, as provided by joint resolutions of the Palm Springs City Council
and the Agency, findings and determinations pursuant to Health and Safety Code
Section 33334.2.(g), the Plan and limited to the terms and conditions therein, the
Agency may make improvements upon and/or construct and improve structures in order
to provide housing for persons and families of low or moderate income, by variously (1)
allowing the use of Housing Set Aside Funds outside the Project Areas and (2) placing
a priority on the use of the Housing Set Aside Funds from the Project Areas to be used
either within or adjacent to the Project Areas.
C. Agency administers the Low and Moderate Income Housing Fund established
pursuant to Cal. HAS. C. Sections 33334.2 et seq.
D. The Agency shall permit owner participation in the redevelopment of property in
the Plan area in conformity with the Plan and all owner participation rules and criteria, to
the extent provided by Cal. H.&S.C. Sections 33339, 33339.5, 33380 and 33381 .
E. At the effective date for the Agency, Owner shall hold all right, title and interest in
fee to the certain real property described in Exhibit "A" attached hereto and incorporated
herein (the `Property"), including improvements located thereon which shall be
improved by Owner as contemplated by this Agreement and known as the Sunset Palm
Project located at 1433 and 1455 North Indian Canyon Drive, Palm Springs, California
(the `Project'). The Property and Project are located within the territorial jurisdiction of
the Agency.
F. Owner proposes to acquire and renovate a residential rental project on the
Property consisting of twenty four (24) residential units. All of the residential units (the
"Affordable Units") are to be rented and preserved as Affordable Rental Housing.
3
G Owner agrees to undertake improvements in accordance with the combined
Schedule of Performance described in Exhibit B attached hereto and incorporated
herein (the "Schedule of Performance").
H. To the extent Housing Set Aside Funds will exceed 50 percent of the cost of
producing the Affordable Units, the Agency has determined based on substantial
evidence, that the use of the Funds is necessary because the Agency or Owner of the
Affordable Units has made a good faith attempt but been unable to obtain commercial
or private means of financing the units at the same level of affordability and quantity.
The Project is not feasible and cannot be completed and restricted to the affordable
rental housing purposes and uses provided under Law and this Agreement absent the
financial support of the Agency.
I. The Property and associated on site and off site improvements are collectively
referred to in this Agreement as the "Improvements" or the "Project," all of which will
directly benefit the Property and the Plan area, cannot otherwise be reasonably paid for
or financed, and are necessary to eliminate blight.
J. Agency is willing to assist Owner's acquisition and reconstruction of the
Affordable Units by making available to Owner as a loan certain Housing Set Aside (Tax
Increment) Funds in the amount of $1,500,000 (the "Loan") upon the terms and
conditions specified this Agreement.
K. The Loan shall be paid in accordance with the schedule set out in Exhibit B to the
Agreement and repaid in accordance with the promissory note a specimen of which is
attached hereto as Exhibit G. The Loan and performance of the affordability and other
covenants and restrictions set forth in this Agreement shall be evidenced by this
Agreement and the Restrictions and Loan deed of trust which shall be recorded against
and run with and encumber the Property.
L. The Project has been environmentally assessed under the California
Environmental Quality Act (CEQA), resulting in a Categorical Exemption. Based on the
review, City staff determined that the project is consistent with all of the criteria specified
for an exemption to the California Environmental Quality Act (CEQA) in accordance with
Section 15301/Class 1 of the CEQA Guidelines for existing facilities.
M. Agency has further determined this Project is in the best interests of, and will
materially contribute to, Plan implementation. Further, Agency has found the Project: (i)
will have a positive influence in the Plan Area, and surrounding environs, (ii) is in the
vital and best interests of Agency and the health, safety, and welfare of City residents,
(iii) complies with applicable federal, state, and local laws and requirements, (iv) will
help eliminate blight, (v) will improve and preserve the community's supply of low and
moderate income housing available at affordable rent, as defined by Cal. H.&S.C.
Sections 50052.5 and 50053, to persons and families of low or moderate income, as
defined in Cal. H.&S.C. Section 50093 of Code; (vi) will be available to meet the
replacement housing provisions in Cal. H.&S.C. Section 33413; (vii) will apply funds
4
solely within the respective Plan areas except to the extent otherwise provided herein
and allowed by Law; (viii) all planning and administrative expenses incurred in pursuit
hereof are necessary for the production, improvement, or preservation of low- and
moderate-income housing; and (ix) will comply with all owner participation rules and
criteria of Agency and the Plan.
O. The Owner and the Agency have determined that this Agreement is not subject
to Article XXXIV of the California Constitution.
AGREEMENT
1. DEFINITIONS. Besides definitions contained elsewhere in this Agreement, the
definitions in this Section will govern the construction, meaning, application and
interpretation of the various terms used in this Agreement.
1.1 "ADA" means the Americans with Disabilities Act of 1990.
1.2 "Affordability Period" means a period of fifty-five (55) years commencing
from the date Agency records the Certificate of Completion.
1.3 "Affordable Rental Housing" or Affordable Units means the Units available
at affordable rent, as defined by Cal. H.&S.C. Section 50052.5 (4), to
persons and families of low and moderate income, as defined in Cal.
H.&S.C. Section 50093 of Code, consistent with Recital F above which
requirements shall be enforceable by covenants running with the land. As
used in this Agreement, the term "Affordable Low Income Rent' shall
mean annual rentals whose amount does not exceed the maximum
percentage of income that can be devoted to rent as set forth by Health &
Safety Code Section 50053, or its successor, which is currently thirty
percent (30%) of sixty percent (60%) of the Riverside County Median
Income adjusted for the family size appropriate for the Unit.
1.4 "Agency" means the Community Redevelopment Agency of the City of
Palm Springs, a public body, corporate and politic, organized and existing
under the Law, and any assignee of or successor to its rights, powers and
responsibilities.
1.5 The term "Agency Notes" shall mean those certain combined promissory
notes for an amount of One Million Five Hundred Thousand Dollars
($1,500,000) representing the cash loan contribution from the Agency to
the Owner for the Project. A form of the Agency Notes are attached
hereto as Exhibit G-1 and G-2 and incorporated herein by this reference.
1.6 "Agreement' means this Owner Participation Agreement, including all
attachments, which attachments are a part hereof and incorporated herein
in their entirety, and all other documents incorporated herein by reference.
5
1.6 "Budget" means the Budget/Financial Plan for the Project attached hereto
and incorporated herein as Exhibit "C."
1.7 "Certificate of Completion" means that Certificate issued in the form
attached as Exhibit "D" to Owner by Agency evidencing completion of the
Project for purposes of this Agreement.
1.8 The term "City" shall mean the City of Palm Springs, a chartered municipal
corporation.
1.9 The term "Closing" or "Closing Date" shall mean the closing of the Escrow
for the acquisition of the Agency Parcel from Agency to Owner by the
Escrow Agent's distributing the funds and documents received through
Escrow to the party entitled thereto as provided herein, which closing shall
occur on or before the date established in the Schedule of Performance.
1 .10 "Conditions Precedent of Agency" means the conditions precedent to the
effectiveness of this Agreement against the Agency.
1.11 "Day" whether or not capitalized, means a calendar day, and not working
day, unless stated otherwise.
1.12 "Declaration of Restrictions" means the affordability restrictions contained
in this Agreement and Exhibit F thereto, containing all conditions,
covenants, and restrictions required by the Law, any other applicable laws
and regulations, the Plan, and this Agreement, running with the Property
and the Affordable Units thereon and burdening such for the Affordability
Period.
1.13 "Deed of Trust" shall refer to that deed of trust and assignment of rents
attached hereto as Exhibit H, securing Owner's obligations pursuant to the
Agency Note, the Agreement and the Regulatory Agreement which shall
be recorded on the Property.
1.14 "Default" means a party's failure to timely perform any action or covenant
required by this Agreement following notice and opportunity to cure.
1 .15 "Director" means the Executive Director of Agency.
1.16 "Entitlements' mean all permits and fees that the City, County of
Riverside, and other governmental agencies with jurisdiction over the
Project, the Improvements or the Property may require.
6
1.17 "Effective Date" means the date of complete execution of the Agreement
following Agency Board approval thereof.
1.18 "Environmental Laws" means any federal, state, or local law, statute,
ordinance or regulation pertaining to environmental regulation,
contamination or cleanup of any Hazardous Materials or waste including,
without limitation, any state or federal lien or "super lien" law, any
environmental cleanup statute or regulation, or any governmentally
required permit, approval, authorization, license, variance or permission.
1 .19 "Escrow" shall mean the escrow established pursuant to this Agreement
for the conveyance of Property title from the Seller to Owner, and shall
include the disbursement of Agency loan proceeds and the recordation of
the Agreement, Deed of Trust, and Regulatory Agreement.
1.20 "Escrow Agent' shall be mutually agreed upon by the Parties.
1.21 "Funding Source" means the Loan and other funding sources secured by
Owner to construct the Improvements.
1.22 "Financing Plan" means the Budget including sources and uses of funds
sufficient for Owner to complete the Improvements according to the
Schedule of Performance.
1.23 "Hazardous Materials" means any substance, material, or waste which is
or becomes regulated by any local governmental authority, the State of
California, or the United States Government including, without limitation,
any material or substance which is: (a) defined as a "hazardous waste,"
"extremely hazardous waste," or "restricted hazardous waste" under
Sections 25115, 25117, or 25122.7, or listed pursuant to Section 25140 of
the California Health and Safety Code, (b) defined as a "hazardous
substance" under Section 25316 of the California Health and Safety Code,
(c) defined as a "hazardous material," "hazardous substance," or
"hazardous waste" under Section 25501 of the California Health and
Safety Code, (d) defined as a "hazardous substance" under Section 25281
of the California Health and Safety Code, (e) petroleum, (f) friable
asbestos, (g) polychlorinated byphenyls, (h) listed under Article 9 or
defined as "hazardous" or "extremely hazardous" under Article 11 of Title
22, California Administrative Code, (1) designated as "hazardous
substances" pursuant to Section 311 of the Clean Water Act (33 U.S.C.
§1317), 0) defined as a "hazardous waste" pursuant to Section 1004 of the
Resource Conservation and Recovery Act (42 U.S.C. §6901 et seq., or (k)
defined as "hazardous substances" pursuant to Section of the
Comprehensive Environmental Response, Compensation, and Liability
Act (42 U.S.C. §9601, et seq.); provided, however, hazardous materials
shall not include: (1) construction materials, gardening materials,
7
household products, office supply products or janitorial supply products
customarily used in the construction, maintenance, rehabilitation, or
management of residential rental housing or associated buildings and
grounds, or typically used in household activities, in a manner typical of
other residential rental housing developments which are comparable to
the Improvements; and (2) certain substances which may contain
chemicals listed by the State of California pursuant to Health and Safety
Code Sections 25249.8 et sec., which substances are commonly used by
a significant portion of the population living within the region of the
Property, including, but not limited to, alcoholic beverages, aspirin,
tobacco products, NutraSweet and saccharine.
1.24 "Household" means one or more persons occupying an Affordable Unit.
1.25 "Housing Set-Aside Funds" means those California Health and Safety
Code Section 33334.2 monies held and administered by Agency a portion
of which shall be made available as the Loan to Owner for eligible costs
and expenses incurred by Owner in constructing the Improvements in
such amounts, and upon such terms and conditions specified in this
Agreement.
1.26 "Improvements" mean the construction of the Affordable Units and other
units that Owner will complete on the Property as part of the Project,
including associated fencing, and landscaping improvements.
1.27 "Law" means the Community Redevelopment Law of the State (California
Health and Safety Code Sections 33000 et seq.).
1.28 "Loan" means the principal sum of $1,500,000 provided by Agency to
Owner as a loan, upon the terms and conditions set forth in this
Agreement and the Promissory Notes attached hereto as Exhibit G to be
secured by a no worse than [3rd position] deed of trust lien against the
Property. If the deed of trust securing the Promissory Note is recorded
prior to the recordation of the deed or deeds of trust securing the other
Funding Sources consistent with the Financing Plan, the Agency shall
subordinate such deed of trust to such other deed(s) of trust.
1.29 "Loan Documents" are collectively this Agreement and all exhibits and
attachments thereto any deed of trust given as security, as they may be
amended, modified or restated from time to time.
1.30 The term "Lower Income Household" shall mean a household whose
annual household income does not exceed eighty percent (80%) of area
median income for Riverside County, adjusted for applicable household
size, as computed in accordance with the Community Redevelopment
Law and the regulations promulgated pursuant thereto or incorporated
8
therein, including, without limitation, all regulations promulgated pursuant
to Health and Safety Code Section 50093, or any successor statute.
1.31 "Material Change" means a change, modification, revision or alteration to
the Loan Documents that significantly deviates from those previously
approved by the Agency, provided that fully funded change(s) which do
not result in a change in the number or type (i.e. residential, affordable) of
Units and/or an increase in the total Loan funding provided in this
Agreement shall not constitute Material Change(s).
1.32 "Owner' means PS Housing Investors, LP, a California Limited
Partnership, a partnership containing Global Premier Development, Inc. as
Administrative General Partner., 2010 Main St. Suite 1250, Irvine, Ca.
92614, Andrew Hanna, President. Owner warrants and represents to
Agency that Owner is qualified to do business in good standing under the
laws of the State of California and has all requisite power and authority to
carry out Owner's business as now and whenever conducted and to enter
into and perform Owner's obligations under this Agreement.
1.33 "Plan" means the Redevelopment Plan for the Merged Project Area No. 1
in the City of Palm Springs, as adopted by Ordinance No. 1584 of the City
Council on May 31, 2000 and as such Redevelopment Plan has been
amended from time to time. Agency hereby warrants and represents that
the Redevelopment Plan was validly adopted and is in full force and effect,
that the applicable limitations period for challenging the validity of the
Redevelopment Plan has expired and that the proposed Project is in
accordance with and permissible under the Redevelopment Plan. A copy
of the Redevelopment Plan is on file in the office of the City Clerk of the
City, located at 3200 East Tahquitz Canyon Way, Palm Springs, California
92262. The Redevelopment Plan is incorporated herein by reference and
made a part hereof as though fully set forth herein.
1.34 "Project" means the rehabilitation of 24 residential Units on the Property,
of which all Units shall be Low Income Housing. The term "Project" shall
mean all of the improvements required to be constructed by Owner on the
Site pursuant to this Agreement, including, but not limited to, rehabilitation
of buildings, glass and concrete work, landscaping, repaving and
improvement of parking areas, and related improvements. The overall
Project is more particularly described in the Scope of Development/Basic
Design attached hereto as Exhibit E. Upon completion, the Project will be
a twenty four (24) unit residential apartment.
1.35 "Project Area" or "Redevelopment Project Area" means the Merged
Project Area No. 1, which is located in the City of Palm Springs, California.
The exact boundaries of the Redevelopment Project Area are specifically
described in the Redevelopment Plan.
9
1.36 "Project Completion Date" means the date that Agency shall have
determined the Project has reached completion in accordance with the
plans and specifications in the Schedule of Performance, as evidenced by
Agency's issuance of a Certificate of Completion.
