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lockouts or other labor disputes, acts or omissions of another party, or acts or failures to act of City or any other public or governmental agency or entity (excepting that acts or failures to act of Authority or City shall not excuse performance by Authority or City)
or any other cause not reasonably within
the control of Developer
. Notwithstanding anything to the contrary in this Agreement, an extension of time for any such cause shall only be for the period of the
resulting
delay and shall apply only i
f notice
by the party claiming such extension is sent to the other party within thirty (30) days of the commencement of the cause. Notwithstanding any provision of this Agreement to the contrary, the inability to obtain funds for payments, or an allocatio n by CDLAC or the lack of issuance of the Bonds,
or the lack of funding to complete the Improvements or the inability to accomplish the provision of water service to the Site (or any potion thereof) shall not constitute grounds of enforced delay pursu
a
nt
t
o this Section.
In addition to the foregoing (and without regard to the preceding portion of this
Section
), the
Executive Director shall have the authority, at his discretion, to approve extensions of construction and repair deadlines
not to exceed a cumulative total of three hundred sixty (360) days , provided that each
such extension is in writing.
7.11 Non
-
Liability of Officials and Employees of Authority
.
No member, official, officer
or employee of Authority or City shall be personally liable to Developer, or any successor in interest, in the event of any Default or breach by Authority (or City) or for any amount which may become due to Developer or its suc
cessors, or on any obligations under the terms of this Agreement.
7.12 Relationship Among Authority, City and Developer
. It is hereby acknowledged that
the relationship among Authority, City and Developer is not that of a partnership or joint venture and that Authority, City and Developer shall not be deemed or construed for any purpose to be the agent of the other. Accordi
ngly, except as expressly provided in this Agreement, including the Attachments hereto, neither Authority nor City shall have rights, powers, duties or obligations with respect to the development, operation, maintenance or management of the Improvements.
7.13 Authority and City Approvals and Actions
.
Whenever a reference is made herein
to an action or approval to be undertaken by Authority, the Executive Director is authorized to act on behalf of Authority unless specifically provided otherwise or the law otherwise requires. When a reference is made h
erein to an action or approval to be undertaken by City the City Manager is authorized to act on behalf of City unless specifically provided otherwise or the law otherwise requires.
7.14 Real Estate Brokers
. Authority and Developer each represent and warrant to each other that no broker or finder is entitled to any commission or finder’s fee in connection with this transaction, and each agrees to defend and hold harmless the other from any claim to any such co
mmission or fee resulting from any action on its part.
7.15 Attorneys’ Fees
.
In any action among the parties to interpret, enforce, reform, modify, rescind, or otherwise in connection with any of the terms or provisions of this Agreement, the prevailing party in the action shall be entitled, in addition to any other relief to which
it might be
entitled, reasonable costs and expenses including, without limitation, litigation costs and reasonable attorneys’
fees.
7.16 Limitation Upon Funding
.
Excepting for the extent to which the Authority is making land and certain resources available to the extent expressly provided under this Agreement, the Authority shall not provide any funding to Developer or with respect to the property that is the subje ct
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of this Agreement. City shall not provide any funding under this Agreement or to Developer.
Developer covenants to refrain from requesting any funding from City or Authority.
7.17 Limited Non
-
recourse Liability of Developer
.
Notwithstanding anything to the
contrary in this Agreement or any other Project Document,
Developer’s
partners shall
not
be personally
liable for any default, loss, claim, damage, expense or liability to any person, and the sole recourse of Authority or City against Developer shall be limited to the assets of Developer .
8. MISCELLANEOUS
.
8.1 Obligations Unconditional and Independent
. Notwithstanding the existence at any
time of any obligation or liability of Authority to Developer, or any other claim by Developer against Authority, in connection with the Site or otherwise, Developer hereby waives any right it might otherwise have (a)
t
o offset any such obligation, liability or claim against Developer’s obligations under this Agreement (including without limitation the attachments hereto), or (b)
to claim that the
existence of any such outstand
ing obligation, liability or claim excuses the nonperformance by Developer of any of its obligations under the Project Documents .
8.2 Notices
. All notices, statements, demands, requests, consents, approvals, authorizations, offers, agreements, appointments or designations hereunder by any party to the others shall be in writing and shall be given either by (i)
by reputable document delivery servi
ce such as
Federal Express that provides a receipt showing date and time of delivery, or (ii)
mailing in the United
States mail, certified or registered mail, return receipt requested, postage prepaid, and addressed as follows:
If to Developer:
Wakeland
Highland
LP
1230 Columbia St., Suite 950
San Diego, CA 92101
Attn: Vice President of Real Estate Development
With a copy to:
(which copy shall not constitute notice to Developer)
Goldfarb & Lipman
1300 Clay Street
11th Floor
Oakland, CA 94612
Attn: Heather Gould
If to Authority:
Highland Housing Authority
27215 Base Line
Highland, CA 92346
Att
ention: Executive Director
with copy to:
Assistant Executive Director
Highland Housing Authority
27215 Base Line
Highland, California 92346
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If to City: City of Highland
27215 Base Line
Highland, California 92346
Att
ention: City Manager
with copy to:
Richards Watson & Gershon
350 South Grand Avenue, 37th Floor
Los Angeles
, California 90071
Attention:
Maricela Marroquin, City Attorney
Addresses for notice may be changed from time to time by written notice to all other parties.
All communications shall be effective when actually received; provided, however, that nonreceipt of any communication as the result of a change of address of whi ch the sending party was not notified or
as the result of a refusal to accept delivery shall be deemed receipt of such communication.
Authority
will provide copies to Developer's investor limited partner, following receipt of the contact information of such investor limited pa
rtner.
8.3 Survival of Representations and Warranties
. All representations and warranties in
the Project Documents shall survive the Closing and the rental of the Required Affordable Units and have been or will be relied on by Authority notwithstanding any investigation made by Authority.
8.4 No Third Parties Benefited; AB
987
. This Agreement is made for the purpose of
setting forth rights and obligations of Developer, City,
and Authority, and no other person shall have
any rights hereunder or by reason hereof.
T
here shall be no third party beneficiaries of this Agreement.
Developer acknowledges that, notwithstanding the foregoing portion of this Section
8.4, pursuant to
AB
987 and the amendments to Health and Safety Code Section
33334.3 made effective as of
Janu
ary
1, 2008 by that bill, it i
s possible that violations of the covenants, conditions and restrictions relating to affordable housing contained in the applicable Authority Regulatory Agreement
may now
be enforceable not only by Authority and City, but also by each of the persons and/or entities listed in Section
33334.3(f)(7) of the Health and Safety Code, specifically (1)
residents of affordable units
subject to covenants recorded pursuant to Health and Safety Code Section
33334.3(f)(1) (each, a
“Covenanted Unit”), (2)
the most recent
former residents of such a Covenanted Unit, (3)
applicants
that are Very Low Income Households, or Extremely Low Income Households that are denied occupancy of such a Covenanted Unit, and (4)
persons that are Very Low Income Households or
Extremely Low Inc
ome Households and who are on a waiting list for occupancy of such a Covenanted Unit. The provisions of AB 987 are to be applicable only to the extent required by law. Nothing in this Section
8.4 or this Agreement (including the Attachments hereto) is intended to provide an enforcement right to any person or entity not specifically made an intended third party beneficiary of this Agreement; any such third party shall be limited in their right to enforce affordability restrictions to the extent provided by
Health and Safety Code Section
33334.3(f). Neither Authority nor City make
any representation concerning the applicability,
vel non
, of Section
33334.3 as described in the
foregoing portion of this Section 8.4.
8.5 Prohibition on Assignment.
Developer shall not assign any of its rights or obligations under this Agreement or any Project Document without the prior written consent of the Executive Director, which consent may be withheld in the Executive Director’s sole and absolute discretion; pr
ovided that
if Developer elects the Two
-
Phase Project,
the Executive Director shall
permit the
assignment of this Agreement, with respect to
(a) Phase 1
,
to a California limited partnership formed
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in connection with the Closing for Phase 1 where Wakeland controls the general partner (the “Phase 1 Assignee”)
. The Phase 1 Assignee will
be released from and have no
rights
or
obligations under this
Agreement with respect to Phase 2
and the Phase 1 Assignee will not be
responsible
for any rights or
obligations of Developer or the Phase 2 Assignee
;
a default, breach or failure to comply by Developer
or the Phase 2
Assignee
will not be considered a default, breach or failure by the
Phase 1 Assignee
;
and Phase 1 shall not be cross defaulted with Phase 2 and (b) Phase 2, to a California limited partnership formed in connection with the Closing for Phase 2 where Wakeland controls the general partner (the “Phase 2 Assignee”)
. The Phase 2
Assignee
will be release
d
from and
have no
rights or obligations
under this Agreement with respect to Phase 1
and the Phase 2
.
Assignee will not be
responsible for
any rights or obligations of Developer or the Phase 1 Assignee; a default, breach or failure to comply by
Developer or the Phase 1 Assignee will not be considered a default, breach or failure by the Phase 1 Assignee
.
In addition the Authority Executive Director will
,
reasonably consider an assignment to
an entity or entities owned or under majority control by Developer or the Principals where Developer pays Authority’s and City’s costs to review, estimate, process and document such assignment and no other provisions of
this Agreement are amended thereby. Any such assignment without such consent shall
be void. In connection with the foregoing consent requirement, Developer acknowledges that Authority and City relied upon Developer’s particular expertise in entering this Agreement and continues to rely on such expertise to ensure the satisfactory completion of
the Improvements and the
use of the Required Affordable Units in conformity with this Agreement.
8.6 City Option to Acquire . The City shall have an option to acquire from Authority all interest of Authority in the Site, together with any improvements thereon, upon payment of the sum of One Dollar ($1.00), at any time commencing as of the Date of Agreement and continuing througho
ut
the Required Covenant Period. In the event City exercises such option, City shall provide notice thereof to Developer and to Authority. The transfer of the Site, together with any improvements thereon, from Authority to City s
hall not, ipso facto, modify
the rights of Developer under this
Agreement, including without limitation the Ground Lease, and City, as landlord shall not disturb possession by lessee under the
Ground
Lease on account of such transfer to City and lessee shall attorn to City as landlord under the Ground Lease . Accordingly, City is prepared to prepare and execute appropriate documentation evidencing City’s assumption of Authority's obligations under
the
Agreement and
obligations as lessor in the event City assumes the position of lessor under the Ground Lease, in which event City shall have the same rights
and obligations that Authority had under
this
Agreement and
the Ground Lease prior to such assignment.
8.7 Counterparts . Any Project Document may be executed in counterparts, all of which, taken together, shall be deemed to be one and the same document.
8.8 Prior Agreements; Amendments
; Executive Director Authority
; Consents
.
This
Agreement (together with the other
applicable
Project Documents) contains the entire agreement
among City, Authority and Developer with respect to the
Phase 1
Site
and the Phase 2 Site
, and all
prior negotiations, understandings and agreements with respect to such matters are superseded by this Agreement and such other
applicable
Project Documents. No modification of any Project Document (including waivers of rights and conditions)
shall be effective unless in writing and signed by the party or parties against whom enforcement of such modification is sought, and then only in the specific instance and for the specific purpose given.
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This Agreement integrates all of the terms and conditions mentioned herein or incidental hereto and supersedes all negotiations or previous agreements among the parties or their predecessors in interest with respect to all or any part of the subject matter
hereof.
All waivers of the provisions of this Agreement must be in writing by the appropriate authorities of Authority, City and Developer, and all amendments hereto must be in writing by the appropriate authorities of Authority, City and Developer. Whenever this Agreement provides for action by Authority, the Executive Director of
Authority
may act on behalf of Authority unless the
context or applicable law requires otherwise. Whenever this Agreement provides for action by City, the City Manager may act on behal
f of City unless the context or applicable law requires otherwise.
Without limiting the above
or Section 7.13, the Authority Executive Director
and City Manager
may approve changes to this Agreement, and its attachments, provided that such changes
do
not
materially adversely affect the Authority
or increase the Authority Amount
, and may also (as provided
in the Schedule of Performance attached as Attachment No. 3) extend any of the deadlines in such Schedule of Performance provided the extension is in writing
.
The
City Manager and Executive
Director are hereby authorized
to amend this Agreement as needed, to effectuate the purposes of a Two
-
Phase Project, including but not limited to updating the Legal Description
, Schedule of
Performance
,
Scope of Improvements
and Authority Agreement
. The City
M
anager
and
Executive
Director may approve any such proposed changes administratively through appropriate written amendments
.
The Authority Executive Director
may
also make such
commercially
reasonable changes
as may be requested by lenders and investors in connection with the financing for the development and operation of the Improvements.
8.9 Governing Law
. All of the Project Documents shall be governed by, and construed and enforced in accordance with, the laws of the State of California. Developer irrevocably and unconditionally submits to the jurisdiction of the Superior Court of the State of California f
or the
County of San Bernardino in connection with any legal action or proceeding arising out of or relating to this Agreement or the other Project Documents. Assuming proper service of process, Developer also waives any objection regarding personal or in rem jurisdiction or venue.
8.10 Severability of Provisions
. No provision of any Project Document that is held to be unenforceable or invalid shall affect the remaining provisions, and to this end all provisions of the Project Documents are hereby declared to be severable.
8.11 Headings
.
Article and section headings are included in the Project Documents for convenience of reference only and shall not be used in construing the
applicable
Project Documents.
8.12 Conflicts
.
In the event of any conflict between the provisions of this Agreement and those of any other Project Document, this Agreement shall prevail; provided however that, with respect to any matter addressed in both such documents, the fact that one document provides for greater, lesser or different rights or obligations than the other shall not be deemed a conflict unless the applicable provisions are inconsistent and could not be simultaneously enforced or performed.
8.13 Time of the Essence
.
Time is of the essence of all of the Project Documents.
8.14 Conflict of Interest
.
No member, official or employee of Authority shall have any direct or indirect interest in this Agreement, nor participate in any decision relating to the Agreement which is prohibited by law.
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8.15 C ertification . Each of the parties shall at any time and from time to time, but not more frequently than twice during any calendar year, upon not less than twenty (20) days’ prior notice by the other, execute, acknowledge and deliver to such other party a statement in writing certifying that this
Agreement
is unmodified and is in full force and effect (or if there shall have been modifications that this
Agreement
is in full force and effect as modified and stating the modifications), and stating whether or not to the know
ledge of the signer of such certificate such other party is in default in performing or observing any provision of this
Agreement
and, if in default, specifying each such
default of which the signer may have knowledge, and such other matters as such other party may reasonably request, it being intended that any such statement delivered by
Developer
may be relied
upon by City or
Authority or any successor in interest to
City or Authority or any prospective
or
existing
tax credit investor or
mortgagee or enc
umbrancer
of applicable Phase
and it being further
intended that any such statement delivered by Authority
or City may be relied upon by
Developer or
any prospective assignee of
Developer
’
s
interest in this
Agreement
or any prospective
or existing tax
credit investor or mortgagee or encumbrancer
of the applicable Phase.
Reliance on any such certificate
may not extend to any default as to which the signer of the certificate shall have had no actual knowledge
.
8.16 Warranty Against Payment of Consideration
. Developer warrants that it has not
paid or given, and will not pay or give, any third person any money or other consideration for obtaining this Agreement.
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I N WITNESS WHEREOF , the parties hereto have caused this Agreement to be executed on the dates hereinafter respectively set forth.
DEVELOPER:
WAKELAND HIGHLAND LP,
a California limited partnership
By:
WAKELAND HIGHLAND LLC,
a California limited liability company
its managing general partner
By:
WAKELAND HOUSING AND
DEVELOPMENT CORPORATION,
a California nonprofit public benefit corporation,
its sole member/manager
By:
Rebecca Louie
President and Chief Executive Officer
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AUTHORITY:
HIGHLAND HOUSING AUTHORITY,
a public body, corporate and politic
By:
Carlos Zamano , Executive Director
CITY:
CITY OF HIGHLAND,
a municipal corporation
By:
Carlos Zamano, City Manager
APPROVED AS TO FORM:
Maricela Marroquin,
City Attorney and General Counsel to Authority
Attachment No. 1
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ATTACHMENT NO. 1
MAP OF THE
SITE
(Attached; but in the event of any discrepancy between such map and the legal description in Attachment No. 2, the legal description shall govern and prevail.
The parties acknowledge that the
attached preliminary site plans are solely for the purpose of showing diagrams of the Site and shall not constitute final or agreed upon improvement plans. Information on the attached concerning improvement plans, parking, etc. shall be disregarded.)
Attachment No. 1
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Attachment No. 1
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Attachment No. 2
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ATTACHMENT NO. 2
LEGAL DESCRIPTION OF THE
SINGLE PHASE PROJECT
[If the Developer elects the Two-Phase Project, this legal description shall be updated accordingly]
The real property in the City of Highland, County of San Bernardino, State of California, described as follows:
Parcel A:
ALL THAT PORTION OF THE SOUTHWEST ¼ OF THE NORTHWEST ¼ OF THE NORTHEAST ¼ OF SECTION 5, TOWNSHIP 1 SOUTH, RANGE 3 WEST, SAN BERNARDINO
MERIDIAN, IN THE CITY OF HIGHLAND, COUNTY OF SAN BERNARDINO, STATE OF
CALIFORNIA, ACCORDING TO GOVERNMENT SURVEY, DESCRIB
ED AS FOLLOWS:
COMMENCING AT A POINT IN THE WEST LINE OF THE NORTHEAST ¼ OF SECTION 5, WHICH IS SOUTH 0 0 05’ WEST 116.1 FEET FROM THE NORTHWEST ¼ CORNER OF THE SOUTHWEST ¼ OF THE NORTHWEST ¼ OF THE NORTHEAST ¼ OF SAID SECTION 5;
THENCE SOUTH 00 05’ WEST ALONG THE WEST LINE OF SAID NORTHEAST ¼ OF SAID SECTION, 120 FEET;
THEN SOUTH 890 59’ 30” EAST 660.5 FEET, MORE OR LESS, TO THE EAST LINE OF THE SOUTHWEST ¼ OF THE NORTHWEST ¼ OF THE NORTHEAST ¼ OF SAID SECTION;
THENCE NORTH 00 02’ 30” EAST ALONG THE EAST LINE OF THE SOUTHWEST ¼ OF THE NORTHWEST ¼ OF THE NORTHEAST ¼ OF SAID SECTION 120 FEET TO A POINT WHICH IS SOUTH 890 59’ 30” EAST FROM THE POINT OF BEGINNING;
THENCE NORTH 89 0 59’ 30” WEST 660.5 FEET, MORE OR LESS, TO THE POINT OF BEGINNING.
SAVING AND EXCEPTING THEREFROM THE WEST 1 ½ RODS THEREOF INCLUDED IN CENTRAL AVENUE.
APN 1192-431-04-0000
Parcel B:
THAT PORTION OF THE WEST HALF OF THE NORTHWEST ¼ OF THE NORTHEAST ¼ OF SECTION 5, TOWNSHIP 1 SOUTH, RANGE 3 WEST, SAN BERNARDINO MERIDIAN, IN THE
CITY OF HIGHLAND, COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA,
ACCORDING TO THE OFFICIAL PLAT THEREOF, DESCR
IBED AS FOLLOWS:
Attachment No. 2
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COMMENCING AT A POINT ON THE WEST LINE OF THE NORTHEAST ¼ OF SECTION 5, WHICH POINT IS SOUTH 0 0 05’ WEST 236.79 FEET FROM THE NORTHWEST CORNER OF SOUTHWEST ¼ OF THE NORTHWEST ¼ OF THE NORTHEAST ¼ OF SAID SECTION 5, SAID POINT BEING THE SOUTHWEST CORNER OF PARCEL NO. 1 DESCRIBED IN DEED TO A.L.
ABBOTT, ET UX, RECORDED IN BOOK 2193 PAGE 325, OFFICIAL R
ECORDS AND BEING
MARKED BY SURVEYOR’S STAKE L.S. 2345;
THENCE CONTINUING SOUTH 00 05’ WEST 136.14 FEET TO THE NORTH LINE OF PARCEL NO. 2 DESCRIBED IN DEED TO LAWRENCE B. NELSON, ET UX, RECORDED IN BOOK 2656 PAGE 193 OFFICIAL RECORDS;
THENCE EAST ALONG THE NORTH LINE OF THE NELSON PROPERTY TO A POINT IN THE EAST LINE OF THE SOUTHWEST ¼ OF THE NORTHWEST ¼ OF THE NORTHEAST ¼ OF SECTION 5, WHICH POINT IS SOUTH 136.6 FEET FROM THE SOUTHEAST CORNER OF THE A.L. ABBOTT PARCEL ABOVE REFERRED TO
;
THENCE NORTH ALONG THE EAST LINE OF THE SOUTHWEST ¼ OF THE NORTHWEST ¼ OF THE NORTHEAST ¼, 136.6 FEET TO A SURVEYOR’S STAKE L.S. 2345, SAID STAKE MARKING THE SOUTHEAST CORNER OF SAID A.L. ABBOTT PROPERTY;
THENCE NORTH 89 0 59’ 30” WEST 660.5 FEET MORE OR LESS TO THE POINT OF BEGINNING.
EXCEPTING THE WEST 1 ½ RODS THEREOF INCLUDED IN CENTRAL AVENUE.
APN 1192-431-05-0000
Attachment No. 3
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ATTACHMENT NO. 3
SCHEDULE OF PERFORMANCE
FOR SINGLE PHASE PROJECT AND
PHASE 1
OF
TWO
-PHASE PROJECT
Consistent with Section 8.8 of the Agreement (Prior Agreements; Amendments; Consents), the Authority’s Executive Director may approve extensions of deadlines below for cause, provided they are in writing (but is not obligated to do so, and may refer any extension request to the Authority board for a decision).
The following is a summary of selected performance obligations described within the Agreement, however, the body of the Agreement should be referred for the particular terms and conditions pertaining to each action. For convenience of the reader, each act ion item includes a
reference section in the Agreement.
ACTION
SCHEDULE
1. TCAC Approval. Developer shall have obtained a
LIHTC allocation by TCAC of a preliminary
reservation for tax credits for the Phase 1
Improvements (
§ 4.13
).
Not later than the Tax Credit Deadline (June 30,
2027).
2 CDLAC Approval. Developer shall have obtained
an allocation from CDLAC for issuance of private
activity bonds (if bonds are required to finance the
Phase 1
Improvements) (
§ 4.13
).
Not later than June 30, 2027.
3. Opening of Escrow and execution of escrow
instructions (
§ 2.2
)
As soon as is practicable following the approval
and execution of the Agreement by the Parties
4. Escrow Closing; Recording of Documents. All
conditions to the closing shall be satisfied, and the
memorandum of ground lease (and other recordable
documents) shall be recorded (
§ 2.2 et al
).
After all conditions precedent have been met or
waived in writing, but not later than December 30,
2027.
5. Commencement of Construction. Developer shall
have commenced construction of the
Phase 1
Improvements (
§ 4.3
).
Within thirty (30) days after the closing.
6. Completion of Construction. Developer shall
complete construction of the
Phase 1
Improvements
(
§ 4.3
).
Within thirty-six (36) months after the closing.
7. Rental Units Occupied. Developer causes the
Required Affordable Units
(Phase 1) to be occupied
using rents prescribed by and in conformity with
the Agreement or held available for such
occupancy (
§ 3 of
Authority Regulatory
Agreement)
Within nine (9) months after the City’s issuance of
a Certificate of Occupancy.
Attachment No. 4
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SCHEDULE OF PERFORMANCE FOR PHASE 2 OF TWO - PHASE PROJECT Consistent with Section 8.8 of the Agreement (Prior Agreements; Amendments; Consents), the Authority’s Executive Director may approve extensions of deadlines below for cause, provided they are in writing (but is not obligated to do so, and may refer any extension request to the Authority board for a decision).
The following is a summary of selected performance obligations described within the Agreement, however, the body of the Agreement should be referred for the particular terms and conditions pertaining to each action. For convenience of the reader, each act ion item includes a
reference section in the Agreement.
ACTION
SCHEDULE
1. TCAC Approval. Developer shall have obtained a
LIHTC allocation by TCAC of a preliminary
reservation for tax credits for the Phase 1
Improvements (
§ 4.13
).
Not later than the Tax Credit Deadline (June
30, 2032).
2 CDLAC Approval. Developer shall have obtained
an allocation from CDLAC for issuance of private
activity bonds (if bonds are required to finance the
Phase 1
Improvements) (
§ 4.13
).
Not later than June 30, 2032.
3. Opening of Escrow and execution of escrow
instructions (
§ 2.2
)
As soon as is practicable following the
approval and execution of the Agreement by
the Parties
4. Escrow Closing; Recording of Documents. All
conditions to the closing shall be satisfied, and the
memorandum of ground lease (and other recordable
documents) shall be recorded (
§ 2.2 et al
).
After all conditions precedent have been met or
waived in writing, but not later than December
30, 2032.
5. Commencement of Construction. Developer shall
have commenced construction of the
Phase 1
Improvements (
§ 4.3
).
Within thirty (30) days after the closing.
6. Completion of Construction. Developer shall
complete construction of the
Phase 1
Improvements
(
§ 4.3
).
Within thirty-six (36) months after the closing.
7. Rental Units Occupied. Developer causes the
Required Affordable Units
(Phase 1) to be occupied
using rents prescribed by and in conformity with
the Agreement or held available for such
occupancy (
§ 3 of
Regulatory Agreement)
Within nine (9) months after the City's issuance
of a Certificate of Occupancy.
Attachment No. 4
Page
2 of 2
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ATTACHMENT NO. 4
[INTENTIONALLY OMITTED]
Attachment No. 5
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ATTACHMENT NO. 5
NOTICE OF AFFORDABILITY RESTRICTIONS
[In any reasonable statutory form;
to come
from Authority legal counsel after date of Agreement.]
