HomeMy WebLinkAbout00370C - COOPERATIVE SERVICES HUD VISTA CHINO SENIOR HOUSING OPTION AGR Cooperative Services, Inc.
• . Option Agr - Develop Sr Hsg
Complex Under HUD
AGREEMENT #370C
OPTION AciREMMNT R1009, 8-7-96
THIS OPTION AGREEMENT (referred to herein as this ",Agreement"
or this "Option") is made and entered into this (_- day of
1996 ("Grant Date") , by and between THE COMMUNITY
REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA, a
public body, corporate and politic ("Optionor") , and COOPERATIVE
SERVICES, INC. , a Michigan nonprofit cooperative corporation
("Opticnee") ,
A. optionor is the owner of that certain unimproved real
property located in the County of. Riverside, State of California,
generally depicted on Exhibit "A" attached hereto and incorporated
herein (the "Optionor Property") .
B. Optionee desires to have the right to acquire a portion
of the Optionor Property, which is generally depicted on Exhibit
"A"" attached hereto (the "Property") . Optionor is willing to grant
Optionee an option to acquire the Property subject to all of the
terms, conditions and provisions of this Agreement.
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
OPTION TO ACQUIRE
Section 1. 1 - Grant of Option. Optionor hereby grants
Opticnee an option to acquire the Property ("Option") for a
purchase price of FOUR HUNDRED THOUSAND SIX HUNDRED DOLLARS
($400,600.00) ("Purchase Price") upon all of the terms, covenants
and conditions contained in a Disposition and Development Agreement
to be negotiated by Optionor and . Optionee pursuant to the
provisions of Section 2.3 below ("DDA") . This option shall
commence on the Grant Date and continue until the earlier to occur
of (1) 4 :00 p.m. on March 3#, 199�0 or (ii) on the date Opticnee
receives notice from the United States Department of Housing and
Urban Development ("HUD") that Optionee's application for a fund t�) '
reservation under section 202 of the Housing Act of 1959, 12 U.S.C. _
Section 1701q ("Fund Reservation") for the acquisition of the`
Property and the development of a senior citizen housing project
containing at least fifty two (52) units ("Project") has been
rejected or denied ("Option Period") .
section 1.2 - Consideration. As consideration for the
granting of this Option, Opticnee shall pay Optionor the sum of TEN
DUP).. C,,N E
07ID140"L2130067143 -MI06M OR
DOLLARS ($10. 00) , the sufficiency of which is hereby acknowledged.
Said option consideration shall not be applicable to the Purchase
Price. As additional consideration for the granting of this
Option, Optionee hereby agrees to submit an application for the
Fund Reservation to HUD on or before August 19 , 1996 and,
thereafter, to use its best efforts to secure the Fund Reservation
from HUD. If possible, Optionee agrees to request that HUD provide
carbon copies of all correspondence and notices regarding the Fund
Reservation to Optionor.
Section 1. 3 - Automatic Termination. In the event Optionee
has not exercised the Option to acquire the Property in the manner
set forth in Article II below on or before 4: 00 p.m. on the date
the Option Period is to expire pursuant to Section 1. 1 above, the
Option shall automatically terminate without any notice to
Optionee, and all rights of Optionee in and to the Property shall
then and there cease.
ARTICLE II
EXERCISE OF OPTION TO ACQUIRE
Section 2 . 1 - Conditions on Exercising Option. Optionee
acknowledges that the option granted to Optionee hereunder is
subject to the approval and timely execution of the DDA in
accordance with Section 2 . 3 below, which condition must be
satisfied prior to the Optionee having the right to exercise the
Option. Nothing in this Agreement shall abridge or infringe upon
the legislative an administrative discretion reserved to Optionor
as a public agency with respect to any actions required to be taken
by this Agreement or the DDA.
Section 2 . 2 - Method of Exercising Option. In the event
Optionee desires to exercise this Option and has performed all acts
in the time and manner as required by the terms hereof and is not
in default under any provision of this Agreement, Optionee shall
exercise its Option by delivering to Optionor, on or before 4: 00
p.m. on the day on which the Option would otherwise expire, written
notice of Optionee's election to acquire the Property together with
a copy of HUD's approval of the Fund Reservation.
