HomeMy WebLinkAboutReso 175-2021 (21-719)City of South San Francisco P.O. Box 711 (City Hall,
400 Grand Avenue)
South San Francisco, CA
City Council
Resolution: RES 175-2021
File Number: 21-719 Enactment Number: RES 175-2021
RESOLUTION APPROVING MIDDEN HOUSING
CORPORATION'S RECAPITALIZATION AND
RENOVATION PLANS FOR THE GREENRIDGE AND
WILLOW GARDENS AFFORDABLE HOUSING
COMMUNITIES, DESIGNATE REIMBURSED
PROPERTY TAX PAYMENTS THAT WOULD
OTHERWISE BE PAID TO THE CITY IN THE FORM
OF RESIDUAL RECEIPT PAYMENTS TO BE
REINVESTED INTO THE PROJECT, AND
AUTHORIZE THE CITY MANAGER TO EXECUTE
AGREEMENTS AND LOAN DOCUMENTS
NECESSARY TO CONSUMMATE SUCH LOAN AND
FEE PAYMENTS ON BEHALF OF THE CITY OF
SOUTH SAN FRANCISCO.
WHEREAS, in September 1998, the former Redevelopment Agency of the City of South San
Francisco ("former RDA") provided financing and entered into a loan agreement with MP Greenridge
Associates, a California limited partnership affiliated with Mid -Peninsula Housing Coalition (the
"Developer" or "MidPen") in the amount of $940,000 ("RDA Loan") to acquire and construct thirty-four
(34) multifamily residential units for very low and low income households to benefit the Agency's
Redevelopment Areas; and
WHEREAS, in January 1999, the former Redevelopment Agency of the City of South San
Francisco ("former RDA") provided financing and entered into a loan agreement with Willow Gardens
Housing Associates, a California limited partnership affiliated with Mid -Peninsula Housing Coalition
(the "Developer") in the amount of $3.5 million ("RDA Loan") to acquire and rehabilitate affordable
housing units in the Willow Gardens Neighborhood (the "Willow Gardens Project"); and
WHEREAS, in November 19, 2002, the City made an additional loan of HOME program
funds to the Developer in the original principal amount of $500,000 for the acquisition and rehabilitation
of units at the Willow Gardens Project and entered into that certain HOME Investment Partnerships
("HOME") Program Regulatory Agreement dated January 4, 1999, and recorded against the Original
Property in the Official Records of San Mateo County on March 16, 1999, as Instrument No. 99-045817;
and
WHEREAS, in connection with the Willow Gardens Project, City gave Developer a loan in the
amount of $500,000, evidenced by a Secured Promissory Note executed by Developer and dated
November 19, 2002 ("Note") and secured by a Deed of Trust, Assignment of Rents, Security Agreement
and Fixture Filing ("Deed of Trust") dated as of November 19, 2002; and
WHEREAS, the above referenced agreements for the Willow Gardens Project were amended
and a
City of South San Francisco Page 1
File Number: 21-719
Enactment Number. RES 175-2021
Modification to Regulatory Agreement and Declaration of Restrictive Covenants dated August 3, 2016
was recorded against the Original Property in the Official Records of San Mateo County on November
28, 2016, as Instrument No. 2016-124183; and
WHEREAS, in September 2019, a Second Modification was made to the Regulatory
Agreement and Declaration of Restrictive Covenants, and a Second Modification was made to the Deed
of Trust and Assignment of Rents for the 1999 Willow Gardens Neighborhood Rehabilitation Project;
and
WHEREAS, the units at Greenridge and Willow Gardens are in need of recapitalization and
renovation to support long term sustainability; and
WHEREAS, MidPen proposes that Willow Gardens and Greenridge be combined as a
scattered site low income housing tax credit (LIHTC) re -syndication to generate greater tax credit equity
enabling a more thorough renovation; and
WHEREAS, MidPen's refinance of the existing first mortgages and restructure of the City's
debt will enhance the long-term financial sustainability and the capital improvements will maintain the
long-term health of the buildings; and
WHEREAS, MidPen and the City agree to recast the Greenridge RDA Loan, WG RDA Loan,
Original HOME Loan, Original City Loan, and Second HOME Loan into a single loan, in the aggregate
principal amount of approximately $8,485,680, subject to adjustment of interest rates and the terms and
conditions of the Amended and Restated Loan Agreement, evidenced by a promissory note executed by
MidPen in favor of City and which note shall be secured by a Deed of Trust and Assignment of Rents
executed by MidPen for the benefit of City; and
WHEREAS, all prior Deeds of Trust shall each be reconveyed collectively replaced by the City
Deed of Trust; and
WHEREAS, as a condition of the Amended and Restated Loan Agreement, MidPen will
execute a new regulatory agreement which will regulate the Project for the term of the City Loan to
ensure that the units remain occupied by and affordable to Low -Income Households and execute a new
HOME regulatory agreement which will regulate the HOME -assisted units in the Project for the term of
the City Loan to ensure that such units remain occupied by and affordable to Lower -Income Households
and an Amended and Restated Rent Restriction and Right of First Refusal Agreement for Below Market
Rate Property to ensure the units remain deed restricted; and
WHEREAS, MidPen will, simultaneously with the execution of the City Regulatory
Agreement and HOME Regulatory Agreement, terminate all prior Regulatory Agreements recorded
against the project properties; and
WHEREAS, in an effort to further improve the rehabilitation efforts, the City approves use of
$294,217 of reimbursed property tax payments that would otherwise be paid to the City in the form of
residual receipt payments to be reinvested into the project for the purpose of unit improvements at the
Greenridge site; and
City of South San Francisco Page 2
File Number. 21-719
Enactment Number., RES 175-2021
WHEREAS, the City has reviewed and approved of the temporary relocation plans for current
residents of the project during the period of rehabilitation.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of South San
Francisco, as follows:
Section 1. The foregoing recitals are true and correct.
Section 2. The City Council hereby approves all Loan Agreements, Deeds of Trust, and
Regulatory Agreements attached hereto as Exhibit A for the Willow Gardens/Greenridge affordable
housing project between MP Willow Greenridge Associates, L.P., a California limited partnership.
Section 3. The City Council approves of the Subordination Agreement, hereto Attached as
Exhibit B, and the relocation plans hereto attached as Exhibit C between the City and MP Willow
Greenridge Associates, L.P., a California limited partnership.
Section 4: The City Council approves the use of $294,217 of reimbursed property tax payments
that would otherwise be paid to the City in the form of unit improvements at the Greenridge site.
BE IT FURTHER RESOLVED, by the City Council of the City of South San Francisco that
the City Council hereby authorizes the City Manager to execute all documents on behalf of the City,
subject to any minor, technical or clarifying changes that may be approved by the City Attorney, and
further authorizes the City Manager to execute all documents necessary to effectuate and carry out the
intent of this resolution.
At a meeting of the City Council on 10/13/2021, a motion was made by Vice Mayor Nagales,
seconded by Councilmember Coleman, that this Resolution be approved. The motion passed.
Yes: 5 Mayor Addiego, Vice Mayor Nagales, Councilmember Nicolas, Councilmember
Coleman, and Councilmember Flores
Attest by 0 & ae"�tL
osa Govea Acosta, City Clerk
City of South San Francisco Page 3
EXHIBIT A:
LOAN AND REGULATORY AGREEMENTS
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RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
City of South San Francisco
400 Grand Avenue
South San Francisco, CA 94080
No fee for recording pursuant to
Government Code Section 27383
APNs: 011-270-300, 011-270-170
AMENDED AND RESTATED RENT RESTRICTION AND RIGHT OF FIRST
REFUSAL AGREEMENT FOR BELOW MARKET RATE PROPERTY
This Amended and Restated Rent Restriction and Right of First Refusal Agreement for
Below Market Rate Properties (the “Agreement”) is made and entered into as of November [__],
2021, by and between the City of South San Francisco, a municipal corporation (the “City”), and
MP Willow Greenridge Associates, L.P., a California limited partnership (the “Owner”).
RECITALS
A.The Owner owns certain real property located at 364 Susie Way, City of South San
Francisco, County of San Mateo, State of California as more particularly described in Exhibit A
attached hereto (the “364 Susie Property”), and certain real property located at 383 Susie Way,
City of South San Francisco, County of San Mateo, State of California as more particularly
described in Exhibit B attached hereto (the “383 Susie Property” and collectively with the 364
Susie Property, the “Property”).
B.The 364 Susie Property is improved with a building containing four (4) dwelling
units (the “364 Susie Project”) and the 383 Susie Property is improved with a building containing
four (4) dwelling units (the “383 Susie Project,” and collectively with the 364 Susie Project, the
“Project”).
