RESOLUTION NO. R-2024-17
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
PLACENTIA, CALIFORNIA, APPROVING THE
DISPOSITION AND DEVELOPMENT AGREEMENT NO.
DDA -2023-01 WITH MERCY HOUSING CALIFORNIA
TRANSFERRING TITLE OF PROPERTIES LOCATED AT
300, 307, 312, 314, AND 323 BAKER STREET TO MERCY
HOUSING CALIFORNIA TO FACILITATE THE FUTURE
DEVELOPMENT OF A FIVE STORY, 68 UNIT
MULTIFAMILY AFFORDABLE HOUSING DEVELOPMENT
WITH ONSITE RESIDENT SERVICES AND
MANAGEMENT, ONSITE PARKING AND A SATELLITE
PARKING SITE ON A 0.77 -GROSS ACRE SITE AND
FINDING THE PROJECT TO BE EXEMPT FROM FURTHER
ENVIRONMENTAL REVIEW AS A CLASS 32 INFILL
CATEGORICAL EXEMPTION
A. Recitals.
(i) The City of Placentia owns real property located at 300 Baker Street (APN 339-392-14), 307 Baker Street (APN 339-392-15), 312 Baker Street (APN 339-391-15), 314 Baker Street (APN 339-391-14) and 323 Baker Street (APN 339-392-19) respectively (the "Properties); and
(ii) The City Council has selected Mercy Housing California ("Buyer"), to purchase the Properties pursuant to the terms of which are set forth in that certain draft instrument entitled "Disposition and Development Agreement" ("DDA") in a form submitted herein (the "Agreement"); and
(iii) The DDA will allow for the future construction of a five -story, 100 percent affordable workforce housing development featuring 68 affordable housing units with associated amenities for residents, onsite resident services, and onsite and satellite parking sites on the subject Properties; and
(iv) The development consists of a total 0.77 -gross acre City -owned site situated at the terminus of Baker Street between Melrose Street and Walnut Street, which abuts the BNSF tracks to the south and is just west of the future platform for Placentia's anticipated Metrolink station; and
(v) The development is the first new affordable housing development in Placentia's Old Town (OT) Zoning District adopted in 2017 and will help fulfill local and regional affordable housing needs, while serving as an additional catalyst bringing further development within the Old Town District and nearby TOD zone; and (vi) The development will assist with the implementation of the City's vision as an area that encourages high quality, transit -oriented development with associated Resolution R-2024-17 ATTACHMENT 2
amenities and to create a compact pattern of development that is conducive to walking, bicycling, and using public transportation; and
(vii) The development is utilizing State density bonus law, as set forth in California Government Code Section 65915, which with the 100% affordable classification, the project is eligible for up to four incentives and concessions, which will be exceeding density, open space and parking requirements, and height; and (viii) All other legal prerequisites to the adoption of this Resolution have occurred.
B. Resolution.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF PLACENTIA DOES HEREBY FIND, DETERMINE AND RESOLVE AS FOLLOWS:
(1.) The City Council hereby finds that the sale of the Properties will assist in the elimination of blight, or provide housing for low- or moderate- income persons in that the properties are either vacant, underdeveloped, or in a state of disrepair, and the sale to private parties will facilitate their redevelopment, revitalization, or reuse, and the sale proceeds will provide funding to expand and preserve housing for low- or moderate - income persons; and
(2.) The City Council hereby approves a Disposition and Development Agreement No. DDA -2023-01 with Mercy Housing California for the subject Properties, herein attached as Exhibit "A" to this Resolution.
(3.) The City Council hereby directs the City Administrator to execute on its behalf all grant deeds and necessary documents and to take all actions necessary under the State law to complete the disposition of the subject Properties. (4.) The City Clerk is directed to record or have recorded the executed grant deeds and all necessary documents to complete the disposition of the subject Properties. (5.) The City Council shall sign this resolution, and the Clerk shall attest and certify to the passage and adoption thereof.
(6.) The City Council declares that, should any provision, section, paragraph, sentence or word of this resolution be rendered or declared invalid by any final court action in a court of competent jurisdiction, or by reason of any preemptive or inconsistent legislation, the remaining provisions, sections, paragraphs, sentences and words of this resolution shall remain in full force and effect.
(7.) The City Council finds the approval of this DDA (the "Project") to be exempt from further review under the California Environmental Quality Acct as the Project is an infill development project of less than 5 acres and meeting all other criteria of CEQA Guidelines 15332, Class 32 Categorical Exemption.
Resolution R-2024-17 ATTACHMENT 2
PASSED, APPROVED AND ADOPTED this 5th day of March 2024.
Jeremy Yamaguchi, Mayor
ATTEST:
Robert S. McKinnell, City Clerk
STATE OF CALIFORNIA
CITY OF PLACENTIA
I, Robert S. McKinnell, City Clerk of the City of Placentia, do herby certify that the foregoing Resolution was adopted at a regular meeting of the City Council of the City of Placentia, held on the 5th day of March 2024 by the following vote:
AYES: Councilmembers:
NOES: Councilmembers:
ABSENT: Councilmembers:
ABSTAINED: Councilmembers:
ATTEST:
Robert S. McKinnell, City Clerk
APPROVED AS TO FORM:
Christian L. Bettenhausen, City Attorney
Exhibit "A"- Disposition and Development Agreement No. DDA -2023-01 Resolution R-2024-17 ATTACHMENT 2
DISPOSITION AND DEVELOPMENT AGREEMENT
NO. DDA -2023-01
by and between
CITY OF PLACENTIA,
a California municipal corporation
and
MERCY HOUSING CALIFORNIA
a California nonprofit public benefit corporation
1 DISPOSITION AND DEVELOPMENT AGREEMENT NO. DDA -2023-01 THIS DISPOSITION AND DEVELOPMENT AGREEMENT (the "Agreement") is dated as of March 5, 2024 ("Effective Date") and is entered into by and between the CITY OF PLACENTIA ("City"), having their offices at 401 E. Chapman Avenue, Placentia, California 92870, and MERCY HOUSING CALIFORNIA, a California nonprofit public benefit corporation ("Developer"), with its principal office located at 1500 S. Grand Ave., Ste. 100, Los Angeles, CA 90015.
RECITALS
A. City is the owner of that certain property in the City of Placentia located at 300/307, 312, 314 and 323 Baker Street, Placentia, California, as more particularly described in Exhibit "A" attached hereto, as well as that certain approximately 5,146 square feet of public street located between 307 W. Baker Street and 312 Baker Street to be dedicated to Developer (the "Land").
B. City acquired the Property as the successor to the non -housing assets of the former Redevelopment Agency of the City of Placentia which was dissolved by operation of law.
C. The purpose of this Agreement is to achieve the development of the Land owned by the City that is more specifically described on Exhibit "A". The Land and the Improvements to be constructed thereon pursuant to the terms of this Agreement are hereinafter collectively referred to as the "Project."
D. Construction of the Improvements, which will consist of a new 68 -unit multi -family affordable housing development, per City of Placentia's Site Plan Review Number 2023-03. The new building and related improvements will provide additional jobs, encourage new investment, provide affordable housing, and otherwise substantially improve the economic and physical conditions in the City of Placentia.
E. Developer will construct and operate approximately 68 rental dwelling units consisting of a mix of one-, two- and three-bedroom units for low-income individuals and families, with household income at 15% to 60% area median income, including approximately twenty (20) units of permanent supportive housing, one (1) unit of which shall be set-aside for the purpose of housing individuals or families from the Homeless Intervention Services of Orange County (HIS OC) Transitional Housing Program.
F. A material inducement to the City to enter into this Agreement is the agreement by Developer to develop the Project as provided herein. 2 AGREEMENT
NOW, THEREFORE, in consideration of the above recitals and of the mutual covenants contained in this Agreement, the parties hereto agree as follows:
1. DEFINITIONS.
1.1 Definitions. The following capitalized terms used in this Agreement shall have the meanings set forth below:
1.1.1 "Agency" means the Placentia Redevelopment Successor Agency.
1.1.2 "Agreement" means this Disposition and Development Agreement.
1.1.3 "Approved Title Exceptions" is defined in Section 2.4.1.
1.1.4 "Building Permit" means, collectively, any and all permits necessary to grade the Land and construct the Project that would be issued by the City.
1.1.5 "Certificate of Completion" means the certificate described in Section 3.12.
1.1.6 "City" means the City of Placentia.
1.1.7 "Close of Escrow" is defined in Section 2.3.
1.1.8 "Construction Contract" is defined in Section 3.3.
1.1.9 "Construction Loan" is defined in Section 3.4.
1.1.10 "Default" is defined in Section 6.1.
1.1.11 "Deposits" is defined in Section 2.2.
1.1.12 "Disapproved Title Exceptions" is defined in Section 2.4.1.
1.1.13 "Escrow" is defined in Section 2.3.
1.1.14 "Escrow Holder" means Fidelity National Title Company or another licensed escrow holder mutually selected by the Parties.
1.1.15 "Feasibility Threshold Funding Program Award" means a commitment to award funds as further described in Exhibit "D". Developer shall apply for all rounds of funding described in Exhibit "D" until the appropriate funding needed to construct the Project is secured by the Developer. This also includes any agreed upon funding source by the Developer and the City that would be applicable to this Project.
1.1.16 "FIRPTA Affidavit" is defined in Section 2.8.1.3.
1.1.17 "Force Majeure Delay" is defined in Section 6.7. 3 1.1.18 "General Contractor" is defined in Section 3.3.
1.1.19 "Good Faith Deposit" means a deposit made by the Developer to the City pursuant to Sections 2.2 and 9 hereof. All Good Faith Deposits shall be held by the City pursuant to the terms and conditions of this Agreement.
1.1.20 "Grant Deed" is defined in Section 2.4.5.
1.1.21 "Hazardous Materials" means any chemical, material or substance now or hereafter defined as or included in the definition of hazardous substances, hazardous wastes, hazardous materials, extremely hazardous waste, restricted hazardous waste, toxic substances, pollutant or contaminant, imminently hazardous chemical substance or mixture, hazardous air pollutant, toxic pollutant, or words of similar import under any local, state or federal law or under the regulations adopted or publications promulgated pursuant thereto applicable to the Land, including, without limitation: the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. 9601, et seq. ("CERCLA"); the Hazardous Materials Transportation Act, as amended, 49 U.S.C. 1801, et seq.; the Federal Water Pollution Control Act, as amended, 33 U.S.C. 1251, et seq.; and the Resource Conservation and Recovery Act of 1976, 42 U.S.C. 6901, et seq. ("RCRA") The term Hazardous Materials shall also include any of the following: any and all toxic or hazardous substances, materials or wastes listed in the United States Department of Transportation Table (49 CFR 172.101) or by the Environmental Protection City as hazardous substances (40 CFR. Part 302) and in any and all amendments thereto in effect as of the Close of Escrow Date; oil, petroleum, petroleum products (including, without limitation, crude oil or any fraction thereof), natural gas, natural gas liquids, liquefied natural gas or synthetic gas usable for fuel, not otherwise designated as a hazardous substance under CERCLA; any substance which is toxic, explosive, corrosive, reactive, flammable, infectious or radioactive (including any source, special nuclear or by-product material as defined at 42 U.S.C. 2011, et seq.), carcinogenic, mutagenic, or otherwise hazardous and is or becomes regulated by any governmental authority; asbestos in any form; urea formaldehyde foam insulation; transformers or other equipment which contain dielectric fluid containing levels of polychlorinated byphenyls; radon gas; or any other chemical, material or substance (i) which poses a hazard to the Land, to adjacent properties, or to persons on or about the Land, (ii) which causes the Land to be in violation of any of the aforementioned laws or regulations, or (iii) the presence of which on or in the Land requires investigation, reporting or remediation under any such laws or regulations.