Attachment No. 6
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ATTACHMENT NO. 6
GROUND LEASE
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3513814.1
GROUND LEASE
by and between
HIGHLAND HOUSING AUTHORITY
“AUTHORITY/LESSOR”
and
WAKELAND HIGHLAND LP
,
a California limited partnership
“LESSEE”
TABLE OF CONTENTS
Page
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1. SUBJECT OF LEASE; DEFINITIONS. ................................................................................... 1
1.1 Definitions. .......................................................................................................................... 1
2. LEASE OF SITE ; AUTHORITY TERMINATION RIGHT . ................................................... 6
3. LEASE TERM. .......................................................................................................................... 6
4. USE OF PROPERTY. ............................................................................................................... 7
4.1 Use of Property ; Compliance with Regulatory Agreements ............................................... 7
4.2 Management. ....................................................................................................................... 7
4.3 Only Lawful Uses Permitted. .............................................................................................. 7
5. RENT. ........................................................................................................................................ 7
5.1 Rent………………………………………………………………………………………. .7
5.2 Net Lease. .................................................................................................................................. 7
5.3 Payment of Rent. ....................................................................................................................... 7
6. AFFORDABLE HOUSING REQUIREMENTS. ..................................................................... 7
6.1 Required Affordable Units. ................................................................................................. 7
7. UTILITIES AND TAXES. ........................................................................................................ 8
7.1 Utilities. ............................................................................................................................... 8
7.2 Real Estate Taxes. ............................................................................................................... 8
7.3 Personal Property. ............................................................................................................... 9
7.4 Lessee Payment of Real Estate and Other Property Taxes . ................................................ 8
7.5 Ownership During Term
..................................................................................................... 8 7.6
Ownership at Termination
................................................................................................... 9 8. MECHANICS LIENS ............................................................................................................... 9
9. MANTENANCE AND REPAIR; RESERVES ........................................................................ 9
10. ENVIRONMENTAL MATTERS. .......................................................................................... 10
10.1 Definitions. ................................................................................................................... 10
10.2 Site Evaluation. ............................................................................................................. 11
10.3 Indemnification; Lessee’s Indemnity. .......................................................................... 11
10.4 Duty to Prevent Hazardous Material Contamination. .................................................. 12
10.5 Obligation of Lessee to Remediate Premises. .............................................................. 12
10.6 Storage or Han dling of Hazardous Materials. .............................................................. 13
10.7 Environmental Inquiries. .............................................................................................. 12
11. ALTERATION OF IMPROVEMENTS. ................................................................................ 13
12. DAMAGE OR DESTRUCTION. ........................................................................................... 15
13. SALE, ASSIGNMENT, SUBLEASE OR OTHER TRANSFER. .......................................... 14
14. TRIPLE NET LEASE; DISCLAIMER . .................................................................................. 15
15. INSURANCE. ......................................................................................................................... 15
15.1 Insurance to be Provided by Lessee. ............................................................................ 15
15.2 Definition of “Full Insurable Value. ............................................................................. 16
15.3 General Insurance Provisions. ...................................................................................... 17
15.4 Failure to Maintain Insurance Maintenance ................................................................. 17
15.5 Insurance Proceeds Resulting from Loss or Damage to Site Improvements. ............... 17
16. EMINENT DOMAIN. ............................................................................................................. 18
17. OBLIGATION TO REFRAIN FROM DISCRIMINATION. ................................................ 19
18. NONDISCRIMINATION IN EMPLOYMENT. .................................................................... 20
19. [INTENTIONALLY OMITTED]. .......................................................................................... 20
20. COMPLIANCE WITH LAW. ................................................................................................. 20
21. ENTRY AND INSPECTION. ................................................................................................. 21
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22. RIGHT TO MAINTAIN. ........................................................................................................ 21
23. EVENTS OF DEFAULT AND REMEDIES. ......................................................................... 21
23.1 Events of Default by Lessee. ........................................................................................ 21
23.2 Remedies of Authority. ................................................................................................ 22
23.3 Right of Authority in the Event of Termination of Lease. ........................................... 22
23.4 Damages. ...................................................................................................................... 23
23.5 Rights and Remedies are Cumulative. .......................................................................... 23
24. MISCELLANEOUS. ............................................................................................................... 23
24.1 Governing Law; Interpretation. .................................................................................... 23
24.2 Legal Actions. ............................................................................................................... 23
24.3 Acceptance of Service of Process. ................................................................................ 23
24.4 Attorneys’ Fees And Court Costs. ................................................................................ 23
24.5 Financial Statement; Inspection of Books And Records. ............................................. 24
24.6 Interest. ......................................................................................................................... 24
24.7 Notices. ; Cure by Limited Partners .............................................................................. 24
24.8 Time is of the Essence. ................................................................................................. 25
24.9 Non- Merger of Fee and Leasehold Estates. .................................................................. 25
24.10 Holding Over. ............................................................................................................... 25
24.11 Conflict of Interest. ....................................................................................................... 25
24.12 Non-Liability of Authority Officials And Employees. ................................................. 27
24.13 Relationship. ................................................................................................................. 25
24.14 Waivers And Amendments. .......................................................................................... 25
24.15 Non- Merger With AHA. .............................................................................................. 26
24.16 Entire Agreement; Counterparts. .................................................................................. 26
24.17 Severability. .................................................................................................................. 26
24.18 Recordation. .................................................................................................................. 26
24.19 Binding Effect. ............................................................................................................. 26
24.20 Estoppel Certificates. .................................................................................................... 26
24.21 Force Majeure. .............................................................................................................. 27
24.22 Quiet Enjoyment. .......................................................................................................... 27
24.23 Authority Approvals and Action..…………………………
…………………..……
…2
7 24.24 No Third Parties Benefited Except for City and Approved L easehold Mortgagee;
City
Option to Acquire Interest of Authority.
.............................................................. 27 24.25 Lessee’s Limited Partners………………………………………...........................27
EXHIBITS
Exhibit
A
Map of the Site
Exhibit
B
Legal Description of the Site
Exhibit
C
Memorandum of Lease
Exhibit
D
Ground Lease Rider
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GROUND LEASE
(PHASE 1 – ALTERNATIVE PROVISIONS FOR THE SINGLE PHASE PROJECT AND THE FIRST PHASE OF THE TWO PHASE PROJECT ARE NOTED IN BRACKETS. IF DEVELOPER ELECTS
THE TWO
-
PHASE PROJECT, THIS FORM WILL BE ALSO USED FOR PHASE 2 AS REVISED TO
REFLECT
THE MUTUALLY AGREED
PROJECT PROGRAM FOR PHASE 2
)
This GROUND LEASE (the “Lease”) is made as of ________ __, 202 ____ by and between the
HIGHLAND HOUSING AUTHORITY
, a public body, corporate and politic (the “Authority” or “Lessor”), and
[
WAKELAND HIGHLAND LP
, a California limited partnership]
(“Lessee”).
1. SUBJECT OF LEASE; DEFINITIONS.
This Lease is executed and delivered pursuant to that certain Second Amended and Restated Disposition and Development/Affordable Housing Agreement dated as of March 10, 2026
, (the
“AHA”).
Except as may otherwise be expressly set forth in this Lease, all capitalized terms shall have the same meanings as set forth in the AHA.
1.1 Definitions
.
“AHA”
or “
Agreement”
, as set forth in the Recitals above, means the
Amended and Restated
Disposition and Development/Affordable Housing Agreement by and among Authority, City and Lessee, dated as of
March 10, 2026
.
“Approved Construction and/or Permanent Lender”
means one or more of Bank of America,
California Community Reinvestment Corporation (“CCRC”), East West Bank, Union Bank, U.S.
Bank, Wells Fargo Bank, or Citibank, JP Morgan Chase, Wells Fargo, HCD or another mutually acceptable institutional lender or governmental lender, subject to compliance with the terms and conditions of this Lease.
“Authority”
means the Highland Housing Authority, a public body, corporate and politic, exercising governmental functions and powers and organized and existing under the Housing Authorities Law, and any assignee of or successor to its rights, powers and responsibilit ies.
“Authority Executive Director”
or
“Executive Director”
means the Executive Director of
Authority or his or her designee.
“Base Period”
means a period of sixty eight (68) years, commencing as of the Commencement Date of this Lease.
“
Bond Regulatory Agreement”
means the regulatory agreement which it is contemplated may be required to be recorded against the Site with respect to the issuance of multifamily housing bonds in the event an allocation is obtained from CDLAC
.
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“Bond Rules” means Section 103(b) of the Internal Revenue Code, the rules and regulations applied by CDLAC in connection with the private activity bond allocation or the issuance of bonds thereunder and as set forth in the Indenture of Trust in connection with the iss uance of the Bonds.
“Bonds”
means multi
-
family housing bonds as described in the AHA in connection with the Improvements, if any.
“Capital Replacement Reserve”
means a reserve fund to be established by Lessee under this Lease as a capital reserve in the amount
required
by any Approved Construction and/or Permanent
Lender
.
“City”
means the City of Highland, California, a California municipal corporation. “Closing”
means the day on which a memorandum of lease for this Lease
is recorded
at the
Closing under the AHA).
“Commencement”
means the commencement of this Lease
(which shall
occur as of the
Closing).
“Commencement Date”
means the date on which the Closing occurs.
“County”
means the County of San Bernardino, California.
“County Housing Authority”
means the Housing Authority of the County of San Bernardino. “Date of Agreement”
means
March 10
,
2026.
“Default”
means the failure of a party to perform any action or covenant required by this Lease within the time periods provided herein following any applicable notice and opportunity to cure period, as may be set forth herein.
“Developer”
, for purposes of this Lease, means Wakeland Highland LP, a Califo
rnia limited
partnership.
“Developer Fee”
has the meaning set forth therefor in the AHA.
“Development”
for purpose of this Lease, means the new apartment complex including associated improvements as required by the AHA on the Site to be: (i)
constructed by Lessee upon the
Site, with related offsite improvements, as more particularly described in the Scope
of Development
and (ii) operated as an affordable housing complex in conformity with this Lease .
“Environmental Laws”
means all laws, ordinances and regulations relating to Hazardous Materials, including, without limitation: the Clean Air Act, as amended, 42 U.S.C. Section 7401, et
seq
.; the Federal Water Pollution Control Act, as amended, 33 U.S.C. Section 1251
et seq
.; the
Resource Conservation and Recovery Act of 1976, as amended, 42 U.S.C. Section 6901,
et seq
.; the
Comprehensive Environment Response, Compensation and Liability Act of 1980, as amended (including the Superfund Amendments and Reauthorization Act of 1986, “CERCLA”), 42 U.S.C.
Section 9601,
et seq
.; the Toxic Substances Control Act, as amended, 15 U.S.C. Section 2601
et seq
.;
the Occupational Safety and Health Act, as amended, 29 U.S.C. Section 651, the Emergency Planning and Community Right to Know Act of 1986, 42 U.S.C. Section 11001
et seq
.; the Mine Safety and
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Health Act of 1977, as amended, 30 U.S.C. Section 801 et seq .; the Safe Drinking Water Act, as amended, 42 U.S.C. Section 300f
et seq
.; all comparable state and local laws, laws of other jurisdictions or orders and regulations; and all laws, ordinances, statutes, codes, rules, regulations, orders and decrees of the United States, the State, the County, City, or any other political subdi vision in which the
Site is located, and of any other political subdivision, agency or instrumentality exercising jurisdict ion
over Authority, Lessee, or the Site.
“Governmental Requirements”
means all laws, ordinances, statutes, codes, rules, regulations, orders, and decrees of the United States, the state, the County, City, or any other political subdivision in which the Site is located, and of any other political subdivision, Authority, or
instrumentality
exercising jurisdiction over Lessee or the S
ite, including the Regulatory Agreement (Density Bonus) between the Developer and the City.
“
Ground Lease Rider
” means
Exhibit
“
D
”
to this Lease.
“ Hazardous Material ” or “ Hazardous Materials ” means and include any substance, material, or waste which is or becomes regulated by any local governmental authority, including the County, the Regional Water Quality Control Board, the State of California, or the United States Government, including, bu
t not limited to, any material or substance which is: (i)
defined as a “hazardous waste,”
“acutely hazardous waste,” “restricted hazardous waste,” or “extremely 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); (ii)
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); (iii)
defined as a “hazardous material,”
“hazardous substance,” or “hazardous waste” under Section 25501 of the California Health and Safety Code, Division 20, Chapter 6.95 (Hazardous Materials Release Response Plans and Inventory); (iv)
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); (v)
petroleum; (vi)
asbestos
and/
or asbestos containing materials; (vii)
lead based paint or any lead based or lead products;
(viii)
polychlorinated biphenyls, (ix)
designated as a “hazardous substance” pursuant to Section 311 of the Clean Water Act (33 U.S.C. Section 1317); (x)
defined a
s a “hazardous waste” pursuant to Section
1004 of the Resource Conservation and Recovery Act, 42
U.S.C. Section 6901,
et seq
. (42 U.S.C.
Section 6903); (xi)
Methyl tertiary Butyl Ether; (xii)
defined as “hazardous substances” pursuant to
Section 101 of the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. Section 9601,
et seq
. (42 U.S.C. Section 9601); (xiii) any other substance, whether in the form of a solid, liquid, gas or any other form whatsoever, which by any “Government al Requirements” (as
defined in this Lease) either requires special handling in its use, transportation, generation, collection, storage, handling, treatment or disposal, or is defined as “hazardous” or harmful to the environment; and/or (xiv)
lead based p
aint pursuant to and defined in the Lead Based Paint Poisoning Prevention Act, Title X of the 1992 Housing and Community Development Act, 42 U.S.C. § 4800,
et seq
.,
specifically §§ 4821
–
4846, and the implementing regulations thereto. Notwithstanding the f
oregoing,
“Hazardous Materials” shall not include such products in quantities below attainment levels identified in one or more of the enactments identified above as Governmental Requirements, including those product and amounts as are customarily used in the construction, maintenance, rehabilitation, management, operation and residence of residential developments or associated buildings and grounds, or typically used in residential activities in a manner typical of other comparable residential developments
, or substances commonly ingested by a significant population living within the Development, including without limitation alcohol, aspirin, tobacco and saccharine.
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“HCD” means the Housing and Community Development Department of the State of California.
“Housing Authorities Law”
means Chapter 1 of Part 2 of Division 24 of the California Health and Safety Code.
“Units”
means the
[ninety (90)][
sixty (60
)]
individual apartment units within the Development
to be constructed and operated by Lessee on the Site, as provided in the AHA and in the Scope of Development, but excluding therefrom one additional unit which Lessee may develop and make available to an o
n-
site manager.
T
he
Authority Regulatory Agreement restrict
s
49% of the
U
nits
available for leasing (
i.e.
,[44][ 29]
of the Units) at Affordable Rent (as defined therein).
“HUD” means the United States Department of Housing and Urban Development or its successor(s).
“Improvements”
means all of the improvements to be made to the Site and including such offsite improvements and/or other matters as may be required by City as conditions of development for those improvements alluded to in the AHA.
“Lease”
means this Ground Lease, which is referred to in the AHA as the “Lease.”
“Lease Year”
means the period commencing as of Commencement Date and ending as of December
31 of that calendar year, then each calendar year thereafter; provided that the final Lease Year will be a portion of a calendar year ending on December
31 of the corresponding
calendar year;
provided that the final Lease Year may be a portion of a calendar year. “Legal Description of the Site”
means the description of the Site which is attached hereto as Exhibit
“B”
.
“Map of the Site” means the Map of the Site which is attached hereto as Exhibit “A” and incorporated herein.
“Memorandum of Lease”
means
Exhibit
“C”
to this Lease.
“Notice” means a notice in the form prescribed by Section 8.2 of the AHA. “Other Assistance Requirements”
means laws, regulations and conditions related to financial assistance, if any, as Developer or Lessee may obtain in connection with the development and/or operation of the Site.
“Partnership Agreement”
has the meaning set forth therefor in Section 24.25
of this Lease.
“Person”
means an individual, estate, trust, partnership, corporation, limited liability company, limited liability partnership, governmental department or Authority or any other entity which has the legal capacity to own property.
“Prescribed Income Levels”
means
:
means,
[
if Developer elects the Single Phase Project:
for
the
forty-
four (
44)
Required Affordable Units: (i) for twenty
-
three (23) one bedroom units and four (4)
two
-
bedroom units (twenty
-
seven (27) units total),
a
thirty percent (30%)
Income Household as
published by TCAC for the County (i.e., Extremely Low Income Households); and (ii) for four (4) two
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bedroom units and thirteen (13) one bedroom units (seventeen (17) units total), a fifty percent (50%) of Income
Households
as published by TCAC for the County
(
i.e.
,
Very L
ow
I
ncome
H
ouseholds)
.
[
If
Developer elects the Two - Phase Project: for the twenty - nine ( 29 ) Required Affordable Units: four (4) one bedroom units and two (2) two-bedroom units (6 total),
a
thirty percent (30%) Income Household
as published by TCAC for the County
(i.e., Extremely Low Income Households); ten (10) one bedroom units and thre
e (3) two bedroom units (13 total), a
fifty percent (50%)
Income
Households
as published
by TCAC for the County
(
i.e.
,
Very L
ow
Income
H
ouseholds);
and two (2) one bedroom units and
eight (8) two bedroom units (10 total) , a sixty percent (60%) come Households as published by TCAC for the County (
i.e.
, L
ow I
ncome
H
ouseholds).]
“Primary Construction Loan” means the mortgage loans for the Project obtained by Developer or Lessee from a state or local government or instrumentality or a reputable and established bank, savings and loan association, or other similar financial institution for financing the Improvements (but not the operation) of the Project pursuant to the AHA, and reimbursement obligations to approved lenders securing credit enhancement facilities.
“Primary Permanent Loan”
means one or more mortgage loans relating to the Project obtained by Developer or Lessee from a state or local government or instrumentality or the Approved Construction and/or Permanent Lender in an amount limited to satisfaction of the outstanding balan
ce
of the Primary Construction Loan.
“Principals”
means Wakeland.
“Project”,
for purposes of this Lease, means the residential rental housing development located on the Site and the remainder of the Improvements. “Property”
means the leasehold interest in the Site provided to Lessee by this Lease.
“Property Manager”
means
ConAm Management Corporation (3990 Ruffin Road, Suite 100, San Diego CA 82123)
(or other property manager approved
in writing
by the
Executive Director of
the
Authority)
, which shall be responsible for the management and operation of the Project
on behalf
of Lessee
, or another property manager approved in writing by Authority. “
Authority
Regulatory Agreement ”
means the
Authority
Regulatory Agreement
with the
Authority which is to be recorded against the Site in accordance the AHA, in the form of Attachment No. 11 to the AHA.
“Regulatory Agreement (Density Bonus)”
means the Regulatory Agreement (Density Bonus)
with the City which is to be recorded against the Site in accordance with the AHA, in the form of Attachment No.
13 to the AHA.
“Related Entity”
means Wakeland
.
“Rent”
is defined in Section 5 of this Lease.
“Required Affordable Units”
means
[44][
29]
of the dwelling units required to be developed
on the Site that are required by this Lease and the
Authority
Regulatory Agreement to be maintained
in conformity with the Prescribed Income Levels at Affordable Rents .
“Required Covenant Period”
means the Base Period
.
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“Schedule of Performance” means Attachment No. 3 to the AHA. “Scope of Development”
means that certain Scope of Development attached to the AHA as Attachment No.
9. The Scope of Development is subject to revision only as provided in the AHA.
“
Senior Citizen Household
” means a household that is lawful senior housing under fair housing laws
and California Civil Code Section 51.3 (with which Lessee shall comply).
“Senior Citizen Unit”
means all of the units, except for the manager’s un
it
.
“Site”
means the land described in
Exhibit “A”
.
“Site Improvements” means those Improvements which are made to the Site. “Tax Credit Rules”
means Section
42 of the Internal Revenue Code and/or California Revenue and Taxation Code Sections
17057.5, 17058, 23610.4 and 23610.5 and California Health and Safety Code Section 50199,
et seq
., and the rules and regulations implementing the foregoing.
“Tax Credits”
means 4% Low Income Tax Credits granted pursuant to Section
42 of the
Internal Revenue Code and/or California Revenue and Taxation Code Sections
17057.5, 17058,
23610.4 and 23610.5 and California Health and Safety Code Section
50199,
et seq
. or 9% Housing
Tax Credits granted
pursuant
to Section 42 of the Internal Revenue Code and related California law
“TCAC”
means the Tax Credit Allocation Committee of the State of California. “Term”
or “
Term of the Lease”
means the Base Period
.
“Unit”
means each of the
dwelling units required to be developed by Lessee under the AHA and this Lease on the Site.
“Wakeland” or “Developer Parent”
means Wakeland Housing and Development
Corporation, a California nonprofit public benefit corporation.
“Year”
means a fiscal year beginning as of July
1 and ending June
30 of the following calendar
year or such other annual period as may be mutually agreed to by Authority and Lessee.
2. LEASE OF SITE
; AUTHORITY TERMINATION RIGHT
.
If the Executive Director of Authority shall have approved in writing the closing under the AHA without the satisfaction of the condition that Lessee have closed all financing necessary to complete the Project, such that the closing occurs (and a Memorandu
m of Lease for this Lease is
recorded) prior to the closing of such financing, then in the event that such financing does not close within twenty (20) calendar days after the date of such closing/recording, the Executive Director shall have the right, in his or her sole and absolute discretion (and in that regard, Lessee hereby waives the implied covenant of good faith and fair dealing), to terminate this Lease by written notice to Developer.
Upon any such termination, Developer shall promptly execute and deliver to Authority (for execution by Authority and recording), duly acknowledged, a counterpart of a termination of the Memorandum o
f Lease, in the form provided by Authority to Lessee, and Lessee’s obligations to do so shall survive the termination of th
is Lease.
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Authority, for and in consideration of the rents, covenants, and agreements hereinafter reserved and contained on the part of Lessee to be paid, kept, performed and observed by Lessee, hereby leases to Lessee, and Lessee hereby leases from Authority, that certain real property in the City shown on the “Map of the Site” attached hereto as
Exhibit
“A”
, and having the legal description in the Legal
Description of the Site attached hereto as Exhibit “B” . Except as expressly provided to the contrary in this Lea se, reference to the Site is to the described land, exclusive of any improvements now or hereafter located on the land, notwithstanding that any such improvements may or shall be construed as affixed to and as constituting part of the real property.
3. LEASE TERM.
Lessee shall lease the Site from Authority and Authority shall lease the Site to Lessee for a term commencing on the Commencement Date and for the Base Period (the “Term”), unless sooner terminated as provided for herein.
4. USE OF PROPERTY.
4.1 Use of Property; Compliance with Regulatory Agreements . Lessee shall, by the
respective times established therefor in the Schedule of Performance (in the AHA), commence and complete the Improvements in conformance with the requirements of the AHA and all applicable laws, and thereafter the Property and the improvements thereon shall be devoted to those uses permitted by this Lease, the
Authority
Regulatory Agreement
and the Regulatory Agreement (Density Bonus).
Lessee shall comply with the
Authority
Regulatory Agreement and the Regulatory Agreement
(Density Bonus).
4.2 Management
. Lessee shall manage or cause the Property and the Site improvements to be managed in conformity with, and shall otherwise comply with, the
Authority
Regulatory
Agreement
and the Regulatory Agreement (Density Bonus).
[For Phase 2, a separate Authority
Regulatory
Agreement
and Regulatory Agreement (Density Bonus) will be entered into if the parties are able to agree on the terms of a density bonus].
4.3 Only Lawful Uses Permitted
. Lessee shall not use the Site or the improvements
thereon for any purpose that is in violation of any law, ordinance or regulation of any federal, state, county or local governmental Authority, body or entity. Furthermore, Lessee shall not maintain or com
mit any nuisance or unlawful conduct (as now or hereafter defined by any applicable statutory or decisional law) on the Site or the improvements thereon, or any part thereof.
5. RENT.
5.1 Rent
.
During each Lease Year during the Term, Lessee agrees to pay the “Rent.” The term “Rent” means the Rent, which is One Dollar ($1.00) per Lease Year. The Base Rent shall be paid on the Commencement Date and on the first day of each subsequent Lease Year.
5.2 Net Lease
. It is the intent of the parties hereto that the rent provided herein shall be absolutely net to Authority and that Lessee shall pay all costs, taxes, charges, and expenses of every kind and nature against the Site or the improvements thereon which may aris e or become due during
the Term, and which, except for execution hereof, would or could have been payable by Authority.
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5.3 Payment of Rent . All rent that becomes due and payable pursuant to this Lease shall be paid to Authority at the address of Authority listed in Section
24.7 of this Lease or such other place
as Authority may from time to time designate by written notice to Lessee without no tice or demand,
and without setoff, counterclaim, abatement, deferment, suspension or deduction.
6. AFFORDABLE HOUSING REQUIREMENTS.
6.1 Required Affordable
Units.
Lessee agrees to
construct the Development in
accordance with the AHA, and make available, restrict occupancy to, and rent
[44][
29 ]
units (the
“Required Affordable Units”) of the
[90][60]
Units at an Affordable Rent as required by the
Authority
Regulatory Agreement and the Regulatory Agreement (Density Bonus), and shall otherwise comply with the AHA and such Regulatory Agreemen
t(s)
.
However, i
f
the Bond Regulatory Agreement
or
any other recorded agreement imposes stricter rent requirements, it shall control for so long as it remains in effect.
Lessee acknowledges that Authority uses the Certificate of Continuing Program Compliance
required by the
Authority
Regulatory
Agreement
,
to comply with its own reporting requirements, and
to monitor Lessee’s compliance with the
Authority
Regulatory Agreement and time is of the essence
with respect to the delivery by Lessee of such annual Certificate as required by the
Authority
Regulatory Agreement .
7. UTILITIES AND TAXES.
7.1 Utilities
. Lessee shall pay or cause to be paid all common area charges for gas, electricity, water, sewer, garbage collection, and other utilities furnished to the Site and the improvements thereon and all sewer use charges, hookup or similar charges or assessments
for utilities
levied against the Site and the improvements thereon for any period included within the Term.
7.2 Real Estate Taxes
.
(a)
As used herein, the term “real estate taxes” means all real estate taxes, municipal or county water and sewer rates and charges, or any other assessments or taxes, which shall be levied against the Site and the improvements thereon, or any interest therein, and which become a lien thereon and accrue during the Term
, including possessory interest taxes
.
(b)
Any real estate taxes which are payable by Lessee hereunder shall be prorated between Authority and Lessee as of the Commencement Date and then again at the expiration or earlier termination of the Term.