C.In accordance with Chapter 20.380 of the South San Francisco Municipal Code (the
“Inclusionary Housing Ordinance”), the 364 Susie Property is subject to that certain Rent
Restriction and Right of First Refusal Agreement for Below Market Rate Properties dated as of
June 16, 2005, and recorded in the Official Records of San Mateo county (the “Official Records”)
on July 1, 2005, as Instrument No. 2005-1110282, and that certain Rent Restriction and Right of
First Refusal Agreement for Below Market Rate Properties dated as of October 17, 2005, and
recorded in the Official Records on October 24, 2005, as Instrument No. 2005-185773
(collectively, the “364 Susie Covenants”), and the 383 Susie Property is subject to that certain Rent
Restriction and Right of First Refusal Agreement for Below Market Rate Properties dated as of
November 22, 2005, and recorded in the Official Records on November 30, 2005, as Instrument
No. 2005-209638 (the “383 Susie Covenant,” and collectively with the 364 Susie Covenants, the
“Existing Covenants”).
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D.The City and the Owner desire to amend and restate the Existing Covenants, in their
entirety, as more fully set forth herein.
NOW THEREFORE, in consideration of the recitals hereof, and other mutual covenants
and promises contained herein and for other valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the City and the Owner hereby agree as follows:
ARTICLE 1
DEFINITIONS
1.1 Definitions.
When used in this Agreement, the following terms shall have the respective meanings
assigned to them in this Article 1.
(a)“60% AMI Household” shall mean a household with an Adjusted Income,
adjusted for household size, that does not exceed 60% of Area Median Income.
(b) “60% AMI Rent” shall mean the maximum allowable rent for a 60% AMI
Household pursuant to Section 2.2(b) below.
(c)“70% AMI Household” shall mean a household with an Adjusted Income,
adjusted for household size, that does not exceed 70% of Area Median Income.
(d) “70% AMI Rent” shall mean the maximum allowable rent for a 70% AMI
Household pursuant to Section 2.2(c) below.
(e)“90% AMI Household” shall mean a household with an Adjusted Income,
adjusted for household size, that does not exceed 90% of Area Median Income.
(f)“90% AMI Rent” shall mean the maximum allowable rent for a 90% AMI
Household pursuant to Section 2.2(d) below.
(g) “110% AMI Household” shall mean a household with an Adjusted Income,
adjusted for household size, that does not exceed 110% of Area Median Income.
(h) “110% AMI Rent” shall mean the maximum allowable rent for a 110% AMI
Household pursuant to Section 2.2(e) below.
(i)“Adjusted Income” shall mean the total anticipated annual income of all
persons in a household as calculated in accordance with 24 CFR 92.203(b)(l), which incorporates
24 CFR 5.609m.
(j)Agreement” shall mean this Amended and Restated Rent Restriction and
Right of First Refusal Agreement for Below Market Rate Properties.
(k) “Area Median Income” shall mean the median gross yearly household
income, adjusted for household size for San Mateo County, as published from time to time by
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HUD. In the event that such income determinations are no longer published by HUD, or are not
updated for a period of at least eighteen (18) months, the City shall provide the Owner with other
income determinations which are reasonably similar with respect to methods of calculation to those
previously published by HUD.
(l) “Assumed Household Size” shall mean, solely for the purposes of
establishing maximum rent limits for the Below Market Rate Units, a household size equal to the
number of bedrooms in the Unit, times one and a half. For example, the Assumed Household Size
for a two-bedroom unit shall be a household of three. Assumed Household Size is not intended to
be used as a maximum occupancy limit for the Units.
(m) “Below Market Rate Units” shall mean the four (4) dwelling units within
the 364 Susie Project and two (2) dwelling units within the 383 Susie Project.
(n) “City” shall mean the City of South San Francisco, a municipal corporation.
(o) “Household Size” shall mean the actual number of persons in the applicant
or Tenant household.
(p) “HUD” means the United States Department of Housing & Urban
Development.
(q) “Inclusionary Housing Ordinance” shall have the meaning set forth in
Recital C above.
(r) “Owner” shall mean MP Willow Greenridge Associates, L.P., a California
limited partnership.
(s) “Project” shall have the meaning set forth in Recital B above.
(t) “Property” shall mean the real property described in Exhibits A and B
attached hereto and incorporated herein.
(u) “Rent” shall mean the total of monthly payments by the Tenant of a Below
Market Rate Unit for the following: use and occupancy of the Unit and land and associated
facilities, including parking; any separately charged fees or service charges assessed by the Owner
which are required of all Tenants, other than security deposits; an allowance for the cost of an
adequate level of service for utilities paid by the Tenant, including electricity, gas and other
heating, cooking and refrigeration fuel, but not telephone service or cable TV; and any other
interest, taxes, fees or charges for use of the land or associated facilities and assessed by a public
or private entity other than the Owner, and paid by the Tenant.
(v) “Tenant” shall mean a household lawfully occupying a Unit subject to a
valid lease.
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(w) “Term” shall mean the term of this Agreement, which shall commence on
the date of this Agreement and shall continue until May 3, 2062, or a specified later date in the
event the City and Owner agree to extend such term.
(x) “Unit” for leasing and management purposes, shall mean one of the eight
(8) apartments in the Property. Six (6) of the Units, pursuant to Section 2.1 below, are required to
be occupied by, or if vacant available for occupancy by 60% AMI, 70% AMI, 90% AMI, 110%
AMI and Very Low Income Households.
(y) “Very Low Income Household” shall mean a household with an Adjusted
Income, adjusted for household size, that does not exceed 50% of Area Median Income.
(z) “Very Low Income Rent” shall mean the maximum allowable rent for a
Very Low Income Household pursuant to Section 2.2(a) below.
ARTICLE 2
AFFORDABILITY AND OCCUPANCY COVENANTS
2.1 Occupancy Requirements.
(a) Below Market Rate Units. One (1) of the Below Market Rate Units at the
364 Susie Project shall be rented to and occupied by or, if vacant, available for occupancy by a
60% AMI Household, one (1) of the Below Market Rate Units at the 364 Susie Project shall be
rented to and occupied by or, if vacant, available for occupancy by a 70% AMI Household, one
(1) of the Below Market Rate Units at the 364 Susie Project shall be rented to and occupied by or,
if vacant, available for occupancy by a 90% AMI Household, one (1) of the Below Market Rate
Units at the 364 Susie Project shall be rented to and occupied by or, if vacant, available for
occupancy by a 110% AMI Household, and the two (2) Below Market Rate Units at the 383 Susie
Project shall be rented to and occupied by or, if vacant, available for occupancy by Very Low
Income Households in accordance with Exhibit C. The foregoing requirements shall not preclude
the Owner from complying with more restrictive income and/or rent limits that may apply to one
or more of the six (6) Below Market Rate Units during the term of any other regulatory agreement
recorded against the Property currently, or subsequently to be recorded, with prior City approval,
for the purposes of ensuring the affordability of the units and/or establishing deeper affordability
targeting requirements.
2.2 Allowable Rent.
(a) Very Low Income Rent. Rents (including utility allowance) charged to
Tenants of the Very Low Income Household Below Market Rate Units shall not exceed the 50%
AMI rent limit published annually by HUD. In the event that HUD no longer publishes such rent
limit, the rents for Very Low Income Household Units shall not exceed one-twelfth (1/12) of thirty
percent (30%) of fifty percent (50%) of Area Median Income for the Assumed Household Size, as
further set forth in Exhibit C.
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(b) 60% AMI Rent. Rents (including utility allowance) charged to Tenants of
the 60% AMI Household Below Market Rate Unit shall not exceed the 60% AMI rent limit
published annually by HUD. In the event that HUD no longer publishes such rent limit, the rents
for 60% AMI Household Units shall not exceed one-twelfth (1/12) of thirty percent (30%) of sixty
percent (60%) of Area Median Income for the Assumed Household Size, as further set forth in
Exhibit C.
(c) 70% AMI Rent. Rents (including utility allowance) charged to Tenants of
the 70% AMI Household Below Market Rate Unit shall not exceed one-twelfth (1/12) of thirty
percent (30%) of seventy percent (70%) of Area Median Income for the Assumed Household Size,
as further set forth in Exhibit C.
(d) 90% AMI Rent. Rents (including utility allowance) charged to Tenants of
the 90% AMI Household Below Market Rate Unit shall not exceed one-twelfth (1/12) of thirty
percent (30%) of ninety percent (90%) of Area Median Income for the Assumed Household Size,
as further set forth in Exhibit C.
(e) 110% AMI Rent. Rents (including utility allowance) charged to Tenants of
the 110% AMI Household Below Market Rate Unit shall not exceed one-twelfth (1/12) of thirty
percent (30%) of one hundred ten percent (110%) of Area Median Income for the Assumed
Household Size, as further set forth in Exhibit C.
(f) Housing Assistance Payment Contracts; Project Based Vouchers. In the
event that some or all of the Below Market Rate Units are subject to a valid Housing Assistance
Payment (“HAP”) contract with HUD and/or the San Mateo County Housing Authority (including
a HAP contract in connection with tenant-based Housing Choice Vouchers), the allowable Rent
may be determined by the parties to the HAP contract and may exceed the allowable Rent set forth
above. Owner shall provide notice to the City that a HAP contract has been executed, and such
notice shall identify which units will be subject to the HAP contract, and the term of HAP contract
applicable to each Unit. Executed HAP contract(s) shall be made available for City inspection
upon request. Under applicable federal law, prior to the expiration of any HAP assistance, Owner
shall notify Tenant that their Rent may be increased to the applicable allowable Rent limit specified
herein.