1.1.22 "Holder" is defined in Section 4.4.
1.1.23 "Improvements" means all buildings, landscaping, infrastructure, utilities, and other improvements to be built on the Land, as described in the Scope of Development.
1.1.24 "Land" means the land described on Exhibit "A" attached hereto.
1.1.25 "North SPA" is defined in Subsection 13.12.2.
4 1.1.26 "Party" means any party to this Agreement, and "Parties" means all parties to this Agreement.
1.1.27 "Permitted Exceptions" is defined in Section 2.4.5.
1.1.28 "Plans and Specifications" means all drawings, landscaping and grading plans, engineering drawings, final construction drawings, and any other plans or specifications for construction of the Project.
1.1.29 "Project" means the Land and Improvements.
1.1.30 "Project Area" is defined in Recital A.
1.1.31 "Project Budget" is defined in Section 2.7.7.
1.1.32 "Purchase Price" is defined in Section 2.1.
1.1.33 "Released Parties" is defined in Section 2.9.4.
1.1.34 "Schedule of Performance" means the schedule on Exhibit "B" attached hereto and incorporated by reference herein.
1.1.35 "Scope of Development" means the description of the Project set forth in Exhibit "C" attached hereto and incorporated by reference herein.
1.1.36 "Site Designs" is defined in Section 6.8.
1.1.37 "Title Company" shall mean the Escrow Holder (i.e., the Title Company and the Escrow Holder are the same).
1.1.38 "Transfer" is defined in Section 4.1.1.
1.1.39 "Transferee" is defined in Section 4.1.2.
1.1.40 "Withholding Affidavit" is defined in Section 2.8.1.2.
2. PURCHASE AND SALE OF THE PROPERTY; PURCHASE PRICE;
DEPOSITS.
2.1 Purchase and Sale: Purchase Price. In accordance with and subject to the terms and conditions hereinafter set forth, the City agrees to sell the Land to Developer, and Developer agrees to purchase the Land from the City. The purchase price for the Land to be paid by Developer (the "Purchase Price") shall be Three Million Two Hundred Thousand Dollars ($3,200,000). Notwithstanding anything to the contrary contained herein, the Close of Escrow shall not occur until such time as the Closing Conditions, as defined in Section 2.5 hereof, have been satisfied. City and Developer shall enter into a Residual Receipts Loan Agreement consistent with the terms set forth in the City Loan Commitment Letter approved by City Council Resolution 2023-41.
5 2.2 Good Faith Deposit. Within ten (10) business days after the date this Agreement is executed by the City and delivered to Developer, the Developer shall deposit the sum of Fifteen Thousand Dollars ($15,000) with Escrow Holder (together with all interest thereon, the "Good Faith Deposit"). The Good Faith Deposit shall be held by Escrow Holder in an interest- bearing account. Unless otherwise set forth in this Agreement, the Good Faith Deposit and all subsequent Good Faith Deposits (collectively, "Deposits") shall be credited to the Purchase Price, or refunded to Developer in Developer's sole discretion, at the Close of Escrow. In the event the Close of Escrow does not occur due to a default by Developer, all Good Faith Deposits shall be delivered to and retained by the City as liquidated damages for such default. DEVELOPER AND
CITY AGREE THAT BASED UPON THE CIRCUMSTANCES NOW EXISTING, KNOWN
AND UNKNOWN, IT WOULD BE IMPRACTICAL OR EXTREMELY DIFFICULT TO
ESTABLISH CITY'S DAMAGES BY REASON OF A DEFAULT BY DEVELOPER PRIOR TO THE CLOSE OF ESCROW. ACCORDINGLY, DEVELOPER AND CITY AGREE THAT
IN THE EVENT OF A DEFAULT BY DEVELOPER PRIOR TO THE CLOSE OF ESCROW,
CITY SHALL BE ENTITLED TO RETAIN THE DEPOSIT, PLUS ANY ACCRUED INTEREST THEREON, AS LIQUIDATED DAMAGES.
2.3 Opening and Closing of Escrow. Within five (5) business days after the Effective Date of this Agreement is executed by City and delivered to Developer, the City and the Developer shall cause an escrow (the "Escrow") to be opened with Escrow Holder for the sale of the Land by the City to Developer. The Parties shall deposit with Escrow Holder a fully executed duplicate original of this Agreement as the escrow instructions for the Escrow. The City and Developer shall provide such additional instructions as shall be necessary and consistent with this Agreement. Provided that each of the conditions to closing described in Section 2.7 have been satisfied, Escrow shall close (the "Close of Escrow") on or before February 29, 2028. If the Close of Escrow does not occur by such date, unless extended by the mutual agreement of the parties, any party not then in default may terminate this Agreement by written notice to the other and all the funds and documents deposited with Escrow Agent shall be promptly refunded or returned, as the case may be, by Escrow Agent to the depositing party, except that all escrow and title cancellation fees shall be paid by Developer. City has no financial obligation of any kind related to pre -development expenses incurred by Developer should termination occur for failure to Close Escrow.
2.4 Condition of Title; Title Insurance.
2.4.1 Developer hereby approves title exceptions for the following certain preliminary title reports:
2.4.1.1 Preliminary Report File Nos. 09195947-919-KRC-KRE ("PTR #1") and 01910643-919-KRC-KRE ("PTR #3"), both dated May 31, 2023 and issued by Commonwealth Land Title Company ("Commonwealth Title"); and
2.4.1.2 Preliminary Report File No. 00188222-996-SD1-CF2, dated January 12, 2023 and issued by Fidelity National Title ("Fidelity Title", and together with Commonwealth Title, the "Title Companies") ("PTR #2"); and 6 2.4.1.3 Preliminary Report File No. 01910645-919-KRC-KRE ("PTR #4"), dated June 1, 2023 and issued by Commonwealth Title.
The City agrees to eliminate, cause to be eliminated or cause the Title Company to reasonably insure over exceptions of such preliminary title report (the "Disapproved Title Exceptions") prior to or concurrently with the Close of Escrow.
2.4.2 At the Close of Escrow, the City shall convey title to the Land to Developer by grant deed substantially in the form attached hereto as Exhibit "E" (the "Grant Deed"). Title to the Land shall be conveyed subject to: (i) non -delinquent current real property taxes and assessments not yet due for the tax year during which the conveyance occurs, (ii) all Approved Title Exceptions, (iii) a Memorandum of Disposition and Development Agreement in the form attached hereto as Exhibit "F", and (iv) any matters which arise out of the actions of Developer or its agents and representatives (collectively, the "Permitted Exceptions").
2.5 Conditions to Close of Escrow. The obligation of the City and Developer under this Agreement to close Escrow shall be subject to the satisfaction (or express written waiver by the benefited party) of each of the following conditions (collectively, the "Closing Conditions"):
2.5.1 There shall have been no change to the physical condition of the Land and no new title exceptions after the Effective Date that, in either case, would materially and adversely affect the development, use or operation of the Project.
2.5.2 City's removal (or Title Company's reasonably insuring over) the Disapproved Title Exceptions.
2.5.3 The representations and warranties of the City and Developer contained in this Agreement being true and correct.
2.5.4 The delivery by City and Developer of all documents and funds required to be delivered pursuant to Section 2.8 hereof.
2.5.5 The Title Company shall have committed to issue at the Close of Escrow an ALTA extended coverage Owner's Title Insurance Policy, with any endorsements reasonably requested by Developer, showing fee simple title to the Land vested in Developer (or Developer's assignee as permitted by this Agreement), subject only to the Permitted Exceptions.
2.5.6 Developer shall have submitted to City, and the City shall have approved, a Project budget, certified by the Developer to be true and correct estimate, and demonstrating that the Developer has identified additional capital funds to finance the difference, if any, between costs of development of the Development and the amount available to the Developer from external sources (the "Project Budget").
2.5.7 Developer shall provide the City the necessary land surveyor documentation for the vacated public streets and/or easements necessary to construct the Project.
Upon receiving the necessary conveyance instruments from the Developer, the City shall take the 7 required lawful actions to vacate any public streets and/or easements necessary to construct the Project.
2.5.8 Developer and City shall have performed, observed and complied with all covenants, agreements and conditions required by this Agreement to be performed, observed and complied with on its part prior to or as of the Close of Escrow.
2.6 Costs: Escrow Holder Settlement Statement.
2.6.1 Developer shall be solely responsible for all costs and expenses related to all surveys, title policies (and endorsements thereto), escrow charges, recording fees, and transfer taxes, and shall, in addition, promptly reimburse the City after receipt of written demand therefore for all third -party fees and expenses (including, but not limited to, attorneys' fees and expenses) incurred by the City in the negotiation of this Agreement.
2.6.2 Escrow Holder is authorized on the Close of Escrow to use the net available proceeds, as determined by the City as of the date of Close of Escrow, of the $15,000.00 to pay for any fees, charges and costs payable under Section 2.6.1 as set forth on the settlement statements approved by the Parties. Before such payments are made, Escrow Holder shall notify the City and Developer of the fees, charges, and costs necessary to close under the Escrow, by delivering draft settlement statements to the Parties for their mutual approval. If the fees, charges and costs payable under Section 2.6.1 exceed the net available proceeds, as of the date of Close of Escrow, of Developer's $15,000.00 deposited in connection with this Agreement, Escrow Holder may charge the Developer for any amounts in excess of the net available proceeds of the Developer deposit.
2.7 Condition of the Property.
2.7.1 "As -Is" Sale. Developer acknowledges and agrees that, except as expressly set forth herein, Developer is acquiring the Land in its "AS IS" condition, WITH ALL
FAULTS, IF ANY, AND, EXCEPT AS EXPRESSLY SET FORTH HEREIN, WITHOUT ANY WARRANTY, EXPRESS OR IMPLIED and neither City nor City any agents, representatives, officers, or employees of City have made any representations or warranties, direct or indirect, oral or written, express or implied, to Developer or any agents, representatives, or employees of Developer with respect to the condition of the Land, its fitness for any particular purpose, or its compliance with any laws, and Developer is not aware of and does not rely upon any such representation to any other party. Except as expressly set forth herein, neither City nor any of its representatives is making or shall be deemed to have made any express or implied representation or warranty, of any kind or nature, as to (a) the physical, legal or financial status of the Land, (b) the Land's compliance with applicable laws, (c) the accuracy or completeness of any information or data provided or to be provided by City, or (d) any other matter relating to the Land.
2.7.1 Delivery of Document bv City: Inspections bv Developer: Due Diligence Period. Within ten (10) business days after the date of this Agreement, City shall deliver to Developer copies of all material, non -privileged documents in the possession of City that pertain to the Property (the "Documents"). Upon the execution of this Agreement until the date that is [ 180] days after the date of this Agreement (the "Due Diligence Period"), Developer and its 8 contractors and consultants who are designated in writing to City ("Developer Designee's") shall have the right to enter onto the Property (without disturbing any occupants thereof) for the purpose of performing the Survey, hazardous materials inspections, soils inspections and other physical inspections and investigations; provided, however, that: (a) Developer shall deliver copies of all inspection reports to City; (b) no inspections or investigations shall damage the Property or any improvements thereon or shall be "invasive" unless the City has received a plan describing the scope of the inspection or investigation and has approved such plan in writing, which approval shall not be unreasonably withheld; (c) Developer shall immediately repair all damage caused by or related to its inspections; and (d) neither Developer nor any of Developer's Designees shall enter the Property unless Developer has provided City reasonable written evidence (such as insurance certificates and/or copies of policies) that the activities of Developer and the Developer Designees are covered by reasonable liability insurance naming City as an additional insured.