1.37 "Property" means the real property described in Exhibit "A".
1.38 "Qualified Tax Credit Investor' shall mean a person or entity who (i) is an
experienced investor in multifamily housing developments receiving low
income housing tax credits issued by the State of California or the United
States federal government ("Tax Credits"), and (ii) has obtained or is
contractually obligated to obtain a corporation or limited liability company
membership interest in the Owner whereby it will receive ninety percent
(90%) or more of the Tax Credits obtained in connection with the Project.
1.39 Qualified Tenant. The term "Qualified Tenant" shall mean those
households seeking to rent a Restricted Unit who satisfy all of the
following requirements:
1. Upon execution of a lease with Owner pursuant to this
Agreement, each member of the household will occupy a
Restricted Unit as its principal residence, and each member
intends to thereafter continuously occupy such Restricted
Unit as its principal residence.
2. Upon execution of a lease with Owner pursuant to this
Agreement, the household is a Very Low or Lower Income
Household.
3. The household has been selected in accordance with the
tenant selection criteria set forth in the Regulatory
Agreement.
1.40 "Regulatory Agreement" shall mean that Regulatory Agreement and
Declaration of Covenants and Restrictions attached hereto as Exhibit F,
running with the land and providing for the proper maintenance of
common facilities and improvements and the management and use of the
Project and to ensure the Restricted Units remain affordable pursuant to
the terms of this Agreement.
1.41 "Release of Restrictions" means a release of those covenants, conditions
and restrictions contained in this Agreement.
1.42 The term "Restricted Unit" shall mean and refer to one of the twenty four
(24) apartment units in the Project which are restricted to occupancy by
this Agreement and the Regulatory Agreement to a Very Low or Lower
Income Household at an Affordable Rent. "Restricted Units" shall mean
10
and refer collectively to each and every Restricted Unit located on the
Site.
1.43 "Schedule of Performance" means the schedule attached as Exhibit "B,"
setting forth the dates and times by which the parties must accomplish
certain obligations under this Agreement. The parties may revise the
Schedule of Performance from time to time on mutual written agreement
of Owner and Agency, but any delay or extension of the Completion Date
is subject to the requirements in this Agreement.
1.44 "Security Financing Interest" means a security interest which Owner
grants in the Property and the Improvements thereon before the Agency
issues and records a Release of Restrictions.
1.45 "Unit" mean a residential unit constituting the Project.
1.46 The term "Very Low Income Household" shall mean a household whose
annual household income does not exceed fifty percent (50%) of area
median income for Riverside County, adjusted for applicable household
size, as computed in accordance with the Community Redevelopment
Law and the regulations promulgated pursuant thereto or incorporated
therein, including, without limitation, all regulations promulgated pursuant
to Health and Safety Code Section 50093, or any successor statute.
2. AGENCY'S PERFORMANCE UNDER THIS AGREEMENT.
Upon the satisfaction of the conditions precedent to Agency's obligation to
perform under this Agreement describe in Section 2.1 through 2.7 below, the
Agency shall make its contribution to the Project under the terms contained in
Section 2.8.
CONDITIONS PRECEDENT TO AGENCY'S OBLIGATION TO PERFORM
UNDER THIS AGREEMENT. The following are conditions precedent to
Agency's obligation to perform under this Agreement. Until each and all of the
conditions are satisfied, Agency is not obligated to take any action, or provide
any funding under this Agreement. Agency, in writing by its authorized
representative, may waive any condition or agree to extend the time for
satisfaction of any condition set forth in this Section 2. Agency may terminate
this Agreement as provided herein for the failure of a condition.
2.1 Owner shall pay for and provide a title report, recorded deed or other
evidence acceptable to Agency that Owner owns or is in escrow to
purchase the Property.
2.2 Owner has entered into, and provided Agency copies of agreements with
any and all funding sources and the general contractor for the Project. All
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such funding source agreements shall contain a provision whereby the
party(ies) to each such agreement, other than Owner, agree to make
reasonable efforts to (i) notify Agency immediately of any event of default
by Owner under such agreement; (ii) notify Agency immediately of
termination or cancellation of such agreement; and (iii) provide Agency,
upon Agency's request, an estoppel certificate certifying that such
agreement is in full force and effect and Owner is not in default under such
agreement.
2.3 Owner has submitted evidence that the combined monies from the
Funding Sources are not less than the greater of a total development cost
of $3,450,847 or the amount which Agency determines is necessary to
complete the Project. If Agency determines that said funds are not
sufficient to complete the Project, Owner may satisfy this condition as
agreed to by Owner and Agency in writing.
2.4 Owner will submit its Financing Plan to the Agency for review and
acceptance provided that the purpose of Agency's review is solely to
confirm Owner has sufficient funds available to complete the
Improvements and maintain Project as this Agreement requires.
After Agency accepts the Financing Plan, Owner will not make any
Material Change in the Financing Plan without first submitting such
change to Agency for review and acceptance, which shall not be
unreasonably withheld, delayed or conditioned.
2.5 Owner, at Owner's expense, shall have investigated and determined all
environmental, soil, seismic, and other surface and subsurface conditions
of the Property and the suitability of such conditions for the Project.
Owner's responsibility and due diligence includes, but is not limited to,
determining the presence of Hazardous Materials. Both Owner and
Agency will promptly give the other copies of all reports and test results.
Owner will indemnify, defend, and hold Agency harmless from any
damages or claims arising out of Owner's inspections and tests.
2.6 Should Owner's property assessment/inspection reveal any Hazardous
Materials or environmental conditions requiring remediation, Owner will
promptly notify Agency. Not later than ten (10) days from and after such
notice, Owner shall, at its sole cost and expense, commence to make
required submittals, develop required remedial action plans, and thereafter
pursue remediation activities as to such Hazardous Materials or
environmental conditions and to diligently prosecute such to completion as
required by applicable federal, state and local law and in a manner and
according a reasonable time frame agreeable to Agency. Without limiting
the foregoing, any remediation will be performed pursuant to a remedial
action plan, if needed, approved by the governmental agencies having
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jurisdiction and will be performed according to applicable environmental
laws and governmental requirements.
2.7 Owner shall not be in default of this Agreement and all representations
and warranties of Owner contained herein shall be true and correct in all
material respects.
2.7.1 Owner will have signed and delivered all documents required
hereunder.
2.7.2 Owner will have received all land use and development approvals,
variances, permits and the like required by this Agreement.
2.8 Agency Financial Assistance. Agency agrees to provide certain financial
assistance to Owner to assist the Owner in the acquisition and
rehabilitation costs of the Project. The Agency shall loan the Owner
$1,500,000 to be used towards payment of the acquisition of the Property
and construction costs. The promissory notes for the cash loans ("Agency
Notes") shall be in the combined amount of One Million Five Hundred
Thousand Dollars ($1,500,000), for a term of 55 years, non-recourse, at
two percent (2%) interest per annum, or as determined necessary to
maximize the tax credit equity, with interest and principal payments to be
made out of a to be determined percentage of residual receipts after the
payment of customary expenses for the term of the loan.
The loans shall be disbursed within thirty (45) days of the approval of this
Agreement toward the acquisition of this Project, in two separate Notes:
one for $500,000 and one for $1,000,000. In no event shall the Agency's
cash contribution exceed a total of $1,500,000. The Agency has
committed up to $1,500,000 to the Project, with the goal of offsetting up to
$500,000 of the Agency's commitment through the receipt by the Owner of
HOME or AHP funds into the Project, leaving a commitment of $1,000,000
in a residual receipts loan. The $500,000 Note shall be repaid to the
Agency upon the successful award of HOME or AHP funds to the Project
in an amount no less than the $500,000.
The remaining construction funds shall be prorated between the other
governmental funds and the funds to be contributed by the Qualified Tax
Credit Investor and disbursed by the lenders during the construction of the
Project (the "Tax Credit Construction Equity"). The Agency Financial
Assistance and the completion and operation of the Project shall be
secured by the Agency's Deed of Trust attached hereto as Exhibit H;
provided that Agency's security shall be subordinated to Owner's
construction and permanent financing for the Project as approved by
Agency. The total cost of the Project as approved by Agency is estimated
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to be Three Million Four Hundred Fifty Thousand, Eight Hundred Forty
Seven Dollars ($3,450,847).
3 . OWNER OBLIGATIONS AFTER SATISFACTION OF CONDITIONS
PRECEDENT. The following obligations of Owner will run with the land and survive this
Agreement:
3.1 Owner will take all reasonable precautions to prevent the release into the
environment of any Hazardous Materials in, on or under the Property in
violation of applicable laws or regulations. Owner will comply with all
governmental requirements with respect to Hazardous Materials. In
addition, Owner shall install and use equipment and implement and follow
procedures that are consistent with reasonable standards for the
disclosure, storage, use, removal and disposal of Hazardous Materials.
3.2 Owner will notify the Agency and give Agency a copy of all environmental
permits, disclosures, applications, entitlements or inquiries relating to the
Property including, without limitation, notices of violation, notices to
comply, citations, inquiries, cleanup or abatement orders, cease and
desist orders, reports filed pursuant to self-reporting requirements and
reports filed or applications made pursuant to any governmental regulation
relating to Hazardous Materials. Within 3 days after each incident, Owner
will report to Agency any unusual or potentially important incidents
respecting the environmental condition of the Property.
If a release of any Hazardous Materials into the environment occurs,
Owner will, as soon as possible after the release, furnish Agency with a
copy of any reports relating thereto and copies of all correspondence with
governmental agencies relating to the release. Upon request, Owner will
furnish Agency with a copy of any other environmental entitlements or
inquiries relating to or affecting the Property including, without limitation,
all permit applications, permits and reports, even reports and other
matters.
3.3 From the Effective Date of this Agreement, Owner shall indemnify, hold
harmless and defend Agency, City and each of their officers, officials,
employees, agents and volunteers from any and all claim, action, suit,
proceeding, loss, cost, damage, liability, deficiency, fine, penalty, punitive
damage, or expense (including, without limitation, reasonable attorneys'
fees), arising out of (i) the presence, release, use, generation, discharge,
storage or disposal of any Hazardous Materials on, under, in or about the
Property, or the transportation of any Hazardous Materials to or from the
Property, or (ii) the violation, or alleged violation, of any statute, ordinance,
order, rule, regulation, permit, judgment or license relating to any use,
generation, release, discharge, storage, disposal or transportation of
Hazardous Materials on, under, in or about, to or from, the Property. This
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indemnity will include, without limitation, any damage, liability, fine,
penalty, parallel indemnity after closing, cost or expense arising from or
out of any claim, action, suit or proceeding for personal injury (including
sickness, disease or death), tangible or intangible property damage,
compensation for lost wages, business income, profits or other economic
loss, damage to the natural resource or the environment, nuisance,
contamination leak, spill, release or other adverse effect on the
environment. Owner's obligations under the preceding sentence shall
apply regardless of whether Agency, City or any of their officers, officials,
employees, agents or volunteers are negligent, but shall not apply to any
claim, action, suit, proceeding, loss, cost, damage, liability, deficiency,
fine, penalty, punitive damage, or expense caused solely by the gross
negligence, or caused by the willful misconduct, of Agency, City or any of
their officers, officials, employees, agents or volunteers. This section shall
survive expiration or termination of this Agreement.
3A The status and qualifications of Owner are of particular concern to
Agency. From the Effective Date of this Agreement until the Restrictions
expire, no voluntary or involuntary successor-in-interest of Owner will
acquire any rights or powers under this Agreement, provided that the
parties acknowledge the Owner shall hold the Affordable Units for rental
as Affordable Rental Housing as provided in this Agreement.
Notwithstanding anything to the contrary herein, Owner shall have the
right to transfer ownership of the Property to a Qualified Tax Credit
Investor as described in Section 1.33 of this Agreement, or another person
or entity having experience in the ownership and operation of Affordable
Rental Housing, as reasonably determined by Agency, which approval
shall not be unreasonably withheld, delayed or conditioned.
3.4.1 Transfer Defined. As used in this section, the term
"Transfer ' shall include any assignment, hypothecation,
mortgage, pledge, conveyance, or encumbrance of this
Agreement, the Site, or the improvements thereon. A
Transfer shall also include the transfer to any person or
group of persons acting in concert of more than twenty-five
percent (25%) of the present ownership and/or control of
Owner in the aggregate, taking all transfers into account on
a cumulative basis, except transfers of such ownership or
control interest between members of the same immediate
family, or transfers to a trust, testamentary or otherwise, in
which the beneficiaries are limited to members of the
transferor's immediate family. In the event Owner or its
successor is a corporation or trust, such transfer shall refer
to the transfer of the issued and outstanding capital stock of
Owner, or of beneficial interests of such trust; in the event
that Owner is a limited or general partnership, such transfer
15
shall refer to the transfer of more than twenty-five percent
(25%) of the limited or general partnership interest; in the
event that Owner is a joint venture, such transfer shall refer
to the transfer of more than twenty-five percent (25%) of the
ownership and/or control of any such joint venture partner,
taking all transfers into account on a cumulative basis.
3.4.2 Restrictions Prior to Completion. Prior to issuance of the
Certificate of Completion, Owner shall not Transfer this
Agreement or any of Owner's rights hereunder, or any
interest in the Site or in the improvements thereon, directly
or indirectly, voluntarily or by operation of law, except as
provided below, without the prior written approval of Agency,
and if so purported to be Transferred, the same shall be null
and void. In considering whether it will grant approval to any
Transfer by Owner of its interest in the Site before the
issuance of the Certificate of Completion, which Transfer
requires Agency approval, Agency shall consider factors
such as (i) whether the completion or implementation of the
Project is jeopardized; (ii) the financial strength and
capability of the proposed assignee to perform Owner's
obligations hereunder; and (iii) the proposed assignee's
experience and expertise in the planning, financing,
development, ownership, and operation of similar projects.
In the absence of specific written agreement by Agency,
prior to the issuance of a Certificate of Completion no
Transfer by Owner of all or any portion of its interest in the
Site or this Agreement (including without limitation an
assignment or transfer not requiring Agency approval
hereunder) shall be deemed to relieve it or any successor
party from any obligations under this Agreement with respect
to the completion of the development of the Project with
respect to that portion of the Site which is so transferred. In
addition, no attempted assignment of any of Owner's
obligations hereunder shall be effective unless and until the
successor party executes and delivers to Agency an
assumption agreement in a form approved by the Agency
assuming such obligations.
3.4.3 Exceptions. The foregoing prohibition shall not apply to any
of the following:
a. Any mortgage, deed of trust, or other form of
conveyance for financing, as provided in Section 513,
but Owner shall notify Agency in advance of any such
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mortgage, deed of trust, or other form of conveyance
for financing pertaining to the Site.
b. Any mortgage, deed of trust, or other form of
conveyance for restructuring or refinancing of any
amount of indebtedness described in subsection (a)
above, provided that the amount of indebtedness
incurred in the restructuring or refinancing does not
exceed the outstanding balance on the debt incurred
to finance the acquisition of and the construction of
the improvements on the Site, including any additional
costs for completion of construction, whether direct or
indirect, based upon the estimates of architects
and/or contractors.