(g) Hold Harmless. Notwithstanding anything to the contrary contained herein,
with respect to the Area Median Income determination under this Agreement, the City shall allow
Owner to apply the same “hold harmless” policy implemented by the California Tax Credit
Allocation Committee in the event that the Area Median Income decreases in any given calendar
year.
(h) Inclusionary Housing Ordinance. Notwithstanding anything contained
herein to the contrary, in accordance with Section 20.380.006(D) of the Inclusionary Housing
Ordinance, no Tenant of any Below Market Rate Unit shall be obligated to pay rent for a Below
Market Rate Unit in an amount greater than ninety percent (90%) of the market rental rate for such
Unit.
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2.3 Increased Income of Tenants.
(a) Non-Qualifying Households in Below Market Rate Units. If, upon
recertification of the income of a Tenant of a Below Market Rate Unit, the Owner determines that
such Tenant’s Adjusted Income has increased and exceeds the income limit for a Very Low
Income, 60% AMI, 70% AMI, 90% AMI or 110% AMI Household, as applicable, then, upon sixty
(60) days’ written notice to Tenant and subject to Section 2.2(h) above, such Tenant’s rent may be
increased to 30% of the Tenant’s actual monthly household income or to a comparable rent for
Very Low Income, 60% AMI, 70% AMI, 90% AMI or 110% AMI Households, as applicable,
occupying units of comparable size. If such an increase is expressly prohibited under a deed
restriction of a lienholder senior to this Agreement, or federal IRS tax credit regulations applicable
to the Property at the time, the rent shall remain at the then-current rent limit applicable such Unit
and the number of Units occupied by Tenants with incomes over the applicable rent limit shall be
reported to the City on an annual basis in Owner’s annual reports to the City as required under
Section 3.2 herein.
(b) Over Income Households. Notwithstanding anything to the contrary
contained herein, if any household’s income has been determined to be at or above 120% of Area
Median Income for two consecutive annual income certifications, Owner may terminate such
tenant’s lease with a six (6) month notice to vacate.
(c) Termination of Occupancy. Upon termination of occupancy of a Below
Market Rate Unit by a Tenant, such Below Market Rate Unit shall be deemed to be continuously
occupied by a household of the same income level (e.g., Very Low Income Household) as the
initial income level of the vacating Tenant if such Unit is re-occupied by a household of the same
income level within 120 days of vacancy of the Unit by the prior Tenant, at which time the status
of the Unit shall be determined based on the income level of the new Tenant.
2.5 Persons residing on the Property as of the date of this Agreement shall not be
displaced before suitable replacement housing is available in comparable replacement housing.
Owner shall ensure that all occupants of the Property receive all notices, benefits and assistance to
which they are entitled in accordance with California Relocation Assistance Law (Government
Code Section 7260 et seq.), all state and local regulations implementing such law, and all other
applicable local, state and federal laws and regulations (collectively “Relocation Laws”) relating
to the displacement and relocation of eligible persons as defined in such Relocation Laws.
Any and all costs incurred in connection with the temporary and/or permanent
displacement and/or relocation of occupants of the Property, including without limitation
payments to a relocation consultant, moving expenses, and payments for temporary and permanent
relocation benefits pursuant to Relocation Laws shall be paid by Owner. Owner shall indemnify,
defend (with counsel approved by City) and hold harmless the Indemnitees (as defined in Section
6.15) from and against any and all Claims (as defined in Section 6.15) arising in connection with
the breach of Owner’s obligations set forth in this Section except to the extent such Claims arise
from the gross negligence or willful misconduct of the Indemnitees. Owner’s indemnification
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obligations set forth in this Section 2.5 shall survive the expiration or earlier termination of this
Agreement.
2.6 Occupancy Procedures. The Owner shall adopt written tenant selection policies
and criteria for the Units that:
(a) Are consistent with the purpose of providing housing for Very Low Income,
60% AMI, 70% AMI, 90% AMI and110% AMI Households;
(b) Are reasonably related to program eligibility and the applicants’ ability to
perform the obligations of the lease; and
(c) Provide for:
(i) The selection of tenants from a written waiting list in the
chronological order of their application, applying the local preference as outlined in this
Agreement, insofar as is practicable and compliant with applicable laws and regulations; and
(ii) The prompt written notification to any rejected applicant of the
grounds for any rejection.
2.7 Security Deposits. Any security deposits collected by the Owner or Owner’s agent
shall be kept separate and apart from all other funds of the Property in a trust account with a
depository insured by the Federal Deposit Insurance Corporation, or other comparable federal
deposit insurance program, and shall be held and disbursed in accordance with California law. If
required by the locality, the balance of such amount shall at all times equal or exceed the aggregate
of all outstanding obligations under said account, plus accrued interest thereon.
ARTICLE 3
INCOME CERTIFICATION AND REPORTING
3.1 Income Certification.
The Owner will obtain, complete and maintain on file, immediately prior to initial
occupancy and annually thereafter, income certifications from each Tenant renting any of the
Units. The Owner shall make a good faith effort to verify that the income provided by an applicant
or occupying household in an income certification is accurate by taking two or more of the
following steps as a part of the verification process: (a) obtain a pay stub for the most recent pay
period; (b) obtain an income tax return for the most recent tax year; (c) conduct a credit agency or
similar search; (d) obtain an income verification form from the applicant’s current employer; (e)
obtain an income verification form from the Social Security Administration and/or the California
Department of Social Services if the applicant receives assistance from either of such agencies; or
(f) if the applicant is unemployed and has no such tax return, obtain another form of independent
verification. Copies of Tenant income certifications shall be available to the City upon request.
Initial household income certification shall be consistent with the “Part 5 Method” described
in 24 CFR 5.609.
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In the event that annual recertification of Tenant incomes indicates that the number of
Below Market Rate Units actually occupied by Very Low Imcome, 60% AMI Households, as
applicable, falls below the number reserved for each income group as specified in Exhibit C
attached hereto, Owner shall rectify the condition by renting the next available dwelling unit(s) in
the Project to a Low, 60%, or Very Low Income Household(s), as applicable, until the required
income mix is achieved.
3.2. Annual Report to the City.
The Owner shall file with the City an annual report, no later than 120 days following the
end of each calendar year. The report shall contain a certification by the Owner as to such
information as the City may then require including, but not limited to, the following:
(a) The substantial physical defects in the Property, including a description of
any major repair or maintenance work undertaken or needed in the previous and current fiscal
years. Such statement shall describe what steps the Owner has taken in order to maintain the
Property in a safe and sanitary condition in accordance with applicable housing and building codes.
(b) The occupancy of the Property including (i) the verified income of each
current household; and (ii) the current rent charged each household and whether these rents include
utilities.
(c) A summary of the information received from the recertification of Tenants’
incomes.
(d) Other information reasonably required by the City, including the fiscal
condition of the Owner showing a financial statement for the previous fiscal year that includes a
balance sheet and a profit and loss statement indicating any surplus or deficit in operating accounts;
a detailed, itemized listing of income and expenses; the amount of any fiscal reserves and the total
amount of Residual Receipts (as defined in the Note) received. Such financial statement shall be
prepared in accordance with the requirements of the City. The City may require that the financial
statement be audited at the Owner’s expense by an independent certified public accountant
acceptable to the City, or other person designated by the City, if City reasonably determines that
audit is deficient.
3.3 Additional Information.
The Owner shall provide any additional information reasonably requested by the City to
the City. The City shall have the right to examine and make copies of all books, records or other
documents of the Owner which pertain to the Project.
3.4 Records.
The Owner shall maintain complete, accurate and current records pertaining to the Project,
and shall permit any duly authorized representative of the City to inspect records, including records
pertaining to income of Tenants. All Tenant lists, applications and waiting lists relating to the
Project shall at all times be kept separate and identifiable from any other business of the Owner
and shall be maintained as required by the City, in a reasonable condition for proper audit and
subject to examination during business hours by representatives of the City. The Owner shall
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retain copies of all materials obtained or produced with respect to occupancy of the Units for a
period of at least five (5) years.
3.5 On-site Inspection.
The City shall each have the right to perform an on-site inspection of the Project at least
one time per year with adequate notice to Owner, a minimum of thirty (30) days. The Owner
agrees to cooperate in such inspection.
