1 AMENDMENT TO LOAN DOCUMENTS
OHDC AFFORDABLE HOUSING LOANS EARLY PAYOFF
THIS AMENDMENT TO LOAN DOCUMENTS (“Amendment”) is made as of ___________________ ___, 2023 by and between ORANGE HOUSING DEVELOPMENT CORPORATION, a California nonprofit corporation (“Borrower”) and the CITY OF ORANGE, a municipal corporation and the successor housing agency to the housing assets and functions of the former Orange Redevelopment Agency, a public body corporate and politic (“City”).
BACKGROUND
A. Borrower executed, entered into and delivered to City and the predecessor in interest to City known as the Orange Redevelopment Agency, a public body, corporate and politic (“Agency”), the following promissory notes, agreements, covenants and deeds of trust securing Borrower’s obligations under the promissory notes , agreements and covenants relating to affordable housing projects identified therein and located on various parcels of real property identified therein within the City of Orange, County of Orange and State of California:
1. That certain Affordable Housing Agreement dated as of Februa ry 1, 1996 between Borrower and Agency and related (a) Promissory Note evidencing a loan of Agency funds to Borrower in the amount of $283,930; (b) Declaration of Covenants, Conditions and Restrictions imposing certain affordable housing covenants for a 55 year term; and (c) Deed of Trust securing the loan, the Promissory Note and the obligations of Borrower under said agreement, promissory note and affordable housing covenants (collectively the “Alice Clark Loan Documents”);
2. That certain Rehabilitation Loan Agreement dated as of December 8, 1997 between Borrower, Agency and City and related (a) Promissory Note evidencing a loan of HOME funds to Borrower in the amount of $96,056 ; (b) Agreement Containing Covenants between Borrower and Agency and Agreement C ontaining HOME Program Requirements between Borrower and City imposing certain affordable housing covenants for a 30 year term; and (c) Deed of Trust securing the loan, the Promissory Note and the obligations of Borrower under said agreement, promissory no te and affordable housing covenants (collectively the “Adams I Loan Documents”);
3. That certain Loan and Grant Agreement dated as of August 13, 1998 between Borrower, Agency and City and related (a) Promissory Note evidencing a loan of HOME funds to Borrowe r in the amount of $126,300 ; (b) Agreement Containing Covenants between Borrower and Agency and Agreement Containing HOME Program Requirements between Borrower and City imposing certain affordable housing covenants for a 55 year term; and (c) Deed of Trust securing the loan, the Promissory Note and the obligations of Borrower under said agreement, promissory note and affordable housing covenants (collectively the “Adams II Loan Documents”);
2 4. That certain Affordable Housing Agreement dated as of March 1, 1999 between Borrower and Agency and related (a) Promissory Note evidencing a loan of Agency funds to Borrower in the amount of $30,000 ; (b) Agreement Containing Covenants imposing certain affordable housing covenants for a 55 year term ; and (c) Deed of T rust securing the loan, the Promissory Note and the obligations of Borrower under said agreement, promissory note and affordable housing covenants (collectively the “Adams III Loan Documents”);
5. That certain Loan and Grant Agreement dated as of November 4, 1998 between Borrower, City and Agency and related (a) Promissory Note evidencing a loan of HOME funds to Borrower in the amount of $81,220 ; (b) Agreement Containing Covenants imposing certain affordable housing covenants for a 55 year term ; and (c) Deed of Trust securing the loan, the Promissory Note and the obligations of Borrower under said agreement, promissory note and affordable housing covenants (collectively the “Rose Loan Documents”);
6. That certain Affordable Housing Agreement dated as of December 15, 2000 between the Borrower and the Agency and related (a) Promissory Note evidencing a loan of Agency funds to Borrower in the amount of $862,960 ; (b) Agreement Containing Covenants imposing certain affordable housing covenants for a 55 year term; and (c) Deed of Trust securing the loan, the Promissory Note and the obligations of Borrower under said agreement, promissory note and affordable housing covenants (collectively the “Villa Modena Loan Documents”).
The Alice Clark Loan Documents, the Adams I L oan Documents, the Adams II Loan Documents, the Adams III Loan Documents, Rose Loan Documents, and the Villa Modena Loan Documents are collectively referred to herein, as amended from time to time, as the “ Loan Documents”. The Loan Documents evidence and secure the loans, indebtedness and other obligations of the Borrower to the City established and agreed to therein (as used herein, collectively, if and as defined in the Loan Documents, the “Obligations”). Any initially capitalized terms used in this Amendment without definition shall have the meanings assigned to those terms in the Loan Documents. All deeds of trust and agreements containing housing affordability restrictions were recorded pursuant to the governing agreements listed above as part of the Loan Documents. The Loan Documents are on file in the public records of the City.
