4868-3254-9521v3/022620-0108
COOPERATION AGREEMENT
(CalOptima Funding)
This COOPERATION AGREEMENT (CalOptima Funding) (“Cooperation Agreement”) is dated as of December 5, 2023 (“Date of Agreement”) and entered into by and between the CITY OF ANAHEIM , a charter city and California municipal corporation (“City”), and the ANAHEIM HOUSING AUTHORITY, a public body, corporate and politic (“Authority”).
R E C I T A L S
A. City is a California municipal corporation and charter city.
B. Authority is a California housing authority acting under the California Housing Authorities Law, Part 2 of Division 24, Section 34200, et seq., of the Health and Safety Code (“HAL”).
Further, Authority serves as the housing successor to the former Anaheim Redevelopment Agency (“Former Agency”) and administers the housing assets and funds of the Low and Moderate Housing Asset Fund (“LMIHAF”) pursuant to Health and Safety Code (“HSC”) Sections 34176 and 34176.1.
C. Authority and Manchester Housing Partners LP, a California limited partnership (“Developer”) entered into that certain Affordable Housing Agreement (Manchester Orangewood) dated as of March 1, 2020 (“Original Agreement”) that relates to the construction, completion, operation, and management of a 102-unit affordable housing project now called Finamore Place (“Project”).
D. Pursuant to the Original Agreement, Authority, as Landlord, and Developer, as Tenant, entered into that certain unrecorded Ground Lease (Manchester Orangewood) dated as of March 1, 2020 for which a Memorandum of Ground Lease (Manchester Orangewood) was recorded in the Official Records, County of Orange, State of California (“Official Records”) on March 19, 2020 as Instrument No. 2020-000125688. The parties also entered into that certain Ground Lease Implementation Agreement (Commercial Component) (“Implementation Agreement”) dated as of May 18, 2023 relating to the implementation, terms and conditions of the Sublessees in occupancy of certain commercial space, onsite parking, and the ingress/egress and circulation within the Project.
The Ground Lease (Manchester Orangewood) together with the Implementation Agreement are referred to herein as the “Original Ground Lease”.
E. In implementation of the Original Agreement, Authority and Developer also entered into a series of documents and instruments, also each dated as of March 1, 2020, including without limitation that certain (i) Regulatory Agreement (“Regulatory Agreement”) recorded in the Official Records by Instrument No. 2020-000125690, (ii) Authority Other Funds Note, Promissory Note Secured by Deed of Trust, a promissory note evidencing the Authority Other Funds Loan issued by Authority to Developer (“Original Authority Other Funds Note”), (iii) Authority Other Funds Deed of Trust and Assignment of Rents as r ecorded in the Official Records as Instrument No. 2020- 000125695, which secures the Original Authority Other Funds Note (“Original Authority Other Funds Deed of Trust”), and (iv) other instruments related to implementation of the Original Agreement that are referred to therein as part of the Project Documents.
F. CalOptima Health, a California public agency (“CalOptima”), was founded by the community as a County Organized Health System that offers health insurance programs for low - 2 4868-3254-9521v3/022620-0108
income children, adults, seniors and people with disabilities. CalOptima has an ongoing commitment to Orange County's vulnerable population of people experiencing homelessness, and operates a grant program to facilitate and accelerate the creation of affordable and permanent supportive housing units, including in Anaheim.
G. In August 2023, the City of Anaheim, a municipal corporation and charter city, through its Housing and Community Development Department (“City”), prepared and submitted an application to CalOptima seeking an award of capital grant funds for the Project under the Department of Health Care Services’ Housing and Homelessness Incentive Program (“HHIP”). CalOptima awarded the City One Million Five Hundred Thousand Dollars ($1,500,000) (“CalOptima Funding”) By this Cooperation Agreement, the intends to authorize the transfer to the Authority of the CalOptima Funding as an additional source of funding for the Project. Then the CalOptima Funding will be loaned by the Authority to Developer and added to the principal due under the Original Authority Other Funds Note, as amended by (i) this First Amendment to Agreement, (ii) as evidenced by that certain First Amendment to Authority Other Funds Note Promissory Note Secured by Deed of Trust (“First Amendment to Authority Other Funds Note”), and (iii) as secured by that c ertain First Modification of Deed of Trust and Assignment of Rents (Authority Other Funds Deed of Trust) (“First Modification of Deed of Trust”), the form of which amendments were considered and approved by the Authority of even date herewith.