ARTICLE 4
PROPERTY MAINTENANCE
4.1 Property Maintenance.
The Owner agrees, for the entire Term of this Agreement, to maintain all interior and
exterior improvements, including landscaping, on the Property in good condition and repair (and,
as to landscaping, in a healthy condition), reasonable wear and tear excepted, and in accordance
with all applicable laws, rules, ordinances, orders and regulations of all federal, state, City,
municipal, and other governmental agencies and bodies having or claiming jurisdiction and all
their respective departments, bureaus, and officials. The Owner shall make all repairs and
replacements necessary to keep the improvements in good condition and repair. Owner shall
prevent and/or rectify any physical deterioration of the Property and the Project and shall make all
repairs, renewals and replacements necessary to keep the Property and the improvements located
thereon in good condition and repair.
4.2 City Right to Perform Maintenance.
In the event that Owner breaches any of the covenants contained in Section 4.1, and such
default continues for a period of ten (10) days after written notice from City (with respect to
graffiti, debris, and waste material) or thirty (30) days after written notice from City (with respect
to landscaping, building improvements and general maintenance), then City, in addition to any
other remedy it may have under this Agreement or at law or in equity, shall have the right, but not
the obligation, to enter upon the Property and perform all acts and work necessary to protect,
maintain, and preserve the improvements and the landscaped areas on the Property. All costs
expended by City in connection with the foregoing, shall be paid by Owner to City upon demand.
Notwithstanding anything to the contrary set forth in this Section, City agrees that it will provide
Owner with not less than thirty (30) days’ written notice prior to undertaking any work for which
Owner will incur a financial obligation.
ARTICLE 5
RIGHT OF FIRST REFUSAL
5.1 Right of First Refusal.
Owner shall provide City (or its designee or assignee), a first right of refusal to purchase
the Property containing the Below Market Rate Units if it, or the individual Units, are offered
for sale at any point during the Term. Except as provided herein, Owner hereby grants and gives
the City (or its designee or assignee) a right of first refusal to purchase the Property or individual
Units on and subject to the conditions set forth in this Article 5 (the “Right of First Refusal”).
5.2 Below Market Rate Unit Resale Procedures.
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(a) Notice of Offer to Sell. Whenever the Owner no longer desires to own the
Property, Owner shall notify City of their intent to offer the Property for sale in accordance with
the terms of this Agreement. Such notice shall be delivered in accordance with Section 6.9 below.
Owner’s offer to sell may be withdrawn by Owner, provided that notice of withdrawal has been
received by City (or its designee or assignee), in writing, prior to acceptance by City (or its
designee or assignee). Such notice from Owner to City shall contain the price under which the
Owner desires to sell the Property.
(b) Acceptance. City (or its designee or assignee) shall have thirty (30) days
from the date of receipt of Owner’s notice under Section 5.2(a) to accept Owner’s offer to sell
the Property. This acceptance shall be in writing and indicate whether the City is accepting the
offer to sell at the requested price or whether the City is proposing a counteroffer in accordance
with Section 5.3(b) below. The acceptance shall be delivered to Owner in the manner set forth in
Section 6.9 below. For purposes of fulfillment of the terms of this procedure, the notice of intent
to sell the premises shall be deemed to be an offer to sell, and the exercise of the right to purchase
by the City (or its designee or assignee) shall be deemed to be an acceptance of that offer.
Subject to Section 5.3, acceptance by City (or its designee or assignee) shall constitute a legally
binding contract for the transfer of title, and once accepted, the offer to sell may not be withdrawn
without the express, written consent of the party who accepted the offer.
(c) Escrow. Within sixty (60) days of the date of acceptance, subject to the
parties having mutually agreed upon a Purchase Price (as defined below) as set forth in Section
5.3, an escrow account shall be opened by the City (or its designee or assignee). City reserves the
right, at any time during this process, to subsequently assign its right to purchase to its designee
or assignee. Once opened, an escrow must be closed within thirty (30) days, unless both parties
mutually agree, in writing, to an extension of time. In no case shall the time between receipt of
an offer to sell and the date of close of escrow exceed ninety (90) days, unless both parties
mutually agree, in writing, to extend that date, or if for any reason the time periods herein are
tolled. In the event the City (or its designee or assignee) purchases the Property or individual
Below Market Rate Units pursuant to this section, the City (and its designee or assignee) shall
release Owner from all obligations under this Agreement. Once escrow is opened, in the event the
City (or its designee or assignee) fails to complete actions to close escrow (for the purchase of the
Property or individual Below Market Rate Units), through no fault of the Owner, the City shall
release the Owner from the Right of First Refusal obligations under this Agreement
(d) Transfer by Owner if Right of First Refusal Not Exercised. In the event
the City (or its designee or assignee) does not exercise its Right of First Refusal within thirty (30)
days of the Owner’s notice pursuant to Section 5.2 above, the Owner may offer the Property for
sale to any buyer as set forth in Section 5.3(b)(i) below. The proposed buyer must purchase the
property subject to the terms of this Agreement and will be required to execute, acknowledge and
record a written assumption agreement under which the transferee shall assume the obligations
and duties of the Owner under this Agreement and agree to be bound by the terms of this
Agreement.
(e) Owner’s Obligation to Cooperate. At all times, Owner shall make
11
reasonable efforts to ensure that the Property are clean and in good repair, and reasonably
available to be shown to the City (or its designee or assignee) subject to rights of the Tenants.
Owner shall reasonably cooperate with the City and its officers, employees and representatives.
Failure to comply with these conditions shall be deemed a material breach of Owner’s obligations
pursuant to the terms of this Agreement, and upon determination by the City that Owner has
failed to comply with any of the above conditions, City shall notify Owner that the time periods
stated herein shall be tolled and the applicable time periods extended accordingly, until Owner
has complied with all of the conditions of this Agreement. Acts by Owner which shall be deemed
to be a breach of this obligation include, but are not limited to, failure to make the Property
available for showing to the City (or its designee or assignee) upon reasonable notice subject to
the rights of Tenants, willful or deliberate actions to dissuade prospective buyers from purchasing
the Property, failure or refusal to return telephone calls within a reasonable amount of time, and
failure to complete forms, provide required reports, or perform other actions ordinarily required
by a party to a real estate transaction in a timely manner. In addition to tolling the applicable
time periods, the City may pursue any other remedies for breach based upon this section.
5.3 Purchase Price.
(a) Purchase Price Generally. The purchase price for the Property (the
“Purchase Price”) shall be the price at which Owner offered to sell the property or the price as
determined by Section 5.3(b) below. The Purchase Price shall be paid in cash or by a check issued
by the City at the close of escrow or as otherwise mutually agreed upon by City (or its designee
or assignee) and Owner.
(b) Negotiated Purchase Price. If the City does not accept Owner’s offer to
sell at the purchase price set forth in the Owner’s notice under Section 5.2, the City shall have the
option of submitting a counteroffer. Said counteroffer shall not in any way be deemed an
acceptance of the Owner’s price. The City’s counteroffer may be based on the appraised fair
market value, as established by an appraiser of City’s choice (“City Appraisal”).
(i) If an agreement cannot be reached between the City and the Owner
as to the Purchase Price within ninety (90) days from and after City’s acceptance as provided in
Section 5.2(b), Owner may then offer the Property (or individual Below Market Rate Units
subject to Section 5.8) for sale to any buyer for a period of eight (8) months (the “Option Period”).
(ii) During the Option Period, City shall waive, in writing, its Right of
First Refusal; provided, however, that if the City’s counteroffer is based upon a City Appraisal,
then the City shall waive such rights if and only if a prospective buyer’s offer to purchase the
Property exceeds the City Appraisal value by more than ten percent (10%). If said sale to a
prospective buyer is not consummated by placing earnest money into escrow during the Option
Period, all parts of this Agreement shall remain in force and the City shall retain its Right of
First Refusal.
(iii) The time period during which the City (or its designee or assignee)
has the option to perform pursuant to this Agreement shall be tolled for the time the City and the
Owner negotiate the Purchase Price, but said tolling period shall not exceed thirty (30) days
12
unless both parties mutually agree, in writing, to extend the time period.
5.4 Wood Destroying Pests and Organisms. Owner shall bear the expense of
providing a current written report of an inspection by a licensed Structural Pest Control Operator.
All work recommended in said report to repair damage caused by infestation or infection of wood-
destroying pests or organisms found and all work to correct conditions that caused such infestation
or infection (“Pest Work”) shall be done at the expense of the Owner. At close of escrow Owner
shall monetarily credit City (or its designee or assignee) for any Pest Work Owner did not
complete prior to the close of escrow. Any work to correct conditions usually deemed likely to
lead to infestation or infection of wood-destroying pests or organisms, but where no evidence
of infestation or infection is found with respect to such conditions, is not the responsibility of the
Owner, and such work shall be done only if requested by the City (or its designee or assignee) and
then at the expense of the City (or its designee or assignee).
5.5 Real Estate Transfer Disclosure Statement. Owner is obligated to provide the City
with a full disclosure of the condition of the premise under Civil Code Section 1102, et seq. The
City will provide the Owner with a Real Estate Transfer Disclosure form which shall be
completed by the Owner and submitted to the City with the Owner’s notice of intent to sell.
