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HomeMy WebLinkAbout00317C - CORPORATE FUND FOR HOUSING REHABILITATION GRANT TAHQUITZ COURT DOC # 2006-0663040 12/19/2008 08:OOA FeeA2.00 Page 1 of 12 Recorded in Official Records County of Riverside Larry W. Ward Rssessar, County Clerk 8 Recorder FREE RECORDING REQUESTED BY I III IIII I III I IIIIII II I H III II I I II AND WHEN RECORDED ,MAIL TO: City Clerk S R U PAGE SIZE DA MISC LONG RFD COPY City of Palm Springs 1 is Box 2743 Patin Springs, CA 92263 M A L 465 1 426 1 PCOR NCOR SMF NCNG EXVM JJ: �\ T: CTY UNI '� [1]MODIFICATION OF REGULATORY AGREEMENT THIS MODIFICATION OF REGULATORY AGREEMENT ("Modification") is made ibis 157`'day of 2008 by and among THE HOUSING AUTHORITY OF THE CITY OF PALM SPRINGS, a housing authority of the State of California duly organized and existing under the laws thereof ("Authority"), CORPORATE FUND FOR HOUSING, a California nonprofit public benefit corporation ("Owner"), and TAHQUITZ ASSOCIATES, LP, a California limited partnership ("Buyer"). RECITALS A. Authority, Owner and Seattle-First National Bank, as trustee, are parties to that certain Regulatory Agreement and Declaration of Restrictive Covenants ("Regulatory Agreement") dated September 1, 1993, recorded September 30, 1993, in the Official Records of Riverside County, California as Instrument No. 382200, affecting certain real property of Owner 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 ("Property"). The Regulatory Agreement was executed in connection with the issuance of$3,380,000.00 Housing Authority of the City of Palm Springs Multifamily Housing Mortgage Revenue Bonds (Tahquitz Court Apartments) ("Bonds"), and provides for certain terms, conditions, covenants and restrictions relating to a low income multi-family housing project located on the Property. B. The Bonds have been redeemed and paid in full, and as of the date hereof no Bonds are outstanding. C_ Owner desires to transfer the Project (as defined in the Regulatory Agreement) to Buyer and obtain financing from Capmark Bank ("Lender") in the amount of $4,326,000.00 ("Loan"). The Lender would not make the Loan without the Authority's consent to the transfer and modification of the Regulatory Agreement to incorporate the terms of the Freddie Mac Rider attached hereto. D. Owner is a Qualifying Section 501(c)(3) Organization (as defined in the Regulatory Agreement), and Buyer's managing general partner is a Qualifying Section 501(c)(3) Organization. E. The Authority has approved (i) the transfer of the Project to Buyer, (ii) modification of the Regulatory Agreement to permit ownership by a limited partnership with a managing general partner that is a Qualifying Section 501(c)(3) Organization and (iii) modification of the Regulatory Agreement to incorporate the terns of the Freddie Mac Rider attached hereto. NOW, THEREFORE, Authority, Owner and Buyer declare, covenant and agree, in consideration of the mutual promises contained herein, and for other good and valuable consideration, as follows. I. Pursuant to Section 15 of the Regulatory Agreement, the Authority has determined that the Owner is not in default under the Regulatory Agreement and that the continued operation of the Project by Buyer will comply with the provisions of the Regulatory Agreement. The Authority hereby consents to the transfer of Project from Owner to Buyer. Concurrently with the execution of this Modification, Owner and Buyer shall execute an assignment and assumption agreement in a form approved by the City Attorney and record it in the Official Records of Riverside County, California. I Section 15(iii) of the Regulatory Agreement shall be deleted in its entirety and replaced with the following: "(iii) the purchaser or its assignee is a Qualifying Section 501(c)(3) Organization, or a limited partnership with a managing general partner that is a Qualifying Section 501(c)(3) Organization, and is willing and capable of complying with the terms and conditions ortbis Regulatory Agreement," 3. Section 15(iv) of the Regulatory Agreement shall be amended by deleting "purchaser or, assignee is a Qualified Section 501(c)(3) Organization" and replacing such text with "purchaser or assignee or its managing general partner is a Qualified Section 501(c)(3) Organization". 4. The Regulatory Agreement is amended to incorporate the terms and conditions of the Freddie Mac Rider attached hereto. 5. Except as otherwise provided herein, the Regulatory Agreement shall be and remain unmodified and in full force and effect. 6. This Modification may be executed in any number of counterparts each of which shall be an original but all of which shall constitute one and the same document. [SIGNATURES FOLLOW] Mod,ficaoon of RcSularory Agreement—Housing Authority 2 IN WITNESS WHEREOF, the parties have executed this Modification of Regulatory Agreement as of the date first above written. AUTHORITY: ATTEST: HOUSING AUTHORITY OF THE CITY OF PALM SPRINGS By. l-t-rYr.r.� �: Its:l��v�!' i �� vrr OWNER: CORPORATE FUND FOR HOUSING, a APPROVSCS AS TO FORM: California nonprofit public benefit corporation By: �`V�lz�- gY &/ /LIZ/ Its: C d c7 Title: ac.,Enear Z Madifintion of Regululory Agreemem—naacing Autlwmy 3 BUYER: TAHQUITZ ASSOCIATES,LP, a California limited parmersbip By: LINC-TAHQUITZ LLC, a California limited liability company Its: Managing General Partner By: LINC Housing Corporation, a California nonprofit public benefit corporation Its: Sole Member and Manager BY=- � Kent Davis Its: Senior Vice President By: TAHQUITZ ASSOCIATES,LLC, a California limited liability company Its: Co-Gencral Partner By: Dalton Hydra, LLC, a Vermont limited liability company Its: Manager By: S. R_ C. Corp., a Utah corporation Its: Manager By: Steve Harmsen Its: President Modification ofReglalory Ageemmz—Honcing Auzboriry 4 BUYER: TAHQUITZ ASSOCIATES, LP, a California limited partnership By: LINC-TAHQUITZ LLC, a California limited liability company Its: Managing General Partner By: LINC Housing Corporation, a California nonprofit public benefit corporation Its: Sole Member and Manager By: Kent Davis Its: Senior Vice President By: TAHQUITZ ASSOCIATES, LLC, a California limited liability company Its: Co-Gencral Partner By: Dalton Hydro, LLC, a Vermont limited liability company Its: Manager By: S. R. C. Corp., a Utah corporation Its: Manager By: `- Steve Harmsen Its: President Modification of Regulatory Agrcenicn[—Housing Authority 4 ACKNOWLEDGMENT State of California ) )ss. County of ) ,11 I I A I ? f On J` e —_ _W �I 2od9/ before me, l ?cc.Ioe & A DGkn S A ai-KrH dabbrc - I (insert name and title of the fficer) personally appeared _4 )"'j,s , who proved to me on the basis of satisfactory evidence to be the person�."hose namej(s is/are subscribed to the within instrument and acknowledged to me that he/sheltj}erexecuted the same in his[her/Sbeir authorized capacity and that by his/perjtJaetr signature(s) an the Instrument the persor�or the entity upon behalf of which the persoo(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. ER.waeTN w IS WITNESS my hand and official seal. COMMI$SRON 5 Iftalz Z Nwaty pubic-CaNI 0 ORANGE COUNTY Signature Yy Cantu.eww Aim n.»T1 (Seal) State of California ) )ss. County of ( r t /)� � / , r �" /J I On 7 before me, leyWlkiI4 A• ( �/aLK,/VQ/w fC/bb,l nn (insert name and title of the o Icer) personally appeared 1)pdi4 Q- and 3AmY S w 50"1 who proved to me on the basis of satisfactory evidence o be the person s)whose name(s))c re subscribed to the within Instrument and acknowled ed to me that F e/q'l9 the executed the same in Gtts/fye thelr uthorized capacity(ies), and that by 11*/htlgrgLe. 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. CYNINIA A.IEkMDI WITNESS my hand and official seal- 3 Commlialon� 164fipgq Notary PUNT-Coulomb ftetalae County Signature MY Cam-EWMm Feb 1 a,2010 (Seal) Modificuuon oFRegulutory Agreement-Housing nuthonry J State of California ) )ss County of ) On before me, (insert name and title of the officer) 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/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. 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. Signature (Seal) State of Via- ) )ss. County of / / On 0eG- 0� 2'6 _before me, IAA- G G.,I.. ( 4 l� (insert name and title of the officer personally appeared STC= L) N (�? &VL C e N 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/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s)on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. t WITNESS my hand and official seal. G � �Pj�otK E Signature - �,ninee9pU't�SSgS4\ ti Gp1ti���e�,� tm ca^' (Seal) Modification of Regulatory Agreement—Housing Aulhurity 6 EXHIBIT A LEGAL DESCRIPTION LOT 15 IN SECTION 13, TOWNSHIP 4 SOUTH, RANGE 4 EAST, SAN BERNARDINO MERIDIAN, AS PER MAP OF PALM VALLEY COLONY LANDS, IN THE CITY OF PALM SPRINGS, COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, RECORDED IN BOOK 14, PAGE 652 OF MAPS SAN DIEGO COUNTY RECORDS. EXCEPT THE PORTION LYING NORTH OF THE SOUTH LINE OF ENCHANTED HOMES UNIT NO. 1, RECORDED IN BOOK 34. PAGE 17 OF MAPS, RIVERSIDE COUNTY RECORDS. SAID PROPERTY IS SHOWN ON RECORD OF SURVEY ENTITLED 'RECORD OF SURVEY OF A PORTION OF LOT 1 OF SECTION 13, TOWNSHIP 4 SOUTH, RANGE 4 EAST, SAN BERNARDINO MERIDIAN, AS SHOWN BY MAP OF PALM VALLEY COLONY LANDS, AS RECORDED IN BOOK 14 PAGE 652 OF MAPS, SAN DIEGO COUNTY RECORDS" ON FILE IN BOOK 33, PAGE 77, RECORDS OF SURVEY, RIVERSIDE COUNTY RECORDS. APN: 502-143-004-5 Modircanon of Regulatory Agmcmcnr—Housing Authority 7 FREDDIE MAC RIDER TO REGULATORY AGREEMENT REGULATORY AGREEMENT AND DECLARATION OF RESTRICTIVE COVENANTS THIS FREDDIE MAC RIDER TO REGULATORY AGREEMENT AND DECLARATION OF RESTRICTIVE COVENANTS ("Rider"), executed as of /M c is , 2008 is deemed attached to and to form a part of the Regulatory Agreement and Declaration of Restrictive Covenants (the "Regulatory Agreement"), dated as of September 1, 1993[, as amended], by and between TANQUITZ ASSOCIATES, LP, a California limited partnership, as successor to Corporate Fund For Housing, a California nonprofit public benefit corporation ("Owner"), its successors and assigns, and THE HOUSING AUTHORITY OF THE CITY OF PALM SPRINGS, a housing authority of the State of California("Authority"). l. Definitions. All capitalized terms used in this Rider have the meanings given to those terms in the Regulatory Agreement. 2. Applicability. This Rider shall amend and supplement the Regulatory Agreement. In the event any provision of this Rider conflicts with the Regulatory Agreement, the Rider shall supersede the conflicting provision of the Regulatory Agreement. This Rider shall apply in spite of the fact that the covenants, reservations and restrictions of the Regulatory Agreement run with the land and shall be deemed applicable to any successor in interest to the Owner. 3. Obligations Not Secured by the Project. The payment and performance obligations of the Owner and any subsequent owner of the Project under the Regulatory Agreement shall not be secured by or constitute a security interest in the Project. The occurrence of an event of default under the Regulatory Agreement shall not defeat or render invalid the lien of the Multifamily Deed of Trust, Assignment of Rents, Security Agreement and Fixture Filing executed by the Owner for the benefit of Capmark Bank ("CapmarW), dated as of / 1 2008 ("Security Instrument"), as assigned of even date therewith from Capmark to the Federal Home Loan Mortgage Corporation ("Freddie Mac"). For purposes of this Rider, Capmark and Freddie Mac, individually and together, are "Lender". 4. Obligations Personal. The Authority agrees that no owner of the Project (including Lender) subsequent to the Owner will be liable for, assume or take title to the Project subject to: (a) any failure of any prior owner of the Project to perform or observe any representation or warranty, affirmative or negative covenant or other agreement or undertaking under the Regulatory Agreement; and (b) the payment of any compensation or any accrued unpaid fees, costs, expenses or penalties otherwise owed by any prior owner of the Project under the Regulatory Agreement_ The Owner and each subsequent owner of the Project shall be responsible under the Regulatory Agreement only for its own acts and omissions occurring during the period of its ownership of the Project. All such liability and obligations shall Initials`Juthority / Owner / Buyer Modi£oatian oCRegulalury Agr�oFr How4ing Autboiry—Freddie Mac Rider 1 FREDDIE MAC RIDER TO REGULATORY AGREEMENT REGULATORY AGREEMENT AND DECLARATION OF RESTRICTIVE COVENANTS THIS FREDDIE MAC RIDER TO REGULATORY AGREEMENT AND DECLARATION OF RESTRICTIVE COVENANTS ("Rider"), executed as of y j� 2008 is deemed attached to and to form a part of the Regulatory Agreement and Declaration of Restrictive Covenants (the "Regulatory Agreement"), dated as of September 1, 1993[, as amended], by and between TAHQI)ITZ ASSOCIATES, LP, a California limited partnership, as successor to Corporate Fund For Housing, a California nonprofit public benefit corporation ("Owner"), its successors and assigns, and THE HOUSING AUTHORITY OF THE CITY OF PALM SPRINGS, a housing authority of the State of California("Authority"). 1. Definitions. All capitalized terms used in this Rider have the meanings given to those terms in the Regulatory Agreement. 2. Applicability. This Rider shall amend and supplement the Regulatory Agreement. In the event any provision of this Rider conflicts with the Regulatory Agreement, the Rider shall supersede the conflicting provision of the Regulatory Agreement, This Rider shall apply in spite of the fact that the covenants, reservations and restrictions of the Regulatory Agreement run with the land and shall be deemed applicable to any successor in interest to the Owner. 3, Obligations Not Secured by the Project. The payment and performance obligations of the Owner and any subsequent owner of the Project tinder the Regulatory Agreement shall not be secured by or constitute a security interest in the Project. The occurrence of an event of default under the Regulatory Agreement shall not defeat or render invalid the lien of the Multifamily Deed of Trust, Assignment of Rents, Security Agreement and Fixture Filing executed by the Owngr for the benefit of Capmark Bank ("Capmark"), dated as of r I.—_J , 2008 ("Security Instrument'), as assigned of even date therewith from Capmark to the Federal Dome Loan Mortgage Corporation ("Freddie Mac"). For purposes of this Rider, Capmark and Freddie Mac, individually and together, are"Lender". 4. Obligations Personal. The Authority agrees that no owner of the Project (including Lender) subsequent to the Owner will be liable for, assume or take title to the Project subject to: (a) any failure of any prior owner of the Project to perform or observe any representation or warranty, affirmative or negative covenant or other agreement or undertaking under the Regulatory Agreement, and (b) the payment of any compensation or any accrued unpaid fees, costs, expenses or penalties otherwise owed by any prior owner of the Project under the Regulatory Agreement. The Owner and each subsequent owner of the Project shall be responsible under the Regulatory Agreement only for its own acts and omissions occurring during the period of its ownership of the Project. All such liability and obligations shall fnitials Authority / Owner / yer Modification of Regulatory Agreement—Housing Authority—rreddm Moe Rider I be and remain personal to such person even after such person ceases to be the owner of the Project. 5. Foreclosure/Deed in Lieu of Foreclosure. All provisions of Section 15 of the Regulatory Agreement related to the sale or transfer of the Project which require the consent of the Authority or transfer agreements, compliance with Authority transferee criteria and requirements, opinion requirements, assumption fees, transfer fees, shall not apply to any transfer of title to the Project to Lender and/or a nominee thereof by foreclosure or deed in lieu of foreclosure or to any third party purchaser from Lender and/or a nominee thereof at or subsequent to foreclosure or deed in lieu of foreclosure, and there shall be no reversion of title to Owner by reason of any such transfer. Nothing contained in the Regulatory Agreement shall affect any provision of the Security Instrument or any of the other Loan Documents (as defmcd in Security Instrument) which requires the Owner to obtain the consent of Lender as a precondition to sale, transfer or other disposition of, or any direct or indirect interest in, the Project or of any direct or indirect interest in the Owner. No covenant obligating the Owner to obtain an agreement from any transfcrce to abide by all requirements and restrictions of the Regulatory Agreement shall apply to a transfer to Lender and/or a nominee thereof upon foreclosure or deed in lieu of foreclosure. For purposes of Section 16 of the Regulatory Agreement, a foreclosure or delivery of a deed in lieu of foreclosure under the Security Instrument shall be deemed a foreclosure of the lien of the "Credit Bank" and "Project Mortgage" such that the terms of the Regulatory Agreement shall terminate and be of no further force and effect- 6- Damage, Destruction or Condemnation of the Project. In the event that the Project is damaged or destroyed or title to the Project, or any part thereof, is taken through the exercise or the threat of the exercise of the power of eminent domain, the Owner shall comply with all applicable requirements of the Security Instrument and the applicable requirements of the Security Instrument shall control over any conflicting provision of the Regulatory Agreement. In furtherance, and not in limitation of the foregoing,Lender shall have the sole right to determine, in accordance with the standards set forth in the Security Instrument, whether insurance or condemnation proceeds are to be applied to restore the Project (and to approve the plans and specifications in connection with any such restoration)or to prepay indebtedness_ 7. Regulatory Agreement Default. Notwithstanding anything contained in the Regulatory Agreement to the contrary: a. The occurrence of an Event of Default under the Regulatory Agreement shall not defeat or render invalid the lien of the Security Instrument. b_ The occurrence of an Event of Default under the Regulatory Agreement shall not be or be deemed to be a default under the Loan Documents, except as may be otherwise specified in the Loan Documents- 8- Rider Provisions Control. The provisions of this Ridcr shall govern and control with respect to the matters set forth herein, regardless of whether, pursuant to Section 29 of the Regulatory Agreement, the rent and income restrictions of the "Agency Regulatory Agreement" defined in Section 29 control due to an inconsistency between the two Agreements. Initials Authority / ti 1� Owner / Buyer Modification of Regulatory Agreemenr—Howinr Authority—Freddie Mac Rider 2 be and remain personal to such person even after such person ceases to be the owner of the Project. 5. Foreclosure/Deed in Lieu of Foreclosure. All provisions of Section 15 of the Regulatory Agreement related to the sale or transfer of the Project which require the consent of the Authority or transfer agreements, compliance with Authority transferee criteria and requirements, opinion requirements, assumption fees, transfer fees, shall not apply to any transfer of title to the Project to Lender and/or a nominee thereof by foreclosure or deed in lieu of foreclosure or to any third party purchaser from Lender and/or a nominee thereof at or subsequent to foreclosure or deed in lieu of foreclosure, and there shall be no reversion of title to Owner by reason of any such transfer. Nothing contained in the Regulatory Agreement shall affect any provision of the Security Instrument or any of the other Loan Documents (as defined in Security Instrument) which requires the Owner to obtain the consent of Lender as a precondition to sale, transfer or other disposition of, or any direct or indirect interest in, the Project or of any direct or indirect interest in the Owner. No covenant obligating the Owner to obtain an agreement from any transferee to abide by all requirements and restrictions of the Regulatory Agreement shall apply to a transfer to Lender and/or a nominee thereof upon foreclosure or deed in lieu of foreclosure. For purposes of Section 16 of the Regulatory Agreement, a foreclosure or delivery of a deed in lieu of foreclosure under the Security Instrument shall be deemed a foreclosure of the lien of the "Credit Bank" and "Project Mortgage" such that the terms of the Regulatory Agreement shall terminate and be of no further force and effect. 6. Damage, Destruction or Condemnation of the Project. In the event that the Project is damaged or destroyed or title to the Project, or any part thereof, is taken through the exercise or the threat of the exercise of the power of eminent domain, the Owner shall comply with all applicable requirements of the Security Instrument and the applicable requirements of the Security Instrument shall control over any conflicting provision of the Regulatory Agreement. In furtherance, and not in limitation of the foregoing, Lender shall have the sole right to determine, in accordance with the standards set forth in the Security Instrument, whether insurance or condemnation proceeds are to be applied to restore the Project (and to approve the plans and specifications in connection with any such restoration) or to prepay indebtedness. 7. Regulatory Agreement Default. Notwithstanding anything contained in the Regulatory Agreement to the contrary: a- The occurrence of an Uvent of Default under the Regulatory Agreement shall not defeat or render invalid the lien of the Security Instrument. b. The occurrence of an Event of Default under the Regulatory Agreement shall not be or be deemed to be a default under the Loan Documents. except as may be otherwise specified in the Loan Documents. S. Rider Provisions Control. The provisions of this Rider shall govern and control with respect to the matters set forth herein, regardless of whether, pursuant to Section 29 of the Regulatory Agreement, the rent and income restrictions of the "Agency Regulatory Agreement" defined in Section 29 control due to an inconsistency between the two Agreements. Initials:: Authority / Owner / �lu yer Modification of RcGulntory Agreeluca Housing Authority—Freddie Mac RTdcr 2 DOC # 2008-0663042 12/19/2008 08:00Aa Fee:42.00 e I of Rccardcci inoff Riverside aords county Larry usessor, county- Ward der FREE RECORDING REQUESTED BY a II�IIIIIIIIIIIIIIIIIIIIAII�llllllllll lllllllllllll AND WHEN RECORDED MAIL TO: III�I City Clerk 5 R U PAGE SIZC OA M15C LONG RFD COPY City of Pahn Springs a q PO Box 2743 A 465 426 PCOR NCpFi SMF NCHG Palm Springs, CA 92263 �I T: cry I UNl ASSIGNMENT AND ASSUMPTION OF LOAN DOCUMENTS r This ASSIGNMENT AND ASSUMPTION OF LOAN DOCUMENTS (this 057 "Agreement") is effective as of I 'S —, 2008 ("Effective Date") among CORPORATE FUND FOR HOUSING, a California nonprofit public benefit corporation ("Assignor"), TAHQUITZ ASSOCIATES, LP, a California limited partnership ("Assignee"), and THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS. CALIFORNIA, a public body corporate and politic ("Agency"). RECITALS A. Assignor is the owner of 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 ("Property"). B. Agency made a $590,000 loan to Assignor (the "Loan"), as evidenced by a Promissory Note Secured by Deed of Trust dated September 28, 1993 ("Note"). C. Assignor and Agency entered into a Regulatory Agreement and Declaration of Restrictive Covenants dated September 28, 1993, recorded September 30, 1993, in the Official Records of Riverside County, California as Instrument No. 382201 ("Regulatory Agreement"), which provides for certain terms, conditions, covenants and restrictions relating to a low income multi-family housing project located on the Property. D. The Loan is secured by a Deed of Trust with Assignment of Rents, Security Agreement and Fixture Filing dated September 28, 1993, recorded September 30, 1993, in the Official Records of Riverside County, California as Instrument No. 382205 ("Deed of Trust"), The Note, Regulatory Agreement Deed of Trust and all other documents evidencing or securing the Loan are referred to herein as the "Loan Documents". E. Assignor desires to transfer the Project (as defined in the Loan Documents) to Assignee with the consent of Agency. R Assignor desires to assign the Loan Documents to Assignee, and Assignee desires to accept such assignment and assume the obligations of Assignor under the Loan Documents. Assignment and Assumption(Forgivable Loan)(00183262)-Final 2 1 AGREEMENT NOW, THEREFORE, the parties mutually agree as follows: I. Assignment of Loan Documents. Assignor hereby assigns to Assignee all of Assignors right, title and interest in and obligations under all the Loan Documents as of the Effective Date. 2. Acceptance of Assignment: Assumption of Obligations- Assignee hereby accepts the assignments set forth in Section 1 and hereby assumes, agrees and undertakes to perform all of the obligations, covenants and agreements of Assignor pursuant to the Loan Documents arising from and after the Effective Date. 3. Aaencv Consent. Pursuant to Section 8 of the Note, Section 5.1 1(b) of the Deed of Trust and Section 6-2 of the Regulatory Agreement, Agency consents to the transfer of the Project and assignment of the Loan Documents to Assignee. Agency hereby releases Assignor from all obligations under the Loan Documents arising on or after the Effective Date. 4. Representation$. Assignor hereby represents and warrants that it has not previously assigned, pledged, hypothecated or otherwise transferred any of its rights under the Loan Documents. 5. Subsequent Agreements. Assignor and Assignee agree to enter into all additional documentation necessary to reflect or memorialize the assignments and assumptions described in this Agreement. 6. Counterparts. This Agreement may be executed in counterparts. each of which shall be an original and all of which shall constitute the same instrument. [SIGNATURES ON FOLLOWING PAGE] Assignment and Assumption(Forgivable Loan)(001 H3262)•Fina1 2 2 IN WITNESS WHEREOF, the parties have executed this Assignment and Assumption of Loan Documents as of the date first written above- ASSIGNOR- CORPORATE FUND FOR HOUSING, a California nonprofit public benefit corporation By: If r L Its: Cad ASSIGNEE: TAHQUITZ ASSOCIATES, LP, a California limited partnership By: LILAC-TAHQUITZ LLC, a California limited liability company Its: Managing General Partner By.LINC Housing Corporation, a California nonprofit public benefit corporation Its: Sole Member and Manager l By:_ �G Kent DavisL Its: Senior Vice President By: TAHQUITZ ASSOCIATES,LLC, a California limited liability company Its: Co-General Partner By:Dalton Hydro,LLC, a Vermont limited liability company Its: Manager By: S. R. C. Corp_, a Utah corporation Its: Manager By: Steve Harmsen Its: President Assigammt end Assumption(Forgivable Lone)(00M262)-Final 2 IN WITNESS WHEREOF, the parties have executed this Assignment and Assumption of Loan Documents as of the date first written above. ASSIGNOR: CORPORATE FUND FOR HOUSING, a California nonprofit public benefit corporation By: Its: ASSIGNEE: TAHQUITZ ASSOCIATES, LP, a California limited partnership By: L1NC-TAHQUiTZ LLC, a California limited liability company Its: Managing General Partner By: I.INC Housing Corporation, a California nonprofit public benefit corporation Its: Sole Member and Manager By: Kent Davis Its: Senior Vice President By: TAHQUITZ ASSOCIATES, LLC, a California limited liability company Its: Co-Gencral Partner By: Dalton Hydro, LLC, a Vermont limited liability company Its: Manager By: S. R. C. Corp., a Utah corporation Its: Manageer. 'Steve C Steve 1-tarmsen Its: President ASmgnmenr and Assumption(Forgivable Loan)(00183262)-anal 2 AGENCY: ATTEST: THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA �•1L11 11 By-�J�� ��-- Its: APPROVED AS TO FORM: By Z&X_�a Title: L pGfk�SG� i+.t.R:,. Assignment and Assumppon(Forgivable Lunn)(00I U262)-Final 2 State of California ) County of p ) 7 n lJ On_1Jl t�n oe�/�� before me, S l;c (insert name and title of the offac ) personally appeared who proved to me on the basis of satisfactory evidence to be the persorlKwhose name(<is/are- subscribed to the within instrument and acknowledged to me that he/sheliheytxecuted the same in hiskKTfteir uthorized capacityFiesT, and that by his/hcr/11ert signature(s) on the instrument the persovW, or the entity upon behalf of which the persou(&)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. EUUBETHA GAvlS WITNESS my hand and official seal. 'a coMulssioN M tMxez £ Namry RliGc C�fkml� � p1UxGE Cd1MrY � YOH Signature &L ;ZZ� V711r (Seal) Assignment and Assumption(Forgivable Loan)(00133262)-Final 2 State of ' )ss. County of_ On eC Slr -00 a/� ` before me, h1t iG e / (insert name and title the officer) J personally appeared <ne v _ (. i w4i 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/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. 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- ��I Ee L dF-�1 l IV .f snreoru ` Signature x 9 69 E.SOUTHu °PLF a o2 1, GoMM, P (Seal) Assignment and Assumption(fogpvablc Loin)(00187262)-Final 2 State of California ) )g5. County of fdj— ) On 90 before me, & n w, A. 6A , NAM /f yIlG p n (insert name and title of the officer) personally appeared Dgid a. 6 t yQ �� � nc(JSpvt who proved to me on the basis of satisfactory evidence to be the persons) whose name(s) ids re subscribed t the within instrument and acknowledged to m thee that jk/*e executed the same in *lrar ci authorized capacity(ies), and that by 1)6/15bt then 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. CYNTWw A.BEPARn1 Commisalon# 1645699 WITNESS my hand and official seal. O No1ary r�nnc-cautvmla s Rini-Excle County wCorry Signature (Seal) Asvgnmcm and Assumption(Forgivable 1-oan)(00183262)-Find]2 FXH113IT A DESCRIPTION OF THE, PROPERTY LOT 15 IN SECTION 13, TOWNSHIP 4 SOUTH, RANGE 4 EAST, SAN BERNARDINO MERIDIAN, AS PER MAP OF PALM VALLEY COLONY LANDS, IN THE CITY OF PALM SPRINGS, COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, RECORDED IN BOOK 14, PAGE 652 OF MAPS SAN DIEGO COUNTY RECORDS. EXCEPT THE PORTION LYING NORTH OF THE SOUTH LINE OF ENCHANTED HOMES UNIT NO. 1, RECORDED IN BOOK 34, PAGE 17 OF MAPS, RIVERSIDE COUNTY RECORDS. SAID PROPERTY IS SHOWN ON RECORD OF SURVEY ENTITLED "RECORD OF SURVEY OF A PORTION OF LOT 1 OF SECTION 13, TOWNSHIP 4 SOUTH, RANGE 4 EAST, SAN BERNARDINO MERIDIAN, AS SHOWN BY MAP OF PALM VALLEY COLONY LANDS, AS RECORDED IN BOOK 14, PAGE 6S2 OF MAPS SAN DIEGO COUNTY RECORDS' ON FILE IN BOOK 33, PAGE 77, RECORDS OF SURV ff. RIVERSIDE COUNTY RECORDS. APN; 502-143-004-5 Aswgnmcnt and Assumption(Forgivable Loan)(00193262)-Final; DOG # 2008-0663043 12/19/2008 08:00A Fee:39,00 Page 1 of S Recorded in Official Records Country of Riverside Larry W. Ward rissessor, County Clerk & Recorder FREE RECORDING REQUESTED BY I IIIIII�II�III III IIIII�IIIIII III IIIIIII III IIIII IIII IN AND WHEN RECORDED MAIL TO: City Clerk S R U PAGE SIZE DA MISC LONG RFD COPY City of Palm Springs a PO Box 2743 Palm Springs, CA 92263 / A L 465 476 PCOR NCOR SMF NCHG ExAM V T. CTY UNI �I ASSIGNMENT AND ASSUMPTION OF REGULATORY AGREEMENT (a) T 051 This ASSIGNMENT AND ASSUMPTION OF REGULATORY AGREEMENT (this "Agreement') is dated as of —�ECEMf_VA 15 , 2008 ("Effective Date") between CORPORATE FUND FOR HOUSING, a California nonprofit public benefit corporation ("Assignor") and TAI-IQUITZ ASSOCIATES, LP, a California limited partnership ("Assignee"). RECITALS A. Assignor is the owner of 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 ("Property")- B. Assignor and the Housing Authority of the City of Palm Springs ("Authority") entered into a Regulatory Agreement and Declaration of Restrictive Covenants dated September 1, 1993, recorded September 30, 1993, in the Official Records of Riverside County, California as Instrument No. 382200 ("Original Regulatory Agreement"), which provides for certain terms, conditions, covenants and restrictions relating to a low income multi-family housing project located on the Property. C. Assignor desires to transfer the Project (as defined in the Original Regulatory Agreement) to Assignee- D. Concurrently with the execution of this Agreement, Assignor, Assignee and Authority are entering into a Modification of Regulatory Agreement dated as of the Effective Date ("Modification") to be recorded in the Official Records of Riverside County, California, which includes the consent of the Authority to the transfer the Project to Assignee. The Original Regulatory Agreement together with the Modification are referred to herein as the "Regulatory Agreement". E- Assignor desires to assign the Regulatory Agreement to Assignee, and Assignee desires to accept such assignment and assume the obligations of Assignor under the Regulatory Agreement. F. The Modification requires that the City Attorney of the City of Palm Springs approve the form ofthis Agreement. Assiymmcnt end Assumption(Bond Regulatory)(00183261)I -Final 2 I AGRF.EMF.NT NOW, TI-IEREFORE, the parties mutually agree as follows: 1. Assignment of Assigned Assets. Assignor hereby assigns to Assignee all of Assignor's right, title and interest in and obligations under all the Regulatory Agreement as of the Effective Date- 2. Acceptance of Assignment Assumption of Obligations. Assignee hereby accepts the assignments set forth in Section 1 and hereby assumes, agrees and undertakes to perform all of the obligations, covenants and agreements of Assignor pursuant to the Regulatory Agreement arising from and after the Effective Date. 3. Representations_ Assignor represents and warrants that it has not previously assigned, pledged, hypothecated or otherwise transferred any of its rights under the Regulatory Agreement. 