Developer shall defend, indemnify and hold City harmless from and against any and all claims, liabilities, losses, damages, costs and expenses (including, without limitation, reasonable attorneys' fees and cost) resulting from the entry onto the Property for such purposes or for purposes of performing the Survey, except to the extent any such claims, liabilities, loss, damages, costs or expenses are the result of the gross negligence or willful misconduct of City. If Developer disapproves any condition of the Property or any Document, then Developer may terminate this Agreement by written notice to City given on or prior to the end of the Due Diligence Period that describes the basis for the disapproval. In addition, if Developer identifies an environmental condition that was not previously acknowledged in the environmental reports, irrespective of whether the Due Diligence Period has expired, and the cost to remediate the environmental condition is greater than the City's monetary contribution toward such remediation, then Developer may terminate this Agreement by written notice to City.
2.7.2 Releases and Waivers. Developer and anyone claiming by, through or under Developer hereby waives its right to recover from and fully and irrevocably releases City, City and its council members, board members, employees, officers, directors, representatives, agents, servants, attorneys, successors and assigns ("Released Parties") from any and all claims, responsibility and/or liability that it may now have or hereafter acquire against any of the Released Parties for any costs, loss, liability, damage, expenses, demand, action or cause of action arising from or related to (i) the condition (including any defects, errors, omissions or other conditions, latent or otherwise, and the presence in the soil, air, structures and surface and subsurface waters of materials or substances that have been or may in the future be determined to be Hazardous Materials or otherwise toxic, hazardous, undesirable or subject to regulation and that may need to be specially treated, handled and/or removed from the Land under current or future federal, state and local laws regulations or guidelines), valuation, salability or utility of the Land, or its suitability for any purpose whatsoever, and (ii) any information furnished by the Released Parties under or in connection with this Agreement. This release includes claims of which Developer is presently unaware or which Developer does not presently suspect to exist which, if known by Developer, would materially affect Developer's release to City and City. Developer specifically waives the provision of California Civil Code Section 1542, which provides as follows:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS
WHICH THE CREDITOR OR RELEASING PARTY DOES NOT
KNOW OR EXPECT TO EXIST IN HIS OR HER FAVOR AT
THE TIME OF EXECUTING THE RELEASE, WHICH IF
9 KNOWN TO HIM OR HER, WOULD HAVE MATERIALLY
AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR
OR RELEASED PARTY"
Developer Initials
In this connection and to the extent permitted by law, Developer hereby agrees, represents and warrants that Developer realizes and acknowledges that factual matters now unknown to it may have given or may hereafter give rise to causes of action, claims, demands, debts, controversies, damages, costs, losses and expenses which are presently unknown, unanticipated and unsuspected, and Developer further agrees, represents and warrants that the waivers and releases herein have been negotiated and agreed upon in light of that realization and that Developer nevertheless hereby intends to release, discharge and acquit Released Parties from any such unknown causes of action, claims, demands, debts, controversies, damages, costs, losses and expenses which might in any way be included as a material portion of the consideration given to City by Developer in exchange for City's performance hereunder.
Developer hereby agrees that, if at any time after the Close of Escrow any third party or any governmental agency seeks to hold Developer responsible for the presence of, or any loss, cost or damage associated with, Hazardous Materials in, on, above or beneath the Land or emanating therefrom, then Developer waives any rights it may have against City in connection therewith, including, without limitation, under CERCLA (as defined in Section 1.1.19 and Developer agrees that it shall not (i) implead the City, (ii) bring a contribution action or similar action against City, or (iii) attempt in any way to hold City responsible with respect to any such matter. The provisions of this Section 2.7.3 shall survive the Close of Escrow.
City and Developer have each initialed this Section 2.7.3 to further indicate their awareness and acceptance of each and every provision hereof.
CITY'S INITIALS DEVELOPER'S INITIALS
The foregoing releases and waivers shall not, however, apply to Hazardous Materials on the Property prior to Close of Escrow known to the City but not known to Developer and not disclosed by the City to Developer.
2.7.3 Environmental Indemnity. From or after the Close of Escrow, Developer shall indemnify, protect, defend and hold harmless the City, and the City's officials, officers, attorneys, employees, consultants, agents and representatives, from and against any and all claims, liabilities, suits, losses, costs, expenses and damages, including but not limited to reasonable attorneys' fees and costs, arising directly or indirectly out of any claim for loss or damage to the Land or for the cost of remediating the Land and removing Hazardous Materials therefrom, by reason of Developer's release of Hazardous Materials on the Land, or by reason of any statutes, ordinances, orders, rules or regulations of any governmental entity or City requiring the remediation of any Hazardous Materials that Developer releases on the Land, provided. 10 however. that the foregoing shall not apply to Hazardous Materials on the Property known by the City and existing prior to Close of Escrow.
2.8 Deposits into Escrow.
2.8.1 The City hereby covenants and agrees to deliver to Escrow Holder prior to the Close of Escrow the following instruments and documents, the delivery of each of which shall be a condition of the Close of Escrow:
2.8.1.1 A Grant Deed duly executed and acknowledged by the City, in the form attached hereto as Exhibit "E".
2.8.1.2 The affidavit as contemplated by California Revenue and Taxation Code § 18662 ("Withholding Affidavit");
2.8.1.3 A Certification of Non -Foreign Status in accordance with I.R.C. Section 1445 (the "FIRPTA Certificate');
2.8.1.4 An executed and acknowledged Counterpart of the Memorandum of Disposition and Development Agreement in the form attached hereto as Exhibit "F"; and
2.8.1.5 Such proof of the City's authority and authorization to enter into this transaction as the Title Company may reasonably require in order to issue Developer's policy of title insurance.
2.8.2 Developer shall deposit with Escrow Holder, prior to or concurrent with the Close of Escrow, an executed and acknowledged counterpart of a Memorandum of Disposition and Development Agreement in the form attached hereto as Exhibit "F" and funds sufficient to satisfy Developer's monetary obligations at Closing in accordance with this Agreement.
2.9 Authorization to Record Documents and Disburse Funds. Escrow Holder is hereby authorized to record the documents and disburse the funds and documents called for hereunder upon the Close of Escrow, provided each of the following conditions has then been fulfilled:
1. The Title Company can issue in favor of Developer an ALTA Extended Coverage Owner's Policy of Title Insurance, showing the Land vested in Developer subject only to the Permitted Title Exceptions.
2. The City shall have deposited in Escrow the documents required pursuant to Section 2.10.1, and Developer shall have deposited in Escrow the Purchase Price and all Escrow closing costs.
3. The City and Developer have confirmed to Escrow Holder that all of the other closing conditions set forth in Section 2.5 have been satisfied or expressly waived in writing by the Party(s) benefited thereby.
11 Unless otherwise instructed in writing, Escrow Holder is authorized to record at the Close of Escrow any instrument delivered through this Escrow if necessary or proper for issuance of Developer's title insurance policy.
2.10 Escrow's Closing Actions. On the Close of Escrow, Escrow Holder shall:
2.10.1.1 Record the Grant Deed and the Memorandum of Disposition and Development Agreement with the Orange County Recorder (which shall be deemed delivery of said instruments to Developer);
2.10.1.2 Issue the Title Policy (or cause the Title Company to issue the Title Policy);
2.10.1.3 Prorate taxes, assessments, rents, and other charges as of the Close of Escrow in accordance with the settlement statements approved by the Parties.
2.10.1.4 From funds deposited by Developer, pay prorated amounts and charges to be paid by or on behalf of Developer, and return any excess to Developer;
2.10.1.5 Prepare and deliver to both Developer and the City one signed copy of Escrow Holder's closing statement showing all receipts and disbursements of the Escrow; and
2.10.1.6 Deliver the FIRPTA Certificate and the Withholding Affidavit to Developer.
2.12 Termination by the Developer. In the event that despite making best efforts, Developer is unable to obtain financing acceptable to Developer in its sole discretion in the timeframe set forth in Exhibit "D" Feasibility Threshold Funding Program Award Schedule or Exhibit "B" Schedule of Performance or otherwise determines in its sole discretion, prior to Close of Escrow, that development of the Project is not feasible, or if the City is in default hereunder, or a termination occurs due to a failure of a condition set forth in Section 2.5, or pursuant to Section
6.2.1, then, at the option of the Developer, upon such written notice thereof to the City, this Agreement shall be terminated at no cost or financial obligation of any kind to City, and thereafter neither party shall have any further rights or liability against the other under this Agreement.
Should Developer exercise their termination rights pursuant to this paragraph, then all Good Faith Deposits made by Developer as required by this Agreement shall be nonrefundable.
2.13 Additional Instructions. If required by the Escrow Holder, the Parties shall execute appropriate escrow instructions, prepared by the Escrow Holder, which are not inconsistent herewith. If there is any inconsistency between the terms hereof and the terms of the escrow instructions, the terms hereof shall control unless an intent to amend the terms hereof is expressly stated in such instructions.
3. DEVELOPMENT COVENANTS; DEVELOPER OBLIGATIONS.
3.1 Development of the Project. Except as set forth below, Developer shall develop the Improvements on the Land in accordance with the Scope of Development, the 12 Schedule of Performance, all requirements of any and all applicable federal, state and local laws, rules and regulations (including any conditions of approval required by the City), the Plans and Specifications, and all other terms, conditions and requirements of this Agreement. Developer shall strictly comply with Exhibit "B", the Schedule of Performance, and the obligations set forth in Exhibit "D", Feasibility Threshold Funding Program Award, provided that the obligations of Developer set forth therein which are to be performed after the Close of Escrow or shall be delayed by Force Majeure Delays, if applicable, and provided, further, that the City Administrator of the City may extend any deadline therein in his or her sole and absolute discretion except an extension of the Closing Date or Term must be approved by the Placentia City Council. Until a Certificate of Completion is issued, the Developer shall provide the City with periodic progress reports, on no less than a quarterly basis, or as reasonably requested by the City, regarding the status of the construction of the Improvements.
3.2 City's Right to Review Plans and Specifications. In connection with construction of the Project, the Developer shall comply in all material respects with Plans and Specifications approved by the City.
3.3 Construction Contracts. Developer shall retain one or more reputable and financially responsible general contractors (each, a "General Contractor") to undertake the construction of the Project. Each General Contractor shall be experienced in constructing the type of improvements constituting the Improvements. On or before the date set forth in the Schedule of Performance, Developer shall enter into a written contract (the "Construction Contract") with the General Contractor(s) for performing the work constituting the construction of all of the Project. Each such Construction Contract shall be a guaranteed maximum cost contract or stipulated sum ensuring construction of the improvements for a fixed or maximum price and shall obligate the General Contractor to commence and complete such construction in accordance with this Agreement and all applicable federal, state and local laws, rules and regulations. Each such Construction Contract shall provide for retention of at least ten percent from each progress payment (except there shall be no retention for any items excused from retention as specified in the Construction Contract) until the final payment, and said final payment shall not be paid to the General Contractor until the portion of the Project covered by such Construction Contract shall have been completed to Developer's satisfaction, and Developer shall have obtained all appropriate lien waivers from the General Contractor and its subcontractors, or bonds acceptable to Developer in form and amount, insuring against loss arising from any mechanics', laborers', materialmen's or other like liens filed against the Land.
3.4 Costs of Entitlement, Development and Construction. The Developer agrees that all costs, expenses and fees associated with the development and construction of the Project including the costs for developing and constructing the Improvements thereon (including, but not limited to, the land acquisition costs and governmental permits and approvals) shall be borne by Developer.