(c)
Lessee shall have the right to contest the amount or validity of any real estate taxes, in whole or in part, by appropriate administrative and legal proceedings, without any costs or expense to Authority, and Lessee may postpone payment of any such contest ed real estate taxes
pending the prosecution of such proceedings and any appeals so long as such proceedings shall not operate to prevent the collection of such real estate taxes and the sale of the Site and any improvements thereon to satisfy any lien ari
sing out of the nonpayment of the same.
(d)
Lessee shall have the right to apply for and may obtain any exemption(s) as may be applicable as to real estate taxes
, including possessory interest taxes
.
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7.3 Personal Property . Lessee covenants and agrees to pay before delinquency all personal property taxes, assessments and liens of every kind and nature upon all personalty as may be owned by Lessee and from time to time situated within the Site and any Site Improvements.
7.4 Lessee Payment of Real Estate and Other Property Taxes .
Lessee shall pay all
possessory interest taxes assessed on its interest under this Lease, but may apply for an exemption.
Pursuant to Health and Safety Code Section
33673, to the extent applicable, the Site is to be assessed and taxed in the same manner as
privately owned property, and Lessee shall pay taxes upon the entire property and not merely the assessed value of its leasehold interest. Lessee shall pay or cause to be paid, before any fine, penalty, interest or cost may be added thereto for the nonpayment thereof, all real estate
taxes which may be levied against any and all interests in the Site and any Site Improveme nts
during the Term; provided, however, that Lessee may apply for and receive any applicable exemption from the payment of property taxes and assessments. Authority acknowledges and does not object that Developer intends to seek exemptions from property taxes to the extent provided by state law.
7.5 Ownership During Term
. All improvements constructed on the Site by Lessee as provided in the AHA and as permitted by this Lease shall, during the Term, be and remain the property of Lessee; provided, however, that Lessee shall have no right to cause or permit
waste
as to
the Site
Improvements, or to destroy, demolish or remove the Site Improvements except as otherwise permitted pursuant to this Lease; and provided further that Lessee’s rights and powers with respect to the Site Improvements are subject to the terms and lim
itation
s of this Lease. Authority and Lessee covenant
for themselves and all persons claiming under or through them that any improvements to the Site are real property.
7.6 Ownership at Termination
. Upon the expiration or earlier termination of this Lease, all improvements to the Site, fixtures and furnishings shall, without compensation to Lessee, then become Authority’s property, free and clear of all liens, encumbrances, and claims to or against th
em
by Lessee or any third person, firm or entity, including but not limited to any mortgagee or lender, unless otherwise approved by Authority in writing at its discretion. At the option of Authority, Authority may require Lessee to demolish and remove any improvements to the Site which have not previously been approved by Authority.
8. MECHANICS LIENS
.
Lessee shall not suffer or permit any mechanics’ or materialmen’s liens to be enforced against the fee simple estate in reversion of Authority as to the Site and the improvements thereon, nor against Lessee’s leasehold interest therein by reason of work, l abor, services or materials supplied or claimed
to have been supplied to Lessee or anyone holding the Site and the improvements thereto, or any part thereof, through or under Lessee, and Lessee agrees to defend, indemnify, and hold Authority and City and t
heir respective officers, officials, employees, agents, and representatives, harmless against such liens. If any such lien shall at any time be filed against the Site or any improvements thereon, Lessee shall, within thirty (30) days after notice to Lesse
e of the filing thereof, cause the same to be discharged of record; provided, however, that Lessee shall have the right to contest the amount or validity, in whole or in part, of any such lien by appropriate proceedings but in such event, Lessee shall noti fy
Authority and promptly bond such lien in the manner authorized by law with a responsible surety company qualified to do business in the State of California or provide other security acceptable to Authority. Lessee shall prosecute such proceedings with due diligence. Nothing in this Lease shall be deemed to be, nor shall be construed in any way to constitute, the consent or request of Authority, express or implied, by inference or otherwise, to any person, firm or limited partnership for the
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performance of any labor or the furnishing of any materials for any construction, rebuilding, alteration or repair of or to the Site, improvements to the Site thereto, or any part thereof. Prior to commencement of construction of any improvements on Site,
or any repair or alteration thereto having a cost in excess of Ten Thousand Dollars ($10,000), Lessee shall give Authority not less than thirty (30) days advance notice in writing of intention to begin said activity in order that non
-
responsibility notice
s may be
posted and recorded as provided by State and local laws.
9. MAINTENANCE AND REPAIR; RESERVE
S
.
Lessee
shall maintain all reserves required by any holder of a deed of trust on the Site or Improvements under the documents evidencing or relating to the obligation(s) secured by such deed of trust.
Lessee shall
manage, operat
e
and maint
ain
the Site
and
the improvements thereon throughout
the Term without expense to Authority, and to perform all repairs and replacements necessary to maintain and preserve the Site
and the improvements thereon in good repair, in a neat, clean, safe and orderly condition rea
sonably satisfactory to Authority and in compliance with all applicable laws .
Lessee agrees that Authority shall not be required to perform any maintenance, repairs or services or to assume any expense in connection with the Site including the improvements thereon. Lessee hereby waives all rights to make repairs or to cause any w
ork to be performed at the expense of Authority as
provided for in Section 1941 and 1942 of the California Civil Code.
10. ENVIRONMENTAL MATTERS.
10.1 Definitions
. For the purposes of this Lease, unless the context otherwise specifies or requires the following terms shall have the meanings herein specified:
(a)
The term “Hazardous Material” or “Hazardous Materials” means and include any substance, material, or waste which is or becomes regulated by any local governmental authority, including the County, the Regional Water Quality Control Board, the State of California, or the United States Government, including, but not limited to, any material or substance which is: (i)
defined as a
“hazardous waste,” “acutely hazardous waste,” “restricted hazardous waste,” or “extremely hazardous waste” under Sections 25115, 25
117 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); (ii) 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); (iii) defined as a “hazardous material,” “hazardous substance,” or “hazardous waste” under Section 25501 of the California Health and Safety Code, Division 20, Chapter 6.95 ( Hazardous Materials Release Response
Plans and Inventory); (iv) 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); (v) petroleum; (vi) asbestos and/or asbestos containing materials; (vii) lead based paint or any lead based or lead products; (viii) polychlorinated biphenyls, (ix)
designated as a “hazardous substance”
pursuant to Section 311 of the Clean Water Act (33
U.S.C. Section 1317); (x)
defined as a “hazardous
waste” pursuant to Section 1004 of the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901,
et seq
. (42 U.S.C. Section 6903); (xi)
Methyl tertiary Butyl Ether; (xii) defined as “hazardous substances” pursuant to Section 101 of the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. Section 9601,
et seq
. (42 U.S.C. Section 9601); (xiii) any other substance, whether in the form of a solid, liquid, gas or any other form whatsoever, which by any “ Governmental
Requirements” (as defined in this Lease either requires special handling in its use, transportation, generation, collection, storage, handling, treatment or disposal, or is defined as “hazardous” or harmful to the environment; and/or (xiv) lea
d based paint pursuant to and defined in the Lead Based Paint
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Poisoning Prevention Act, Title X of the 1992 Housing and Community Development Act, 42 U.S.C. § 4800,
et seq
., specifically §§ 4821
–
4846, and the implementing regulations thereto. Notwithstanding the foregoing, “Hazardous Materials” shall not include such products in quantities below attainment levels identified in one or more of the enactments identified above
as Governmental Requirements,
including those product and amounts as are customarily used in the construction, maintenance, rehabilitation, manage
ment, operation and residence of residential developments or associated buildings and grounds, or typically used in residential activities in a manner typical of other comparable residential developments, or substances commonly ingested by a significant population living within the Development, including without limitation alcohol, aspirin, tobacco and saccharine. (b)
The term “Hazardous Materials Contamination” means the contamination (whether presently existing or hereafter occurring) of the improvements, facilities, soil, groundwater, air or other elements on, in, or under the Site by Hazardous Materials, or the cont amination of the
buildings, facilities, soil, groundwater, air or other elements on, in or of any other property as a result of Hazardous Materials at any time (whether before or after the Date of Agreement) emanating from the Site.
(c)
The term “Governmental Requirements” means all past, present and future laws, ordinances, statutes, codes, rules, regulations, orders and decrees of the United States, the state, the county, the city, or any other political subdivision in which the Site is located, and any other state,
county city, political subdivision, authority, instrumentality or other entity exercising jurisdiction over Authority, Lessee or the Site.
10.2 Site Evaluation
.
Lessee assumes any and all responsibility and Liabilities (as defined in Section
10.3 of this Lease) for all Hazardous Materials Contamination of the Site.
10.3 Indemnification; Lessee’s Indemnity
. Lessee shall save, protect, pay for, defend
(with counsel acceptable to each of Authority and City), indemnify and hold harmless each of Authority, City, and their respective elected and appointed officials, officers, employees, attorneys, representatives,
volunteers, contractors and agents (collectively, “Indemnitees”) from and against any and all liabilities, suits, actions, claims, demands, penalties, damages (including, without limitation, penalties, fines and monetary sanctions), losses, costs or expen
ses (including, without limitation,
consultants’ fees, investigation and laboratory fees, attorneys’ fees and remedial and response costs and third
-
party claims or costs) (the foregoing are hereinafter collectively referred to as “Liabilities”) that may no
w or in the future be incurred or suffered by Indemnitees by reason of, resulting from, in connection with or arising in any manner whatsoever as a direct or indirect result of: (i)
the presence,
use, release, escape, seepage, leakage, spillage, emission,
generation, discharge, storage, or disposal of
any Hazardous Materials in, on, under, or about, or the transportation of any such Hazardous Materials to or from, the Site occurring during the Term or caused or contributed to by Developer
; (ii)
the
violation, or alleged violation, of any statute, ordinance, order, rule, regulation, permit, judgment, or license relating to the use, generation, release, leakage, spillage, emission, escape, discharge, storage, disposal, or transportation of H
azardous Materials
in, on, under, or about, or to or from, the Site
by
Developer or occurring during the Term or caused by Developer
; (iii)
the physical and environmental
condition of the Site caused or contributed to by Developer or occurring during the Term , and (iv)
any
Liabilities caused or contributed to by acts or omissions of Lessee relating to any Environmental Laws and other Governmental Requirements relating to Hazardous Materials and/or the environmental and/or physical condition of the Site. The foregoing indemnification shall continue in full force and effect regardless of whether such condition, liability, loss, damage, cost, penalty, fine, and/or expense shall accrue or be discovered before or after the termination of the Required Covenant Period. This
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indemnification supplements and in no way limits the indemnification and defense obligations set forth in Section
s 4.5 and
4.7 of the AHA. Lessee’s obligations under this Section
10.3 shall survive the
expiration of this Lease and shall not merge with any grant deed. Notwithstanding the foregoing, Lessee shall not be obligated to indemnify Authority with respect to the conse quences of any act of
gross negligence or willful misconduct of Authority.
10.4 Duty to Prevent Hazardous Material Contamination
.
Lessee shall take all
necessary precautions to prevent the release of any Hazardous Materials into the environment. Such precautions shall include compliance with all Governmental Requirements with respect to Hazardous Materials. In addition, Lessee shal
l install and utilize such equipment and implement and adhere to such procedures as are consistent with the standards generally applied by apartment complexes in San Bernardino County, California as respects the disclosure, storage, use, removal, and dispo
sal of
Hazardous Materials. Lessee shall notify each of City and Authority, and provide to each of City and Authority a copy or copies of any notices of violation, notices to comply, citations, inquiries, clean up or abatement orders, cease and desist orders, reports filed pursuant to self
-
reporting requirements and
reports filed or applications made pursuant to all Environmental Laws and other Governmental Requirements, and Lessee shall report to each of City and Authority, as soon as possible after each incident, any unusual or potentially important incidents in the event of a release of any Hazardous Materials into the environment.
10.5 Obligation of Lessee to Remediate Premises
. Notwithstanding the obligation of
Lessee to indemnify Authority pursuant to Section
10.3 of this Lease, Lessee shall, take (i)
all actions
required by any federal, state, regional, or local governmental Authority or political subdivision or any Governmenta
l Requirements and (ii)
all actions necessary to make full economic use of the Site for the purposes contemplated by this Lease and the AHA, which requirements or necessity arise from the presence upon, about or beneath the Site of any Hazardous Materials
or Hazardous Materials
Contamination no matter when occurring. Such actions shall include, but not be limited to, the investigation of the environmental condition of the Site, the preparation of any feasibility studies or reports and the performance of any cleanup, remedial, removal or restoration work. Lessee shall take all actions necessary to promptly remediate or restore the Site to an environmentally sound condition for the uses contemplated by this Lease and the AHA.
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10.6 Storage or Handling of Hazardous Materials . Lessee shall comply with all Governmental Requirements for the storage, use, transportation, handling and disposal of Hazardous Materials on or about the Site. In the event Lessee does store, use, transport, handle or dispose of any Hazardous Materials, L
essee shall notify Authority in writing at least ten (10) days prior to their first appearance on the Site and Lessee’s failure to do so shall constitute a material default under this Lease.
Lessee shall conduct all monitoring activities required or presc ribed by applicable Governmental
Requirements, and shall, at its sole cost and expense, comply with all posting requirements of Proposition
65 or any other similarly enacted Governmental Requirements. In addition, in the event of any complaint or governme
ntal inquiry, or if otherwise deemed necessary by Authority in its reasonable judgment, Authority may require Lessee, at Lessee’s sole cost and expense, to conduct specific monitoring or testing activities with respect to Hazardous Materials on the Site.
Lessee’s
monitoring programs shall be in compliance with applicable Governmental Requirements, and any program related to the specific monitoring of or testing for Hazardous Materials on the Site, shall be satisfactory to Authority, in Authority’s reasonable discretion. Lessee shall further be solely responsible, and shall reimburse Authority, for all costs and expenses incurred by Authority arising out of or connected with the removal, clean
-
up and/or restoration work and materials necessary to return the
Site and any property adjacent to the Site affected by Hazardous Materials emanating from the Site to their condition existing at the Commencement. Lessee’s obligations hereunder shall survive the termination of this Lease and shall not merge with any grant deed.
10.7 Environmental Inquiries
.
Lessee shall notify each of City and Authority upon
receipt, and provide to City and Authority a copy or copies, of the following environmental permits, disclosures, applications, entitlements or inquiries relating to the Site and the Development: notices of violation, notices to comply, citations, inquiries, clean up or abatement orders,
cease and desist
orders, reports filed pursuant to self
-
reporting requirements and reports filed or applications made pursuant to any Environmental Laws and other applica
ble Governmental Requirements relating to
Hazardous Materials and underground tanks, and Lessee shall report to each of City and Authority, as soon as possible after each incident, all material information relating to or arising from such incident, includi
ng, but not limited to, the following:
(a)
All required reports of releases of Hazardous Materials, including notices of any release of Hazardous Materials as required by any Governmental Requirements;
(b)
All notices of suspension of any permits relating to Hazardous Materials;
(c)
All notices of violation from federal, state or local environmental authorities relating to Hazardous Materials;
(d)
All orders under the State Hazardous Waste Control Act and the State Hazardous Substance Account Act and corresponding federal statutes, concerning investigation, compliance schedules, clean up, or other remedial actions;
(e)
All orders under the Porter Cologne Act, including corrective action orders, cease and desist orders, and clean up and abatement orders;
(f)
Any notices of violation from OSHA or Cal OSHA concerning employees’ exposure to Hazardous Materials;
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(g) All complaints and other pleadings filed against Lessee relating to Lessee’s storage, use, transportation, handling or disposal of Hazardous Materials on or about the Site; and (h)
Any and all other notices, citations, inquiries, orders, filings or any other reports containing information which would have a materially adverse effect on the Site or Authority’s liabilities or obligations relating to Hazardous Materials.
In the event of a release of any Hazardous Materials into the environment, Lessee shall, as soon as possible after the release, furnish to each of City and Authority a copy of any and all reports relating thereto and copies of all correspondence with governmental agencies relating to the release. Upon request of City and/or Authority, but subject to any limitations imposed by law or by court order, Lessee shall furnish to each of City and Authority a copy or copies of any and all other environmental entitl
ements or inquiries relating to or affecting the Site in Lessee’s possession and/or shall notify each of City and Authority of any environmental entitlements or inquiries relating to or affecting the Site within Lessee’s actual or constructive knowledge if
Lessee is not in possession of same, including, but
not limited to, all permit applications, permits and reports including, without limitation, those reports and other matters which may be characterized as confidential.
11. ALTERATION OF IMPROVEMENTS.
Upon completion of the Site Improvements, Lessee shall not make or permit to be made any material structural alteration of, addition to or change in the Site Improvements (which shall be deemed to be material if the cost or value of such alteration(s) or a ddition(s) exceeds One Hundred Ten
Thousand Dollars ($110,000.00) as to any item or Five Hundred Twenty -
Five Thousand Dollars
($525,000.00) as all such items are aggregated), nor demolish all or any part of the Site Improvements without the prior written c
onsent of Authority; provided, however, that the foregoing shall not prohibit or restrict the repair and/or replacement of the improvements to the Site by Lessee in accordance with Section
9 of this Lease. In requesting such consent Lessee shall submit to
Authority detailed plans and
specifications of the proposed work and an explanation of the need and reasons therefor. In addition to the foregoing, compliance with City’s municipal code and
building permitting and inspections shall
be required.
This provision shall not limit or set aside any obligation of Lessee under this Lease to maintain the Site and the improvement thereon in a clean and safe condition, including structural repair and restoration of damaged Site Improvements. Authority shall
not be obligated by this Lease to make any
improvements to the Site or to assume any expense therefor.
Lessee shall not commit or suffer to be committed any waste or impairment of the Site or the improvements to the Site, or any part thereof, except as otherwise permitted pursuant to this Lease.
Lessee agrees to keep the Site and the Site Improvements clea
n and clear of refuse and obstructions,
and to dispose of all garbage, trash and rubbish in a manner satisfactory to Authority.
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12. DAMAGE OR DESTRUCTION .
The terms of the
Authority
Regulatory Agreement regarding damage and destruction shall apply.
13. SALE, ASSIGNMENT, SUBLEASE OR OTHER TRANSFER.
Except for (a)
leases of particular dwelling Units to tenants, and (b)
the lease of or grant of an
easement or license to City, Lessee shall not sell, assign, sublease, or otherwise transfer this Lease or any right therein, nor make any total or partial sa
le, assignment, sublease, or transfer in any other mode or form of the whole or any part of the Site or the Site Improvements (each of which events is referred to in this Lease as an “Assignment”), without prior written approval of Authority
in its sole an
d
absolute discretion, except as specifically provided below . The term “Assignment” shall be deemed
to include (without limitation) all refinancing thereof and any other loans approved by Authority. Any purported assignment without the prior written consent of Authority shall be made null and void and shall confe
r no rights whatsoever upon any purported assignee or transferee.
Notwithstanding any other provision of this Lease to the contrary, Authority shall
not
unreasonably withhold its approval of an assignment of this Lease or conveyance of the Site or the improvements thereto, or any part thereof, in connection with any of the following:
(a)
Any transfers to an entity or entities in which Lessee retains a minimum of fifty
-one percent (51%) of the ownership or beneficial interest and retains management and control of the transferee entity or entities
, provided reasonable evidence of the same is provided to Authority in advance
.
(b)
The conveyance or dedication of any portion of the Site to City or other appropriate governmental Authority
;
or the granting of easements or permits to facilitate construction of the Site Improvements
provided reasonable evidence of the need for the same is provided to the Authority in advance, and only encumbers Lessee’s leasehold interest .
In the event of a proposed assignment by Lessee under subparagraph (a)
above, Lessee agrees
that at least thirty (30) days prior to such assignment it shall give written notice to Authority including a request for approval of such assignment and satisfactory evidence that the assignee
will
assum
e
the
obligations of this Lease
concurrently with the assignment of this Lease.
Authority agrees that it will
reasonably
consider any other
written
request for Authority’s
consent to a
n assignment of this Lease
after the achievement of occupancy of ninety percent (90%) or more of the rental units in conformity with the
Authority
Regulatory Agreement provided s
uch
written
request
is
accompanied by
reasonable
evidence
of
the proposed assignee’s operational qualifications
and experience, and its financial commitments and resources, and the financial terms of such Assignment (including the consideration proposed to flow to Developer or any affiliated pers on or
entity).
Notwithstanding the foregoing, the transfer of limited partnership interests to tax credit investors shall not entitle Authority to receive compensation (by virtue of such transfer to tax credit investors). An assignment and assumption agreement in form satisfactory to Authority’s legal counsel shall also be required for all proposed assignments. Lessee shall promptly furnish to Authority such further information as may be reasonably requested.
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14. TRIPLE NET LEASE; DISCLAIMER.
Authority and Lessee intend that this Lease be a so called “triple net” lease and that except as expressly provided herein all costs, expenses and obligations with respect to the Site during the Lease Term be borne by Lessee and not by Authority.
During the Term, Lessee agrees that Authority and City, their agents, officers, representatives and employees, shall not be liable for any claims, liabilities, penalties, fines or for any damage to the goods, properties or effects of Lessee, its sublessees
or representatives, agents, employees, guests,
licensees, invitees, patrons or clientele or of any other person whomsoever, nor for personal injuries to, or deaths of any persons, whether caused by or resulting from any act or omission of Lessee or its su
blessees or any other person on or about the Site and the Site Improvements, or in connection with the operation thereof, or from any defect in the Site or the Site Improvements, or from any displacement of tenants or liability for relocation assistance pursuant to Government Code Section
7260,
et seq
., due
to the acts of Lessee hereunder. Lessee agrees to indemnify and save free and harmless Authority and City and their authorized agents, officers, representatives and employees against any and all claims,
actions, damages, liability (including reasonable expenses and attorneys’ fees) concerning loss of life, personal injury and/or damage to property arising from or out of any occurrence in, upon or at the Site and/or the Site Improvements or the occupancy or use by Lessee of the Site and/or the Site Improvements or any part thereof, or arising from or out of Lessee’s failure to comply with any provision of this Lease or otherwise occasioned wholly or in part by any act or omission of Lessee, its agents, representatives, contractors, employees, servants, customers or licensees. Lessee shall not be responsible for (and such indemnity shall not apply to) any acts, errors or omissions of Authority, City, or their respective agents, officers, representatives or
employees.
15. INSURANCE.
15.1 Insurance to be Provided by Lessee
.
During the Term, Lessee, at its sole cost and
expense, shall:
(a)
Maintain or cause to be maintained a policy or policies of insurance against loss or damage to the Site Improvements and all improvements of all property of an insurable nature located upon the Site, resulting from fire, lightning, vandalism, malicious mis chief, and such other
perils ordinarily included in extended coverage fire insurance and casualty loss policies. The amount of the policies shall cover the Full Insurable Value.
(b)
Maintain or cause to be maintained use and occupancy or business interruption or rental income insurance against the perils of fire, lighting, vandalism, malicious mischief, and such other perils ordinarily included in extended coverage fire insurance poli cies, in an amount equal to not
less than twelve (12) months’ gross rental income payable to Lessee from tenants on the Site, assuming one hundred percent (100%) occupancy.
(c)
Maintain or cause to be maintained, comprehensive general liability insurance with respect to the Site and the Site Improvements and the operations of Lessee in, on or about the Site and the Site Improvements, including, but not limited to, owned and hired
motor vehicle liability, cross
liability and severability of i
nterests, personal injury, XC&U
, blanket contractual, owners protective
broad form property damage, and product/completed operations liability coverage in an amount not less than Two Million Do
llars ($2,000,000), combined single limit, public liability insurance to protect against loss from liability for damages on account of personal injury, including death therefrom,
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suffered or alleged to be suffered by any person or persons whomsoever on or about the Site and the Site Improvements, or in connection with the operation thereof, resulting directly or indirectly from any acts or activities of Lessee or its sublessees, or
any person acting for Lessee, or under their
respective control or direction, and also to protect against loss from liability imposed by law for damages to any property of any person occurring on or about the Site and the Site Improvements, or in connecti
on with the operation thereof, caused directly or indirectly by or from acts or activities of Lessee of its sublessees, or any person acting for Lessee, or under their respective control or direction.
Such property damage and personal injury insurance sha
ll also provide for and protect against incurring
any legal cost in defending claims for alleged loss. The required amount of insurance shall be subject to increases as Authority may reasonably require from time to time, but not more frequently than every
twenty
-
four (24) months. In no event shall such increase or increases exceed the increase during such period in the United States Department of Labor, Bureau of Labor Statistics, Consumer Price Index for Urban Wage Earners and Clerical Workers, Subgroup
“All Items,” in the geographical area applicable
to San Bernardino County. Lessee agrees that provisions of this paragraph as to maintenance of insurance shall not be construed as limiting in any way the extent to which Lessee may be held responsible for the payment of damages to persons or property resulting from Lessee’s activities, activities of its sublessees or the activities of any other person or persons for which Lessee is otherwise responsible.
(d)
Maintain or cause to be maintained worker’s compensation insurance issued by a responsible carrier authorized under the laws of the State of California to insure employers against liability for compensation under the workers’ compensation laws now in force
in California, or any
laws hereafter enacted as an amendment or supplement thereto or in lieu thereof. Such workers’ compensation insurance shall cover all persons employed by Lessee in connection with the Site and the Site Improvements and shall cover full liability for compensation under any such act aforesaid, based upon death or bodily injury claims made by, for on behalf of any person incurring or suffering injury or death in connection with the Site or the Site Improvements or the operation thereof
by Lessee.
15.2 Definition of “Full Insurable Value
.
The term “Full Insurable Value” as used in this
Section
15 means the actual replacement cost (excluding the cost of excavation, foundation and footings below the lowest floor and without deduction for depreciation) of the Site Improvements, including the c
ost of construction of the Site Improvements, architectural and engineering fees, and inspection and supervision. To ascertain the amount of coverage required, Lessee shall cause the Full Insurable Value to be determined from time to time by appraisal by the insurer or, if no such appraisal is available, by an appraiser mutually acceptable to Authority and Lessee, not less often than once every three (3) years.
15.3 General Insurance Provisions
.
All policies of insurance provided for in this
Section
15, except for the workers’ compensation insurance, shall name Lessee as the insured and loss payee and Authority and City and their respective officers, employees, agents, and representatives, as addi
tional insureds, as their respective interests may appear. All property casualty insurance policies shall include the interest of any Lessee’s Mortgagee, and may provide that any loss is payable to Lessee’s Mortgagee in which event such policies shall con tain standard mortgage loss payable clauses.