4. Subsequent Agreements. Assignor and Assignee agree to enter into all additional documentation necessary to reflect or memorialize the assignments and assumptions described in this Agreement. 5. City Approval. Pursuant to Section I of the Modification, the City Attorney of the City of Palm Springs has approved the form of this Agreement. 6. Counterparts. This Agreement may be executed in counterparts, each of which shall be an original and all of which shall constitute the same instrument. [SIGNATURES ON FOLLOWING PAGE] Assignment and Assumption(bond Regulatory)(00183261)1 -Final 2 2 IN WITNESS WHEREOF,the parties have executed this.Assignment and Assumption of Regulatory Agreement as of the date first written above. ASSIGNOR: CORPORATE FUND FOR HOUSING, a California nonprofit public benefit corporation By: /E' Its: �P+G a a ASSIGNEE: TAHQUITZ ASSOCIATES, LP, a California limited partnership By: LINC-TAHQUITZ LLC, a California limited liability company Its: Managing General Partner By: LINC Housing Corporation, a California nonprofit public benefit corporation Its: Sole Member and Manager 04�By: IL- Kent Davis Its: Senior Vice President By: TAHQUITZ ASSOCIATES,LLC, a California limited liability company Its: Co-General Partner By:Dalton Hydro,LLC, a Vermont limited liability company Its: Manager By: S.R_ C. Corp., a Utah corporation Its: Manager By: Steve Harmsen R Its:President Assienmwi and Assompdon(Bond Regolntory)(00M261)l-Final 2 IN WITNESS WHEREOF, the parties have executed this Assignment and Assumption of Regulatory Agreement as of the date first written above- ASSIGNOR: CORPORATE FUND FOR HOUSING, a California nonprofit public benefit corporation By: Its: ASSIGNEE: TAHQUITZ ASSOCIATES, LP, a California limited partnership By: LILAC-TAHQUITZ LLC, a California limited liability company Its: Managing General Partner By: LINC Housing Corporation, a California nonprofit public benefit corporation Its: Sole Member and Manager By: Kent Davis Its: Senior Vice President By: TAHQUITZ ASSOCIATES, LLC, a California limited liability company Its: Co-Gencral Partner By: Dalton Hydro, LLC, a Vermont limited liability company Its: Manager By: S. R. C. Corp., a Utah corporation Its: Manager J/ r By:, Steve armsen Its: President Assignment and Assumption(Bond Regulatory)(0010261)I-Final 2 Anniroved as to By: /w!'vv 4tyrney, City of Palm Springs Assignment and Assumption(Bond Regulatory)(00181261)1 -Final 2 ACKNOWLEDGMENT State of California ) )ss County of ) 1 - On ��'eEwti�w—� Z6a� before me, �12�•17� A• DGvNS ,�/�le.C—l�. (insert name and itle of the o ficer) personally appeared � A"•,S ,who proved to me on dtc basis of satisfactory evidence to be the persoa(s hose names)is/Arz subscribed to the within instrument and acknowledged to nle that he[she/thep-executcd the same in his/he,[[ueir-authorized capacity(iesr and that by hislNe hcil signature(s)on the instrument the perso�t(s3,or the entity upon behalf of which the persolli(STacted, 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. WITNES4myy d official seal. EuzAaerr•ruvis/ courelWION a 174M20z n Notary Pubic-CaMbrnnla =aruNclEwuNnSiignaaturr MYCC E�"Aus M•ptr 'N (Seal) State of California ) )ss. County of ) On before me, (insert name and title of the officer) personally appeared ,who proved to me on the basis of satisfactory evidence to be the person(s)whose nanie(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capaciry(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. 1 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. . Signature (Seal) Assignment and Assumption(Bond Reguluwry)(00193261)1-1 mal 2 � n V State of 46 � ) )ss. County On�( t�� �y-Rz _before me, tx+ W-.- (�-1,�.1,_.1 (insert name and title of h officer) / personally appeared S=e-U r? who proved to me on the basis of satisfactory evidence to be the penson(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(ics),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. OVlTNESS my hand and official s f �0p J6 YG STpTcOF tiTA a 469 E.STI,UT 02 cm+ V Signature �iSM m p.tTlzafzott 1 F, (Seal) AssiSnmcnt and Assumption(Bond Regulatory)(00183261)1 .Final 2 EXHIBIT A. DESCRIPTION OF TIIE PROPERTY LOT 15 IN SECTION 13, TOWNSHIP 4 SOUTH, RANGE 4 EAST, SAN BERNARDINO MERIDIAN, AS PER MAP OF PALM VALLEY COLONY LANDS, IN THE CITY OF PALM SPRINGS, COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, RECORDED IN BOOK 14. P_A_GE 652 OF MAPS. SAN DIEGO COUNTY RECORDS. EXCEPT THE PORTION LYING NORTH OF THE SOUTH LINE OF ENCHANTED HOMES UNIT NO. 1, RECORDED IN BOOK 34, PAGE 97 OF MAPS, RIVERSIDE COUNTY RECORDS. SAID PROPERTY IS SHOWN ON RECORD OF SURVEY ENTITLED "RECORD OF SURVEY OF A PORTION OF LOT 1 OF SECTION 13, TOWNSHIP 4 SOUTH, RANGE 4 EAST, SAN BERNARDINO MERIDIAN, AS SHOWN BY MAP OF PALM VALLEY COLONY LANDS, AS RECORDED IN BOOK 14 PAGE 652 OF MAPS SAN DIEGO COUNTY RECORDS" ON FILE IN BOOK 33, PAGE 77, RECORDS OF,SURVEY. RIVERSIDE COUNTY RECORDS. APN: 502-143-004-5 Assignment and Assumption(Bond Rcgulatory)(00183761)1 •Final CMCAGG TITLE CO. FREE RECORDING REQUESTED BY it 0 m ._ AND WHEN RECORDED RETURN TO: c THE COMMUNITY REDEVELOPMENT AGENCY Q g aUj OF THE CITY OF PALM SPRINGS, CALIFORNIA y H o X 3200 East Tahquitz-Canyon Way W a $ w M Palm Springs, CA 92262 L o m L Attn: Executive Director Uj o O 00 (Space Above This Line For Recorder's office Use Only M Q, •.- + n O m F + u z s. b w i 4- W CERTIFICATE OF COMPLETION o— w O � W V S- L K N O N C7 X U U Q W WHEREAS, by a Housing Rehabilitation Agreement (hereinafter referred to as the "Agreement") dated , 1993, by and between THE COMMUNITY REDEVELOPMENT AGENCYv OF THE CITY OF PALM SPRINGS, CALIFORNIA (hereinafter referred to as "Agency") , and CORPORATE FUND FOR HOUSING, a California nonprofit public benefit corporation, (hereinafter referred to as "Participant") , Participant has redeveloped the real property (the "Site") , legally described on Exhibit 1 attached hereto and incorporated herein by reference, according to the terms and conditions of said Agreement; and WHEREAS, pursuant to Section 4 . 10 of the Agreement, promptly after completion of all construction work to be completed by Participant upon the Site, and upon request by Participant, Agency shall furnish Participant with a Certificate of Completion in such form as to permit it to be recorded in the official Records of the County of Riverside; and WHEREAS, the issuance by Agency of the Certificate of Completion shall be conclusive evidence that Participant has complied with the terms of the Agreement pertaining to the redevelopment of the Site; and WHEREAS, Participant has requested that Agency furnish Participant with the Certificate of Completion; and WHEREAS, Agency has conclusively determined that the redevelopment of the Site has been satisfactorily completed as required by the Agreement; and FS21383\014084-0012\2035998.1 07/28/93 • 38220'7 r WHEREAS, the Agreement provided for certain covenants to run with the land, which covenants were incorporated in a Regulatory Agreement and Declaration of Covenants and Restrictions (the "Regulatory Agreement") ; NOW, THEREFORE: 1. As provided in the Agreement, Agency does hereby certify that redevelopment of the Site has been fully and satisfactorily performed and completed, and that such redevelopment is in full compliance with said Agreement. 2 . This Certificate shall not constitute evidence of Participant's compliance with the Regulatory Agreement, the provisions of which shall continue to run with the land. 3 . This Certificate of Completion shall not constitute evidence of compliance with or satisfaction of any obligation of Participant to any holder of a mortgage, or any insurer of a mortgage, securing money loaned to finance construction work on the Site, or any part thereof. Nothing contained herein shall modify in any way any other provision of said Agreement. 4 . This Certificate is not a Notice of Completion as referred to in California Civil Code Section 3093 . 5. Except as stated herein, nothing contained in this instrument shall modify in any way any other provisions of the Agreement or any other provisions of the documents incorporated therein. IN WITNESS WHERE F, Agency has executed this Certificate as of this 2 $* day of " r , 199J. THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS L A G By Exe ti Dir ctor -2- FS2\383\014084-0012\2035998.1 07/28/93 • 38`L20'7 STATE OF CALIFORNIA ) ss. COUNTY OF On I 1993 , before me c r 1-1i11jZ 4 . personally appeared personally known to me-For-proved tome-on the—bas-is --f—s-a-tisf-actor_y-ev- de_nce) to be the person(') whose name ( ) 1/are ubscribed to the within instrument and acknowledged to me that %she/they executed tote same in li )/her/their authorized capacity(-2e�s1 , and that by js�her/their signature(P) on the instrument the person(,4) , or the entity upon behalf of which the person(P) acted, executed the instrument. WITNESS my hand and official seal. ,r7l : `sV_ Notary Public (SEAL) OFFICIALNOTARY>EAL I, C-Lu1NE L SCHbt%AHrz / Nolary Publir.—CnhPoirna III „i'}�'fak6 fylV[RSIf,7F C;OI I�rry " 'o.1ns„y,G1°rr� -xNvas -Cb alb %Ut- IC -3- FS213831014084-001212035998.1 07/28/93 38220'7 EXHIBIT "1" DESCRIPTION OF PROPERTY That certain real property located in the County of Riverside, State of California, legally described as follows: LOT 15 IN SECTION 13 , TOWNSHIP 4 SOUTH, RANGE 4 EAST, SAN BERNARDINO MERIDIAN, AS PER MAP OF PALM VALLEY COLONY LANDS, RECORDED IN BOOK 14 , PAGE 652 OF MAPS, SAN DIEGO COUNTY RECORDS; EXCEPT THAT PORTION LYING NORTH OF THE SOUTH LINE OF ENCHANTED HOMES UNIT NO. 1, RECORDED IN BOOK 34, PAGE 17 OF MAPS, RIVERSIDE COUNTY RECORDS. SAID PROPERTY IS SHOWN ON RECORD OF SURVEY ENTITLED "RECORD OF SURVEY OF A PORTION OF LOT 15 OF SECTION 13 , TOWNSHIP 4 SOUTH, RANGE 4 EAST, SAN BERNARDINO MERIDIAN, AS SHOWN BY MAP OF PALM VALLEY COLONY LANDS AS RECORDED IN BOOK 14, PAGE 652 OF MAPS, SAN DIEGO COUNTY RECORDS" ON FILE IN BOOK 33 , PAGE 77 OF RECORDS OF SURVEY, RIVERSIDE COUNTY RECORDS. SAID LAND IS LOCATED IN THE CITY OF PALM SPRINGS. EXHIBIT 11111 F51\383\0140840012\51195.1 07/23/93 `R- DO NOT DESTROY THIS NOTE: When paid, this Note, with the Deed of Trust securing same, must be surrendered to Trustee for cancella- tion before reconveyance will be made. PROMISSORY NOTE SECURED BY DEED OF TRUST $590, 000 . 00 29 , 7.993 6!&e ifornia FOR VALUE RECEIVED, the undersigned ( "Maker" ) hereby promises to pay to THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA, public body, corporate and politic ( "Holder" ) , at a place designated by Holder, the principal sum of FIVE HUNDRED NINETY THOUSAND DOLLARS ($590, 000 . 00) or such lesser amount which shall from time to time be owing hereunder on account of unpaid advances made by Holder to or for the benefit of Maker. The principal sum hereof shall be disbursed pursuant to the terms and conditions set forth in that certain Housing Rehabilitation Agreement of even date herewith by and between Maker and Holder ( "HRA") . 1. Repayment by Maker. All unpaid and unforgiven principal under this Note shall be due and payable thirty (30) years after the recordation of the Certificate of Completion, as such term is defined in the HRA. Unless and until Holder shall have accelerated the obligations hereunder pursuant to Section 4, (i) no interest shall accrue on the unpaid principal of this Note and (ii) a portion of the total principal advanced hereunder shall be forgiven on each anniversary date of the recordation of the Certificate of Compliance in an amount equal to the total principal advanced hereunder divided by thirty (30) . Any payments made by Maker in payment of this Note shall be applied first to the interest then accrued, if any, and then to the due and unpaid principal balance under this Note. 2 . Prepayment. This Note may be prepaid in whole or in part at any time without penalty. 3 . Note Secured by Deed of Trust . This Note is secured by a Deed of Trust With Assignment of Rents and Fixture Filing of even date herewith, encumbering certain real property located in the County of Riverside, State of California, more particularly described therein, and any other instruments, now or hereafter PAGE 1 OF 6 FS1083\0140V,0012M803.3 07/21/93 executed by Maker in favor of Holder, which in any manner constitute additional security for this Note ( "Deed of Trust" ) . 4 . Acceleration_of Obligation. Upon the failure to make a payment that may become due under this Note (whether by extension, acceleration or otherwise) , or if an Event of Default occurs under the Deed of Trust or any obligation secured thereby (including the obligations in the HRA and the Regulatory Agreement (as defined in the HPA] ) , or any material breach of any other promise or obligation in this Note or in any other instrument now or hereafter securing the indebtedness evidenced hereby, then, and in any of such events, Holder may, at its option, declare this Note and the entire indebtedness hereby evidenced that has not been forgiven pursuant to Section 1 above to he immediately due and payable and collectible then or thereafter as Holder may elect, regardless of the date of maturity, and notice of the exercise of said option is hereby expressly waived by Maker. S . Default Interest. If any event occurs giving Holder the right to accelerate this Note pursuant to Section 4 above, the entire unpaid and unforgiven principal owing hereunder shall commence to accrue interest at a rate equal to three percentage points above the reference rate published by Sank of America N.A. , or the maximum non-usurious interest rate permitted by law, whichever is less . 6. Collection Costs : Attorneys, Fees . If any attorney is engaged by Holder because of any event of default under this Note or the Deed of Trust Or to enforce of defend any provision of either instrument, whether or not suit is filed hereon, then Maker shall pay upon demand reasonable attorneys' fees and all costs so incurred by Holder together with interest thereon until paid at the applicable rate of interest payable hereunder, as if such fees and costs had been added to the principal owing hereunder. 7. Waivers by Maker. Maker and all endorsers, guarantors and persons liable or to become liable on this Note waive presentment, protest and demand, notice of protest, demand and dishonor and nonpayment of this Note and any and all other notices or matters of a like nature, and consent to any and all renewals and extensions near the time of payment hereof and agree further that at any time and from time to time without notice, the terms of payment herein may be modified or the security described in any documents securing this Note released in whole or in part, or increased, changed or exchanged by agreement between Holder and any owner of the premises affected by said documents securing this Note, without in any way affecting the liability of any party to this Note or any persons liable or to become liable with respect to any indebtedness evidenced hereby. PAGE 2 OF 6 F511%31014090-W121378M3 QW22193 8 . Due on Sale: Due on Encumbrance. The Deed of Trust contains the following provision: " (a) As used herein, the term "Transfer" shall mean any transfer, disposition, assignment, hypothecation, mortgage, pledge, conveyance, lease (excluding leases to tenants in the ordinary course of Trustor's business) , sale, exchange, gift, or encumbrance of all or any portion of the Subject Property, or the improvements thereon, whether voluntary, involuntary or by operation of law. A Transfer shall also include the transfer to any person or group of persons acting in concert of twenty-five percent (25%) or more of the present ownership and/or control of Trustor, taking all transfers into account on a cumulative basis. In the event Trustor or its successor is a corporation or trust, such transfer shall refer to the transfer of the issued and outstanding voting rights or capital stock of Trustor, or of the beneficial interests of such trust; in the event that Trustor is a limited or general partnership, such transfer shall refer to the transfer of more than twenty- five percent (25%) of the limited or general partnership interests; in the event that Trustor 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. Notwithstanding the foregoing, a Transfer shall not include (i) any mortgage or deed of trust for restructuring or refinancing the Senior Lien; provided that the amount of the indebtedness incurred in restructuring or refinancing does not exceed the outstanding balance of the Senior Lien; (ii) a mortgage or deed of trust subordinate to this Deed of Trust for the benefit of the Federal Home Loan Sank Board in an amount not to exceed FOUR HUNDRED THIRTY-FIVE THOUSAND DOLLARS ($435, 000. 00) ; or (iii) a sale, assignment, transfer or disposition of an interest in Beneficiary or the Subject Property to a partnership in which Corporate Fund for Housing or any corporation controlled by Corporate Fund for Housing is the managing general partner. 11 (b) In the event Trustor shall Transfer the Subject Property, directly or indirectly, voluntarily or by operation of law, without the prior written approval of Beneficiary, which approval shall not be unreasonably withheld, then, or at any time thereafter, Beneficiary, at its sole and absolute discretion, may, by written notice to Trustor, declare all obligations secured hereby PAGE 3 OF 6 F5113831014084-001297803.3 07/29193 immediately due and payable. In considering whether it will grant approval to any Transfer by Trustor, Beneficiary shall consider factors such as (i) whether the completion of the Project is jeopardized; (ii) the financial strength and capability of the proposed transferee to perform Trustor15 obligations hereunder; and (iii) the proposed transferee's experience and expertise in the planning, financing, development, ownership, and operation of similar projects. It shall be deemed reasonable for the Beneficiary to refuse to consent to a Transfer based on any of the above referenced reasons. 11 (c) Trustor shall notify Beneficiary promptly in writing of any transaction or event which may give rise to a right of acceleration hereunder. The foregoing options may be exercised at any time after the occurrence of any such event and the acceptance of one or more installments from any person thereafter shall not constitute a waiver of Beneficiary's option. Beneficiary's approval of any sale, assignment, transfer, disposition, encumbrance or other lien or failure to exercise said option with respect thereto shall not be construed as a waiver of the provisions hereof with regard to any subsequent transactions. " 9 . Severability. The unenforceability or invalidity of any provision or provisions of this Note as to any persons or circumstances shall not render that provision or those provisions unenforceable or invalid as to any other provisions or circum- stances, and all provisions hereof, in all other respects, shall remain valid and enforceable. 10. Modifications. Neither this Note nor any term hereof may be waived, amended, discharged, modified, changed or terminated orally; nor shall any waiver of any provision hereof be effective except by an instrument in writing signed by Maker and Holder. No delay or omission on the part of Holder in exercising any right hereunder shall operate as a waiver of such right or of any other right under this Note. 11. No Waiver by Holder. No waiver of any breach, default or failure of condition under the terms of this Note or the Deed of Trust or the obligation secured thereby shall be implied from any failure of the Holder of this Note to take, or any delay be implied from any failure by the Holder in taking action with respect to such breach, default or failure from any prior waiver of any similar or unrelated breach, default or failure. PAGE 4 OF 6 F511383101408440121373033 07R9193 12. usury. Notwithstanding any provision in this Note, Deed of Trust or other document securing same, the total liability for payment in the nature of interest shall not exceed the limit now imposed by applicable laws of the State of California. 13. Governing Law. This Note has been executed and delivered by Maker in the State of California and is to be governed and construed in accordance with the laws thereof. 14. Maker Non-Profit. Holder acknowledges that it has received financial statements of Maker from Maker, and that Maker is a nonprofit public benefit corporation without members and without assured sources of funding or capital. Notwithstanding any provision or obligation to the contrary contained in this Note, (a) the liability of Maker under this Note to Holder and its successors and assigns, is limited to Maker's interest in the Project and the Property and Holder shall look exclusively thereto, or to such other security as may from time to time be given for the payment of obligations arising out of this Note or any other agreement securing the obligations of Maker under this Note; and (b) from and after the date of this Note, no deficiency or other personal judgment, nor any order or decree of specific performance (other than pertaining to this Note, any agreement pertaining to the Property or the Project or any other agreement securing Maker's obligations under this Note) , shall be rendered against: (i) Maker; (ii) the assets of Maker (other than Maker's interest in the Project or the Property and the rents, issues and profits thereof, any agreement pertaining to the Property or any other agreement securing Maker's obligations under this Note) ; or (iii) its officers, directors, agents or members or their heirs, personal representatives, successors, transferees or assigns, as the case may be, in any action or proceeding arising out of this Note, or any agreement securing the obligations of Maker under this Note, or any judgment, order or decree rendered pursuant to any such action or proceeding. Notwithstanding the foregoing, Maker shall have personal liability for one hundred percent (1OOk) of the costs or damages arising from any of the following: (i) fraud or intentional material misrepresentation which induce Holder to enter into the transaction evidenced by the HRA and the documents referred to therein, including this Note, the Deed of Trust and the Regulatory Agreement; (ii) commission of waste; (iii) causing cancellation of any of the insurance required pursuant to the Deed of Trust; (iv) intentional failure to observe and comply with all applicable laws, ordinances, regulations; and (v) the intentional misapplication of (a) proceeds paid, prior to any foreclosure of the Property, under any insurance policy by reason of damage, loss, or destruction to any portion of the Property (to the full extent of such proceeds) ; (b) any proceeds or awards resulting from the condemnation, prior to any foreclosure, of all or any part of the PAGE 5 OF 6 PS117131014014-0012%37IM.3 09123 3 Property (to the full extent of such proceeds or awards) ; and/or (c) gross receipts from rental of the Property received or applicable to a period prior to any foreclosure of the Property, after notice of default, which gross receipts are deemed to be the property of Holder, including without limitation, the collection and retention of any such gross receipt after any notice of default or foreclosure or exercise of other remedies by Holder (following any applicable cure periods) has been given to Maker. IN WITNESS WHEREOF, Maker has executed this Note as of the date and year first above written. CORPORATE FUND FOR HOUSING, a California nonpr fit lic benefit corporati n By: By: Its: "Maker" PAGE 6 OF 6 FS1%313\0140WW1Z3'W.3 09/Z3M Lt 4C in TITLE CO. p }} Y a a RECORDING REQUESTED BY a a) M AND WHEN RECORDED RETURN TO: e CCp THE COMMUNITY REDEVELOPMENT AGENCY p S CL c m OF THE CITY OF PALM SPRINGS LLi @ W 3200 East Tahquitz-Canyon Way a CO i x Palm Springs, CA 92262 V Attn: Executive Director i V o N X O I rn (Space above this line for Recorder's use only o " >_ + oa W n M O i 9k•r- L Ql N I— i-I DEED OF TRUST WITH ASSIGNMENT OF RENTS o o SECURITY AGREEMENT AND FIXTURE FILING o s W d`0 = W U L N U K N O N O1 cJ' X U_M to ¢ W THE PARTIES TO THIS DEED OF TRUST, made as ofr� Z£' 1993 , are CORPORATE FUND FOR HOUSING, a California no profit public benefit corporation ( "Trustor") , FIRST AMERICAN TITLE INSURANCE COMPANY, a California corporation ( "Trustee" ) , and THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA, a public body, corporate and politic ( "Beneficiary" ) . ARTICLE I. GRANT IN TRUST 1. 01 Grant. For the purposes and upon the terms and conditions in this Deed of Trust, Trustor irrevocably grants, conveys and assigns to Trustee, in trust for the benefit of Beneficiary, with power of sale and right of entry and possession, all that real property located in the County of Riverside, State of California, described on Exhibit "1" attached hereto ( "Property" ) together with all appurtenances, easements, rights and rights-of- way appurtenant or related thereto, all buildings, other improvements and fixtures now or hereafter located thereon, all interests or estates which Trustor may hereafter acquire in the property described above, and all additions and accretions thereto (collectively "Subject Property") . The listing of specific rights or property shall not be interpreted as a limit of general terms . 1. 02 Address. The address for the Subject Property is 2890 East Tahquitz Canyon Way, Palm Springs, California 92627. However, neither the failure to designate an address nor any inaccuracy in the address designated shall affect the validity or priority of the Page 1 of 27 PS21.993\01408"12\2037442.3 09/16193 382205 lien of this Deed of Trust on the Subject Property as described on Exhibit "A" . 1. 03 Priority. This Deed of Trust shall constitute a second lien on the Property, subject to the lien of that certain Deed of Trust, Assignment of Rents, Security Agreement and Fixture Financing Filing Statement executed by Trustor for the benefit of Redlands Federal Bank and the Housing Authority of the City of Palm Springs recorded concurrently herewith in the Official Records of Riverside County, California ( "Senior Lien" ) . ARTICLE II. OBLIGATIONS SECURED 2 . 01 Obligations Secured. Trustor makes this grant and assignment for the purpose of securing the following obligations ( "Secured Obligations") : (a) Payment to Beneficiary of all indebtedness at any time owing under the terms of that certain Promissory Note Secured by Deed of Trust of even date herewith, executed by Trustor and payable to Beneficiary, in the principal amount of FIFTY-NINE THOUSAND DOLLARS ($590, 000 .00) ; and (b) Payment and performance of all obligations of Trustor under this Deed of Trust; and (c) Payment and performance of all obligations of Trustor under that certain Housing Rehabilitation Agreement ( "HRA" ) between Trustor as "Participant" and Beneficiary as "Agency" of even date herewith and that certain Regulatory Agreement and Declaration of Covenants and Restrictions of even date herewith between Trustor and Beneficiary; (d) Payment and performance of all future advances and other obligations that the then record owner of all or part of the Subject Property may agree to pay and/or perform (whether as principal, surety or guarantor) for the benefit of Beneficiary, when the obligation is evidenced by a writing which recites that it is secured by this Deed of Trust; and (e) All modifications, extensions and renewals of any of the obligations secured hereby, however evidenced. 2 . 02 Obligations . The term "obligations" is used herein in its broadest and most comprehensive sense and shall be deemed to include, without limitation, all interest and charges, prepayment charges, late charges and fees at any time accruing or assessed on any of the Secured Obligations . Page 2 of 27 F32\393\0I40"4012\2037442.3 09/16/93 • 382205 2 . 03 In co oration. All terms of the Secured Obligations are incorporated herein by this reference. All persons who may have or acquire an interest in the Subject Property shall be deemed to have notice of the terms of the Secured Obligations and to have notice that, if provided therein, (a) the Note or the HRA may per- mit borrowing, repayment and re-borrowing, and (b) the rate of interest on one or more Secured Obligations may vary from time to time. ARTICLE III . ASSIGNMENT OF LEASES, CONTRACTS RENTS AND PROFITS 3 . 01 Assignment. Trustor hereby absolutely, presently and unconditionally assigns, transfers, conveys and sets over to Beneficiary (subject to all other prior liens of record) the following: (a) All of the rents, income, profits, revenue, judgments, condemnation awards, insurance proceeds, unearned insurance premiums and any other fees or sums payable to Trustor or any other person as landlord and other benefits and rights of the Subject Property arising from ,the use, occupancy, operation or management of all or any portion thereof or from all the Leases (as defined in subparagraph (2) ) , and proceeds, deposits or security deposits relating thereto, including, without limitation, any award made to Trustor hereafter in any court involving any of the tenants under the Leases in any bankruptcy, insolvency, or reorganization proceeding in any state or federal court, and Trustor' s right to appear in any action and/or to collect any such award or payment, and all payments by any tenant in lieu of rent (collectively, "Rents and Profits") ; (b) All of the leases relating to the Subject Property which are in effect on the date hereof and entered into or in effect from time to time after the date hereof, including, without limitation, all amendments, extensions, replacements, modifications and renewals thereof and all subleases, concession agreements, any ground leases or ground subleases and all other agreements affecting the same (the "Leases" ) ; (c) All right, title and interest of Trustor in and to all Leases whether arising thereunder, by statute, at law, in equity, or in any other way; (d) All right, title and interest of Trustor in and to all contracts, agreements, management, operating and maintenance agreements, warranties, licenses, permits, and guaranties relating to the Subject Property, including, but Page 3 of 27 PS2136.310140&4-001212037442.3 09/16/93 • 382205 not limited to, all ' present and future plans and specifications, shop drawings, working drawings, amendments, modifications, charges, supplements, general conditions and addenda thereto in connection with the rehabilitation of the Subject Property as provided in the $RA (the "Contracts" ) . 3 . 02 License. Notwithstanding the provisions of paragraph 3 . 01 prior to the occurrence of an Event of Default (as such term is hereinafter defined) hereunder, Beneficiary shall not exercise any of the rights or powers conferred upon Beneficiary by this Article III, and Trustor shall have a license to manage the Subject Property, to collect, receive and use all Rents and Profits, to let the Subject Property and to take all such actions which a reasonable and prudent landlord would take in enforcing the provisions of the Leases or Contracts . This covenant is not intended to benefit any party other than Beneficiary. Upon the occurrence of Event of Default (whether or not Beneficiary shall have exercised its option to declare the Note immediately due and payable) , such license shall be automatically revoked without any action required by Beneficiary and the Rents and Profits shall be paid directly to Beneficiary; and Beneficiary may notify the tenants under the Leases or any other parties in possession of the Subject Property, to pay the Rents and Profits directly to Beneficiary, at the address specified in Section 7. 06, and Rents and Profits so paid to Beneficiary may be applied by Beneficiary, at Beneficiary' s sole discretion, to the payment of the costs and expenses of the operation of the Subject Property, to the payment of accrued interest and principal on the Note and/or to the prepayment of the Note, all in the order, manner and respective amounts as Beneficiary shall from time to time determine. 3 . 03 Payment of Rents Upon Event of Default. Upon the occur- rence of an Event of Default, the Beneficiary shall have the right, but not the obligation, to perform as landlord under the Leases and as a party under the Contracts. The assignment of Rents and Profits set forth herein constitutes an irrevocable direction and authorization of all tenants under the Leases to pay all Rents and Profits to Beneficiary upon demand and without further consent or other action by Trustor. Trustor irrevocably appoints Beneficiary its true and lawful attorney, at the option of Beneficiary at any time, to demand, receive and enforce payment, to give receipts, releases and satisfactions, and to sue, either in the name of Trustor or in the name of Beneficiary, for all such Rents and Profits and apply the same to the indebtedness secured by this Deed of Trust. 3 . 04 Mortgagee-in-Possession. Neither the foregoing assignment of Rents and Profits, Leases and Contracts to Beneficiary nor the exercise by Beneficiary of any of its rights or remedies hereunder shall be deemed to make Beneficiary a "mortgagee-in-possession" or otherwise liable in any manner with respect to the Subject Property, unless Beneficiary, in person or Page 4 of 27 P32MM014M"1212037442.3 09/16/93 • • 382205 by agent, assumes actual possession thereof. Nor shall appointment of a receiver for the Subject Property by any court at the request of Beneficiary or by agreement with Trustor, or the entering into possession of the Subject Property by such receiver, be deemed to make Beneficiary a "mortgagee-in-possession" or otherwise liable in any manner with respect to the Subject Property. 3 . 05 No Cure. In the event Beneficiary collects and receives any Rents and Profits under this Article III upon any Event of Default hereof, such collection or receipt shall in no way constitute a curing of the Event of Default . 