3.5 Rights of Access and Inspection. After Close of Escrow, in addition to those rights of access to and across the Land to which the City may be entitled by law, members of the staff of the City shall have a reasonable right of access to the Land, without charge or fee, at any reasonable time, upon reasonable notice to Developer (which may be telephonic notice to the project manager or construction manager or contractor's superintendent) to inspect the work being 13 performed at the Land in connection with the initial development of the Project but shall not be obligated to do so and City shall not be liable for any failure to disclose any information discovered by City (or that could or should have been discovered by any City inspection). The City shall also have the right at all reasonable times upon reasonable prior notice to inspect and copy the books, records and all other documentation of the Developer pertaining to its obligations under this Agreement. City shall defend, indemnify, and hold Developer harmless from and against any and all claims, liabilities, losses, damages, costs and expenses (including, without limitation, reasonable attorneys' fees and costs) resulting from the City's entry onto the Property for such purposes, except to the extend such claims, liabilities, losses, damages, costs or expenses are the result of the gross negligence or willful misconduct of Developer. Any damage or injury to the Property resulting from such entry by City shall be promptly repaired at the sole expense of City.
3.6 Local, State and Federal Laws. Developer shall carry out the construction of the Improvements on the Land in conformity with all applicable federal, state and local laws, including all applicable federal and state occupation, safety and health standards.
3.7 City and Other Governmental Agency Permits and Approvals. Before commencement of construction or development of any work of improvement on the Land, Developer shall (at Developer's expense) secure, or cause to be secured, any and all permits which may be required by the City or any other governmental agency having jurisdiction over such construction or development.
3.8 Anti -discrimination During Construction. Developer, for itself and its successors and assigns, agrees that it shall not discriminate against any employee or applicant for employment because of age, sex, marital status, race, handicap, color, religion, creed, ancestry, or national origin in the construction of the Improvements.
3.9 Taxes, Assessments, Encumbrances and Liens. Developer shall pay when due all real property taxes and assessments assessed or levied on portions of the Land from time to time owned by Developer, commencing immediately after closing of the land acquisition.
3.10 No Joint Venture or Agency Created. In performing this Agreement, Developer is an independent contractor and not the agent of City. The City is not an agent of Developer. The City shall not have any responsibility whatsoever for payment to any contractor or supplier of Developer or its contractors. Developer shall not have any responsibility whatsoever for payment to any contractor or supplier of the City.
3.11 Certificate of Completion. Upon Developer's completion of the construction of the Project, Developer will apply to the City for a Certificate of Completion. The City's issuance of the Certificate of Completion shall constitute the acknowledgement of the City that Developer has complied in all respects with its development obligations (and only the development obligations) set forth in this Article 3. Promptly following the City's issuance of a certificate of occupancy for the entire project, and provided that Developer is then in full compliance with all of its obligations under Article 3 of this Agreement, the City shall execute, acknowledge and deliver the Certificate of Completion, which shall be recorded in the Official Records of Orange County and shall include, in form reasonably acceptable to Developer, an express termination or reconveyance of the City 's power of termination and right to reversion 14 under Section 6.2.2(ii) of this Agreement and the Grant Deed. If the City believes that the Developer is not in compliance with its obligations under this Article 3, the City shall promptly specify the nature of such non-compliance by written notice to Developer.
3.12 Housing Priority Preferences to Be Established.
3.12.1 To better coordinate access points, assessments, resources, and programs serving persons experiencing homelessness, the Orange County Continuum of Care divided the County into three (3) geographic "Service Planning Areas" (or "SPAs"), with the "North Service Planning Area" ("North SPA") including the cities of Anaheim, Brea, Buena Park, Cypress, Fullerton, La Habra, La Palma, Los Alamitos, Orange, Placentia, Stanton, Villa Park, and Yorba Linda.
3.12.2 The management and operational plan for the North SPA Navigation Centers, which serve the North SPA Homeless Collaborative and includes all of the North SPA cities except the City of Anaheim, are located in the City of Placentia and the City of Buena Park and specify certain requirements to ensure local control for providing safe and secure housing as well as providing comprehensive programs and services. The North SPA Navigation Centers are referral -only based facilities with managed and controlled access in and out via transportation only.
The North SPA Navigation Centers work to not only house the homeless that may qualify, but to provide health resources, counseling, job and social skills, and opportunities to reunite with family and friends, with the goal of integrating North Orange County's homeless to become productive members of society while decreasing the number of homeless in public areas. Developer shall take all reasonable and lawful measures to establish a preference placement program for individuals and families temporarily residing at the North SPA Homeless Collaborative Navigation Centers.
3.12.3 The City of Placentia works closely with Homeless Intervention Services of Orange County (HIS OC), a Transitional Housing Center for homeless housing. HIS OC assists homeless families to achieve stable, permanent housing and financial independence.
Developer shall dedicate one unit for the purposes of housing a family needing to relocate from the HIS OC Transitional Housing Center Program.
4. LIMITATIONS ON TRANSFERS AND SECURITY INTERESTS.
4.1 Restriction on Transfer of Developer's Rights and Obligations.
4.1.1 Except as provided herein, prior to issuance of a Certificate of Completion for the Project and the opening of the Project for business, Developer shall not sell, assign, transfer, mortgage, lease (except for space leases conditioned upon Project completion), hypothecate, or convey (collectively, a "Transfer") the Land or any part thereof or any of Developer's rights or obligations hereunder, without the City's prior written consent, which consent may not be unreasonably withheld by City except for the execution of one or more deeds of trust and related instruments securing Developer's construction and permanent loans, a conveyance of the Land resulting from the foreclosure thereof (or a deed -in -lieu of such a foreclosure). Developer acknowledges that the identity of Developer is of particular concern to the City, and it is because of Developer's identity that the City has entered into this Agreement with Developer. City understands, acknowledges and agrees that Developer intends to form a new 15 entity, Mercy Housing California 119, L.P., a California limited partnership, and reserves all rights to assign its rights, interests and obligation to Mercy Housing California 119, L.P., a California limited partnership. Developer and City further understand, acknowledge and agree that Developer may obtain from the City a parcel map, except for any Transferee approved by the City pursuant to this Section 4.1, and except for any Holder (defined in Section 4.2) that has taken possession of the Land, no voluntary or involuntary successor in interest of Developer shall acquire any rights or powers under this Agreement prior to the issuance of a Certificate of Completion. Except as expressly permitted herein, no transfer or assignment of Developer's interest hereunder without the City's prior written approval shall be deemed to release Developer from the obligations of Developer hereunder.
4.1.2 Subject to Section 4.2 below, after the issuance of a Certificate of Completion for the entire Project, and the opening of the Project for business, Developer shall have the right to Transfer the Land or any divisible portion of the Project to any party (a "Transferee") provided that:
4.1.2.1 the Transferee (and/or its management company or affiliates, if any) has the experience, quality, character, trade record, financial ability and reputation, as determined by City in its reasonable judgment, to own the Project or any portion thereof and to cause it to be managed and operated (whether directly or through an Operating Agreement approved by the City in accordance with this Agreement) in compliance with this Agreement; and
4.1.2.2 the Transferee assumes in writing all obligations of Developer set forth in this Agreement (except those pursuant to Articles 2 and 3, which shall be deemed satisfied upon the Close of Escrow and the issuance of the Certificate of Completion, respectively).
In the event that Developer desires to Transfer the Land pursuant to this Section 4.1.2, Developer will so notify the City, and will provide the City with all pertinent information regarding the Transferee. The City will approve or disapprove the Transferee, in its reasonable judgment which consent may not be unreasonably withheld, conditioned or delayed within fifteen (15) days after receipt of written notice of Developer's intention to make the Transfer. Upon the completion of any Transfer to a Transferee approved by the City as provided in this Section 4.1.2, the Transferee shall assume all of Developer's rights and obligations under this Agreement with respect to the interest conveyed, and Developer shall be released from all further liabilities and obligations under this Agreement with respect to the interest conveyed.
4.2 Holders of Deeds of Trust. Notwithstanding any provisions of Section 4.2 to the contrary, Developer shall have the right to hypothecate its interest in the Land and the Project pursuant to one or more deeds of trust from an institutional lender, for the purpose of securing loans of funds to be used for financing the direct and indirect costs of the Project (including land development costs, reasonable and customary developer fees, loan fees and costs, and other normal and customary project costs), or for refinancing the construction financing with permanent financing. Any institutional lender of record holding any such deed of trust, whose name and address shall have been provided by Developer to City referred to herein as a "Holder." 16 4.3 Rights of Holders. The City shall deliver a copy of any notice or demand to Developer concerning any breach or default by Developer under this Agreement to each Holder who has previously made a written request to the City for special notice hereunder. Any notice of breach or default by Developer shall not be effective against any such Holder unless given to such Holder. Such Holder shall have the right, but not the obligation, at its option to cure or remedy any such default and to add the cost thereof to the secured debt and the lien of its security interest.
If such breach or default can only be remedied or cured by such Holder upon obtaining possession, such Holder may remedy or cure such breach or default within a reasonable period of time after obtaining possession, provided such Holder seeks possession with diligence through a receiver or foreclosure. Such Holder shall not be obligated to undertake or continue the construction or completion of the Improvements beyond the extent necessary to conserve or protect the Improvements already constructed. Any Holder completing the Improvements must assume all rights and obligations of Developer under this Agreement and shall then be entitled, upon written request made to the City, to a Certificate of Completion from the City.
4.4 Noninterference with Holders. The provisions of this Agreement do not limit the right of Holders (a) to foreclose or otherwise enforce any mortgage, deed of trust, or other security instrument encumbering all or any portion of the Land, and the Improvements thereon, (b) to pursue any remedies for the enforcement of any pledge or lien encumbering such portions of the Land, or (c) to accept, or cause its nominee to accept, a deed or other conveyance in lieu of foreclosure or other realization. In the event of (i) a foreclosure sale under any such mortgage, deed of trust or other lien or encumbrance, (ii) a sale pursuant to any power of sale contained in any such mortgage or deed of trust, or (iii) a deed or other conveyance in lieu of any such sale, the purchaser or purchasers and their successors and assigns, and such portions of the Land shall be, and shall continue to be, subject to all of the conditions, restrictions and covenants of all documents and instruments recorded pursuant to this Agreement, including, without limitation, the restrictions set forth in the grant deed on such property from the City to Developer. The City agrees to execute such further documentation regarding the rights of any Holder as is customary with respect to construction or permanent financing, as the case may be, to the extent that such documentation is reasonably requested by any Holder and is reasonably approved by the City.
4.5 Right of City to Cure. In the event of a default or breach by the Developer of a loan by a Holder prior to the completion of the Improvements, the City may, upon prior written notice to the Developer, cure the default, prior to the completion of any foreclosure. In such event the City shall be entitled to reimbursement from the Developer of all costs and expenses incurred by the City in curing the default. The City shall also be entitled to a lien upon the Land or any portion thereof to the extent of such costs and disbursements. The City agrees that such lien shall be subordinate to any lien in favor of a Holder, and the City shall execute from time to time any and all documentation reasonably requested by the Developer to effect such subordination.
4.6 Right of City to Satisfy Other Liens. After the Close of Escrow and after the Developer has had a reasonable time to challenge, cure, or satisfy any liens or encumbrances on the Land or any portion thereof, and has failed to do so, in whole or in part, the City shall, upon prior written notice to the Developer, have the right to satisfy any such lien or encumbrances; however, nothing in this Agreement shall require the Developer to pay or make provision for the payment of any tax, assessment, lien or charge so long as the Developer in good faith shall contest 17 the validity or amount therein and so long as such delay in payment shall not subject the Land or any portion thereof to forfeiture or sale.
5. USE AND OPERATION OF THE PROPERTY.
5.1 Maintenance by Developer. After the issuance of the Certificate of Completion, Developer and its successors in interest with respect to the Project shall maintain the Project (including landscaping) in a manner substantially comparable to the level of maintenance provided to other developments of similar age and quality to the Project located in Orange County.