Lessee agrees to timely pay all premiums for such insurance and, at its sole cost and expense, to comply and secure compliance with all insurance requirements necessary for the maintenance of such insurance.
Lessee agrees to submit policies of all insurance required by Section
15 of this Lease, or
certificates evidencing the existence thereof, to Authority
on or before the effective date of this
Lease
, indicating full coverage of the contractual liability impos ed by this Lease. At least thirty (30)
days prior to expiration of any such policy
or any subsequent policy
,
as applicable,
copies of renewal
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policies, or certificates evidencing the existence thereof, shall be submitted to Authority. All policies of insurance required of Lessee herein shall be issued by insurance companies with a general policy holder’s rating of not less than A and a financia
l rating of not less that Class X, as rated in the most current available “Best’s Key Rating Guide”, and which are qualified to do business in the State of California. All policies or certificates of insurance shall also: (i)
provide that such policies s
hall not
be canceled or limited in any manner without at least thirty (30) days prior written notice to Authority; and (ii)
provide that such coverage is primary and not contributing with any insurance as may be obtained by Authority and shall contain a wa
iver of subrogation for the benefit of City and Authority.
Coverage provided hereunder by Lessee shall be primary insurance and not be contributing with any insurance maintained by Authority or City, and the policy shall contain such an endorsement.
The insurance policy or the endorsement shall contain a waiver of subrogation for the benefit of City and Authority. None of the above
-
described policies shall require Lessee to meet a deductible or self -
insured retention amount of more than Five Thousand Dollars ($5,000.00) unless first approved in writing by the Aut
hority Executive Director. All policies shall be written by good and solvent insurers qualified to do business in California and shall have a policyholder’s rating of A or better in the most recent edition of “Best’s Key Rating Guide
–
Property and Casual
ty.” The required certificate shall be
furnished by Lessee at the time set forth herein.
15.4 Failure to Maintain Insurance
/Maintenance
. If Lessee fails or refuses to procure or
maintain insurance as required by this Lease, Authority shall have the right, at Authority’s election, and upon ten (10) days prior notice to Lessee, to procure and maintain such insurance.
Lessee shall
pay to Authority within ten (10) days after written demand with evidence of costs, as rent, an amount equal to one hundred fifteen percent (115%) of the amounts paid by Authority for insurance premiums or costs to repair and maintain the Devel
opment upon the failure by Lessee to timely and fully provide such insurance and
/or
maintenance.
15.5 Insurance Proceeds Resulting from Loss or Damage to Site Improvements .
All
proceeds of insurance with respect to loss or damage to the Site Improvements during the term of this Lease shall be payable, under the provisions of the policy of insurance, to Lessee, and said proceeds shall constitute a trust fund to be used for the
restoration, repair and rebuilding of the Site
Improvements in accordance with plans and specifications approved in writing by Authority. To the extent that such proceeds exceed the cost of such restoration, repair or rebuilding, then such proceeds shall
be retained by the party that purchased the insurance.
If this Lease is terminated by mutual agreement of Authority and Lessee and said Site Improvements are not restored, repaired or rebuilt, the insurance proceeds shall be jointly retained by Authority and Lessee and shall be applied first to any payments du
e under this Lease from Lessee to
Authority, second to restore the Site and
Site
Improvements to their original condition and to a neat
and clean condition, and finally any excess shall be apportioned between Lessee and Authority as their interests may app
ear; provided, however, that within any period when there is an outstanding mortgage upon the Site Improvements, such proceeds shall be applied first to discharge the debt secured by the mortgage and then for the purposes and in the order set forth above i n this paragraph.
16. EMINENT DOMAIN.
If the Site and/or the
Site
Improvements or any part thereof shall be taken for public purposes by any public authority other than Authority by condemnation as a result of any action or proceeding in eminent domain, then, as between Authority and Lessee (or mortgagee, if a mortgage
is then in
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effect), the interests of Authority and Lessee (or mortgagee) in the award and the effect of the taking upon this Lease shall be as set forth in the construction and permanent loan documents, and if no such loan encumbers the property then as follows:
(a)
In the event of such taking of only a part of the Site, leaving the remainder of the Site in such location and in such form, shape and size as to be used effectively and practicably for the conduct thereon of the uses permitted hereunder, this Lease shall terminate and end as to the portion of the Site so taken as of the date title to such portion vests in the condemning authority, but shall continue in full force and effect as to the portion of the Site not so taken and from and after such date the rental
required by this Lease to be paid by Lessee to Authority shall be reduced in the proportion which the number of square feet so taken bears to the total number of square feet in the Site. (b)
In the event of taking of only a part of the Site, leaving the remainder of the Site in such location, or in such form, shape or reduced size as to render the same not effectively and practicably usable, for the conduct thereon of the uses permitted hereunder, this Lease and all right, title and interest thereunder shall cease on the date title to the Site or the portion thereof so taken vests in the condemning authority.
(c)
In the event the entire the Site is taken, this Lease and all of the right, title and interest thereunder, shall cease on the date title to the Site so taken vests in the condemning authority.
(d)
Promptly after a partial taking, at Lessee’s expense and in the manner specified in provisions of this Lease related to maintenance, repairs, alterations, Lessee shall restore the Site Improvements, to the extent of condemnation proceeds received by Lessee , so as to place them in a
condition suitable for the uses and purposes for which the Site was leased.
(e)
In the event of any taking under subparagraphs (a), (b) or (c) hereinabove, that portion of any award of compensation attributable to the fair market value of the Site or portion thereof taken, valued as subject to this Lease, shall belong to Authority. T hat portion of any award attributable
to the fair market value of Lessee’s leasehold interest in the Site and fee interest in the improvement thereon pursuant to this Lease shall belong to Lessee. Said award shall be used for the restoration, repair or rebuilding of the Site Improvements in accordance with plans and specifications approved in writing by Authority to the extent necessary to restore or repair the Site Improvements and any remaining severance damages shall be payable to Lessee; except that,
during the last ten (10) years of
the Term, any remaining severance damages shall be payable to Authority. The value of each interest for the purpose of apportionment under this Section 16 shall be the fair market value of such interests at the time of th
e taking.
(f)
Provided, however, that within the period during which there is an outstanding mortgage on the Site Improvements, the mortgagee shall be entitled to any portion of the award attributable to the Site Improvements, to the extent of its interest therein. (g)
Notwithstanding the foregoing provisions of this Section 16, Authority may, in its discretion and without affecting the validity and existence of this Lease, transfer Authority’s interests in the Site in lieu of condemnation to any authority entitled to exercise the power of eminent domain. In the event of such transfer by Authority, Lessee (or mortgagee if a mortgage is then in effect) and Authority shall retain whatever rights they may have to recover from said authority the fair market value of their re
spective interests in the Site Improvements taken by the authority.
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(h) All valuations to be made pursuant to this Section 16 shall be made by mutual agreement of Authority and Lessee.
(i)
Authority agrees that during the Term, provided that this Lease shall remain in effect, Authority shall not exercise eminent domain powers as to the Site or the Site Improvements.
17. OBLIGATION TO REFRAIN FROM DISCRIMINATION.
There shall be no discrimination against or segregation of any person or group of persons, on account of sex, marital status, race, color, creed, religion, national origin or ancestry in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the Site and the
Site
Improvements,
and Lessee itself or any person claiming under or through it shall not establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use o
r occupancy of tenants, lessees, subtenants, sublessees, or vendees thereof or any portion thereof, or in the providing of goods, services, facilities, privileges, advantages and accommodation.
Lessee shall refrain from restricting the rental, sale, or lease of the Site and the Site
Improvements, or any portion thereof, on the basis of sex, marital status, race, color, creed, religion, ancestry or national origin of any person. All such leases or contracts shall contain or be subject to substantially the following nondiscrimination or nonsegregation clauses:
(a)
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 any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdiv
ision
(m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the leasing, subleasing, transferring, use, occupancy, tenure, or enjoyment of the premises herein leased nor shall the lessee himself or hersel f, 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 premises herein leased.”
(b)
In Contracts:
“There shall be no discrimination against or segregation of, any person or group of persons on account of any basis listed in subdivision (a) or (d) of Section
12955 of the
Government Code, as those bases are defined in Sections
12926, 12926.1,
subdivision
(m) and paragraph (1) of subdivision (p) of Section
12955, and
Section
12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the premises which are the subject of this Agreement, nor shall the gran
tee or any person claiming under or through him or her, establish or permit any practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees,
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subtenants, sublessees, or vendees in the premises herein conveyed. The foregoing covenants shall run with the land.”
18. NONDISCRIMINATION IN EMPLOYMENT.
Lessee, for itself and its successors and assigns, agrees that during the operation of the Site
Improvements provided for in this Lease, and during any work of repair or replacement, Lessee shall not discriminate against any employee or applicant for employment because of race, color, creed, religion, sex, marital status, physical or mental disabili ty, sexual orientation, ancestry or national
origin, or on the basis of any other category or status not permitted by law.
19. [INTENTIONALLY OMITTED].
20. COMPLIANCE WITH LAW.
Lessee agrees, at its sole cost and expense, to comply and secure compliance by all contractors and tenants of the Site in connection with the development of the Site and the operation of the Site with all the requirements now in force, or which may hereafter be in force, of all municipal, county, state and federal authorities, pertaining to the Site and the improvements to the Site, as well as operations conducted thereon, and to faithfully observe and secure compliance by all contractors and tenants of th
e Site and
the Site
Improvements with, in the use of the Site and the
Site
Improvements
all applicable county and municipal ordinances and state and federal statutes now in force or which may hereafter be in force, and to pay before delinquency all taxes, assessments, and fees, if any, assessor levied upon Lessee or the Site or
the
Site
Improvements, including the land and any buildings,
structures, machines, appliances or other improvements of any nature whatsoever, erected, installed or maintained by Less
ee or by reason of the business or other activities of Lessee upon or in connection with the Site and the
Site
Improvements. Lessee shall use good faith efforts to prevent tenants from maintaining any nuisance or other unlawful conduct on or about the Property, and shall take such actions as are reasonably required to abate any such violations by tenants of the S ite and the Site
Improvements. The judgment of any court of competent jurisdiction, or the admission of Lessee or any sublessee or permittee in a
ny action or proceeding against them, or any of them, whether Authority be a party thereto or not, that Lessee, sublessee or permittee has violated any such ordinance or statute in the use of the Site or the
Site
Improvements shall be conclusive of that fact as between Authority and Lessee, or such sublessee or permittee. Lessee shall comply with all applicable laws, regulations, and any applicable labor standards, all of which laws and regulations shall be deeme d to be
incorporated herein by reference. L
essee shall comply with the Tax Credit Rules.
21. ENTRY AND INSPECTION.
In addition to and without limitation to such rights as Authority or City may have as a matter of law, Authority reserves and shall have the right between the hours of 8:00 a.m. and 8:00
p.m., upon
twenty
-
four (24) hours prior notice (except in cases of em
ergency in which case entry may be made at
any time and without notice) to Lessee by the Authority Executive Director, to enter the Site and the Site Improvements for the purpose of viewing and ascertaining the condition of the same, or to protect its inte
rests in the Site and the improvements to the Site or to inspect the operations conducted thereon.
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22. RIGHT TO MAINTAIN.
In the event that the entry or inspection by Authority pursuant to Section 21 of this Lease
discloses that the Site or the
Site
Improvements are not in a decent, safe, and sanitary condition, Authority shall have the right, after thirty (30) days written notice to Lessee (except in case of emergency, in which event no notice shall be necessary), to have any necessary maintenance w ork
done for and at the expense of Lessee and Lessee hereby agrees to pay promptly any and all costs incurred by Authority in having such necessary maintenance work done in order to keep the Site and the Site Improvements in a decent, safe and sanitary condition. The rights reserved in this Section 24 shall not create any obligations on Authority or increase obligations elsewhere in this Lease imposed on Authority.
23. EVENTS OF DEFAULT AND REMEDIES.
23.1 Events of Default by Lessee
.
The occurrence of any one (1) or more of the following
shall constitute an event of default hereunder:
(a)
Lessee shall fail to construct the Improvements in accordance with the AHA and within the times set forth in the AHA; or
(b)
Lessee shall
otherwise fail to comply with the AHA, or shall fail to comply with the Authority Regulatory Agreement or the Regulatory Agreement (Density Bonus), or Lessee’s Loan Agreement with or related Promissory Note to
Wakeland
(loaning the grant funds provided to
Wakeland
by Authority) or the deed of trust (if any) securing such Promissory Note,
and shall fail to
cure the default within thirty (30) days after written notice from Authority
; or
(c)
Wakeland shall default under the Grant Agreement among Wakeland, Authority,
and the City, and shall fail to cure the default within thirty (30) days after written notice from Authority; or
(d)
Lessee shall fail or refuse to pay, within ten (10) days of notice from Authority that the same is due, any installment of rent or any other sum required by this Lease to be paid by Lessee; or
(e)
Lessee shall fail to perform any covenant or condition of this Lease other than as set forth in subparagraphs (a) or (b) above, and any such failure shall not be cured within thirty (30) days following the service on Lessee of a written notice from Authori ty specifying the failure
complained of, or if it is not practicable to cure or remedy such failure within such thirty (30) day period, then Lessee shall not be deemed to be in default if Lessee shall commence such cure within such thirty (30) day period a
nd thereafter diligently prosecute such cure to completion; or (f)
Subject to any restrictions or limitations placed on Authority by applicable laws governing bankruptcy, Lessee’s (i)
application for, consent to or suffering of the appointment of a receiver, trustee or liquidator for all or for a substantial portion of it s assets; (ii)
making a general
assignment for the benefit of creditors; (iii)
admitting in writing its inability to pay its debts or its willingness to be adjudged a bankrupt; (iv)
becoming unable to or failing to pay its debts as they
mature; (v)
being a
djudged a bankrupt; (vi)
filing a voluntary petition or suffering an involuntary petition under any bankruptcy, arrangement, reorganization or insolvency law (unless in the case of an involuntary petition, the same is dismissed within ninety
(90) days of s
uch filing); (vii)
convening a
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meeting of its creditors or any class thereof for purposes of effecting a moratorium, extension or composition of its debts; or (viii)
suffering or permitting to continue unstayed and in effect for sixty
(60) consecutive days any attachment, levy, execution or seizure of all or a portion of Lessee’s assets or of Lessee’s interest in this Lease
,
then, upon notice having been given by Authority and the failure to cure within thirty (30) of such notice, such event shall constitute an event of default under thi
s Lease. Any cure provided by the limited partner of Lessee shall be treated as a cure by Lessee.
23.2 Remedies of Authority
.
In the event of any such default as described in Section 23.1 of this Lease which default has not been timely cured, Authority may, at its option:
(a)
Correct or cause to be corrected said default and charge the costs thereof (including costs incurred by Authority in enforcing this provision) to the account of Lessee, which charge shall be due and payable within thirty (30) days after presentation by Aut hority of a statement
of all or part of said costs;
(b)
Correct or cause to be corrected said default and pay the costs thereof (including costs incurred by Authority in enforcing this provision) from the proceeds of any insurance;
(c)
Exercise its right to maintain any and all actions at law or suits in equity to compel Lessee to correct or cause to be corrected said default;
(d)
Have a receiver appointed to take possession of Lessee’s interest in the Site and the Site Improvements, with power in said receiver to administer Lessee’s interest in the Site and the Site Improvements, to collect all funds available to Lessee in connecti on with its operation and
maintenance of the Site and the Site Improvements; and to perform all other consistent with Lessee’s obligation under this Lease as the court deems proper;
(e)
Terminate this Lease by written notice to Lessee.
23.3 Right of Authority in the Event of Termination of Lease .
Upon termination of this
Lease pursuant to Section
23 .2 of this Lease, it shall be lawful for Authority to re -
enter and repossess
the Site and the Site Improvements and Lessee, in such event, does hereby waive any demand for possession thereof, and agrees to surrender and deliver the Site and the Site Improv
ements peaceably
to Authority immediately upon such termination in good order, condition and repair, except for reasonable wear and tear. Lessee agrees that upon such termination, title to all the Site
Improvements
on the Site shall vest in Authority
.
Termination of this Lease shall not relieve or release Lessee from any obligation incurred
pursuant to this Lease prior to the date of such termination. Termination of this Lease shall not relieve Lessee from the obligation to pay any sum due to Authority or from any claim for damages against Lessee.
23.4 Damages
. Should Authority elect to terminate this Lease pursuant to the provisions of this Section
23, Authority may recover from Lessee, as damages, any and all rent charged by Lessee
to tenants
in excess of the rent permitted by the
Authority
Regulatory Agreement and Regulatory
Agreement (Density Bonus), and the costs incurred by Authority to cure any then ongoing default by Lessee under this Lease (notwithstanding the termination of the Lease), and any other amounts necessary to compensate Aut
hority for all the detriment proximately caused by Lessee’s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to
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result therefrom including, but not limited to, any costs or expenses incurred by Authority in (i)
retaking possession of the Site and the improvements thereon, including reasonable attorneys’ fees therefor, (ii)
maintaining or preserving the Site and the Site Improvements after default, (iii)
preparing
the Site and the Site Improvements for reletting to a new tenant, including repairs or alterations to the Site and the Site Improvements, (iv)
leasing commissions, or (v)
any other costs necessary or
appropr
iate to relet the Site and the Site Improvements, plus (e) at Authority’s election, any other amounts in addition to or in lieu of the foregoing as may be permitted from time to time by the law of the State of California.
23.5 Rights and Remedies are Cumulative
. The remedies provided by this Section
are
not exclusive and shall be cumulative to all other rights and remedies possessed by Authority. The exercise by Authority of one or more such 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 Lessee.
24. MISCELLANEOUS.
24.1 Governing Law; Interpretation
.
The laws of the State of California shall govern the
interpretation and enforcement of this Lease.
This Lease shall be interpreted as if jointly prepared by both parties.
24.2 Legal Actions
. In addition to any other rights or remedies, 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 purpose of this Lease. Such legal actions mu
st be instituted in the
Superior Court of San Bernardino County, State of California, in any other appropriate court in that County, or in the Federal District Court in the District of California in which the Site is located.
24.3 Acceptance of Service of Process
.
In the event that any legal action is commenced
by Lessee against Authority, service of process on Authority shall be made by personal service upon the Chairman of Authority or the Authority Executive Director, or in such other manner as may be provided by
law.
In the event that any legal action is commenced by Authority against Lessee, service of process on Lessee shall be made by personal service upon Lessee or in such other manner as may be provided by law, and shall be effective whether made within or w ithout the State of California.
24.4 Attorneys’ Fees And Court Costs
.
In the event that either Authority or Lessee shall
bring or commence an action to enforce the terms and conditions of this Lease or to obtain damages against the other party arising from any default under or violation of this Lease, then the prevailing par
ty shall be entitled to and shall be paid reasonable attorneys’ fees and court costs therefor in addition to whatever other relief such prevailing party may be entitled.
24.5 Financial Statement; Inspection of Books And Records .
Lessee shall submit to
Authority on an annual basis, not later than seventy
-
five
(75) days after the last day of each Lease Year,
an Audited Financial Statement for the operation of the Site and the Site Improvements, which is prepared by a certified publi
c accounting firm.
In addition, Authority shall have the right (at Lessee’s office, upon not less than forty
-
eight (48) hours’ notice, and during normal business hours) to inspect the books and records of Lessee pertaining to the Site as pertinent to the purposes of this Le ase and the
AHA. Lessee also has the right (at Authority’s office, upon not less than forty
-
eight (48) hours’ notice,
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and at all reasonable times) to inspect the books and records of Authority pertaining to the Site as pertinent to the purposes of this Lease and the AHA.
24.6 Interest
.
Any amount due Authority that is not paid when due shall bear interest from the date such amount becomes due until it is paid. Interest shall be at a rate equal to the lesser of (i)
seven percent
(7%) per annum, compounded annually, on the first day of the month such amount becomes due, and (ii)
the maximum rate permitted by applicable law.
24.7 Notices; Cure by Limited Partners
. All notices, statements, demands, requests,
consents, approvals, authorizations, offers, agreements, appointments or designations hereunder by either party to the other shall be in writing and shall be given either by (i)
delivery by reputable
document del
ivery service such as Federal Express that provides a receipt showing date and time of delivery, or (ii)
mailing in the United States mail, certified or registered mail, return receipt requested, postage prepaid, and addressed as follows:
Authority:
Highland Housing Authority
27215 Base Line
Highland, California 92346
Attention: Executive Director
with a copy to: (delivery of which shall not constitute notice to Authority)
Richards Watson & Gershon
350 South Grand Avenue, 37th Floor
Los Angeles, California 90071
Attention: Maricela Marroquin, City Attorney
Lessee
:
[Wakeland Highland LP
]
1230 Columbia St., Suite 950
San Diego, California 92101
Attention: Rebecca Louie
or to su
c
h other address as either party shall later designate for such purposes by written notice to the other party. Notices shall be de
emed effective: (i) if sent by messenger, one business day after delivery to a reputable delivery service for overnight delivery; or (ii) if sent by certified mail, then the date of delivery (or inability to deliver or refusal to accept delivery) shown on the return receipt.
Copies of all notices which are sent to Lessee under the Lease shall also be sent to
limited
partners of Lessee provided that Lessee shall have delivered the names and addresses of such limited partner(s) to Authority in writing with a reference to this Section; provided
, however,
that a failure by
Authority to send such notice shall not constitute a default by Authority or vitiate or otherwise negatively affect any notice given to Lessee. Lessee and Authority hereby agree that any cure of any default made
or tendered by Lessee’s limited partners shall be deemed to be a cure by Lessee and shall be accepted or rejected on the same basis as if made or tendered by Lessee.
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24.8 Time is of the Essence . Time is of the essence in the performance of the terms and conditions of this Lease.
24.9 Non
-
Merger of Fee and Leasehold Estates
.
If both Authority’s and Lessee’s estates
in the Site or the Site Improvements or both become vested in the same owner, this Lease shall nevertheless not be destroyed by application of the doctrine of merger except at the express election of Authority and L
essee’s Mortgagee. The voluntary or other surrender of this Lease by Lessee, or a mutual cancellation thereof, shall not work as a merger and shall, at the option of Authority, terminate all or any existing sublease or subtenancies or may, at the option of Authority, operate as an assignment to Authority of any or all such existing subleases or subtenancies.
24.10 Holding Over
. The occupancy of the Site after the expiration of the Term of this Lease with the written consent of the Authority
shall be construed to be a tenancy from month to month, and all other terms and conditions of this Lease shall continue in full force and effect.
24.11 Conflict of Interest
.
No member, official or employee of Authority shall have any personal interest, direct or indirect, in this Lease nor shall any such member, official or employee participate in any decision relating to the Lease which affects his personal interests or the i nterests of
any limited partnership, partnership or association in which he is directly or indirectly interested.
Lessee warrants that it has not paid or given, and will not pay or give, any third party any money or other consideration for obtaining this Lease.
24.12 Non
-
Liability of Authority Officials And Employees
. No member, official, officer,
employee, agent, or representative of Authority shall be personally liable to Lessee, or any successor in interest, in the event of any default or breach by Authority or for any amount which may become due to Lessee or success
or or on any obligations under the terms of this Lease.
24.13 Relationship
.
The relationship between the parties hereto shall at all times be deemed to be that of landlord and tenant. The parties do not intend nor shall this Lease be deemed to create a partnership or joint venture.
24.14 Waivers And Amendments
. All waivers of the provisions of this Lease must be in writing and signed by the appropriate authorities of Authority or Lessee. The waiver by Authority of any breach of any term, covenant, or condition herein contained shall not be deemed to be a waiver
of
such term, covenant or condition, or any subsequent breach of the same or any other term, covenant or condition herein contained. The subsequent acceptance of rent hereunder by Authority shall not be deemed to be a waiver of an
y preceding breach of Lessee of any term, covenant or condition of this Lease, regardless of Authority’s knowledge of such preceding breach at the time of acceptance of such rent. Failure on the part of Authority to require or exact full and complete compliance with any of the covenants or conditions of this Lease shall not be construed as in any manner changing the terms hereof and shall not prevent Authority from enforcing any provision hereof.
All amendments or modifications hereto must be in writing and signed by the appropriate authorities of Authority and Lessee.
Lessee’s mortgagee permitted by this Lease shall not be bound by any waiver or amendment to this Lease without Lessee’s mortgagee giving its prior written consent.
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24.15 Non - Merger With AHA . None of the terms, covenants or conditions agreed upon in writing in the AHA and other instruments between the parties to this Lease with respect to obligations to be performed, kept or observed by Lessee or Authority in respect to the Site or any part the reof,
shall be deemed to be merged with this Lease.
24.16 Entire Agreement; Counterparts
.
This Lease sets forth the entire understanding of
the parties with respect to the specific terms set forth in this Lease, but the parties acknowledge that the AHA, Authority Regulatory Agreement and Regulatory Agreement (Density Bonus) are also agreements
by Authority, City and Developer that apply to the Development.. This Lease may be executed in counterparts, each of which and all of which together are one and the same agreement.
24.17 Severability
. If any provision of this Lease or the application thereof to any person or circumstances shall be invalid or unenforceable to any extent, the remainder of this Lease and the application of such provisions to other persons or circumstances shall not be affe cted thereby and shall
be enforceable to the greatest extent permitted by law.
24.18 Recordation
. A short form memorandum of this Lease, in the form attached hereto as Exhibit
“C”
, shall be recorded as required by the AHA.
24.19 Binding Effect . This Lease, and the terms, provisions, promises, covenants and conditions hereof, shall be binding upon and (subject to restrictions on transfer, assignment and subletting herein) shall inure to the benefit of the parties hereto and their respective heirs, legal representatives, successors and assigns.
24.20 Estoppel Certificate
s
.
Each of the parties shall at any time and from time to time, but not more frequently than twice during any calendar year, upon not less than twenty (20) days’ prior notice by the other, execute, acknowledge and deliver to such other party a statement in wr
iting
certifying that this Lease is unmodified and is in full force and effect (or if there shall have been modifications that this Lease is in full force and effect as modified and stating the modifications), and stating whether or not to the knowledge of
the signer of such certificate such other party is in default in performing or observing any provision of this Lease, and, if in default, specifying each such default of which the signer may have knowledge, and such other matters as such other party may r easonably
request, it being intended that any such statement delivered by Lessee may be relied upon by Authority or any successor in interest to Authority or any prospective mortgagee or encumbrancer thereof, and it being further intended that any such sta
tement delivered by Authority may be relied upon by any prospective assignee of Lessee’s interest in this Lease or any prospective mortgagee or encumbrancer thereof. Reliance on any such certificate may not extend to any default as to which the signer of the
certificate shall have had no actual knowledge.