H. The CalOptima Funding awarded to the City, transferred to the Authority, and then loaned to the Developer shall be expended for the benefit of the residents of the Project and tied to participation in the HHIP, which allows the CalOptima Funding to fund affordable and permanent supportive housing. HHIP aims to prevent and address housing insecurity for Medi -Cal members by ensuring those experiencing homelessness have a clear path into housing and can access the services needed to remain housed; a nd many residents at the Finamore Place Project will be served with this additional funding.
I. Due to increased costs incurred in the construction, completion, and ongoing operation of the Finamore Place Project, Developer requested additional funding from the Authority, and by the instruments referenced in Recital G. above, the Authority will loan to Developer an additional Two Million Seven Hundred Fifty Thousand Dollars ($2,750,000) on the terms and conditions set forth therein, which amount will be a two-tiered tranche comprised of: (1) One Million Five Hundred Thousand Dollars ($1,500,000.00) sourced from the CalOptima Funding transferred to the Authority by this Cooperation Agreement , and (2) One Million Two Hundred Fifty Thousand Dollars ($1,250,000.00) sourced from the Authority’s Low to Moderate Income Housing Asset Fund (“LMIHAF”, and herein the $1.25M is referred to as the “LMIHAF Funding”).
J. Based on such additional funding, the amended, cumulative principal amount of the Authority Other Funds Loan will be Five Million Nine Hundred Fifty-One Thousand Three Hundred Eighty-Eight Dollars ($5,951,388) (“Amended Authority Other Funds Note Amount”).
K. Capitalized terms used in this Cooperation Agreement are as defined in the Original Agreement and Original Ground Lease unless otherwise defined herein.
L. In connection with this matter and related matters affecting additional funding to the Developer for the Project, Developer has opened escrow and title accounts with First American Title Insurance Company, National Commercial Services (“First American”), at the issuing office located at 18500 Von Karman Ave, Suite 600, Irvine, CA 92612, Order No. NCS -810632C-SA1, 3 4868-3254-9521v3/022620-0108
Reference No. NWC Manchester and Orangewood in Anaheim, Escrow Officer Ryan Hahn, Title Officer Jeffery Paschal (“First American NCS-810632C-SA1”).
M. In implementation of the First Amendment to Agreement, First Amendment to Authority Other Funds Note, and First Modification of Deed of Trust, the City desires and intends by this Cooperation Agreement to transfer to the Authority the CalOptima Funding to assist in the financing, completion of development, and operation of Finamore Place.
N. Based upon the foregoing, the City desires to make available and transfer to the Authority hereby the CalOptima Funding of $1,500,000, and the City approves the Authority loaning such funds to the Developer as a part of the Authority Other Funds Loan.
NOW, THEREFORE, FOR AND IN CONSIDERATION OF THE MUTUAL
PROMISES, COVENANTS AND CONDITIONS CONTAINED HEREIN, THE PARTIES AGREE AS FOLLOWS:
Section 1. TRANSFER OF FUNDS BY CITY TO AUTHORITY. City agrees to transfer to Authority the CalOptima Funding of $1,500,000 for the Authority to loan to Developer as additional monies loaned under the Authority Other Funds Loan.
Section 2. LIABILITY AND INDEMNIFICATION. In contemplation of the provision of Section 895.2 of the California Government Code imposing certain tort liability jointly upon public entities solely by reason of such entities being parties to an agreement as defined by Section 895.4 and 895.6 of such Code, each of the Parties, as between themselves, pursuant to the authorization contained in Section 895.4 and 895.6 of such Code, will each assume the full liability imposed on it, or any of its officers, agents, or employe es by law for injury caused by negligent or wrongful act or omission occurring in the performance of this Cooperation Agreement to the same extent that such liability would be imposed in the absence of Section 895.2 of such Code. (a) To achieve the above-stated purposes, each Party indemnifies and holds harmless the other Party for any loss, costs or expense that may be imposed upon such other Party solely by virtue of such Section 895.2. The provisions of Section 2778 of the California Civil Code are made part hereof as if fully set forth herein.
Section 3. EFFECTIVE DATE. This Cooperation Agreement shall take effect from and after the date of approval hereof by the Authority Board and the City Council.
Section 4. REPRESENTATIONS AND WARRANTIES.
(a) Representations and Warranties of Authority. Authority hereby represents and warrants to City as follows:
(i) Authority of Anaheim Housing Authority. Authority represents and warrants to City it is a public body, corporate and politic, duly existing pursuant to the HAL, and it has been authorized to transact business pursuant to action of the City Council. Authority has full power and authority to execute and deliver this Cooperation Agreement and to accept the CalOptima Funding contemplated hereunder, to execute and deliver documents or instruments, if any, executed and delivered, or to be executed and delivered, pursuant to the First Amendment to Agreement, First 4 4868-3254-9521v3/022620-0108
Amendment to Authority Other Funds Note, and First Modification of Deed of Trust , and to perform and observe the terms and provisions of all of the above. (ii) Authority of Persons Executing Documents . This Cooperation Agreement and all other documents or instruments executed and delivered, or to be executed and delivered, pursuant to this Cooperation Agreement have been executed and delivered by persons who are duly authorized to execute and deliver the same for and on behalf of Authority, and all actions required under Authority’s organizational documents and applicable governing law for the authorization, execution, delivery and performance of this Cooperation Agreement and all other documents or instruments executed and delivered, or to be executed and delivered, pursuant to this Cooperation Agreement, have been duly taken.