3 . 06 No Action By Trustor. Without the prior written consent of Beneficiary, Trustor shall not pledge, transfer, mortgage or otherwise encumber or assign the Leases, the Contracts or the Rents and Profits or collect Rents more than thirty (30) days prior to accrual . 3 . 07 No Liability. Beneficiary shall not be obligated to perform or discharge, nor does it hereby undertake to perform or discharge, any obligation, duty or liability under the Leases or under or by reason of this assignment. Trustor shall and does hereby agree to indemnify Beneficiary for and to defend and hold Beneficiary harmless from any liability, loss or damage which Beneficiary may incur under the Leases or under or by reason of this assignment, and from any claims whatsoever which may be asserted against Beneficiary by reason of any alleged obligations or undertakings on Beneficiary' s part to perform or discharge any of the terms, covenants or agreements contained in the Lease. Should Beneficiary incur any liability, loss or damage under the Leases or under or by reason of this assignment, or in the defense of any of such claim or demands, the amount thereof, including costs, expenses and attorney's fees, shall be secured by this Deed of Trust; and Trustor shall reimburse Beneficiary therefor immediately upon demand, and upon failure of Trustor to do so, Beneficiary may declare all sums so secured to be immediately due and payable. 3 . 08 Receiver. In addition to any and all other remedies of Beneficiary set forth under this Deed of Trust or permitted at law or in equity, if an Event of Default shall have occurred, Beneficiary, to the extent permitted by law and without regard to the value, adequacy or occupancy of the security for the Note and other sums secured hereby, shall be entitled as a matter of right if it so elects to the appointment of a receiver to enter upon and take possession of the Property and to collect all Rents and Profits and apply the same as the court may direct, and such receiver may be appointed by any court of competent jurisdiction by ex parte application and without notice, notice of hearing being hereby expressly waived. The expenses, including receiver' s fees, attorneys' fees, costs and agent' s compensation, incurred pursuant Page 5 of 27 PSZ393\014034001212037442.3 09/16/93 • • 382205 to the power herein contained shall be secured by this Deed of Trust. ARTICLE IV. SECURITY AGREEMENT AND FIXTURE FILING 4 . 01 Security Agreement. This Deed of Trust constitutes a Security Agreement with respect to all personal property in which Beneficiary is granted a security interest hereunder, and Beneficiary shall have all of the rights and remedies of a secured party under the Uniform Commercial Code as enacted in California (the "California Uniform Commercial Code") as well as all other rights and remedies available at law or in equity. Trustor hereby agrees to execute and deliver on demand and hereby irrevocably constitutes and appoints Beneficiary the attorney-in-fact of Trustor, to execute, deliver and, if appropriate, to file with the appropriate filing officer or office such security agreements, financing statements, continuation statements or other instruments as Beneficiary may request or require in order to impose, perfect or continue the perfection of, the lien or security interest created hereby. Trustor and Beneficiary agree that the filing of a financing statement in the record normally having to do with personal property shall never be construed as in any way derogating from or impairing the lien of this Deed of Trust and the intention of Trustor and Beneficiary that everything used in connection with the operation or occupancy of the Property is and at all times and for all purposes and in all proceedings, both legal and equitable, shall be regarded to as real property or goods which are or are to become fixtures, irrespective of whether (i) any such item is physically attached to the buildings and improvements on the Property; (ii) serial numbers are used for the better identification of certain equipment items capable of being filed by the Beneficiary; or (iii) any such item is referred to or reflected in any such financing statement so filed at any time. Such mention in the financing statements is declared to be for the protection of the Beneficiary in the event any court or judge shall at any time hold that notice of Beneficiary' s priority of interest must be filed in the California Commercial Code records to be effective against a particular class of persons, including, but not limited to, the federal government and any subdivision or entity of the federal government. Trustor covenants and agrees to reimburse Beneficiary for any costs incurred in filing such financing statement and any continuation statements. Upon the occurrence of Event of Default hereunder, Beneficiary shall have the right to cause any of the Property which is personal property and subject to the security interest of Beneficiary hereunder to be sold at any one or more public or private sales as permitted by applicable law, and Beneficiary shall further have all Page 6 of 27 F521383\0140t40012\2037442.3 09/16/93 • 382205 other rights and remedies, whether at law, in equity, or by statute, as are available to secured creditors under applicable law, specifically including without limitation the right to proceed as to both the real property and the personal property contained within the Property as permitted by Uniform Commercial Code Section 9501 (4) , including conducting a unified sale thereof . Any such disposition may be conducted by an employee or agent of Beneficiary or Trustee. Any person, including both Trustee and Beneficiary, shall be eligible to purchase any part or all of such property at any such disposition. This Deed of Trust constitutes a fixture filing under Sections 9313 and 9402 (6) of the California Uniform Commercial Code, as amended or recodified from time to time. ARTICLE V. RIGHTS AND DUTIES OF THE PARTIES 5 . 01 Title. Trustor warrants that, to the best of Trustor' s knowledge, except as disclosed to Beneficiary in a writing which refers to this warranty, Trustor lawfully possesses and holds fee simple title to the Subject Property without limitation on the right to encumber subject to all matters of record, and that this Deed of Trust is a valid lien on the Subject Property. 5 . 02 Taxes and Assessments . Trustor shall pay prior to delinquency all taxes, assessments, levies and charges imposed by any public or quasi-public authority or utility company which are or which may become a lien upon the Subject Property or any interest therein. Trustor shall also pay prior to delinquency all taxes, assessments, levies and charges imposed by any public authority upon Beneficiary by reason of its interest in any Secured Obligation or in the Subject Property, or by reason of any payment made to Beneficiary pursuant to any Secured Obligation; but Trustor shall have no obligation to pay taxes which may be imposed from time to time upon Beneficiary and which are measured by and imposed upon Beneficiary' s net income. 5 . 03 Performance of Secured Obligations. Trustor shall promptly pay and perform each Secured Obligation when due. 5 . 04 Liens Encumbrances and Charges . Trust shall immedi- ately discharge any lien not approved by Beneficiary in writing that has or may attain priority over this Deed of Trust, except those liens disclosed in the policy of title insurance issued to Beneficiary under the HRA. Trustor shall pay when due all obligations secured by or reducible to liens and encumbrances which shall now or hereafter encumber or appear to encumber all or any part of the Subject Property or any interest therein, whether Page 7 of 27 FS2\393\014084-0012\2037442.3 09/16/93 382205 senior or subordinate hereto, including, but not limited to, all obligations under the Senior Lien. 5 . 05 Damages: Insurance and Condemnation Proceeds . (a) (i) All awards of damages and all other compensation payable directly or indirectly by reason of a condemnation or proposed condemnation for public or private use affecting all or any part of, or any interest in, the Subject Property; and (ii) all other claims and awards for damages to, or decrease in value of, all or any part of, or any interest in, the Subject Property; and (iii) all proceeds of any insurance policies payable by reason of loss sustained to all or any part of the Subject Property; and (iv) all interest which may accrue on any of the foregoing, are all absolutely and irrevocably assigned to and shall be paid to Beneficiary. At the absolute discretion of Beneficiary, whether or not its security is or may be impaired, but, subject to applicable law, if any, and without regard to any requirement contained in Section 5 . 06 (c) , Beneficiary may (i) apply all or any of the proceeds it receives to its expenses in settling, prosecuting or defending the claim and apply the balance to the Secured Obligations in any order, and/or (ii) release all or any part of the proceeds to Trustor upon any conditions Beneficiary may impose. Beneficiary may commence, appear in, defend or prosecute any assigned claim or action and may adjust, compromise, settle and collect all claims and awards assigned to Beneficiary, but shall not be responsible for any failure to collect any claim or award, regardless of the cause of the failure. (b) Beneficiary shall permit insurance or condemnation proceeds held by Beneficiary to be used for repair or restoration but may condition such application upon the deposit with Beneficiary of such additional funds which Beneficiary determines are needed to pay all costs of the repair or restoration (including without limitation, taxes, financing charges, insurance and rent during the repair period) , on establishment of an arrangement for lien releases and disbursement of funds acceptable to Beneficiary and on delivery to Beneficiary of: (i) Plans and specifications for the work, a contract for the work signed by a contractor acceptable to Beneficiary, a cost breakdown for the work and a payment and performance bond for the work, all of which shall be acceptable to Beneficiary; and (ii) Evidence acceptable to Beneficiary: (A) that after completion of the work the income from the Subject Property will be sufficient to pay all expenses and debt service for the Subject Property; (B) of Page 8 of 27 FS2\.313\0I40640012\2037"2.3 09/16/93 continuation of leases acceptable to and required by Beneficiary; (C) that, upon completion of the work, the size, capacity and total value of the Subject Property will be at least as great as it was before the damage or condemnation occurred; (D) that there has been no material or substantial adverse change in the financial condition or credit of Trustor since the date of this Deed of Trust; and (E) of satisfaction of any additional conditions that Beneficiary may establish to protect its security. Trustor acknowledges that the specific conditions described above are reasonable. If the foregoing requirements are not satisfied, Beneficiary shall not be obligated to allow said funds to be delivered to Trustor but may rather apply said proceeds against the outstanding sums under the Note. 5 . 06 Maintenance and Preservation of the Suj2ject Property. Subject to the provisions of the HRA, Trustor covenants : (a) to insure the Subject Property and to keep the Subject Property in good condition and repair; (b) except with Beneficiary' s prior written consent, not to remove or demolish the Subject Property or any part thereof; not to alter, restore or add to the Subject Prop- erty; and not to initiate or acquiesce in any change in any zoning or other land classification which affects the Subject Property; (c) to complete or restore promptly and in good and workmanlike manner the Subject Property or any part thereof which may be damaged or destroyed, without regard to whether Beneficiary elects to require that insurance proceeds be used to reduce the Secured Obligations as provided in Section 5 . 05; (d) not to suffer any violation of any, and to comply with all (i) laws, ordinances, regulations and standards, and (ii) all covenants, conditions, restrictions and equitable servitudes, whether public or private, of any kind and character and (iii) requirements of insurance companies and any bureau or agency which establishes standards of insurability, which laws, covenants or requirements affect the Subject Property and pertain to acts committed or conditions existing thereon, including (but without limitation) such work or alteration, improvement or demolition as such laws, covenants or requirements mandate; (e) not to commit or permit waste of the Subject Property; and (f) to do all other acts which from the character or use of the Subject Property may be reasonably necessary to maintain and reserve its value. 5 . 07 Defense and Notice of Logges , Claims and Action . Trustor, at Trustor' s sole expense, shall protect, preserve and defend the Subject Property and title to and right of possession of the Subject Property, the security hereof and the rights and powers of Beneficiary and Trustee hereunder against all adverse claims . Trustor shall give Beneficiary and Trustee prompt notice in writing of the assertion of any claim, of the filing of any action or Page 9 of 27 FS2\393\011084-0012\2037442.3 09/16/93 3822®5 proceeding, of the occurrence of any damage to the Subject Property, and of any condemnation offer or action. 5 . 08 Acceptance of Trust ; Pow rs and Dutigg of Trustee . Trustee accepts this trust when this Deed of Trust is recorded. From time to time upon written request of Beneficiary and presentation of this Deed of Trust for endorsement, and without affecting the personal liability of any person for payment of any indebtedness or performance of any obligation secured hereby, Trustee may, without liability therefor and without notice, reconvey all or any part of the Subject Property; consent to the making of any map or plat thereof; or join in any grant of easement thereon, any declaration of covenants and restrictions, any extension agreement or any agreement subordinating the lien or charge hereof. Trustee or Beneficiary may from time to time apply to any court of competent jurisdiction for aid and direction in the execution of the trusts hereunder and the enforcement of the rights and remedies available hereunder, and may obtain orders or decrees directing or confirming or approving acts in the execution of said trusts and the enforcement of said rights and remedies . Trustee has no obligation to notify any party of any pending sale or any action or proceeding (including, but not limited to actions in which Trustor, Beneficiary or Trustee shall be a party) unless held or commenced and maintained by Trustee under this Deed of Trust. Trustee shall not be obligated to perform any act required of it hereunder unless the performance of the act is requested in writing and trustee is reasonably indemnified against loss, cost, liability and expense. 5 . 09 Compensation: Exculoa ion• Ind mnifica inn (a) Trustor shall pay Trustee' s fees and reimburse Trustee for expenses in the administration of this trust, including attorneys' fees. Trustor shall pay to Beneficiary reasonable compensation for services rendered concerning this Deed of Trust, including, without limitation, any statement of amounts owing under any Secured Obligation. Beneficiary shall not directly or indirectly be liable to Trustor or any other person as a consequence of (i) the exercise of the rights, remedies or powers granted to Beneficiary in this Deed of Trust; (ii) the failure or refusal of Beneficiary to perform or discharge any obligation or liability of Trustor under any agreement related to the Subject Property or under this Deed of Trust; or (iii) any loss sustained by Trustor or any third party resulting from Beneficiary' s failure to lease the Subject Property after a default or from any other act or omission of Beneficiary in managing the Subject Property after a default unless the loss is caused by the willful misconduct and bad faith of Beneficiary and no such liability shall be asserted against or imposed upon Beneficiary, and all such liability is hereby expressly waived and released by Trustor. Page 10 of 27 FS21.393\0140V-W12U037442.3 09/16/93 (b) Trustor indemnifies Trustee and Beneficiary against, and holds them harmless from all losses, damages, liabilities, claims, causes of action, judgments, court costs, attorneys' fees and other legal expenses, cost of evidence of title, cost of evidence of value, and other expenses which either it may suffer or incur (i) by reason of this Deed of Trust; (ii) by reason of the execution of this trust or in performance of any act required or permitted hereunder or by law; or (iii) as a result of any failure of Trustor to perform Trustor' s obligations; or (iv) by reason of any alleged obligation or undertaking on Beneficiary' s part to perform or discharge any of the representations, warranties, conditions, covenants or other obligations contained in any other document related to the Subject Property. (c) Trustor shall pay all indebtedness arising under this Section 5 . 09 immediately upon demand by Trustee or Beneficiary, together with interest thereon from the date the indebtedness arises at the greatest effective rate of interest specified in the Note. Trustor' s duty to indemnify Trustee and Beneficiary shall survive the release and cancellation of the Secured Obligations and the release and reconveyance or any partial release or reconveyance of this Deed of Trust. 5 . 10 Substitution of Trustees . From time to time, by a writing signed and acknowledged by Beneficiary and recorded in the Office of the Recorder of the County in which the Subject Property is situated, Beneficiary may appoint another trustee to act in the place and stead of Trustee or any successor. Such writing shall set forth any information required by law. The recordation of such instrument of substitution shall discharge Trustee herein named and shall appoint the new trustee as the trustee hereunder with the same effect as if originally named Trustee herein. A writing recorded pursuant to the provisions of this section shall be conclusive proof of the proper substitution of such new Trustee. 5 . 11 Due On Sale, Acceleration Upon Sale or Encumbrance. (a) As used herein, the term "Transfer" shall mean any transfer, disposition, assignment, hypothecation, mortgage, pledge, conveyance, lease (excluding leases to tenants in the ordinary course of Trustor' s business) , sale, exchange, gift, or encumbrance of all or any portion of the Subject Property, or the improvements thereon, whether voluntary, involuntary or by operation of law. A Transfer shall also include the transfer to any person or group of persons acting in concert of twenty-five percent (25t) or more of the present ownership and/or control of Trustor, taking all transfers into account on a cumulative basis. In the event Trustor or its successor is a corporation or trust, such transfer shall refer to the transfer of the issued and outstanding voting rights or capital stock of Trustor, or of the beneficial interests of Page 11 of 27 F52139MO1409"1212037442.3 09/16/93 • • 382205 such trust; in the event that Trustor is a limited or general partnership, such transfer shall refer to the transfer of more than twenty-five percent (25!k) of the limited or general partnership interests; in the event that Trustor is a joint venture, such transfer shall refer to the transfer of more than twenty-five percent (2596) of the ownership and/or control of any such joint venture partner, taking all transfers into account on a cumulative basis. Notwithstanding the foregoing, a Transfer shall not include (i) any mortgage or deed of trust for restructuring or refinancing the Senior Lien; provided that the amount of the indebtedness incurred in restructuring or refinancing does not exceed the outstanding balance of the Senior Lien; (ii) a mortgage or deed of trust subordinate to this Deed of Trust for the benefit of the Federal Home Loan Bank Board in an amount not to exceed FOUR HUNDRED THIRTY-FIVE THOUSAND DOLLARS ($435, 000 . 00) ; and (iii) a sale, assignment, transfer or disposition of an interest in Beneficiary or the Subject Property to a partnership in which Corporate Fund for Housing or any corporation controlled by Corporate Fund for Housing is the managing general partner. (b) In the event Trustor shall Transfer the Subject Property, directly or indirectly, voluntarily or by operation of law, without the prior written approval of Beneficiary, which approval shall not be unreasonably withheld, then, or at any time thereafter, Beneficiary, at its sole and absolute discretion, may, by written notice to Trustor, declare all obligations secured hereby immediately due and payable. In considering whether it will grant approval to any Transfer by Trustor, Beneficiary shall consider factors such as (i) whether the completion of the Project is jeopardized; (ii) the financial strength and capability of the proposed transferee to perform Trustor' s obligations hereunder; and (iii) the proposed transferee' s experience and expertise in the planning, financing, development, ownership, and operation of similar projects. It shall be deemed reasonable for the Beneficiary to refuse to consent to a Transfer based on any of the above referenced reasons. (c) Trustor shall notify Beneficiary promptly in writing of any transaction or event which may give rise to a right of acceleration hereunder. The foregoing options may be exercised at any time after the occurrence of any such event and the acceptance of one or more installments from any person thereafter shall not constitute a waiver of Beneficiary' s option. Beneficiary's approval of any sale, assignment, transfer, disposition, encumbrance or other lien or failure to exercise said option with respect thereto shall not be construed as a waiver of the provisions hereof with regard to any subsequent transactions. Page 12 of 27 P32\313\01408"12\2037442.3 09/16/93 5 . 12 Releases , Extensions Modifications and Additional Security. Without notice to or the consent, approval or agreement of any persons or entities having any interest at any time in the Subject Property or in any manner obligated under the Secured Obligations ( "Interested Parties") , Beneficiary may, from time to time, release any person or entity from liability for the payment or performance of any Secured Obligation, take any action or make any agreement extending the maturity or otherwise altering the terms or increasing the amount of any Secured Obligation, or accept additional security or release all or a portion of the Subject Property and other security for the Secured Obligations . None of the foregoing actions shall release or reduce the personal liability of any of said Interested Parties, or release or impair the priority of the lien of this Deed of Trust upon the Subject Property. 5 . 13 Rg9onveyance. No partial reconveyances shall be permitted under this Deed of Trust . Upon Beneficiary's written request and certification that all obligations secured hereby have been satisfied, and upon surrender of this Deed of Trust and the Note to Trustee for cancellation, Trustee shall reconvey, without warranty, the Subject Property. The recitals of any matters or facts in any reconveyance executed hereunder shall be conclusive proof of the truthfulness thereof. To the extent permitted by law, the reconveyance may describe the grantee as "the person or persons legally entitled thereto" . Neither Beneficiary nor Trustee shall have any duty to determine the rights of persons claiming to be rightful grantees of any reconveyance. When the Subject Property has been fully reconveyed, such reconveyance shall operate as a reassignment of all future rents, issues and profits of the Subject Property to the person or persons legally entitled thereto. 5 . 14 Subrogation. Beneficiary shall be subrogated to the lien of all encumbrances, whether released of record or not, paid in whole or in part by Beneficiary pursuant to this Deed of Trust or by the proceeds of any sums secured by this Deed of Trust. 5 . 15 Environmental . (a) For purposes of this Section 5 . 15, the following definitions shall be applicable: U) "Environmental Claim" means any claim for personal injury, death and/or property damage made, asserted or prosecuted by or on behalf of any third party, including, without limitation, any governmental entity, employee, former employee, or their respective legal representatives, heirs, beneficiaries and estates, relating to the Subject Property or their operations and arising or alleged to arise under any Environmental Law. Page 13 of 27 FS2\393\0140t40012\2037442.3 09/16/93 • 382205 (ii) "Environmental Cleanup Liability" means any cost or expense of any nature whatsoever incurred to contain, remove, remedy, clean up, or abate any contamination or any Hazardous Material from or on any part of the Subject Property, including without limitation (i) any direct costs or expenses for investigation, study, assessment, legal representation, cost recovery by governmental agencies, or on- going monitoring in connection therewith and (ii) any cost, expense, loss or damage incurred with respect to the Subject Property or its operation as a result of actions or measures necessary to implement or effectuate any such containment, removal, remediation, treatment, cleanup or abatement . (iii) "Environmental Compliance Cost" means any cost or expense of any nature whatsoever necessary to enable the Subject Property to comply with all applicable Environmental Laws in effect . "Environmental Compliance Cost" shall include all costs necessary to demonstrate that the Subject Property is capable of such compliance. (iv) "Environmental Law" means any federal, state or local statute, ordinance, rule, regulation, order, consent decree, judgment or common-law doctrine, and operating authorizations relating to (A) pollution or protection of the environment, including natural resources; (B) exposure of persons, including employees, to Hazardous Materials or other products, raw materials, chemicals or other substances; (C) protection of the public health or welfare from the effects of by-products, wastes, emissions, discharges or releases of chemical substances from industrial or commercial activities; or (D) regulation of the manufacture, use or introduction into commerce of chemical substances, including, without limitation, their manufacture, formulation, labeling, distribution, transportation, handling, storage and disposal . (v) "Hazardous Materials" is defined to include any hazardous or toxic substance, material or waste which is or becomes regulated by any local governmental authority, the State of California, or the United States Government and asbestos and any material containing asbestos, and includes, without limitation, any material or substance which is (A) petroleum or oil or gas or any direct or derivate product or byproduct thereof; (B) 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, Division 20, Chapter 6 . 8 (Carpenter-Presley-Tanner Hazardous Substance Account Act) ; (C) defined as a "hazardous material, " "hazardous substance, " or "hazardous waste" under Sections 25501 (j ) and (k) and 25501. 1 of the California Health and Safety Code, Division 20, Chapter 6.95 (Hazardous Materials Release Response Plans and Inventory) ; (D) defined as a Page 14 of 27 F5213t3\014094440012\20374t2.3 09/16/93 382205 "hazardous substance" under Section 25281 of the California Health and Safety Code, Division 20, Chapter 6 . 7 (Underground Storage of Hazardous Substances) ; (E) "used oil" as defined under Section 25250 . 1 of the California Health and Safety Code; (F) asbestos; (G) listed under Article 9 or defined as hazardous or extremely hazardous pursuant to Article 1 of Title 22 of the California Code of Regulations, Division 4, Chapter 30; (H) defined as waste or a hazardous substance pursuant to the Porter-Cologne Act, Section 13050 of the California Water Code; (I) designated as a "toxic pollutant" pursuant to the Federal Water Pollution Control Act, 33 U.S.C. § 1317; (J) defined as a "hazardous waste" pursuant to the Federal Resource Conservation and Recovery Act, 42 U.S .C. § 6901 et sea. (42 U.S .C. § 6903) ; (K) defined as a "hazardous substance" pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S .C. § 9601 gt sea. (42 U.S .C. § 9601) ; (L) defined as "Hazardous Material" pursuant to the Hazardous Materials Transportation Act, 49 U.S .C. § 1808 gt, seq. ; or (M) defined as such or regulated by any "Superfund" or "Superlien" law, or any other federal, state or local law, statute, ordinance, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning Hazardous Materials and/or oil wells and/or underground storage tanks and/or pipelines, as now, or at any time hereafter, in effect. (b) Trustor shall, from and after the recordation of this Deed of Trust, defend, indemnify and hold harmless Beneficiary and its officers, directors, employees, agents and representatives (collectively, the "Indemnified Parties") from and against any and all Environmental Claims, Environmental Cleanup Liability, Environmental Compliance Costs, and any other claims, actions, suites, legal or administrative orders or proceedings, demands or other liabilities resulting at any time from the physical and/or environmental conditions of the Subject Property attributable to conduct prior to or after Beneficiary' s acquisition of the Subject Property or following the recordation of this Deed of Trust or from the existence of any Hazardous Material or the release or threatened release of any Hazardous Material of any kind whatsoever, in, on or under the Subject Property attributable to conduct prior to or after Beneficiary' s acquisition of the Subject Property or following the recordation of this Deed of Trust, including, but not limited to, all foreseeable and unforeseeable damages, fees, costs, losses and expenses, including any and all attorneys' fees and environmental consultant fees, directly or indirectly arising therefrom, and including fines and penalties of any nature whatsoever, assessed, levied or asserted against any Indemnified Parties to the extent that the finds and/or penalties are the result of a violation or an alleged violation of any Environmental Law. Page 15 of 27 F52\393\U140Y40012\2037442.3 09/16/93 382205 (c) Trustor hereby covenants and agrees that: (i) Trustor shall not permit the Subject Property or any portion thereof to be a site for the use, generation, manufacture, storage, disposal or transportation of any Hazardous Material; (ii) Trustor shall not install or permit to be installed in the Subject Property, friable asbestos or any substance containing asbestos and deemed hazardous by federal, state or local laws, rules or regulations, orders, respecting such material ; (iii) Trustor shall keep and maintain the Subject Property and each portion thereof in compliance with, and shall not cause or permit the Subject Property or any portion thereof to be in violation of, any Environmental Law; (iv) Trustor shall immediately advise Beneficiary in writing of any of the following: (A) Any and all enforcement, clean-up, removal or other governmental or regulatory actions instituted, completed or threatened pursuant to any Environmental Law; (B) All Claims asserted by any third party against Trustor or the Subject Property; (C) Trustor' s discovery of any occurrence or condition that could cause the Subject Property or any part thereof to be classified as "hazardous waste property" or as "border-zone property" under the provisions of California Health and Safety Code, Sections 25220 g� seQ. or any regulation adopted in accordance therewith, or to be otherwise subject to any restrictions on the ownership, occupancy, transferability or use of the Subject Property under any Environmental Law; and (D) Trustor' s taking of any remedial action in response to the presence of any Hazardous Material at, upon, under, over or about the Subject Property, and any proposed settlement agreement, consent decree, or other compromise in respect to any Claim. (v) In the event Trustor becomes aware of, or upon written notice from Beneficiary of, the presence or threatened presence of any Hazardous Material at the Subject Property, Trustor shall immediately commence remedial clean-up measure to remove such Hazardous Material from the Subject Property, dispose of and mitigate the effects of such Page 16 of 27 H82132=14094-001212037412.3 09116193 • 382205 Hazardous Material, and shall diligently pursue such remedial, clean-up, disposal and mitigation measures to completion, all in compliance with applicable Environmental Laws. Any such remedial clean-up, disposal or mitigation measures proposed or undertaken by Trustor shall not be construed as approval by Beneficiary of the propriety or effectiveness of such remedial, clean-up, disposal or mitigation measures . Trustor shall promptly repair all damage to the Subject Property and the improvements thereof caused by any such remedial, clean- up, disposal or mitigation measures undertaken by or at the director of Trustor. (d) The obligations of Trustor and the rights of Beneficiary under this Section 5 . 15 are in addition to and not in substitution of the obligations of Trustor and the rights of Beneficiary under any Environmental Law, and any other similar applicable laws . (e) The obligations and indebtedness of Trustor, and the rights of Beneficiary, under this Section 5 . 15 and the laws and regulations cited above in this Section 5 . 