24.21 Force Majeure
. Any construction or repair deadline
obligation in this Lease shall be
extended to the extent performance is delayed due to: war; insurrection; riots; floods; earthquakes; fires; casualties; acts of God; acts of the public enemy; epidemics; pandemics; acts or omissions of another party, or ac
ts or failures to act of City or any other public or governmental agency or entity (excepting that acts or failures to act of Authority shall not excuse performance by Authority).
Notwithstanding anything to the contrary in this Agreement, an extension of time for any such cause shall only be for the period of the enforced delay and shall apply only if notice by the party claiming such extension is sent to the other party within thirty (30) days of the commencement of th
e cause.
Notwithstanding any provision of this Lease to the contrary, the inability to obtain funds for payments, or an allocation by CDLAC or the lack of issuance of the Bonds, or the lack of funding to complete
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the Improvements or the inability to accomplish the provision of water service to the Site (or any potion thereof) shall not constitute grounds of enforced delay pursuant to this Section.
In addition to the foregoing (and without regard to the preceding portion of this Section), the Executive Director shall have the authority, at his discretion, to approve construction and repair deadlines not to exceed a cumulative total of three hundred s ixty (360) days, provided that each such
extension is in writing.
24.22 Quiet Enjoyment
.
Authority does hereby covenant, promise and agree to and with Lessee that Lessee, for so long as Lessee is not in default hereof, shall and may at all times peaceably and quietly have, hold, use, occupy and possess the Site throughout the Term.
24.23 Authority Approvals and Actions
.
Whenever a reference is made herein to an action
or approval to be undertaken by Authority, the Authority Executive Director or his or her designee is authorized to act on behalf of Authority unless specifically provided otherwise or the law otherwise requ
ires.
24.24 No Third Parties Benefited Except for City and Approved Leasehold Mortgagee; City Option to Acquire Interest of Authority
.
This Lease is made for the purpose of setting forth
rights and obligations of Lessee and Authority, and no other person
or entity
(except for City) shall
have any rights hereunder or by reason hereof. Except for City, and each leasehold mortgagee approved by Authority, each of which shall be deemed to be a third party beneficiary of this Lease, there shall be no third party benefic
iaries of this Lease. City shall have the authority to enforce this Lease.
City shall have an option to acquire from Authority all interest of Authority in the Site, together with any improvements thereon, upon payment of the sum of One Dollar ($1.00), at any time commencing as of the Date of Agreement and continuing throughout t he Required Covenant Period.
In the event City exercises such option, City shall provide notice thereof to Lessee and to Authority.
The transfer of the Site, together with any improvements thereon, from Authority to City shall not, ipso facto, modify the
rights of Lessee under this Lease (or the rights of Developer under the AHA).
24.25 Lessee’s Limited Partners
. Lessee has advised Authority
that
Wakeland Highland
LLC
, as general partner (the “General Partner”)
shall
be entering into a
n Amended and Restated
Partnership Agreement
for Borrower
(“Partnership Agreement”)
with
a limited partner that will be
investing funds to construct the Project (the “Investor Limited
Partner”)
.
Notwithstanding anything to
the contrary contained in this Lease or the Agreement, the interests of Investor Limited Partner shall be freely transferable and any amendment to Partnership Agreement, to the extent such amendment effectuates such transfers, s
hall not require Authority or City consent; provided that
Lessee or Lessee’s
Investor Limited Partner inform Authority in writing of any such transfers .
(b)
Notwithstanding anything to the contrary contained in this Lease or the Agreement, the removal, or withdrawal in lieu of removal, of Lessee’s general partner(s) for cause in accordance with
the
Partnership Agreement shall not require the consent of Authority and/or City and shall not constitute a default under any of the Lease or the Agreement. If such general partner is removed, or withdraws in lieu of removal, Authority will reasonably consider the admission of a substitute general partner; provided that
(i) the
Investor
Limited Partner submits written evidence
reasonably demonstrating that the substitute general partner has substantial experience operating affordable rental housing projects in California (at least five years’ experience managing at least five
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hundred (500) units, including without limitation the Required Affordable Units, shall be deemed to satisfy the foregoing), and (ii) Authority does not receive written notice that Lessee’s general partner objects to the substitution; provided that if the
Investor
Limited Partner designates itself as the
substitute general partner, Lessor
agrees that
the admission of such substitute general partner shall not be required. Any amendment to Lessee’s Partnership Agreement, to the extent such amendment effectuates such removal and/or withdrawal, and such admission of the substitute general partner shall not require Lessor consent.
(c)
Notwithstanding anything to the contrary contained in this Lease or the Agreement, if a non
-
monetary default or event of default occurs under the terms of this Lease, prior to exercising any remedies thereunder, Lessor will give
L
essee
and its
Investor
Limited Partner written
notice of such default; provided that the failure by Authority to notify the
Investor
Limited Partner
shall not vitiate or negatively affect any notice given to Lessee. If the default is reasonably capable of being cured within thirty
(30) days, Lessee shall have such period to effect a cure prior to exercise of remedies by Lessor under this Lease, or such longer period of time as may be specified in this Lease.
If the default is such that it is not reasonably capable of being cured w ithin thirty (30) days (or such
longer period if so specified), and if Lessee (a) initiates corrective action within said period, and (b) diligently, continually, and in good faith works to effect a cure as soon as possible, then Lessee shall have such add
itional time as is reasonably necessary to cure the default prior to the exercise of any remedies by Lessor
.
IN WITNESS WHEREOF, the parties hereto have caused this Lease to be executed by their lawfully authorized officers.
AUTHORITY
:
HIGHLAND HOUSING AUTHORITY,
a public body, corporate and politic
By:
Carlos Za m a no, Executive Director
LESSEE
:
[ WAKELAND HIGHLAND LP ],
a California limited partnership
By:
[
WAKELAND HIGHLAND LLC
]
, a California
limited liability company, its managing general
partner
By:
WAKELAND HOUSING AND
DEVELOPMENT CORPORATION,
a California nonprofit public benefit corporation
its sole member/manager
By:
Rebecca Louie
President and Chief Executive Officer
Exhibit
“A”
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EXHIBIT A
MAP OF THE SITE
Attached, but in the event of any discrepancy between such map and the legal description attached as Exhibit B, said legal description shall govern and prevail.
To be attached at closing for the applicable Phase and consistent with the terms of the AHA
Exhibit
“B”
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EXHIBIT B
LEGAL DESCRIPTION OF THE SITE
The real property in the City of Highland, County of San Bernardino, State of California, described as follows:
To be attached at Closing for the applicable Phase and consistent with the terms of the AHA
Exhibit
“C”
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EXHIBIT C
FORM OF MEMORANDUM OF LEASE
RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:
Highland Housing Authority
27215 Base Line
Highland, CA 92346
Attention: Executive Director
APNs:
1192-
431-04-
0000 an
d
1192-431
-05
-0000
Exempt from Recording Fee Pursuant to Government Code
Section 27383.
MEMORANDUM OF LEASE
THIS MEMORANDUM OF LEASE (“Memorandum”) is hereby made and dated as of _______ __, 202_ by and between the
HIGHLAND HOUSING AUTHORITY
, a public body,
corporate and politic (the “Authority”), and
[
WAKELAND HIGHLAND LP
]
, a California limited
partnership (the “Lessee”).
RECITALS
A.
Authority and Lessee have entered into an unrecorded ground lease dated as of _______ __, 202_, for that certain parcel of real property (the “Property”) which is legally described in
Addendum
“A”
attached hereto and incorporated herein by reference (the ground lease, as amended is hereafter referred to as the “Lease”). A copy of the Lease is available for public inspection at Authority’s office at 27215 Base Line, Highland, California.
C.
The Lease provides that Lessee shall pay taxes upon the assessed value of the entire Property, and not merely a leasehold interest, as provided pursuant to Section
33673 of the California
Health and Safety Code, to the extent such Section 33673 is applica ble.
NOW, THEREFORE, the parties hereto certify as follows:
Authority, pursuant to the Lease, has leased the Property to Lessee upon the terms and conditions provided for therein. This Memorandum of Lease is not a complete summary of the Lease, and
shall not be used to interpret the provisions of the Lease.
Exhibit
“C”
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HIGHLAND HOUSING AUTHORITY,
a public body, corporate and politic
By:
Carlos Zamano , Executive Director
[
WAKELAND HIGHLAND LP
],
a California limited partnership
By:
[
WAKELAND HIGHLAND LLC
]
, a California
limited liability company, its managing general
partner
By: WAKELAND HOUSING AND
DEVELOPMENT CORPORATION,
a California nonprofit public benefit corporation
its sole member/manager
By:
Name: Rebecca Louie
Title:
President and Chief Executive Officer
Addendum “A” to Exhibit
“C”
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ADDENDUM “A”
LEGAL DESCRIPTION
The real property in the City of Highland, County of San Bernardino, State of California, described as follows:
To be attached at Closing for the applicable Phase and consistent with the terms of the AHA
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A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
STATE OF CALIFORNIA )
) ss.
COUNTY OF ____________
)
On _____________________________ , before me, _______________________________ , Notary Public, (Print Name of Notary Public)
personally appeared
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/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 of Notary Public
OPTIONAL
Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent reattachment of this form.
CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT Individual
Corporate Officer
___________________________________________________________ Title(s)
____________________________________________________________ Title Or Type Of Document
Partner(s) Limited General
Attorney - In - Fact
Trustee(s)
Guardian/Conservator
Other: _____________________________________
Signer is representing:
Name Of Person(s) Or Entity(ies)
___________________________________________________________
___________________________________________________________
____________________________________________________________
Number Of Pages
____________________________________________________________ Date Of Documents
____________________________________________________________ Signer(s) Other Than Named Above
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A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
STATE OF CALIFORNIA )
) ss.
COUNTY OF ____________
)
On _____________________________ , before me, _______________________________ , Notary Public, (Print Name of Notary Public)
personally appeared
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/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 of Notary Public
OPTIONAL
Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent reattachment of this form.
CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT Individual
Corporate Officer
___________________________________________________________ Title(s)
____________________________________________________________ Title Or Type Of Document
Partner(s) Limited General
Attorney - In - Fact
Trustee(s)
Guardian/Conservator
Other: _____________________________________
Signer is representing:
Name Of Person(s) Or Entity(ies)
___________________________________________________________
___________________________________________________________
____________________________________________________________
Number Of Pages
____________________________________________________________ Date Of Documents
____________________________________________________________ Signer(s) Other Than Named Above
Exhibit
“E”
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EXHIBIT “ D ”
GROUND LEASE RIDER
THIS GROUND LEASE RIDER (the “Rider”) is attached to and forms a part of that certain Ground Lease (the “Lease”) by and between the Highland Housing Authority, as lessor (the “Landlord”) and
[
Wakeland Highland LP, a California limited partnership,
]
as lessee (the “Tenant”).
All capitalized terms used herein and not otherwise defined shall have the meanings given that term in the Lease.
1. TENANT’S RIGHT TO MORTGAGE:
1.1 Tenant shall have the right, with Landlord’s prior written consent, which shall not be unreasonably withheld, conditioned or delayed, to mortgage the Lease and Tenant’s leasehold interest by one or more deeds of trust (each, a “Leasehold Mortgage”). No foreclosure (or deed or other transfer in lieu of foreclosure) under any Leasehold Mortgage shall require the consent of the Landlord under, or constitute a breach or default under, the Lease. In the event a Leasehold Mortgagee shall acquire title to Tenant
’s leasehold interest by foreclosure (or deed or other transfer in lieu of foreclosure), such Leasehold Mortgagee may freely assign such leasehold interest to an assignee agreeing unconditionally to be bound by and be subject to the Lease as well as covena
nts of record as to the subject property
after notice to but without the consent of Landlord, and thereupon Leasehold Mortgagee shall be released from all liability for performance or observance of the covenants and conditions in the Lease from and after t
he date of such assignment.
1.2 If Tenant shall mortgage the Lease and Tenant’s leasehold estate hereunder, then Tenant or the holder (each, a “Leasehold Mortgagee”) of such mortgage shall forward to Landlord:
(a)
an executed counterpart of the mortgage or mortgages, in form proper for recording, or, at Tenant’s option, a true copy of such mortgage or mortgages; and (b)
a written notice setting forth the name and address of the holder of such mortgage.
In the event of any assignment of the mortgage or mortgages held by a Leasehold Mortgagee, or change in its name and/or address, the assignee of the Leasehold Mortgagee shall give written notice thereof to Landlord, changing the name of the Leasehold Mortgagee and/or the address to which copies of notices are to be sent.
1.3 Until the time, if any, that each Leasehold Mortgage shall be satisfied of record, or each Leasehold Mortgagee shall give to Landlord written notice that the Leasehold Mortgage held by it has been satisfied:
(a)
no surrender or acceptance of the
d
emised
premises
, or cancellation,
amendment or modification of the Lease, shall be binding upon any Leasehold Mortgagee, or affect any Leasehold Mortgage, if the same is effectuated without the prior written consent of such Leasehold Mortgagee;
Exhibit
“
D
”
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(b) if Landlord shall give any notice of default and/or termination to Tenant under the Lease, Landlord shall, at the same time and in the same manner, give a copy of such notice to each Leasehold Mortgagee at the respective address theretofore designated by
each of them
to Landlord in
writing
; and
(c)
no notice of default and/or termination given by Landlord to Tenant shall be binding upon, or affect, any Leasehold Mortgagee, unless a copy of such notice shall be given to such Leasehold Mortgagee.
1.4 Each Leasehold Mortgagee shall be afforded the right, but not the obligation, to perform any term, covenant, or condition of the Lease to be performed by Tenant, as well as to remedy any default by Tenant hereunder, and Landlord shall accept such performa nce by any Leasehold
Mortgagee with the same force and effect as if furnished by Tenant, provided, however, that the Leasehold Mortgagee shall not thereby or hereby be subrogated to the rights of Landlord. Additionally, Tenant may delegate irrevocably
to any Leasehold Mortgagee(s) the authority to exercise any or all of Tenant’s rights hereunder, including, but not limited to the right of the Leasehold Mortgagee to participate (in conjunction with or to the exclusion of Tenant) in any proceeding, arbitration or settlement involving condemnation or eminent domain affecting Tenant’s leasehold interest in the d
emised
p
remises, but no such delegation shall be binding upon Landlord unless and until either Tenant or the Leasehold Mortgagee in question shall gi
ve to Landlord a true copy of a written instrument
effecting such delegation, in form required for recording. Such delegation of authority may be effected by the terms of a Leasehold Mortgage itself, in which event the service upon Landlord of an executed counterpart or certified copy of the Leasehold Mortgage in accordance with Section 2 of this Rider, together with a written notice specifying the provisions therein that delegate such authority to such Leasehold Mortgagee, shall be sufficient to give Landlord notice of such delegation. Any provision of the Lease that gives a Leasehold Mortgagee the privilege of exercising a particular right of Tenant hereunder on condition that Tenant shall have failed to exercise such right shall not be deemed to diminis
h any privilege that any Leasehold Mortgagee may have, by virtue of a delegation of authority from Tenant, to exercise such right without regard to whether or not Tenant shall have failed to exercise such right. No foreclosure (or deed or other transfer of foreclosure) under any Leasehold Mortgage shall require the consent of Landlord under, or constitute a breach or default under, the Lease.
1.5 If:
(a)
Tenant shall default under the provisions of the Lease and Landlord shall give notice of such default as provided under the provisions of the Lease;
(b)
such default shall not be remedied within any applicable grace and/or cure period pursuant to the provisions of the Lease; and
(c)
Landlord, by reason of such default, shall become entitled to (i) re -
enter the
demised p
remises or the improvement thereon, or (ii) terminate the Lease or (iii) bring a proceeding to dispossess Tenant and/or any other occupants of the
d
emised
p
remises or improvements thereon, re
-
enter the
d
emised
premises and/or improvements thereon and/or terminate the Lease,
Exhibit
“
D
”
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then, before so re - entering the d emised p remises or the improvements, terminating the Lease or commencing such proceeding, and as a condition precedent thereto, Landlord shall:
(d)
give to each Leasehold Mortgagee not less than thirty (30) days additional written notice as to a monetary default (specifying the amount and description thereof to the extent then known to Landlord) or default in furnishing any insurance required to be furnished by Tenant hereunder, or ninety (90) days’ additional written notice of any non
-
monetary default (which shall
specify in detail the nature of such default); and
(e
)
allow each Leasehold Mortgagee:
(i
)
such thirty (30) days or ninety (90) days (as the case may be) within which to cure the default; or
(
ii
)
if such default is a non
-
monetary default (other than a default in
furnishing any insurance required to be furnished by Tenant hereunder) and cannot, with the exercise of due diligence, be cured by such Leasehold Mortgagee within such ninety (90) day peri od, then
provided:
(A
)
prior to the expiration of such ninety (90) day period, such Leasehold Mortgagee has delivered to Landlord an instrument in writing duly executed and acknowledged wherein it agrees to use reasonable efforts to cure such default; and (B)
such default is susceptible of being cured by Leasehold Mortgagee and such Leasehold Mortgagee shall, prior to the expiration of such ninety (90) day period, have commenced curing such default, then such ninety (90) day period shall be extended, as long a s
such Leasehold Mortgagee diligently pursues the curing of such default with continuity, for such period as may be necessary to cure same provided that such period of time shall not be so extended if to do so would subject Landlord to any criminal or c
ivil liability or the cancellation of any insurance required to be maintained by Tenant or the inability to obtain any such insurance.
Nothing herein contained shall affect the right of Landlord, upon occurrence of any subsequent default, to exercise any right or remedy herein reserved to Landlord, subject, however, to the provisions of this Section.
1.6 If:
(a)
Tenant shall default in the performance or observance of any term, covenant, or condition of the Lease on Tenant’s part to be performed or observed, other than a term, covenant or condition requiring the payment of a sum of money; and
(b)
such default is of such a nature that the same either:
(i
)
cannot practicably be cured by a Leasehold Mortgagee without taking possession of the d
emised
premises and/or the improvements thereon; or
Exhibit
“
D
”
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(ii ) is not susceptible of being cured by any Leasehold Mortgagee, then Landlord shall not:
(A
)
re
-
enter the
d
emised
p
remises and/or the improvements thereon
or serve a notice of election to terminate the Lease;
(B)
bring a proceeding to dispossess Tenant and/or any other occupants of the
d
emised
p
remises or the improvements, re
-
enter the
d
emised
p
remises and/or the
improvements and/or terminate the Lease; or
(C)
otherwise terminate the leasehold estate of Tenant hereunder,
(c)
such default is susceptible of being cured by any Leasehold Mortgagee without taking possession of the demised premises and/or the improvements thereon, then the Leasehold Mortgagee shall cure the default within the time permitted to the Tenant to cure (but measured from the time notice of the default is delivered to the Leasehold Mortgagee, it being understood that no such notice need be given unless the Leasehold Mortgagee shall have given Landlord its address for notices and a copy of its
deed of trust, and then the Leasehold Mortgagee’s cure period shall be the same as the Tenant’s);
(iv
)
if the default is of such a nature that same cannot practicably be cured by a Leasehold Mortgagee without taking possession of the d
emised
p
remises and/or the
improvements, a Leasehold Mortgagee shall proceed diligently, subject to any stay in any proceedings involving the insolvency of Tenant or any other person, to obtain possession of the
d
emised
p
remises
and/or the improvements by foreclosure or deed in lieu of foreclosure, and, upon obtaining such possession, shall promptly cure such default; and
(v)
if the default is of such a nature that the same is not susceptible of being cured by any Leasehold Mortgagee, a Leasehold Mortgagee shall institute foreclosure proceedings and diligently prosecute the same to completion, subject to any stay in any procee dings involving the
insolvency of Tenant or other proceeding or injunction (unless, in the meantime, the Leasehold Mortgagee shall acquire Tenant’s estate hereunder, either in its own name or through a nominee, by assignment in lieu of foreclosure).
1.7 No Leasehold Mortgagee shall be required to continue to proceed to obtain possession, or to continue in possession as mortgagee, of the
d
emised
p
remises or the Site Improvements or to
continue to prosecute foreclosure proceedings if and when Tenant’s default shall be cured. Nothing contained in the Lease shall preclude Landlord from exercising any of its rights or remedies with respect to any othe
r default by Tenant during any period of Landlord’s forbearance under the Lease but, in such event, if any Leasehold Mortgagee, any nominee thereof, or any purchaser at a foreclosure sale shall:
(a)
acquire title to Tenant’s leasehold estate hereunder; and
(b)
cure all defaults of Tenant hereunder that are susceptible of being cured by such Leasehold Mortgagee, nominee or purchaser, as the case may be, then the defaults of any prior holder
Exhibit
“
D
”
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of Tenant’s leasehold estate hereunder that are not susceptible of being cured by such Leasehold Mortgagee, nominee or purchaser shall no longer be deemed to be defaults hereunder, provided, however, that nothing herein shall be deemed to relieve such Leas ehold Mortgagee, nominee or
purchaser from the obligation to cure any monetary defaults of Tenant hereunder, as well as all non
-
monetary defaults that are susceptible of being cured by such Leasehold Mortgagee.
1.8 If, for any reason, the Lease shall be terminated prior to the expiration of the Lease ,
Landlord will, on written request of any Leasehold Mortgagee made within thirty (30) days of such termination, enter into a new lease of the
d
emised
p
remises with such Leasehold Mortgagee, within
thirty (30) days after the receipt of such request, for the remainder of the term, effective as of the date of such termination, at the rent, and upon the other terms, covenants and conditions herein contained
in the Lease
and otherwise in a form reasonably acceptable to Landlord acting in good faith, subject, however, to the rights, if any, of the parties then in possession of any part of the d
emised
p
remises,
provided that such Leasehold Mortgagee shall:
(a)
contemporaneously with such written request upon Landlord for such new lease, pay to Landlord the Rent due and payable by Tenant hereunder as of the date of termination of the Lease (which payments shall be specified in reasonable written detail by Landlor
d to the Leasehold
Mortgagee, and such payments shall be held in escrow by Landlord
until such time as Tenant submits
such new lease of the
d
emised
premises to such Leasehold Mortgagee
)
; and
(b)
on or before execution and delivery of said new lease, and as a condition to the execution and delivery thereof by Landlord:
(i)
pay to Landlord:
(A
)
any and all sums which would have been due under the Lease but for such termination from the date of termination of the Lease to the date of execution and delivery of said new lease; and
(B)
any reasonable expenses (including, without limitation, reasonable attorneys’ fees, disbursements and court costs) to which Landlord shall have been subjected by reason of such default;
(ii)
perform and observe all the other covenants and conditions herein contained on Tenant’s part to be performed and observed, to the extent that Tenant shall have failed to perform and observe the same, except that:
(A
)
with respect to any default that cannot be cured by a Leasehold Mortgagee until it obtains possession of the
d
emised
p
remises, the Leasehold Mortgagee shall have a
reasonable time, after the Leasehold Mortgagee obtains possession, to cure such default, provided that such Leasehold Mortgagee shall first agree, in writing, to proceed diligently to remedy such default after
it obtains possession of the
d
emised
p
remises, provided, however, that such extension of time shall not subject Landlord to either civ
il or criminal liability; and
Exhibit
“
D
”
Page
6 of 7
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(B) in no event shall the Leasehold Mortgagee be required to cure a default not susceptible of cure by the Leasehold Mortgagee or its nominee or purchaser
(such as a
breach of a representation)
; and
In the event that more than one Leasehold Mortgagee qualifies to receive a new lease pursuant to the terms of this Section, such new lease shall be entered into with the holder of the Leasehold Mortgagee that is most senior in priority. Upon the execution
and delivery of such new lease, any subleases that
may have theretofore been assigned and transferred to Landlord shall thereupon be assigned and transferred, without recourse by Landlord, to the new tenant; and (c)
return such new lease to Landlord, duly executed and acknowledged, within ten (10) days after receipt thereof from Landlord.
1.9 T
he rights hereunder of the Leasehold Mortgagees shall be exercisable by them in order of priority of lien of their respective Leasehold Mortgages. The liability of any Leasehold Mortgagee acquiring Tenant’s interest hereunder shall be limited to such Leas ehold Mortgagee’s then interest in
the
d
emised
p
remises.
1.10 No Leasehold Mortgagee shall be liable, as tenant, under the provisions of the Lease unless and until such time as it becomes, and then only for as long as it remains, the owner of Tenant’s interest hereunder.
1.11 Notwithstanding anything to the contrary contained in the Lease, all proceeds arising from any casualty insurance, business interruption insurance, rental loss insurance or similar insurance policy relating to the
d
emised
p
remises and/or any improvements now or hereafter located thereon, and all proceeds of any award or payment made in connection with any condemnation or eminent domain proceeding (or deed or other transfer under threat of the same or in lieu thereof) involvi ng all
or any part of the
de
mised
p
remises and/or any improvements now or hereafter located thereon, shall be paid to the Leasehold Mortgagees for application in accordance with their respective Leasehold Mortgages.
1.12 Landlord shall, within thirty (30) days after the written request of any Leasehold Mortgagee:
(a)
acknowledge in writing to them, or to any of them, the receipt by Landlord of any notice or instrument given, sent, or delivered to Landlord pursuant to the provisions of this Article; and/or
(b)
furnish to them, or to any of them, a written statement, duly acknowledged, of
the following items:
(i)
amounts by Lessee to Landlord under the
Lease;
(ii)
whether the fire and other insurance required by the Lease have been supplied in compliance therewith;
Exhibit
“
D
”
Page
7 of 7
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(iii) whether the Lease is unmodified and in full force and effect (or, if there have been modifications, that the same are in full force and effect as modified and stating the modifications);
(iv)
whether, to the knowledge of Landlord, Tenant is in default, specifying the nature of any known default and any pertinent facts with respect thereto; and (v)
whether Landlord has given Tenant any notice of default under the lease, and if given, whether the default set forth therein remains uncured.