C. The granting of easements to any appropriate
governmental agency or utility or permits to facilitate
the development of the Site.
d. A sale or transfer resulting from or in connection with
a reorganization as contemplated by the provisions of
the Internal Revenue Code of 1986, as amended or
otherwise, in which the ownership interests of a
corporation are assigned directly or by operation of
law to a person or persons, firm or corporation which
acquires the control of the voting capital stock of such
corporation or all or substantially all of the assets of
such corporation.
e. A sale or transfer of 49% or more of ownership or
control interest between members of the same
immediate family, or transfers to a trust, testamentary
or otherwise, in which the beneficiaries consist solely
of immediate family members of the Trustor or
transfers to a corporation or partnership in which the
immediate family members or shareholders of the
transferor have a controlling majority interest of 51%
or more.
f. A sale or transfer to a Qualified Tax Credit Investor;
provided that such Qualified Tax Credit Investor shall
be in a non-managing role.
g. Notwithstanding anything to the contrary contained in
this Agreement, Owner shall have the right, at its
option, to have the Site granted from Agency to a
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nonprofit general partner who is subsequently
admitted to the Owner.
h. A sale or transfer of general partner interests to a
nonprofit general partner.
4. DEVELOPMENT OF THE PROPERTY.
4.1 Except as set forth in this Agreement, before Owner begins constructing
the Improvements or undertakes any other work of improvement on the
Property, Owner, at its own cost and expense, will secure all land use and
other entitlements, permits, and approvals that Agency or any other
governmental agency with jurisdiction over the Project requires for
construction of the Project. Without waiver or limitation, Owner will secure
and pay all costs, charges and fees associated with, the following:
4.1.1 Permits. All permits and fees that the City, County of Riverside,
and other governmental agencies with jurisdiction over the Project,
the Improvements or the Property may require.
4.1.2 ADA/Barriers to the Disabled. The Project shall comply with all
applicable federal, state and local accessibility requirements. For
purposes of this Agreement the number of accessible dwelling units
shall be [zero (0)] unless a greater number of units shall be
required by law, whereupon such greater number of units shall
apply.
4.2 Basic Design. Owner has submitted a general or basic concept drawing
to Agency, which Agency has approved, and a copy of which is attached
as Exhibit "E" (the "Basic Design"). Owner will complete the
Improvements on the Property in one phase, according to the Basic
Design, and the plans, drawings, and documents that Owner submits to
Agency. Owner shall carry out construction of the Project including the
Improvements in accordance with all applicable local, state and federal
laws, codes, ordinances and regulations, including without limitation all
applicable state and federal labor standards.
4.3 Books and Records. Owner shall make available for examination at
reasonable intervals and during normal business hours, all books,
accounts, reports, files and other papers or property with respect to all
matters covered by this Agreement, and shall permit Agency to audit,
examine and make excerpts or transcripts from such records. Agency
may audit any conditions relating to this Agreement at Agency's expense,
unless such audit shows a materially significant discrepancy in information
reported by Owner to Agency in which case Owner shall bear the cost of
such audit. Owner shall also reasonably cooperate with and assist the
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Agency in Agency's compliance with any applicable audit requirements of
the California Redevelopment Law including California Health and Safety
Code Sections 33080 and 33080.1. This section shall survive for a period
of four years after the expiration or termination of this Agreement.
4.4 Audit. Owner shall be accountable to Agency for all Loan funds disbursed
to Owner pursuant to this Agreement. Owner will cooperate fully with
Agency and the State in connection with any interim or final audit relating
to the Project that may be performed. Owner will maintain accurate and
current books and records for the Project using generally accepted
accounting principles. Owner agrees to maintain books and records that
accurately and fully show the date, amount, purpose and payee of all
expenditures financed with Loan funds and to keep all invoices, receipts
and other documents related to expenditures financed with Loan funds for
not less than four (4) years after the fiscal year in which such expenditures
are incurred. For purposes of this section, "books, records and
documents" include, without limitation, plans, drawings, specifications,
ledgers, journals, statements, contracts/agreements, funding information,
purchase orders, invoices, loan documents, computer printouts,
correspondence, memoranda and electronically stored versions of the
foregoing. This section shall survive for a period of four years after the
expiration or termination of this Agreement.
4.5 Permits.
4.5.1 Project Completion. Agency, acting through and in the
discretion of its Director, may extend the completion date of the
Project for that period of time that Agency, in its reasonable
discretion, determines necessary to overcome any delay if and to
the extent such delay is due to a cause which is beyond Owner's
reasonable control, and if Owner could not, with reasonable
diligence, have foreseen and avoided such cause for delay. Such
causes include, without limitation, acts of God, unusually severe
weather or flood, war, terrorism, riot or act of the public enemy,
labor disputes, unavoidable inability to secure labor, materials,
supplies, tools or transportation, or acts or omissions of any
governmental authority having jurisdiction. Agency will not extend
the completion date for acts or omissions occurring through the
fault of Owner, or for acts of Agency permitted or contemplated by
this Agreement. An extension of time as provided in this
subsection will be Owner's sole remedy for any delays in the
Schedule of Performance the Project completion date.
As a condition precedent to any extension requested by Owner,
Owner will give the Agency notice within ten (10) days after any
cause for delay occurs, stating the cause and the additional time
19
Owner anticipates needed to complete the Project. Any extension
by Agency must be in writing and signed by the Director or the
Director's designee, which approval shall not be unreasonably
withheld, delayed or conditioned.
4.6 Subject to the terms of this Agreement, the Loan shall be disbursed to
Owner according to the Schedule of Performance. All Loan funds shall be
used solely for costs of the Project and Improvements.
4.7 Certificate of Completion. Owner will notify Agency when Owner deems
the Project complete. Within ten (10) business days after such notice,
Agency will inspect the Improvements. When Agency reasonably
determines Owner has completed the Improvements as required in this
Agreement, the Plan, and the Law, Agency will furnish Owner with the
Certificate of Completion. Agency will not unreasonably delay, condition
or refuse to issue the Certificate of Completion. The recorded Certificate
of Completion will be a conclusive determination that Owner has
satisfactorily completed the Improvements required under this Agreement.
Any parties then owning or subsequently purchasing, leasing or otherwise
acquiring any interest in the Property will not (because of that ownership,
purchase, lease or acquisition) after the recording, incur any obligation or
liability under this Agreement for constructing the Improvements, but will
take such interest in the Property subject to the continuing covenants set
forth in this Agreement.
4.7.1 If Agency determines not to furnish the Certificate of
Completion, in accordance with Section 4.7 above, Agency will give
Owner a written notice stating why Agency has decided not to issue
the Certificate of Completion, or why it is delaying the issuance,
and the reasonable actions that, in Agency's opinion, Owner must
take before Agency can issue the Certificate of Completion.
Agency's failure to give the notice within ten (10) days, however,
will not cause the Owner to be entitled to the Certificate of
Completion. The Certificate of Completion is not a notice of
completion as referred to in Section 3093 of the California Civil
Code.
4.7.2 The following are conditions precedent to Agency issuing
the Certificate of Completion, and each submission will be in form
and substance satisfactory to the Director: Evidence that the time
to file all mechanics' liens or material men's liens has expired and
any such liens recorded against the Property or Improvements
have been released or, if not released, sufficiently bonded (i.e.
150%) against as required by law.
20
4.8 To the extent economically feasible, consistent with the requirements of
any permitted encumbrance, or as otherwise approved by Agency or
provided in the Agreement, if any building or improvement on the Property
is damaged or destroyed by an insurable cause, Owner shall, at its cost
and expense, diligently undertake to repair or restore said buildings and
improvements consistent with the Basic Design for the Project. Such work
or repair shall commence within ninety (90) days after the insurance
proceeds are made available to Owner and shall be complete within one
(1) year thereafter. All insurance proceeds collected for such damage or
destruction shall be applied to the cost of such repairs or restoration and,
if such insurance proceeds shall be insufficient for such purpose, Owner
shall make up the deficiency.
4.9 Inspections. Owner shall permit, facilitate and require its contractors to
permit and facilitate observation and inspection of the Project by Agency
during reasonable business hours and upon reasonable notice for the
purpose of determining compliance with this Agreement.
4.10 If and to the extent that development of the Project results in the
permanent or temporary displacement of residential tenants, homeowners
or businesses, Owner shall comply with all applicable local, state (CRL)
and federal statutes and regulations with respect to relocation planning,
advisory assistance and payment of monetary benefits. Owner shall be
solely responsible for payment of any relocation benefits to any displaced
persons and any other obligations associated with complying with said
relocation laws.
4.11 Reporting Requirements. Owner shall submit to Agency the following
reports:
4.11.1 Annual Reports. Annually, beginning in the year following
Agency's issuance of the Certificate of Completion, and
continuing until the expiration of this Agreement, on such dates as
are agreeable between the parties and consistent with all federal
and state reporting requirements applicable to the Project, Owner
shall submit an annual report to Agency, in a form approved by
Agency. Such annual report shall include for each of the
Affordable Units: the rent, the annual income and the family size
of the Household occupying the Affordable Unit. Such annual
report shall also state the date the tenancy commenced for each
Affordable Unit, certification from an officer of Owner that the
Affordable Unit is in compliance with the Affordable Rental
Housing requirements, and such other information the Agency
may be required by Law to obtain. Owner shall provide any
additional information reasonably requested by the Agency
21
provided such information is directly related to Owner's
compliance with this Agreement.
4.11.2 Annual Proof of Insurance. Annually, beginning in the year
following Agency's issuance of the Certificate of Completion, and
continuing until the expiration of the Agreement, Owner shall
submit proof of insurance as required by this Agreement.
4.12 All Leases used to rent the Affordable Units are subject to the following:
4.12.1 Annual Income Certification and Reporting. Owner
shall include in leases for all Affordable Units provisions
which authorize Owner to immediately terminate the
tenancy of any Household one or more of whose
members misrepresented any fact material to the
Household's qualification as a Household for low- to
moderate-income family. Each such lease shall also
provide that the Household is subject to annual
certification, and that, if the Household's annual income
increases above the applicable limits for low to moderate
income family such Household's rent may be subject to
increase to the amount payable by tenant under federal,
state or local law, except that, consonant with the Law,
tenants of the Affordable Units that have been allocated to
low income housing tax credits by a housing credit agency
pursuant to section 42 of the Internal Revenue Code of
1986 (26 U.S.C. 42) must pay rent governed by Section
42.
4.12.2 The leases for the Affordable Units shall provide that
if the Project is subject to state or federal rules governing
low income housing tax credits, the provision of those
rules regarding continued occupancy by, and increases in
rent for, Households whose incomes exceed the eligible
income limitation shall apply in place of the provisions set
forth in subsection 4.11.1 above.
4.13 With respect to the Project, Owner shall comply with the following:
4.13.1 Except to any extent otherwise provided in this
Agreement, Owner is specifically responsible for all
management functions with respect to the Affordable
Units including, without limitation, the selection of tenants,
certification and re-certification of Household size and
income, evictions, collection of rents and deposits,
maintenance, landscaping, routine and extraordinary
22
repairs, replacement of capital items and security.
Agency shall have no responsibility for management of
the Affordable Units of the Project.
4.14 Owner covenants and agrees the Affordable Units shall constitute
Affordable Rental Housing during the entire Affordability Period. If Owner
fails to comply with the requirement to lease the Affordable Units only to
qualified Households during the Affordability period, Agency shall be
entitled to enjoin Owner from leasing the Affordable Units in the Project,
as Owner acknowledges that damages are not an adequate remedy at law
for such breach.
5. INDEMNITY; INSURANCE
5.1 Owner shall indemnify, hold harmless and defend Agency, City and each
of their officers, officials, employees, agents from any and all loss, liability,
fines, penalties, forfeitures, costs and damages (whether in contract, tort
or strict liability, including but not limited to personal injury, death at any
time and property damage) incurred by Agency, City, Owner, or any other
person, and from any and all claims, demands and actions in law or equity
(including attorney's fees and litigation expenses), arising or alleged to
have arisen directly or indirectly out of Owner's performance of this
Agreement. Owner's obligations under the preceding sentence shall not
apply to any loss, liability, fines, penalties, forfeitures, costs or damages
caused solely by the gross negligence, or caused by the willful
misconduct, of Agency, City or any of their officers, officials, employees,
agents or volunteers. This section shall survive expiration or termination
of this Agreement.
Throughout the life of this Agreement, the Owner shall pay for and
maintain in full force and effect all policy(ies) of insurance required
hereunder with (an) insurance company(ies) either (1) admitted by the
California Insurance Commissioner to do business in the State of
California and rated not less than "A-VII" in Best's Insurance Rating Guide,
or (2) authorized by the Agency's Risk Manager or his/her designee. The
following policies of insurance are required:
5.2.1 Until the Certificate of Completion is recorded,
Builders Risk (Course of Construction) insurance in an
amount equal to the completed value of the project with no
coinsurance penalty provisions.
5.2.2. Following the recording of the Certificate of
Completion, Fire and Extended Coverage Insurance against
loss or damage to the project by fire and lightning, with
23
extended coverage for vandalism and malicious mischief
and sprinkler system leakage. Such extended coverage
insurance will, as nearly as practicable, cover loss or
damage by explosion, windstorm, riot, aircraft, vehicle,
smoke and such other hazards as are normally covered by
such insurance. Such insurance shall be in an amount equal
to the replacement cost (without deduction for depreciation)
of the project with no coinsurance penalty provisions.
All policies of insurance required hereunder shall be endorsed to provide
that the coverage shall not be cancelled, non-renewed, reduced in
coverage or in limits except after 30 calendar day written notice has been
given to Agency. Upon issuance by the insurer, broker, or agent of a
notice of cancellation, non-renewal, or reduction in coverage or in limits,
Owner shall furnish Agency with a new certificate and applicable
endorsements for such policy(ies). In the event any policy is due to expire
during the term of this Agreement, Owner shall provide a new certificate,
and applicable endorsements, evidencing renewal of such policy not less
than 15 calendar days prior to the expiration date of the expiring policy.
The Builders Risk (Course of Construction) and Fire and Extended
Coverage insurance policies shall be endorsed to name Agency as a loss
payee.
Owner shall furnish Agency with all certificate(s) and applicable
endorsements effecting coverage required hereunder. All certificates
and applicable endorsements are to be received and approved by the
Agency's Risk Manager or his/her designee prior to Agency's execution of
this Agreement.
If at any time Owner fails to maintain the required insurance in full force
and effect, Owner shall immediately discontinue all work under this
Agreement until Agency receives notice that the required insurance has
been restored to full force and effect and that the premiums therefore have
been paid for a period satisfactory to the Agency. Owner's failure to
maintain any required insurance shall be sufficient cause for Agency to
terminate this Agreement.
The fact that insurance is obtained by Owner shall not be deemed to
release or diminish the liability of Owner, including, without limitation,
liability under the indemnity provisions of this Agreement. The duty to
indemnify Agency, City and each of their officials, officers, employees,
agents and volunteers shall apply to all claims and liability regardless of
whether any insurance policies are applicable. The policy limits do not act
as a limitation upon the amount of indemnification to be provided by
Owner. Approval or purchase of any insurance contracts or policies shall
in no way relieve from liability nor limit the liability of Owner.