B. The various loans of HOME funds as defined and identified in the Loan Documents were made by the City to Borrower pursuant to applicable federal, state and local law an d regulations. The various loans of redevelopment housing funds as defined and identified in the Loan Documents were made by the Agency to Borrower pursuant to the California Community Redevelopment Law and City and Agency ordinances, resolutions and regu lations. By adoption of Resolution No. 10626 of the City Council of the City on January 14, 2012, the City elected to retain, without limitation, all of the affordable housing assets, rights, powers, duties, obligations, liabilities and functions previously performed by the Agency upon the dissolution of the Orange Redevelopment Agency and become the housing successor agency of the Agency by operation of law, including enforcement of affordability covenants, agreements, deeds of trust and promissory notes and performance of related activities, including without limitation the rights and obligations of the former Agency under the Loan Documents. Repayments from Borrower to the City of HOME loan funds under the Loan Documents are retained by the City under applicable law as HOME Program Funds. Repayments from Borrower to the City of Agency loan funds under the
3 Loan Documents are retained by the City as the successor housing agency to the Agency as assets of the Low and Moderate Income Housing Asset Fund (LMIHAF).
C. The Borrower and the City desire to amend the Loan Documents as provided for in this Amendment, so as to provide for and effectuate the Discounted Payoffs on or before the Payoff Date, subject to the terms and conditions of this Amendment.
NOW, THEREFORE, in consideration of the mutual covenants herein contained and intending to be legally bound hereby, the parties hereto agree as follows:
1. Discounted Payoffs. Borrower agrees, on or before 5:00 p.m. on March 23 , 2023 (the "Payoff Date"), to deliver to City Community Development Department, at 300 E. Chapman Avenue, Orange, California 92866 by certified check or wired funds, as directed by the City, the estimated amount of Nine Hundred Seventy-Seven Thousand Six Hundred Thirty-One Dollars and 87/100 ($977,631.87) (the "Discounted Pa yoff Amount"), plus accrued interest in the amount of Four Hundred Eleven Thousand Three Hundred Thirty -Four Dollars and 05/100 ($411,334.05) (the "Accrued Interest"), and provided tha t the Borrower is not in default under the Loan Documents, or any of them, City agrees to accept the Discounted Payoff Amount and the Accrued Interest on or before the Payoff Date as full satisfaction of the repayment of the Loans evidenced and secured by the Loan Documents, calculated as follows:
A. As to the Alice Clark Loan Documents, discounted unpaid principal in the amount of Two Hundred Forty-Four Thousand Five Hundred Ninety-Seven Dollars and 17/100 ($244,597.17) and accrued and unpaid interest in the amount of Seventy- Eight Thousand Four Hundred Ninety-Two Dollars and 83/100 ($78,492.83); B. As to the Adams I Loan Documents, discounted unpaid principal in the amount of Twenty Thousand Seven Hundred Fifty -Three Dollars and 21/100 ($20,753.21) and accrued and unpaid interest in the amount of Two Hundred Seventy -Two Dollars and 30/100 ($272.30);
C. As to the Adams II Loan Documents, discounted unpaid principal in the amount of Thirty-Six Thousand Sixty-Six Dollars and 44/100 ($36,066.44) and accrued and unpaid interest in the amount of Zero Dollars ($0);
D. As to the Adams III Loan Documents, discounted unpaid principal in the amount of Seven Thousand Seven Hundred Ninety -Five Dollars and 07/100 ($7,795.07) and accrued and unpaid interest in the amount of Zero Dollars ($0); E. As to the Rose Loan Documents, discounted unpaid principal in the amount of Thirty-Two Thousand Seven Hundred Twelve Dollars and 48/100 ($32,712.48) and accrued and unpaid interest in the amount of Zero Dollars ($0); and F. As to the Villa Modena Loan Documents, discounted unpaid principal in the amount of Six Hundred Thirty -Five Thousand Seven Hundred Seven Dollars and 50/100 ($635,707.50) and accrued and unpaid interest in the amount of Three Hundred Thirty -Two Thousand Five Hundred Sixty -Eight Dollars and 92/100 ($332,568.92).
2. Upon receipt of the Discounted Payoff Amount and Accrued Interest, City shall deliver to the Borrower (a) the original Note marked "Paid" (or an original executed lost note
4 affidavit if the original Note is unavailable) and (b) a partial satisfaction of the Deed of Trust only as to the payment obligations secured by the Deed of Trust but not as to the performance of affordable housing covenants set forth in recorded affo rdable housing covenants included in the Loan Documents for each of the loans and secured by each of the respective Deeds of Trust; such partial satisfaction to be in a form reasonably approved by Borrower and City consistent with the terms of this Amendme nt; whereupon the Loan Documents shall be deemed to be amended in accordance with the terms and conditions of this Amendment. To the extent that any term or provision of this Amendment is or may be inconsistent with any term or provision in any Loan Document, the terms and provisions of this Amendment shall control.
Nothing in this Amendment shall be deemed to alter, modify and amend in any way any of Borrower’s obligations to comply with and timely perform all of the affordable housing covenants recorded in connection with each of the loans evidenced and secured by the Loan Documents, as described and referred to in Section 1 of this Amendment, and Borrower shall continue to fully perform each and every obligation set forth in each such covenant agreement for the full term originally set forth in each such covenant agreement.