Any such statement shall be for the sole benefit of the Leasehold Mortgagee and shall have no effect, as an estoppel or otherwise, with respect to any third party.
Attachment No. 8
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ATTACHMENT NO. 7
Intentionally Blank
.
Attachment No. 8
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ATTACHMENT NO. 8
FORM OF
REQUEST FOR NOTICE OF DEFAULT
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
Highland Housing Authority
27215 Base Line
Highland, California 92346
Attention: Executive Director
APN(s):
SPACE ABOVE THIS LINE FOR RECORDER’S USE ONLY
Exempt from recording fees pursuant to Government Code
§
6103
and §
27383
.
Request for Notice Under Section 2924b Civil Code
In accordance with
Section
2924b, Civil Code, request is hereby made that a copy of any Notice of Default and a copy of any Notice of Sale under the Deed of Trust recorded as Instrument No.
_____
on _____________, 20
2 __, in Book ______, Page ______, Official Records of
San Bernardino
County, California, and describing land therein as
See Exhibit
A attached hereto
executed by ________________________, as Trustor, in which ______________________ is named as Beneficiary, an
d ____________________________ as Trustee, be mailed to
HIGHLAND
HOUSING AUTHORITY
, at 27215 Base Line
,
Highland
, California
92346
, Attention: Executive
Director.
NOTICE:
A COPY OF ANY NOTICE OF DEFAULT AND OF ANY NOTICE OF SALE WILL BE SENT ONLY TO THE ADDRESS CONTAINED IN THIS RECORDED REQUEST.
IF YOUR ADDRESS CHANGES, A REQUEST MUST BE RECORDED.
Carlos Zamano, Executive Director
Date: __________________
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A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
STATE OF CALIFORNIA )
) ss.
COUNTY OF ____________
)
On
_____________________________
, before me,
_______________________________ , Notary Public,
(Print Name of Notary Public)
personally appeared
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/the
ir 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 of Notary Public
OPTIONAL
Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent reattachment of this form.
CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT Individual
Corporate Officer
___________________________________________________________ Title(s)
___________________________________________________________ Title Or Type Of Document
Partner(s) Limited General
Attorney - In - Fact
Trustee(s)
Guardian/Conservator
Other: _____________________________________
Signer is representing:
Name Of Person(s) Or Entity(ies)
___________________________________________________________
___________________________________________________________
___________________________________________________________
Number Of Pages
___________________________________________________________ Date Of Documents
___________________________________________________________ Signer(s) Other Than Named Above
Attachment No. 9
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ATTACHMENT NO. 9
SCOPE OF IMPROVEMENTS
PHASE 1
(Brackets indicate the Single Phase Project and Phase 1 of
the Two
-Phase Project alternatively)
I.
GENERAL DESCRIPTION
The Site is specifically delineated on the Map of the
Site
and
shall be further described in
the
Legal Description of the
Site
.
II.
DEVELOPMENT
Developer shall construct
[ninety(90)][
sixty (60
])
rental housing units on
the
Phase 1
Site
(which includes one manager’s unit), together with all on
-
site and off
-
site features described in this
Scope of
Improvements
(Phase 1)
(as presented to the City Council of the City
and Board of the
Housing Authority
in connection with the consideration of this Agreement
),
including without
limitation landscaping. All such improvements collectively constitute the “ Phase 1
Site
Improvements.”
The bedroom count per unit shall be as follows: [(i) seventy
-
seven (77) one bedroom units and
(ii) thirteen (13) two bedroom units][
(i)
fifty
-
two (52)
one bedroom units;
and
(ii)
eight (8)
two
bedroom units
].
Certain site and offsite improvements shall be accomplished concurrent with the
Phase 1
Site
Improvements as hereafter approved by City pursuant to application of its land use and planning review processes
, as applicable
. The
Phase 1
Site
Improvements and such additional improvements to the
Phase 1
Site
and such offsite prepayments as required as part of the
land use approvals and entitlements
for Phase 1
together constitute the “
Phase 1
Improvements
.”
The construction
of the Phase 1 Improvements shall be of a high
quality
. The
Phase 1
Improvements
shall conform to the Design
Improvements
Drawings
for the Phase 1 Improvements
(the “Approved Plans”).
All development on the Phase 1 Site shall conform to land use approvals to be made hereafter by the City acting in its governmental capacity; the approval of this Agreement does not indicate prior approval of
the Phase 1
plans by the City.
Developer
shall commence and complete the
Phase 1
Improvements
by the respective times
established therefor in the Schedule of Performance
for Phase 1.
III.
DEVELOPMENT STANDARDS
The
Phase 1
Improvements
shall conform to all applicable state laws and regulations and to local zoning, applicable provisions of the City Code and the following development standards:
Attachment No. 9
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A. General Requirements:
1. Vehicular Access.
The
following shall apply to the design of
Phase 1
.
The
placement of vehicular driveways shall be coordinated with the needs of proper street traffic flow as approved by City. In the interest of minimizing traffic congestion, City will control the number and location of curb breaks for access to the
Site
for off
-
street parking and truck loading. The planning for
vehicular areas shall specifically address the use of bicycles. All access driveways shall require written approval of City staff.
2. Building Signs.
Signs
for Phase 1
shall be limited in size, subdued and
otherwise designed to contribute positively to the environment. Signs identifying the building use
in
Phase 1
will be permitted, but their height, size, location, color, lighting and design will be subject to City staff approval, and signs must conform to the City Code.
3. Screening.
All outdoor storage of materials or equipment
for Phase 1
shall be
enclosed or screened to the extent and in the manner required by City staff.
4. Landscaping.
Developer
shall provide and maintain landscaping within the
Phase 1
Site, including the public rights
-of-
way and within setback
s
a
long all street frontages and
conforming with the plans as hereafter approved by City. Landscaping
for Phase 1
shall consist of
trees, shrubs and installation of an automatic irrigation system adequate to maintain such plant material.
The type and size of trees to be planted
as part of Phase 1, together with a landscaping plan, shall be subject to City staff approval prior to planting.
5. Utilities.
All utilities on the
Phase 1
Site sha
ll be underground at De
veloper’s
expense
, unless otherwise approved by the City
.
6. Building Design.
Buildings shall be constructed such that the
Phase 1
Improvements
shall be of high architectural quality and shall be effectively and aesthetically designed and in conformance with City approvals.
B.
Design Features:
The following design features are considered essential components to the Phase 1
Improvements
:
Handicapped Uni
ts
-
Units within
the
Phase 1
Site
are to be fully handicapped
accessible
or adaptable
in compliance with State Housing Code -
Title
24 requirements.
Security
-
The details of security will be reviewed upon submission of the detailed
plans
for Phase 1
.
Overall Design Quality, Materials, Colors, Design Features
-
Quality of design is
important, materials and colors are to be approved by City.
Housing Type
–
Site
: Rental housing for occupancy consisting of [ninety (90) units] [sixty (60) u
nits
].
Attachment No. 9
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Mobility/Agility - All facilities on the Phase 1 Site shall comply, to the extent feasible, with those portions of Title
24 of the California Code of Regulations that have been adopted by HCD relating to handicapped units, and the requirements of the federal Department of Housing and Urban
Development
,
as applicable, including the accessibility provisions of the Federal Fair Housing Act, as amended.
IV.
DEMOLITION AND SOILS
Developer
assumes all responsibility for surface and subsurface conditions at the
Phase 1
Site
,
and the suitability of the
Phase 1
Site
for the
Phase 1
Improvements
.
Developer
has undertaken or will
undertake prior to the Close of Escrow for Phase 1 all investigation of the
Phase 1
Site
as it shall deem
necessary and has not received or relied upon any representations of Authority, City, or their respective officers, agents and employees.
Attachment 10
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ATTACHMENT NO. 10
[
INTENTIONALLY OMITTED]
Attachment No. 11
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ATTACHMENT NO. 11
FORM OF
AUTHORITY REGULATORY AGREEMENT
RECORDING REQUESTED BY ,
AND WHEN RECORDED
RETURN TO:
Highland Housing Authority
27215 Base Line
Highland, California 92346
Attention: Executive Director
with a copy to:
Wakeland Highland
LP
1230 Columbia St., Suite 950
San Diego, CA 92101
APN(s):
(Space above for Recorder’s Use.)
This document is exempt from the payment of a recording fee under Government Code Sections 6103 and 27383.
AUTHORITY REGULATORY AGREEMENT
(Brackets indicate the Single Phase Project and Phase 1 of
the Two
-
Phase Project alternatively)
THIS
AUTHORITY
REGULATORY AGREEMENT
(“
Regulatory Agreement
”
)
is dated as
of ______________, 202__ and is entered into by and between the
HIGHLAND HOUSING
AUTHORITY
, a public body, corporate and politic (“Authority”), and
[
WAKELAND
HIGHLAND
,
L.P
.,]
a
California limited partnership (“Developer”).
R E C I T A L S
WHEREAS
, Authority, City
,
and Developer [or Developer’s predecessor in interest]
have
entered into that certain unrecorded
Amended and Restated
Disposition and Development/Affordable
Housing Agreement dated as of _____________ 202
6 (the “AHA”) for the improvement and
development of the real property described in Exhibit
“A” (the “Phase 1
Site”).
The AHA provides
for the recordation of this Regulatory Agreement.
WHEREAS
,
the AHA also requires that, prior to the recordation of this Regulatory Agreement, Developer shall have entered into a lease of the Phase 1
Site with Authority as lessor
(“
Phase 1
Ground Lease”) and record a Memorandum of Lease for the Phase 1
Ground Lease.
The
Attachment No. 11
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AHA also requires that Developer enter into and record this Regulatory Agreement with the Authority which is required due to the grant of low income set aside funds and other funds by the Authority for the
Phase
described in and required by the AHA.
WHEREAS
, Authority
and Developer wish to adopt this Regulatory Agreement to further govern the use of
the
Phase 1
Site
in conjunction and along with the
AHA
and to ensure that Authority
achieves credit for production of affordable housing units in the manner described by Section
33413
of the California Health and Safety Code.
NOW, THEREFORE
, Authority and Developer desire that the
Phase 1
Site shall be held,
transferred, encumbered, used, sold, conveyed, leased and occupied subject to this Agreement, which shall run with the land and be binding on the parties hereto and their successors, assigns, and successors
-
in
-interest to all or any portion of or interest in the
Phase 1
Site.
ARTICLE I
DEFINITIONS
The definitions provided herein shall be applicable to this Regulatory Agreement
and also to
any amendment or supplemental
Regulatory Agreement
(unless the context implicitly or explicitly
shall prohibit), recorded against
the Site
pursuant to the provision of this Regulatory Agreement
. Any
capitalized terms not defined herein shall have the respective meanings established therefor by the AHA
.
Section
1. “Affordable Housing Project” means an affordable housing project operated in conformity with this Regulatory Agreement throughout the Required Covenant Period.
Section
2. “Affordable Rent” has the meaning
set forth in the AHA.
Section
3. “AHA” is defined in the second recital hereof.
Section
4. “Approved Housing Project” means all improvements as provided to be developed by Developer as the
Improvements
under the
AHA
. The Approved Housing Project must
be completed in strict conformity with all specifications contained in or referred to in the
AHA
.
Section
5. “Area” means the
San Bernardino
Primary Metropolitan Statistical Area, as
periodically defined by HUD.
Section
6. “Authority” means the
Highland Housing Authority
and its successors in
interest.
Section
7. “Base Period” means a period of
68 years commencing as of the
Commencement Date of the Ground Lease.
Section
8. “
Bond Regulatory Agreement
” means the regulatory agreement required to be
recorded against
the Site
in connection with the issuance of Tax Credits.
Section
9. Intentionally Blank.
Section
10. “Certificate” or “Certification” is defined in Section 3(a).
Attachment No. 11
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Section 11. “City” is defined in the first recital hereof.
Section
12. “City Code” means and refers to the City of
Highland
Municipal Code as
revised from time to time.
Section 1
3. “Commencement Date of the Ground Lease” means the commencement of the Ground Lease
as more particularly set forth therein.
Section
14. “
Common Area
” means all areas on the Site that are open or accessible to all tenants of
the Site
(such as grounds but excluding buildings).
Section
15. “Extremely Low Income Households”
is defined in the AHA
Section
16. “Extremely Low Income Unit” means
the
[twenty-
seven (27
)][
six (6)
)]
Unit
s
to be
occupied at Affordable Rent by an Extremely Low Income Household.
Section
17. “Gross Income” means all payments from all sources received by a person (together with the gross income of all persons of the age of 18 years or older who intend to reside with such person in one residential unit) whether in cash or in kind as calculated pursuant to the Department of Housing and
Community
Development
(“
HCD
”) Regulations
.
Section
18. “Ground Lease” means a lease substantially in the f orm of Attachment No. 6
to the AHA.
Section
19. “
Improvements
” has the meaning established therefor in the AHA.
Section
20. “
Low Income Household
”
is defined in the AHA.
Section
21. “
Low Income Unit
”
means the ten (10) units in Phase 1 of the Two
-
Phase
Project to be occupied at an Affordable Rent by a
60% Low Income Household.
Section
22. “Map of
the
Site
” means Exhibit
B hereto.
Section
23. “Median Income for the Area”
“Median Income” shall mean the median gross
yearly income in the County of S
an Bernardino, California, as
used by TCAC in publishing maximum
earnings for 30% Income Households for the County, 50% Income Households for the County and 60% Income Households for the County.
In the event that such income determinations are no longer published, or are not updated for a period of at least eighteen (18) months, the City shall provide the Borrower with other income determinations which are reasonably similar with respect to methods of calculation to those previously published by TCAC.
Section
24. “Prescribed Income Levels”
means
,
[
if Developer elects the Single Phase
Project)
:
for the
forty-
four (
44)
Required Affordable Units:
(i)
for
twenty
-
three (23)
one bedroom
units
and
four (4)
two
-
bedroom units
(
twenty
-
seven (27)
units total)
,
the income earned by a 30%
Income Household for the County as published by TCAC
and
(ii) for
four (4)
two bedroom units and
thirteen (13)
one bedroom units
(
seventeen (17)
units total)
,
the income earned by a 50% Income
Household for the County as published by TCAC
.
[
If Developer elects the Two
-
Phase Project:
for the
twenty
-
nine (
29 )
Required Affordable Units:
four (4) one bedroom units and two (2) two
-bedroom
units (6 total)
,
the income earned by a 30% Income Household for the County as published by TCAC ;
Attachment No. 11
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4105128.2
ten (10) one bedroom units and three (3) two bedroom units (13 total) , the income earned by a 50% Income Household for the County as published by TCAC
;
and t
wo
(2
) one bedroom units and
eight
(8
) two bedroom units (10 total)
,
the income earned by a 60% Income Household for the County as published by TCAC.
Section
25. “Regulatory Agreement” means this Regulatory Agreement and any amendments, modifications or supplements.
Section
26. “Rental Project” means the
[60]
or [90]
Unit residential rental development on
the Site
.
Section
27. “Required Affordable Unit” means any of
[29
of the
60 ] or [44 of the 90]
dwelling units in the Rental Project, as constructed under the AHA
, and available to, occupied by, or
held vacant for occupancy only by tenants qualifying as Extremely Low Income Households , Low
Income Households and
50%
Very Low Income Households conforming to Prescribed Income Levels and rented at Affordable Rent.
Section
28. “Required Covenant Period” means the period commencing on the date this Regulatory Agreement is recorded
and including the Base Period
.
Section
29. “Senior Citizen Household” means
a lawful senior household, in compliance
with
applicable fair housing laws
and California Civil Code Section 51.3.
Section
30. “Senior Citizen Unit” means
all units in the
Rental
Project except the
manager’s unit; all units except the manager’s unit are
restricted to occupancy by a Senior Citizen
Household as provided under th
is
Regulatory Agreement
.
Section
31. “Site” means all of the real property and appurtenances as described in the Recitals above, including all structures and other improvements thereon, and those hereafter constructed.
Section
32. “Unit” means a dwelling unit on the Rental Project.
Section
33. “Very Low Income Unit” means
the
[seventeen (17)]
[
thirteen (13)
]
Unit
s to
be
occupied at Affordable Rent by
a 50% Very Low Income Household.
Section
34. “Year” means a calendar year, excepting that the last Year hereunder shall be deemed to end as of the expiration of this Regulatory Agreement.
Section
35. “50% Very Low Income Households”
or “Very Low Income Households”
is
defined in the AHA
.
ARTICLE II
LAND USE RESTRICTIONS; IMPROVEMENTS
Section
1. Uses.
Developer
shall develop the Approved Housing Project on
the
Site
in
conformity with the
AHA
. Thereafter,
the
Site
shall be operated as an Affordable Housing Project and
devoted only to the uses specified in the
AHA
and the
Ground Lease
for the periods of time specified
herein. All uses conducted on
the
Site
, including, without limitation, all activities undertaken by
Attachment No. 11
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Developer pursuant to the AHA , shall conform to all applicable provisions of the City Code and the City Approvals.
The
Site
shall be used, maintained and operated in accordance with the
AHA
, the
Ground Lease
, and this Regulatory Agreement for the Required Covenant Period. None of the units in the Rental Project shall at any time be utilized on a transient basis nor shall the Rental Project or any portion thereof ever be used as a hotel, motel, dormitory, fra ternity or sorority house, rooming house,
hospital, nursing home, sanitarium, rest home or trailer court or park. No part of the
Site
, from the
date Developer acqu
ired a leasehold interest in
the
Site
, has been or will at any time be owned or used
as a cooperative housing corporation or a community apartment project or a stock cooperative.
Section
2. Affordable Housing.
(a)
Number of Units.
Throughout the Base Period, the Required Affordable Units shall be rented to households with the Prescribed Income Levels
at the
applicable Affordable Rent.
For this purpose, a tenant who qualifies as an Extremely Low Income Household at the time he or she first occupies an Affordable Unit shall be deemed to continue to be so qualified until such time as a recertification of such individual’s or family’s incom
e in accordance with
Section
3 below
demonstrates that such individual or family no longer qualifies as an Extremely Low Income Household. Moreover, a unit previously occupied by an Extremely Low Income Household, and then vacated shall be considered occupied by such Extremely Low Income Household until reoccupied, other than for a temporary period,
at which time the character of the unit shall be redetermined; a similar protocol shall apply with respect
to
50% Very Low Income Households
[
For Phase 1 of the
Two Phase Project only:
or a
60%
Low Income Household]
.
In no event shall such temporary peri
od
exceed thirty-
one (31) days.
(b)
After year 65, rents may be increased as necessary to meet the true debt test.
At such time as a tenant ceases to qualify as an Extremely Low Income Household
or
Very Low Income Household, the unit occupied by such tenant shall cease to be an Extremely Low Income Unit
or Very Low Income Unit
[for Phase 1 of the Two Phase Project only: or a 60% Low Income Household]
,
but Developer will remain in compliance with this Agreement provided that Developer replace
s
each such Extremely Low Income Unit or Very Low Income Unit
[for Phase 1 of
the Two Phase Project only: or a 60% Low Income Household]
, as applicable,
by designating the next
available unit
of the same unit size
and any necessary units
of the same unit size
thereafter as an
Extremely Low Income Unit
or Very Low Income Unit
[for Phase 1 of the Two Phase Project only:
or a 60% Low Income Household]
, as applicable,
except that if more than one tenant of a Required
Affordable Unit ceases to qualify, those tenants who are occupants of Extremely Low Income Units shall have priority for the next available unit(s).
Except to the extent prohibited by federal law
or other regulatory agreements
applicable to the property, in the event a household’s income initially complies with the corresponding income restriction for an Extremely Low Income Household
or Very Low Income Household
[for
Phase 1 of the Two Phase Project only: or a 60% Low Income Household] but the income of such
household increases, such increase shall not be deemed to result in a violation of the restrictions of this Regulatory Agreement concerning limit
ations upon income of occupants.
Duration of Affordability Requirements
. The Required Affordable Units shall be
available to and occupied by Extremely Low Income Households , and Very Low Income Households
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[ for Phase 1 of the Two-Phase Project : and Low Income Households] at Affordable Rent throughout the Required Covenant Period
subject to 2(b) above
.
In addition to providing notice as required by
Government Code Section 65863.10, as may be amended from time to time, all tenants residing in any Unit for which rents are limited by virtue of this Regulatory Agreement or pursuant to other regulation during the last two (2) Years of the Required Covenant Period shall be given notice by Developer at least once e
very six (6) months prior to the expiration date of this requirement, that the rent payable on such Unit may be raised to a market rate rent at the end of the Required Covenant Period.
Selection of Tenants
. As specified hereinbelow, Developer shall demonstrate to Authority that the proposed tenants of each of the Required Affordable Units constitutes an Extremely Low Income Household or
Very Low Income
Household
[for Phase 1 of the Two Phase Project only:
or a 60% Low Income Household].
Senior Housing
.
Developer shall operate the property as lawful senior housing
and in
compliance with California Civil Code Section 51.3.
Prior to the rental or lease of an Required Affordable Unit to a tenant, and as set forth in this
Section
2 of Article II of this Agreement
, Developer shall require the tenant to execute a written lease and to complete an Income Verification certifying that the tenant(s) occupying the Required Affordable Unit is/are an Extremely Low Income Household or, to the extent provided herein, a 50%
Very Low Income Household
[for Phase 1 of the Two Phase Project only: or a 60% Low Income Household],
and
otherwise
meet(s) the eligibility requirements established for the Required Affordable Unit. Developer shall verify the income of the tenant(s).
Determination of Affordable Rent for the Affordable Units . The Affordable Units shall
be rented or leased at Affordable Rent
(or lower rent) as defined in the AHA. .
Relationship to Tax Credit Requirements
. Notwithstanding any other provision of this
Regulatory Agreement, to the extent that requirements associated with the provision of financing
/grants or tax credits
, other than by
Authority
, are more restrictive with respect to the
requirements applicable to tenant selection, tenant income levels and unit rent levels than as provided in this Regulatory Agreement, whichever is more restrictive in each case, shall control and Developer’s compl
iance therewith shall not b
e a default hereunder.
THE DEVELOPER UNDERSTANDS AND KNOWINGLY AGREES THAT THE
MAXIMUM RENTAL FOR THE AFFORDABLE UNITS ESTABLISHED BY THE
AHA
, THIS
REGULATORY AGREEMENT AND THE
GROUND LEASE
IS SUBSTANTIALLY BEL
OW THE
FAIR MARKET RENT FOR THE UNITS RESTRICTED AS
AFFORDABLE UNITS.
Section
3. Developer Verification and Program Compliance.
Income and Senior Citizen Household
Verification and Certification
; Review Fee.
.
The Authority shall perform an annual Program Compliance review based on the data provided by or acquired from the Developer, as more particularly described below. Developer shall cooperate with the Authority with respect to the annual Program Compliance review. Beginning on
that June
15 which first follows commencement of construction of the Improvements and annually thereafter
, Developer shall pay to Authority a Program Compliance annual review fee equal to
Four
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Thousand Dollars ($ 4,000 ), increasing annually on each anniversary of the date of this Agreement by one percent (1%) (the “Authority Program Compliance Annual Review Fee”).
On that June
15 which first follows commencement of construction of the Improvements
and annually thereafter, Developer shall file with Authority a Certificate in
the
form
attached hereto as Exhibit B
cover
ing
the immediately preceding fiscal year
, and containing all
information described pursuant to Health and Safety Code Section 33418.
Developer will obtain and maintain on file an Income Verification form(s) from each tenant, in the applicable form(s) attached hereto as Exhibit C, including verification that each household is a Senior Citizen Household (for every Unit on the Site other t han the manager’s unit),
dated immediately prior to the initial occupancy of such tenant in the Rental Project.
D
eveloper shall
maintain on file throughout the Required Covenant Period each tenant’s executed lease
and
rental
records for the Rental Project
and the Housing Units. Developer shall maintain complete and accurate records pertaining to the Extremely Low Income Units, the 50% Very Low Income Units
[for Phase 1
of the Two Phase Project only: or a 60% Low Income Household], and any other Units, and will permit any duly authorized representative of
Authority
to inspect the books and records of Developer
pertaining to the Rental Project, including those records pertaining to the occupancy of the Extremely Low Income Units, the 50% Very Low Income Uni
ts,
[for Phase 1 of the Tw
o Phase Project only: or
a 60% Low Income Household]
and any other units.
A
t
Authority
’s request, Developer shall also provide to
Authority
the Income
Verification forms for any such tenant or tenants
.
Developer shall obtain an annual certification from each household of each Unit demonstrating that such household is an Extremely Low Income Household,
or
a 50% Very Low
Income Household, as applicable, and meets the eligibility requirements established for each such Unit.
Developer shall verify the income certification of each tenant household.
In order to comply with this
Section
3, Developer shall
also
submit to
Authority
any
and all tenant income and occupancy certifications and supporting documentation required to be submitted to TCA
C
; provided,
Authority
may request (and Developer shall provide) additional
documentation to assist
Authority
’s evaluation of Developer’s compliance with this Agreement, if determined to be necessary in the
good faith
discretion of the Executive Director, specifically including (without limitation) any documentation or additional certifications that may be necessary to verify compliance with all requirements from all funding sources, and each tenant’s status as to each Required Affordable Unit as a Senior Citizen Household. This requirement is in addition to and does not replace or supersede Developer’s obligation to annually submit the Certificate of Continuing Program Compliance to
Authority
. Further,
Authority
has the right, but not the obligation to monitor
compliance with respect to each tenant household at the Rental Project, and Authority
’s election to
monitor some, but not all, of the Units shall not constitute a waiver of
Authority
’s right to monitor and
enforce compliance with respect to all Units in the future.
Verification of Income of New and Continuing Tenants
. Gross income calculations for
prospective (and continuing) tenants shall be determined in accordance with 25 Cal. Code Regs.
Section
6914. Developer shall verify the income and information provided in the income certification of the proposed tenant as set forth below.
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(a) Developer shall verify the income of each proposed tenant of the Rental Project and by at least one of the following methods as appropriate to the proposed tenant:
(i)
obtain two (2) paycheck stubs from the person’s two (2) most recent pay periods;
(ii)
obtain a true copy of an income tax return from the person for the most recent tax year in which a return was filed;
(iii)
obtain an income verification certification from the employer of the person;
(iv)
obtain an income verification certification from the Social Security Administration and/or the California Department of Social Services if the person receives assistance from such agencies;
(v)
obtain an alternate form of income verification reasonably requested by Authority, if none of the above forms of verification is available to Developer; or
(vi)
as to the Required Affordable Units obtain verification and supporting documentation of the household as a Senior Citizen Household.