15, notwithstanding anything contained herein or in any other document or agreement which may be construed to the contrary, W shall not be subject to California Code of Civil Procedures Sections 580a, 580d, 726 or any other antideficiency laws; and (ii) shall survive the foreclosure of this Deed of Trust, the repayment of the indebtedness evidenced by the Note and the termination of the Note. (f) In addition to the rights of Beneficiary set forth in this Deed of Trust, in the event of default under this Deed of Trust or any obligation secured thereby, including without limitation, any default under any Secured Obligation, Beneficiary shall have the following rights and remedies: (i) Beneficiary or its employees, acting by themselves or through a court-appointed receiver, may (A) enter upon, possess, manage, operate, dispose of, and contract to dispose of the Subject Property or any part hereof; take custody of all accounts; (B) negotiate with governmental authorities with respect to the Subject Property' s environmental compliance and remedial measures; (C) take any action necessary to enforce compliance with environmental provisions, including without limitation spending rents to abate the problem; (D) make, terminate, enforce or modify leases of the Subject Property upon such terms and conditions as Beneficiary deems proper; (E) contract for goods and services, hire agents, employees, and counsel, make repairs, alterations, and improvements to the Subject Property necessary, in Beneficiary' s judgment, to protect or enhance the security of this Deed of Trust; (F) incur the risks and obligations ordinarily incurred by owners of property (without Page 17 of 27 PS2\393\014094-WI2\2037442.3 09/16/93 • 352205 any personal obligation on the part of the receiver) ; and/or (G) take any and all other actions which may be necessary or desirable to comply with the obligations of Trustor under this Deed of Trust and the Secured Obligations . All sums realized by Beneficiary under this subparagraph, less all costs and expenses incurred by it under this subparagraph, including without limitation attorneys' fees and costs, and less such sums as Beneficiary deems appropriate as a reserve to meet future expenses under this subparagraph, shall be applied on any indebtedness secured by this Deed of Trust in such order as Beneficiary shall determine. Neither application of said sums to said indebtedness, nor any other action taken by Beneficiary under this subparagraph shall cure or waive any Event of Event of Default or notice of default hereunder, or nullify the effect of any such notice of default . Beneficiary, or any employee or agent of Beneficiary, or a receiver appointed by a court, may take any action or proceeding hereunder without regard to M the adequacy of the security for the indebtedness secured under this Deed of Trust or other security for such obligations; (Y) the existence of a declaration that the indebtedness secured by this Deed of Trust has been declared immediately due and payable; or (Z) the filing of a notice of default . (ii) With or without notice, and without releasing Trustor from any obligation under this Deed of Trust, the obligations secured by this Deed of Trust, other security for such obligations, or the Secured Obligations, to cure any default of Trustor and, in connection therewith, Beneficiary or its agents, acting by themselves or through a court appointed receiver, may enter upon the Subject Property or any part thereof and perform such acts and things as Beneficiary deems necessary or desirable to inspect, investigate, assess, and protect the security of this Deed of Trust, including without limitation, (A) to obtain a court order to enforce Beneficiary' s right to enter and inspect the Subject Property under California Civil Code Section 2929 .5, to which the decision of Beneficiary as to whether there exists a release or threatened release of a hazardous substances onto the Subject Property shall be deemed reasonable and conclusive as among the parties hereto; and (B) to have a receiver appointed under California Code of Civil Procedure Section 564 to enforce Beneficiary' s right to enter and inspect the Subject Property for hazardous substances. All costs and expenses incurred by Beneficiary with respect to the audits, tests, inspections, and examinations which Beneficiary or its agents or employees may conduct, including without limitation, the fees of the engineers, laboratories, contractors, consultants, and attorneys, shall be paid by Trustor. All costs and expenses incurred by the trustee under this Deed of Trust and Beneficiary pursuant to this subparagraph (including without limitation, court costs, consultant fees and attorneys' fees Page 18 of 27 P32Q93\0140640012\2037442.3 09/16/93 • 382205 and costs, whether incurred in litigation or not and whether before or after judgment or on appeal) shall bear interest at the highest rate of interest set forth in the Secured Obligations from the date such expenses are incurred until all of said sums have been paid. (iii) To seek a judgment that Trustor has breached its covenants, representations and/or warranties with respect to environmental matters set forth in any of the Secured Obligations, by commencing and maintaining an action or actions in any court of competent jurisdiction for breach of contract pursuant to California Code of Civil Procedure Section 736, whether commenced prior to foreclosure of the Subject Property or after foreclosure of the Subject Property, and to seek the recovery of any and all costs, damages, expenses, fees, penalties, fines, judgments, indemnification payments to third parties, and other out-of-pocket costs or expenses actually incurred by Beneficiary (collectively, the "Environmental Costs") incurred or advanced by Beneficiary relating to the cleanup, remediation or other response action required by any applicable law or to which Beneficiary believes necessary to protect the Subject Property, it being conclusively presumed between Beneficiary and Trustor that all such Environmental Costs incurred or advanced by Beneficiary relating to the cleanup, remediation, or other response action of or to the Subject Property were made by Beneficiary in good faith. All Environmental Costs incurred by Beneficiary under this subparagraph (including without limitation, court costs, consultant fees and attorneys' fees and costs, whether incurred in litigation or not and whether before or after judgment or on appeal) shall bear interest at the highest rate of interest specified in the Secured Obligations from the date of expenditure until all of said sums have been paid. Beneficiary shall be entitled to bid, at the sale of the Subject Property held pursuant to this Deed of Trust, the amount of said costs, expenses and interest in addition to the amount of the other obligations hereby secured as a credit bid, the equivalent of cash. (iv) To waive its lien against the Subject Property or any portion thereof, whether fixtures or personal property, to the extent such property is found to be environmentally impaired in accordance with California Code of Civil Procedure Section 726 . 5 and to exercise any and all rights and remedies of an unsecured creditor against Trustor and all of the assets and property of Trustor for the recovery of any deficiency and Environmental Costs, including without limitation, seeking an attachment order under California Code of Civil Procedure Section 483 . 010 . As between Beneficiary and Trustor, for purposes of California Code of Civil Procedure Section 726 .5, Trustor shall have the burden of proving that Trustor or any related party (or any affiliate or Page 19 of 27 PS2\383\014094-0012\2037442.3 09/16/93 • 0 382205 agent of Trustor or any related party) was not in any way negligent in permitting the release or threatened release of the hazardous substances . Trustor hereby waives any requirement under California Code of Civil Procedure Section 726 . 5 (c) to require Beneficiary to foreclose against any other collateral for the obligations secured by this Deed of Trust prior to Lender electing any remedy permitted under said Code section. (v) Trustor acknowledges and agrees that, notwithstanding any term or provision contained herein or in the Secured Obligations, all judgments and awards entered against Trustor pursuant to subparagraphs (iii) and (iv) above shall be exceptions to any nonrecourse or exculpatory provisions of the Secured Obligations, and Trustor shall be fully, personally and jointly and severally liable for all judgments and awards entered against Trustor under subparagraphs (iii) and (iv) above, and such liability shall not be limited to the original principal amount of the obligations secured by this Deed of Trust and the obligations of Trustor shall survive the foreclosure, deed in lieu of foreclosure, release, reconveyance, or any other transfer of the Subject Property or this Deed of Trust . For the purposes of any action brought under subparagraphs 5 . 15 (iii) and (iv) above, Trustor hereby waives the defense of laches and any applicable statute of limitation. (vi) All rights and remedies of Beneficiary hereunder are cumulative and in addition to all rights and remedies provided by law. ARTICLE VI . EVENT OF DEFAULT PROVISIONS 6 . 01 Event of Default . "Event of Default" shall mean (a) the failure to perform any obligation hereunder, or the failure to be true of any representation or warranty of Trustor contained herein and the continuance of such failure for thirty (30) days after notice if such event is a monetary default or thirty (30) days after notice if such event is a non-monetary default; provided, however, that if such non-monetary default cannot be cured within said thirty (30) day period, Trustor shall not have commenced to cure the default within ten (10) days of said notice, or failed to diligent prosecute the same to completion, or (b) the existence of any Event of Default under the HRA, the Regulatory Agreement or any other Secured Obligation. 6 . 02 Rights and Remedies . At any time after Event of Default, Beneficiary and Trustee shall have all the following rights and remedies: Page 20 of 27 F32\393\014094-0012\2037442.3 09/16/93 38220s (a) With or without notice, to declare all Secured Obligations immediately due and payable; (b) With or without notice, and without releasing Trustor from any Secured Obligation, and without becoming a mortgagee in possession, to cure any breach or default of Trustor, and in connection therewith, to enter upon the Subject Property and to do such acts and things as Beneficiary or Trustee deem necessary or desirable to protect the security hereof including, but without limitation, to appear in and defend any action or proceeding purporting to affect the security hereof or the rights or powers of Beneficiary or Trustee hereunder; to pay, purchase, contest or compromise any encumbrance, charge, lien or claim of lien which, in the sole judgment of either Beneficiary or Trustee, is or may be senior in priority hereto, the judgment of Beneficiary or Trustee being conclusive as between the parties hereto; to obtain insurance; to pay any premiums or charges with respect to insurance required to be carried hereunder; and to employ counsel, accountants, contractors and other appropriate persons to assist them; (c) To commence and maintain an action or actions in any court of competent jurisdiction to foreclose this instrument as a mortgage or to obtain specific enforcement of the covenants of Trustor hereunder, and Trustor agrees that such covenants shall be specifically enforceable by injunction or any other appropriate equitable remedy and that for the purposes of any suit brought under this subparagraph, Trustor waives the defense of laches and any applicable statute of limitations; (d) To apply to a court of competent jurisdiction for and obtain appointment of a receiver of the Subject Property as a matter of strict right and without regard to (i) the adequacy of the security for the repayment of the Secured Obligations, (ii) the existence of a declaration that the Secured Obligations are immediately due and payable, or (iii) the filing of a notice of default; and Trustor consents to such appointment; (e) To enter upon, possess, manage and operate the Subject Property or any part thereof; to take and possess all documents, books, records, papers and accounts of Trustor or the then owner of the Subject Property; to make, terminate, enforce or modify Leases upon such terms and conditions as Beneficiary deems proper; to make repairs, alterations and improvements to the Subject Property necessary, in Trustee' s or Beneficiary' s judgment, to protect or enhance the security hereof; Page 21 of 27 PS2\393\014011-0012\2037"2.3 09/16/93 352205 (f) To execute a .written notice of such Event of Default and of its election to cause the Subject Property to be sold to satisfy the Secured Obligations . Trustee shall give and record such notice as the law then requires as a condition precedent to a trustee' s sale. When a minimum period of time required by law after such notice has elapsed, Trustee, without notice to or demand upon Trustor except as required by law, shall sell the Subject Property at the time and place of sale fixed by it in the notice of sale, at one or several sales, either as a whole or in separate parcels and in such manner and order, all as Beneficiary in its sole discretion may determine, at public auction to the highest bidder for cash, in lawful money of the United States, payable at time of sale. Neither Trustor nor any other person or entity other than Beneficiary shall have the right to direct the order in which the Subject Property is sold. Subject to requirements and limits imposed by law, Trustee may postpone sale of all or any portion of the Subject Property by public announcement at such time and place of sale, and from time to time may postpone the sale by public announcement at the time and place fixed by the preceding postponement. Trustee shall deliver to the purchaser at such sale a deed conveying the Subject Property or portion thereof so sold, but without any covenant or warranty, express or implied. The recitals in the deed of any matters or facts shall be conclusive proof of the truthfulness thereof. Any person, including Trustee, Trustor or Beneficiary may purchase at the sale; (g) To resort to and realize upon the security hereunder and any other security now or later held by Beneficiary concurrently or successively and in one or several consolidated or independent judicial actions or lawfully taken non-judicial proceedings, or both, and to apply the proceeds received upon the Secured Obligations all in such order and manner as Trustee and Beneficiary or either of them determine in their sole discretion. (h) At any sale of the Subject Property held pursuant to Section 6 . 02 (c) or Section 6 . 02 (f) above, Beneficiary may bid, as the equivalent of cash, the amount of all or any of the Secured Obligations, including, without limitation, attorney' s fees. 6. 03 Application of Foreclosure Sale Proceeds . After deducting all costs, fees and expenses of Trustee, and of this trust, including cost of evidence of title and attorney' s fees in connection with sale, Trustee shall apply all proceeds of any foreclosure sale to payment of : all sums expended by Beneficiary under the terms hereof and not then repaid, with accrued interest at the greatest effective rate of interest specified in the Note to be applicable on or after maturity or acceleration of the Note; the payment of all other Secured Obligations in such order and amounts Page 22 of 27 P32136310140L4001212037442.3 09/16M • :3822®5 as Beneficiary in its sole ,discretion determines; and the remainder, if any, to the person or persons legally entitled thereto. 6 . 04 Application of Other Sums . All sums received by Bene- ficiary under Section 6 . 02 , less all costs and expenses incurred by it or the receiver under Section 6 . 02, including attorneys' fees shall be applied in payment of the Secured Obligations in such order as Beneficiary shall determine in its sole discretion (but Beneficiary shall have no liability for funds not actually received by Beneficiary) . 6 . 05 No Cure or Waiver. Neither Beneficiary' s nor Trustee's nor any receiver' s entry upon and taking possession of all or any part of the Subject Property, nor any collection of rents, issues, profits, insurance proceeds, condemnation proceeds or damages, other security or proceeds of other security, or other sums, nor the application of any collected sum to any Secured Obligation, nor the exercise of any other right or remedy by Beneficiary or Trustee or any receiver shall cure or waive any breach, Event of Default or notice of default under this Deed of Trust, or nullify the effect of any notice of default or notice of sale (unless all Secured Obligations then due have been paid and performed and Trustor has cured all other defaults) , or impair the status of the security, or prejudice Beneficiary or Trustee in the exercise of any right or remedy, or be construed as an affirmation by Beneficiary of any tenancy, lease or option or a subordination of the lien of this Deed of Trust . 6 . 06 Payment of Costs Expenses and A t rn y's F a . Trustor agrees to pay to Beneficiary immediately and without demand all costs and expenses incurred by Trustee and Beneficiary pursuant to subparagraphs (a) through (g) inclusive of Section 6 . 02 (including, but without limitation, court costs and attorneys' fees, whether incurred in litigation or not) with interest from the date of expenditure until said sums have been paid at the greatest effective rate of interest specified in the Note. 6 . 07 Power to File Notices and Cure Event of D faul a Trustor hereby irrevocably appoints Beneficiary and its successors and assigns, as its attorney-in-fact, which agency is coupled with an interest, (a) to execute and/or record any notices of completion, cessation of labor, or any other notices that Beneficiary deems appropriate to protect Beneficiary's interest, and (b) upon the occurrence of an event, act or omission which, with notice or passage of time or both, would constitute an Event of Default, Beneficiary may perform any obligation of Trustor hereunder; provided, that (i) Beneficiary as such attorney-in-fact shall only be accountable for such funds as are actually received by Beneficiary; and (ii) Beneficiary shall not be liable to Trustor or any other person or entity for any failure to act under this Section. Page 23 of 27 P52\333\014034-0012\2037442.3 09/16/93 • 382205 6.08 TrLstOr Non-Profit Beneficiary acknowledges that it has received financial statements of Trustor from Trustor, and that Trustor is a nonprofit public benefit corporation without members and without assured sources of funding or capital. Notwithstanding any provision or obligation to the contrary contained in this Deed of Trust, (a) the liability of Trustor under this Deed of Trust to Beneficiary and its successors and assigns, is limited to Trustor's interest in the Project and the Property and Beneficiary shall look exclusively thereto, or to such other security as may from time to time be given for the payment of obligations arising out of the Note or this Deed of Trust or any other agreement secured by this Deed of Trust; and (b) from and after the date of this Deed of Trust, no deficiency or other personal judgment, nor any order or decree of specific performance (other than pertaining to this Deed of Trust, any agreement pertaining to the Property or the Project or any other agreement securing Trustor's obligations under the Note) , shall be rendered against: (i) Trustor; (ii) the assets of Trustor (other than Trustor's interest in the Project or the Property and the rents, issues and profits thereof, any agreement pertaining to the Property or any other agreement securing Trustor's obligations under the Note) ; or (iii) its officers, directors, agents or members or their heirs, personal representatives, successors, transferees or assigns, as the case may be, in any action or proceeding arising out of this Deed of Trust, or any agreement securing the obligations of Trustor under the Note, or any judgment, order or decree rendered pursuant to any such action or proceeding. Notwithstanding the foregoing, Trustor shall have personal liability for one hundred percent (100%) of the costs or damages arising from any of the following: (i) fraud or intentional material misrepresentation which induce Beneficiary to enter into the transaction evidenced by the HRA and the documents referred to therein, including the Note, this Deed of Trust and the Regulatory Agreement; (ii) commission of waste; (iii) causing cancellation of any of the insurance required pursuant to this Deed of Trust; (iv) intentional failure to observe and comply with all applicable laws, ordinances, regulations; and (v) the intentional misapplication of (a) proceeds paid, prior to any foreclosure of the Property, under any insurance policy by reason of damage, loss, or destruction to any portion of the Property (to the full extent of such proceeds) ; (b) any proceeds or awards resulting from the condemnation, prior to any foreclosure, of all or any part of the Property (to the full extent of such proceeds or awards) ; and/or (c) gross receipts from rental of the Property received or applicable to a period prior to any foreclosure of the Property, after notice of default, which gross receipts are deemed to be the property of Beneficiary, including without limitation, the collection and retention of any such gross receipts after any notice of default or foreclosure or exercise of other remedies by Beneficiary (following any applicable cure periods) has been given to Trustor. Page 24 of 27 P32383\O14ON-0012W7442.3 0923/93 • 382205 ARTICLE VII. MISCELLANEOUS PROVISIONS 7 . 01 Additional Provisions . The HRA and the documents referred to therein contain or incorporate by reference the entire agreement of the parties with respect to matters contemplated herein and supersede all prior negotiations . The HRA grants further rights to Beneficiary and contains further agreements and affirmative and negative covenants by Trustor which apply to this Deed of Trust and to the Subject Property and such further rights and agreements are incorporated herein by this reference. 7 . 02 Mercrer. No merger shall occur as a result of Bene- ficiary' s acquiring any other estate in, or any other lien on, the Subject Property unless Beneficiary consents to a merger in writing. 7. 03 Rules of Construction. When the identity of the parties or other circumstances make it appropriate, the masculine gender includes the feminine and/or neuter, and the singular number includes the plural . The term "Subject Property" means all and any part of the Subject Property. 7. 04 Successors in Interest. The terms, covenants, and conditions herein contained shall be binding upon and inure to the benefit to the heirs, successors and assigns of the parties hereto; provided, however, that this Section does not waive the provisions of Section 5 . 11. 7. 05 Incorporation. Exhibit 1-1" , as attached, is incorporated into this Deed of Trust by this reference. 7 . 06 Addresses ; Request for Notice. Notice to Beneficiary shall be sent to Beneficiary addressed to: The Community Redevelopment Agency of the City of Palm Springs, California 3200 E. Tahquitz Canyon Way P.O. Box 3200 Palm Springs CA 92263 Attn: Executive Director Any Trustor whose address is set forth below hereby requests that a copy of notice of default and notice of sale be mailed to him at that address. Failure to insert an address shall constitute a designation of Trustor' s last known address as the address for such notice. Page 25 of 27 FS1\313k0140V_W12149937.1 3,92205 IN WITNESS WHEREOF, Trustor has executed this Deed of Trust on the date of Trustor' s acknowledgment hereinbelow, to be effective for all purposes as of the day and year first set forth above. TRUSTOR: CORPORATE FUND FOR HOUSING, a California nonprofit- public benefit corporatio By. Its. �— By: Its: Address 100 Pacifica, Suite 470 Irvine, CA 92718 Attn: Barry Kamel Page 26 of 27 F51M310140{1-0013149837.1 ;3822®5 STATE OF CALIFORNIA ) ss. COUNTY OF O e 4wGE ) On SF�rF.- ar�r �� /951 bef ore me, _ �v ✓� �i� lyzicv personally appeared RpL�y 7-,v /fr peXc0na-l-iy knowm me (or proved to me on the basis of satisfac- tory evidence) to be the persons) whose name (-s-) is/-a-re. subscribed to the within instrument and acknowledged to me that he/-s-hefth-ey executed the same in his/hsr/tha17r authorized capacity(ies-) , and that by his/her-/th-eir signature(s) on the instrument the person.(, ) or the entity upon behalf of which the person(-s) acted, executed the instrument. Witness my hand and official seal . JUNE M.tAZICH otary blic [SEAL] COMM.#r 919640 Notary Public—California ORANGE COUNTY My Comm,Expire:;MAY 12.1M Page 27 of 27 FS1\393\0110UM12119937.1 • 3,92205 CERTIFICATE OF ACCEPTANCE (California Government Code § 27281) Deed of Trust with Assignment of Rents, Security Agreement and Fixture Filing This is to certify that the interest in real property conveyed or assigned by the foregoing Deed of Trust dated as of September 28, 1993 from Corporate Fund for Housing, a California non-profit public benefit corporation, to The Community Redevelopment Agency of the City of Palm Springs, California, a political corporation and governmental agency ("Agency") , is hereby accepted by the undersigned officer or agent on behalf of the Agency pursuant to authority conferred by resolution of the Agency adopted on August 4, 1983 , and the Agency consents to the recordation thereof by the undersigned as its duly authorized officer or agent. THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNI — —_ FS2\146\014084-0069\2066178. 09/28/93 382205 EXHIBIT "111 DESCRIPTION OF PROPERTY That certain real property located in the County of Riverside, State of California, legally described as follows: LOT 15 IN SECTION 13 , TOWNSHIP 4 SOUTH, RANGE 4 EAST, SAN BERNARDINO MERIDIAN, AS PER MAP OF PALM VALLEY COLONY LANDS, RECORDED IN BOOK 14, PAGE 652 OF MAPS, SAN DIEGO COUNTY RECORDS; EXCEPT THAT PORTION LYING NORTH OF THE SOUTH LINE OF ENCHANTED HOMES UNIT NO. 1, RECORDED IN BOOK 34, PAGE 17 OF MAPS, RIVERSIDE COUNTY RECORDS. SAID PROPERTY IS SHOWN ON RECORD OF SURVEY ENTITLED "RECORD OF SURVEY OF A PORTION OF LOT 15 OF SECTION 13 , TOWNSHIP 4 SOUTH, RANGE 4 EAST, SAN BERNARDINO MERIDIAN, AS SHOWN BY MAP OF PALM VALLEY COLONY LANDS AS RECORDED IN BOOK 14, PAGE 652 OF MAPS, SAN DIEGO COUNTY RECORDS" ON FILE IN BOOK 33 , PAGE 77 OF RECORDS OF SURVEY, RIVERSIDE COUNTY RECORDS. SAID LAND IS LOCATED IN THE CITY OF PALM SPRINGS. EXHIBIT "1" FSI\383\014084-0012\.51195.1 07/23/93 �'NiCAGG TM.F N, f 0 � O LU Y FREE RECORDING REQUESTED BY W AND WHEN RECORDED MAIL TO: O lLL I C1 . The Community Redevelopment Agency G of the City of Palm Springs, California W do Uj $ P.O. Box 2743 - < N 1 ; Q Palm Springs, California 92263-2743 N Ul s Attn: Executive Director 0 C m � X x (Space Above This Line for Recorder's Office Use Onho x a m tl N • i I - I 0 S� REGULATORY AGREEMENT AND c c DECLARATION OF COVENANTS AND RESTRICTIONS Iic iNW I- � z � •r- THIS REGULATORY AGREEMENT AND DECLARATION OF COVENANTS M 0 ¢w RESTRICTIONS ( " egulatory Agreement") is made and entered into thi' So- o,cw)� v 20 day of rn�ca�t� 1993 , by and between THE COMMUNI7 ,_, � ¢ w_ _ REDEVELOPMENT A ENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA, a public body, corporate and politic ( "Agency") and CORPORATE FUND FOR HOUSING, a California nonprofit public benefit corporation ( "Developer" ) . R E C I T A L Ste: A. Pursuant to a Housing Rehabilitation Agreement by and between Agency and Developer (the IIHRAII ) , Agency has granted Developer the principal sum of FIVE HUNDRED NINETY THOUSAND DOLLARS ($590, 000 . 00) ( "Grant") from the Agency' s Affordable Housing Set- Aside Fund for the purpose of rehabilitating the improvements located on that certain real property in the City of Palm Springs, State of California and more particularly described in Exhibit "1" , attached hereto and incorporated by reference herein (the "Site") pursuant to the terms of the HRA. B. Developer has executed a Promissory Note Secured by Deed of Trust of even date herewith ( "Note") and the Note is secured by that certain Deed of Trust with Assignment of Rents, Security Agreement and Fixture Filing of even date herewith ( "Deed of Trust" ) to assure the repayment of all or a portion of the Grant if an Event of Default occurs under the Deed of Trust, the HRA or this Regulatory Agreement, as such term is defined therein and herein. C. The Agency and/or the City of Palm Springs ("City" ) has certain fee or easement interests in various streets, sidewalks, Page 1 of 22 MU83\014094-0012\2037441.5 09/27/93 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 and/or the City' s interests in real property most directly affected by this Regulatory Agreement is depicted in Exhibit "2" attached hereto and incorporated herein by reference ( "Public Parcel") . D. Agency and Developer now desire to place restrictions upon the use and operation of the Project, in order to ensure that the Project shall be continuously made available to persons of very low income and low income for the terns of this Regulatory Agreement . It is the intent of the parties that title to the Site shall be subject to this Regulatory Agreement and that the terms hereof shall be binding on the Developer and its successors in interest in the Site for so long as this Regulatory Agreement shall remain in effect. E. The parties further intend that the Developer, in exchange for the Agency entering into the HRA, shall hold, sell, and convey the Site subject to the covenants, conditions, restric- tions and reservations set forth in this Regulatory Agreement and that the Agency and the City shall have the right and power to enforce the covenants, conditions, restrictions and reservations as provided herein. NOW, THEREFORE, the Developer 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, all of which are declared to be in furtherance of a common plan for the improvement and sale of the Site, used, sold, conveyed, leased and occupied, subject to the covenants and restrictions hereinafter set forth, and are established expressly and exclusively for the use and benefit of the Site, each and every person and entity who may now or in the future own the Site, the Agency and the City. 1 . DEFINITIONS. 1. 1 "Adjusted Income" - means the adjusted income of all persons who intend to reside in one residential unit, calculated in the manner determined by the United States Department of Housing and Urban Development pursuant to Section 8 of the United States Housing Act of 1937 . 1 .2 "Area" - means Riverside-San Bernardino, California, Primary Metropolitan Statistical Area. 1 . 3 "Certificate of Continuing Program Compliance" - means the certificate with respect to the Project to be filed by the Developer with the Agency, which shall be substantially in the Page 2 of 22 F52N393\014094-0012\2037441.3 09/27/93 i 382201 form attached hereto as Exhibit 114" and incorporated herein by reference. 1.4 "Certificate of Completion" - means the Certificate of Completion to be recorded against the Property pursuant to Section 4 . 11 of the HRA upon completion of the Project . 1. 5 "Income Computation and Certification" - means that certain certificate attached hereto as Exhibit 113 " and incorporated herein by reference. 1. 6 "Low Income Tenants" - means individuals or families with an Adjusted Income which does not exceed eighty percent (8096) of the Median Income for the Area as adjusted for actual household size as determined by the Department of Housing and Urban Development pursuant to Section 8 of the United States Housing Act of 1937. In no event, however, will the occupants of a residential unit be considered to be Low Income Tenants if all the occupants are Students, no one of which is entitled to file a joint federal income tax return. 1 . 7 "Low Income Units" - means the dwelling units in the Project designated for occupancy by Low Income Tenants pursuant to Section 3 (a) (1) of this Regulatory Agreement. 1. 8 "Median Income for the Area" - means the median income for the Area as most recently determined by the Department of Housing and Community Development pursuant to Section 8 of the United States Housing Act of 1937. 1 .9 "Oualified Project Period" - means the period date the Certificate of Completion is recorded in the Office of the Riverside County Recorder and continuing for a period of thirty (30) years . 1 . 10 "Student" - means a student as defined in Section 151 (c) (4) of the Code, as such may be amended. Currently, Section 151 (c) (4) defines a student as an individual enrolled as a full- .time student during each of five (5) calendar months during the calendar year in which occupancy of the unit begins at an educational organization which normally maintains a regular faculty and curriculum and normally has a regularly enrolled body of students in attendance or is an individual pursuing a full-time course of institutional on-farm training under the supervision of an accredited agent of such an educational organization or of a state or political subdivision thereof . 1. 11 "Very Low Income Tenants" - means individuals or families with an 'Adjusted Income which does not exceed fifty percent (50i) of the Median Income for the Area as adjusted for household size as set forth in Section 1. 7 above. In no event, however, will the occupants of a residential unit be considered to Page 3 of 22 PS2\389\014014-0012\2037"1.5 09/27/93 • 3S2201 be Very Low Income Tenants if all the occupants are Students, no one of which is entitled to file a joint federal income tax return. 1. 12 "Very Low Income Units" - means the dwelling units in the Project designated for occupancy by Very Low Income Tenants pursuant to Section 3 (a) (1) of this Regulatory Agreement. 