24
Upon request of Agency, Owner shall immediately furnish Agency with a
complete copy of any insurance policy required under this Agreement,
including all endorsements, with said copy certified by the underwriter to
be a true and correct copy of the original policy. This requirement shall
survive expiration or termination of this Agreement.
5.3 Owner will obtain and deliver payment and performance bonds issued by
an insurance company admitted in California in good standing as a surety
and meeting the criteria for Owner's other insurance under this
Agreement, each bond in an amount at least equal to 100% of Owner's
estimated construction costs, provided that the Agency hereby waives any
requirement for said bonds at all time during which Owner is in full
compliance with this Agreement and the Project remains fully funded.
5.4 Until Agency issues the Certificate of Completion Agency will have access
to the Property, after reasonable notice to the Owner (except in
emergencies), without charge or fee, during normal construction hours, for
purposes of assuring compliance with this Agreement. Agency
representatives will comply with all safety rules while on the Project or the
Property.
5.5 Owner will design and construct the Improvements, and after that, prior to
any allowable transfer or sale thereof, Owner will maintain the Property
according to all applicable laws including, without limitation, all applicable
state labor standards, Agency zoning and development standards,
building, plumbing, mechanical and electrical codes, all provisions of the
Palm Springs Municipal Code and all applicable access requirements.
Agency makes no representation about which, if any, of such laws,
ordinances, regulations or standards apply to development of the Project.
Owner acknowledges that Owner, not Agency, is responsible for
determining applicability of and compliance with all local, state, and
federal laws including, but not limited to, any applicable provisions of the
California Labor Code, Public Contract Code, and Government Code.
Agency makes no express or implied representation as to the applicability
or inapplicability of any such laws to this Agreement or to the parties'
respective rights or obligations hereunder including, but not limited to,
payment of prevailing wages, competitive bidding, subcontractor listing, or
similar or different matters. Owner further acknowledges that Agency
shall not be liable or responsible at law or in equity for any failure by
Owner to comply with any such laws, regardless of whether Agency knew
or should have known of the need for such compliance, or whether
Agency failed to notify Owner of the need for such compliance.
5.6 Owner will take reasonable efforts to not permit any lien or stop notice to
be filed against the Property, provided Owner may reasonably determine
to contest any such lien or stop notice. If a claim of lien or stop notice is
25
recorded against the Property or Improvements, Owner, within 30 days
after recordation of a claim of lien or stop notice or within 5 days after
Agency's demand, whichever first occurs, will do the following:
5.6.1 Pay and discharge the same; or
5.6.2 Effect the release of such lien by recording and delivering to
Agency a surety bond in sufficient form and amount (i.e. 150%), or
otherwise; or
5.6.3 Give Agency other assurance which Agency, in its sole
discretion, deems satisfactory to protect the Agency from the effect
of the lien or bonded stop notice.
6. SECURITY FINANCING AND RIGHTS OF HOLDERS.
6.1 Notwithstanding any other provision of this Agreement, Owner may not
grant a security interest in the Property before the Agency issues and
records a Certificate of Completion, without the written consent of Agency,
provided that Agency hereby approves the recommended security interest
of Owner's financial institutions, including respective ective successors or
P
assigns, as described in the Financing Plan.
7. CONTINUING OWNER OBLIGATIONS
7.1 In its performance of this Agreement, Owner covenants by and for itself
and its successors and assigns, and all persons claiming under or through
them, that there shall be no discrimination against or segregation of any
person, including contractors, subcontractors, bidders and vendors, on
account of race, color, religion, ancestry, national origin, sex, sexual
preference, age, pregnancy, childbirth or related medical condition,
medical condition (e.g., cancer related) or physical or mental disability,
and in compliance with all applicable federal, state and local laws,
regulations and rules including without limitation Title VII of the Civil Rights
Act of 1964, 42 U.S.C. Section 2000, et seq., the Federal Equal Pay Act of
1963, 29 U.S.C. Section 206(d), the Age Discrimination in Employment
Act of 1967, 29 U.S.C. Section 621, et seq., the Immigration Reform and
Control Act of 1986, 8 U.S.C. Section 1324b, et seq., 42 U.S.C. Section
1981, the California Fair Employment and Housing Act, Cal. Government
Code Section 12900, et seq., the California Equal Pay Law, Cal. Labor
Code Section 1197.5, Cal. Government Code Section 11135, the
Americans with Disabilities Act, 42 U.S.C. Section 12101, et seq., and all
other applicable anti-discrimination laws and regulations of the United
States and the State of California as they now exist or may hereafter be
amended. Owner will allow Agency representatives access to its
employment records related to this Agreement during regular business
26
hours and upon reasonable notice to verify compliance with these
provisions when so requested by the Agency.
7.2 Owner will pay before delinquency all ad valorem real estate taxes and
assessments on the Property, subject to the Owner's right to contest in
good faith any such taxes. Owner will remove any levy or attachment on
the Property or any part of it, or assure the satisfaction of the levy or
attachment within a reasonable time. Owner will notify Agency prior to
applying for or receiving any exemption from the payment of property
taxes or assessments on any interest in or to the Property or the
Improvements. Owner further agrees that the prior consent of Agency
shall be required if the basis for such exemption is other than for qualified
property held by a nonprofit entity that has been determined to be exempt
from federal and state income taxation, which consent shall not be
unreasonably withheld.
8. COVENANTS AND RESTRICTIONS RUNNING WITH THE LAND. The
following covenants shall run with the land and shall bind Owner, and Owner's
successors in interest to the Property for the periods stated, and shall be fully
binding for the benefit of the Plan community and Agency without regard to
technical classification or designation, legal or otherwise.
8.1 Owner covenants for itself, its successors, assigns, and every successor
in interest to the Property or any part of it that, after closing of any
applicable escrow, during construction, and after completing the
Improvements, the Owner shall devote the Affordable Units on the
Property to the uses specified in this Agreement for the Affordability
Period. All uses of the Affordable Units including, without limitation, all
activities Owner undertakes pursuant to this Agreement, shall conform
with this Agreement and the Law. Without waiver or limitation, each of the
Affordable Units to be constructed pursuant to this Agreement shall be
maintained as Affordable Rental Housing pursuant to this Agreement and
the Restrictions.
8.2 Owner and those taking under Owner will maintain the Property and all
Improvements on site in reasonably good-condition and repair (and, as to
landscaping, if any, in a healthy condition), all according to the Basic
Design and related plans, as-amended from time to time. Owner and
those taking under Owner shall: (i) maintain all on-site Improvements
according to all other applicable laws, rules, ordinances, orders, and
regulations of all federal, state, county, municipal, and other governmental
agencies and bodies having or claiming jurisdiction and all their respective
departments, bureaus, and officials; (ii) keep the Improvements free from
graffiti, (iii) keep the Property free from any accumulation of debris or
waste material; (iv) promptly make repairs and replacements to the on-site
27
Improvements; and (v) promptly replace any dead, or diseased plants
and/or landscaping (if any) with comparable materials.
Agency will give Owner written notice of any breach of this Section 8.2.
Within 10 days from receipt of such notice, Agency and Owner will meet
and confer, and agree to corrective actions and a schedule of
performance for such corrective actions. Owner must cure the default
within the agreed schedule or within (a) 10 days after the Agency's notice
for any default involving landscaping, graffiti, debris, waste material, or
general maintenance on the Property, (b) 30 days after Agency's notice
for any default involving the Improvements. If Owner does not cure the
default within the agreed schedule, Agency, without obligation to, may
enter the Property, cure the default, and protect, maintain, and preserve
the Improvements and landscaping.
Agency may lien or assess the Property for the Agency's expenses in
protecting, maintaining, and preserving the on-site Improvements and
aesthetics of the Property, including any lawful administrative charge in
the manner used by the Agency in the abatement of public nuisances.
The notice and opportunity to cure provided for herein will substitute for
the noticing, hearing, and nuisance abatement order used by Agency.
Owner will promptly pay all such amounts to Agency upon demand.
8.3 During the Affordability Period Owner covenants to use and operate the
Affordable Units on the Property as Affordable Rental Housing pursuant to
this Agreement.
8.4 Owner covenants for itself and any successors in interest and all persons
claiming by, through or under them, in perpetuity, that there shall be no
discrimination against or segregation of any person or group of persons
because of race, color, creed, religion, sex, sexual preference, marital
status, national origin or ancestry in the sale, lease, sublease, transfer,
use, occupancy, tenure or enjoyment of the Affordable Units, nor shall
Owner itself or any person claiming under or through Owner establish or
permit any such practice or practices of discrimination or segregation
concerning the selection, location, number, use or occupancy of tenants,
lessees, subtenants, sublessees or vendees of the Affordable Units.
8.5 All deeds, leases, or contracts concerning the Affordable Units shall
contain or be subject to substantially the following nondiscrimination or
nonsegregation clauses:
In deeds: "The grantee herein covenants by and for himself or
herself, his or her heirs, executors, administrators and assigns, and
all persons claiming under or through them, that there shall be no
discrimination against or segregation of, any person or group of
28
persons because of race, color, creed, religion, sex, sexual
preference, marital status, national origin or ancestry in the sale,
lease, sublease, transfer, use, occupancy, tenure or enjoyment of
the land herein conveyed, nor shall the grantee or any person
claiming under or through him or her, establish or permit any such
practice or practices of discrimination or segregation concerning the
selection, location, number, use or occupancy of tenants, lessees,
subtenants, sublessees or vendees in the land herein, conveyed.
The foregoing covenants shall run with the land."
In leases: "The lessee herein covenants by and for himself or
herself, his or her heirs, executors, administrators, and assigns,
and all persons claiming under or through him or her, 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, because of race, color,
creed, religion, sex, sexual preference, marital status,
national origin, or ancestry in the leasing, subleasing,
transferring, use, occupancy, tenure, or enjoyment of the
premises herein leased nor shall the lessee himself or
herself, or any person claiming under or through him or her,
establish or permit any such practice or practices of
discrimination or segregation concerning the selection,
location, number, use, or occupancy of tenants, lessees,
sublessees, subtenants, or vendees in the premises herein
leased."
In contracts: "There shall be no discrimination against or
segregation of, any person, or group of persons because of race,
color, creed, religion, sex, sexual preference, marital status,
national origin, or ancestry, in the sale, lease, sublease, transfer,
use, occupancy, tenure or enjoyment of the premises, nor shall the
transferee himself or herself or any person claiming under or
through him or her, establish or permit any such practice or
practices of discrimination or segregation concerning the selection,
location, number, use or occupancy of tenants, lessees,
subtenants. sublessees or vendees of the premises."
8.6 Agency is the beneficiary of the covenants running with the land for itself
and for protecting the interests of the community and other parties, public
or private, in whose favor and for whose benefit the covenants are
provided, without regard to whether Agency has been, remains, or is an
owner of any land or interest in the Affordable Units on the Property.
Agency may exercise all rights and remedies, and maintain any actions or
29
suits at law or in equity or other proceedings to enforce the covenants for
itself or any other beneficiaries.
9. DEFAULTS AND REMEDIES
9.1 Subject to the extensions of time permitted under this Agreement, either
party's failure to perform any material action or material covenant as
required by this Agreement, following notice and failure to cure, is a
"Default" under this Agreement. A party claiming a Default shall give
written notice of Default to the other party specifying the Default
complained of, and the cure demanded. Except as otherwise expressly
provided in this Agreement, the noticing party shall not begin any
proceeding against the other party until the other party is given an
opportunity to cure the Default. The other party will have 30 calendar
days after receiving the notice to cure the Default, or, if the party cannot
reasonably cure the Default within such 30 days, the other party must
begin to cure within the 30 days and diligently pursue the cure to
completion, whereupon there shall be no event of Default.
9.2 Subject to first giving the notice and opportunity to cure, a party may begin
an action at law to enforce, or in equity to seek specific performance of,
the terms of this Agreement, or to cure, correct, or remedy any Default, to
recover damages for any Default, or to obtain any other remedy consistent
with the purpose of this Agreement. A party must bring any legal action in
the Superior Court of the County of Riverside, State of California, or in the
District of the United States District Court serving Riverside County.
9.3 If Owner begins any legal action against Agency, it shall serve process on
the Agency by personal service on the Director, or in any other manner
the law permits. If Agency begins any legal action against the Owner, it
will serve process on the Owner by personal service on Owner, Owner's
Agent or in any other manner the law permits.
9.4 Except as otherwise expressly stated in this Agreement, the rights and
remedies of the parties are cumulative, and a party's exercise of one or
more rights or remedies will not preclude the party's exercise, at the same
or different times, of any other rights or remedies for the same or any
other Default of the other party.
9.5 A party's failure or delay in asserting any right or remedy will not be a
waiver of any Default or of any right or remedy, and will not deprive the
party of its right to begin and maintain any action or proceeding to protect,
assert or enforce any right or remedy.
30
9.6 The laws of the State of California shall govern the interpretation and
enforcement of this Agreement.
10. GENERAL PROVISIONS
10.1 Any notice, demand, or other communication permitted or required under
this Agreement will be in writing and given by personal delivery, or by first-
class U.S. mail, postage prepaid, to a party at its respective address
below:
To Agency:
Executive Director
Community Redevelopment Agency of the City of Palm Springs
3200 Tahquitz Canyon Way
P.O. Box 2743
Palm Springs, CA 92263
Attention: Executive Director
With a Copy to:
WOODRUFF, SPRADLIN & SMART, APC
555 Anton Boulevard, Suite 1200
Costa Mesa, California 92626
Attention: Douglas C. Holland, Esq.
To Owner:
PS Housing Investors, LP
Global Premier Development, Inc., Administrative General Partner
2010 Main St. Suite 1250
Irvine, Ca. 92614
Andrew Hanna, President
A party may change its address for notices, demands and
communications by giving notice of the new address as provided in this
section. Any written notice, demand or communication shall be deemed
received immediately if delivered personally, and shall be deemed
received on the third day after it is postmarked if delivered by regular,
registered or certified mail, or on the date of receipt, if return receipt is
requested and available to confirm the date.
10.2 All of the terms, covenants and conditions of this Agreement shall be
binding upon the Owner and its permitted successors and assigns.
Whenever the term "Owner" is used in this Agreement, such term shall
include Owner's successors and assigns as permitted under this
Agreement.
31
10.3 The Agency may assign or transfer any of its interests, rights, or
obligations hereunder at any time to any public agency without the
consent of the Owner.
10.4 No member, official or employee of the Agency shall be personally liable
to the Owner, or any successor in interest to Owner, for any Default or
breach by the Agency.
10.5 The relationship between the Agency and the Owner is that of
redevelopment agency and redeveloper respectively, as permitted by law,
and not that of a partnership or joint venture. Agency and Owner shall not
be deemed or construed for any purpose to be the agent of the other.
10.6 Whenever this Agreement references an action or approval required or
permitted by the Agency, the Director or his or her designee is authorized
to act for the Agency as agent of the Agency unless this Agreement, the
Law, Constitutional and/or local law provide otherwise, or the context
otherwise requires.