Section 2 . 3 - Disposition and Development Agreement. Optionee
shall give Optionor written notice of approval of the Fund
Reservation and, after receipt of such notice, Optionor will
prepare and deliver a draft DDA to Optionee for review. Optionor
and Optionee hereby agree to negotiate the terms of the DDA in good
faith. The DDA shall contain the usual and customary terms and
provisions of Optionor's standard form disposition and development
agreements and shall, at a minimum, provide for the following:
(a) The purchase price for the Property shall be equal
to the Purchase Price; provided that, if the fair market value
of the Property, as determined by the HUD appraisal performed
497/014084-001213006714.3 a08102/96 -2-
in connection with the Fund Reservation application, is less
than the Purchase Price, the parties agree to negotiate in
good faith to arrive at a new purchase price. If the parties
cannot arrive at an agreement regarding a new purchase price,
then Optionee shall have the right to purchase the Property
for the Purchase price or terminate this Agreement.
(b) Optionee shall place into the escrow for the
conveyance of the Property a deposit equal to TEN DOLLARS
($10. 00) . Optionor shall have the right to retain the deposit
as liquidated damages if Optionee breaches the DDA.
(d) Optionee shall have the right to review and approve
the status of title to the Property prior to the close of
escrow.
(e) Optionee shall have the right to make a complete
analysis of the Property consisting of such engineering,
feasibility studies and soils tests as are sufficient to
permit Optionee to determine the suitability of the Property
for the Project.
(£) Optionor shall convey the Property to Optionee
without representation or warranty as to the condition of the
Property or the suitability of the Property for Optionee's
intended purposes. Optionee shall accept the Property in its
"As-Is", "Where-Is" and "With-All-Faults" condition.
(g) All escrow fees, costs, expenses related to the
transfer of the Property shall be paid by Optionor.
(h) Optionee shall construct all improvements on the
Property in accordance with the plans and specifications
approved by the Optionor.
(i) Prior to the close of escrow, Optionor shall prepare
a legal description of the Property at Optionoe's sole cost
and expense, which legal description shall be attached as an
exhibit to the grant deed.
(j) The grant deed conveying the Property to Optionee
shall contain a restriction that the Property is to be owned,
managed and operated as the Project for a term of thirty (30)
years from the date the construction of the Project is
completed. Said restriction shall further provide that (i)
all of the units shall be continuously occupied or held vacant
and available for occupancy by low income or moderate income
senior citizen tenants, as determined by criteria established
by HUD; and (ii) the Project shall comply with all HUD
requirements with respect to rental rates, rental policies,
availability to the general public, maintenance, reporting
requirements and any other matter which is the subject of
487/014094-0012/3006714.3 &08/02/96 -3-
applicable HUD regulations. The deed restriction shall be
subject to HUD approval.
(k) Prior to the close of escrow, Optionor, at its sole
cost and expense, shall deliver a parcel map to the escrow
holder which subdivides the Property into a separate legal
parcel in accordance with the requirements of the Subdivision
Map Act. The parcel map shall be recorded prior to the close
of escrow.
ARTICLE III
TERMINATION OF OPTION
Section 3 . 1 - Automatic Termination. This Option shall
automatically terminate without notice to Optionee pursuant to
Section 1.3 above. Such termination shall not release Optionee
from its obligations to pay sums due and owing pursuant to the
terms hereof up to and including the date of such termination nor
from Optionee's obligations pursuant to this Article III and
Sections 4 . 1 and 4 . 3 hereof.
Section 3 .2 - Document to Remove Cloud. This Agreement
constitutes only an Option to acquire the Property, and although
the Option granted hereby and all extensions thereof shall
automatically terminate with respect to the Property unless
exercised and/or extended within the times provided for herein, or
shall otherwise terminate as provided in this Article III, Optionee
nonetheless in all events agrees to execute, acknowledge and
deliver to Optionor within ten (10) days after Optionor's request
therefor, any quitclaim deed or other documents required by a
reputable title company of Optionor's choice, which said title
company might require to remove any cloud from the title of
Optionor to the Property that might arise as a result of the Option
herein granted if such Option is not exercised prior to expiration
or termination, or if Optionee defaults hereunder.
ARTICLE IV
MISCELLANEOUS
Section 4 . 1 - Attorneys' Fees. In the event of any dispute
between the parties hereto involving the covenants or conditions
contained in this Option or arising out of the subject matter of
the Option, the prevailing party shall be entitled to recover, and
the other party agrees to pay, all reasonable fees, expenses and
costs, including, but not limited, to attorneys' fees.