Verification Regarding Eligibility of New Tenants
. Developer shall retain
documentation regarding the eligibility of each new tenant household.
Reporting Amounts.
Authority
may be
required by Section
33418 of the California
Health and Safety Code to require Developer to monitor affordability of the Affordable Units and submit the annual reports required by
Section
3 of Article
II of this
Regulatory Agreement
. The
Authority relies upon the information contained in such reports to satisfy its own reporting requirements
and to provide certain information described at
Sections
33080 and 33080.1 of the
California Health and Safety Code. In the event
Developer fails to submit to Authority or its designee
the Certification as required by
Section
3(a), Developer shall be in noncompliance with this Regulatory Agreement. In the event Developer remains in noncompliance for thirty (30) days following receipt of written notice from Authority of such noncompliance under
Sections
3(a) and 3(b) of Article
II
hereinabove, then Developer shall, without further notice or opportunity to cure, pay to Authority Two Hundred Fifty Dollars ($250.00) per Required Affordable Unit for each Lease Y
ear Developer fails to
submit a Certificate covering each and every housing unit on the Site
.
Section
4. Nondiscrimination.
Developer
shall refrain from restricting the rental, sale or
lease of
the
Site
, or any portion thereof, on the basis of race, color, creed, religion, sex, marital status, national origin or ancestry of any person. All such deeds, leases or contracts shall contain or be subject to substantially the following nondiscrimination or no segregation clauses:
(1)
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 any basis listed in subdivision
(a) or (d) of
Section
12955 of the Government Code, as those bases
are defined in
Sections
12926, 12926.1, subdivision
(m) and paragraph
(1) of subdivision
(p) of
Section
12955, and
Sectio
n
12955.2 of the Government Code, in the sale, lease, sublease, transfer, use,
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occupancy, tenure, or enjoyment of the premises herein conveyed, nor shall the grantee or any person claiming under or through him or her, establish or permit any practice or practices of discrimination or segregation with reference to the selection, locat
ion, number, use or occupancy of tenants, lessees,
subtenants, sublessees, or vendees in the premises herein conveyed. The foregoing covenants shall run with the land.”
(2)
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 c onditions:
“That there shall be no discrimination against or segregation of any person or group of persons, on account of any basis listed in subdivision
(a) or (d) of
Section
12955 of the Government
Code, as those bases are defined in
Sections
12926, 12926.1, subdivision
(m) and paragraph
(1) of
subdivision
(p) of
Section
12955, and
Section
12955.2 of the Government Code, in the leasing,
subleasing, transferring, use, occupancy, tenure, or enjoyment of the premises herein leased nor shall the lessee himself or hersel
f, 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 premises
herein leased.”
(3)
In contracts: “There shall be no discrimination against or segregation of, any person or group of persons on account of any basis listed in subdivision (a) or (d) of
Section
12955 of
the Government Code, as those bases are defined in
Sections
12926, 12926.1, subdivision
(m) and
paragraph
(1) of subdivision
(p) of
Section
12955, and
Section
12955.2 of the Government Code, in
the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the premises which are the subject of this Agreement, nor shall the grantee or any person claiming under or through him or her, establish or per
mit any practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subte nants, sublessees, or vendees in
the premises herein conveyed. The foregoing covenants shall run with the land.”
The covenants established in this
Agreement
and the deeds of conveyance for
the
Site
shall, without regard to technical classification and designation, be binding for the benefit and in favor of Authority, its successors and assigns, City and any successor in interest to the
Site
, together with
any property acquired by Developer pursuant to this Agreement, or any part thereof. The covenants against discrimination as set forth in this
Section
4 of Article
II shall remain in effect in perpetuity.
Section
5. Management of the Rental Project.
Management Company/Management Plan
.
Developer has contracted with a management
company or manager
that
may be an affiliate of Developer, to operate and maintain the Site in accordance with the terms of this Agreement (hereinafter “Property Manager” or “Management Company”); the selection and hiring of such management company was subject to, and the selectio
n
of any other manager shall be subject to, approval by Authority Executive Director.
Developer shall submit for the approval of Authority a “Management Plan” which sets forth the duties of the Property Manager.
Maintenance and Repair; Capital Replacement Reserve
. Developer agrees to assume
full responsibility for the management, operation and maintenance of the
Improvements
and the Site
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throughout the Required Covenant Period without expense to Authority , and to perform all repairs and replacements necessary to maintain and preserve the
Improvements
and the Site in good repair, in a
neat, clean, safe and orderly condition reasonably satisfactory to Authority and in compliance with all
applicable laws. Developer agrees that
Authority
shall not be required to perform any maintenance,
repairs or services or to assume any expense in connection with the
Improvements
and the Site.
Developer he
reby waives all rights to make repairs or to cause any work to be performed at the expense of Authority as provided for in
Section
1941 and 1942 of the California Civil Code.
The following standards shall be complied with by Developer and its maintenance staff, contractors or subcontractors:
(1)
Developer shall maintain the
Improvements
, including individual Required
Affordable Units, all common areas, all interior and exterior facades, and all exterior project site areas, in a safe and sanitary fashion suitable for a high quality, rental housing project. Developer agrees to provide uti
lity services, administrative services, supplies, contract services, maintenance, maintenance reserves, and management for the entire project including interior tenant spaces (but not tenant units),
common area spaces and exterior common areas. The services provided by Developer shall include, but not be limited to, providing all common area elec
tricity, gas, water, property, paying
all property
taxes, any and all assessments, maintenance and replacement of all exterior landscaping, and all administration and overhead required for any property manager.
(2)
Landscape maintenance shall include, but not be limited to:
watering/irrigation; fertilization; mowing, edging, and trimming of grass; tree and shrub pruning; trimming and shaping of trees and shrubs to maintain a healthy, natural appearance and safe roa d
conditions and visibility, and optimum irrigation coverage; replacement, as needed, of all plant materials; control of weeds in all planters, shrubs, lawns, ground covers, or other planted areas; and staking for support of trees.
(3)
Clean
-
up maintenance shall include, but not be limited to: maintenance of all private paths, parking areas, driveways and other paved areas in clean and weed
-
free condition;
maintenance of all such areas clear of dirt, mud, trash, debris or other matter w hich is unsafe or
unsightly; removal of all trash, litter and other debris from improvements and landscaping prior to mowing; clearance and cleaning of all areas maintained prior to the end of the day on which the maintenance operations are performed to ensure that all cuttings, weeds, leaves and other debris are properly disposed of by maintenance workers.
(4)
The
Improvements
shall be maintained in conformance and in compliance with the approved construction and architectural plans and design scheme, as the same may be amended from time to time with the approval of Authority.
(5)
All maintenance work shall conform to all applicable federal and state Occupation Safety and Health Act standards and regulations for the performance of maintenance.
(6)
Any and all chemicals, unhealthful substances, and pesticides used in and during maintenance shall be applied only by persons in strict accordance with all governing regulations.
(7)
Parking lots, lighting fixtures, trash enclosures, and all areas shall be kept free from any accumulation of debris or waste materials by regularly scheduled maintenance.
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(8) Capital repairs to and replacement of the Improvements shall include only those items with a long useful life, including without limitation the following:
(a)
Appliance replacement;
(b)
Hot water heater replacement;
(c)
Plumbing fixtures replacement, including tubs and showers, toilets, lavatories, sinks, faucets;
(d)
Air conditioning and heating replacement;
(e)
Asphalt replacement;
(f)
Roofing replacement;
(g)
Landscape tree replacement and irrigation pipe and controls replacement;
(h)
Gas line pipe replacement;
(i)
Lighting fixture replacement; and
(j)
Miscellaneous motors and blowers.
Exterior Building Maintenance
. All exterior, painted surfaces shall be maintained at all times in a clean and presentable manner, free from chipping, cracking and defacing marks. Any such defacing marks shall be cleaned or removed within a reasonable period of time as set forth here in.
Front and Side Exteriors
. Developer shall at all times maintain the front exterior and yard in a clean, safe and presentable manner, free from defacing marks or any disrepair and any visible side exteriors. Developer shall hire maintenance personnel to maintain and/or repair any front exterior or yard or visible side yard and exterior of any lot or building.
Graffiti Removal
. All graffiti, and defacement of any type, including marks, words and pictures must be removed and any necessary painting or repair completed by the later to occur of (i) seventy two (72) hours of their creation or (ii) seventy two (72) hours after notic e to Developer.
Driveways
. All driveways must be paved and maintained with impervious material in accordance with the City Code. In addition, all water must be made to drain freely to the public part of the waterway without any pooling.
Exterior Illumination
. Developer shall at all times maintain adequate lighting in all entrance ways and parking areas. Adequate lighting means outdoor, night lighting designed and installed, which provides no less than one (1.0) foot candles in the parking areas and no less than one and one
-
half (1
-
1/2) foot candles in the walking areas or common areas and no less than 0.2 foot candles at the point of least illumination.
Front Setbacks
. All front setback areas that are not buildings, driveways or walkways shall be adequately and appropriately landscaped in accordance with minimum standards established
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4105128.2
by Authority and shall be maintained by Developer. The landscaping shall meet minimum standards set from time to time by
Authority.
Trash Bins
. All trash shall be collected and placed at all times in an enclosable bin to be placed in a designated refuse/trash bin area. The designated area shall be located so that the bin will, to the extent possible, be readily accessible from the street.
Prohibited Signs
. No sign of any kind shall be displayed to the public view on or from any portion of the Site without the approval of
Authority
and appropriate City departments if any as
required by the City Code.
Gross Mismanagement
. During the Required Covenant Period, and in the event of “Gross Mismanagement” (as defined below) of the
Improvements
,
the Executive Director
shall have
and retain the authority to direct and require any condition(s), acts, or inactions of Gross Mismanagement to cease and/or be corrected immediately, if such condition(s) is/are not ceased and/or corrected after expiration of
60 days from the date of written notice from the Executive Director
.
If
Developer or Property Manager has commenced to cure such Gross Mismanagement condition(s) on or before the
5 0th day from the date of written notice (with evidence of such submitted to the Executive Director), but has failed to complete such cure by the
6 0th day, then Developer shall have an additional
thirty (30) days to complete the cure of Gross Mismanagement condition(s).
For purposes of this Agreement, the term “Gross Mismanagement” means management of the
Improvements
in a manner which violates the terms and/or intention of this Agreement to operate a first quality affordable housing complex, and shall include, but is not limited to, any one or more of the following:
(a)
Leasing to tenants who exceed the prescribed income levels;
(b)
Leasing of a Required Affordable Unit to a household that is not a Senior Citizen Household;
(c)
Subject to fair housing laws, allowing tenants to exceed the prescribed occupancy levels without taking immediate action to stop such overcrowding;
(d)
Under-funding required reserve accounts;
(e)
Failing to submit timely and/or adequate annual reports to
Authority
as
required herein;
(f)
Failing to comply with the
Regulatory Agreement (Density Bonus);
(g)
Failing to comply with this Regulatory Agreement;
(h)
Failing to comply with
any regulatory agreement required in
connection with tax credits;
(i)
Fraud or embezzlement of
Improvements
funds, including without
limitation funds in the reserve accounts
required by the Ground Lease
;
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(j) Failing to fully cooperate with the Highland Police Department or other local law enforcement agency(ies) with jurisdiction over the Improvements
, in maintaining a crime
-
free environment within the Improvements
;
(k)
Failing to fully cooperate with the
Highland
Fire Department or other
local public safety agency(ies) with jurisdiction over the
Improvements
, in maintaining a safe and
accessible environment within the Improvements
; and
(l)
Failing to fully cooperate with the
Highland
Planning and Building and
Safety Department, or other local health and safety enforcement agency(ies) with jurisdiction over the Improvements
, in maintaining a decent, safe and sanitary environment within the Improvements .
Developer is obligated and shall use its best efforts to correct any defects in property management or operations at the earliest feasible time.
Code Enforcement
. Developer acknowledges and agrees that
Authority
and its
employees and authorized agents, shall have the right to conduct code compliance and/or code enforcement inspections of the
Improvements
and the individual dwelling units at the
Improvements
(and not limited to the Required Affordable Units), both exterior and interior, at reasonable times and upon reasonable notice (not less than 48 hours prior notice, except in an emergency) to Developer and/or an individual tenant. If such notic
e is provided by
Authority
representative(s) to Developer,
then Developer shall immediately and directly advise any affected tenant of such upcoming inspection and cause access to the area(s) and/or Units at the
Improvements
to be made available and open for
inspection. Developer shall include express advisement of such inspection rights within the lease/rental agreements for each Unit in the
Improvements
in order for each and every tenant and tenant
household to be aware of this inspection right. The foregoing portion of this Section
5 is without
limitation as to the exercise of police powers by City.
Section
6. Keeping of Animals. No animals of any kind shall be raised, bred or kept on the Site
, except that domesticated dogs, cats or other household pets may be kept by the tenants in the Rental Project at the discretion of Developer and subject to compliance with all laws. However, no animal shall be kept, bred or maintained for any commercial purpose or for fighting purposes. Nothing permitted herein shall derogate in any way the right of Developer to further restrict keeping of pets.
Section
7. Parking of Vehicles. Developer shall not permit the parking, storing or keeping of any vehicle except wholly within the parking areas designated for the Required Affordable Units.
Developer shall not permit the parking, storing or keeping of any large c ommercial type vehicle (dump
truck, cement mixer truck, oil or gas truck, etc.), or any recreational vehicle over twenty (20) feet in length (camper unit, motor home, trailer, mobile home or other similar vehicle), boats over twenty (20) feet in
length, or any vehicle other than a private passenger vehicle, upon any portion of the
Common
Area
s
, including parking spaces. For purposes of this section, a pickup truck with a pickup bed mounted camper shall be considered a private passenger vehicle; provided however, that no such vehicle shall be used for residential purposes while parked on the pr
emises.
Developer shall not permit major repairs or major restorations of any motor vehicle, boat, trailer, aircraft or other vehicle to be conducted upon any portion of the Common Area, including the parking areas, except for emergency repairs thereto and then on
ly to the extent necessary to enable
movement of the vehicle to a proper repair facility. No inoperable vehicle shall be stored or kept in the Common Area. Developer shall give the vehicle owner not less than four (4) days, nor more than
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seven (7) days’ notice and an opportunity to remove any vehicle parked, stored or kept in violation of the provisions of this
Agreement
. Notice shall consist minimally of a reasonably diligent attempt to personally notify the vehicle owner or alternatively leaving written notice on the subject vehicle. After due notice and opportunity have been given to the vehicle owner, Developer shal l have the right to
remove, at the vehicle owner’s expense, any vehicle parked, stored or kept in violation of the provis ions
of this Agreement
.
Section
8. Maximum Occupancies. No persons shall be permitted to occupy any Apartment within the Rental Project in excess of applicable limit of maximum occupancy set by the City Code and the laws of the State of California.
Section
9. Signs Required. “No loitering” signs will be posted at each building and enforced by
Developer
. “Illegally parked vehicles will be towed” signs in compliance with California Vehicle Code requirements will be posted and enforced by Developer.
Section
10. Fences and Electronic Installations.
Subject to applicable laws
,
D
eveloper
shall not install or knowingly permit to be installed on the exterior of any improvement or building on any fences or any antenna or other television or radio receiving device, excepting satellite dishes having a diameter of eighteen inches (18”) or less, without prior written consent of City. This prohibition shall not prohibit the installation of cable television or subscription wires or receiving devices.
Section
11. Structural Change. Nothing shall be done on
the
Site
in, on or to any building
which would materially structurally change the exterior or the interior bearing walls of any such building or structure, except as otherwise provided herein. Nothing herein shall affect the rights of Developer to repair, alter or construct improvements on the buildings on the
Site
unless such repair,
alteration or improvement would impair the structural integrity and/or exterior appearance of said buildings. Nothing herein shall be deemed to prohibit work ordered to be performed by the City building official
. Nothing herein shall prevent developer from altering the color or finishes or other exterior of the Improvements, provided such exterior complies will applicable law..
Section
12. Compliance with Laws. Developer shall comply with all applicable laws in connection with the development and use of
the
Site
, including without limitation the California
Community Redevelopment Law (Health and Safety Code
Section
33000,
et
seq
.
) and Fair Housing
Act (42 U.S.C. §
3601,
et
seq
.,
and 24
C.F.R. § 100.300,
et
seq
.)
.
Developer is a sophisticated party,
with substantial experience in the acquisition, development, financing, obtaining financing for, marketing, and operation of affordable housing projects, and with the negotiation, review, and preparation of agreements and other documents in connection with such activities.
Developer
is
familiar with and has reviewed all laws and regulations pertaining to the acquisition, development and
operation of the Rental Project and has obtained advice from any advisers of its own choosing in connection with this Agreement.
ARTICLE I
II
OBLIGATION TO MAINTAIN, REPAIR AND REBUILD
Section
1. Maintenance by Developer.
Developer
shall, at its sole cost and expense,
maintain and repair
the Site
and the improvements thereon keeping the same in a decent, safe and sanitary manner, in accordance with all applicable City Code and Uniform Code provisions.
Developer
shall also maintain the landscaping required to be planted in a healthy condition. If, at any time, Developer fails to maintain the Rental Project or any portion thereof, and said condition is not corrected
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after the expiration of forty - five (45) days from the date of written notice from Authority, either Authority or City may
, in addition to all other rights and remedies, and in its/their sole and absolute discretion,
perform the necessary maintenance and Developer shall pay such costs as are reasonably incurred for such maintenance. Payment shall be due within fifteen (15) days of receipt of an invoice from Authority or City.
Developer
shall also be responsible to cause maintenance of
the Site
and
improvem
ents thereon to conform to the
Bond Regulatory Agreement
(if any)
.
Section
2. Damage and Destruction Affecting Project
-
Developer’s Duty to Rebuild. If
all or any portion of
the
Site
and the improvements thereon is damaged or destroyed by fire or other casualty, it shall be the duty of Developer to
demolish,
rebuild, repair or reconstruct said portion of
the
Site
and/or the improvements in a timely manner which will restore it to Code compliance condition.
In furtherance of the requirements of this
Section
2, Developer shall keep the construction on
the
Site
insured by carriers at all times satisfactory to Authority against loss by fire and such other hazards, casualties, liabilities and contingencies as included within an all risk extended coverage hazard insurance policy, in an amount of the full replacement cost of the constructions. In the event of loss, Developer shall give prompt notice to the insurance carrier and to Authority.
If
the
Site
is abandoned by Developer, or if Developer fails to respond to Authority within thirty (30) days from the date notice is mailed by Authority to Developer that the insurance carrier offers to settle a claim for insurance benefits, Authority is authorized t o collect and apply the
insurance proceeds at Authority’s option either to restoration or repair of
the
Site
.
Section
3. Variance in Exterior Appearance and Design. In the event the Rental Project sustains substantial physical damage due to a casualty event, Developer may apply to City for approval to reconstruct, rebuild or repair in a manner which will provide
a materially
different exterior
appearance and lot design from that which existed prior to the date of the casualty.
Section
4. Timeline for Rebuil
ding.
Upon damage to the Site or the Rental Project or
other improvements, Developer shall be obligated to proceed with all diligence and commence reconstruction within two (2) months after the damage occurs and complete reconstruction within six (6) months afte
r damage occurs, unless prevented by causes beyond their reasonable control, in which event reconstruction shall be commenced and completed at the earliest feasible time.
ARTICLE V
ENFORCEMENT
Section
1. Remedies
.
Breach of the covenants contained in the Regulatory Agreement
may be enjoined, abated or remedied by appropriate legal proceeding by Authority or City
, and shall
constitute a default under the loan by Authority to Developer. This
Regulatory Agreement
does not in
any way infringe on the right or duties of City to enforce any of the provisions of the City Code including, but not limited to, the abatement of dangerous buildings.
City
is
a third party beneficiary of this Regulatory Agreement. Except for City, there shall be no other
third party beneficiaries of this Regulatory Agreement.
Section
2. Nuisance. The result of every act or omission whereby any of the covenants contained in this
Regulatory Agreement
are violated in whole or in part is hereby declared to be and constitutes a nuisance, and every remedy allowable at law or equity, against a nuisance, either public
Attachment No. 11
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or private, shall be applicable against every such result and may be exercised by any owner or its successors in interest, without derogation of City’s rights under law.
Section
3. Right of Entry. In addition to the above general rights of enforcement, City shall have the right through its agents and employees, to enter upon any part of the
Site
for the purpose
of enforcing the California Vehicle Code, and the ordinances and other regulations of City, and for maintenance and/or repair of any or all publicly owned utilities. In addition, City has the right of entry at reasonable hours and upon and after reasonable attempts to contact Developer, on any lot to effect emergency repairs or maintenance which Developer has failed to perform. Subsequent to sixty (60) days written notice to Developer specifically outlining Developer’s noncompliance, City
shall have
the right of entry on
the Site
at reasonable hours to enforce compliance with this
Agreement
which
Developer has failed to perform. The Authority shall additionally have rights of entry as a landlord under the
Ground Lease
.
This
Section
3 is without limitation as to the exercise of police powers of City.
Section
4. Costs of Repair. The costs borne by City or Authority of any such repairs or maintenance emergency and/or non
-
emergency, shall become a charge for which Developer shall be responsible.
Section
5. Cumulative Remedies. The remedies herein provided for breach of the covenants contained in this Declaration shall be deemed cumulative, and none of such remedies shall be deemed exclusive.
Section
6. Failure to Enforce. The failure to enforce any of the covenants contained in this
Regulatory Agreement
shall not constitute a waiver of the right to enforce the same thereafter.
Section
7. Enforcement and Nonliability. The City or Authority may from time to time make such efforts, if any, as it shall deem appropriate enforce and/or assist in enforcing this
Regulatory
Agreement
. However, neither Authority nor City will be subject to any liability for failure to affirmatively enforce any provision of this Agreement
.
ARTICLE VI
GENERAL PROVISIONS
Section
1. Covenant Against Partition. By acceptance of its interest in
the Site
, Developer
shall be deemed to covenant for itself and for its heirs, representatives, successors and assigns, that it will not institute legal proceedings or otherwise seek to effect partition of its right and interest in the interest being conveyed to De
veloper, or the burdens running with the land as a result of this Regulatory Agreement.
Section
2. Severability. Invalidation of any one of these covenants or restrictions by judgment or court order shall in no way affect any other provisions which shall remain in all force and effect.
Section
3. Term. This
Agreement
shall run with and bind the interest of Developer in
the
Site
, and shall inure to the owner(s) of any property
subject to this
Agreement
, their
legal
representatives, heirs, successors and assigns, and as provided in Article
VI, Sections
2 and 3, be
enforceable by City
or Authority, for a term equal to the Required Covenant Period as defined in the
Attachment No. 11
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AHA , provided; however, that the covenants regarding nondiscrimination set forth in Section 4 of Article
II of this
Agreement
shall remain in effect for perpetuity.
Section
4. Construction. The provisions of this
Agreement
shall be liberally construed to
effectuate its purpose of creating a uniform plan for the development and operation of rental housing available at Affordable Rent for Extremely Low Income Households,
and
50% Very Low Income
Households [
for Phase 1 of the Two-
Phase Project
, and Low Income Households] in conformity with
the Prescribed Income Levels. The article and section headings have been inserted for convenience only and shall not be considered or referred to in resolving questions of interpretation or construction.
Developer
shall be obligated by this
Agreement
to comply with the provisions hereof, as well
as the
Ground Lease
. In the event of conflict, Developer shall comply with the most stringent requirements, in each case.
Section
5. Amendments. This
Agreement
may be amended only by the written agreement
of Developer
and Authority.
Section
6. Encroachments. None of the rights and obligations of Developer created herein shall be altered in any way by encroachments due to settlement or shifting of structures or any other cause. There shall be valid easements for the maintenance of said encroac hments so long as they shall
exist; provided, however, that in no event shall a valid easement for encroachment be created in favor of Developer if said encroachment occurs due to the willful conduct of said Developer.
Section
7. Notices. Any notice permitted or required to be delivered as provided herein to Developer shall be in writing and may be delivered by certified mail or reputable overnight delivery service. Notice to
Authority
shall
addressed
to the
Executive Director
at 27215 Base Line, Highland,
California 92346
.
Notice to Developer shall be
addressed
to Wakeland
Highland
, L.P., a
California
limited partnership
, 1230 Columbia St., Suite 950, San Diego, California 92101. Notices by overnight delivery shall be
deemed delivered on the next business day after delivery to the messenger service; notices by certified mail shall be delivered on the date of delivery or inability to deliver/refusal to accept shown on the return receipt
. Such addresses may be changed from time to time by notice in writing.
A copy of all notices to Developer will be provided to Developer’s investor limited partner .
Developer shall provide the Executive Director with the name and address of Developer’s investor limited partner at a late
r date
.
The investor limited partner will have the same notice and cure rights as Developer hereunder, provided that the Developer’s investor limited partner will be provided with an additional 30 days cure period beyond that provided to Developer.
A cure by investor limited
partner will be deemed to be a cure by Developer.