2 . RESIDENTIAL RENTAL PROPERTY. The Developer hereby acknowledges and agrees that the Project will be owned, managed and operated such that forty percent (40W) of the units located in the Project shall be made available to Very Low Income Tenants and sixty percent (60t) of the units located in the Project shall be made available to Low Income Tenants until the expiration of the Qualified Project Period. To that end, and for the term of this Regulatory Agreement, the Developer hereby represents, as of the date hereof, and covenants, warrants and agrees as follows: (a) The Project is being or has been rehabilitated for the purpose of providing multifamily residential rental property, and the Developer shall own, manage and operate the Project as a project to provide multifamily residential rental property comprised of a building or structure or several interrelated buildings or structures, together with any functionally related and subordinate facilities, and no other facilities . As used herein, functionally related and subordinate facilities shall include facilities for use by the tenants, including, for example, swimming pools, other recreational facilities, parking areas, and other facilities which are reasonably required for the Project, for example, heating and cooling equipment, trash disposal equipment and units for resident managers or maintenance personnel. (b) All of the dwelling units in the Project will be similarly constructed units, and each dwelling unit in the Project will contain facilities for living, sleeping, eating, cooking and sanitation for a single person or a family, which are complete, separate and distinct from other dwelling units, including a sleeping area, bathing and sanitation facilities and cooking facilities equipped with a cooking range, refrigerator and sink; provided that any Very Low Income Tenant or Low Income Tenant may, but shall not be obligated to, provide a refrigerator for the unit to be occupied. (c) Developer shall not knowingly permit any of the dwelling units in the Project to be utilized on a transient basis, and none of the dwelling units will ever be used as a hotel, motel, dormitory, fraternity house, sorority house, rooming house, nursing home, hospital, sanitarium, rest home, retirement house or trailer court or park. Page 4 of 22 P5213931014014001212037441.5 09/27/93 (d) No part of the Project will at any time be owned by a cooperative housing corporation. Other than obtaining a final subdivision map on the Project and a Final Subdivision Public Report from the California Department of Real Estate, the Developer shall not take any steps in connection with a conversion of the Project to condominium ownership. (e) All of the dwelling units will be available for rental on a continuous basis to members of the general public and the Developer will not give preference to any particular class or group in renting the dwelling units in the Project, except that dwelling units are required to be leased or rented to Very Low Income Tenants and Low Income Tenants. Very Low Income Tenants and Low Income Tenants shall have equal access to and enjoyment of all common facilities of the Project. (f) The Site consists of a parcel or parcels that are contiguous except for the interposition of a road, street or stream, and all of the Project will comprise a single geographically and functionally integrated project for residential rental property, as evidenced by the ownership, management, accounting and operation of the Project. (g) No dwelling unit in the Project shall be occupied by the Developer unless the Project contains five or more dwelling units, in which case three (3) units may be occupied by the Developer or by persons related to or affiliated with the Developer such as a resident manager or maintenance personnel . 3 . VERY LOW INCOME TENANTS AND LOW INCOME TENANTS. The Developer hereby represents, as of the date hereof, and warrants, covenants and agrees as follows: (a) During the Qualified Project Period: (1) Forty percent (40t) of the completed units in the Project shall be designated as Very Low Income Units and shall be continuously occupied by Very Low Income Tenants and sixty percent (604) of the completed units in the Project shall be designated as Low Income Units and shall be continuously occupied by Low Income Tenants. Such Very Low Income Units and Low Income Units shall be of comparable quality and offer a range of sizes and number of bedrooms proportionate to the total units in the Project and such units shall be proportionately distributed throughout the Project. (2) The monthly rent charged for all the Very Low Income Units shall not exceed one-twelfth of the amount Page 5 of 22 F52\383\0140U-0012\203744I.3 09/27/93 • • JUNMV i obtained by multiplying 30W times 504 of the Median Income for the Area, as adjusted for household size. In adjusting rent for household size for this purpose, it shall be assumed that one (1) person will occupy a studio unit, two (2) persons will occupy a one-bedroom unit, three (3) persons will occupy a two-bedroom unit, four (4) persons will occupy a three-bedroom unit and five (5) persons will occupy a four-bedroom unit. (3) The monthly rent charged for all the Low Income Units shall not exceed one-twelfth of the amount obtained by multiplying 30% times 8096 of the Median Income for the Area, as adjusted for household size. In adjusting rent for household size for this purpose, it shall be assumed that one (1) person will occupy a studio unit, two (2) persons will occupy a one-bedroom unit, three (3) persons will occupy a two-bedroom unit, four (4) persons will occupy a three-bedroom unit and five (5) persons will occupy a four-bedroom unit. A unit occupied by a Very Low Income Tenant or a Low Income Tenant who at the commencement of the occupancy is a Very Low Income Tenant or a Low Income Tenant, respectively, shall be treated as occupied by a Very Low Income Tenant or a Low Income Tenant, respectively, until a recertification of such tenant' s income in accordance with Section 3 (c) below demonstrates that such tenant no longer qualifies as a Very Low Income Tenant or a Low Income Tenant and thereafter any residential unit of comparable size in the Project is occupied by a new resident other than a Very Low Income Tenant or a Low Income Tenant, respectively. Moreover, a unit previously occupied by a Very Low Income Tenant or a Low Income Tenant and then vacated shall be considered occupied by a Very Low Income Tenant or a Low Income Tenant until reoccupied, other than for a temporary period, at which time the character of the unit shall be redetermined. In no event shall such temporary period exceed thirty-one (31) days. The parties hereto acknowledge that as of the date Developer takes title to the Site, certain tenants that occupy the Project may not qualify as Low Income Tenants or Very Low Income Tenants. Notwithstanding anything contained in this Regulatory Agreement to the contrary, Developer shall not be required to remove said tenants and said tenants may remain in the Project until said tenants breach their rental agreements or elect to move voluntarily. (b) Immediately prior to a Very Low Income Tenant's or Low Income Tenant' s occupancy of a Very Low Income Unit or a Low Income Unit, respectively, the Developer will obtain and maintain on file an Income Computation and Certification form from each such Very Low Income Tenant or Low Income Tenant Page 6 of 22 FS2\393\014034-0012\2037441.5 09/27/93 20 382 dated immediately prior to the date of initial occupancy in the Project by such Very Low Income Tenant or Low Income Tenant. In addition, the Developer will provide such further information as may be required in the future by the Agency. The Developer shall use its best efforts to verify that the income provided by an applicant is accurate by taking the following steps as a part of the verification process: (1) obtain three (3) pay stubs for the most recent pay periods, (2) obtain a federal income tax return for the most recent tax year, (3) obtain a written verification of income and employment from applicant' s current employer in the form attached as an exhibit to the Income Computation and Certification, (4) obtain an income verification form from the Social Security Administration and/or California Department of Social Services if the applicant receives assistance from either agency, (5) if an applicant is unemployed or did not file a tax return for the previous calendar year, obtain other verification of such applicant' s income as is satisfactory to the Agency or (6) such other information as may be requested by the Agency. A copy of each such Income Computation and Certification shall be filed with the Agency prior to the occupancy of the Very Low Income Tenant or Low Income Tenant whenever possible, but in no event more than thirty (30) days after initial occupancy by said tenant . (c) Immediately prior to the first anniversary date of the occupancy of a Very Low Income Unit or Low Income Unit by one or more Very Low Income Tenants or Low Income Tenants, respectively, and on each anniversary date thereafter, the Developer shall recertify the income of the occupants of such Very Low Income Unit or Low Income Unit by obtaining a completed Income Computation and Certification based upon the current income of each occupant of the unit. In the event the recertification demonstrates that such household' s income exceeds one hundred forty percent (140t) of the income at which such household would qualify as Very Low Income Tenants or Low Income Tenants, such household will no longer qualify as a Very Low Income Tenant or Low Income Tenant; provided that, however, if the occupants were qualified as Very Low Income Tenants, then the occupants will be qualified as Low Income Tenants, if the occupants satisfy the requirements specified in Section 3 (a) (3) above upon recertification, and, in such event, the Developer will rent the next available unit of comparable size to one or more Very Low Income Tenants. If the occupants do not qualify as Low Income Tenants, then the occupants lease shall not be renewed and said occupants shall be required to vacate the unit upon the expiration of the lease. Developer shall provide the Agency with a copy of each such recertification with the next submission of Certificate of Continuing Program Compliance pursuant to Section 3 (d) . Page 7 of 22 rs2\393\014094-0012\2037441.5 09m/93 (d) Upon the commencement of the Qualified Project Period, and within thirty (30) days of the last day of each calendar quarter thereafter during the term of this Regulatory Agreement commencing thirty (30) days following December 31, 1993 , the Developer shall advise the Agency of the occupancy of the Project by delivering a Certificate of Continuing Program Compliance stating (i) the percentage of the dwelling units of the Project which were occupied or deemed occupied, pursuant to subsection (a) hereof, by Very Low Income Tenants and Low Income Tenants during such period and (ii) that to the knowledge of Developer either (A) no unremedied default has occurred under this Regulatory Agreement or (B) a default has occurred, in which event the certificate shall describe the nature of the default and set forth the measures being taken by the Developer to remedy such default. The Developer also will prepare and submit to the Agency in form and substance satisfactory to the Agency, within thirty (30) days after March 31 and September 30 of each year, a report summarizing the vacancy rate of the Project on a month-to-month basis for the prior six (6) months . The Developer also will prepare and submit to the Agency in a form and substance satisfactory to the Agency, within thirty (30) days after September 30 of each year, commencing with September 30, 1994, a report summarizing the vacancy rate of the Project on a month-to-month basis for the prior twelve (12) months. (e) The Developer will maintain complete and accurate records pertaining to the Very Low Income Units and Low Income Units, and will permit any duly authorized representative of the Agency to inspect the books and records of the Developer pertaining to the Project upon reasonable written notice, including those records pertaining to the incomes of the Very Low Income Tenants and Low Income Tenants. (f) The Developer shall accept as tenants on the same basis as all other prospective tenants, persons who are recipients of federal certificates or vouchers for rent subsidies pursuant to the existing program under Section 8 of the United States Housing Act of 1937, or its successor. The Developer shall not apply selection criteria to Section 8 certificate or voucher holders that are more burdensome than criteria applied to all other prospective tenants. (g) Each lease pertaining to a Very Low Income Unit and Low Income Unit shall contain a provision to the effect that the Developer has relied on the income certification and supporting information supplied by the Very Low Income Tenant or Low Income Tenant in determining qualification for occupancy of the Very Low Income Unit or Low Income Unit, and that any material misstatement in such certification (whether or not intentional) will be cause for immediate termination of such lease. Each lease will also contain a provision that Page 8 of 22 PS2\393\01409"12\2037441.5 09/27/93 failure to cooperate with the annual recertification process reasonably instituted by the Developer pursuant to Section 4 (c) above may at the option of the Developer disqualify the unit as a Very Low Income Unit or Low Income Unit or provide grounds for termination of the lease. (h) During the term of this Regulatory Agreement, Declarant shall use its best efforts to lease vacant Very Low Income Units and Low Income Units to residents of the City of Palm Springs prior to offering to rent such units to any other person. Agency shall maintain a list (the "Housing List" ) of persons who have notified Agency of their desire to rent a unit in the Project and who have incomes which would qualify them as Very Low or Low Income Tenants and Developer shall offer to rent on a priority basis the Very Low Income Units and Low Income Units to the persons on the Housing List who are residents of the City of Palm Springs. Developer shall also advertise the available units in a newspaper of general circulation in the City of Palm Springs at least once per week for a minimum of four weeks. If Declarant is unable to locate a Very Low or Low Income Tenant who is a resident of the City of Palm Springs within a reasonable time, but not less than thirty (30) days from the date the unit becomes vacant, the Declarant may rent the unit to a Very Low or Low Income Tenant, as the case may be, who is not a resident. Nothing contained herein shall require Developer to offer to rent said units to persons on terms and conditions which are more favorable than the terms and conditions on which such units will be offered to the public generally. (i) If after and despite Developer's best efforts, Developer is unable to rent a Very Low Income Unit to a Very Low Income Tenant, Developer may rent said unit to a Low Income Tenant, except as specifically prohibited by the terms of the Bond Regulatory Agreement, as hereinafter defined. For the purposes of this Regulatory Agreement, Developer will have been deemed to have used its best efforts if it (i) has advised the Agency in writing as to the unit's availability and has thereafter offered said unit to all of the persons on the Housing List maintained by Agency pursuant to subsection (h) above; and (ii) has advertised said unit at the then applicable rental rate at least weekly in a newspaper of general circulation for a period of two (2) months from the date the unit is vacated. Developer' s obligation to offer the unit to persons on the Agency' s Housing List shall be satisfied only if Developer has offered the unit to all persons on or added to the Housing List within two (2) months following the date of the Developer's notice of the unit' s availability. (j ) If after and despite Developer's best efforts, Developer is unable to rent a Low Income Unit to a Low Income Page 9 of 22 PS2\3E3\014OS4-001212037441.5 09/27M Tenant or a Very Low Income Unit to a Low Income Tenant as provided in subsection (i) above, Developer may rent said unit to persons who do not qualify as a Low Income Tenant or a Very Low Income Tenant on a month-to-month basis; provided that the rental agreement with said non-qualified person(s) shall specifically state that the lease is terminable upon thirty (30) days notice for any reason whatsoever, including the location of a Very Low Income Tenant or a Low Income Tenant. For the purposes of this Regulatory Agreement, Developer will have been deemed to have used its best efforts if it (i) has advised the Agency in writing as to the unit' s availability and has thereafter offered said unit to all of the persons on the Housing List maintained by Agency pursuant to subsection (h) above; and (ii) has advertised said unit at the then applicable rental rate at least weekly in a newspaper of general circulation for a period of three (3) months from the date the unit is vacated. Developer' s obligation to offer the unit to persons on the Agency' s Housing List shall be satisfied only if Developer has offered the unit to all persons on or added to the Housing List within three (3) months following the date of the Developer's notice of the unit' s availability. Upon renting the unit to non-qualified person(s) , Developer shall continue to use its best efforts to locate a Very Low Income Tenant or Low Income Tenant for the unit by consulting the Housing List and advertising the unit as provided in subsection (h) . Further, during a rental to a non-qualified person(s) , Developer shall certify to the Agency that despite its best efforts, Developer has been unable to locate a Very Low Income Tenant or a Low Income Tenant to occupy the unit. 4 . MAINTENANCE. 4 .1 Maintenance Obligation. Developer shall maintain and operate the Site, and all landscaping, open space, common areas, improvements and structures upon the Site in good order, condition and repair, and shall keep the entire Site free from any accumulation of debris or waste materials or other nuisances. Developer shall also maintain all landscaping on the Site in a healthy condition and replace any deteriorated or dead landscaping. The Site shall be maintained in accordance with all City codes, laws, regulations and ordinances, as they now exist or may be amended. Developer shall maintain the Site in such a manner as to avoid the reasonable determination of a duly authorized officer of the Agency or City that a public nuisance has been created such as to be detrimental to public health, safety or general welfare, or that such a condition of deterioration or disrepair causes appreciable harm . or is materially detrimental to surrounding property or improvements . Page 10 of 22 F=383\014084-001212037441.5 09/27/93 138202 4 .2 Right of Entry. In the event Developer fails to maintain the Site in the above-mentioned condition, and satisfactory progress is not made in correcting the condition within thirty (30) days from the date of written notice from Agency, City or Agency may, at their option, and without further notice to Developer, declare the unperformed maintenance to constitute a public nuisance. Thereafter, either Agency or City, their employees, contractors or agents, may cure Developer' s default by entering upon the Site and performing the necessary landscaping and/or maintenance. The Agency or City shall give Developer, its representative or the residential manager reasonable notice of the time and manner of entry, and entry shall only be at such times and in such manner as is reasonably necessary to carry out this Regulatory Agreement . Developer shall pay such costs as are reasonably incurred by Agency or City for such maintenance. 4 .3 Lien. If the costs incurred pursuant to Section 4.2 are not reimbursed within thirty (30) days after Developers' receipt of notice thereof, the same shall be deemed delinquent, and the amount thereof shall bear interest thereafter at a rate of ten percent (10W) per annum until paid. Any and all delinquent amounts, together with said interest, costs and reasonable attorney' s fees, shall be a lien and charge, with power of sale, upon the property interests of Developer, and the rents, issues and profits of such property. City and/or Agency may bring an action at law against Developer obligated to pay any such sums or foreclose the lien against Developer's property interests. Any such lien may be enforced by sale by the City or Agency following recordation of a Notice of Default of Sale given in the manner and time required by law as in the case of a deed of trust; such sale to be conducted in accordance with the provisions of Section 2924, et sea. , of the California Civil Code, applicable to the exercise of powers of sale in mortgages and deeds of trust, or in any other manner permitted by law. Any monetary lien provided for herein shall be subordinate to any bona fide mortgage or deed of trust covering an ownership interest in and to the Site, and any purchaser at any foreclosure or trustee' s sale (as well as any deed or assignment in lieu of foreclosure or trustee' s sale) under any such mortgage or deed of trust shall take title free from any such monetary lien, but otherwise subject to the provisions hereof; provided that, after the foreclosure of any such mortgage and/or deed of trust, all other assessments provided for herein to the extent they relate to the expenses incurred subsequent to such foreclosure, assessed hereunder to the purchaser at the foreclosure sale, as owner of the subject parcel after the date of such foreclosure sale, shall become a lien upon such parcel upon recordation of a Notice of Assessment or Notice of Claim of Lien as herein provided. Page 11 of 22 PSMUN0140944001=037M1.5 09/27/93 5 . COMPLIANCE WITH ORDINANCES. 5 . 1 Declarant shall comply with all ordinances, regulations and standards of the City and Agency applicable to the Property, including the rent control ordinance of the City. 5 .2 Declarant shall provide any proposed tenants of any portion of the Property with a copy of the conditions to approval of the Project and this Regulatory Agreement and shall, prior to entering into any lease agreement, have the proposed tenant execute an affidavit agreeing to comply with the provisions of this Regulatory Agreement . All lease agreements shall be in writing and shall contain provisions which make compliance with the conditions of the Site Plan and this Regulatory Agreement and the requirements of the City relating to signs, permits and business licenses express covenants of the Lease. 5 . 3 Declarant shall comply with all rules and regula- tions of any assessment district of the City with jurisdiction over the Property. 6 . LIMITATION ON TRANSFERS . 6 . 1 Definition of Transfer. The term "Transfer" shall mean any assignment, hypothecation, mortgage, pledge, conveyance, lease (exclusive of renting the dwelling units) , sale, exchange, gift, or encumbrance of all or any portion of this Agreement, the Site, or the improvements thereon, whether voluntary, involuntary or by operation of law. A Transfer shall also include the transfer to any person or group of persons acting in concert of twenty-five percent (25k) or more of the present ownership and/or control of Participant, taking all transfers into account on a cumulative basis . In the event Participant or its successor is a corporation or trust, such transfer shall refer to the transfer of the issued and outstanding voting rights or capital stock of Participant, or of the beneficial interests of such trust; in the event that Participant is a limited or general partnership, such transfer shall refer to the transfer of more than twenty-five percent (25t) of the limited or general partnership interests; in the event that Participant 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 trans- fers into account on a cumulative basis. Notwithstanding the foregoing, a Transfer shall not include (i) any mortgage or deed of trust for restructuring or refinancing the Bonds (as such term is hereinafter defined) provided that the amount of the indebtedness incurred in the restructuring or refinancing does not exceed the outstanding balance of the Bonds; (ii) a mortgage or deed of trust subordinated to this Regulatory Agreement for the benefit of the Federal Home Loan Bank Board in an amount not to exceed FOUR HUNDRED THIRTY-FIVE THOUSAND DOLLARS ($435, 000 .00) ; or (iii) a Page 12 of 22 FSM%31014094-W12\2037441.5 09/27M • • �� sale, transfer, assignment or disposition of an interest in the Participant or the Site to a partnership in which Corporate Fund for Housing or a corporation controlled by Corporate Fund for Housing is the managing general partner. 6.2 Limitation on Transfers . Prior to the termination of this Regulatory Agreement and the reconveyance of the Deed of Trust, Participant shall not Transfer the HRA, or this Regulatory Agreement, or any interest in the Site or in the improvements thereon, directly or indirectly, voluntarily or by operation of law, without the prior written approval of Agency, which approval shall not be unreasonably withheld. Any such purported Transfer without such approval shall be null and void. In considering whether it will grant approval to any Transfer by Participant, Agency shall consider factors such as (i) whether the completion of the Project is jeopardized; (ii) the financial strength and capability of the proposed transferee to perform Participant' s obligations hereunder; and (iii) the proposed transferee' s experience and expertise in the planning, financing, development, ownership, and operation of similar projects. It shall be deemed reasonable for the Agency to refuse to consent to a Transfer based on any of the above referenced reasons. In the absence of specific written agreement by Agency, no Transfer by Participant of all or any portion of its interest in the Site or this Agreement shall be deemed to relieve Participant or any successor party from any obligations under this Agreement. In addition, no attempted Transfer of any of Participant'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. 7. ENFORCEMENT. 7. 1 Events of Default. In the event Developer defaults in the performance or observance of any covenant, . agreement or obligation of Developer set forth in this Regulatory Agreement, and if such default remains uncured for a period of thirty (30) days after written notice thereof if such event is a monetary default or thirty (30) days after written notice thereof if such event is a non-monetary default; provided, however, that in the event said non-monetary default cannot be cured within said time period, Developer has failed to commence to cure such default within ten (10) days after receiving said notice or thereafter fails to diligently prosecute said cure to completion, then Agency shall declare an "Event of Default" to have occurred hereunder, and, at its option, may take one or more of the following steps: 7 .1. 1 By mandamus or other suit, action or proceeding at law or in equity, require the Owner to perform its Page 13 of 22 MU13\0110140012\2037411.5 09/77/93 �VrG..�ail Ji obligations and covenants hereunder or enjoin any acts or things which may be unlawful or in violation of this Regulatory Agreement; or 7. 1.2 Take such other action at law or in equity as may appear necessary or desirable to enforce the obligations, covenants and agreements of the Owner hereunder. 7 .2 Rights are Cumulative. Except as otherwise expressly stated in this Regulatory Agreement, the rights and remedies of the parties are cumulative, and the exercise by any party of one or more of its rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by another party. 7 . 3 Developer Non-Profit . Agency acknowledges that it has received financial statements of Developer from Developer, and that Developer is a nonprofit public benefit corporation without members and without assured sources of funding or capital . Notwithstanding any provision or obligation to the contrary contained in this Regulatory Agreement, (a) the liability of Developer under this Regulatory Agreement to Agency and its successors and assigns, is limited to Developer' s interest in the Project and the Site and Agency shall look exclusively thereto, or to such other security as may from time to time be given for the payment of obligations arising out of this Regulatory Agreement; and (b) from and after the date of this Regulatory Agreement, no deficiency or other personal judgment, nor any order or decree of specific performance (other than pertaining to the Regulatory Agreement, any agreement pertaining to the Site or the Project or any other agreement securing Developer' s obligations under this Regulatory Agreement) , shall be rendered against: (i) Developer; (ii) the assets of Developer, (other than Developer' s interest in the Project or the Site and the rents, issues and profits thereof, any agreement pertaining to the Site or any other agreement securing Developer's obligations under this Regulatory Agreement) ; or (iii) its officers, directors, agents or members or their heirs, personal representatives, successors, transferees or assigns, as the case may be, in any action or proceeding arising out of this Regulatory Agreement, or any agreement securing the obligations of Developer under this Regulatory Agreement, or any judgment, order or decree rendered pursuant to any such action or proceeding. Notwithstanding the foregoing, Developer shall have personal liability for one hundred percent (100W) of the costs or damages arising from any of the following: (i) fraud or intentional material misrepresentation which induce Agency to enter into the transaction evidenced by the HRA and the documents referred to therein, including the Note, the Deed of Trust and this Regulatory Agreement; (ii) commission of waste; (iii) causing cancellation of any of the insurance required pursuant to the Deed of Trust; (iv) intentional failure to observe and comply with all applicable laws , ordinances, regulations; and (v) the intentional misapplication of Page 14 of 22 P521393\014084-0012\20374413 091VI93 (a) proceeds paid, prior to any foreclosure of the Site, under any insurance policy by reason of damage, loss, or destruction to any portion of the Site (to the full extent of such proceeds) ; (b) any proceeds or awards resulting from the condemnation, prior to any foreclosure, of all or any part of the Site (to the full extent of such proceeds or awards) ; and/or (c) gross receipts from rental of the Site received or applicable to a period prior to any foreclosure of the Site after notice of default, which gross receipts are deemed to be the property of Agency, including without limitation, the collection and retention of any such gross receipts after any notice of default or foreclosure or exercise of other remedies by Agency (following any applicable cure periods) has been given to Developer. B . NONDISCRIMINATION. 8 . 1 In General . There shall be no discrimination against or segregation of any person, or group of persons, on account of race, color, creed, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Site, or any part thereof, nor shall Developer, or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the Site, or any part thereof. 8 .2 Clauses in Agreements . Developer shall not restrict the rental, sale or lease of any portion of the Site on the basis of race, color, creed, religion, sex, marital status, ancestry or national origin of any person. Any and all agreements relating to the rental, sale or lease of the Site, or any portion thereof, shall contain the following nondiscrimination or nonsegregation clauses (or clauses substantially similar thereto) : 8 .2 .1 Clause for Deeds. The following language shall appear 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 persons on account of race, color, creed, religion, sex, marital status, ancestry or national origin in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the grantee himself or herself, or any persons claiming under or through him or her, establish or permit any such practice or prac- Page 15 of 22 P521383\0140944001212037441.5 09/27/93 tices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the land herein con- veyed. The foregoing covenants shall run with the land. " 8 .2 .2 Clause for Leases . The following language shall appear 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 on account of race, color, creed, religion, sex, marital status, ancestry or national origin in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the land 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 with reference to the selection, location, number, use or occupancy of tenants, lessees, sublessees, subtenants, or vendees in the land herein leased. " 8 .2 .3 Clause for Contracts. The following language shall appear in contracts: "There shall be no discrimination against or segregation of any persons or group of persons on account of race, color, creed, religion, sex, marital status, ancestry or national origin in the sale, lease, transfer, use, occupancy, tenure or enjoyment of land, 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 with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of land. " Page 16 of 22 PS2\363\0140Uf WIR2037M1.5 09/27193 9 . COVENANTS TO RUN WITH THE LAND. 9 . 1 Covenants Running With The Land. Developer hereby subjects the Site to the covenants, reservations and restrictions set forth in this Regulatory Agreement. The Agency and the Developer hereby declare their express intent that all such covenants, reservations and restrictions shall be deemed covenants running with the land and shall pass to and be binding upon the Developer' s successors in title to the Site; provided, however, that on the termination of this Regulatory Agreement said covenants, reservations and restrictions shall expire, except those covenants contained in Section 8 . 