Section 4.2 - Notices. Unless otherwise provided for herein,
any notice to be given or other document to be delivered by either
party to the other hereunder shall either be delivered in person to
such party or may be deposited in the United States mail, duly
certified and registered, or by reputable overnight delivery
487/014094-0012/3006714.3 &08/02/96 -4-
service, with postage prepaid, addressed to the party for whom
intended as follows:
To Optionor: The Community Redevelopment Agency of
the City of Palm Springs, California
3200 East Tahquitz Canyon Way
Palm Springs, CA 92263
Attn: Executive Director
Copy to: Rutan & Tucker
611 Anton Boulevard, Suite 1400
Costa Mesa, California 92626
Attn: David J. Aleshire, Esq.
To Optionee: Cooperative Services, Inc.
25900 Greenfield Road, Suite 326
Oak Park, MI 48237
Attn: Mr. Fred Wood
Either party may from time to time, by written notice to the
others, designate a different address which shall be substituted
for the one above specified, and/or specify additional parties to
be notified.
Notwithstanding anything to the contrary herein contained, any
notices or documents which may be delivered by mail pursuant to
this Section 4.2 must be actually delivered to the other party on
the last business day immediately preceding any deadline date
specified in this Agreement.
Section 4. 3 - Broker's Fee. Each party agrees to indemnify
and hold the other harmless from and against all liabilities,
costs, damages and expenses, including, without limitation,
attorneys' fees, resulting from any claims or fees or commissions,
based upon agreements by it, if any, to pay broker's commissions
and/or finder's fees.
Section 4.4 - Assignment. Except as set forth in this Section
4.4 below, Optionee shall have no right to assign the Option herein
granted or any right or privilege Optionee might have in the
Option, by operation of law or otherwise, without the prior written
consent of Optionor, which consent may be withheld in Optionor's
sole and absolute discretion. Any attempt by Optionee to make an
assignment other than with the prior written consent of Optionor
shall be null and void and shall automatically terminate the
Option. Optionor's consent to an assignment by Optionee shall not
relieve Optionee from its obligations under this Agreement. In the
event Optionee is a partnership or corporation, any cumulative
transfer of more than twenty-five percent (25%) of the partnership
interest or interest as a shareholder in the corporation, as owned
on the date hereof, shall constitute an assignment requiring the
consent of Optionor for the purposes of this Section 4 . 4 .
Notwithstanding the foregoing, without the consent of Optionor,
Optionee shall have the right to assign this Agreement to a non-
4871014084-001213006714.3 &08102/96 -5-
profit public benefit corporation controlled by Optionee and formed
for the sole purpose of owning and operating the Project as
required by HUD. Prior to assigning this Agreement to a non-profit
corporation, Optionee shall submit to Optionor evidence that
Optionee exercises control over the assignee.
Section 4. 5 - Time of the Essence. Time is of the essence of
each of the terms, covenants and conditions of this Agreement.
Section 4. 6 - Binding on Heirs. Subject to the limitations
set forth in Section 4.4 above, this Agreement shall be binding
upon and inure to the benefit of the heirs, personal
representatives, successors and assigns of the respective parties
hereto.
Section 4 . 7 - Entire Agreement. This Agreement contains the
entire agreement of the parties hereto with respect to the matters
covered hereby, and all negotiations and agreements, statements or
promises between the parties hereto or their agents with respect to
this transaction are merged in this Agreement, which alone
expresses the parties' rights and obligations. No prior agreements
or understandings not contained herein shall be binding or valid
against either of the parties hereto.
Section 4. 8 - Modification. Any amendments or modifications
to this Agreement must be in writing and executed by all the
parties to this Agreement.
Section 4.9 - Interpretation• Governing Law. This Agreement
shall be construed according to its fair meaning and as if prepared
by both parties hereto. This Agreement shall be construed in
accordance with the laws of the State of California in effect at
the time of the execution of this Agreement. Titles and captions
are for convenience only and shall not constitute a portion of this
Agreement. As used in this Agreement, masculine, feminine or
neuter gender and the singular or plural number shall each be
deemed to include the others wherever and whenever the context so
dictates.