10.7 This Agreement may be signed in multiple counterparts which, when
signed by all parties, will be one binding agreement. The parties will sign
three copies of this Agreement, each of which is deemed to be original.
10.8 This Agreement, includes the exhibits and attachments referenced and
incorporated in it. This Agreement contains the entire agreement between
the parties relating to the transaction contemplated by this Agreement and
supersedes all prior or contemporaneous agreements, understanding,
representation and statements, whether oral or written.
10.9 If either party begins a lawsuit or arbitration proceeding, in law or equity, to
enforce or interpret any provision of this Agreement, the prevailing party
will be entitled to recover from the other party reasonable attorneys' fees,
court costs, and legal expenses as determined by the court or tribunal
having jurisdiction.
10.10 Any waiver, alteration, change or modification of or to this Agreement, to
be effective, must be in writing, and signed by each party.
10.11 If any term, provision, condition or covenant of this Agreement or its
application to any party or circumstances is held invalid or unenforceable,
the remainder of this Agreement and its application to persons or
circumstances, other than those about whom or which it is held invalid or
unenforceable, shall not be affected, and shall remain valid and
enforceable to the fullest extent permitted by law.
32
10.12 Each party represents and warrants to the other that (a) each has read
this Agreement, and (b) is signing this Agreement with full knowledge of
any rights and obligations each may have, and (c) each has received
independent legal advice from their respective legal counsel as to the
matters set forth in this Agreement, or has knowingly chosen not to
consult legal counsel, and (d) has signed this Agreement without relying
on any agreement, promise, statement or representation by or for the
other party, or their respective agents, employees, or attorneys, except as
specifically set forth in this Agreement, and without duress or coercion,
whether economic or otherwise.
10.13 No member, official or employee of Agency has or shall have any personal
interest, direct or indirect, in this Agreement, nor shall any such member,
official or employee participate in any decision relating to the Agreement
which affects his personal interests or the interests of any corporation,
partnership or association in which he is directly or indirectly interested.
Owner represents and warrants that it has not paid or given, and will not
pay or give, to any third party any money or other consideration for
obtaining this Agreement, other than normal costs of conducting business
and costs of professional services such as architects, consultants,
engineers and attorneys.
10.14 The parties will execute such other and further documents, and will take
any other steps, necessary, helpful, or appropriate to carry out the
provisions of this Agreement.
10.15 No contractor, subcontractor, mechanic, material man, laborer, vendor, or
other person hired or retained by with Owner shall be, nor shall any of
them be deemed to be, third-party beneficiaries of this Agreement, rather
each such person shall be deemed to have agreed (a) that they shall look
to Owner as their sole source of recovery if not paid, and (b) except as
otherwise agreed to by Agency and any such person in writing, they may
not enter any claim or bring any such action against Agency under any
circumstances. Except as provided by law, or as otherwise agreed to in
writing between Agency and such person, each such person shall be
deemed to have waived in writing all right to seek redress from Agency
under any circumstances whatsoever.
10.16 Owner hereby covenants and warrants that it is a duly authorized and
existing California limited liability company, in good standing; that it shall
remain in good standing; that it has the full right, power and authority to
enter into this Agreement and to carry out all actions on its part
contemplated by this Agreement; that the execution and delivery of this
Agreement were duly authorized by proper action of the Owner and no
consent, authorization or approval of any person is necessary in
connection with such execution and delivery or to carry out all actions of
33
the Owner's part contemplated by this Agreement, except as have been
obtained and are in full force and effect; and that this Agreement
constitutes the valid, binding and enforceable obligation of the Owner.
10.17 In the event of any conflict between the body of this Agreement and any
exhibit or attachment to it, the terms and conditions of the body of this
Agreement will control.
111
111
111
34
IN WITNESS WHEREOF, Agency and Owner have signed this Agreement on
the respective dates set forth below.
"Agency"
Dated: ZO► Community Redevelopment Agency of
the City of Palm Springs, a public body,
corporate and politic
By'
David Ready, a Ive Director AeVLZ�
APPROV 4TF ORW} : ATTEST:
By: B .
D ugl s Holland ames Thompson
Agency Counsel 44gency Secretary
"Owner"
APPROVED BY CITY COUNCIL
5 I Rol PS Housing Investors, LP, a California
Limited Partnership by Global Premier
Development, Inc., i Administrative
General Partne
Dated: S ! )I By
NDRc'`� "t-}q
itsp p-e7l +
Dated: 9b //( By
Tt �NoATo,.�
Y: 5eAQ
Itsi^'2�sx27t'Nj$ C �o
(Two notarized signatures by Owner are required.)
35
CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
State of California 1
County of oack X e-
Il
On 813d before me, GiI
Date � LOygVCt�1 nir�R2.� P"I&LAC_
Date Here Insert Name entl Te e M the Ofewr
personally appeared ArJ AD 'r-c=,
Names)of Slgner(s) - -
who proved to me on the basis of satisfactory evidence to
be the person(s) whose name(s) iso subscribed to the
within instrument and acknowledged to me that
he/shelf S�executed the same in his/her/tD authorized
GINA ELOUAYEN capacity(ies), and that by his/hers��q si natures on the
Commission i 1905851 'N7" g ( )
z instrument the person(s), or the entity upon behalf of
NotaryLa Public •California z
Orange County which the person(s) acted, executed the instrument.
My Comm. Expires Sep 27,2014
certify under PENALTY OF PERJURY under the laws
of the State of California that the foregoing paragraph is
true and correct.
WITNESS my hand and official seal.
Place Note,Seal Above Signature _
Signature of a 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(s)
Signer's Name:_ Signer's Name:
71 Individual ❑ Individual
Corporate Officer—Title(s): ❑ Corporate Officer—Title(s):
Partner—G Limited D General _ 0 Partner—El Limited El General _
J Attorney in Fact • ❑❑Trustee Attorney in Fact
Trustee Tap of thumb here Top or Thumb here
Guardian or Conservator ❑Guardian or Conservator I
Other _ ❑Other:
Signer is Representing: Signer Is Representing:
I
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ACKNOWLEDGMENT OF INSTRUMENT
(Cal. Civil Code Section 1181)
State of California )
County of Riverside ) ss
City of Palm Springs)
On August 4, 2011, before me, JAMES THOMPSON, CITY CLERK, CITY OF
PALM SPRINGS CALIFORNIA, personally appeared DAVID H. READY, who I
personally know is the CITY MANAGER of the CITY OF PALM SPRINGS, and the
EXECUTIVE DIRECTOR of the CITY OF PALM SPRINGS COMMUNITY
REDEVELOPMENT AGENCY whose name is subscribed to the within instrument and
that he executed the same in his official and authorized capacity on behalf of the City of
Palm Springs, a California Charter City and the City of Palm Springs Community
Redevelopment Agency.
I certify under PENALTY OF PERJURY under the laws of the State of California
that the foregoing paragraph is true and correct.
Witness my hand and the official seal of the City of Palm Springs, California, this
4th day of August, 2011:
♦��F plM SpP '
iy
a
Y N
�wbuno'' •
' r441FOIt
Signature:
AMES THOMPSON, CITY CLERK
461 City of Palm Springs, California
Title or Type of Document: 6WNe�ie— �aRa 1 c PA.71or1 pw,�►�
Document Date: QM06/to ff Number of Pages: 71
iNu.cDre�b THIS ^"
Attachments:
Exhibit A: Legal Description of Property
Exhibit A-1: Location Map of the Property
Exhibit B: Schedule of Performance/Payment Schedule
Exhibit C: Budget/Financial Plan
Exhibit D: Certificate of Completion
Exhibit E: Basic Design
Exhibit F: Affordability Restrictions Running with Land.
Exhibit G: Specimen Promissory Note
Exhibit H: Specimen Deed of Trust and Assignment of Rents
36
EXHIBIT "A"
LEGAL DESCRIPTION OF PROPERTY
All that certain real property situated in the City of Palm Springs, County of Riverside,
State of California, described as follows:
Parcel A:
Lots 33 and 34 of Palm Springs Estates No. 3, in the City of Palm Springs, County of Riverside,
State of California, as per map recorded in Book 17, Page 34, of Maps, in the Office of the County
Recorder of said County.
Except the East 4.50 feet.
Also Except the right to any deposit of oil, gas or other hydrocarbon substances underlying said
land, as reserved by California Trust Company, a Corporation, in deed recorded February 28, 1929
in Book 601, Page 81 of Deeds, records of Riverside County, California.
Parcel B:
Lots 35 and 36 of Palm Springs Estates No. 3, in the City of Palm Springs, County of Riverside,
State of California, as per map recorded in Book 17, Page 34, of Maps, in the Office of the County
Recorder of sald County.
Excepting therefrom that portion conveyed to the City of Palm Springs by Deed recorded April 22,
1953 in Book 2258, Page 431 of Official Records of Riverside County, California.
Also Excepting the right to any deposit of oil, gas or other hydrocarbon substances underlying said
land, as reserved by California Trust Company, a Corporation, In deeds recorded March 29, 1932 in
Book 70, Page 304 of Official Records of Riverside County, California, as to said Lot 1, and recorded
February 28, 1929 in Book 302, Page 4 of Deeds, records of Riverside County, California, as to said
Lots 3S and 36,
Parcel C:
Lot 32 of Palm Springs Estates No. 3, in the City of Palm Springs, County of Riverside, State of
California, as per map recorded in Book 17, Page 34, of Maps, in the Office of the County Recorder
of said County.
Except the right to any deposit of oil, gas or other hydrocarbon substances underlying said land, as
reserved by California Trust Company, in deed recorded February 19, 1929 in Book 798, Page 465
of Deeds, records of Riverside County, California.
Assessor's Parcel Nos. 505-184-019, 020, 027
37
EXHIBIT "A-1"
LOCATION MAP OF THE PROPERTY
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38
EXHIBIT "B"
SCHEDULE OF PERFORMANCE
Items Completed Estimated Date
Agency approves Agreement at a public meeting June 15, 2011
Owners submits application to the California Tax Credit Allocation July 14, 2011
Committee for 9% Low Income Housing Tax Credits
Owner executes and delivers Agreement to Agency July 25, 2011
Agency executes Agreement, requests funds to be drawn for close of land August 1, 2011
escrow
City deposits the $500,000 and $1,000,000 Loan commitments into August 4, 2011
escrow under the Agreement, as well as executed Agreement
Owner deposits executed Deed of Trust into escrow August 4, 2011
Close of Escrow. Owner closes escrow on the Property purchase from August 5, 2011
Seller. Escrow Agent shall record Agreement, Deed of Trust and other
related documents with the Riverside County Recorder.
Submission —Certificates of Insurance. Owner furnishes to Agency August 15, 2011.
appropriate certificates of bodily injury and property damage insurance
policies.
Approval — Certificates of Insurance. Agency approves or disapproves August 30, 2011.
Owner's submission of appropriate certificates of bodily injury and
property damage insurance policies.
Tax Credit Allocation. Owner receives notice of tax credit allocation from September 29, 2011
TCAC.
Construction Loan/Tax Credit Eguity Closing. Owner closes on Tax Credit December 1, 2011
Equity and construction loan; admits Qualified Tax Credit Investor to
partnership.
Commencement of Construction of Owner's Improvements Owner shall December 1, 2011
complete construction of the improvements to be constructed on the
Project Site.
Completion of Construction of Owner's Improvements The Owner shall April 1, 2012
complete construction of the improvements to be constructed on the
Project Site.
Permanent loan conversion. Owner, Qualified Tax Credit Investor, lender July 1, 2012
close escrow on conversion of construction loan to permanent debt.
Issuance — Certificate of Completion. The Agency shall furnish the Owner July 15, 2012
with a Certificate of Completion on the Project.
39
EXHIBIT "C"
Budget/Financial Plan
PROJECI FEASJML SUMMARY14%V4 Creel BOILS
SIMSET PALM SENIOR APARTMENTS
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40
EXHIBIT "D"
Certificate of Completion
CERTIFICATE OF COMPLETION
RECORDED AT THE REQUEST OF
AND WHEN RECORDED RETURN TO:
Community Redevelopment Agency of City of Palm Springs
3200 Tahquitz Canyon Way
P.O. Box 2743
Palm Springs, CA 92263
Attention: Executive Director
SPACE ABOVE THIS LINE FOR RECORDER'S USE)
This Certificate of Completion is recorded at the request and for the benefit of the
Community Redevelopment Agency of the City of Palm Springs and is exempt from the
payment of a recording fee pursuant to Government Code Section 6103.
Community Redevelopment Agency of the City
of Palm Springs, a public body, corporate and
politic
By:
David H. Ready, Esq., Ph.D.
Its: Executive Director
Dated:
42
Certificate of Completion
RECITALS :
A. By an Owner Participation Agreement (the "Agreement") dated
[ 1, 2011 between PS Housing Investors, LP., a California Limited
Partnership ("Owner") and the Community Redevelopment Agency of the City of Palm
Springs, a public body corporate and politic ("Agency"), Owner agreed to rehabilitate
certain residential units on the premises legally described in Attachment "A" hereto (the
"Property") and preserve the Affordable Units, as defined in the Agreement as rental
housing for Low-Income Households with the assistance of Agency housing set aside
funds while meeting the Affordable Housing, income targeting and other requirements of
the Community Redevelopment Law set forth at California Health and Safety Code
Sections 33000 et seq. for a fifty-five (55) year Affordability Period according to the
terms and conditions of the Agreement.
B. The Agreement was recorded on [ 1 , 2011 in the Official
Records of Riverside County, California as Instrument No.
C. Under the terms of the Agreement, after Owner completes the construction on
the Property, Owner may ask Agency to record a Certificate of Completion.
D. Owner has asked Agency to furnish Owner with a recordable Certificate of
Completion.
E. Agency's issuance of this Certificate of Completion is conclusive evidence that
Owner has completed the construction on the Property as set forth in the Agreement.
NOW THEREFORE:
1. Agency certifies that Owner commenced the construction work on the
Project on [ 1, 20_, and completed the construction
work on the Project on 20_, and has done so in full compliance
with the Agreement.
43
2. This Certificate of Completion is not evidence of Owner's compliance with
P p ,
or satisfaction of, any obligation to any mortgage or security interest holder, or any
mortgage or security interest insurer, securing money lent to finance work on the
Property or Project, or any part of the Property or Project.
3. This Certificate of Completion is not a notice of completion as referred to
in California Civil Code section 3093.
4. Nothing contained herein modifies any provision of the Agreement.
IN WITNESS WHEREOF, the Agency has executed this Certificate of
Completion as of this_ day of 20
Community Redevelopment Agency
of the City of Palm Springs, a public body,
corporate and politic
By:
David H. Ready, Esq., Ph.D.
Executive Director
44
Owner hereby consents to recording this Certificate of Completion against the
Property described herein.
Dated: 2012
PS Housing Investors, LP, by
Global Premier Development, Inc., its Administrative General Partner
By:
Andrew Hanna,President
Global Premier Development, Inc.
THE ABOVE PARTIES ARE TO SIGN THIS INSTRUMENT BEFORE A NOTARY
PUBLIC.