0, which shall be binding in perpetuity. All covenants without regard to technical classification or designation shall be binding for the benefit of the Agency, and such covenants shall run in favor of the Agency for the entire term of this Regulatory Agreement , without regard to whether the Agency is or remains an owner of any land or interest therein to which such covenants relate. Each and every contract, deed or other instrument hereafter executed covering or conveying the Site or any portion thereof shall conclusively be held to have been executed, delivered and accepted subject to such covenants, reservations and restrictions, regardless of whether such covenants, reservations and restrictions are set forth in such contract, deed or other instrument. 9 .2 Touch and Concern the Land. Agency and Developer hereby declare their understanding and intent that the burden of the covenants set forth herein touch and concern the land in that Developer' s legal interest in the Site is rendered less valuable thereby. Agency and Developer hereby further declare their understanding and intent that the benefit of such covenants touch and concern the land by enhancing and increasing the enjoyment and use of the Project by Very Low Income Tenants and Low Income Tenants , the intended beneficiaries of such covenants, reservations and restrictions, and by furthering the public purposes for which the Agency was formed. 9 . 3 Agreement Between Owner and Agencv. The Declarant, in exchange for the Agency entering into the HRA, hereby agrees to hold, sell and convey the Site subject to the terms of this Regulatory Agreement. Declarant also grants to the Agency and the City the right and power to enforce the terms of this Regulatory Agreement against the Declarant and all persons having any right, title or interest in the Site or any part thereof, their heirs, successive owners and assigns. 10 . TERM. This Regulatory Agreement, except for the provisions contained in Section 8 . 0, shall automatically terminate without any further action of the parties upon the termination of the Qualified Page 17 of 22 PS213131014094-001212037441.5 091VI93 Project Period. The provisions of Section 8 . 0 of this Regulatory Agreement shall remain in full force and effect in perpetuity. 11 . ATTORNEYS' FEES . In the event that a party to this Regulatory Agreement brings an action against the other party hereto by reason of the breach of any condition or covenant, representation or warranty in this Regulatory Agreement, or otherwise arising out of this Regulatory Agreement, the prevailing party in such action shall be entitled to recover from the other reasonably attorney' s fees to be fixed by the court which shall render a judgment, as well as the costs of suits . Attorney' s fees shall include attorney' s fees on any appeal, and in addition a party entitled to attorney' s fees shall be entitled to all other reasonable costs for investigating such action, including the conducting of discovery. 12 . AMENDMENTS. This Regulatory 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. This Regulatory Agreement may not be amended during the HUD Section 232B.C. loan period without the prior written approval of HUD. 13 . 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: Agency: Redevelopment Agency of the City of Palm Springs, California 3200 E. Tahquitz McCallum Way P.O. Box 2743 Palm Springs, CA 92263-2743 Attn: Executive Director Copy to: Rutan & Tucker 611 Anton Blvd. , 13th Floor Costa Mesa, CA 92626 Attn: David J. Aleshire, Esq. Page 18 of 22 FS21393\014061-0012\2037441.3 09/27/93 Developer: Corporate Fund for Housing 100 Pacifica, Suite 470 Irvine, CA 92718 Attn: Barry Hamel Copy to: Dean V. Ambrose, Esq. 3200 Olympic Boulevard Santa Monica, CA 90404 The notice shall be deemed given three (3) business days after the date of mailing, or, if personally delivered, when received. 14 . SEVERABILITY/WAIVER/INTEGRATION. 14 . 1 If any provision of this Regulatory Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining portions hereof shall not in any way be affected or impaired thereby. 14 .2 A waiver by either party of the performance of any covenant or condition herein shall not invalidate this Agreement nor shall it be considered a waiver of any other covenants or conditions, nor shall the delay or forbearance by either party in exercising any remedy or right be considered a waiver of, or an estoppel against, the later exercise of such remedy or right. 14 . 3 This Agreement contains the entire Agreement between the parties and neither party relies on any warranty or representation not contained in this Agreement. 15 . FUTURE ENFORCEMENT. The parties hereby agree that should the Agency cease to exist as an entity at any time during the term of this Regulatory Agreement, the City of Palm Springs shall have the right to enforce all of the terms and conditions herein, unless the Agency had previously specified another entity to enforce this Regulatory Agreement. 16 . GOVERNING LAW. This Regulatory Agreement shall be governed by the laws of the State of California. Page 19 of 22 F3Z39310140U-0012U037441.5 09/27/93 382201 17. COUNTERPARTS . This Regulatory 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 . 18 . BOND REGULATORY AGREEMENT. Concurrently with the execution of this Regulatory Agreement, Developer, the Housing Authority of the City of Palm Springs, a housing authority of the State of California, duly organized and existing under the laws thereof, Seattle-First National Bank, a national banking association duly organized and existing under the laws of the United States of America, entered into that certain Regulatory Agreement and Declaration of Restrictive Covenants ( "Bond Regulatory Agreement") , which Bond Regulatory Agreement is to be recorded concurrently herewith in the Official Records of Riverside County, California. In the event of any inconsistency between the provisions of this Regulatory Agreement and the provisions of the Bond Regulatory Agreement, the more restrictive provision shall be controlling. IN WITNESS WHEREOF, the Agency and Developer have executed this Regulatory Agreement and Declaration of Covenants and Restrictions by duly authorized representatives on the date first written above. ATTEST: THE RED E-L$P GENCY OF THE CIT F PALM SPRIN CALIFORNIA, a pub is body, co r and politic s B Lc e� By: Secretary Executiv Director [Signatures continued on next page. ] APPROVED AS TO FORM: RUTAN & TUCKER, By:� `_` GCC�;]c David . Aleshire Agency Counsel . "Agency" Page 20 of 22 P52\3%3\0140M-0012\2037441.5 09127193 CORPORATE FUND FOR HOUSING, a Californi onprofit blic benefit corporati n B . Its : l By. Its: "Developer" Page 21 of 22 PS21383\014054-0012\2037441.2 STATE OF CALIFORNIA ) 99 . COUNTY OF el;4/1,'60 ) On /91-7 , before me, J y ✓G hi LFfZyci� personally appeared peranna�l k7rown tome (or proved to me on the basis of satisfac- tory evidence) to be the personke-)- whose name (s) is/-a-re subscribed to the within instrument and acknowledged to me that he%she-fthey- executed the same in his/her-/-7-h -r authorized capacity ( e'a) , and that by his/her-/-the- r--signatures - on the instrument the person(-s) or the entity upon behalf of which the person Fs} acted, executed the instrument. Witness my hand and official seal. SI1NE M,UIZICH COMM.i919i&10 No ry Public [SE } NOMY PJAC—Cd10MIG ORANGE COUNTY My Comm.Exp res MAV 12.1995 STATE OF CALIFORNIA ) COUNTY OF� r" On 9-- 1219s �1_51 byefore me, , 191711 personally appeared . personally known to me (-or p-r-owed-to-me-on__the_baa ,f eat s-f-a.e- -to-ry-evi ence) to be the person Ei whose name o is/are subscribbeedd to the within instrument and acknowledged to me that he/shejthey---� executed the name n- his/hexEei authorized capacity(�e�, and that by his/herr,ei>1 signature ( on the instrument the person6D or the entity upon behalf of which the person(io acted, executed the instrument . Witness my hand and official seal . ° Notary Publ3d '��'� OFFICIAL NOTARY SEAL (SEAL] d C� ELAINF L.SCHUVAN'fl S, Notary Rubhc—CahfuY miaRI1/ERSIP {µ > Ny Corn m Exp E COUNTires FES U3.1095 1) wg Page 22 of 22 FSZ393\01408"12\2037441.2 382201 EXHIBIT "1" DESCRIPTION OF PROPERTY That certain real property located in the County of Riverside, State of California, legally described as follows: LOT 15 IN SECTION 13 , TOWNSHIP 4 SOUTH, RANGE 4 EAST, SAN BERNARDINO MERIDIAN, AS PER MAP OF PALM VALLEY COLONY LANDS, RECORDED IN BOOK 14, PAGE 652 OF MAPS, SAN DIEGO COUNTY RECORDS; EXCEPT THAT PORTION LYING NORTH OF THE SOUTH LINE OF ENCHANTED HOMES UNIT NO. 1, RECORDED IN BOOK 34, PAGE 17 OF MAPS, RIVERSIDE COUNTY RECORDS. SAID PROPERTY IS SHOWN ON RECORD OF SURVEY ENTITLED "RECORD OF SURVEY OF A PORTION OF LOT 15 OF SECTION 13, TOWNSHIP 4 SOUTH, RANGE 4 EAST, SAN BERNARDINO MERIDIAN, AS SHOWN BY MAP OF PALM VALLEY COLONY LANDS AS RECORDED IN BOOK 14 , PAGE 652 OF MAPS, SAN DIEGO COUNTY RECORDS" ON FILE IN BOOK 33, PAGE 77 OF RECORDS OF SURVEY, RIVERSIDE COUNTY RECORDS. SAID LAND IS LOCATED IN THE CITY OF PALM SPRINGS. EXHIBIT 11111 PS1\ M14084-0012151195.1 07123193 99 27 95 17;14 e619 323 3314 PALM SPRINGS +++ RL�TAN LL�CKER 4J602 e !i $ _£• Q ' 4 • iY�ry T' � + Cy 4j + r IIII • a , � a � •d *� w s.r r YN x N - E •- tr SO w` r PROJECT SITE ~ 2990 Tahquitz Canyon way a� � F Fo « b Oa APN 502-143-004 0 .'Sit 0 r 7� � M V 0 +. EXHIBIT "2" TO REGULATORY AGREEMENT ! ! 32Q ,° EXHIBIT "3" INCOME COMPUTATION AND CERTIFICATION RE: (Address of Apartment Building] I/We, the undersigned state that I/we have read and answered fully, frankly and personally each of the following questions for all persons who are to occupy the unit being applied for in the above apartment project . Listed below are the names of all persons who intend to reside in the unit : 1 2 3 4 5 Name of Members Relationship of the to Head of Social Place of Household Household Age Security Employment Number HEAD SPOUSE Income Co=utation 6 . The total anticipated income, calculated in accordance with the provisions of this paragraph 6, of all persons over the age of 18 years listed above for the 12-month period beginning the date that I/we plan to move into a unit is Included in the total anticipated income listed above are: (a) all wages and salaries, overtime pay, commissions, fees, tips and bonuses and other compensation for personal services before payroll deductions; (b) the net income from the operation of a business or profession or from the rental of real or personal property (without deducting expenditures for business expansion or amortization of capital indebtedness) ; (c) interest and dividends including income from assets excluded below; EXHIBIT "3 " TO REGULATORY AGREEMENT F52\.393\0140U-0012\2037441.2 • • 382/0JF j (d) the full amount of periodic payments received from social security, annuities, insurance policies, retirement funds, pensions, disability or death benefits and other similar types of periodic receipts, including any lump sum payment for the delayed start of a periodic payment; (e) payments in lieu of earnings, such as unemployment and disability compensation, workmen' s compensation and severance pay; (f) the maximum amount of public assistance available to the above persons other than the amount of any assistance specifically designated for shelter and utilities; (g) periodic and determinable allowances, such as alimony and child support payments and regular contributions and gifts received from persons not residing in the dwelling; (h) all regular pay, special pay and allowances of a member of the Armed Forces (whether or not living in the dwelling) who is the head of the household or spouse; and (i) any earned income credit to the extent that it exceeds income tax liability. Excluded from such anticipated income are: (a) casual, sporadic or irregular gifts; (b) amounts which are specifically for or in reimbursement of medical expenses; (c) lump sum additions to family assets, such as inheritances, insurance payments (including payments under health and accident insurance and workmen' s compensation) , capital gains and settlement for personal or property losses; (d) amounts of educational scholarships paid directly to the student or the educational institution, and amounts paid by the government to a veteran for use in meeting the costs of tuition, fees, books and equipment. Any amounts of such scholarships or payments to veterans not used for the above purposes are to be included in income; (e) special pay to a household member in the Armed Forces who is away from home and exposed to hostile fire; (f) relocation payments made pursuant to federal, state or local relocation law; 2- P82\ M0140M-0012\2037441.2 382 (g) foster child care payments; (h) the value of coupon allotments for the purchase of food pursuant to the Food Stamp Act of 1977; (i) payments to volunteers under the Domestic Volunteer Service Act of 1973 ; (j ) payments received under the Alaska Native Claims Settlement Act; (k) income derived from certain submarginal land of the United States that is held in trust for certain Indian tribes; (1) payments or allowances made under the Department of Health and Human Services' Low-Income Home Energy Assistance Program; (m) payments received from the Job Training Partnership Act; (n) income derived from the disposition of funds of the Grand River Band of Ottawa Indians; and (0) the first $2 , 000 . 00 of per capita shares received from judgment funds awarded by the Indian Claims Commission or the Court of Claims . 7. Do the persons whose income or contributions are included in item 6 above: (a) have savings, stocks, bonds, equity in real property or other form of capital investment (excluding the values of necessary items of personal property such as furniture and automobiles and interests in Indian trust land) Yes No; or (b) Have they disposed of any assets (other than at a foreclosure or bankruptcy sale) during the last two years at less than fair market value? Yes No (c) If the answer to (a) or (b) above is yes, does the combined total value of all such assets owned or disposed of by all such persons total more than $5, 000? Yes No (d) If the answer to (c) above is yes, state: (1) the amount of income expected to be derived from such assets in the 12-month period beginning on the -3- P52\383\0110l40012\2037411.2 date of initial occupancy in the unit that you propose to rent $ ; and (2) the amount of such income, if any, that was included in item 6 above $ 8 . (a) Are all of the individuals who propose to reside in the unit full-time students? Yes No A full-time student is an individual enrolled as a full- time student during each of 5 calendar months during the calendar year in which occupancy of the unit begins at an educational organization which normally maintains a regular faculty and curriculum and normally has a regularly enrolled body of students in attendance and is not an individual pursuing a full-time course of institutional on farm training under the supervision of an accredited agent of such an educational organization or of a state or political subdivision thereof. (b) If the answer to 8 (a) is yes, is at least 1 of the proposed occupants of the unit a husband or wife entitled to file a joint federal income tax return? Yes No 9 . Neither myself nor any other occupant of the unit I/we propose to rent is the owner of the rental housing project in which the unit is located (hereinafter the "Owner") , has any family relationship to the Owner, or owns directly or indirectly any interest in the Owner. For purposes of this paragraph, indirect ownership by an individual shall mean ownership by a family member, ownership by a corporation, partnership, estate or trust in proportion to the ownership or beneficial interest in such corporation, partnership, estate or trustee held by the individual or a family member; and ownership, direct or indirect, by a partner of the individual . 10 . This certificate is made with the knowledge that it will be relied upon by the Owner to determine maximum income for eligibility to occupy the unit; and I/we declare that all information set forth herein is true, correct and complete and based upon information I/we deem reliable and that the statement of total anticipated income contained in paragraph 6 is reasonable and based upon such investigation as the undersigned deemed necessary. 11. I/we will assist the Owner in obtaining any information or documents required to verify the statements made herein, including either an income verification from my/our present employer (s) or copies of federal tax returns for the immediately preceding calendar year. -4- PS2\3!3\01408"12\2037441.2 12 . I/we acknowledge that I/we have been advised that the making of any misrepresentation or misstatement in this declaration will constitute a material breach of my/our agreement with the Owner to lease the unit and will entitle the Owner to prevent or terminate my/our occupancy of the unit by institution of an action for ejection or other appropriate proceedings . I/we declare under penalty of perjury that the foregoing is true and correct . Executed this day of in the County of California. Applicant Applicant [All persons listed in number 2 above over the age of 18 years must sign this form] -5- P52\393\0140M-0012\2037441.2 FOR COMPLETION BY APARTMENT OWNER ONLY: Y 1 . Calculation of eligible income: a. Enter amount entered for entire household in 6 above: $ b. (1) If the answer to 7 (c) above is yes, enter the total amount entered in 7 (d) (1) , subtract from that figure the amount entered in 7 (d) (2) and enter the remaining balance (2) Multiply the amount entered in 7 (c) times the current passbook savings rate as determined by HUD to determine what the total annual earnings on the amount in 7 (c) would be if invested in passbook savings ($ ) , subtract from that figure the amount entered in 7 (d) (2) and enter the remaining balance (3) Enter at right the greater of the amount calculated under (1) or (2) above: $ C. TOTAL ELIGIBLE INCOME (Line l .a plus line l.b (3) ) : $ 2 . The amount entered in l.c: Qualifies the applicant (s) as a Very Low Income Tenant (s) . Qualifies the applicants) as a Low Income Tenant (s) . Does not qualify the applicant (s) as Very Low Income or Low Income Tenant (s) . 3 . Number of apartment unit assigned: Bedroom Size Rent $ 4 . This apartment unit [was/was not] last occupied for a period of more than 31 consecutive days by persons whose aggregate anticipated annual income as certified in the above manner upon their initial occupancy of the apartment unit qualified them as [Very Low Income Tenants/Low Income Tenants] . -6- F52\363\0140bF0012\2037M1.2 • tiY�Zw V 1 5 . Methods used to verify applicant (s) income: Employer income verification Copies of tax returns Other ( ) Manager -7- PS2\33%3\O110b/-0012\2037411.2 A 20 INCOME VERIFICATION (for employed persons) The undersigned employee has applied for a rental unit located in a project financed under the Community Redevelopment Agency of the City of Palm Springs Low Income Housing Set-Aside Fund for persons of very low or low income. Every income statement of a prospective tenant must be stringently verified. Please indicate below the employee' s current annual income from wages, overtime, bonuses, commissions or any other form of compensation received on a regular basis . Annual wages Overtime Bonuses Commissions Total current income I hereby certify that the statements above are true and complete to the best of my knowledge. Signature Date Title I hereby grant you permission to disclose my income to in order that they may determine my income eligibility for rental of an apartment located in their project which has been financed under the Community Redevelopment Agency of the City of Palm Springs Low Income Housing Set-Aside Fund. Signature Date Please send to: -8- FSM93L0140U-0012U034441.2 ` IV8F 201 INCOME VERIFICATION (for self-employed persons) I hereby attach copies of my individual federal and state income tax returns for the immediately preceding calendar year and certify that the information shown in such income tax returns is true and complete to the best of my knowledge. Signature Date -9- F52\383\014084-0012\2037441.2 203 EXHIBIT "4" Period Covered Quarterly CERTIFICATE OF CONTINUING PROGRAM COMPLIANCE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS . CALIFORNIA (TAHOUITZ COURT APARTMENTS) The undersigned, CORPORATE FUND FOR HOUSING, a California nonprofit public benefit corporation (the "Developer") , has read and is thoroughly familiar with the provisions of the Housing Rehabilitation Agreement ( "HRA°) and documents referred to therein executed by Developer and The Community Redevelopment Agency of the City of Palm Springs, California ("Agency" ) including the Regulatory Agreement; the Note; and the Deed of Trust, as such terms are defined in the HRA. As of the date of this Certificate, the following percentages of completed residential units in the Development (i) are occupied by Very Low Income Tenants and Low Income Tenants (as such terms are defined in the Regulatory Agreement) or (ii) are currently vacant and being held available for such occupancy and have been so held continuously since the date a Very Low Income Tenant or Low Income Tenant vacated such unit; as indicated: Number of Units occupied by Very Low Income Tenants : Number of Units Occupied by Low Income Tenants : Vacant Units: Very Low Income Tenants and Low Income Tenants who commenced occupancy of Units during the preceding quarter: Very Low Income Tenants Low Income Tenants Percent Percent Unit Nos . Unit Nos. Percent Percent Unit Nos. Unit Nos . Percent Percent Unit Nos. Unit Nos . Attached is a separate sheet (the "Occupancy Summary") listing, among other items, the following information for each EXHIBIT "4" TO REGULATORY AGREEMENT P 52\3 63\0140"-W 12\2037441.2 Unit : the number of each Unit, the occupants of each Unit, the rental paid for each Unit, the size and number of bedrooms of each Unit, which Units are Very Low Income Units and Low Income Units and which Units became Very Low Income Units and Low Income Units during the preceding quarter. The information contained on the Occupancy Summary is true and accurate. The undersigned hereby certifies that (1) a review of the activities of the Developer during such quarter and of the Developer' s performance under the HRA and the documents referred to therein has been made under the supervision of the undersigned, and (2) to the best knowledge of the undersigned, based on the review described in clause (1) hereof, the Developer is not in default under any of the terms and provisions of the above documents [or describe the nature of any detail and set forth the measures being taken to remedy such defaults] . The undersigned hereby certifies that the Developer is not in default under any of the terms and provisions of the above documents . CORPORATE FUND FOR HOUSING, a California nonprofit public benefit corporation By: Its: By: Its: -2- FS2\383\014064-0012\2031441.2 • CORPORATE FUND FOR HSG - Hsg Rehab - Tahquitz Court AGREEMENT N317C HOUSING REHABILITATION AGREEMEN R894, 8-4-93 (see green bond issue Ntebk Vault._.Chalf_ full rnnv Car S71 HOUSING REHABILITATION AGREEMENT By and Between THE COM UNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA and CORPORATE FUND FOR HOUSING, a California nonprofit public benefit corporation • TABLE OF CONTENTS I SECTION 1 . DEFINITIONS . . . . . . . . . . . . . . . 1 . 1 Agency . . . . . . . . . . . . . . . . . . . . . 1 .2 Agreement . . . . . . . . . . . . . . . . . . 1 1.3 Bond Financing . . . . . . . . . . . 1 . . 2 2 1.4 Certificate of Completion . . . . 1.5 CEQA . . . . . . . . . . . . . . . . . . . . . . . 2 1. 6 City . . . . . . . . . . . . . . . . 2 2 1 . 7 Corporate Resolution . . . . . . . . 2 1. 8 Days . . . . . . . . . . . . . . . . . . .. . . 2 1 .9 Deed of Trust . . . . . . . . . . . . 2 1. 10 Effective Date . . . . . . . . . . . . 2 1. 11 Executive Director . . . . . . . . . . . 2 1. 12 Financing Statement . . . . . . . . . . . . 3 1 . 13 Force Maj eure . . . . . . . . . . . . . . 3 1. 14 Note . . . . . . . . . . . . . . . . . . . . 3 1. 15 Participant . . . . . . . . . . . . . . 3 1 . 16 Project . . . , , , , 3 1. 17 Regulatory Agreement . . . . . . . . . 3 1 .18 Schedule of Performance . . . . . . . . . 3 1. 19 Scope of Development . . . . . . . . . . . . 3 1.20 Site . . . . . . . . . . . . . . . . . . . . . . . 3 1.21 Site Map . . . . . . . . . . . . . . . . . . . . . 4 SECTION 2 , PURPOSE OF THIS AGREEMENT 4 SECTION 3 . REPRESENTATIONS AND WARRANTIES . . . 4 3 .1 Participant Representations and Warranties 4 3 . 1. 1 Participant Ownership of the Site . . 4 3 . 1.2 Litigation . . . . . . . . . . . 5 3 .1 .3 No Default . . . . . . . . . . . . . . . 5 3 . 1.4 No Violation . . . . . . . . . . 5 3 . 1 .5 No Possessory Interests . . . . . . . . . 5 3 . 1. 6 No Bankruptcy . . . . . . . . . . . . . . 5 3 . 1.7 No Misrepresentation . . . . . . . . 5 3 . 1 . 8 Disclosure . . . . . . . . . . . . 5 3 .1.9 Due Execution . . . . . 6 3 . 1. 10 No Extraneous Consideration . . . . 6 3 . 1. 11 Financial Information . . . . . . • . 6 3 . 1. 12 Taxes . . . . . . . . . . . . . 6 3 .1.13 Foreign Entity . . . . . . _ 6 3 .2 Agency Representations and Warranties . . . 6 3 .2 .1 No Approvals . . . . . . . . . . 6 3 .2 .2 Due Execution . . . . . . . 6 3 .2 .3 Governmental Approvals . . . . . . . . . 7 SECTION 4. DEVELOPMENT OF THE SITE . . . . . 7 4 . 1 Construction of the Project . . . . . . . . . 7 4 . 1. 1 Development in Accordance with Plans 7 4 .1.2 . . . . . . . . . . . . . . . . . . . . 7 P52\39=14084-0012\2035994.3 07/28/93 _i_ 4 . 1. 3 Other Governmental Permits . . . . . . . 7 4 .1 .4 Approval by Agency . . . . . . . 8 4 . 1.5 Cost of Acquisition and Rehabilitation 8 4 . 1 . 6 Acquisition and Rehabilitation Schedule; Reports . . . . . . . . . . . . . . . . . 8 4 .2 Grant of Funds . . . . . . . . . . . . . . . 8 4 .2 . 1 Assistance to be Provided . . . . . . . . 8 4 .2 .2 Conditions Precedent to Disbursement . . 8 4 .2 . 3 Disbursed Funds . . . . . . . . . . . 9 4 .2 .4 Note, Deed of Trust, Financing Statement and Corporate Resolution . . . . . . . . 9 4 .2 . 5 Title Insurance . . . . . . . . . . . . . 10 4.2 .6 Forgiveness of Note . . . . . . . . . . . 10 4 .3 Financial Capability . . . . . . . . . . . . . . . 10 4 .3 .1 Definition . . . . . . . . . . . . . . . 10 4 . 3 .2 Submission to Agency . . . . . 11 4.3 . 3 Approval of Evidence of Financial Capability . . . . . 11 4 .4 Liability; Worker' s Compensation; Automobile and Builder' s Risk Insurance . . . . . . . . . . . . . 11 4 .5 Rights of Access . . . . . . . . . . . . . . . . . 12 4 . 6 Applicable Laws . . . . . . . . . . . . . . . . . . 13 4 .7 Antidiscrimination During Construction . . . . . . 13 4 . 8 Relocation Assistance . . . . . . . . . . . . . . . 13 4 .9 Indemnification . . . . . . . . . . . . . . . . . . 13 4 .10 Hazardous Substances . . . . . . . . . . . . . . . 14 4 . 11 Certificate of Completion . . . . . . . . . . . . . 17 SECTION 5 . USE OF THE SITE . . . . . . . . . . . . . . . 18 _ 5 . 1 No Inconsistent Uses . . . . . . . . . . . . . . . 18 5 .2 Regulatory Agreement . . . . . . . . . . . . . . . 18 5 .3 Participant Covenants . . . . . . . . . . . . . . . 18 SECTION 6 . DEFAULTS AND REMEDIES . . . . . . . . . . . . 19 6. 1 Participant Defaults . . . . . . . . . . . . . . . 19 6 .2 Agency Defaults . . . . . . . . . . . . . . . . . . 20 6 .3 Notice of Default . . . . . . . . . . . . . . . . . 20 6 .4 Remedies . . . . . . . . . . . . . . . . . . . 21 6 .3 Agency' s Right to Terminate . . . . . . . . . . . . 21 6. 6 Rights and Remedies are Cumulative . . . . . . . . 21 6 . 7 Participant Non-Profit . . . . . . . . . . . . . . 21 SECTION 7. GENERAL PROVISIONS . . . . . . . . . . . . . . 22 7. 1 Standards of Review . . . . . . . . . . . . . . . . 22 7.2 Governing Law . . . . . . . . . . . . . . . . . . . 23 7.3 Attorney' s Fees . . . 7 .4 Notices, Demands, and Communications Between the Parties . . . . . . . . . . . . . . . . . . . 23 7.5 Acceptance of Service of Process . . . . . . . . . 23 7 .6 Conflicts of Interest . . . . . . . . . . . . . 24 7.7 Nonliability of Agency Officials and Employees . . 24 7. 8 Books and Records . . . . . . . . . . . . . . . . . 24 FS2\3931014094-0012\2035994.3 07/2S/93 7 . 8 . 1 Maintenance of Books and Records 24 7. 8 .2 Right to Inspect _ . . . . 24 7 . 9 Ownership of Documents . . . . . . 7 . 10 Intentionally Deleted. . . . . • • • 24 7. 11 Titles and Captions . . . . . 25 7 . 12 Gender . . . . ' ' ' ' ' ' 25 7. 13 Modifications . . . . ' ' 25 25 7 . 14 Merger of Prior Agreements and Understandings 25 7. 15 No Third Parties Benefited . . . . . . 25 7. 16 Assurances to Act in Good Faith . . . . 25 7. 17 Interpretation . . . . ' 25 7. 18 Time For Acceptance of Agreement By Agency . . . . 25 7. 19 Counterparts . . . . . . . . . . . . 26 7.20 Severability . . . . . . . . . . . . . . . . . . . 26 Exhibit "A" - Legal Description of Site Exhibit "B" - Site Map Exhibit "C" - Scope of Development Exhibit "D" - Schedule of Performance Exhibit "E" - Certificate of Completion Exhibit "F" - Regulatory Agreement and Declaration of Covenants, Conditions and Restrictions Exhibit "G" - Promissory Note Secured by Deed of Trust Exhibit "H" - Deed of Trust with Assignment of Rents, Security Agreement and Fixture Filing Exhibit "I" - UCC-1 Financing Statement Exhibit "J" - Certified Copy of Corporate Resolution to Execute Agreement and Borrow Money Exhibit "K" Permitted Disbursements for Grant Exhibit "K-1" - Bond Issuance Costs Exhibit "L" - Disclosure of Hazardous Materials FS2U83X014084-001212035994.3 07/28/93 CORPORATE FUND FOR HSG - Hsg Rehab - Tahquitz Court AGREEMENT #317C R8948-4-93 HOUSING REHABILITATION AGREEMEN (see green" (see "green" bond issue Ntebk La.u1t._Sha1f fiill _r_nn'v_Sar__U) THIS HOUSING REHABILITATION AGREEMENT is entered into as of this �17h day of a�l_ � 1993 , by and between ITY REDEVELOPMENT AGENCY ' F THE CITYPALM S RINGS CALIFORNIA, a public agency, corporate and politic ( "Agency") , and CORPORATE FUND FOR HOUSING, a California nonprofit public benefit corporation ( "Par- ticipant") . R E C I T A L S A. Agency is a public body, corporate and politic, exercising governmental functions and powers and organized and existing under the Community Redevelopment Law of the State of California (Health and Safety Code Section 33000, et sea. ) . B. Agency desires to assist Participant in the acquisition of that certain real property designated herein as the "Site" (as such term is defined herein) and the rehabilitation of the improvements located thereon by granting participant certain funds from the Agency' s Affordable Housing Set-Aside Fund ( "Fund") , all as more particularly provided herein. C. In exchange for the granting of monies from the Fund, Participant has agreed to set aside forty percent (40%-) of the residential units located on the Site for rental to very low income households and sixty percent (60%-) of said units for rental to low income households, as more particularly provided herein. D. Although the Site is not located within a redevelopment project area of the Agency, the Agency and the "City" , as such term is hereinafter defined, have determined that the loaning of monies from the Fund for the acquisition and rehabilitation of the Site will be of benefit to the project areas of the Agency. NOW, THEREFORE, in consideration of the promises and covenants contained herein, the above recitals, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows : TERMS AND CONDITIONS SECTION 1. DEFINITIONS. The following terms, as used in this Agreement, shall have the meanings given unless expressly provided to the contrary: 1. 1 A enc . The term "Agency" shall mean THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA, a public body, corporate and politic, having its offices at 3200 East F82US3\014084-0012\2035994.3 07/29/93 Tahquitz Canyon Way, Palm Springs, California 92262, and any assignee of, or successor to, the rights, powers, and responsibilities of Agency. 1 .2 Agreement . The term "Agreement" or any reference to this "Agreement" shall mean this Housing Rehabilitation Agreement executed by and between Agency and Participant, including all exhibits attached hereto, which exhibits are incorporated herein by this reference and all other documents incorporated herein by reference. 1 . 3 Bond Financing. The term "Bond Financing" shall mean the tax exempt bond financing which will finance a portion of Participant' s cost to purchase the Site which was induced by the Housing Authority of the City of Palm Springs February 3 , 1993 as Resolution No. Z!p 1.4 Certificate of Completion. The term "Certificate of Completion" shall mean that Certificate attached hereto as Exhibit "E" issued by Agency to Participant pursuant to the provisions of Section 4 . 11 below. 1 .5 CEDA. The term "CEQA" shall mean the California Environmental Quality Act, Public Resources Code Section 21000 et sea. , as amended. — 1 . 6 City. The term "City" shall mean the CITY OF PALM SPRINGS, a municipal corporation, having its offices at 3200 East Tahquitz Canyon Way, Palm Springs, California 92263 . 1. 7 Corporate Resolution. The term "Corporate Resolution" shall mean that certain Certified Copy of Corporate Resolution to Execute Agreement and Borrow Money attached hereto as Exhibit "J" and incorporated herein by reference. 1. 8 Days. The term "days" shall mean calendar days and the statement of any time period herein shall be calendar days and not working days, unless otherwise specified. 1.9 Deed of Trust. The term "Deed of Trust" shall mean the Deed of Trust with Assignment of Rents and Fixture Filing attached hereto as Exhibit "H" and incorporated herein by reference. 1. 10 Effective Date. The term "Effective Date" shall mean the later of the date this Agreement is executed on behalf of Agency after a public hearing and approval by Agency and the date Participant acquires fee title to the Site. 1. 