5.6 Property Deficiencies. Upon receipt of notice of Owner’s intent to sell, City (or
its designee or assignee) shall be entitled, upon reasonable notice, to inspect the Property to
determine whether any violations of applicable building, plumbing, electric, fire, or housing
codes or any other provisions of Title 16 of the South San Francisco Municipal Code
(“Deficiencies”) exist. City (or its designee or assignee) shall have a report (the “Deficiencies
Report”) prepared and shall deliver said report to Owner. In the event Deficiencies are noted in
the Deficiency Report, the City (or its designee or assignee) shall obtain cost estimates to cure
the Deficiencies. The Owner shall cure the Deficiencies in a reasonable manner acceptable to
City (or its designee or assignee) within sixty (60) days of receiving the Deficiency Report, but in
no event later than close of escrow. Should Owner fail to cure such Deficiencies prior to the
scheduled date of close of escrow, the City (or its designee or assignee) shall receive a credit
against the Purchase Price in the amount of the estimated cost of all Deficiency repairs Owner did
not complete prior to the close of escrow.
5.7 Assignment of Right to Purchase. In no event shall City become in any way liable
to Owner, nor become obligated in any manner, by reason of the assignment of its right to
purchase, nor shall City be in any way obligated or liable to Owner for any failure of City’s
designee or assignee to consummate a purchase of the Property or to comply with the terms of
any purchase and sale agreement. Nothing in this Agreement shall be construed to obligate City
to purchase the Property in the event that its designee or assignee fails to complete actions to
close escrow.
5.8 Sale of Individual Units. If Owner or any subsequent purchaser of the Project sells
any Below Market Rate Unit as an individual condominium, cooperative or tenancy in common
unit before the end of the Term, the City shall record a resale restriction with a term of fifty-five
(55) years from the date of recordation, against said Unit(s) upon the close of escrow for said
Unit(s), so that said Unit(s) shall remain affordable to subsequent income eligible buyers for a term
13
of fifty-five (55) years. Notwithstanding the foregoing, in the event of a sale of all of the Below
Market Rate Units to a third party at one time solely for purposes of the continued rental and
management of the Below Market Rate Units, the requirement hereunder to record the 55-year
resale restriction shall not apply.
ARTICLE 6
MISCELLANEOUS
6.1 Term.
The provisions of this Agreement shall apply to the Property for the entire Term. This
Agreement shall bind any successor, heir or assign of the Owner, whether a change in interest
occurs voluntarily or involuntarily, by operation of law or otherwise, except as expressly released
by the City.
6.2 Covenants to Run With the Land.
The City and the Owner hereby declare their express intent that the covenants and
restrictions set forth in this Agreement shall run with the land, and shall bind all successors in title
to the Property, provided, however, that on the expiration of the Term of this Agreement said
covenants and restrictions shall expire. Each and every contract, deed or other instrument hereafter
executed covering or conveying the Property or any portion thereof, shall be held conclusively to
have been executed, delivered and accepted subject to such covenants and restrictions, regardless
of whether such covenants or restrictions are set forth in such contract, deed or other instrument,
unless the City expressly releases such conveyed portion of the Property from the requirements of
this Agreement. This Section 6.2 shall be subject to the rights of any lender with a lien senior to
this Agreement.
6.3 Enforcement by the City.
If the Owner fails to perform any obligation under this Agreement, and fails to cure the
default within thirty (30) days after the City has notified the Owner in writing of the default or, if
the default cannot be cured within thirty (30) days, fails to commence to cure within thirty (30)
days and thereafter diligently pursue such cure and complete such cure within ninety (90) days,
the City shall have the right to enforce this Agreement by any or all of the following actions, or
any other remedy provided by law, subject to the rights of any lenders with liens senior to this
Agreement:
(a) Collect Rents. Collect all rents and income in connection with the operation
of the Project and use the same and the reserve funds for the operation and maintenance of the
Project.
(b) Excess Rents. In the event that the breach or violation involves the rents to
tenants or other charges in excess of those permitted under this Agreement, the City may demand,
and seek as an additional remedy, the return of such excess rents or other charge to the affected
households.
(c) Action to Compel Performance or for Damages. The City may bring an
action at law or in equity to compel the Owner’s performance of its obligations under this
14
Agreement, and/or for damages, or for the appointment of a receiver to take over and operate the
Project in accordance with the terms of this Agreement or for such other relief as may be
appropriate.
(d) Remedies Cumulative. The remedies of the City hereunder are cumulative,
and the exercise of one or more of such remedies shall not be deemed an election of remedies and
shall not preclude the exercise by the City of any one or more of its other remedies.
6.4 Attorneys’ Fees and Costs.
In any action brought to enforce this Agreement, the prevailing party shall be entitled to all
costs and expenses of suit, including reasonable attorneys’ fees. This section shall be interpreted
in accordance with California Civil Code Section 1717 and judicial decisions interpreting that
statute.
6.5 Recording and Filing.
The City and the Owner shall cause this Agreement, and all amendments and supplements
to it, to be recorded in the Official Records. Concurrently with the recording of this Agreement,
the City and the Owner shall cause the Existing Covenants to be terminated.
6.6 Governing Law.
This Agreement shall be governed by the laws of the State of California.
6.7 Waiver of Requirements.
Any of the requirements of this Agreement may be expressly waived by the City in writing,
but no waiver by the City of any requirement of this Agreement shall, or shall be deemed to, extend
to or affect any other provision of this Agreement.
6.8 Amendments.
This Agreement may be amended only by a written instrument executed by all the parties
hereto or their successors in title, and duly recorded in the real property records of the County of
San Mateo.
6.9 Notices.
Any notice requirement set forth herein shall be deemed to be satisfied three (3) days after
mailing of the notice first-class United States certified mail, postage prepaid, addressed to the
appropriate party as follows:
Owner: MP Willow Greenridge Associates, L.P.
303 Vintage Park Drive, Suite 250
Foster City, California 94404
Attention: Assistant Secretary
With a copy to: Hudson SLP LLC
c/o Hudson Housing Capital LLC
630 Fifth Avenue, 28th Floor
New York, New York 10111
15
Attention: Joseph A. Macari
City: City of South San Francisco
400 Grand Avenue
South San Francisco, CA 94080
Such addresses may be changed by notice to the other party given in the same manner as provided
above.
6.10 Severability.
If any provision of this Agreement shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining portions of this Agreement shall not in any way be
affected or impaired thereby.
6.11 Multiple Originals; Counterparts.
This Agreement may be executed in multiple originals, each of which is deemed to be an
original, and may be signed in counterparts.
6.12. Captions. The captions used in this Agreement are inserted only as a matter of
convenience and for reference and in no way define, limit or describe the scope or the intent of
this Agreement.
6.13. Assignment of City’s Rights. The City retains the right, at its sole discretion, to
assign all or part of its rights under this Agreement for the purpose of ensuring compliance and
enforcement of the Owner’s duties and obligations hereunder. In addition, the City may designate
an agent to act on its behalf in monitoring compliance and enforcing the provisions hereof.
6.14. Binding on Successors. This Agreement shall bind, and benefits thereof shall inure
to, the respective parties hereto, their legal representatives, executors, administrators, successors
in interest, and assigns, provided, however, that the Owner may not assign this Agreement or any
of its obligations hereunder, voluntarily or by operation of law, without the prior written approval
of the City.
6.15. Hold Harmless. Owner shall indemnify, defend (with counsel approved by the
City), and hold the City and its elected and appointed officers, officials, employees, contractors,
agents, and representatives (all of the foregoing, collectively the “Indemnitees”) harmless from
and against any and all liabilities, losses, damages, fines, deficiencies, penalties, claims, demands,
suits, actions, causes of action, legal or administrative proceedings, judgments, costs and expenses
(including without limitation reasonable attorneys’ fees and court costs) (all of the foregoing,
collectively “Claims”) arising directly or indirectly in any manner in connection with or resulting
from, (a) any failure of any of Owner’s representations or warranties set forth in this Agreement,
or made by Owner in connection with the execution and delivery of this Agreement or in any
certificate furnished pursuant hereto, to be correct in all material respects; (b) any contract for
services entered into between Owner and a third party, or services provided to Owner by a third
party, related to the Project; and (c) any claim, demand or cause of action, or any action or other
proceeding, whether meritorious or not, brought or asserted against any Indemnitee which relates
16
to or arises in connection with the Agreement or any transaction contemplated thereby. Owner’s
obligations under this Section shall survive expiration or termination of this Agreement. Owner’s
indemnity obligations shall not apply to Claims arising solely as a result of the willful misconduct
or gross negligence of the Indemnitees.