ATTEST: APPROVED AS TO FORM:
CITY CLERK CITY ATTORNEY
By: By:
Dated: Dated:
45
EXHIBIT A
LEGAL DESCRIPTION
All that certain real property situated in the City of Palm Springs, County of Riverside,
State of California, described as follows:
Parcel A:
Lots 33 and 34 of Palm Springs Estates No. 3, in the City of Palm Springs, County of Riverside,
State of California, as per map recorded In Book 17, Page 34,of Maps, in the Office of the County
Recorder of said County.
Except the East 4.SO feet.
Also Except the right to any deposit of oil, gas or other hydrocarbon substances underlying said
land, as reserved by California Trust Company, a Corporation, In deed recorded February 28, 1929
in Book 801, Page 81 of Deeds, records of Riverside County, California.
Parcel 8:
Lots 35 and 36 of Palm Springs Estates No. 3, in the City of palm Springs, County of Riverside,
State of California, as per map recorded in Book 17, Page 34, of Maps, in the Office of the County
Recorder of said County.
Excepting therefrom that portion conveyed to the City of Palm Springs by Deed recorded April 22,
1953 in Book 2258, Page 431 of Official Records of Riverside County, California.
Also Excepting the right to any deposit of oil, gas or other hydrocarbon substances underlying said
land, as reserved by California Trust Company, a Corporation,in deeds recorded March 29, 1932 in
Book 70, Page 394 of Official Records of Riverside County, California, as to said Lot 1, and recorded
February 28, 1929 In Book 302, Page 4 of Deeds, records of Riverside County, California, as to said
Lots 35 and 36.
Parcel C:
Lot 32 of Palm Springs Estates No. 3, in the City of Palm Springs, County of Riverside, State of
California, as per map recorded in Book 17, Page 34,of Maps, In the Office of the County Recorder
of said County.
Except the right to any deposit of oil, gas or other hydrocarbon substances underlying said land, as
reserved by Califomia Trust Company, in deed recorded February 19, 1929 in Book 798, Page 465
of Deeds, records of Riverside County, California.
Assessor's Parcel Nos. 505-184-019, 020, 027
46
EXHIBIT "E"
SCOPE OF DEVELOPMENT
BASIC DESIGN/EXTERIOR PLANS (All plans included by reference)
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52
EXHIBIT "F"
REGULATORY AGREEMENT AND
DECLARATION OF COVENANTS AND RESTRICTIONS
FREE RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
COMMUNITY REDEVELOPMENT AGENCY
OF THE CITY OF PALM SPRINGS
3200 Tahquitz Canyon Way, P.O. Box 2743
Palm Springs, CA 92263
Attn: Executive Director
(Space Above This Line for Recorders Office Use Only)
REGULATORY AGREEMENT AND
DECLARATION OF COVENANTS AND RESTRICTIONS
THIS REGULATORY AGREEMENT AND DECLARATION OF COVENANTS
AND RESTRICTIONS ("Agreement") is made and entered into this day of
, by and between the Community Redevelopment Agency of
THE CITY OF PALM SPRINGS, a public body, corporate and politic ("Agency"), and PS
HOUSING INVESTORS, LP, a California Limited Partnership ("Owner").
RECITALS:
A. Pursuant to an Owner Participation Agreement by and between Agency
and Owner dated , 2011 (the "OPA"), Agency has provided to
Owner financial assistance in the amount of approximately One Million Dollars
($1,000,000.00) in loan funds (the "Agency Assistance"), for the purpose of assisting
Owner in the acquisition of real property and the rehabilitation of a mixed use residential
apartment complex thereon wherein twenty percent of the units shall be rented to low
income households and eighty percent of the units shall be rented to moderate income
households, on that certain real property located in the City of Palm Springs, County of
Riverside, State of California, more particularly described in Exhibit "A" attached hereto
and incorporated herein by reference (the "Site").
B. Pursuant to the OPA, Owner has agreed to rehabilitate and maintain a
rental apartment housing project consisting of twenty four (24) total residential units
(hereinafter referred to collectively as the "Project') on the Site. The Project is also
53
referred to in the OPA as the "Project," and is further described in the Scope of
Development attached to the OPA.
C. The Agency and the City of Palm Springs have fee or easement interests
in various streets, sidewalks and other property within the City and are responsible for
the planning and development of land within the City in such a manner so as to provide
for the health, safety and welfare of the residents of the City. That portion of the
Agency's and City's interest in real property most directly affected by this Agreement is
depicted in Exhibit "B" attached hereto and incorporated herein by reference ("Public
Parcel").
D. Agency, City, and Owner now desire to place restrictions upon the use
and operation of the Project, in order to ensure that the Project shall be operated
continuously as a rental apartment housing project with the units available for rental by
low income persons for the term of this Agreement.
AGREEMENT:
NOW, THEREFORE, the Owner and Agency declare, covenant and agree, by
and for themselves, their heirs, executors, administrators and assigns, and all persons
claiming under or through them, that the Site shall be held, transferred, encumbered,
used, sold, conveyed, leased and occupied, subject to the covenants and restrictions
hereinafter set forth, all of which are declared to be in furtherance of a common plan for
the improvement and sale of the Site, and are established expressly and exclusively for
the use and benefit of the Agency, the residents of the City of Palm Springs, and every
person renting a dwelling unit on the Site.
AFFORDABILITY RESTRICTIONS RUNNING WITH LAND
In addition to the covenants and conditions contained in the Agreement, the
following California Community Redevelopment Law (California Health & Safety Code
Section 33000 et seq.) affordability requirements shall be imposed upon the 24
Affordable Units on the Property funded under the Agreement and shall bind the Owner
and all purchasers of the Property and their successors for a fifty-five (55) year period.
The Affordable Units on the Property are held and will be held, transferred,
encumbered, used, sold, conveyed and occupied subject to the covenants, restrictions,
and limitations set forth in this Exhibit, all of which are in furtherance of the Project, the
Agency's Community Redevelopment Law and Plan Area obligations including
54
Agency's obligations set forth at California Health & Safety Code sections 33334.2 et
seq and 33413 (a) with respect to Housing Set Aside Funds and replacement dwelling
units at affordable rent within the jurisdiction of the Agency. All of the restrictions,
covenants and limitations will run with the land and will be binding on all parties having
or acquiring any right, title or interest in the Affordable Units upon the Property or any
part thereof, will inure to the benefit of the Agency, and will be enforceable by it. Any
purchaser under a contract of sale or other transferee of an interest covering any right,
title or interest in any part of the Affordable Units upon the Property, by accepting a
deed or a contract of sale or agreement of purchase, accepts the document subject to,
and agrees to be bound by, any and all restrictions, covenants, and limitations set forth
in this Exhibit for the period of fifty-five (55) years running from and after recordation of
Agency's Certificate of Completion constituting the Affordability Period.
1. Restrictions. The following covenants and restrictions ("Restrictions") on the use
and enjoyment of the Affordable Units upon the Property shall be in addition to any
other covenants and restrictions affecting the Property, and all such covenants and
restrictions are for the benefit and protection of the Agency and shall run with the
Affordable Units upon the Property and be binding on any future owners of the Property
and inure to the benefit of and be enforceable by Agency. These covenants and
restrictions are as follows:
a. From the date of recordation of Agency's Certificate of Completion until
the expiration of the Affordability Period the twenty four (24) Affordable Units funded
under the Agreement are to be used as Low Income Affordable Rental Housing as
provided for in the Agreement. Owner agrees to file a recordable document setting forth
the project Completion Date and the Affordability Period as and when determined by the
Agency. Unless otherwise provided in the Agreement, the term "Affordable Rental
Housing" shall include without limitation compliance with the following requirements:
Nondiscrimination. There shall be no discrimination against nor
segregation of any person or group of persons on account of race, color,
creed, religion, sex, marital status, national origin, ancestry, or handicap in
the sale, transfer, use, occupancy, tenure, or enjoyment of any of the
Property, nor shall Owner or any person claiming under the Owner,
establish or permit any practice of discrimination or segregation with
reference to the selection, location, number, use or occupancy of owners
or vendees of the Property.
55
Principal Residence. Each of the Affordable Units upon the Property shall
be leased only to natural persons, who shall occupy such as a principal
residence.
Income Requirements. Each of the 24 Units constituting Low Income
Affordable Rental Housing upon the Property may be leased only to (a)
natural person(s) whose annual household income at the time of initial
occupancy is not greater than sixty percent (60%) of the most recent
annual median income calculated and published by HUD for the
Riverside-San Bernardino Metropolitan Statistical Area applicable to such
household's size, and at an affordable price consistent with the applicable
California Redevelopment Law.
Inounctive Relief and Recapture. Should any of the 24 Affordable Units
constituting Low Income Affordable Rental Housing upon the Property not
continue to be, at the time of initial occupancy, the principal residence of a
Household that qualifies as a low-income household, during the period of
Affordability, such Unit(s) shall be made available for subsequent lease
only to Households that qualify as a very low-income for use as the
Household's principal residence.
2. Enforcement of Restrictions. Without waiver or limitation, the Agency shall be
entitled to injunctive or other equitable relief against any violation or attempted violation
of the Restrictions, and shall, in addition, be entitled to damages for any injuries or
losses resulting from any violations thereof.
3. Acceptance and Ratification. All present and future owners of the Property and
other persons claiming by, through, or under them shall be subject to and shall comply
with the above Restrictions. The acceptance of a deed of conveyance to the Property
shall constitute an agreement that the Restrictions, as such may be amended or
supplemented from time to time, is accepted and ratified by such future owners, tenant
or occupant, and such Restrictions shall be a covenant running with the land and shall
bind any person having at any time any interest or estate in the Property, all as though
such Restrictions were recited and stipulated at length in each and every deed,
conveyance, mortgage or lease thereof.
4. Benefit. This Exhibit and the Restrictions therein shall run with and bind the
Property for a term commencing on the date the Agreement to which this Exhibit is
attached is recorded in the Office of the Recorder of the County of Riverside, State of
56
California, and expiring upon the expiration of the Affordability Period. The failure or
delay at any time of Agency and/or any other person entitled to enforce these
Restrictions shall in no event be deemed a waiver of the same, or of the right to enforce
the same at any time or from time to time thereafter, or an estoppel against the
enforcement thereof.
5. Costs and Attorney's Fees. In any proceeding arising because of failure of
Owner or any future owner of the Property to comply with the Restrictions required by
this Exhibit, as may be amended from time to time, Agency shall be entitled to recover
its respective costs and reasonable attorney's fees incurred in connection with such
default or failure.
6. Waiver. Neither Owner nor any future owner of the Property may exempt itself
from liability for failure to comply with the Restrictions required in this Exhibit.
7. Severability. The invalidity of the Restrictions or any other covenant, restriction,
condition, limitation, or other provision of this Exhibit shall not impair or affect in any
manner the validity, enforceability, or effect of the rest of this Exhibit and each shall be
enforceable to the greatest extent permitted by law.
8. Pronouns. Any reference in this Exhibit and the Restrictions therein to the
masculine, feminine, or neuter gender herein shall, unless the context clearly requires
the contrary, be deemed to refer to and include all genders. Words in the singular shall
include and refer to the plural, and vice versa, as appropriate.
9.. Interpretation. The captions and titles of the various articles, sections,
subsections, paragraphs, and subparagraphs of this Exhibit are inserted herein for
ease and convenience of reference only and shall not be used as an aid in interpreting
or construing this Exhibit or any provision hereof.
10.. Capitalized Terms. All capitalized terms used in this Exhibit, unless otherwise
defined herein, shall have the meanings assigned to such terms in the Agreement.
11. Amendments. This Agreement shall be amended only by a written instrument
executed by the parties hereto or their successors in title, and duly recorded in the real
property records of the County of Riverside.
12. Notice. Any notice required to be given hereunder shall be made in writing and
shall be given by personal delivery, certified or registered mail, postage prepaid, return
57
receipt requested, at the addresses specified below, or at such other addresses as may
be specified in writing by the parties hereto:
Agency: Community Redevelopment Agency
of the City of Palm Springs
3200 Tahquitz Canyon Way
P.O. Box 2743
Palm Springs, CA 92263
Attn: Executive Director
Copy to: WOODRUFF, SPRADLIN & SMART, APC
555 Anton Boulevard, Suite 1200
Costa Mesa, California 92626
Attention: Douglas C. Holland, Esq.
Owner: PS Housing Investors, LP
c/o GLOBAL PREMIER DEVELOPMENT,
INC., its Administrative General Partner
2010 Main St. Suite 1250
Irvine, Ca. 92614
Attn: Andrew Hanna, President
Copy to:
The notice shall be deemed given three (3) business days after the date of
mailing, or, if personally delivered, when received.
13. GOVERNING LAW. This Agreement shall be governed by the laws of the State
of California.
14, COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall constitute one original and all of which shall be one
and the same instrument.
[END -- SIGNATURES ON NEXT PAGE]
58
IN WITNESS WHEREOF, the Agency and Owner have executed this Regulatory
Agreement and Declaration of Covenants and Restrictions by duly authorized
representatives on the date first written hereinabove.
"AGENCY"
COMMUNITY REDEVELOPMENT
AGENCY OF THE CITY OF PALM
SPRINGS, a public body, corporate and
politic
By:
David H. Ready, Esq., Ph.D.
Executive Director
ATTEST:
JAMES THOMPSON
City Clerk
APPROVED AS TO FORM:
DOUGLAS C. HOLLAND
AGENCY COUNSEL
"OWNER"
PS Housing Investors, LP, a California
Limited Partnership
By:
GLOBAL PREMIER DEVELOPMENT,
INC., its Administrative General Partner
ANDREW HANNA, President
[END OF SIGNATURES]
Attachments: Exhibit A Legal Description of Property
59
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 signatures(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 signatures(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]
- 60 -
EXHIBIT A TO REGULATORY AGREEMENT
LEGAL DESCRIPTION
All that certain real property situated in the City of Palm Springs, County of Riverside,
State of California, described as follows:
Parcel A:
Lots 33 and 34 of Palm Springs Estates No. 3, in the City of Palm Springs, County of Riverside,
state of California, as per map recorded In Book 17, Page 34,of Maps, in the Office of the County
Recorder of said County.
Except the East 4.50 feet.
Also Except the right to any deposit of oil, gas or other hydrocarbon substances underlying said
land, as reserved by California Trust Company, a Corporation, In deed recorded February 28, 1929
In Book 501, Page 61 of Deeds, records of Riverside County, California,
Parcel 8:
Lots 35 and 36 of Palm Springs Estates No. 3, in the City of Palm Springs, County of Riverside,
State of California, as per map recorded in Book 17, Page 34, of Maps, in the Office of the County
Recorder of said County.
Excepting therefrom that portion conveyed to the City of Palm Springs by Deed recorded April 22,
1953 in Book 2258, Page 431 of Official Records of Riverside County, California.
Also Excepting the right to any deposit of oil, gas or other hydrocarbon substances underlying said
land, as reserved by California Trust Company, a Corporation, in deeds recorded March 29, 1932 in
Book 70, Page 394 of Official Records of Riverside County, California, as to said Lot 1, and recorded
February 28, 1929 in Book 302, Page 4 of Deeds, records of Riverside County, California, as to said
Lots 35 and 36.