(b) Representations and Warranties of City. City represents and warrants to Authority that it is a charter city and municipal corporation. City has full right, power and lawful authority to enter into this Cooperation Agreement and the execution, performance and delivery of this Cooperation Agreement by City, and persons on behalf of City, have been fully authorized by all requisite actions on the part of the City Council.
Section 5. DEFAULT AND REMEDIES.
(a) Events of Default. Failure by either Party to duly perform, comply with, or observe any of the conditions, terms, or covenants of this Cooperation Agreement shall be an Event of Default. The Party who so fails or delays must immediately commence to cure, correct or remedy such failure or delay, and shall complete such cure, correction or remedy with reasonable diligence and during any period of curing shall not be in default. The injured Party shall give written notice of default to the Party in default, specifying the default complained of by the injured Party. If the default is not commenced to be cured within thirty (30) days after service of such notice of default and is not cured promptly in a continuous diligent manner in a reasonable period of time after commencement, the defaulting Party shall be liable for any damages caused by such default, and the non-defaulting Party may thereafter commence action for damages with respect to such default or for specific performance of this Cooperation Agreement.
(b) Remedies. The occurrence of an Event of Default by Authority that is not cured within the time set forth herein shall relieve City of any obligation to disburse the Project Funds. The Authority may seek specific performance of this Cooperation Agreement for City’s failure to provide the Project Funds as provided under this Cooperation Agreement. The non-defaulting Party may seek money damages or any other remedy available at law or equity against the defaulting Party for an Event of Default hereunder.
Section 6. MISCELLANEOUS.
(a) Time. Time is of the essence in this Cooperation Agreement. (b) No Third Parties Benefited. This Cooperation Agreement is made and entered into for the sole protection and benefit of City, its successors and assigns, and the Authority, its successors and assigns, and no other person or persons shall have the right of action hereon. (c) Successors and Assigns. The terms hereof shall be binding upon and inure to the benefit of the successors and assigns of the parties hereto; provided, however, that no assignment 5 4868-3254-9521v3/022620-0108
of Authority’s rights hereunder shall be made, voluntarily or by operation of law, without the prior written consent of City and that any such assignment without said consent shall be void. (d) Construction of Words . Except where the context otherwise requires, words imparting the singular number shall include the plural number and vice versa, words imparting persons shall include firms, associations, partnerships and corporations, and words or either gender shall include the other gender.
(e) Partial Invalidity. If any provision of this Cooperation Agreement shall be declared invalid, illegal, or unenforceable, the validity, legality, and enforceability of the remaining provisions hereof shall not in any way be affected or impaired. (f) Governing Law. This Cooperation Agreement and any instruments given pursuant hereto shall be construed in accordance with and be governed by the laws of the State of California.
(g) Amendment. This Cooperation Agreement may not be changed orally, but only by agreement in writing signed by Authority and City.
(h) Captions and Headings. Captions and headings in this Cooperation Agreement are for convenience of reference only, and are not to be considered in construing the Cooperation Agreement.
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IN WITNESS , THE PARTIES HAVE EXECUTED THIS COOPERATION AGREEMENT (CalOptima Funding) AS OF THE EFFECTIVE DATE IN THE FIRST PARAGRAPH ABOVE.
CITY
CITY OF ANAHEIM, a California municipal
corporation and charter city
Dated: , 2023 By:
Grace Ruiz-Stepter, Director of
Housing and Community Development
Department or Authorized Designee
ATTEST
THERESA BASS
City Clerk or Authorized Designee
APPROVED AS TO FORM
OFFICE OF THE CITY ATTORNEY
Ryan O. Hodge, Deputy City Attorney
or Authorized Designee
AUTHORITY:
ANAHEIM HOUSING AUTHORITY, a public
body, corporate and politic
By:
Grace Ruiz-Stepter, Executive Director
ATTEST
THERESA BASS
City Clerk or Authorized Designee
APPROVED AS TO FORM
OFFICE OF THE CITY ATTORNEY
Ryan O. Hodge, Deputy City Attorney
or Authorized Designee