Attachment No. 11
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HIGHLAND HOUSING AUTHORITY,
a public body, corporate and politic
By:
Carlos Zamano, Executive Director
WAKELAND HIGHLAND LP,
a California limited partnership
By:
WAKELAND HIGHLAND LLC
,
a California
limited liability company
,
its
managing
general partner
By: Wakeland Housing and Development
Corporation,
a California nonprofit public benefit corporation
its
sole member/manager
By:
Rebecca Louie
President and C
hief
E
xecutive O
fficer
Exhibit “A” to Attachment No. 11
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EXHIBIT A
LEGAL DESCRIPTION OF
THE
PHASE 1
SITE
The real property in the City of Highland, County of San Bernardino, State of California, described as follows:
The real property in the City of Highland, County of San Bernardino, State of California, described as follows:
Parcel A:
ALL THAT PORTION OF THE SOUTHWEST ¼ OF THE NORTHWEST ¼ OF THE NORTHEAST ¼ OF SECTION 5, TOWNSHIP 1 SOUTH, RANGE 3 WEST, SAN BERNARDINO
MERIDIAN, IN THE CITY OF HIGHLAND, COUNTY OF SAN BERNARDINO, STATE OF
CALIFORNIA, ACCORDING TO GOVERNMENT SURVEY, DESCRIB
ED AS FOLLOWS:
COMMENCING AT A POINT IN THE WEST LINE OF THE NORTHEAST ¼ OF SECTION 5, WHICH IS SOUTH 00 05’ WEST 116.1 FEET FROM THE NORTHWEST ¼ CORNER OF THE SOUTHWEST ¼ OF THE NORTHWEST ¼ OF THE NORTHEAST ¼ OF SAID SECTION 5;
THENCE SOUTH 00 05’ WEST ALONG THE WEST LINE OF SAID NORTHEAST ¼ OF SAID SECTION, 120 FEET;
THEN SOUTH 890 59’ 30” EAST 660.5 FEET, MORE OR LESS, TO THE EAST LINE OF THE SOUTHWEST ¼ OF THE NORTHWEST ¼ OF THE NORTHEAST ¼ OF SAID SECTION;
THENCE NORTH 00 02’ 30” EAST ALONG THE EAST LINE OF THE SOUTHWEST ¼ OF THE NORTHWEST ¼ OF THE NORTHEAST ¼ OF SAID SECTION 120 FEET TO A POINT WHICH IS SOUTH 890 59’ 30” EAST FROM THE POINT OF BEGINNING; THENCE NORTH 890 59’ 30” WEST 660.5 FEET, MORE OR LESS, TO THE POINT OF BEGINNING.
SAVING AND EXCEPTING THEREFROM THE WEST 1 ½ RODS THEREOF INCLUDED IN CENTRAL AVENUE.
APN 1192-431-04-0000
Parcel B:
THAT PORTION OF THE WEST HALF OF THE NORTHWEST ¼ OF THE NORTHEAST ¼ OF SECTION 5, TOWNSHIP 1 SOUTH, RANGE 3 WEST, SAN BERNARDINO MERIDIAN, IN
THE CITY OF HIGHLAND, COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA,
ACCORDING TO THE OFFICIAL PLAT THEREOF, DESCR
IBED AS FOLLOWS:
Attachment No. 11
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COMMENCING AT A POINT ON THE WEST LINE OF THE NORTHEAST ¼ OF SECTION 5, WHICH POINT IS SOUTH 00 05’ WEST 236.79 FEET FROM THE NORTHWEST CORNER OF SOUTHWEST ¼ OF THE NORTHWEST ¼ OF THE NORTHEAST ¼ OF SAID SECTION 5, SAID POINT BEING THE SOUTHWEST CORNER OF PARCEL NO. 1 DESCRIBED IN DEED TO A.L. ABBOTT, ET UX, RECORDED IN BOOK 2193 PAGE 325, OFFICIAL R
ECORDS AND
BEING MARKED BY SURVEYOR’S STAKE L.S. 2345;
THENCE CONTINUING SOUTH 00 05’ WEST 136.14 FEET TO THE NORTH LINE OF PARCEL NO. 2 DESCRIBED IN DEED TO LAWRENCE B. NELSON, ET UX, RECORDED IN BOOK 2656 PAGE 193 OFFICIAL RECORDS;
THENCE EAST ALONG THE NORTH LINE OF THE NELSON PROPERTY TO A POINT IN THE EAST LINE OF THE SOUTHWEST ¼ OF THE NORTHWEST ¼ OF THE NORTHEAST ¼ OF SECTION 5, WHICH POINT IS SOUTH 136.6 FEET FROM THE SOUTHEAST CORNER OF THE A.L. ABBOTT PARCEL ABOVE REFERRED TO
;
THENCE NORTH ALONG THE EAST LINE OF THE SOUTHWEST ¼ OF THE NORTHWEST ¼ OF THE NORTHEAST ¼, 136.6 FEET TO A SURVEYOR’S STAKE L.S. 2345, SAID STAKE MARKING THE SOUTHEAST CORNER OF SAID A.L. ABBOTT PROPERTY;
THENCE NORTH 890 59’ 30” WEST 660.5 FEET MORE OR LESS TO THE POINT OF BEGINNING.
EXCEPTING THE WEST 1 ½ RODS THEREOF INCLUDED IN CENTRAL AVENUE.
APN 1192-431-05-0000
Exhibit “B” to Attachment No. 11
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EXHIBIT B
CERTIFICATE OF CONTINUING PROGRAM COMPLIANCE
To be filled out consistent with the Single Phase
Project or Phase 1 of the Two-Phase Project, as
applicable
TO:
Highland Housing Authority
27215 Base Line
Highland, California 92346
Attention: Executive Director
The undersigned, _______________, being duly authorized to execute this Certificate of Continuing Program Compliance (this “Certificate”) on behalf of Wakeland
Highland
, L.P., a
California limited partnership
(the “Developer”), hereby represents and warrants that:
1. He/she has read and is thoroughly familiar with the provisions of the Regulatory Agreement (Density Bonus
Phase 1
) between the Developer and the City of Highland, the
Authority
Regulatory Agreement between the Developer and the Authority, and the
Phase 1
Ground Lease
between the Developer and the Authority.
2. As of the date of this Certificate, the following number of completed residential units at the
Phase 1
Site: (i)
are currently occupied by Extremely Low
Income Households at Affordable
Rent; or (i
i
)
are currently vacant and being held available for occupancy by an Extremely Low
Income
Household and have been so held continuously since the date an Extremely Low
Income Household
vacated such unit, or,
(iii)
are currently occupied by
Very
Low
Income Households at Affordable Rent;
or (i
v)
are currently vaca
nt and being held available for occupancy by an
Ver
y Low
Income Household
and have been so held continuously since the date an
Ver
y Low
Income Household vacated such unit,
[
for Phase 1 of the Two
-
Phase Project:
or (v) are currently occupied by Low Income Households at Affordable rent or (vi) are currently vacant and being held available for occupancy by Low Income Households and have been held so consistently since the date a Low Income Household vacated such uni
t]
with all Affordable Units having been occupied by Senior Citizen Households :
[
for Phase 1 of the
Two
-Phase Project, add in a., b. and c. below "Low Income Households (60%)]
a.
Occupied at an Affordable Rent by
:
i. Extremely Low Income Households (30%) # of Units : ______ , Nos.: ___________
ii.
Very Low Income Households
(50%)
# of Units
: ______
, Nos.:
___________
b.
Vacant but h
eld for occupancy by
:
i. Extremely Low Income Households (30%) # of Units : ______, Nos.: __________
ii.
Very Low Income Households
(50%)
# of Units
: ______, Nos.:
__________
Attachment No. 11
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c . Last occupied by :
i. Extremely Low Income Households (30%) # of Units : _______ , Nos.: _________
ii.
Very Low Income Households
(50%)
# of Units
: _______
, Nos.:
_________
3. At no time since the date of filing of the last Certification of Continuing Program Compliance have less than one hundred percent (100%) of the Required Affordable Units (Phase 1)
as
completed units in the
Phase 1
been occupied by, or been last occupied, or have been available for occupancy by Extremely Low Income Households
and
50% Very Low Income Households at an
Affordable Rent with all such households being Senior Citizen Households.
4. Developer has enclosed with this Certificate, as a material part hereof, a copy of that report most recently tendered to __________ [governmental entity providing assistance]; Developer shall update this Certificate to reflect any update, modification or amendment to the report made to
__________].
5. Developer is not in default under the terms of the Regulatory Agreement.
[
WAKELAND HIGHLAND LP,
a California limited partnership
By: WAKELAND HIGHLAND LLC, a California
limited liability company, its managing general
partner]
By: Wakeland Housing and Development
Corporation,
a California nonprofit public benefit corporation
its sole member/manager
By:
Name: Rebecca Louie
Title:
President and Chief Executive Officer
Exhibit “C” to Attachment No. 11
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EXHIBIT C
INCOME VERIFICATION FORMS
Part I -- General Information
1. Project Location:
2. Landlord’s Name:
Part II -- Unit Information
3. Unit
4. Number of
5. Monthly
6. Number of
Number ____
Bedrooms ___
Rent $_________
Occupants ___
Part III --
Affidavit of Tenant
1. I, , and I, , as applicants for rental of an Apartment Unit at the above
-described location, do hereby represent and warrant as follows:
A.
(My/Our) gross income (anticipated total annual income)
does not exceed thirty percent
(30%)
of the median income for the San Bernardino
-
Riverside Primary Metropolitan
Statistical Area such income levels are established and amended from time to time pursuant to Section
8 of the United States Housing Act of 1937 and published by the State Departme nt of
Housing and Community Development in the California Code of Regulations. (I/We) understand that the applicable median income is $ . The followi ng computation includes
all income (I/we) anticipate receiving for the 12
-
month period beginning on the date (I/we)
execute a rental agreement for an Affordable Unit or the date on which (I/we) will initially occupy such unit, whichever is earlier. I/we c
ertify that I/we meet the requirements of the
senior housing restrictions associated with my housing unit..
Tenant(s)’ Initials
B.
(My/Our) gross income (anticipated total annual income)
does not exceed fifty percent (50%)
of the median income for the San Bernardino-Riverside Primary Metropolitan Statistical Area such income levels are established and amended from time to time pursuant to Section
8 of the
United States Housing Act of 1937 and published by the State Departme nt of Housing and
Community Development in the California Code of Regulations. (I/We) understand that the applicable median income is $_____. The following comp
utation includes all income (I/we)
anticipate receiving for the 12 month period beginning on the date (I/we) execute a rental agreement for an Affordable Unit or the date on which (I/we) will initially occupy such unit, whichever is earlier. I/we certify that I/we meet the requirements of the senior housing restrictions associated with my housing unit..
Tenant(s)’ Initials
Attachment No. 11
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C. For Phase of the Two - Phase Project: My/Our) gross income (anticipated total annual income) does not exceed
sixty
percent (
6 0%)
of the median income for the San Bernardino
-Riverside
Primary Metropolitan Statistical Area such income levels are established and amended from time to time pursuant to Section
8 of the United States Housing Act of 1937 and published by the State Departme
nt of Housing and Community Development in the California Code of Regulations. (I/We) understand that the applicable median income is $_____. The following computation includes all income (I/we) anticipate receiving for the 12 month period beginning on the date (I/we) execute a rental agreement for an Affordable Unit or the date on which (I/we) will initially occupy such unit, whichever is ea
rlier. I/we certify that I/we meet the
requirements of the senior housing restrictions associated with my housing unit..
Tenant(s)’ Initials
D.
All tenants must complete the following:
Monthly Gross Income
(All Sources of Income of All Adult Household Members Must be Listed)
Source Head of
Household
Co-Tenants Total
Gross amount, before payroll
deductions of wages, salaries,
overtime pay, commissions, fees,
tips and bonuses
Interest and/or dividends
Net income from business or from
rental property
Social security, annuities, insurance
policies, pension/retirement funds,
disability or death benefits received
periodically
Payment in lieu of earnings, such as
unemployment and disability
compensation, worker’s
compensation and severance pay
Alimony, child support, other
periodic allowances
Public assistance, welfare payments
Attachment No. 11
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4105128.2
Source Head of
Household
Co-Tenants Total
Regular pay, special pay and
allowances of members of Armed
Forces
Other
Total:
Total x 12 _________________ = Gross Annual Household Income
Note: The following items are
not
considered income: casual or sporadic gifts; amounts specifically for or in reimbursement of medical expenses; lump sum payments such as inheritances, insurance payments (including payments under health and accident insurance and worker’s compensation), capital gains and settlement for personal or property losses; educational scholarships paid directly to the student or educational institution; government benefits to a veteran for education; special pay to a serviceman he
ad of family away from home and under hostile fire; foster child care payments; value of coupon allotments for purpose of food under Food Stamp Act of 1964 which is in excess of amount actually charged the eligible household; relocation payments under Titl e
II of Uniform Relocation
Assistance and Real Property Acquisition Policies Act of 1970; payments received pursuant to participation in the following programs: VISTA, Service Learning Programs, and Special Volunteer Programs, SCORE, ACE, Retired Senior V
olunteer Program, Foster Grandparent Program, Older
American Community Services Program, and National Volunteer Program to Assist Small Business Experience.
2. This affidavit is made with the knowledge that it will be relied upon by the Landlord to determine maximum income for eligibility and (I/we) warrant that all information set forth in this document is true, correct and complete and based upon information (
I/we) deem reliable
and that the estimate contained in paragraph 1 of this Part
III is reasonable and based upon
such investigation as the undersigned deemed necessary.
3. (I/We) will assist the Landlord in obtaining any information or documents required to verify the statements made in this Part III and have attached hereto copies of federal income tax return for most recent tax year in which a return was filed (past two y
ears federal income tax returns
for self-employed persons).
4. (I/We) acknowledge that (I/we) have been advised that the making of any misrepresentation or misstatement in this affidavit will constitute a material breach of (my/our) agreement with the Landlord to rent the unit and will additionally enable the Landlor
d and/or the Highland Housing
Authority to initiate and pursue all applicable legal and equitable remedies with respect to the unit and to me/us.
Attachment No. 11
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(I/We) do hereby swear under penalty of perjury that the foregoing statements are true and correct.
Date Tenant
Date Tenant
Attachment No. 11
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INCOME VERIFICATION
(for employed persons)
The undersigned employee has applied for a rental unit located in a project financed under a multifamily housing program of the City of Highland and the Highland Housing Authority for persons of
E
xtremely
L
ow
Income
and
V
ery
L
ow
I
ncome
[for Phase 1 of the Two Phase Project only: or a
Low Income Household]. 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 permiss
ion 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 a multifamily housing program of the City of Highland and the Highland Housing Authority.
Signature Date
Please send to:
Attachment No. 11
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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
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A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
STATE OF CALIFORNIA )
) ss.
COUNTY OF ____________
)
On
_____________________________
, before me,
_______________________________ , Notary Public,
(Print Name of Notary Public)
personally appeared
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/the
ir 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 of Notary Public
OPTIONAL
Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent reattachment of this form.
CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT Individual
Corporate Officer
___________________________________________________________ Title(s)
___________________________________________________________ Title Or Type Of Document
Partner(s) Limited General
Attorney - In - Fact
Trustee(s)
Guardian/Conservator
Other: _____________________________________
Signer is representing:
Name Of Person(s) Or Entity(ies)
___________________________________________________________
___________________________________________________________
___________________________________________________________
Number Of Pages
___________________________________________________________ Date Of Documents
___________________________________________________________ Signer(s) Other Than Named Above
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A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
STATE OF CALIFORNIA )
) ss.
COUNTY OF ____________
)
On
_____________________________
, before me,
_______________________________ , Notary Public,
(Print Name of Notary Public)
personally appeared
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/the
ir 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 of Notary Public
OPTIONAL
Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent reattachment of this form.
CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT Individual
Corporate Officer
___________________________________________________________ Title(s)
___________________________________________________________ Title Or Type Of Document
Partner(s) Limited General
Attorney - In - Fact
Trustee(s)
Guardian/Conservator
Other: _____________________________________
Signer is representing:
Name Of Person(s) Or Entity(ies)
___________________________________________________________
___________________________________________________________
___________________________________________________________
Number Of Pages
___________________________________________________________ Date Of Documents
___________________________________________________________ Signer(s) Other Than Named Above
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4105128.2
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
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) ss.
COUNTY OF ____________
)
On
_____________________________
, before me,
_______________________________ , Notary Public,
(Print Name of Notary Public)
personally appeared
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/the
ir 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 of Notary Public
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ATTACHMENT NO. 12
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Attachment No. 13
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ATTACHMENT NO. 13
FORM OF DENSITY BONUS AGREEMENT
FOR PHASE 1 ONLY
RECORDING REQUESTED BY:
AND WHEN RECORDED RETURN
TO:
City of Highland
27215 Base Line
Highland, California 92346
Attn: City Manager
with a copy to:
Wakeland Highland
LP
1230 Columbia St., Suite 950
San Diego, CA 92101
APN(s):
(Space above for Recorder’s Use.)
This document is exempt from the payment of a recording fee under Government Code Sections 6103 and 27383.
REGULATORY AGREEMENT
(DENSITY BONUS)
(
Brackets indicate the Single Phase Project and Phase 1 of
the Two
-
Phase Project alternatively
)
This REGULATORY AGREEMENT (DENSITY BONUS) is entered into by and between the CITY OF HIGHLAND, a municipal corporation (“City”) and WAKELAND HIGHLAND, L.P., a California limited partnership (“Developer”).
R E C I T A L S
WHEREAS,
Developer applied for a “density bonus” under Section 16.40.090 of the Highland
Municipal Code (“Code”) and Government Code section 65915 for its proposed
[90][60]
unit
multifamily senior residential rental project (“Affordable Housing Project”) on the site described in Exhibit “A”
(“Site”)
, which is ground leased by Developer from the Highland Housing Authority.
WHEREAS , the City adopted its Resolution No. 2026- ___ on March 10, 2026 granting development incentives and land use waivers requested by Developer in such application in exchange for the restrictions in this Regulatory Agreement (Density Bonus) (“Regulatory Agreement”), which restricts
[
for the Single Phase Project: eighty
-
nine (
89)
of the units as follows: (i)
twenty
-
seven (
27)
units (
twenty
-
three (
23)
one
-
bedroom units and
four
(4)
two
-
bedroom units) are restricted to senior
households who make no more than 30% of Median Income for the Area
(
i.e.
, extremely low income
households); (ii) another twenty - seven ( 27) units ( twenty - three ( 23) one - bedroom and four ( 4) two -
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bedroom units) are restricted to senior households who make no more than 50% of Median Income for the Area
(
i.e.
, very low income households); and (iii) and another
thirty (
35)
units (
thirty
-
one (
31)
one
-
bedroom units and four ( 4 ) two - bedroom units) are restricted to senior households who make no more than 60% of Median Income for the Area
(
i.e.
, low income households).
There will be on
e
unrestricted
manager’s unit ][ for Phase 1 of the Two - Phase Project: fifty - nine ( 59) of the units as follows: (i) six (6) units (four (
4)
one bedroom units and
two (
2)
two bedroom units are restricted to senior households
who make no more than 30% of
Median Income for the Area
(i.e., extremely low income households);
(ii) another
thirteen (
13 )
units
(
eleven (
11)
one bedroom units and
two (
2)
two bedroom units) are
restricted to senior households who make no more than 45% of
Median Income for the Area
; (iii)
another
thirty (
30)
units (
twenty
-
three (
23)
one bedroom units and
seven (
7)
two bedroom units) are
restricted to senior households who make no more than 50% Median Income for the Area ; and (iv)
another
ten (
10 )
units (
two (
2)
one bedroom units and
eight (
8)
two bedroom units) are restricted to
senior households who make no more than 60%
of Median I
ncome for the Area.
There will be one
unrestricted manager's unit
].
WHEREAS
, this Regulatory Agreement is a density bonus housing agreement within the meaning of Title
16, Chapter
16.40, Section 16.40.090 of the Highland Municipal
Code.
This City
Regulatory Agreement shall be recorded in the Official Records of San Bernardino County, California as senior, non
-
subordinate covenants and restrictions. In no event shall these Restrictions be made junior or subordinate to any deed of trust or other documents
providing financing for the construction
or operation of the Affordable Housing
Project
or any other lien or encumbrance whatsoever
on
Developer’s ground leasehold interest in the Site
for the period that this Regulatory Agreement
(Density Bonus) remains in effect.
NOW, THEREFORE
, City and Developer declare that the
Affordable Housing Project and
Developer’s ground leasehold interest in the Site
shall be held, transferred, encumbered, used, sold,
conveyed,
sub
leased and occupied subject to this Agreement, which shall run with the land and be binding on the parties hereto and their successors, assigns, and successors -
in
-
interest to all or any
portion of or interest in the ground lease or the
Site.
ARTICLE I
DEFINITIONS
The definitions provided herein shall be applicable to this
Agreement
and also to any
amendment or supplemental
Agreement
(unless the context implicitly or explicitly shall prohibit), recorded against the Site pursuant to the provision of this Agreement .
Section
1. “Affordable Housing Project” means the Project on the Site that is required to be constructed and
operated in conformity with this Regulatory Agreement throughout the Required Covenant Period.
Section
2. “Affordable Rent” means the maximum rent for an applicable household income level described herein determined under California Health and Safety Code Section 50053(b) and any related regulations, it being understood that rent may be less than such maximum , and
notwithstanding the foregoing,
f
or an Extremely Low Income Household, Affordable Rent means a monthly rent which does not exceed 30% Tax Credit Rent for the applicable unit size in the County as published by TCAC
,
for a 45% Very Low Income Household, Affordable rent means a monthly rent which does not exceed 45% Tax Credit Rent for the applicable unit size in the County as published by TCAC,
f
or a Very Low Income Household, Affordable Rent means a monthly rent which does not
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exceed 50% Tax Credit Rent for the applicable unit size in the County as published by TCAC f or a Low Income Household, Affordable Rent means a monthly rent which does not exceed 60% Tax Credit Rent for the applicable unit size in the County as published by TCAC. The maximum monthly rental amount of the Units shall be adjusted annually upon TCAC’s publication of its Tax Credit Rents as
published by the California Tax Credit Allocation Committee (“TCAC”) for the County of San Berna
rdino (“County”).
Actual
rent charged may be less than the Affordable Rent.
Section
3. “Approved Housing Project” means
the
A
ffordable
H
ousing
P
roject and
related ancillary improvements.
Section
4. “Area” means the San Bernardino Primary Metropolitan Statistical Area, as periodically defined by HUD.
Section
5. “Authority” means the Highland Housing Authority and its successors in interest.
Section
6. “Base Period” means a period of 68 years commencing as of the Commencement Date of the Ground Lease.
Section
7. “Certificate” or “Certification” is defined in
Article II,
Section
3(a).
Section
8. “City” means and refers to the City of Highland, a municipal corporation.
Section
9. “Commencement Date of the Ground Lease” means the commencement of the Ground Lease as set forth therein.
Section
10. “Common Area” means all areas on the Site that are open or accessible to all tenants of the Site (such as grounds, but excluding buildings).
Section
11. “Extremely Low Income Households” means households that, at initial occupancy, earn no greater than the income limit for a 30% Income Household for the County, as published by TCAC.
Section
12. “Extremely Low Income Unit” means a Unit
restricted to
an Extremely Low
Income Household.
Section
13. “Gross Income” means all payments from all sources received by a person (together with the gross income of all persons of the age of 18 years or older who intend to reside with such person in one residential unit) whether in cash or in kind as calculated pursuant to the Department of Housing and Community Development Regulations.
Section
14. “Ground Lease” means
the ground lease by which Developer has a leasehold
interest in the Site
.
Section
15. “Household size appropriate to the Unit,” as used herein, means two persons for each one
-
bedroom Unit (if any), and three persons for each two bedroom Unit.
Section 1
6. “Improvements”
means the improvements on the Site
.
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4105128.2
Section 1 7. “Low Income Household” means households that, at initial occupancy, earn no greater than the income limit for a 60% Income Household for the County as published by TCAC.
Section 1
8. “Low Income Unit” means a unit restricted to a Low Income Household.
Section
19. “Map of the Site” means
Exhibit
“
B
”
hereto.
In the event of a discrepancy
between the map attached hereto as Exhibit “B” and the legal description attached hereto as Exhibit “A” , said legal description shall govern and prevail.
Section 20. “Median Income for the Area” or “Median Income” shall mean the median gross yearly income
in the County of San
Bernardino,
California, as used by TCAC in publishing the
maximum earnings for 30% Income Households for the County, 45% Income Households for the County, 50% Income Households for the County and 60% Income Households for the County.
In the
event that such income determinations are no longer published, or are not updated for a period of at least eighteen (18) months, the City shall pro
vide the
Developer
with other income determinations
which are reasonably similar with respect to methods of calculation to those previously published by TCAC
.
Section 21.
“
Municipal
Code” means and refers to the City of Highland Municipal Code as revised from time to time.
Section
22. “Prescribed Income Levels” means
that
any household
may not make more
than the following income levels
:
[
if the 90
-
unit Single Phase Project
: eighty
-
nine (
89)
of the units as
follows:
(i)
twenty
-
seven (
27)
units (
twenty
-
three (
23 )
one
-
bedroom units and four (
4)
two
-bedroom
units)
a
30%
Income Household as published by TCAC for the County
(
i.e.
,
E
xtremely
L
ow
I
ncome
H ouseholds); (ii) another twenty - seven (27) units ( twenty - three ( 23) one - bedroom and four ( 4) two - bedroom units)
a
50%
Income Household as published by TCAC for the County
(
i.e.
,
V
ery
L
ow
Income H ouseholds); and (iii) and another thirty - five ( 35) units ( thirty - one ( 31) one - bedroom units and
four (
4)
two
-
bedroom units)
a
60%
Income Household as published by TCAC for the County
(i.e.
,
L ow Income H ouseholds). There will be one unrestricted manager’s unit] [ if the 60 - Unit Two-Phase Project
:
fifty
-
nine (
59)
of the units as follows: (i) six (6) units (four (
4)
one bedroom units and
two (
2 )
two bedroom units
a
30%
Income Household as published by TCAC for the County
(i.e., extremely
low income households); (ii) another thirteen (
13)
units (
eleven (
11)
one bedroom units and
two
(2)
two bedroom units)
a
45%
Income
Household as published by TCAC for the County
; (iii) another
thirty (
30)
units (
twenty
-
thr
ee (
23)
one bedroom units and 7 two bedroom units)
a
50%
Income
Household as published by TCAC for the County
; and (iv) another
ten (
10)
units (
two (
2)
one bedroom
units and
eight (
8)
two bedroom units)
a
60%
Income Household as published by T
C
AC for the County.
There will be one unrestricted manager's unit.
Section
23. “Regulatory Agreement” means this Regulatory Agreement and any amendments, modifications or supplements
hereto
.
(The Authority and Developer are parties to a
separate recorded Regulatory Agreement, the terms of which do not affect this Regulatory Agreement with the City.)
Section
24. “Required Affordable Unit
s
” means
the
[89][59]
units
on the Site
that are
restricted by this Agreement
.
Section
25. “Required Covenant Period” means the period commencing on the date this Regulatory Agreement is recorded
and ending at the end of the
Base Period.