Parcel C:
Lot 32 of Palm Springs Estates No. 3, in the City of Palm Springs, County of Riverside, State of
California, as per map recorded in Book 17, Page 34, of Maps, in the Office of the County Recorder
of said County.
Except the rightto any deposit of oil, gas or other hydrocarbon substances underlying said land,as
reserved by California Trust Company, in deed recorded February 19, 1929 in Book 798, Page 465
of Deeds, records of Riverside County, California.
Assessor's Parcel Nos. 505-184-019, 020, 027
- 61 -
EXHIBIT "G"
PROMISSORY NOTE
DO NOT DESTROY THIS NOTE: When paid, this note must be surrendered to
Borrower for cancellation.
$1,000,000.00 Palm Springs, California
1 1, 2011
FOR VALUE RECEIVED, the undersigned, PS HOUSING INVESTORS, LP, a
California Limited Partnership ("Maker"), promises to pay the COMMUNITY
REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, a public body,
corporate and politic ("Holder") at Community Redevelopment Agency of the City of
Palm Springs, 3200 Tahquitz Canyon Way, P.O. Box 2743, Palm Springs, CA 92263,
the sum of One Million Dollars ($1,000,000.00), (the "Note Amount'), together with
interest thereon at the rate set forth herein. All sums payable hereunder shall be
payable in lawful money of the United States of America. This Promissory Note
("Agency Note") is made in connection with the provision by the Holder of funds equal to
the Agency Note pursuant to that certain the Owner Participation Agreement by and
among Maker and Holder, dated as of 2011 (the
"Agreement').
1. Interest Rate. Simple interest shall accrue on the Note Amount from the
date of disbursement at the rate of two percent (2%) per annum, or as determined
necessary to maximize the tax credit equity, but in no event greater than the maximum
interest rate permitted by law.
2. Repayment. Maker shall repay the principal amount of the Note Amount,
plus all interest then accrued at the interest rate set forth in Paragraph 1 above in
arrears, in annual installments in an amount equal to fifty percent of residual receipts
after the payment of customary expenses. The principal amount of the Note Amount,
plus all interest then accrued upon the Note Amount, shall be immediately due and
payable upon (i) any default of the Agreement, including without limitation the
conveyance of property not permitted by the Agreement, and Section 805, thereof,
which is not cured within the time set forth in Section 805 of the Agreement and, if not
sooner paid in full, (ii) on 2066.
3. Prepayment of Agency Note Amount. Maker may prepay to Holder the full
Note Amount, together with all accrued and unpaid interest thereon at the rate set forth
in Section 1 hereof, at any time prior to the due date of the Note Amount without
penalty.
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4. Application of Payments. Each payment hereunder shall be credited first
to interest then accrued and the remainder, if any, to principal. Interest shall cease to
accrue upon principal so credited.
5. Security. This Agency Note is secured by a deed of trust by and between
Maker, as trustor and Holder, as beneficiary (the "Deed of Trust" Exhibit "G" to the
Agreement).
6. Holder May Assign. Holder may, at its option, assign its right to receive
payment under this Agency Note without necessity of obtaining the consent of the
Maker.
7. Maker Assignment Prohibited. In no event shall Maker assign or transfer
any portion of this Agency Note without the prior express written consent of the Holder,
which consent may be given or withheld in the Holder's sole discretion.
8. Attorneys' Fees and Costs. In the event that any action is instituted with
respect to this Agency Note, the non-prevailing party promises to pay such sums as a
court may fix for court costs and reasonable attorneys' fees. Holder's right to such fees
shall not be limited to or by its representation by Agency Counsel, and such
representation shall be valued at customary and reasonable rates for private sector
legal services.
9. Non-Waiver. Failure or delay in giving any notice required hereunder shall
not constitute a waiver of any default or late payment, nor shall it change the time for
any default or payment.
10. Successors Bound. This Agency Note shall be binding upon the parties
hereto and their respective heirs, successors and assigns.
11. Terms. Any terms not separately defined herein shall have the same
meanings as set forth in the Agreement.
12. Collection of Penalties. No provision of this Agency Note or any
instrument securing payment hereof or otherwise relating to the debt evidenced hereby
shall require the payment or permit the collection of interest in excess of the maximum
permitted by applicable law. If any excess of interest in such respect is herein or in
such other instrument provided for, or shall be adjudicated to be so provided for herein
or in any such instrument, the provisions of this paragraph shall govern, in neither
Maker or any endorsers of this Note, nor their respective heirs, personal
representatives, successors or assigns shall be obligated to pay the amount of such
interest to the extent it is in excess of the amount permitted by applicable law.
13. Non-Recourse. Notwithstanding anything to the contrary herein
contained, (i) the liability of Maker shall be limited to its interest in the Site and any
rents, issues, and profits arising from the Site and, in addition, with respect to any
obligation to hold and apply insurance proceeds, proceeds of condemnation or other
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monies hereunder, any such monies received by it to the extent not so applied in
accordance with the terms of this Note; (ii) no other assets of Maker shall be affected by
or subject to being applied to the satisfaction of any liability which Maker may have to
Holder or to another person by reason of this Note; and (iii) any judgment, order, decree
or other award in favor of Holder shall be collectible only out of, or enforceable in
accordance with, the terms of this Note by termination or other extinguishment of
Maker's interest in the Site. Notwithstanding the foregoing, it is expressly understood
and agreed that the aforesaid limitation on liability shall in no way restrict or abridge
Maker's continued personal liability for: (A) fraud or willful or grossly negligent
misrepresentation made by Maker in connection with this Note or any of the Agency
Agreements; (B) misapplication of (a) proceeds of insurance and condemnation or (b)
rent received by Maker under rental agreements entered into for any portion of the Site
after default of the Note; (C) the retention by Maker of all advance rentals and security
deposits of tenants not refunded to or forfeited by such tenants; or (D) the
indemnification undertakings of Maker under the Agency Agreements.
IN WITNESS WHEREOF, Borrower has caused this Note to be executed by
Maker or Maker's authorized agent(s) as of the date and year first above written.
Maker:
By:
PS Housing Investors, LP
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EXHIBIT "H"
DEED OF TRUST
Recording requested by,
and when recorded mail to:
Community Redevelopment Agency of the City of Palm Springs
3200 Tahquitz Canyon Way
P.O. Box 2743
Palm Springs, Ca. 92263
Attention: Executive Director
INSTRUCTIONS TO COUNTY RECORDER:
Index this instrument as
(i) a Deed of Trust, and
(ii) a Fixture Filing
Space above for Recorder's Use
DEED OF TRUST AND ASSIGNMENT OF RENTS
This DEED OF TRUST AND ASSIGNMENT OF RENTS ("Deed of Trust") is
entered into between PS Housing Investors, LP, a California Limited Partnership, whose
principal executive office is at (the
"Trustor"), in favor of TITLE COMPANY, whose address is
(the "Trustee"), for the
benefit of the Community Redevelopment Agency of THE CITY OF PALM SPRINGS
(the "Beneficiary"), with offices at 3200 Tahquitz Canyon Way, P.O. Box 2743, Palm
Springs, California 92263.
THE TRUSTOR IRREVOCABLY GRANTS, TRANSFERS AND ASSIGNS TO
THE TRUSTEE, in trust, with the power of sale, the real property in the City of Palm
Springs, Riverside County, California, more particularly described in Exhibit A attached
hereto and made part hereof by reference (the "Property"), together with:
(i) All tenements, hereditaments and appurtenances of or to the Property,
including without limitation all easements and rights used in connection therewith or as
a means of access thereto, all right, title and interest of the Trustor, now owned or
hereafter acquired, in any land lying within the right-of-way of any street, open or
proposed, adjoining the Property, and any and all sidewalks, alleys, strips and other
areas of land adjacent to or used in connection with the Property;
(ii) All oil and gas or other mineral rights in or pertaining to the Property and
all royalty, leasehold and other rights of the Trustor pertaining thereto;
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(iii) All water rights pertaining to the Property and shares of stock evidencing
the same, and all deposits made with or other security given to utility companies by the
Trustor with respect to the Property;
(iv) The rents, issues and profits thereof, subject, however, to the right, power
and authority of Trustor to collect and apply such rents, issues and profits and set forth
in this Deed of Trust;
(v) All buildings and improvements of every kind and description now or
hereafter erected or placed on the Property, and all fixtures thereon, including, but not
limited to, all gas and electric fixtures, engines and machinery, radiators, heaters,
furnaces, heating equipment, laundry equipment, steam and hot water boilers, stoves,
ranges, elevators and motors, bath tubs, sinks, water closets, basins, pipes, faucets and
other plumbing and heating fixtures, mantels, cabinets, refrigeration plant and
refrigerators, whether mechanical or otherwise, cooking apparatus and appurtenances,
and all shades, awnings, screens, blinds and other furnishings, it being hereby agreed
that all such fixtures and furnishings shall to the extent permitted by law be deemed
permanently affixed to and a part of the realty;
(vi) All building materials and equipment now or hereafter delivered to the
Property and intended to be installed thereon; and
(vii) All articles of personal property owned by the Trustor and now or hereafter
attached to or used in and about the building or buildings now erected or hereafter to be
erected on the Property which are necessary to the complete and comfortable use and
occupancy of such building or buildings for the purposes for which they were or are to
be erected, and all other goods, chattels and personal property as are ever used or
furnished in operating a building, or the activities conducted therein, similar to the ones
herein described and referred to, and all renewals or replacements thereof or articles in
substitution therefor, whether or not the same are or shall be attached to the building or
buildings in any manner; subject, however, to (and only to) any purchase money
security interests in such personal property.
Said real property and personal property described above, together with appurtenances,
are referred to collectively in this Deed of Trust as the "Collateral."
FOR THE PURPOSE OF SECURING THE FOLLOWING OBLIGATIONS:
(a) Payment to the Beneficiary of an indebtedness in the principal amount of
One Million Dollars ($1,000,000.00), evidenced by a promissory note executed by the
Trustor and payable to the order of the Beneficiary, bearing the same date as this Deed
of Trust, and any and all modifications, extensions or renewals thereof or substitutions
therefor (the "Note"), and performance and satisfaction of each and all other obligations
of the Trustor under the Note;
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b Performance of eve obligation or Trustor in this Deed of Trust the( ) every g Note,
the Owner Participation Agreement between Beneficiary and Trustor related to the
Property (the "Participation Agreement') contemplating the improvement of the "Project'
(as that term is defined in the Participation Agreement); and
(c) Payment of all sums, if any, and interest thereon that may hereafter be
loaned or advanced by the Beneficiary to or for the benefit of the Trustor or to its
successors, transferees and assigns, made to the Trustor while the Trustor is the owner
of record of fee title to the Property, or any portion thereof, or to the successors,
transferees or assigns of the Trustor while they are the owners of record of such fee
title, and evidenced by one or more notes or written instruments which recite that they
are secured by this Deed of Trust.
TO PROTECT THE SECURITY OF THIS DEED OF TRUST, THE TRUSTOR
COVENANTS AND AGREES AS FOLLOWS:
1. The Trustor shall not use or permit the use of any of the Collateral for any
purpose other than the use for which it was intended at the time this Deed of Trust was
executed, as provided in the Participation Agreement.
2. Upon default under this Deed of Trust or the Note (following delivery of
notice and expiration of the cure period, if any, provided therein), the Beneficiary, at its
option, may declare the whole of the obligations and sums secured hereby to be
immediately due and payable.
3. The person(s) or entity(ies) who have executed this Deed of Trust are fully
authorized, and have obtained any and all written authorizations, approvals or consents
necessary, to bind the Trustor to this Deed of Trust.
4. All rents, profits and income from the Collateral covered by this Deed of
Trust are hereby assigned to the Beneficiary for the purpose of discharging the
obligations hereby secured. However, the Trustor shall be permitted, so long as no
default exists hereunder or under the Note, to collect such rents, profits and income for
use consistent with the provisions of the Agreement.
5. Upon default hereunder or under the Note (following delivery of notice and
expiration of the cure period, if any, provided herein or therein), for the purpose of
protecting its interests hereunder, the Beneficiary will be entitled to the appointment by
a court having jurisdiction, without further notice and without regard to adequacy of any
security for the indebtedness secured hereby, of a receiver to take possession of and
protect the Collateral described herein and operate same and collect the rents, profits
and income therefrom. The entering upon and taking possession of the Property or
other Collateral by such receiver, the collection of such rents, profits and income and
the application thereof shall not cure or waive any default or notice of default hereunder
or invalidate any act done pursuant to such notice.
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6. The Trustor, at its sole cost and expense, shall provide and maintain on
the entire Property, including all buildings and improvements thereon: (i) a policy of
broad-form builder's risk insurance sufficient to cover 100 percent of the replacement
value of all buildings and improvements on the Property including; without limitation,
labor and materials in place or to be used as part of the permanent construction
(including, without limitation, surplus miscellaneous materials and supplies incidental to
the work, and scaffolding, staging, towers, forms and equipment not owned or rented
by the Beneficiary, the cost of which is not included in the cost of work), insuring against
loss or damage by fire, extended coverage perils and such other hazards, casualties or
other contingencies as from time to time may be reasonably required by the Beneficiary;
(ii) a policy of commercial general liability insurance that includes contractual, products
and completed operations coverages, bodily injury and property damage liability
insurance with combined single limits of not less than $1,000,000 per occurrence; and
(iii) such other insurance as may be reasonably required by the Beneficiary, in each
case in such amounts, in such manner and with such companies as the Beneficiary and
Trustor may reasonably approve. The foregoing minimum insurance coverage limits
shall be subject to reasonable adjustment from time to time by the Beneficiary. Each
such policy shall be endorsed with a standard mortgage clause with loss payable to the
Beneficiary and the Trustor, and shall provide that the policy shall not be canceled or
materially changed without at least thirty (30) days' prior notice to the Beneficiary. Upon
request by the Beneficiary, the Trustor immediately shall deposit with the Beneficiary
certificates evidencing such policies.
7. The Trustor shall pay: (i) at least ten days before delinquency, all taxes
and assessments affecting the Collateral, including assessments on appurtenant water
stock; (ii) when due, all encumbrances, charges and liens, with interest, on the
Collateral or any part thereof which appear to be prior or superior hereto; and (iii) all
costs, fees and expenses of the Trustee or the Beneficiary reasonably incurred in
connection with the trusts created under this Deed of Trust.
8. The Trustor shall: (i) keep the Collateral in good condition and repair and
not remove or demolish any buildings on the Property; to the extent insurance or
condemnation proceeds are available; (ii) complete or restore promptly and in good and
workmanlike manner the buildings and improvements and any other building or
improvement which may be constructed, damaged or destroyed thereon; (iii) pay when
due all claims for labor performed and materials furnished therefore; (iv) comply in all
material respects with all laws affecting the Collateral or requiring any alterations or
improvements to be made thereon; (v) not commit or permit waste of or on the
Collateral; and (vi) not commit, suffer or permit any act upon the Property in violation of
law and/or any covenants, conditions or restrictions affecting the Collateral.