11 Executive Director. The term "Executive Director" shall mean the individual duly appointed to the position of Executive Director of the Agency. FS213E3\014094-0012\2035994.3 07/28/93 -2 1 . 12 Financing Statement. The term "Financing Statement" shall mean that certain UCC-1 Financing Statement attached hereto as Exhibit "I" and incorporated herein by reference. 1. 13 Force Majeure. The term "Force Majeure" shall mean any war, insurrection, strike, lock-out, labor dispute, riot, flood, earthquake, fire, casualty, Act of God, act of the public enemy, epidemic, quarantine restriction, freight embargo, unavoidable lack of transportation, governmental restriction, unusually severe weather, inability to secure necessary labor, materials or tools, delay of any contractor, subcontractor or supplier, act of the other party, act or failure to act of City or any other public or governmental agency or entity (except that any act or failure to act of City or Agency shall not excuse performance by Agency) , or any other cause beyond the control or without the fault of the party claiming an extension of time to perform. 1 .14 Note. The term "Note" shall mean that certain Promissory Note Secured by Deed of Trust attached hereto as Exhibit "G" and incorporated herein by reference. 1 . 15 Participant . The term "Participant" shall mean CORPORATE FUND FOR HOUSING, a California nonprofit public benefit corporation, whose address is 100 Pacifica, Suite 470, Irvine-, California 92718; provided that Participant shall have the right, prior to the Effective Date, to nominate as the Participant a partnership in which Corporate Fund for Housing is the managing Cgeneral partner. 1. 16 Project. The term "Project" shall mean the rehabilitation of the improvements located upon the Site as approved by the Agency and City pursuant to Section 4 .1.2 . 1. 17 Regulatory Agreement. The term "Regulatory Agreement" shall mean that certain Regulatory Agreement and Declaration of Covenants and Restrictions attached hereto as Exhibit "F" and incorporated herein by reference. 1. 18 Schedule of Performance. The term "Schedule of Performance" shall mean that certain schedule attached hereto as Exhibit "D" setting forth the times upon which performance by the parties under this Agreement is due. 1. 19 Scope of Development. The term "Scope of Development" shall mean that certain exhibit attached hereto as Exhibit "C" and incorporated herein by reference. 1.20 Site. The term "Site" shall mean that certain real property located in the City of Palm Springs, County of Riverside, State of California commonly known as 2890 East Tahquitz Canyon Way, Palm Springs, California and more particularly described on ( Exhibit "A" and depicted on the Site Map. FS21383%014094-001212035994.3 07/28/93 -3- 1.21 Site Map. The term "Site Map" shall mean the map attached hereto as Exhibit "B" and incorporated herein by reference depicting the location of the Site. SECTION 2 . PURPOSE OF THIS AGREEMENT. Pursuant to Section 33334 . 2 of the California Health and Safety Code this Agreement and the Exhibits attached hereto are intended to assist in guaranteeing the availability of residential rental units to very low and low income households by granting monies from the Affordable Housing Set-Aside Fund to assist in the acquisition and rehabilitation of properties located within the City. Participant has agreed to participate in the redevelopment of the Site by entering into this Agreement with Agency. The rehabilitation of the Site pursuant to this Agreement, and the fulfillment generally of this Agreement, are in the best interests of the City and the welfare of its residents, and are in accordance with the public purposes and provisions of applicable federal, state, and local laws and requirements under which the Project has been undertaken and is being assisted. This Agreement is entered into by the Agency pursuant to its authority under the Community Redevelopment Law of the State of California, Health and Safety Code Sections 33000 et sea. (all statutory references herein are to the Health and Safety Code unless otherwise provided) ; which authorizes the Agency to make agreements with owners, purchasers and lessees of property located within the City providing for the acquisition and rehabilitation of property and the provision of residential rental units to very low and low income households, and providing that the Agency retain controls and establish restrictions or covenants running with the land so that the property will be developed, operated, and used in conformity with this Agreement. This Agreement is also entered into by the Agency pursuant to Resolution 13345 of the City Council of the City of Palm Springs ratifying the passage of Proposition A by a majority of the qualified voters; which Proposition A authorized the City to assist the development of low and moderate income housing as required under Article 34 of the Constitution of the State of California. SECTION 3 . REPRESENTATIONS AND WARRANTIES . 3 . 1 Participant Representations and Warranties . Par- ticipant hereby makes the following representations, covenants, and warranties to the best of Participant's knowledge for the benefit of Agency, and Agency' s successors and assigns, and acknowledges that the execution of this Agreement by Agency has been made, in MATERIAL reliance by Agency on such representations and warranties : 3 . 1. 1 Participant Ownership of the Site. As of the Effective Date, Participant is owner of fee title to the Site. FS21383\014084-001212035994.3 07/23/93 -4- 3 . 1.2 Litigation. There are no material pending or threatened claims, actions, proceedings, or lawsuits of any kind, whether for personal injury, property damage, landlord-tenant disputes, property taxes, or otherwise, that could adversely affect title to or the operation or value of the Site or which questions the validity or enforceability of this transaction, nor is there any governmental investigation of any type or nature, pending or threatened, against or relating to the Site or the transactions contemplated hereby (other than those conducted by City and Agency) . 3 . 1.3 No Default. The execution and delivery of this Agreement and all other documents to be executed by Participant pursuant to this Agreement will not constitute or result in any default or event that with notice or the lapse of time, or both, would be a default, breach, or violation of any lease, mortgage, deed of trust, or other agreement, instrument or arrangement by which Participant or the Site are bound or any event which would permit any party to terminate an agreement or accelerate the maturity of any indebtedness or other obligation affecting Participant or the Site. 3 . 1 .4 No Violation. The execution and delivery of this Agreement and all other documents to be executed by Participant pursuant to this Agreement and the consummation of the transactions contemplated herein will not violate any provision of, or require any consent, authorization, or approval under any law or administrative regulation or any other order, award, judgment, writ, injunction or decree applicable to, or any governmental permit or license issued to, Participant or relating to the Site. 3 .1. 5 No Possessory Interests . Participant has or will have the right of possession to the Site free from any tenant leases, tenancies, licenses, or other similar occupancy agreements that could interfere with Participant' s right to rehabilitate the Project. 3 . 1. 6 No Bankruptcy. Neither Participant nor the entity constituting Participant, if any, has filed or been the subject of any filing of a petition under the Federal Bankruptcy Law or any insolvency laws, or any laws for the discharge of indebtedness or for the reorganization of debtors . 3 .1 . 7 No Misrepresentation. No representation, warranty, or covenant of Participant in this Agreement, or in any document or certificate furnished or to be furnished to Agency pursuant to this Agreement, contains or will contain any untrue statement of a material fact or omits or will omit to state a material fact necessary to make the statements contained herein or therein not misleading. . 3 . 1. 8 Disclosure. Participant has disclosed all information concerning the Site of which Participant is aware which FSZ393\014064-0012\2033994.3 07/28/93 -5- 0 may materially affect the value of the Site and/or Participant' s continued ability to rehabilitate and utilize the Site as provided in this Agreement . 3 . 1.9 Due Execution. This Agreement and all other documents to be executed by Participant pursuant to this Agreement have been or will be duly executed by Participant and constitute valid, binding, and enforceable obligations of Participant. Participant has complied with all laws and regulations concerning its organization, existence and transaction of business . 3 . 1.10 No Extraneous Consideration. Participant has not paid or given to, and will not pay or give to, the Agency or City or any official or agent of the Agency or City any money or other consideration for obtaining this Agreement, except as expressly provided herein. 3 . 1 . 11 Financial Information. All financial information delivered to Agency, including, without limitation, information relating to the financial condition of Participant, the Site, or the Project fairly and accurately represents such financial condition and has been prepared in accordance with generally accepted accounting principles consistently applied, unless otherwise noted in such information. No material adverse change in such financial condition has occurred. 3 . 1.12 Taxes . Participant has filed all required federal, state, county and municipal tax returns and has paid all taxes owed and payable pursuant to such returns or notice of assessment received by Participant, and Participant knows of no basis for additional assessment with respect to any taxes, other than due to Participant' s acquisition of the Site. 3 . 1.13 Foreign Entity. Participant is not a "foreign person" within the meaning of the Internal Revenue Code of 1986 (26 U.S .C. H 1445, 7701) or an out-of-state seller under California Revenue and Taxation Code Section 18805 . 3 .2 Agency Representations and Warranties. Agency hereby represents and warrants for the benefit of Participant and Participant' s successors and assigns, that the following facts are true as of the execution of this Agreement: 3 .2 . 1 No Approvals. No approvals or consents not heretofore obtained by Agency are necessary in connection with the execution of this Agreement by Agency or with the performance by Agency of Agency's obligations hereunder. 3 .2 .2 _ Due Execution. This Agreement has been duly executed by Agency or its duly authorized officers or agents and constitutes a valid, binding, and enforceable obligation of Agency. F52\383\014084-001212035994.3 07/28/93 -6- 3 .2 . 3 Governmental Approvals . Notwithstanding anything contained herein to the contrary, the Agency makes no representations or warranties with respect to the approvals required by any other governmental entity or with respect to approvals hereinafter required from the City or the Agency. The Agency reserves full police power authority over the Project and Participant acknowledges that the City retains such full police power as well . Nothing in this Agreement shall be deemed to be a prejudgment or commitment with respect to such items nor to guaranty that such approvals or permits will be issued within any particular time or with or without any particular conditions . SECTION 4 . DEVELOPMENT OF THE SITE. 4 . 1 Construction of the Project . 4 . 1. 1 Development in Accordance with Plans . Prior to the execution of this Agreement, Participant has received all permits and approvals from the City necessary to rehabilitate the Project in accordance with the Scope of Development . Participant has or shall rehabilitate the Project, in accordance with this Agreement, the Scope of Development, and the plans approved by and all permits and approvals obtained from City. Any changes to such plans and permits shall require the written consent of Agency and, if necessary, City. As completed, the Project (a) shall comply with all applicable laws and ordinances of all governmental authorities, including, without limitation, (i) all laws and ordinances necessary to permit development of the Site as permitted by this Agreement and (ii) the Americans With Disabilities Act, if applicable; (b) except as expressly provided herein, will be entirely on the Site and will not encroach upon the land of others or overabound any easement or right-of-way; and (c) will be wholly in compliance with any enforceable building restriction laws, however established, and will not violate any enforceable use, easement, license, covenant, condition or other restriction affecting the Site. 4.1.2 Intentionally deleted. 4 . 1.3 Other Governmental Permits. Participant shall have, at its own expense and before commencement of construction, rehabilitation, restoration, revitalization, or development of any buildings, structures, or other work of improvement upon the Site, secure or cause to be secured any and all permits and approvals which may be required by any governmental agency affected by such construction, development or work to be performed by Participant pursuant to the Scope of Development, including but not limited to, necessary building permits and all approvals required under CEQA. In rehabilitating the Project, Developer shall comply with all applicable development standards in City' s Municipal Code and shall comply with all building code, landscaping, signage and parking requirements except as may be PS2UM014084-001212035994.3 07/28/93 -7- permitted through approved variances and modifications and all requirements of the Americans with Disabilities Act, if applicable. Participant shall pay all normal and customary fees and charges applicable to such permits and any fees and charges hereafter imposed by City or Agency which are standard for and uniformly applied to similar projects in the City. 4 . 1.4 Approval by Acrencv. The Agency shall approve or disapprove any submittal made by the Participant pursuant to this Agreement within thirty (30) days after such submittal . All submittals made by Participant will note in bold type the thirty (30) day time limit and specifically reference this Agreement and this Section 4. 1.4 . Any disapproval shall state in writing the reason for the disapproval and the changes which the Agency requests to be made. After Participant resubmits the corrected submittal, Agency shall have an additional thirty (30) days for the review of the resubmittal but if the Agency disapproves the resubmittal, then the cycle shall repeat, until the Agency' s approval has been obtained. 4 . 1.5 Cost of Acquisition and Rehabilitation. Participant shall bear all costs of acquiring the Site and rehabilitating the Project, including, but not limited to any and all costs for demolition and clearance of existing surface and subsurface improvements inconsistent with the Project, architectural and engineering plans, preparation of the Site, costs associated with meeting applicable seismic standards, interim and permanent financing, broker's and leasing commissions, and fees or charges for development and building, except as specifically provided herein. 4.1. 6 Accruisition and Rehabilitation Schedule: Reports . Participant shall acquire the Site within the time set forth in the Schedule of Performance. At the time Participant shall have acquired the Site, all of the rehabilitation work to be performed hereunder shall have been completed. 4 .2 Grant of Funds . 4 .2 . 1 Assistance to be Provided. Subject to the terms and conditions set forth in this Section 4.2, Agency hereby agrees to grant Participant the sum of Five Hundred Ninety Thousand Dollars ($590, 000 .00) from the Fund for a portion of the cost of acquiring the Site and rehabilitating the Project as provided in this Agreement ("Grant") . The Grant proceeds shall only be used to pay those costs specifically listed on Exhibit "K" attached hereto and incorporated herein by reference. In the event the Grant is not sufficient to pay all of the items listed in Exhibit "K" , Participant shall be responsible for all additional costs. 4.2 .2 Conditions Precedent to Disbursement. Agency shall not be obligated to disburse the Grant proceeds, unless all \ F52\383\014094-0012\2035994.3 07/28/93 -8 of the following conditions precedent are satisfied at the time of ' such disbursement : (a) There exists (i) no Event of Default under this Agreement, the Deed of Trust or the Regulatory Agreement; (ii) no material default under the Note or any other document referred to herein; and (iii) no event, omission or failure of condition has occurred which would constitute an Event of Default hereunder or under the Deed of Trust or the Regulatory Agreement or a material default under the Note or any other document referred to herein after notice, the lapse of time or both; (b) Borrower has executed, acknowledged, if necessary, and delivered to Agency this Agreement, the Regulatory Agreement, the Note, the Deed of Trust, the Financing Statement, the Corporate Resolution and such other documents, instruments, policies, evidence and other materials to be delivered to Agency hereunder; (c) The Regulatory Agreement, the Certificate of Completion and the Deed of Trust shall have been recorded in the Office of the Riverside County Recorder; (d) A valid notice of completion for the Project has been recorded as provided in the California Civil Code and all applicable lien periods have expired; C (e) Participant has delivered to Agency a written invoice for the amounts expended by Participant to be reimbursed by Agency from the Grant proceeds, together with such supporting documentation as may be reasonably requested by Agency, including, but not limited to, conditional and unconditional releases for the work from all contractors, subcontractors and material suppliers; (f) The policy of title insurance referred to in paragraph 4 .2 . 5 has been issued; and (g) Agency shall have approved Participant's Evidence of Financial Capability, as hereinafter defined. 4.2 .3 Disbursed Funds . The Grant shall be disbursed to Participant on the Effective Date; provided that all of the conditions precedent specified in Section 4 .2 .2 have been satisfied. All disbursements shall be held by Participant in trust and applied by Participant solely for the purposes for which the funds have been disbursed. Agency shall not be obligated to monitor or determine Participant' s use or application of the Grant. 4 .2 .4 Note. Deed of Trust. Financing Statement and Corporate Resolution. Concurrently with the execution of this ( Agreement, Participant shall execute and acknowledge (if FS2\383\0140U-0012\2035994.3 07/29/93 -g appropriate) the Note, the Deed of Trust, the Financing Statement (` and the Corporate Resolution. The Agency hereby agrees to subordinate the Deed of Trust and the Financing Statement to the lien of the Bond Financing. 4 .2 .5 Title Insurance. Participant shall procure from a title insurer acceptable to Agency and deliver to Agency a 1990 ALTA lender' s extended coverage policy of title insurance ( "Title Policy') with such endorsements as Agency may require, insuring Lender in the principal amount of the Loan of the validity and priority of the Deed of Trust upon the Site, subject only to matters approved by Agency in writing. 4 .2 . 6 Forgiveness of Note. The parties hereto acknowledge that the funds to be provided to Participant under this Section 4 .2 are intended to be a grant of funds rather than a loan. However, in the event Participant defaults under any of its obligations hereunder, including the obligations in the Regulatory Agreement, Participant shall be obligated to repay all or a portion of the Grant as more particularly provided in the Note, the Deed of Trust and Financing Statement which are being executed by Participant to secure Participant' s obligation to repay the Grant in the event of such a default . If no such default occurs, said funds shall be fully forgiven thirty (30) years after the Certificate of Completion is recorded. 4 .3 Financial Capability. 4 .3 . 1 Definition. The term "Evidence of Financial Capability" shall mean the following documents, together with any other documents reasonably requested by the Executive Director of the Agency ( "Executive Director") : 4 . 3 . 1. 1 A copy of the commitment or commitments obtained by Participant for the bond (s) and/or mortgage loan (s) to assist in financing the acquisition of the Site and rehabilitation of the Project, certified by Participant to be a true and correct copy or copies thereof by a financial institution licensed to do business in California and acceptable to the Agency ( "Lender") . Each commitment for financing shall be in such form and content acceptable to the Executive Director as reasonably evidences a firm and enforceable commitment, with only those usual and customary commercial terms and conditions of the Lender; 4 .3 . 1.2 If cost of constructing the Project exceeds the amount of financing to be provided by the Agency pursuant to the Loan Agreement, a current financial statement and/or other documentation reasonably satisfactory to Executive Director for the purpose of demonstrating that Participant has adequate funds committed to cover the difference. FS213S3\014084-0012\2035994.3 G7/28/93 -10- 4 . 3 .2 Submission to Agency. Participant shall submit its Evidence of Financial Capability to the Agency for approval by the Executive Director on or before the date set forth in the Schedule of Performance. 4 . 3 . 3 ApAroval of Evidence of Financial Capabilit The Executive Director will notify Participant of his or her decision with respect to the Evidence of Financial Capability within thirty (30) days of Submission to the Agency by Participant . 4 .4 Liability; Worker' s Compensation; Automobile and V Builder' s Risk Insurance. Prior to the execution of this Agreement, Participant shall procure and maintain, at its sole cost �� and expense, in a form and content satisfactory to Agency, during . the entire term of this Agreement, the Regulatory Agreement and the Deed of Trust, the following policies of insurance: (a) Commercial General Liability Insurance. A policy of comprehensive general liability insurance written on a per occurrence basis in an amount not less than either (i) a combined single limit of TWO MILLION DOLLARS ($2, 000, 00 . 00) or (ii) bodily injury limits of ONE MILLION DOLLARS ($1, 000, 000 . 00) per person and TWO MILLION DOLLARS ($2 , 000, 00 .00) per occurrence and property damage limits of ONE MILLION DOLLARS ($1, 000, 000 . 00) per occurrence and ONE MILLION DOLLARS ($1, 000, 000 . 00) in the aggregate. Said policy is to include Broad Form Contractual Liability coverage, Completed Operations, Owner' s Broad Form Property Damage, 4 Installation Floater, Independent Contractor, Personal Injury and deletion of the "X" , "Y" and "U" exclusions. (b) Worker' s Compensation Insurance. A policy of worker' s compensation insurance in such amount as will fully comply with the laws of the State of California and which shall indemnify, insure and provide legal defense for both the Participant, Agency and the City against any loss, claim or damage arising from any injuries or occupational diseases occurring to any worker employed by or any persons retained by the Participant in the course of carrying out the work or services contemplated in this Agreement. (c) Property Insurance. A policy of "All Risks" hazard insurance providing for payment of replacement costs against damages by fire, extended coverage perils, earthquake (with a deductible not to exceed ten percent [10%�] of the loss) , vandalism and malicious mischief perils in an amount not less than one hundred percent (100%-) of the insurable value of the Site at completion of the rehabilitation of the Project . Agency shall be named a loss payee under a Lender' s Loss Payable Endorsement (Form No. 438BFU) until the Deed of Trust is reconveyed. Such policy shall contain an agreed value clause sufficient to eliminate any risk of co-insurance. FSZ383\014084-001=035994.3 07/28/93 0 All of the above policies of insurance shall be primary insurance and shall name Agency, City, and their officers, employees and agents as additional insureds . The insurer shall waive all rights of subrogation and contribution it may have against Agency, City, and their officers, employees and agents and their respective insurers . All of said policies of insurance shall provide that said insurance may not be amended or cancelled without providing thirty (30) days prior written notice by registered mail to Agency and City. In the event any of said policies of insurance are cancelled, the Participant shall, prior to the cancellation date, submit new evidence of insurance in conformance with this Section to the Executive Director. The policies of insurance required by this Agreement shall be satisfactory only if issued by companies qualified to do business in California, rated "A" or better in the most recent edition of Best Rating Guide, The Key Rating Guide or in the Federal Recrister, and only if they are of a financial category Class VII or better, unless such requirements are waived by the Risk Manager of the Agency ( "Risk Manager") due to unique circumstances . Participant shall provide in all contracts with contractors, subcontractors, architects and engineers that said contractor or subcontractor shall maintain the same policies of insurance required to be maintained by Participant pursuant to this Section. The Participant agrees that the provisions of this Section C shall not be construed as limiting in any way the extent to which the Participant may be held responsible for the payment of damages to any persons or property resulting from the Participant' s activities or the activities of any person or persons for which the Participant is otherwise responsible. 4 .5 Rights of Access . Representatives of Agency shall have the reasonable right of access to the Site without charges or fees, at any time during normal construction hours during the period of construction, for the purpose of assuring compliance with this Agreement including, but not limited to, the inspection of the work . of construction being performed by or on behalf of Participant . Such representatives of Agency shall be those who are so identified in writing to Participant by the Executive Director of Agency. Each such representative of Agency shall identify himself or herself at the job site office upon his or her entrance to the Site and shall provide owner or the construction superintendent or similar person in charge on the Site a reasonable opportunity to have a representative accompany him or her during the inspection. If the Agency, in its discretion, determines that any work or materials are not in conformity with the final plans and drawings or any other provisions of this Agreement, or any laws or ordinances, or not otherwise in conformity with the laws of the City, Agency may stop the work and order replacement or correction of any such work or materials on any portion of the Site, unless a similar use of ,such materials has been previously approved by FS2\383\0140U-0012\20359%.3 07/23/93 -12_ i • Agency for use on the Site . Inspection by Agency of the Site or any improvements thereon is not to be construed as an acknowledgment, acceptance or representation by Agency that there has been compliance with any plans approved pursuant to this Agreement or that the Site or any improvements thereon will be free from defect in design or construction or that the same is free of any faulty material or workmanship. Agency shall nullify, defend and hold Participant harmless from any injury or property damage caused or liability arising out of Agency' s exercise of this right of access . 4 . 6 Applicable Laws. Participant shall rehabilitate the Project in conformity with all applicable laws, including all applicable Federal and State labor laws . 4 . 7 Antidiscrimination During Construction. Participant, for itself and its successors and assigns, agrees that during the rehabilitation of the Project, Participant will not discriminate against any employee or applicant for employment because of race, color, creed, religion, sex, marital status, ancestry, or national origin. 4 . 8 Relocation Assistance. Participant waives any claims that it or any entities owned or controlled by it, and its successors and assigns may have to receive relocation assistance or benefits arising out of the work to be performed pursuant to this Agreement . 4 .9 Indemnification. During the period of rehabilitation of any of the Project pursuant to this Agreement and until such time as is issued a Certificate of Completion, Participant agrees to and shall indemnify and hold the Agency and the City harmless from and against all liability, loss, damage, cost or expenses (including reasonable attorneys' fees and court costs) arising from or as a result of (i) Participant' s failure to perform any obligations as and when required by this Agreement or any document referred to herein, (ii) the breach of any of Participant' s representations and warranties; and (iii) the death of any person or any accident, injury, loss, or damage whatsoever caused to any person or to the property of any person which shall occur on any of the properties subject to this Agreement and which shall be directly or indirectly caused by the acts done thereon or any errors or omissions of the Participant or its agents, servants, employees or contractors. Participant shall not be responsible for (and such indemnity shall not apply to) any acts, errors or omissions of the Agency or the City or their respective agents, servants, employees or contractors . Agency and City shall not be responsible for any acts, errors or omissions of any person or entity except Agency and City and their respective agents, servants, employees or contractors, subject to any and all statutory and other immunities . F52\383\014084-0012\2035994.3 07/28/93 4 . 