The Developer shall maintain the Development in good repair and working order, and in a neat, clean and orderly condition, including the walkways, driveways, and landscaping, and from time to time make all necessary and proper repairs, renewals, and replacements. In the event that there arises at any time prior to the expiration of the Termination Date a condition in contravention of the above maintenance standard, then the City shall notify the Developer in writing of such condition, giving the Developer thirty (30) days from receipt of such notice to cure said condition; provided, however, if such condition is not reasonably curable within such thirty (30) day period, then Developer shall have such additional time as reasonably necessary to cure such condition, provided Developer commences to cure such condition within such thirty (30) day period and thereafter fails to diligently prosecute such condition to completion;. In the event the Developer fails to cure or commence to cure the condition within the time allowed, the City shall have the right to perform all acts necessary to cure such a condition, or to take other recourse at law or in equity the City may then have and to receive from the Developer the City's actual and reasonable costs in taking such action. The parties hereto further mutually understand and agree that the rights conferred upon the City expressly include the right to enforce or establish a lien or other encumbrance against the Land, but such lien shall be subject to previously recorded liens and encumbrances. The foregoing provisions shall be a covenant running with the land and will be enforceable by the City, its successors and assigns.
6. EVENTS OF DEFAULT, REMEDIES AND TERMINATION.
6.1 Defaults - Definition. Subject to the provisions of Section 6.7 hereof, the occurrence of any or all of the following shall constitute a default ("Default") under this Agreement:
6.1.1 Developer's failure to perform its obligations on a timely basis as contained in the Schedule of Performance (subject to Force Majeure Delays) and Feasibility Threshold Funding Program Award Schedule, or any breach of this Agreement by any Party involving the payment of money, and the continuance of such breach for a period of ten (10) days after the non -defaulting Party has given written notice to the defaulting Party, as specified in Section 8.1;
6.1.2 Except as otherwise provided in Section 6.1.1 hereof, a breach of any material term of this Agreement by any Party not involving the payment of money and failure of such Party to cure such breach within thirty (30) days after the non -defaulting Party has given written notice to the defaulting Party; provided, however, if such breach is not reasonably curable within such thirty (30) day period, then such Party shall be deemed in Default only if such Party 18 does not commence to cure such breach within such thirty (30) day period and thereafter fails to diligently prosecute such breach to completion;
6.1.3 Developer's Transfer (as defined in Section 4.2), or the occurrence of any involuntary Transfer, of the Land or any part thereof or interest therein, or any rights or obligations of Developer under this Agreement, in violation of this Agreement;
6.1.4 Developer's failure or refusal to keep in force and effect any material permit or approval with respect to construction of the Project, and Developer's failure to cure such breach within thirty (30) calendar days after notice from the City of Developer's breach; provided, however, if such breach is not reasonably curable within such thirty (30) day period, then Developer shall be deemed in Default only if Developer does not commence to cure such breach within such thirty (30) day period and thereafter fails to diligently prosecute such breach to completion; or
6.1.5 Filing of a petition in bankruptcy by or against any Party or appointment of a receiver or trustee of any property of any Party, or an assignment by any Party for the benefit of creditors, or adjudication that such Party is insolvent by a court, and the failure of such Party to cause such petition, appointment, or assignment to be removed or discharged within 90 days.
below.
6.1.6 The failure to comply with any of the requirements of Section 7
6.2 Remedies.
6.2.1 Remedies Prior to the Close of Escrow. In the event of a Default by any Party prior to the Close of Escrow, the non -defaulting Party shall have the right to terminate this Agreement (provided it is not in Default of its obligation under this Agreement), by delivering written notice thereof to the defaulting Party and to Escrow Holder, subject to the rights of the defaulting Party to cure such Default as provided in Section 6.1. Subject to Section 2.2, such Party may seek against the defaulting Party any available remedies at law or equity, including but not limited to, the right to receive damages (excluding damages for lost profits) or to pursue an action for specific performance. Notwithstanding anything to the contrary contained herein and in addition to the remedies specified hereunder, in the event the City defaults prior to the Close of Escrow, the City shall reimburse Developer for its reasonable costs incurred in connection with the Project's design, entitlements and third -party reports.
6.2.2 Remedies for Default After the Close of Escrow. In the event of a Default by any Party after the Close of Escrow, a non -defaulting party shall be entitled to the following remedies, as applicable:
(i) A defaulting Party shall be liable to the non -defaulting Party for all damages, costs and losses incurred by the non -defaulting Party, and the non -defaulting Party may seek against the defaulting Party any available remedies at law or equity, including but not limited to the right to receive damages or to pursue an action for specific performance; and 19 (ii) Prior to the issuance of the Certification of Completion, the City shall have the power of termination (i.e., so-called "right of reversion") provided for below in this Section 6.2.2 in the event that that Developer fails to complete the Improvements in the time period required by Article 3. In such event, but subject to any agreement between the City and Developer's construction lender(s) in accordance with the provisions of Section 2.5.15 above, the City may terminate this Agreement and reenter and take possession of the Land, with all Improvements thereon, and revest in the City title to the Land theretofore conveyed to the Developer (or its successors in interest), take any and all actions necessary to commence and complete the enforcement of its reversionary interest, and in such event the Developer agrees to promptly take all actions and to execute all documents (including a grant deed) necessary to revert title to the Land to the City (subject to any agreement between the City and Developer's construction lender in accordance with the provisions of Section 2.5.15 above). (iii) Upon re -vesting in the City of title to the Land or any portion thereof as provided in this Section, the City shall use good faith efforts to resell the Land or applicable portion thereof to a qualified and responsible party or parties (as determined by the City) who will assume the obligation of making or completing the Development in accordance with the uses specified for such property herein and in a manner satisfactory to the City. Upon such resale of the Land or any portion thereof, the proceeds thereof payable to the City shall be applied as follows:
1. First to reimburse the City on its own behalf for all costs and expenses incurred by the City, including but not limited to salaries of personnel and legal fees incurred in connection with the recapture, management, and resale of the Land or any portion thereof and (but less any income derived by the City from any part of the Land in connection with such management); all taxes, installments of assessments payable prior to resale, and applicable water and sewer charges with respect to the Land or any portion thereof (or, in the event the Land or any portion thereof is exempt from taxation or assessment or such charges during the period of ownership by the City, an amount equal to the taxes, assessments, or charges that would have been payable if the Land or any portion thereof was not so exempt); any payments made or necessarily to be made to discharge any encumbrances or liens existing on the Land or any portion thereof at the time of re -vesting of title in the City or to discharge or prevent from attaching or being made any subsequent encumbrances or liens due to obligations, defaults, or acts of the Developer, its successors or transferees; and expenditures made or obligations incurred with respect to the making or completion of the Development or any part thereof on the Land; and, any amounts otherwise owing the City by the Developer and its successors or transferee.
2. Second, to reimburse the City for damages to which it is entitled under this Agreement by reason of the Developer's default. transferee, up to the amount equal to:
3. Third, to reimburse the Developer, its successor or
20 (a) The reasonable costs incurred by Developer
to the date of such default, including third -
party costs for entitlements, architectural,
engineering and other reports prepared for
the Project and the reasonable costs of the
improvements the Developer has placed on
the Land or applicable portion thereof at the
Developer's cost; less
(b) the sum of (i) any gains or income withdrawn
or made by the Developer from the Land or
applicable portion thereof, or the
improvements thereon; plus (ii) the amount
of any liens on the Land.
4. Fourth, any balance remaining after such
reimbursements shall be retained by the City as its property.
No Speculation. The rights established in this Article are to be interpreted in light of the fact that the City will convey the Land to Developer for development and operation of the Project thereon and not for speculation in undeveloped land or for construction of different improvements.
6.3 No Personal Liability. No representative, agent, attorney, consultant, or employee of the City shall personally be liable to the Developer or any successor in interest of Developer, in the event of any Default or breach by the City, or for any amount which may become due to Developer or any successor in interest, on any obligation under the terms of this Agreement.
6.4 Rights and Remedies are Cumulative. The rights and remedies of the parties are cumulative, and the exercise by either party of one or more of such rights or remedies shall not preclude the exercise by it, at the same time or different times, of any other rights or remedies for the same default or any other default by the non -defaulting Party; provided, however, that liquidated damages specified herein shall constitute the sole damages recoverable for the default giving rise to such liquidated damages.
6.5 Inaction Not a Waiver of Default. Any failures or delays by either Party in asserting any of its rights and remedies as to any default shall not operate as a waiver of any default or of any such rights or remedies or deprive either such Party of its rights to institute and maintain any actions or proceedings which it may deem necessary to protect, assert or enforce any such rights or remedies. The acceptance by a Party of less than the full amount due from the other party shall not constitute a waiver of such Party's right to demand and receive the full amount due, unless such Party executes a specific accord and satisfaction.
6.6 Force Majeure. Following the Close of Escrow, and notwithstanding anything to the contrary in this Agreement, nonperformance shall be excused when performance is prevented or delayed by reason of any of the following forces reasonably beyond the control of such party (a "Force Majeure Delay"): (i) failure to perform by Developer attributable to any strike, 21 lockout or other labor or industrial disturbance (whether or not on the part of the employees of either party hereto), civil disturbance, pandemic, future order claiming jurisdiction, act of the public enemy, war, riot, sabotage, blockade, embargo, inability to secure customary materials, supplies or labor through ordinary sources by reason of regulation or order of any government or regulatory body; or (ii) delay attributable to severe weather, lightning, earthquake, fire, storm, hurricane, tornado, flood, washout, explosion, or any other similar industry -wide cause beyond the reasonable control of the party from whom performance is required, or any of its contractors or other representatives. Any prevention, delay or stoppage due to any Force Majeure Delay shall excuse the performance of the party affected for a period of time equal to any such prevention, delay or stoppage (except the obligations of either party to pay money to the other party or to close escrow) provided that the Party claiming the Force Majeure Delay notifies the other Party of the Force Majeure Delay within a reasonable time (not to exceed thirty (30) days) after the commencement of the Force Majeure Delay.
6.7 Plans and Data. If this Agreement is terminated for any reason, then Developer shall deliver to the City, without cost or expense to the City, copies of any and all maps, architecture, engineering, subdivision approvals, permits, entitlements, rights, contracts, plans, drawings, studies, designs, reports, surveys, and data pertaining to the Project and its development (collectively, "Site Designs") which are in the possession of Developer.
7. INSURANCE; INDEMNITY.
7.1 Insurance.
From and after the execution of this Agreement, Developer hereby agrees, as more specifically defined in Exhibit "H," to protect, defend, indemnify, and hold free and harmless the City, its officers, officials, agents, employees, and volunteers, at the Developer's sole cost and expense, from and against all actions, suits, claims, liabilities, demands, damages (including foreseeable or unforeseeable consequential damages), penalties, fines, forfeitures, costs and expenses (including all reasonable out-of-pocket litigation costs and reasonable attorneys' fees), or other legal proceedings of any nature whatsoever, related directly or indirectly to, or arising out of or in connection with:
(i) the validity of this Agreement;
(ii) the development and construction by Developer of the Improvements on the Land or the use, ownership, management, occupancy, or possession of the Land during Developer's period of ownership of the Land;
(iii) any breach or Default by Developer hereunder (subject to any liquidated damages provisions otherwise contained in this Agreement); or
(iv) any of Developer's activities on the Land (or the activities of Developer's agents, employees, lessees, representatives, licensees, guests, invitees, contractors, subcontractors, or independent contractors on the Land), regardless of whether such losses and liabilities shall accrue or are discovered before or after termination or 22 expiration of this Agreement, except to the extent such losses or liabilities are caused by the gross negligence or willful misconduct of the City.