6.16. Restrictions on Sale, Encumbrance, and Other Acts.
(a) Except for leases to tenants in the ordinary course of business, the Owner
shall not make, or allow, any sale, encumbrance, hypothecation, assignment, pledge, conveyance,
or transfer in any form of the Project or of any of its interest therein, except with the prior written
approval of the City and, if applicable, in accordance with Article 5. Notwithstanding the previous
sentence, or anything contained in this Agreement to the contrary, the following transfers are
hereby approved by the City and shall not be subject to the provisions of Article 5: (a) the transfer
of the Project to a limited partnership, the general partner of which is an affiliate of Owner; (b) the
transfer of limited partnership interests in the Owner; (c) the removal and replacement of the
general partner for cause in accordance with the terms of the limited partnership agreement of
Owner; (d) the grant and exercise of an option or right of first refusal in favor of Owner’s general
partner or an affiliate thereof and (e) a deed of trust encumbering the Property granted in
connection with any other loan provided for the Project (including but not limited to the
construction loan provided by Capital One, National Association and the permanent financing loan
provided by First Republic Bank), and any transfer of the Project thereunder, by foreclosure, deed
in lieu of foreclosure, or an assignment in lieu of foreclosure, or to a third-party purchaser pursuant
to a foreclosure sale thereunder.
(b) The City shall approve a sale, transfer or conveyance and shall agree to
waive its rights under Article 5 provided that all of the following conditions are met:
(1) the Owner is in compliance with this Agreement or the sale, transfer
or conveyance will result in the cure of any existing violations of the Agreement;
(2) the successor-in-interest to the Owner agrees to assume all
obligations of the Owner pursuant to this Agreement;
(3) any successor-in-interest demonstrates to the City’s satisfaction that
it has the management and financial capacity to own and operate the Project; and
(4) Owner uses its best efforts to ensure that all deeds of trust or other
security instruments recorded after the date of this Agreement against the Property, the Project or
part thereof for the benefit of a lender other than City (“Third Party Lender”) shall contain each of
the following provisions: (i) Third-Party Lender shall use its best efforts to provide to City a copy
of any notice of default issued to Owner concurrently with provision of such notice to Owner; (ii)
City shall have the reasonable right, but not the obligation, to cure any default by Participant within
the same period of time provided to Owner for such cure extended by an additional 90 days; (iii)
provided that City has cured any default under Third-Party Lender’s deed of trust and other loan
documents, City shall have the right to foreclose City’s Deed of Trust and take title to the Project
without acceleration of Third-Party Lender’s debt; and (iv) City shall have the right to transfer the
17
Project without acceleration of Third-Party Lender’s debt to a nonprofit corporation or other entity
which shall own and operate the Project as an affordable rental housing Project, subject to the prior
written consent of the Third-Party Lender. Owner agrees to provide to City a copy of any notice
of default Owner receives from any Third-Party Lender within three (3) business days following
Owner’s receipt thereof.
[remainder of page left intentionally blank; signature page follows]
18
IN WITNESS WHEREOF, the City and the Owner have executed this Agreement by
duly authorized representatives, all on the date first written above.
OWNER:
MP WILLOW GREENRIDGE
ASSOCIATES, L.P., a California limited
partnership
By: MP Greenridge LLC, a California
limited liability company, its general
partner
By: Mid-Peninsula Half Moon Bay,
Inc., a California nonprofit public
benefit corporation, its sole
member/manager
By: _______________________
Jan M. Lindenthal
Assistant Secretary
APPROVED AS TO FORM:
By: _____________________________
City Attorney
CITY:
CITY OF SOUTH SAN FRANCISCO, a
municipal corporation
By: ________________________________
Its: ________________________________
A Notary Public or other officer completing this certificate verifies only the identity of the individual who signed the
document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
STATE OF CALIFORNIA )
COUNTY OF SAN MATEO )
On ____________________, before me, ___________________________, Notary Public,
personally appeared , who proved
to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to
the within instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the
person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify UNDER PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature (Seal)
A Notary Public or other officer completing this certificate verifies only the identity of the individual who signed the
document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
STATE OF CALIFORNIA )
COUNTY OF SAN MATEO )
On ____________________, before me, ___________________________, Notary Public,
personally appeared , who proved
to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to
the within instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the
person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify UNDER PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature (Seal)
EXHIBIT A
Legal Description of 364 Susie Property
Real property in the City of South San Francisco, County of San Mateo, State of California,
described as follows:
LOT 21 IN BLOCK 2, AS SHOWN ON THAT CERTAIN MAP ENTITLED “WILLOW
GARDENS”, FILED IN THE OFFICE OF THE RECORDER OF THE COUNTY OF SAN
MATEO, STATE OF CALIFORNIA, ON DECEMBER 29, 1964 IN BOOK 61 OF MAPS AT
PAGE(S) 24.
APN: 011-270-300
EXHIBIT B
Legal Description of 383 Susie Property
Real property in the City of South San Francisco, County of San Mateo, State of California,
described as follows:
LOT 8, BLOCK 2, AS DESIGNATED ON THE MAP ENTITLED, “WILLOW GARDENS
SOUTH SAN FRANCISCO, SAN MATEO COUNTY, CALIFORNIA”, FILED IN THE
OFFICE OF THE RECORDER OF THE COUNTY OF SAN MATEO, STATE OF
CALIFORNIA ON DECEMBER 29, 1964 IN BOOK 61 OF MAPS AT PAGES 24 AND 25.
APN: 011-270-170
EXHIBIT C
Schedule of Below Market Rate Units
Income Limits Number of Below Market Rate
Units at 364 Susie Project
Number of Below Market Rate
Units at 383 Susie Project
Very Low Income
0 2
60% AMI
1 0
70% AMI
1 0
90% AMI 1 0
110% AMI 1 0
Total Below Market
Rate Units 4 2
Page 1
Willow Gardens/Greenridge Recast Loan Agreement
AMENDED AND RESTATED LOAN AGREEMENT
CITY OF SOUTH SAN FRANCISCO
WILLOW GARDENS/GREENRIDGE
This Amended and Restated Loan Agreement (the “Agreement”) is made as of
[_________] [__], 2021 (“Effective Date”) by and between the CITY OF SOUTH SAN
FRANCISCO, a municipal corporation (the "Lender" or “City”), and MP WILLOW
GREENRIDGE ASSOCIATES, L.P., a California limited partnership (the “Borrower")
(individually “party” and collectively “parties”).
RECITALS
A. The Borrower intends to acquire, rehabilitate and refinance certain real property
located at 986 Nora Way, 982, 986, and 990 Brusco Way, 344, 364, 383 & 395 Susie Way, and
976 Sandra Court, City of South San Francisco, County of San Mateo, State of California as more
particularly described in Exhibit A attached hereto (the “Willow Gardens Property”), and certain
real property located at 1565 El Camino Real, City of South San Francisco, County of San Mateo,
State of California as more particularly described in Exhibit B attached hereto (the “Greenridge
Property” and collectively with the Willow Gardens Property, the “Property”), for the purpose of
preserving affordable rental housing for households with incomes as further set forth in the City
Regulatory Agreement and HOME Regulatory Agreement (both of which are defined below in
Recital K) recorded concurrently herewith (“Low-Income Households”).
B. Borrower shall substantially rehabilitate and refinance thirty-four (34) apartment
units located on the Greenridge Property and thirty-six (36) apartment units located on the Willow
Gardens Property (the “Project”). Borrower shall ensure that thirty-three (33) of the apartment
units located at the Greenridge Property shall continue to be rented at an affordable rent to and
occupied by Low-Income Households, and one unrestricted unit shall be occupied by the property
manager. Borrower shall further ensure that thirty-five (35) of the apartment units located at the
Willow Gardens Property shall continue to be rented at an affordable rent to and occupied by Low-
Income Households, and one unrestricted unit shall be occupied by the property manager.
C. Lender’s predecessor-in-interest, the Redevelopment Agency of the City of South
San Francisco (the “Agency”), previously made a loan to MP Greenridge Associates, a California
limited partnership (the “Greenridge Seller”) pursuant to that certain Loan Agreement by and
between Greenridge Seller and Agency dated September 30, 1998 (the “Greenridge RDA Loan
Agreement”), in an original principal amount of Nine Hundred and Forty Thousand Dollars
($940,000) derived from Agency’s low and moderate income housing funds pursuant to California
Health and Safety Code section 33334.2 ("Greenridge RDA Loan") evidenced by that certain
Promissory Note dated September 30, 1998 executed by Seller in favor of Agency ("Greenridge
RDA Note"), and secured by that certain Deed of Trust and Assignment of Rents executed by
Seller for the benefit of Agency dated September 30, 1998 and recorded on October 15, 1999 in
the Official Records of San Mateo County (the “Official Records”) as Document No. 98-16858
("Greenridge RDA Deed of Trust"). A regulatory agreement and declaration of restrictive
covenants was recorded in connection with the Greenridge RDA Loan in the Official Records on
October 16, 1998 as Document No. 98168581 (the “Greenridge RDA Regulatory Agreement").
The Greenridge RDA Loan Agreement, Greenridge RDA Note, Greenridge RDA Deed of Trust,
Page 2
Willow Gardens/Greenridge Recast Loan Agreement
and Greenridge RDA Regulatory Agreement shall collectively be referred to herein as the
“Greenridge RDA Loan Documents.”