10 Hazardous Substances . Participant represents and warrants that, to the best of Participant' s knowledge, after due and diligent inquiry and investigation, there exists no "Hazardous Materials" (as such term is herein defined) nor oil wells, underground storage tanks, or pipelines in, on, under, or about the Site except as set forth in Exhibit "L" attached hereto and incorporated herein by reference. Participant understands and agrees that in the event Participant incurs any loss or liability concerning Hazardous Materials and/or oil wells and/or underground storage tanks and/or pipelines whether attributable to events occurring prior to or following the Effective Date, then Participant may look to current or prior owners of the Site, but under no circumstances shall Participant look to Agency or City for any liability or indemnification regarding Hazardous Materials and/or oil wells and/or underground storage tanks and/or pipelines, unless it is finally determined by a court of competent jurisdiction that the City or the Agency directly caused said Hazardous Materials and/or oil wells and/or underground storage tanks and/or pipelines to become located on the Site. Participant, and each of the entities constituting Participant, if any, from and after the Effective Date, hereby waives, releases, remises, acquits and forever discharges Agency, City, their directors, officers, shareholders, employees, and agents , and their respective heirs, successors, personal representatives and assigns, of and from any and all Environmental C Claims, Environmental Cleanup Liability and Environmental Compliance Costs, as those terms are defined below, and from any and all actions, suits, legal or administrative orders or proceedings, demands, actual damages, punitive damages, loss, costs, liabilities and expenses, which concern or in any way relate to the physical or environmental conditions of the Site, the existence of any Hazardous Material thereon, or the release or threatened release of Hazardous Materials therefrom, whether existing prior to, at or after the Effective Date. It is the intention of the parties pursuant to this release that any and all responsibilities and obligations of Agency and City, and any and all rights, claims, rights of action, causes of action, demands or legal rights of any kind of Participant, its successors, assigns or any affiliated entity of Participant, arising by virtue of the physical or environmental condition of the Site, the existence of any Hazardous Materials thereon, or any release or threatened release of Hazardous Material therefrom, whether existing prior to, at or after the Effective Date, are by this Release provision declared null and void and of no present or future force and effect as to the parties . In connection therewith, Participant and each of the entities constituting Participant, expressly agree to waive any and all rights which said party may have under Section 1542 of the California Civil Code which provides as follows : "A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time P52\\3831014084-0012\2035994.3 07/28/93 -14- of executing the release, which if known by him must have materially affected his settlement with the debtor. " Participant and each of the entities constituting Participant, shall, from and after the Effective Date, defend, indemnify and hold harmless Agency, City and their officers, directors, employees, agents and representatives (collectively, the "Indemnified Parties" ) from and against any and all Environmental Claims, Environmental Cleanup Liability, Environmental Compliance Costs, and any other claims, actions, suits, legal or administrative orders or proceedings, demands or other liabilities resulting at any time from the physical and/or environmental conditions of the Site whether before or after the Effective Date or from the existence of any Hazardous Materials or the release or threatened release of any Hazardous Materials of any kind whatsoever, in, on or under the Site occurring at any time whether before or after the Effective Date, including but not limited to, all foreseeable and unforeseeable damages, fees, costs, losses and expenses, including any and all attorneys' fees and environmental consultant fees and investigation costs and expenses, directly or indirectly arising therefrom, and including fines and penalties of any nature whatsoever, assessed, levied or asserted against any Indemnified Parties to the extent that the fines and/or penalties are the result of a violation or an alleged violation of any Environmental Law. Participant further agrees that in the event Participant obtains, from former or present owners of the Site or any other persons or entities, releases from liability, indemnities, or other forms of hold harmless relating to the subject matter of this section, Participant shall use its diligent efforts to obtain for Agency and City the same releases, indemnities and other comparable provisions . For purposes of this Section 4 .12 , the following terms shall have the following meanings : (a) "Environmental Claim" means any claim for personal injury, death and/or property damage made, asserted or prosecuted by or on behalf of any third party, including, without limitation, any governmental entity, relating to the Site or its operations and arising or alleged to arise under any Environmental Law. (b) "Environmental Cleanup Liability" means any cost or expense of any nature whatsoever incurred to contain, remove, remedy, clean up, or abate any contamination or any Hazardous Materials on or under all or any part of the Site, including the ground water thereunder, including, without limitation, (i) any direct costs or expenses for investigation, study, assessment, legal representation, cost recovery by governmental agencies, or ongoing monitoring in connection therewith and (ii) any cost, expense, loss or ( damage incurred with respect to the Site or its operation as FS2X313W1408400IM035994.3 07/28/93 0 a result of actions or measures necessary to implement or effectuate any such containment, removal, remediation, treatment, cleanup or abatement . (c) "Environmental Compliance Cost" means any cost or expense of any nature whatsoever necessary to enable the Site to comply with all applicable Environmental Laws in effect . "Environmental Compliance Cost" shall include all costs necessary to demonstrate that the Site is capable of such compliance. (d) "Environmental Law" means any federal, state or local statute, ordinance, rule, regulation, order, consent decree, judgment or common-law doctrine, and provisions and conditions of permits, licenses and other operating authoriza- tions relating to (i) pollution or protection of the environment, including natural resources, (ii) exposure of persons, including employees, to Hazardous Materials or other products, raw materials, chemicals or other substances, (iii) protection of the public health or welfare from the effects of by-products, wastes, emissions, discharges or releases of chemical substances from industrial or commercial activities, or (iv) regulation of the manufacture, use or introduction into commerce of chemical substances, including, without limitation, their manufacture, formulation, labeling, distribution, transportation, handling, storage and disposal. C (e) "Hazardous Material" is defined to include any hazardous or toxic substance, material or waste which is or becomes regulated by any local governmental authority, the State of California, or the United States Government. The term "Hazardous Material" includes, without limitation, any material or substance which is : (i) petroleum or oil or gas or any direct or derivate product or byproduct thereof; (ii) 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, Division 20, Chapter 6 .5 (Hazardous Waste Control Law) ; (iii) defined as a "hazardous substance" under Section 25316 of the California Health and Safety Code, Division 20, Chapter 6 . 8 (Carpenter-Presley- Tanner Hazardous Substance Account Act) ; (iv) defined as a "hazardous material, 11 "hazardous substance, " or "hazardous waste" under Sections 25501 (j ) and (k) and 25501.1 of the California Health and Safety Code, Division 20, Chapter 6 . 95 (Hazardous Materials Release Response Plans and Inventory) ; (v) defined as a "hazardous substance" under Section 25281 of the California Health and Safety Code, Division 20, Chapter 6. 7 (Underground_ Storage of Hazardous Substances) ; (vi) "used oil" as defined under Section 25250 .1 of the California Health and Safety Code; (vii) asbestos; (viii) listed under Article 9 or defined as hazardous or extremely hazardous pursuant to Article 1 of Title 22 of the California Code of Regulations, F82\383\014084-001212035994.3 07/28/93 -1 6- Division 4 , Chapter 30; (ix) defined as waste or a hazardous substance pursuant to the Porter-Cologne Act, Section 13050 of the California water Code; (x) designated as a ,toxic pollutant" pursuant to the Federal Water Pollution Control Act, 33 U. S.C. § 1317; (xi) defined as a "hazardous waste" pursuant to the Federal Resource Conservation and Recovery Act, 42 U. S.C. § 6901 et sea. (42 U. S.C. § 6903) ; (xii) defined as a "hazardous substance" pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S. C. § 9601 et sea. (42 U.S.C. § 9601) ; (xiii) defined as "Hazardous Material" pursuant to the Hazardous Materials Transportation Act, 49 U.S.C. § 1801 et seq. ; or (xiv) defined as such or regulated by any "Superfund" or "Superlien" law, or any other federal, state or local law, statute, ordinance, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning Hazardous Materials and/or oil wells and/or underground storage tanks and/or pipelines, as now, or at any time hereafter, in effect. Notwithstanding any other provision of this Agreement, Participants release and indemnification as set forth in the provisions of this Section, as well as all provisions of this Section shall survive the termination of this Agreement and shall continue in perpetuity. 4 . 11 Certificate of Completion. Upon the Effective Date, Agency shall issue to Participant a Certificate of Completion; provided that the Project has been satisfactorily completed by Participant. The Certificate of Completion shall be, and shall so state, a conclusive determination of satisfactory completion of the Project required by this Agreement, and of full compliance with the terms of this Agreement relating to commencement and completion of the Project. After the date Participant is entitled to issuance of the Certificate of Completion, and notwithstanding any other provision of this Agreement to the contrary, any party then owning or thereafter purchasing, leasing, or otherwise acquiring any interest in the Site shall not (because of such ownership, purchase, lease, or acquisition) incur any obligation or liability under this Agreement, except that such party shall be bound by the covenants that survive issuance of the Certificate of Completion, which covenants are set forth in Sections 4 . 2 , 4. 4, 4 . 8, 4 . 10, 5. 1, 5. 2 and 5.3 of this Agreement and in the Regulatory Agreement, the Note, the Deed of Trust and the Financing Statement. A Certificate of Completion shall not be issued for less than the complete improvements and development of the entire Site. The Certificate of Completion is not a notice of completion as referred to in California Civil Code Section 3093 . If Agency refuses or fails to furnish a Certificate of Completion after written request from Participant, Agency shall, within ten (10) days of the written request, provide the Participant a written statement of the reasons Agency refused or FS2083\014084-0012\2035994.3 07/28/93 -1 7- failed to furnish a Certificate of Completion. The statement shall also contain the Agency' s opinion of the action Participant must take to obtain a Certificate of Completion. If the Agency shall have failed to provide such written statement within said ten (10) day period, Participant shall be deemed entitled to the Certificate of Completion. If Agency refuses or fails to furnish the Certificate of Completion for the reason that specific items or materials are not available or landscaping is not complete, Agency shall issue the Certificate of Completion upon the posting by Participant with Agency of a cash deposit, bond or irrevocable letter of credit (in a form acceptable to Agency) in an amount representing the fair value of the work not yet completed. SECTION 5 . USE OF THE SITE. 5 . 1 No Inconsistent Uses . Participant covenants and agrees, for itself, its successors, its assigns, and every successor in interest to the Site, or any part thereof, that for the period beginning on the Effective Date and ending on the date the Regulatory Agreement expires, Participant and such successors shall not devote the Site to uses inconsistent with the applicable zoning restrictions, this Agreement and the Regulatory Agreement; provided that, in the event of any inconsistency, the provisions of the Regulatory Agreement shall prevail over this Agreement. 5 .2 Regulatory Agreement. Concurrently with the execution of this Agreement, the Participant shall execute and record against the entire Site the Regulatory Agreement. Each and every term, provision, agreement, covenant, condition and restriction contained in the Regulatory Agreement is hereby expressly incorporated herein by reference as if fully set forth herein. The Regulatory Agreement shall be signed and acknowledged by all parties having record title interest in the Site, shall make the Agency and City parties thereto and shall be enforceable by the Agency and the City. 5 .3 Participant Covenants. Agency is deemed a beneficiary of the terms and provisions of this Agreement and of the restrictions and covenants running with the land appearing in the Regulatory Agreement for and in its own right for the purposes of protecting the interests of the community in whose favor and for whose benefit the covenants running with the land have been provided. The covenants in favor of Agency shall run without regard to whether Agency has been, remains or is an owner of any land or interest therein in the Site and shall be effective as both covenants and equitable servitudes against the Site. Agency shall have the right, if any of the covenants set forth in this Agreement which are provided for its benefit are breached, to exercise all rights and remedies and to maintain all actions or suits at law or in equity or other proper proceedings to enforce the obligations under this Agreement. With the exception of the City, no other P5213831014084-001Z2035994.3 07/28/93 -1 8- person or entity shall have any right to enforce the terms of this j" Agreement under a theory of third party beneficiary or otherwise. SECTION 6 . DEFAULTS AND REMEDIES . 6 . 1 Participant Defaults . The occurrence of any one or more of the following events shall constitute an "Event of Default" by Participant hereunder if, after receiving written notice from Agency as provided in Section 6 .3 below identifying such event, Participant fails to cure said event within ten (10) days if such event is a monetary default or Participant fails to cure said default within thirty (30) days, if such event is a non-monetary default; provided that if such non-monetary default is not capable of being cured within thirty (30) days Participant commences to cure said event within ten (10) days and diligently and in good faith continues to cure the event of default : 6. 1. 1 Participant fails to observe or perform any term or provision of this Agreement within the time set forth in this Agreement or any of the documents referred to herein; 6 .1.2 Participant fails to timely obtain all required permits and approvals for the Project which shall be determined in the sole and absolute discretion of Agency; 6 .1.3 Participant makes or delivers to Agency any statement, report, financial statement, or certificate that is not true or correct in any material respect; 6 . 1.4 Participant applies for the appointment of a receiver, trustee, or custodian for any of Participant' s assets; 6 . 1.5 Participant files a petition under any section or chapter of the Bankruptcy Code or any similar law or regulation; 6. 1. 6 Participant makes a general assignment for the benefit of its creditors; 6 .1.7 A petition under any section or chapter of the Bankruptcy Code or any similar law or regulation is filed against Participant, and such injunction, restraint, or petition is not dismissed within thirty (30) days after the entry or filing thereof; 6 . 1 . 8 Participant ceases to conduct its business substantially as now conducted; 6. 1.9 Participant is enjoined, restrained, or in any way prevented by court order from conducting all or any material part of its business affairs; FS2\333\014OW0012\2035994.3 07/28/93 -1 9- 6 . 1. 10 Participant becomes insolvent or admits in ( writing his inability to pay its debts as they mature; or 6 . 1 . 11 A notice of lien, levy, or assessment is filed of record with respect to all or any of Participant' s assets by the United States, or any department, agency or instrumentality thereof, or by any state, county, municipal, or other governmental agency, or if any taxes or debts owing at any time hereafter to any one of these becomes a lien or encumbrance upon any of Borrower' s assets or the Site and the same is not released within sixty (60) days after the same becomes a lien or encumbrance; provided that Participant shall have the right to contest in good faith and by appropriate proceedings any such lien, levy or assessment if Participant provides Agency with a bond or indemnity satisfactory to Agency assuring the payment of such lien, levy, or assessment; 6 . 1. 12 Any of Participant' s representations and warranties set forth in Section 3 . 1 of this Agreement is untrue or materially misleading. 6 .2 Agency Defaults . The occurrence of any one or more of the following events shall constitute an Event of Default by Agency hereunder: 6.2 . 1 Agency fails to observe or perform any term or provision of this Agreement within the time set forth in this _ Agreement and such failure is not cured to Participant' s reasonable ( satisfaction within thirty (30) days after Participant gives Agency written notice as provided in Section 6.3 below identifying such failure; provided that if said default cannot be cured within said thirty (30) day period, Agency shall not be in default of this Agreement if Agency commences to cure said default within thirty (30) days of said notice and diligently and in good faith continues to cure the default; 6.2 .2 Agency makes or delivers to Participant any statement, report, or certificate that is not true or correct in any material respect; or 6.2 .3 Any of Agency's representations and war- ranties set forth in Section 3 .2 of this Agreement is untrue or materially misleading. 6 . 3 Notice of Default . The non-defaulting party shall give written notice of any default under this Section 6 to the defaulting party, clearly specifying the default. Copies of any notice of default given to the defaulting party shall also be given to any permitted lender requesting such notice. Any failure or delay in giving such notice or in asserting any of either party's rights and remedies as to any default shall not constitute a waiver of any default, nor shall it change the time of default, nor shall ( it deprive either party of its rights to institute and maintain any FS2\383\014084-0012\2035994.3 07/28/93 -2 0- actions or proceedings which it may deem necessary to protect, assert or enforce any such rights or remedies . 6 .4 Remedies . In addition to any other rights or remedies set forth in this Section, either party may institute legal action to cure, correct, or remedy any default, to recover damages for any default, or to obtain any other remedy consistent with the purposes of this Agreement. Such legal actions must be instituted and maintained in the Superior Court of the County of Riverside, State of California, or in any other appropriate court in that county. Subject to any applicable cure periods and the general right to notice provided for in this Agreement, upon a default or breach of this Agreement by one party to this Agreement, the other party may bring an action for damages proximately caused thereby or for specific performance of this Agreement or any term or provision hereof. Participant agrees that Agency shall be entitled to the judicial remedy of specific performance and Participant agrees (subject to its reserved right to contest whether in fact a default does exist) not to challenge or contest the appropriateness of such remedy. In this regard, Participant specifically acknowledges that Agency is entering into this Agreement for the purpose of assisting in the redevelopment of the Site and not for the purpose of enabling Participant to speculate with land. 6 .5 Agency' s Right to Terminate. In the event that Participant has not acquired the Site prior to the date specified in the Schedule of Performance and Agency is not in default under l\ this Agreement and Participant commits a default hereunder and fails to cure such default within the time provided in Sections 6 . 1. 1 and 6 .3 ; then, in such event, Agency may withhold delivery of the Grant and deliver a thirty (30) day written notice of termination to Participant and, if the applicable default or condition has not been satisfied (or waived by Agency) within said time period, this Agreement shall terminate and neither party shall have any further rights against or liabilities to the other (except Agency reserves its rights under Section 6.4 if Participant is in default) . 6 . 6 Ricrhts and Remedies are Cumulative. Except as otherwise expressly stated in this Agreement, the rights and remedies of the parties hereto are cumulative, and the exercise by any party of one or more of its rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by another party. 6. 7 Participant Non-Profit. Agency acknowledges that it has received financial statements of Participant from Participant and that Participant is a nonprofit public benefit corporation without members and without assured sources of funding or capital . Notwithstanding any provision or obligation to the contrary contained in this HRA, (a) the liability of Participant under this FS2\.383\014084-0012\2035994.3 07/28/93 -2 1- HRA to Agency and its successors and assigns, is limited to Participant's interest in the Project and the Site and Agency shall look exclusively thereto, or to such other security as may from time to time be given for the payment of obligations arising out of this HRA; and (b) from and after the date of this HRA, no deficiency or other personal judgment, nor any order or decree of specific performance (other than pertaining to this HRA, any agreement pertaining to the Site or the Project or any other agreement securing Participant's obligations under this HRA) , shall be rendered against: (i) Participant; (ii) the assets of Participant (other than Participant's interest in the Project or the Site and the rents, issues and profits thereof, any agreement pertaining to the Site or any other agreement securing Participant's obligations under this HRA) ; or (iii) its officers, directors, agents or members or their heirs, personal representatives, successors, transferees or assigns, as the case may be, in any action or proceeding arising out of this HRA, or any agreement securing the obligations of Participant under this HRA, or any judgment, order or decree rendered pursuant to any such action or proceeding. Notwithstanding the foregoing, Participant shall have personal liability for one hundred percent (100%) of the costs or damages arising from any of the following: (i) fraud or intentional material misrepresentation which induce Agency to enter into the transaction evidenced by this HRA and the documents referred to therein, including the Note, the Deed of Trust and the Regulatory Agreement; (ii) commission of waste; (iii) causing cancellation of any of the insurance required pursuant to the Deed of Trust; (iv) intentional failure to observe and comply with all applicable laws, ordinances, regulations; and (v) the intentional misapplication of (a) proceeds paid, prior to any foreclosure of the Site, under any insurance policy by reason of damage, loss, or destruction to any portion of the site (to the full extent of such proceeds) ; (b) any proceeds or awards resulting from the condemnation, prior to any foreclosure, of all or any part of the Site (to the full extent of such proceeds or awards) ; and/or (c) gross receipts from rental of the Site received or applicable to a period prior to any foreclosure of the Site after notice of default, which gross receipts are deemed to be the property of Agency, including without limitation, the collection and retention of any such gross receipts after any notice of default or foreclosure or exercise of other remedies by Agency (following any applicable cure periods) has been given to Participant. SECTION 7. GENERAL PROVISIONS. 7. 1 standards of Review. The Agency's and Executive Director's approval(s) under this Agreement shall not be unreasonably withheld. Any disapproval by Agency or Executive Director shall state in writing the reasons for disapproval and the changes which Agency or Executive Director requests to be made. Such reasons and such changes must be consistent with any items previously approved hereunder. Any item submitted to and approved FS2uuw140U-W12W5M.3 09a3m -22- in writing by Agency or Executive Director shall not be subject to subsequent disapproval . An approval by Agency or Executive Director under this Agreement shall not be deemed as a waiver of any requirements that may be imposed by City. 7 .2 Governing Law. The laws of the State of California shall govern the interpretation and enforcement of this Agreement. 7.3 Attorney' s Fees . In the event of litigation between the parties arising out of this Agreement, the prevailing party shall be entitled to recover its reasonable attorneys' fees and other costs and expenses incurred, including attorneys' fees on appeal and all other reasonable costs and expenses for investigation of such action, including the conducting of discovery, in addition to whatever other relief to which it may be entitled. 7 .4 Notices Demands and Communications Between the Parties . Formal notices, demands, and communications between Agency and Participant shall be sufficiently given if: (i) person- ally delivered; (ii) delivered by overnight courier (acknowledged by receipt) ; or (iii) dispatched by registered or certified mail, postage prepaid, return receipt requested, to the addresses set forth below: If to Participant: CORPORATE FUND FOR HOUSING 100 Pacifica, Suite 470 Irvine, CA 92718 I Attn: Barry Kamel With a copy to: Dean V. Ambrose, Esq. 3200 Olympic Boulevard Santa Monica, CA 90404 If to Agency: THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALM SPRINGS, CALIFORNIA 3200 East Tahquitz Canyon Way Palm Springs, CA 92262 Attn: Executive Director With a copy to: RUTAN & TUCKER 611 Anton Blvd. , Suite 1400 Costa Mesa, CA 92626 Attn: David J. Aleshire, Esq. All notices shall be deemed to be received as of the earlier of actual receipt by the addressee thereof or the expiration of forty- eight (48) hours after depositing in the United States Postal System in the manner described in this Section. 7 . 5 Acceptance of Service of Process. In the event that any legal action is commenced by Participant against Agency, c F=383\014084-0012\2035994.3 07/23/93 -2 3- service of process on Agency shall be made by personal service upon Executive Director or the Secretary of Agency, or in such other manner as may be provided by law. In the event that any legal action is commenced by Agency against Participant, service of process on Participant shall be made by personal service upon Participant or in such other manner as may be provided by law, and shall be valid whether made within or without the State of California. 7. 6 Conflicts of Interest. No member, official, or employee of Agency 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 this Agreement which affects his personal interests or the interests of any cor- poration, partnership, or association in which he is, directly or indirectly, interested. 7. 7 Nonliability of Agency Officials and Employees. No member, official, employee, or consultant of Agency or City shall be personally liable to Participant, or any successor in interest of Participant, in the event of any default or breach by Agency or for any amount which may become due to Participant or to its successor, or on any obligations under the terms of this Agreement. 7. 8 Books and Records. C' 7. 8 .1 Maintenance of Books and Records . Partici- pant shall prepare and maintain all books, records and reports necessary to substantiate Participant's compliance with the terms of this Agreement or reasonably required by the Agency. 7. 8 .2 Right to Inspect. Either party shall have the right, upon not less than seventy-two (72) hours notice, at all reasonable times, to inspect the books and records of the other party pertaining to the Site as pertinent to the purposes of this Agreement. Said right of inspection shall not extend to documents privileged under attorney-client or other such privileges. 7. 9 Ownershilp of Documents . Copies of all drawings, specifications, reports, records, documents and other materials prepared by Participant, its employees, agents and subcontractors, in the performance of this Agreement, which documents are in the possession of Participant and are not confidential shall be delivered to Agency upon request in the event of a termination of this Agreement arising out of an Event of Default, and Participant shall have no claim for additional compensation as a result of the exercise by Agency of its rights hereunder. The Agency shall have an unrestricted right to use such documents and materials as if it were in all respects the owner of the same. Participant makes no warranty or representation regarding the accuracy or sufficiency of such documents for any future use by Agency, and Participant shall have no liability therefor. Notwithstanding the foregoing, the Agency shall not have any right to sell, license, convey or PS213831014084-0012\2035994.3 07/28/93 -2 4- transfer the documents and materials to any third party, or to use (' the documents and materials for any other site, except in the case of a termination of this Agreement due to default of Participant. 7. 10 Intentionally Deleted. 7. 11 Titles and Captions . Titles and captions are for convenience only and shall not constitute a portion of this Agreement . 7. 12 Gender. 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 . 7.13 Modifications . Any alteration, change or modification of or to this Agreement, in order to become effective, shall be made by written instrument or endorsement thereon and in each such instance executed on behalf of each party hereto. 7. 14 Merger of Prior Agreements and Understandings . This Agreement and all documents incorporated herein contain the entire understanding among the parties hereto relating to the transactions contemplated herein and all prior or contemporaneous agreements, understandings, representations, and statements, oral or written, are merged herein and shall be of no further force or effect. 7.15 No Third Parties Benefited. This Agreement shall create no other third party beneficiary rights or any other rights in favor of any persons, firms or corporations. This Agreement is for the sole use and benefit of the parties hereto and is not for the use or benefit of any other person or entity. 7. 16 Assurances to Act in Good Faith. Agency and Participant agree to execute all documents and instruments and to take all action, including deposited funds in addition to such funds as may be specifically provided for herein and as may be required for the development of the Site as herein contemplated and shall use their best efforts to accomplish the development of the Site in accordance with the provisions hereof. Agency and Participant shall each diligently and in good faith pursue the satisfaction of any conditions or contingencies subject to their approval . 7. 17 Interpretation. The terms of this Agreement shall be construed in accordance with the meaning of the language used and shall not be construed for or against either party by reason of the authorship of this Agreement or any other rule of construction which might otherwise apply. 7. 18 Time For Accelptance of Agreement By AcTency. This Agreement, when executed by Participant and delivered to Agency ( must be authorized, executed and delivered by Agency not later than FS2U831014CM-001=035994.3 07/28/93 -2 5_ the time set forth in the Schedule of Performance or this instrument shall be void, except to the extent that Participant 1 shall consent in writing to further extensions of time for the 1 authorization, execution and delivery of this Agreement . After execution by Participant, this Agreement shall be considered an irrevocable offer until such time as such offer shall become void due to the failure of the Agency to authorize, execute and deliver this Agreement in accordance with this Section. 7.19 Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument . 7 .20 Severability. Wherever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable law. If, however, any provision of this Agreement shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement . 7.21 Extension of Times of Performance. Time is of the essence of the performance of this Agreement. Notwithstanding the foregoing, in addition to the specific provisions of this Agreement, performance by either party hereunder shall not be deemed to be in default during an event of Force Majeure. An C extension of time for an event of Force Majeure shall be limited to the period of such event, and shall commence to run from the time of the commencement of the cause, provided notice by the party claiming such extension is sent to the other party within ten (10) days of the commencement of the cause. In the event of such delay, the party delayed shall continue to exercise reasonable diligence to minimize the period of delay. Times of performance under this Agreement may also be extended by mutual written agreement by Agency and Participant. The Executive Director shall have the authority on behalf of Agency to approve extensions of time not to exceed a cumulative total of one hundred eighty (180) days. F52\383\014084-0012\2035994.3 07/28/93 -2 IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be effective as of the date first written above (the f "Effective Date" ) . ATTEST: THE CO LOPMENT AGENCY OF CITY OF PALM S GS, CALIFORNIA ( "A*Exive By: LL ` Secreta e for 4 APPROVED AS TO FORM: RUTAN & TUCKER BY. !� David Aleshire, Esq. Agency Counsel CORPORATE FUND FO HOUSIN , a California nonprofit en co ation By: C Its : 0 By. Its : APPROVED BY THE COMMUNITY REDEV. AGENCY BY RES. NO. A C(- C, - 33 FS'Z38M014084-W1212035994.3 (17129/93 -27- CIEFU CIAME OF oK3H CE This cerdflas that STA7fE FARM OND CASUALTY COMPANY, Bloomington, Illinois. STATE FARM GENERAL INSURANCE COMPANY, Bloomington, Illinois insures the'following policyholder for Via coverages indicated below: Name of policyholder Corporate Fund For Housing Address of policyholder C/O Insignia Management 42335 Washington Street Suite F307 Location of operations Palm Desert , California 92211-8031 I� Fj 1997 -----all------ w;l VOLdDY I�aDL�tarr� u�'rnD®�r IN�sftaaaNr�� Fouc1P l�Etao®® dlE2l i OF LBABIQaI'uif Uf7©o@dey�Oa¢o Eacpdso¢inct®u2cd LX� comprehensive 92—UR-3392-5 F General Liabild 9 30 97 9 30 98 BODILY INJURY . .-------------'--------'...- -------'."---------- ._.------- ---/-----/-- /-----/98---- ❑ Dual Ldmdts for: ❑ Manufacturers and Each Occurrence --' --------- - ----- Contractors L'eabllity ------ ------- ------------- ------------------- Aggregate �S ❑ Owners, Landlords, -- - and Tenants Llabild PROPERTY DAMAGE — — -------- .-------- --""--y----- ---.... -------------------------- Each Occurrence $ This insurance includes: ❑ Products-Completed Operations Aggregate' ❑ Owners or Contractors Protective Liability BODILY INJURY AND El Contractual Liability PROPERTY DAMAGE El Professional Errors and Omissdons Combined Single Limit for: ❑ Broad Form Property Damage Each Occurrence (�2 nnn nnn ❑ Broad Form Comprehensive General Liability Aggregate 4,1100 — -. POLL CV OrmnlOD CONTRACTUAL LIABILITY LIMITS(if different from above) Ea®I�EGSV N�7fu9Bl= TRPpP Or IG25¢96¢ACfCB rOUG UG Omo Extslra¢ioa DE20 BODILY INJURY Each Occurrence PROPERTY DAMAGE Each Occurrence Aggregate EXCESS LIABILI T 1° — BODILY INJURY AND PROPER TY DAMAGE (Combined Single Limit) ❑ Umbrella Each Occurrence $ ❑ Other Aggregate $ Part i STATUTORY ❑ Workers' Compansation Part 2 BODILY INJURY and Employers Liability Each Accident Disease Each Employee ¢b Disease-Policy Limit y" A,,,,l- t vpplk If 0. ,�brdB,e d Te.W Ue 11Ky InsNplp9 axcludae st.duw CHord11.,rna consV 1w,,ai ds..Nv.1 0 HM C2P a iMCATE OF 1PASUNAMC,'E-: lS N®r a COM 7 2na4 or oMSURAWcr AMD MDOTaER ArHRiAATdVL,:r.V MOR NEGATWELY&MENUS, =ErIDS,On faLVERS THE Werra€AGE APPROVED DY ALNV POLICtf DBBCCFHSR©IIERMV& Name and Address of Certificate Folder SNneture d AulhWZR Ra use hve City of Palm Springs Housing Rehabilitation Agreement, A317C Agent City Clerk, City of Palm Springs PC Box 2743 NnvamhPr 6 1997 Palm Springs, California 92263-2743 STATE FARM CLAYTON INSUUNCE AGENCY,INC. License 9041 Boulevard � 16167 E.Whittier Soulevard F&M10 Rw 091 an In Us A. Whittier,CA 90603 G/)j NSURANt© Bus (562)947-4795(714)774.4680