7.1.1 It shall be the sole responsibility of Developer to determine whether to pay prevailing wages for any or all work required by this Agreement. As a material part of this Agreement, Developer agrees to assume all risk of liability arising from any decision not to pay prevailing wages for work required by this Agreement.
7.1.2 Developer will defend any action or actions filed in connection with any of said claims or liabilities and will pay all costs and expenses, including legal costs and attorneys' fees incurred in connection therewith.
7.1.3 Developer will promptly pay any judgment rendered against the City, its officers, officials, employees, agents, or volunteers for any such claims or liabilities arising out of or in connection with Developer's (or its employees, lessees, representatives, licensees, guests, invitees, contractors, subcontractors, or independent contractors of the Land) negligent performance of or failure to perform such work, operations, or activities hereunder; and Developer agrees to save and hold the City, its officers, officials, employees, agents, and volunteers harmless therefrom
7.1.4 In the event the City, its officers, officials, employees, agents, or volunteers are made a party to any action or proceeding filed or prosecuted against Developer for such damages or other claims arising or alleged to arise out of or in connection with the performance of or failure to perform the work, operation, or activities of Developer hereunder, Developer shall pay to the City, its officers, officials, employees, agents, or volunteers any and all costs and expenses incurred by the City, its officers, officials, employees, agents, or volunteers in such action or proceeding, including but not limited to, legal costs and attorneys' fees for counsel selected by City.
7.1.5 Developer's duty to defend and indemnify as set out in this Section shall include any claims, liabilities, obligations, losses, demands, actions, penalties, suits, costs, expenses or damages, or injury to persons or property arising or alleged to arise from, in connection with, as a consequence of or pursuant to any State or Federal law or regulation regarding hazardous substances, including but not limited to the Federal Insecticide, Fungicide and Rodenticide Act ("FIFRA"), Comprehensive Environmental Response, Compensation and Liability Act of 1980 ("CERCLA"), Resource Conservation and Recovery Act of 1976 ("RCRA"), the Hazardous and Solid Waste Amendments of 1984, the Hazardous Material Transportation Act, the Toxic Substances control Act, the Clean Air Act, the Clean Water Act, the California Hazardous Substance Account Act, the California Hazardous Waste Control Law or the Porter -Cologne Water Quality Control Act, as any of those statutes may be amended from time to time.
7.1.6 Developer shall require the same indemnification from all subcontractors. Developer's indemnification obligations pursuant to this Section shall survive the Close of Escrow or the termination of this Agreement.
Notwithstanding anything to the contrary contained herein, in no event shall the Developer be liable to the City under this Section 7 for claims, liabilities, obligations, losses, demands, actions, penalties, suits, costs, expenses or damages, resulting exclusively from the gross 23 negligence and/or willful misconduct of the City, its officers, officials, employees, agents, or volunteers.
8. REPRESENTATIONS AND WARRANTIES.
8.1 Developer Representations. Developer represents and warrants to the City as of the date of this Agreement and as of the Close of Escrow that:
(i) Developer is a California nonprofit public benefit
corporation validly existing and in good standing under the laws of the State of California. (ii) Developer has duly authorized the execution and
performance of this Agreement and the execution and performance of all of the closing documents set forth herein.
(iii) Developer's execution and performance of this Agreement and the closing documents will not violate any provision of the Developer's by laws or any deed of trust, lease, contract, agreement, instrument, order, judgment or decree by which Developer is bound.
(iv) The Developer has not engaged a broker with respect to the purchase of the Land contemplated herein.
8.2 City Representation. The City hereby represents and warrants to the Developer that the City has not engaged a broker with respect to the purchase of the Land as contemplated herein.
9. TERM.
9.1 The Term of this Agreement shall commence on the Effective Date and shall continue for a period of eight (8) years thereafter or such earlier date as set forth in this Section 9 or as otherwise set forth in this Agreement (the "Termination Date").
9.1.1 If the Developer has not received a Feasibility Threshold Funding Program Award on or before December 31, 2025, this Agreement shall terminate unless on or before December 31, 2025, the Developer has made an additional Good Faith Deposit to the City in the amount of Fifteen Thousand Dollars ($15,000).
9.1.2 If the Developer has not received a Feasibility Threshold Funding Program Award on or before December 31, 2026, this Agreement shall terminate unless on or before December 31, 2026, the Developer has made an additional Good Faith Deposit to the City in the amount of Twenty -Five Thousand Dollars ($25,000).
9.1.3 If the Developer has not received a Feasibility Threshold Funding Program Award on or before December 31, 2027, this Agreement shall terminate unless on or before December 31, 2027, the Developer has made an additional Good Faith Deposit to the City in the amount of Thirty Thousand Dollars ($30,000).
24 10. GENERAL PROVISIONS.
10.1 Notices. All notices and demands shall be given in writing by certified mail, postage prepaid, and return receipt requested, or by reputable overnight courier. Notices shall be considered given upon the earlier of (a) one business day following deposit or delivery with a nationally recognized overnight courier delivery charges prepaid, or (b) three (3) business days following after deposit, or (c) upon delivery shown on the return receipt in the United States mail, postage prepaid, certified or registered, return receipt requested. Notices shall be addressed as provided below for the respective Party; provided that if any Party gives notice in writing of a change of name or address, notices to such Party shall thereafter be given as demanded in that notice:
City: CITY OF PLACENTIA
401 E. Chapman Avenue
Placentia, CA 92870
Attn: Damien R. Arrula, City Administrator
With a copy to: Jones & Mayer
3777 North Harbor Blvd.
Fullerton, CA 92835
Attn: Christian Bettenhausen, City Attorney
Developer: MERCY HOUSING CALIFORNIA
1500 South Grand Avenue, Suite 100
Los Angeles, CA 90015
Attention: Ed Holder, Vice President
City hereby agrees to provide copies of any written notices to Developer' s limited partners who shall have been identified in writing by Developer to City with a written request to deliver to them copies of notices to Developer under this Agreement. City further agrees that any cure of any default made or tendered by any such limited partner shall be deemed to be a cure by Developer and shall be accepted or rejected on the same basis as if made or tendered by Developer.
10.2 Construction. The Parties agree that each Party and its counsel have reviewed and revised this Agreement and that any rule of construction to the effect that ambiguities are to be resolved against the drafting Party shall not apply in the interpretation of this Agreement or any amendments or exhibits thereto. This Agreement shall be construed as a whole according to its fair language and common meaning to achieve the objectives and purposes of the Parties.
10.3 Interpretation. In this Agreement the neuter gender includes the feminine and masculine, and singular number includes the plural, and the words "person" and "party" include corporation, partnership, firm, trust, or association wherever the context so requires.
Unless otherwise required by a specific provision of this Agreement, time hereunder is to be computed by excluding the first day and including the last day. If the date for performance falls on a Saturday, Sunday, or legal holiday, the date for performance shall be extended to the next business day. All references in this Agreement to a number of days in which either party shall 25 have to consent approve or perform shall mean calendar days unless specifically stated to be business days.
10.4 Time of the Essence. Time is of the essence of this Agreement.
10.5 Warranty Against Payment of Consideration for Agreement. Developer warrants that it has not paid or given, and will not pay or give, to any third person, any money or other consideration for obtaining this Agreement, other than normal costs of conducting business and costs of professional services such as architects, engineers and attorneys.
10.6 Challenge to this Agreement; Indemnity. If the City is made a Party to any litigation instituted by or against Developer or to any litigation attacking the validity of this Agreement, then Developer shall indemnify and defend the City against, and save them harmless from, all costs, expenses (including reasonable attorneys' fees), claims, liabilities, damages and losses incurred by the City in connection with such litigation provided, however, that in no event shall the Developer be obligated to pay any damages awarded to any person or entity that result from the gross negligence or willful misconduct of the City.
10.7 Entire Agreement Waivers and Amendments. This Agreement, together with all attachments and exhibits hereto, and all agreements executed pursuant hereto, constitutes the entire understanding and agreement of the Parties. This Agreement integrates all of the terms and conditions mentioned herein or incidental hereto and supersedes all negotiations or previous agreements between the Parties with respect to the subject matter hereof. No subsequent agreement, representation or promise made by either Party hereto, or by or to any employee, officer, agent or representative of either Party, shall be of any effect unless it is in writing and executed by the Party to be bound thereby. No person is authorized to make, and by execution hereof Developer and the City acknowledge that no person has made, any representation, warranty, guaranty or promise except as expressly set forth herein; and no agreement, statement, representation or promise made by any such person which is not contained herein shall be valid or binding on Developer or the City.
10.8 Severability. Each and every provision of this Agreement is, and shall be construed to be, a separate and independent covenant and agreement. If any term or provision of this Agreement or the application thereof shall to any extent be held to be invalid or unenforceable, the remainder of this Agreement, or the application of such term or provision to circumstances other than those to which it is invalid or unenforceable, shall not be affected hereby, and each term and provision of this Agreement shall be valid and shall be enforced to the extent permitted by law.
10.9 Headings. All section headings and subheadings are inserted for convenience only and shall have no effect on the construction or interpretation of this Agreement.
10.10 No Third Party Beneficiaries other than the City. The City is a third party beneficiary of this Agreement. This Agreement is made and entered into for the sole protection and benefit of the Parties, the City, City and their successors and assigns. No other person shall have any right of action based upon any provision of this Agreement. 26 10.11 Governing Law; Jurisdiction; Service of Process. This Agreement and the rights of the Parties shall be governed by California law. The Parties consent to the exclusive jurisdiction of the California Superior Court for the County of Los Angeles. If any legal action is commenced by Developer against the City, or by City against Developer, service of process on the City shall be made by personal service upon the Executive Director or secretary of the City, or in such other manner as may be provided by law. If any legal action is commenced by City against Developer, service of process on Developer shall be made by personal service at the address provided for notifications above, or in such other manner as may be provided by law. Developer agrees, for the benefit of the City, that it shall designate an agent for service of process in the State of California in the manner prescribed by law.
10.12 Assignability. Except as otherwise expressly provided in Section 4.2, Developer may not assign, transfer or convey its rights and obligations under this Agreement without the prior written consent of the City, which City may withhold in its sole and absolute discretion.
10.13 Survival. The provisions hereof shall not merge into, but rather shall survive, any conveyance hereunder (including, without limitation, the delivery and recordation of the Grant Deed) and the delivery of all consideration.
10.14 Estoppel Certificates. Upon written request of Developer, City shall within ten (10) days of the date of such request, execute and deliver to Developer, a written statement:
certifying, to the best of such City's knowledge, that (a) this Agreement in full force and effect, if such is the case, and has not been modified or amended, except as shall be stated; and (b) that no default by Developer exists under this Agreement.
10.15 City Actions. In addition to any provisions of this Agreement that gives the City Administrator the authority to make decisions and grant approvals, the City hereby authorizes the City's City Administrator to deliver such approvals, consents as are contemplated by this Agreement, waive requirements under this Agreement, and modify this Agreement, on behalf of the City provided that the applicable approval, consent, waiver or modification is minor (i.e., does not change the fundamental business transaction or Term of this Agreement between the Developer and the City, as determined by the City Administrator in his reasonable discretion).
10.16 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed as original but all of which together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Parties hereto have entered into this Agreement as of the day and year first above written.