D. Agency previously made a loan to Willow Gardens Housing Associates, a
California limited partnership (the “Willow Gardens Seller” and collectively with Greenridge
Seller, the “Sellers”) pursuant to that certain Loan Agreement by and between Willow Gardens
Seller and Agency dated January 4, 1999 (the “WG RDA Loan Agreement”), in an original
principal amount of Three Million Five Hundred Thousand Dollars ($3,500,000) derived from
Agency’s low and moderate income housing funds pursuant to California Health and Safety Code
section 33334.2 ("WG RDA Loan") evidenced by that certain Promissory Note dated January 4,
1999 executed by Seller in favor of Agency ("WG RDA Note"), and secured by that certain Deed
of Trust and Assignment of Rents executed by Seller for the benefit of Agency dated January 4,
1999 and recorded on March 16, 1999 in the Official Records as Document No. 99-04015, as
subsequently modified by that certain Modification and Supplement to Deed of Trust and
Assignment of Rents dated January 3, 2001 and recorded on January 11, 2001 in the Official
Records as Document No. 2001-004295, as subsequently modified by that certain Modification of
Deed of Trust and Assignment of Rents dated August 3, 2016 and recorded on November 28, 2016
in the Official Records as Document No. 2016-124182 (collectively the “WG RDA Deed of
Trust"). A regulatory agreement and declaration of restrictive covenants was executed in
connection with the WG RDA Loan on dated January 4, 1999 and recorded in the Official Records
on March 16, 1999 as Document No. 99-045816 and also dated on August 19, 1999 and recorded
in the Official Records on September 1, 1999 as Document No. 1999-150527, as subsequently
amended by that certain Amendment to Regulatory Agreement and Declaration of Restrictive
Covenants dated January 3, 2001 and recorded in the Official Records on January 11, 2001 as
Document No. 2001-004296 as subsequently modified by that certain Modification to Regulatory
Agreement and Declaration of Restrictive Covenants dated August 3, 2016 and recorded in the
Official Records on November 28, 2016 as Document No. 2016-124183 (collectively the “WG
RDA Regulatory Agreement"). The WG RDA Loan Agreement, WG RDA Note, WG RDA Deed
of Trust, and WG RDA Regulatory Agreement shall collectively be referred to herein as the “WG
RDA Loan Documents.”
E. Lender previously made a loan to Willow Gardens Seller pursuant to that certain
HOME Loan Agreement between the Lender and Willow Gardens Seller dated January 4, 1999
("Original HOME Loan Agreement"), in an original principal amount of Six Hundred and
Nineteen Thousand and Fifty Five Dollars ($619,550) of City Home Investment Partnership
Program (the “HOME Program”) funds administered by the City as set forth in 24 CFR Part 92
(the "Original HOME Loan") evidenced by that certain Promissory Note HOME Investment
Partnerships Program dated January 4, 1999 executed by Willow Gardens Seller in favor of Lender
(the "Original HOME Note"), which note is secured by that certain Deed of Trust and Assignment
of Rents executed by Willow Gardens Seller for the benefit of Lender dated January 4, 1999 and
recorded on March 16, 1999 in the Official Records as Document No. 99-045814 (the "Original
HOME Deed of Trust"). A regulatory agreement was executed in connection with the Original
HOME Loan in the Official Records dated January 4, 1999 and recorded in the Official Records
on March 16, 1999 as Document No. 99-045817, as amended by that certain Modification to
HOME Investment Partnerships (“HOME”) Program Regulatory Agreement dated August 3, 2016
recorded in the Official Records on November 28, 2016 as Document No. 2016-124185
(collectively, the "Original HOME Regulatory Agreement"). The Original HOME Loan
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Willow Gardens/Greenridge Recast Loan Agreement
Agreement, Original HOME Note, Original HOME Deed of Trust, and Original HOME
Regulatory Agreement shall collectively be referred to herein as the “Original HOME Loan
Documents.”
F. Lender previously made a loan to Willow Gardens Seller, in an original principal
amount of Five Hundred Thousand Dollars ($500,000) (the "Original City Loan"), evidenced by
that certain Promissory Note dated November 19, 2002 executed by Willow Gardens Seller in
favor of Lender (the "Original City Note"), which note is secured by that certain Deed of Trust
with Assignment of Rents executed by Willow Gardens Seller for the benefit of Lender dated
November 19, 2002 and recorded on November 27, 2002 in the Official Records as Document
No. 2002-249497 (the "Original City Deed of Trust"). A regulatory agreement and declaration of
restrictive covenants was executed in connection with the City Loan in the Official Records dated
October 24, 2013 and recorded in the Official Records on November 28, 2016 as Document No.
2016-124186 (the "Original City Regulatory Agreement"). The Original City Note, Original City
Deed of Trust, and Original City Regulatory Agreement shall collectively be referred to herein as
the “Original City Loan Documents.”
G. Lender previously made a loan to Willow Gardens Seller, in an original principal
amount of Five Hundred Thousand Dollars ($500,000) derived from HOME Program funds
administered by the Lender as set forth in 24 CFR Part 92 (the "Second HOME Loan") evidenced
by that certain Promissory Note HOME Investment Partnerships Program dated August 3, 2016
executed by Willow Gardens Seller in favor of Lender (the "Second HOME Note”), which note is
secured by that certain Deed of Trust, Assignment of Rents, Security Agreement and Fixture Filing
executed by Willow Gardens Seller for the benefit of Lender dated August 3, 2016 and recorded
on November 28, 2016 in the Official Records as Document No. 2016-124187 (the "Second
HOME Deed of Trust"). The Second HOME Note and Second HOME Deed of Trust shall
collectively be referred to herein as the “Second HOME Loan Documents.”
H. The Greenridge RDA Loan Documents, WG RDA Loan Documents, Original
HOME Loan Documents, Original City Loan Documents, and Second HOME Loan Documents
shall collectively be referred to herein as the “Original Loan Documents.”
I. Concurrently with the execution of this Agreement, Sellers and the Borrower have
executed assignment and assumption agreements pursuant to which Sellers assigned, and the
Borrower assumed the obligations pursuant to the Original Loan Documents, with the consent of
the Lender (collectively, the “Assignment Agreement”).
J. Borrower has requested and Lender has agreed to recast the Greenridge RDA Loan,
WG RDA Loan, Original HOME Loan, Original City Loan, and Second HOME Loan (collectively
“Original Loans”) into a single loan (the “City Loan”), in the aggregate principal amount of
$[8,485,680], subject to the terms and conditions of this Agreement, evidenced by a promissory
note executed by Borrower in favor of City (the “City Note”) and which note shall be secured by
a Deed of Trust and Assignment of Rents executed by Borrower for the benefit of City (the “City
Deed of Trust”). The Greenridge RDA Deed of Trust, WG Deed of Trust, Original HOME Deed
of Trust, Original City Deed of Trust, and Second HOME Deed of Trust, shall each be reconveyed
by the Lender and collectively replaced by the City Deed of Trust.
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Willow Gardens/Greenridge Recast Loan Agreement
K. Concurrently herewith, as a condition of the Loan, the Borrower will execute a new
regulatory agreement (the “City Regulatory Agreement”) which will regulate the Project for the
term of the City Loan to ensure that the units remain occupied by and affordable to Low-Income
Households and execute a new HOME regulatory agreement (the “HOME Regulatory
Agreement”) which will regulate the HOME-assisted units in the Project for the term of the City
Loan to ensure that such units remain occupied by and affordable to Lower-Income Households.
The Lender will, simultaneously with the execution of the City Regulatory Agreement and HOME
Regulatory Agreement (collectively “Regulatory Agreements”), terminate the Greenridge RDA
Regulatory Agreement, WG RDA Regulatory Agreement, Original HOME Regulatory
Agreement, and the Original City Regulatory Agreement.
NOW THEREFORE, in consideration of the mutual agreements, obligations, and
representations, and in further consideration for the making of the City Loan, the Borrower and
Lender hereby agree as follows:
ARTICLE 1
LOAN TERMS
1.1. Loan Agreement. The Lender agrees to recast the Original Loans into the City
Loan in the aggregate principal amount of $[8,485,680], and Borrower agrees to borrow an
amount not to exceed [Eight Million Four Hundred Eighty-Five Thousand Six Hundred and
Eighty Dollars ($8,485,680)] subject to the conditions and terms of and for the purposes set forth
this Agreement (“Loan Proceeds”). The City Loan is comprised of the Original Loans. The City
Loan shall be evidenced by the City Note substantially in the form agreed to by the City, which
shall be secured by the City Deed of Trust recorded against the Property in substantially the form
approved by the City. In addition, Borrower shall execute and record the Regulatory Agreements
in substantially the forms approved by the City. This Agreement, the City Note, the City Deed
of Trust and the Regulatory Agreements shall be collectively referred to as the “City Loan
Documents”. This Agreement amends and restates the Original Loans in their entirety, and as
such, the Original Loans are hereby terminated and of no further force and effect. Upon
Borrower’s execution and recordation of the City Note, City Deed of Trust and Regulatory
Agreements concurrently herewith, the Lender shall: (i) mark cancelled each of the Greenridge
RDA Note, WG RDA Note, Original HOME Note, Original City Note, and Second HOME Note;
(ii) reconvey the Greenridge RDA Deed of Trust, WG Deed of Trust, Original HOME Deed of
Trust, Original City Deed of Trust, and Second HOME Deed of Trust; and (iii) terminate the
Greenridge RDA Regulatory Agreement, WG RDA Regulatory Agreement, Original HOME
Regulatory Agreement, and the Original City Regulatory Agreement. Provided that Borrower has
complied with all conditions set forth in Section 1.4, the Loan Proceeds shall be disbursed in
accordance with Section 1.3 hereof.