Section 4. 10 - No Waiver. No delay or omission by either
party hereto in exercising any right or power accruing upon the
compliance or failure of performance by the other party hereto
under the provisions of this Agreement shall impair any such right
or power or be construed to be a waiver thereof. A waiver by
either party hereto of a breach of any of the covenants, conditions
or agreements hereof to be performed by the party shall not be
construed as a waiver of any succeeding breach of the same or other
covenants, agreements, restrictions or conditions thereof.
Section 4 . 11 - Severability. If any term, provision,
condition or covenant of this Agreement or the application thereof
to any party or circumstances shall, to any extent, be held invalid
or unenforceable, the remainder of this instrument, or the
application of such term, provision, condition or covenant to
487/014084-0012/3006714.3 a08/02/96 -6-
persons or circumstances other than those as to whom or which it is
held invalid or unenforceable, shall not be affected thereby, and
each term and provision of this Agreement shall be valid and
enforceable to the fullest extent permitted by law.
Section 4.12 - Authority to Execute. Each individual
executing this Agreement on behalf of a partnership or corporation
represents and warrants that he or she is duly authorized to
execute and deliver this Agreement and the DDA on behalf of such
partnership or corporation in accordance with the authority granted
under the formation documents of such entity, and, if a
corporation, by a duly passed resolution of its Board of Directors,
that all conditions to the exercise of such authority have been
satisfied, and that this Agreement are or will be binding upon such
entity in accordance with their respective terms.
Section 4. 13 - Counterparts. This Agreement, including any
exhibits attached hereto, may be executed by the parties hereto in
several counterparts, each of which shall be deemed to be an
original copy.
Section 4 . 1 - No Recordation. Optionee shall not cause or
allow this Agreement, short form, memorandum or assignment hereof
to become of record in any public office without Optionor's prior
written consent, which consent may be withheld in Optionor's sole
and absolute discretion.
Section 4 . 15 - Exhibits. Exhibit "A" attached hereto
is hereby incorporated herein by this reference.
IN WITNESS WHEREOF, the parties hereto have executed this
Option Agreement the day and year first above written.
ATTEST: COMMUNITY REDEVELOPMENT AGENCY OF THE
CITY OF PALM SPRINGS, CALIFORNIA, a
public body, corporate and politic
By c �_,_' BY:
Assistant Secretary — Chairperson
REVIEWED AND APPROVED
RUTAN & TUCKER
C:O: I,Vdt`au�l� 't1RN'li° F, i9k="kf
By: " aP s
(/ 3
Agency Counsel
"OPTIONOR"
[signatures continued on next page. ]
4871014094-001213006714.3 "102 95 -7-
COOPERATIVE SERVICES, INC. , a Michigan
nonprofit cooperative corporation
By:_
Its:
By:
Its:
"OPTIONEE"
THIS OPTION AGREEMENT SHALL NOT BE RECORDED.
487/014094-0012/3006714.3 &08/02196
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EXHIBIT "A"
LEGAL DESCRIPTION OF PROPERTY
UNDER CONSIDERATION
A PORTION OF PARCEL 1 OF PARCEL MAP BOOK 17, PAGE 7, BEING A
PORTION OF THE NORTHEAST QUARTER OF THE NORTHEAST QUARTER OF
SECTION 11, TOWNSHIP 4 SOUTH, RANGE 4 EAST, SAN BERNARDINO BASE
AND MERIDIAN, IN THE CITY OF PALM SPRINGS, COUNTY OF RIVERSIDE,
STATE OF CALIFORNIA, OF MAPS, RECORDS OF RIVERSIDE COUNTY,
CALIFORNIA, DESCRIBED AS FOLLOWS:
COMMENCING AT THE SOUTHWEST CORNER OF SAID PARCEL 1;
THENCE NORTH 89044125" EAST, A DISTANCE OF 330 FEET, TO
A POINT OF BEGINNING;
THENCE SOUTH 89044'25" EAST, A DISTANCE OF 225. 96 FEET;
THENCE NORTH 0020'42" EAST, A DISTANCE OF 514 . 44 FEET;
THENCE NORTH 89040'33" WEST, A DISTANCE OF 250. 61 FEET;
THENCE SOUTH 0020'15" WEST, A DISTANCE OF 94. 99 FEET;
THENCE SOUTH 89040'34" EAST, A DISTANCE OF 24. 50 FEET;
THENCE SOUTH 0020'15" WEST, A DISTANCE OF 419.70 FEET
TO THE POINT OF BEGINNING.