[remainder of page left intentionally blank; signature page follows] 27 DEVELOPER:
MERCY HOUSING CALIFORNIA:
Developer
By:
CITY OF PLACENTIA:
City
By:
Damien Arrula, City Administrator
ATTEST:
Robert S. McKinnell, City Clerk
By:
Christian Bettenhausen, City Attorney
APPROVED AS TO FORM:
By:
28 EXHIBIT "A"
LEGAL DESCRIPTION OF LAND
THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF
PLACENTIA, IN THE COUNTY OF ORANGE, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS:
300 and 307 Baker Street:
PARCEL 1, IN THE City OF PLACENTIA, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 236, PAGES 11 AND 12 OF PARCEL MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
APN: 339-392-14, 339-392-15
312 Baker Street:
LOT 24 IN BLOCK "B" OF BRADFORD'S RESUBDIVISION OF BLOCKS "H" AND "I" OF THE TOWNSITE OF PLACENTIA, IN THE City OF PLACENTIA, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 8, PAGE 65,
MISCELLANEOUS MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
APN: 339-391-15
314 Baker Street:
LOT 25 IN BLOCK "B" OF BRADFORD'S RESUBDIVISION OF BLOCKS "H" AND "I" OF THE TOWNSITE OF PLACENTIA, IN THE City OF PLACENTIA, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 8, PAGE 65 OF
MISCELLANEOUS MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
APN: 339-391-14
323 Baker Street:
LOT 18 IN BLOCK "B" OF BRADFORDS RE -SUBDIVISION OF BLOCKS "H" AND "I" TOWNSITE OF PLACENTIA, IN THE City OF PLACENTIA, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS SHOWN ON A MAP THEREOF RECORDED IN BOOK 8, PAGE 65 OF MISCELLANEOUS MAPS, RECORDS OF SAID ORANGE COUNTY.
APN: 339-392-19
ADD LEGAL DESCRIPTION FOR BAKER STREET VACATION
TO BE ADDED BY TITLE COMPANY AT CLOSE OF ESCROW
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EXHIBIT "B"
SCHEDULE OF PERFORMANCE
This Schedule of Performance requires the submission of plans or other documents at specific times. Some of the submissions are not described in the text of the Agreement. Such plans or other documents, as submitted, must be complete and adequate for review by the City, City or other applicable governmental entity when submitted. Prior to the time set forth for each particular submission, the Developer shall consult with City and City staff informally as necessary concerning such submission in order to assure that such submission will be complete and in a proper form within the time for submission set forth herein.
Action
Date / Deadline
Items 1 — 7 Relate to Developer Actions and Requirements Prior to or through/at the Close of Escrow
1. Obtain all necessary entitlements Complete per City of Placentia's Site Plan to construct the Project. Review Number 2023-03.
2. Opening of Escrow. The Parties
shall open escrow with the
Escrow Holder.
3. Developer Deposit. The
Developer shall deposit the
Developer Deposit of $15,000
with Escrow Holder.
4. Project Budget. The Developer
has submitted the Project Budget
to City and shall submit
reasonable evidence that the funds
described in the Project Budget
Plan.
5. Insurance on the Land. The
Developer shall submit evidence
of insurance to the City.
6. Final Project Budget and funding
of construction loan, equity set
aside. The Developer shall
submit the Project Budget to City
together with reasonable evidence
that the funds described in the
Project Budget Plan will be
available or committed at the
Closing and Closing of
Construction Loan.
Within five (5) business days after the execution
and delivery of the DDA.
Within ten (10) business days after the City's
and City execution and delivery of the DDA.
Indication of Loan letter submitted and evidence
of Developers capacity to make the required
equity available.
Prior to and as a condition to the Close of
Escrow.
Prior to and as a condition to the Close of
Escrow.
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Action
7. Construction Contract. The
Developer shall submit for City Escrow.
approval the construction contract
for the construction of the
Improvements to the City for
approval.
Date / Deadline
Prior to and as a condition to the Close of
Items 8 Relate to the Conveyance of the Land
8. Close of Escrow. The Developer No later than February 29, 2028, plus one shall purchase the Land from the twelve-month option to extend City.
Items 9 —15 Relate to the Developer Actions and Requirements After the Close of Escrow
9. Building Permits. The Developer Within 30 days following Close of Escrow. shall obtain and the City shall
issue the Building Permit or
permit ready letter for the
construction of the Improvements.
10. Performance and Payment Bonds.
The Developer shall deliver to the
City copies of the required
performance and payment bonds.
11. Insurance, Builders Risk and
Construction. The Developer
shall submit evidence of
insurance to the City.
12. Commencement of Construction.
Developer shall substantially
commence the Improvements.
13. Completion of Grading.
Developer shall substantially
complete the grading for the
Project.
14. Commencement of Vertical
Construction. Developer shall
commence vertical construction.
15. Qualification for Certificate of
Occupancy. The Project shall
qualify for a Certificate of
Occupancy.
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Within 30 days following Close of Escrow.
Within 30 days following Close of Escrow.
No later than 60 days after Close of Escrow.
To be determined by construction schedule
prepared by Contractor.
To be determined by construction schedule
prepared by Contractor.
No later than 36 months after close of escrow.
B-2
EXHIBIT "C"
SCOPE OF DEVELOPMENT
Mercy Housing is proposing the development of a new 100 percent affordable housing development project containing 68 dwelling units, with a mix of one-, two-, and three-bedroom units, and inclusive of 20 permanent supportive housing ("PSH") units, as well as ancillary residential open space and amenity areas including dedicated space for supportive case management services for the Project's PSH residents (the "Project").
The Project would be developed upon an approximately 33,497 square foot (0.77 acre) development site, comprised of four legal parcels associated with the addresses of 300, 307, 312, and 314 Baker Street, as well as a portion of Baker Street to be vacated in connection with the Project. The Project will reach a maximum height of 5 stories and 68 feet and will provide a total of 94 parking spaces.
As determined by the City pursuant to Site Plan Review Number 2023-03, the Project consists of a by -right use under the standards imposed by the City's Old Town Placentia Revitalization Plan and with application of State density bonus law ("DBL"), as set forth at California Government Code Section 65915, the Project complies with all applicable City objective development standards. Accordingly, the City has granted by -right approval of the Project. 12503-0002\861966v 1.doc C-1
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EXHIBIT "D"
FEASIBILITY THRESHOLD FUNDING PROGRAM AWARD SCHEDULE
Milestone
County NOFA Award
MHP SuperNOFA Release
IIG NOFA Release
Application Due to MHP
Application Due to IIG
MITP Award Date
IIG Award Date
Submit Application to CDLAC for Bond
and State Tax Credit Allocation if
Applicable
CDLAC Award Date
Start Construction Deadline
Finish Construction
Milestone
County NOFA Award
MHP SuperNOFA Release
IIG NOFA Release
Application Due to MHP
Application Due to IIG
MHP Award Date
IIG Award Date
Submit Application to CDLAC for Bond
and State Tax Credit Allocation if
Applicable
CDLAC Award Date
Start Construction Deadline
Finish Construction
Milestone
County NOFA Award
MHP SuperNOFA Release
IIG NOFA Release
Application Due to MHP
Application Due to IIG
MHP Award Date
IIG Award Date
Submit Application to CDLAC for Bond
and State Tax Credit Allocation if
Applicable
CDLAC Award Date
Start Construction Deadline
Finish Construction
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FIRST ROUND
County NOFA + MHP +IIG
July 2024
June 2024
June 2024
July 2024
July 2024
December 2024
December 2024
April 2025
August 2025
February 2026
June 2028
Notes
IIG exact dates yet to be announced
IIG exact dates yet to be announced
Based on 2024 timeline
Based on 2024 timeline
Based on 2025 timeline
SECOND ROUND
County NOFA + MHP + IIG
July 2024
June 2025
June 2025
July 2025
July 2025
December 2025
December 2025
April 2026
August 2026
February 2027
June 2029
THIRD ROUND
County NOFA + MHP + IIG
July 2024
June 2026
June 2026
July 2026
July 2026
December 2026
December 2026
April 2027
August 2027
February 2028
June 2030
D-1
Based on 2025 timeline
180 days from bond allocation
Based on 28 month construction period
Notes
IIG exact dates yet to be announced
IIG exact dates yet to be announced
Based on 2024 timeline
Based on 2024 timeline
Based on 2025 timeline
Based on 2025 timeline
180 days from bond allocation
Based on 28 month construction period
Notes
IIG exact dates yet to be announced
IIG exact dates yet to be announced
Based on 2026 timeline
Based on 2026 timeline
Based on 2027 timeline
Based on 2027 timeline
180 days from bond allocation
Based on 28 month construction period
EXHIBIT "E"
FORM OF GRANT DEED
Recording Requested by and when recorded return to
and mail tax statements to:
Assessor's Parcel Map No.:
Exempt from Recording Fees Pursuant to
Government Code Section 27383
GRANT DEED
The undersigned grantor(s) declare(s):
Documentary transfer tax is $ based on the full value of the property conveyed.
FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, ("Grantor") hereby GRANTS to
, a ("Grantee") the following described real
property (the "Land") located in the City of Placentia, County of Orange, State of California:
SUBJECT TO, all easements, covenants, conditions, restrictions, and rights of way of record.
1. This grant of the Land is subject to a Disposition and Development Agreement entered into by and between Grantor and Grantee dated as of , 2024, (the "DDA") the terms of which are incorporated herein by reference. A copy of the Agreement is available for public inspection at the offices of the Grantor at 401 E.
Chapman Ave., Placentia, CA 92870.
2. The Grantee covenants by and for itself, its representatives, its successors and assigns and every successor in interest to the Land or any part thereof, that during construction of improvements and thereafter the Grantee shall not use or permit the use of the Land in violation of City, State and Federal regulations.
3. . The Grantee further covenants and agrees that for a period of 8 years after the date of recordation of this Deed, the Grantee shall maintain the Project (including landscaping) in good condition and repair and in the manner substantially comparable to 12503-0002\861966v1.doc E-1
485.260/590030
maintenance provided to other projects of similar type, age and quality as the Project located in Orange County. Grantee shall also maintain the insurance described in Article 7 of the Agreement.
4. All covenants contained in this Grant Deed shall run with the land and shall be binding for the benefit of Grantor and its successors and assigns and such covenants shall run in favor of the Grantor and for the entire period during which the covenants shall be in force and effect, without regard to whether the Grantor is or remains an owner of any land adjacent to the Land or interest in such adjacent land or any other land. The Grantor, in the event of any breach of any such covenants, shall have the right to exercise all of the rights and remedies available under the Agreement or at law or in equity. The covenants contained in this Grant Deed shall be for the benefit of and shall be enforceable only by the Grantor and its successors and assigns.
5. As provided in, and subject to the provisions contained in, Section 6.2 of the Agreement, the Grantor shall have the right, at its option, to reenter and take possession of the Land hereby conveyed, with all improvements thereon and to terminate and revest in Grantor the Land hereby conveyed to the Grantee (or its successors in interest).
6. The Grantee covenants, for itself and its successors and assigns, that there shall be no sale, transfer, assignment, conveyance, lease, pledge or encumbrance of the DDA, or the Land and the Improvements thereon or any part thereof, or of other ownership interest in the Grantee in violation of the DDA, which contains restrictions on the assignment of the DDA and the transfer of the Land.
IN WITNESS WHEREOF, the undersigned has executed this Grant Deed as of the date set forth below.
Dated:
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By:
Print Name:
Title:
ATTEST:
Secretary
APPROVED AS TO FORM:
By:
Christian Bettenhausen, City Attorney
E-2
EXHIBIT "F"
FORM OF DDA MEMORANDUM
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
No fee for recording pursuant
to Government Code Section 27383
MEMORANDUM OF DISPOSITION AND DEVELOPMENT AGREEMENT
THIS MEMORANDUM OF DISPOSITION AND DEVELOPMENT
AGREEMENT (the "Memorandum of DDA") is made as of , 2024, by and between the CITY OF PLACENTIA (the "City") and _MERCY HOUSING CALIFORNIA (the "Developer") to confirm that the City and the Developer have entered into that certain Disposition and Development Agreement dated as of , 2024 (the "DDA"). The DDA imposes certain conditions (including but not limited to, construction requirements, operating covenants, and transfer restrictions) on the real property described in Exhibit A attached hereto and incorporated herein (the "Land"). The DDA is a public document and may be reviewed at the principal office of the City of Placentia.