Nothing in this Amendment shall be deemed to alter, modify and amend in any way any of Borrower’s obligations under each of the deeds of trust recorded in connection with each of the loans evidenced and secured by the Loan Documents, as described and referred to in Section 1 of this Amendment, but only insofar as each such deed of trust secures the performance by Borrower of the affordability covenants recorded in connection with t he loan secured by each such deed of trust. In the event the total Discounted Payoff Amount and Accrued Interest are timely received by the City as and when required by this Amendment each deed of trust shall, as of the Payoff Date, no longer secure the r epayment of the amounts due under the promissory notes relating to each such loan.
3. (a) The Existing Borrower hereby certifies that: (a) no Event of Default or event which, with the passage of time or the giving of notice or both, would constitute an Even t of Default, exists under any Loan Document which will not be cured by the execution and effectiveness of this Amendment, (b) no consent, approval, order or authorization of, or registration or filing with, any third party is required in connection with t he execution, delivery and carrying out of this Amendment or, if required, has been obtained, and (c) this Amendment has been duly authorized, executed and delivered so that it constitutes the legal, valid and binding obligation of the Existing Borrower, e nforceable in accordance with its terms. The Borrower confirms that the Obligations remain outstanding without defense, set off, counterclaim, discount or charge of any kind as of the date of this Amendment.
(b) The Borrower hereby certifies that: (a) all of its representations and warranties in the Loan Documents, as amended by this Amendment, are, except as may otherwise be stated in this Amendment: (i) true and correct as of the date of this Amendment, (ii) ratified and confirmed without condition as if made anew, and (iii) incorporated into this Amendment by reference; (b) no Event of Default or event which, with the passage of time or the giving of notice or both, would constitute an Event of Default, exists under any Loan Document which will not be cured by the execution and effectiveness of this Amendment ; (c) no consent, approval, order or authorization of, or registration or filing with, any third party is required in connection with the
5 execution, delivery and carrying out of this Amendment or, if required, has been obtained; and (d) this Amendment has been duly authorized, executed and delivered so that it constitutes the legal, valid and binding obligation of the Borrower, enforceable in accordance with its terms.
4. To induce the City to enter into this Amendment, the Borrower waives and releases and forever discharges the City and its officers, City Council members , attorneys, agents, and employees from any liability, damage, claim, loss or expense of any kind that it may have against the City or any of them arising out of or relating to the Loan Documents and/or the Obligations.
The Borrower further agrees to indemnify and hold the Bank and its officers, City Council members, attorneys, agents and employees harmless from any loss, damage, judgment, liability or expense (including attorneys’ fees) suffered by or rendered against the City or any of them on account of any claims arising out of or relating to the Obligations and/or the Loan Documents, and all of the releases and indemnifications given by Borrower in each and every Loan Document shall continue in full force and effect in accordance with their terms . The Borrower further states that it has carefully read the foregoing release and indemnity, knows the contents thereof and grants the same as its own free act and deed.
5. This Amendment may be signed in any number of counterpart copies and by the parties to this Amendment on separate counterparts, but all such copies shall constitute one and the same instrument.
6. This Amendment will be binding upon and inure to the benefit of the Borrower and the City and their respective heirs, executors, administrators, successors and assigns. This Amendment is personal to Borrower and may not be assigned, encumbered or transferred in any way to any third party without the prior written consent of the City given in the sole and absolute discretion of the City.
7. This Amendment will be interpreted and the rights and liabilities of the parties hereto determined in accordance with the laws of the State of California, excluding its conflict of laws rules.
8. Except as amended hereby, the terms and provisions of the Loan Documents remain unchanged, are and shall remain in full force and effect unless and until modified or amended in writing in accordance with their terms, and are hereby ratified and confirmed. Except as expressly provided herein, this Amendment shall not constitute an amendment, waiver, consent or release with respect to any provision of any Loan Document, a waiver of any default or Event of Default under any Loan Document, or a waiver or release of any of the City’s rights and remedies (all of which are hereby reserved).
9. City and Borrower agree to cooperate and take all steps and sign all documents as reasonably necessary to effectuate the Discounted Payoffs which are the s ubject of this Amendment, including without limitation utilizing an escrow agent reasonably acceptable to both parties hereto and executing commercially reasonable escrow instructions.
6 IN WITNESS WHEREOF , City and Borrower have caused this Amendment t o be executed and delivered by their proper officer(s) respectively thereunto duly authorized as of the date first written above.
“CITY”
CITY OF ORANGE, a municipal corporation
of the State of California
By:
Daniel R. Slater, Mayor
ATTEST:
Pamela Coleman, City Clerk
APPROVED AS TO FORM:
By:
Mary E. Binning, City Attorney
“BORROWER”
ORANGE HOUSING DEVELOPMENT
CORPORATION,
a California nonprofit corporation
By
By