9. The Trustor shall appear in and defend any action or proceeding
purporting to affect the security hereof or the rights or powers of the Beneficiary or the
Trustee, and shall pay all costs and expenses, including cost of evidence of title and
reasonable attorneys' fees, in any such action or proceeding in which the Beneficiary or
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the Trustee may appear, or in any suit brought by the Beneficiary to foreclose this Deed
of Trust.
10. Should the Trustor fail to make any payment or do any act as herein
provided, then the Beneficiary or the Trustee, without obligation to do so, and following
notice to or demand on the Trustor, and without releasing the Trustor from any
obligation hereof: (i) may make or do the same in such manner and to such extent as
either may deem necessary to protect the security hereof, the Beneficiary or the Trustee
being authorized to enter on the Property for such purposes; (ii) may commence,
appear in and/or defend any action or proceeding purporting to affect the security hereof
or the rights or powers of the Beneficiary or the Trustee; (iii) may pay, purchase, contest
or compromise any encumbrance, charge or lien which in the judgment of either
appears to be prior or superior hereto (except for the deeds of trust, encumbrances and
liens securing the Construction/Permanent Financing Loan(s) and the Agency Loan, as
such terms are defined below); and (iv) in exercising any such powers, may pay
necessary expenses, employ legal counsel and pay such counsel's reasonable fees.
All such amounts paid by the Beneficiary or the Trustee hereunder shall be added to the
obligations secured by this Deed of Trust.
The term "Construction/Permanent Financing Loan" means, collectively, the
construction financing and take-out financing, and any refinancing or replacement of
that financing from time to time, to be provided by a commercial or other lender(s);
provided, however, that (i) before entering into any Construction/Permanent Financing
Loan, the Trustor shall give the Beneficiary notice of the Construction/Permanent
Financing Loan and copies of the loan agreement and all other loan documents
evidencing the Construction/Permanent Financing Loan; (ii) the funds disbursed from
each Construction/Permanent Financing Loan shall be used only for costs and charges
associated with the loan and for the operation, maintenance and/or improvement of the
Project or the Property as provided in the Agreement or to refinance existing
indebtedness; (iii) the interest on each Construction/Permanent Financing Loan shall be
at a reasonable rate based on all the facts and circumstances; and (iv) the combined
amounts of all Construction/Permanent Financing Loans or any re-financing thereof and
the Note secured by this Deed of Trust shall not exceed one hundred percent (100%) of
the fair market value of the Property as improved by the Project under the Agreement
(such value to be determined by a qualified appraiser reasonably acceptable to Trustor
and Beneficiary).
11. The Beneficiary shall have the right, but not the obligation, to pay when
due fire or other insurance premiums required hereunder if the Trustor fails to make
such payments. All such amounts paid by the Beneficiary hereunder shall be added to
the obligations secured by this Deed of Trust.
12. The Trustor shall pay immediately upon demand all sums so expended by
the Beneficiary or the Trustee under this Deed of Trust, with interest from date of
expenditure at the legal rate.
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13. If the Trustor fails to pay any amount required by the Note or this Deed of
Trust when due and payable, or fails to perform all other covenants, conditions and
agreements of the Note, this Deed of Trust or the Participation Agreement (following
delivery of notice and expiration of the cure period, if any, provided therein), the amount
of the Note, including unpaid principal and late charges, and all other charges and
amounts required by the Note and this Deed of Trust shall, at the option of the
Beneficiary, become immediately due and payable. This shall be in addition to and
without limitation on any other remedy or right available to the Beneficiary for such
failure.
14. The Trustor shall not voluntarily create or permit to be created against the
Collateral any lien or liens except as specifically permitted by this Deed of Trust or
otherwise authorized by the Beneficiary. The Trustor shall keep and maintain the
Collateral free from the claims of all persons supplying labor or materials who will enter
into the construction, rehabilitation, renovation or repair of any and all buildings or
improvements now existing or to be erected on the Property.
15. By accepting payment of any sum secured by this Deed of Trust after its
due date or by accepting partial payment of any such sum, the Beneficiary does not
waive its right either to require prompt payment when due of all other sums so secured
or to declare default for the Trustor's failure to pay.
16. If the Trustor, without the prior written consent of the Beneficiary: (i)
agrees to or actually sells, conveys, transfers or disposes of the Collateral or any
interest therein or portion thereof, or (ii) assigns or delegates any right or obligation
under the Agreement, the Note or this Deed of Trust, then all amounts secured by this
Deed of Trust may be declared immediately due and payable, at the option of the
Beneficiary. The Beneficiary shall not unreasonably withhold its consent to any such
transaction. The Beneficiary's consent to one transaction of this type shall not be a
waiver of the right to require consent to future or successive transactions.
17. As further security for the full and complete performance of each and
every obligation, covenant, agreement and duty of the Trustor contained herein or in the
Note, the Trustor hereby grants and conveys to the Beneficiary a security interest in and
lien on all of the Collateral. This Deed of Trust shall serve as a security agreement and
financing statement created pursuant to the California Commercial Code, and the
Beneficiary will have and may exercise all rights, remedies and powers of a secured
party under the California Commercial Code. Further, this Deed of Trust is filed as a
fixture filing pursuant to the California Commercial Code and other applicable law, and
covers goods which are or are to become fixtures.
18. Should the Property, the buildings or improvements thereon, or any part of
any of them be taken or damaged by reason of any public improvement or
condemnation proceeding, or damaged by fire or earthquake or in any other manner,
the Beneficiary will be entitled, subject to the rights of the holder of any senior deed of
trust securing a Construction/Permanent Financing Loan, to all of the Trustor's interest
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in compensation, awards and other payments or relief therefor; and, following the
occurrence of a default as defined in the Note, the Beneficiary shall be entitled, jointly
with the Trustor, at the Beneficiary's option, to commence, appear in and prosecute in
its own name, any action or proceeding, or to make any compromise or settlement, in
connection with such taking or damage. All such compensation, awards, damages,
rights of action and proceeds, including the proceeds of any fire and other insurance
affecting the Property or the buildings or improvements thereon, are hereby assigned to
the Beneficiary, subject to the rights of the holder of any senior deed of trust securing a
Construction/Permanent Financing Loan. After deducting therefrom all its expenses,
including reasonable attorneys' fees, and if there has not occurred a default under the
Note, the Beneficiary shall apply all such proceeds to restoring the Property or the
buildings or improvements thereon, or if there has been such default, or if the Trustor
determines not to rebuild, the Beneficiary shall retain the proceeds to the extent of the
amount due under the Note and any amounts due under this Deed of Trust. Any
balance of such proceeds still remaining shall be disbursed by the Beneficiary to the
Trustor.
19. If the Trustor fails to perform any covenant or agreement in this Deed of
Trust or the Participation Agreement, or if a default occurs under the Note, the
Beneficiary may declare all obligations and sums secured hereby immediately due and
payable by delivery to the Trustee of written declaration of default and demand for sale
and written notice of default and of election to cause the Collateral to be sold, which
notice the Trustee shall cause to be duly filed for record, and the Beneficiary may
foreclose this Deed of Trust; provided, however that the Trustor shall not be deemed to
be in default hereunder for failure to make any payment when due or for failure to
perform any other covenant or agreement contained herein until thirty (30) days after
written notice of such failure is given to the Trustor and Trustor is afforded a reasonable
opportunity to cure the default. The Beneficiary shall also deposit with the Trustee this
Deed of Trust, the Note and all other documents evidencing the obligations or sums
secured hereby.
20. After the lapse of such time as may then be required by law following the
recordation of the notice of default, and notice of sale having been given as then
required by law, the Trustee, without demand on the Trustor, shall sell the Property at
the time and place fixed by the Trustee in the notice of sale, either as a whole or in
separate parcels, and in such order as it may determine, at public auction to the highest
bidder for cash in lawful money of the United States, payable at time of sale. The
Trustee may postpone sale of all or any portion of the Property by public announcement
at the time and place of sale, and from time to time thereafter may further postpone the
sale by public announcement at the time fixed by the preceding postponement. The
Trustee shall deliver to the purchaser its deed conveying fee title to the Property or
portion thereof so sold, but without any covenant or warranty, express or implied. The
recitals in the Trustee's deed of any matters or facts shall be conclusive proof of the
truthfulness thereof. Any person, including the Trustor, the Trustee and the Beneficiary,
may purchase at the sale. The Trustee shall apply the proceeds of the sale to payment
of: (i) the expenses of the sale, together with the reasonable expenses of the trust
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created by this Deed of Trust, including reasonable Trustee's fees and attorneys' fees
for conducting the sale, and the actual cost of publishing, recording, mailing and posting
notice of the sale; (ii) the cost of any search and/or other evidence of title procedure in
connection with the sale and of revenue stamps on the Trustee's deed; (iii) all sums
expended under the terms hereof not then repaid, with accrued interest at the legal rate;
(iv) all other sums then secured hereby; and (v) the remainder, if any, to the person or
persons legally entitled thereto.
21. The Beneficiary may from time to time substitute a successor or
successors to the Trustee named herein or acting hereunder to execute the trusts under
this Deed of Trust. Upon such appointment, and without conveyance to the successor
trustee, the latter shall be vested with all title, powers and duties conferred upon any
Trustee herein named or acting hereunder. Each such appointment and substitution
shall be made by written instrument executed by the Beneficiary, containing reference
to this Deed of Trust and its place of record, which instrument, when duly recorded in
Riverside County, California, shall be conclusive proof of proper appointment of the
successor trustee.
22. Upon written request of the Beneficiary stating that all obligations secured
hereby have been satisfied and all sums secured hereby have been paid, and upon
surrender of this Deed of Trust and the Note to the Trustee for cancellation and
retention, and upon payment of its fees, the Trustee shall reconvey, without warranty,
the Collateral then held hereunder. The recitals in such reconveyance of any matters or
facts shall be conclusive proof of the truthfulness thereof. The grantee in such
reconveyance may be described as "the person or persons legally entitled thereto."
23. The trusts created by this Deed of Trust are irrevocable by the Trustor.
24. This Deed of Trust applies to, inures to the benefit of, and binds of the
Trustor, the Beneficiary and the Trustee and their respective administrators, executors,
officers, directors, transferees, successors and assigns. The term "Beneficiary" shall
include not only the original Beneficiary hereunder but also any future owner and holder,
including pledges, of the Note secured hereby. In this Deed of Trust, whenever the
context so requires, the masculine gender includes the feminine and/or neuter, and the
singular includes the plural.
25. In addition to and without limitation on any other rights or remedies of the
Trustee or the Beneficiary, if the Trustee or the Beneficiary commences any legal action
or proceeding to enforce or interpret any provision of this Deed of Trust or the Note, the
Trustor shall pay all costs and expenses incurred by the Trustee or the Beneficiary in
connection with such action or proceeding, including legal expenses and reasonable
attorneys' fees and court costs.
26. The Trustee accepts the trusts hereunder when this Deed of Trust, duly
executed and acknowledged, is made public record as provided by law. Except as
otherwise provided by law, the Trustee is not obligated to notify any party hereto of
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pending sale under this Deed of Trust or of any action or proceeding in which the
Trustor, the Beneficiary or the Trustee is a party, unless brought by the Trustee.
27. The Trustor requests that a copy of any notice of default and of any notice of sale
hereunder be mailed to it at 2010 Main St. Suite 1250, Irvine, Ca. 92614.
28. The Trustor shall cause a copy of each deed of trust securing a
Construction/ Permanent Financing Loan to be provided to the Beneficiary immediately
upon its recordation, so that the Beneficiary may prepare and record a request for
notice of default and notice of sale thereunder pursuant to California Civil Code Section
2924b.
29. PROVIDED THAT NO NOTICE OF DEFAULT HEREUNDER THEN
APPEARS OF RECORD AND SUBJECT TO THE CONDITIONS IN SECTION 10
ABOVE AND/OR IN THE PARTICIPATION AGREEMENT, THIS DEED OF TRUST
SHALL BE SUBORDINATE AND SUBJECT TO ANY DEED OR DEEDS OF TRUST
SECURING A CONSTRUCTION/PERMANENT FINANCING LOAN. TRUSTOR
SHALL, UPON REQUEST OF BENEFICIARY, EXECUTE SUCH SUBORDINATION
AGREEMENT OR OTHER DOCUMENTATION REASONABLY NECESSARY TO
SUBORIDINATE THE LIEN AND CHARGE OF THIS DEED OF TRUST TO LIEN OF
ANY DEED OR DEEDS OF TRUST SECURING A CONSTRUCTION/PERMANENT
FINANCING LOAN.
30. This Deed of Trust shall be interpreted and enforced, and the rights and
duties (both procedural and substantive) of the parties hereunder shall be determined,
according to California law.
31. Capitalized terms not otherwise defined herein shall have the meanings
given them in the Agreement or the Note.
IN WITNESS WHEREOF, Trustor has executed this Deed of Trust as of the date
set forth above.
TRUSTOR:
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ACKNOWLEDGMENTS
STATE OF CALIFORNIA )
) ss.
COUNTY OF RIVERSIDE )
On 2011, before me,
Notary Public, personally appeared
who 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/shelthey 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.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
(SEAL)
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EXHIBIT A TO DEED OF TRUST
LEGAL DESCRIPTION
All that certain real property situated in the City of Palm Springs, County of Riverside, State
of California, described as follows:
Parcel A:
Lots 33 and 34 of Palm Springs Estates No. 3, in the City of Palm Springs, County of Riverside,
State of California, as per map recorded In Book 17, Page 34,of Maps, in the Office of the County
Recorder of said County.
Except the East 4.50 feet.
Also Except the right to any deposit of oil, gas or other hydrocarbon substances underlying said
land, as reserved by California Trust Company, a Corporation, in deed recorded February 28, 1929
In Book 801, Page 81 of Deeds, records of Riverside County, California.
Parcel B:
Lots 35 and 36 of Palm Springs Estates No. 3, in the City of Palm Springs, County of Riverside,
State of California, as per map recorded in Book 17, Page 34, of Maps, in the Office of the County
Recorder of said County.
Excepting therefrom that portion conveyed to the City of Palm Springs by Deed recorded April 22,
1953 in Book 2258, Page 431 of Official Records of Riverside County, California.
Also Excepting the right to any deposit of oil, gas or other hydrocarbon substances underlying said
land, as reserved by California Trust Company, a Corporation, in deeds recorded March 29, 1932 in
Book 70, Page 394 of Official Records of Riverside County, Califomia, as to said Lot 1, and recorded
February 28, 1929 In Book 302, Page 4 of Deeds, records of Riverside County, California, as to said
Lots 35 and 36.
Parcel C:
Lot 32 of Palm Springs Estates No. 3, in the City of Palm Springs, County of Riverside, State of
California, as per map recorded in Book 17, Page 34,of Maps, in the Office of the County Recorder
of said County.
Except the right to any deposit of oil, gas or other hydrocarbon substances underlying said land, as
reserved by California Trust Company, in deed recorded February 19, 1929 in Book 798, Page 465
of Deeds, records of Riverside County, Califomia.
Assessor's Parcel Nos. 505-184-019, 020, 027
- 75 -
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