IN WITNESS WHEREOF, the parties have caused this Memorandum of DDA to be duly executed as of the date first above written.
CITY:
1203-0002\861966v 1.doc
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By:
Print Name:
Title: City Administrator
Attest:
Secretary
APPROVED AS TO FORM:
By:
Christian Bettenhausen, City Attorney
F-1
DEVELOPER:
By:
Print Name:
Title:
[SIGNATURES MUST BE DULY ACKNOWLEDGED BY A NOTARY PUBLIC] 12503-0002\861966v1.doc
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F-2
State of California
County of
On before me,
(insert name and title of the officer)
personally appeared
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature (Seal)
Signature of Notary Public
State of California
County of
On
before me,
(insert name and title of the officer)
personally appeared
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature (Seal)
Signature of Notary Public
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F-3
EXHIBIT A TO MEMORANDUM OF DISPOSITION
AND DEVELOPMENT AGREEMENT
LEGAL DESCRIPTION OF THE PROPERTY
THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF
PLACENTIA, IN THE COUNTY OF ORANGE, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS:
300 and 307 Baker Street:
PARCEL 1, IN THE City OF PLACENTIA, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 236, PAGES 11 AND 12 OF PARCEL MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
APN: 339-392-14, 339-392-15
312 Baker Street:
LOT 24 IN BLOCK "B" OF BRADFORD'S RESUBDIVISION OF BLOCKS "H" AND "I" OF THE TOWNSITE OF PLACENTIA, IN THE City OF PLACENTIA, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 8, PAGE 65,
MISCELLANEOUS MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
APN: 339-391-15
314 Baker Street:
LOT 25 IN BLOCK "B" OF BRADFORD'S RESUBDIVISION OF BLOCKS "H" AND "I" OF THE TOWNSITE OF PLACENTIA, IN THE City OF PLACENTIA, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 8, PAGE 65 OF
MISCELLANEOUS MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
APN: 339-391-14
323 Baker Street:
LOT 18 IN BLOCK "B" OF BRADFORDS RE -SUBDIVISION OF BLOCKS "H" AND "I" TOWNSITE OF PLACENTIA, IN THE City OF PLACENTIA, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS SHOWN ON A MAP THEREOF RECORDED IN BOOK 8, PAGE 65 OF MISCELLANEOUS MAPS, RECORDS OF SAID ORANGE COUNTY.
APN: 339-392-19
ADD LEGAL DESCRIPTION FOR BAKER STREET VACATION
TO BE ADDED BY TITLE COMPANY AT CLOSE OF ESCROW
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F -4-A
EXHIBIT "G"
LIST OF HAZARDOUS MATERIALS DOCUMENTS
DELIVERED TO DEVELOPER
Phase I Environmental Site Assessment Report for 307, 312, and 314 Baker Street, Placentia, California dated February 6, 2023 prepared by Converse Consultants provided as part of the City of Placentia's Request for Quotes and Proposals for the Affordable Housing Development Opportunity released on February 6, 2023.
Phase I Environmental Site Assessment Report for 323 Baker Street, Placentia, California dated February 6, 2023 prepared by Converse Consultants provided as part of the City of Placentia's Request for Quotes and Proposals for the Affordable Housing Development Opportunity released on February 6, 2023.
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G-1
EXHIBIT "H"
INSURANCE REQUIREMENTS
A. Minimum Scone and Limits of Insurance
City reserves the right to review any and all of the required insurance policies and/or endorsements, but has no obligation to do so. Failure to demand evidence of full compliance with the insurance requirements set forth in this Agreement or failure to identify any insurance deficiency shall not relieve Developer from, nor be construed or deemed a waiver of, its obligation to maintain the required insurance at all times during the performance, including any extension thereof, of this Agreement.
Developer shall obtain, maintain, and keep in full force and effect during the life of this Agreement, including any extension thereof, all of the following minimum scope of insurance coverages:
1. Commercial General Liability Insurance
From and after the close of Escrow and for so long as title to the Land has not reverted to by the City, Developer shall obtain and maintain broad -form commercial general liability, with coverage at least as broad as the most current version of ISO Commercial General Liability coverage form CG 00 01, in a form at least as broad as ISO form CG 00 01 04 13, and shall include insurance for premises and operations, products/completed operations, broad form property damage, blanket contractual liability, independent contractors, personal injury or bodily injury, and personal and advertising injury with a policy limit of not less than Five Million Dollars ($5,000,000.00) per occurrence and Ten Million Dollars ($10,000,000.00) general aggregate. The aggregate limit, encompassing the above coverage, shall apply separately to this project/location. Coverage shall be continued for three (3) years after completion of the work. If Developer maintains higher limits than the specified minimum limits, City requires and shall be entitled to coverage for the higher limits maintained by the Developer.
Any deductible or self-insured retention shall be shown on the certificate of insurance. If the deductible or self-insured retention exceeds $25,000.00, it must be approved in advance by City. Developer is responsible for any deductible or self-insured retention and shall fund it upon City's written request, regardless of whether Developer has a claim against the insurance or is named as a party in any action involving City.
2. Business Automobile Liability Insurance
Business automobile liability for all owned, hired, leased, and non -owned vehicles at least as broad as the most current version of ISO Business Auto Coverage Form CA 00 01, with a policy limit of not less than Two Million Dollars ($2,000,000.00) combined single limit per accident. If Developer maintains higher limits than the specified minimum limits, City requires and shall be entitled to coverage for the higher limits maintained by the Developer. 485.260/590030
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3. Workers' Compensation and Employer's Liability Insurance Workers' compensation insurance as required by the State of California and Employer's Liability Insurance with a minimum limit of One Million Dollars ($1,000,000.00) per accident for any employee or employees of Developer. Developer agrees to waive and to obtain endorsements from its workers' compensation insurer waiving subrogation rights under its workers' compensation insurance policy against the City, its officers, officials, agents, employees, and volunteers for losses arising from work performed by Developer for the City and to require each of its subcontractors, if any, to do likewise under their workers' compensation insurance policies.
4. Professional Errors and Omissions ("E&O") Liability Insurance Professional errors and omissions ("E&O") liability insurance on an occurrence based policy with policy limits of not less than Two Million Dollars ($2,000,000.00) per occurrence and Three Million Dollars ($3,000,000.00) policy aggregate. Architects' and engineers' coverage shall be endorsed to include contractual liability. The retroactive date must be shown, and this date must be before the date of the contract or the beginning of contract work. Insurance must be maintained and evidence of insurance must be provided for at least three (3) years after completion of the contract of work. If coverage is canceled or non -renewed, and not replaced with another policy form with a retroactive date prior to the contract effective date, the Developer must purchase "extended reporting coverage" for a minimum of three (3) years after completion of contract work. A copy of the claims reporting requirements must be submitted to the Project Manager for review. If Developer maintains higher limits than the specified minimum limits, City requires and shall be entitled to coverage for the higher limits maintained by the Developer.
5. Pollution Liability Insurance
Pollution liability insurance coverage with a policy limit of not less than Two Million Dollars ($2,000,000.00) per pollution incident and Two Million Dollars ($2,000,000.00) policy aggregate. Coverage shall apply to pollution incidents at or from any location at which Developer is performing work under this Agreement. Insurance coverage shall be continued for three (3) years after completion of the work. If Developer maintains higher limits than the specified minimum limits, City requires and shall be entitled to coverage for the higher limits maintained by the Developer.
Any deductible or self-insured retention shall be shown on the certificate of insurance. If the deductible or self-insured retention exceeds $25,000.00, it must be approved in advance by City. Developer is responsible for any deductible or self-insured retention and shall fund it upon City's written request, regardless of whether Developer has a claim against the insurance or is named as a party in any action involving City. 485.260/590030
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6. "All Risk" Builder's Insurance
"All risk" builder's risk insurance, including coverage for vandalism and malicious mischief, in a form and amount reasonably acceptable to the City. During the construction of Improvements on any portion of the Land by Developer, such builder's risk insurance shall cover Improvements in place and all material and equipment at the job site furnished under contract, but shall exclude contractors', subcontractors', and construction managers' tools and equipment and property owned by contractors' and subcontractors' employees.
7. Commercial Property Insurance
After the opening of the Project for business, commercially reasonable property insurance against all risks of loss to any tenant Improvements or Betterments, at full replacement cost with no coinsurance penalty provision.
8. Standards for Insurance Comnanies
All insurance policies shall be issued by an insurance company currently authorized by the Insurance Commission to transact business of insurance or is on the List of Approved Surplus Line Insurers in the State of California, with an assigned policyholders' rating of A- (or higher) and Financial Size Category Class VII (or larger) in accordance with the latest edition of Best's Key Rating Guide.
B. Documentation and Other Provisions
1. The commercial general liability insurance policy, business automobile liability policy, and pollution liability insurance policy shall be endorsed to contain the following: The City of Placentia, its officers, officials, agents, employees, and volunteers are additional insureds with respect to: liability arising out of activities performed by or on behalf of the Developer pursuant to its contract with the City; products and completed operations of the Developer; premises owned, occupied, or used by the Developer; and automobiles owned, leased, hired, or borrowed by the Developer. General liability coverage can be provided in the form of an endorsement to the Contractor's insurance at least as broad as one of the following ISO ongoing operations forms: CG 20 10 or CG 20 26 or CG 20 33 (not allowed from subcontractors), or CG 20 38; and one of the following ISO completed operations forms: CG 20 37, 2039 (not allowed from subcontractors), or CG 20 40. Additional insured status shall continue for three (3) years after completion of the work.
2. Said policies shall not terminate, nor shall they be cancelled or coverage reduced, without at least thirty (30) days' written notice to the City. In the event of any cancellation or reduction in coverage or limits of any insurance, Developer shall forthwith obtain and submit proof of substitute insurance. Should Developer fail to immediately procure other insurance, as specified, to substitute for any cancelled policy or reduction in the required coverage limits, the City may procure such insurance at Developer's sole cost and expense.
3. The Developer's insurance coverage shall be primary insurance coverage at least as broad 485.260/590030
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as ISO CG 20 01 04 13 as respects the City of Placentia, its officers, officials, agents, employees, and volunteers. Any other insurance maintained by the City of Placentia shall be excess and not contributing with the insurance provided by this policy.
4. Any failure to comply with the reporting provisions of the policies shall not affect coverage provided to the City of Placentia, its officers, officials, agents, employees, and volunteers.
5. Defense fees and costs shall not deplete the limits of any insurance provided under this Agreement.
6. The Developer's insurance shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the limits of the insurer's liability.
7. Developer shall require and verify that all subcontractors maintain insurance meeting all the requirements stated herein, and Developer shall ensure the City is an additional insured on insurance required from subcontractors.
8. Developer agrees to waive, and to obtain endorsements from insurers waiving, subrogation rights against the City, its officers, agents, employees, and volunteers for losses arising from work performed by Developer for the City and to require each of its subcontractors, if any, to do likewise under their insurance policies.
9. Coverage shall be on a standard occurrence form. Claims -made forms are not acceptable.
Modified, limited, or restricted occurrence forms are not acceptable.
10. Current evidence of coverage shall be provided for the entire required period of insurance.
11. Upon written request, certified copies of required insurance policies shall be provided within (30) days.
485.260/590030
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