1.2. Use of Loan Proceeds. The Loan Proceeds shall be used solely and exclusively for
the costs of the Project.
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Willow Gardens/Greenridge Recast Loan Agreement
1.3. Disbursement of Proceeds. Upon satisfaction of the conditions set forth in Section 1.4,
and provided that Borrower has delivered such other documentation as the Lender may reasonably
require, Lender shall promptly disburse Loan Proceeds to Borrower.
1.4. Conditions Precedent to Disbursement of Loan Proceeds. Lender’s obligation to disburse
Loan Proceeds is conditioned upon satisfaction of all of the following conditions:
(a) There exists no Default nor any act, failure, omission or condition that
would constitute a default under this Agreement;
(b) The Borrower holds title to the Property or is acquiring title simultaneously
with the disbursement of the Loan Proceeds;
(c) A title insurer reasonable acceptable to the Lender is unconditionally and
irrevocably committed to issuing an ALTA Lender's Policy of title insurance insuring the
priority of the City Deed of Trust in the amount of the Loan, subject only to such exceptions
and exclusions as may be reasonably acceptable to the Lender, and containing such
endorsements as the Lender may reasonably require.
(d) Escrow instructions ("Escrow Instructions") prepared by the parties shall be
delivered to and accepted by the title company. The Escrow Instructions shall be consistent
with the terms of this Agreement and shall provide, among other matters, that prior to the
Closing Date (as defined below):
(1) This Agreement shall be executed by the Borrower and the Lender
and delivered to the Lender;
(2) The City Note shall be executed by Borrower and delivered to the
Lender;
(3) The City Deed of Trust shall be executed by Borrower and
submitted for recording in the records of the County of San Mateo
(the "County");
(4) The Regulatory Agreements shall have been executed by Borrower
and the Lender and submitted for recording in the records of the
County;
(e) Any approval of this Agreement, the City Note, the City Deed of Trust, or
the Regulatory Agreements contemplated by this Agreement that is required under the City
Loan Documents shall be delivered to the Lender, and any certification required by the
Lender with respect to the procurement of any such approval shall be delivered by
Borrower to the Lender.
(f) Borrower shall provide the Lender with a resolution approving and
authorizing execution of this Agreement and all documents contemplated hereby and with
such other documentation required by the Lender regarding Borrower's status and authority
to enter into this transaction.
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Willow Gardens/Greenridge Recast Loan Agreement
(g) Borrower shall provide the Lender with certificates of insurance, in form
and with insurers admitted in California and acceptable to the Lender, evidencing
compliance with the insurance requirements, as provided by the Lender on or prior to the
Closing Date, and upon demand by Lender at any time subsequent. If requested by the
Lender, Borrower shall also provide complete copies of the required insurance policies and
bonds.
(h) The closing contemplated by this Section 1.4 and the Escrow Instructions
shall occur within thirty (30) days of the date of execution of this Agreement, unless the
parties agree to a different closing date (the "Closing Date").
1.5. Maturity Date. Provided that Borrower is not in default under the terms of this
Agreement, the outstanding principal balance of the City Loan and any other sums due under the
City Note shall be payable in full on the date that is fifty-five (55) years from the date of
completion of the Project’s rehabilitation scope of work, as evidenced by a temporary certificate
of occupancy or equivalent unless extended by the mutual consent of the parties, but in any event
no later than December 31, 2078 (“Maturity Date”).
1.6. Regulatory Agreement. In connection herewith, the Borrower shall execute and record
the Regulatory Agreements in substantially the forms approved by the City, which shall regulate
all units of the Property to ensure that the units remain occupied by and rented at an affordable
rent to Low-Income Households for fifty-five (55) years from the Regulatory Agreement
Effective Dates.
1.7. No Obligation to Disburse Proceeds Upon Default or Termination. Notwithstanding
any other provision of this Agreement, Lender shall have no obligation to disburse any portion of
the Loan Proceeds to Borrower:
(a) Upon the failure of any of Borrower’s representations and warranties set
forth in this Agreement to be true and correct in all material respects;
(b) Following the termination of this Agreement; or
(c) During the pendency of any uncured Event of Default.
1.8. Security.
1.8.1. Assignment. As security for the Loan, and as part of the consideration for entering
into this Agreement, Borrower hereby assigns its rights under the Collateral, as
defined below (the "Assignment"). The Assignment shall become effective upon the
occurrence of an Event of Default. Lender shall have no obligation under the
Collateral unless it expressly agrees in writing to be bound thereby. If the Assignment
shall become effective, Lender may use the Collateral for any purposes for which
Borrower could have made use of the same in the development of the Project.
Borrower shall cooperate with Lender in the implementation of its rights under the
Assignment, and shall immediately deposit the Collateral with Lender if the
Assignment becomes effective. As used herein, the term "Collateral" includes the
following: All architectural designs, construction, engineering, surveying, and
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Willow Gardens/Greenridge Recast Loan Agreement
consulting contracts, and any and all amendments, modifications, supplements,
addenda and general conditions thereto heretofore or hereafter entered into by
Borrower and any contractor or consultant pertaining to development of the Project;
all plans and specifications, surveys, shop drawings, working drawings, reports,
studies, amendments, modifications, changes, supplements, general conditions,
addenda and work product thereto heretofore or hereafter prepared by Borrower or
any contractor or consultant pertaining to development of the Project; all land use
approvals, conditional use permits, building permits and other governmental
entitlements and approvals of any nature obtained for the Project; and all financing
applications or other applications and all other tangible documents, except those of a
proprietary or confidential nature, pertaining to development of the Project.
1.8.2. Deed of Trust. In addition to the Assignment, concurrent with the Borrower's
acquisition of the Property, the Borrower shall record and comply with the Deed of
Trust.
1.9. Subordination. Lender agrees it will not withhold consent to reasonable requests for
subordination of this Agreement, City Deed of Trust and City Regulatory Agreement to deeds of
trust provided for the benefit of lenders providing financing for the acquisition, development or
rehabilitation of the Project (and their successors and assigns) (“Senior Lender”), securing other
unrelated party Project loans, if any (each, a "Senior Loan"), subject to the following conditions:
(a) Borrower must demonstrate to the Lender's reasonable satisfaction that
subordination of the City Deed of Trust and/or City Regulatory Agreement is necessary to
secure adequate financing for the Project, including the continued operation of the Property
as affordable rental housing, as required by the City Loan Documents. To satisfy this
requirement, Borrower must provide to the Lender, in addition to any other information
reasonably required by the Lender, evidence demonstrating that the proposed amount of
the Senior Loan is necessary to provide adequate financing to ensure the viability of the
Project, and adequate financing for the Project would not be available without the proposed
subordination or that such loans are existing loans that would not approve the Loan without
subordination.
(b) Provided that Borrower agrees to use its best efforts to ensure that the
instruments effecting such subordination for the benefit Senior Lender shall contain each
of the following provisions: (i) Senior Lender shall use its best efforts to provide to Lender
a copy of any notice of default issued to Borrower concurrently with provision of such
notice to Borrower; and, (ii) Lender shall have the reasonable right, but not the obligation,
to cure any default by Borrower within the same period of time provided to Borrower for
such cure extended by an additional 90 days. Borrower agrees to provide to Lender a copy
of any notice of default Borrower receives from any Senior Lender within thirty (30)
business days following Lender’s receipt thereof.
(c) The subordination(s) described in this section may be effective only during
the original term of the Senior Loan and any extension of its term.
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Willow Gardens/Greenridge Recast Loan Agreement
(d) No subordination may limit the effect of the City Deed of Trust and/or City
Regulatory Agreement before a foreclosure. Borrower shall reimburse Lender for all
Lender costs, including but not limited to reasonable attorneys’ fees, incurred in reviewing
instruments and other legal documents proposed to effect a subordination under this
Agreement within ten (10) days following Lender’s delivery of an invoice detailing such
costs to Borrower.
ARTICLE 2
GENERAL REQUIREMENTS
2. Non-Discrimination.
Borrower shall not restrict the rental, sale, lease, sublease, transfer, use, occupancy,
tenure or enjoyment of the Property or Project, or any portion thereof, on the basis of race, color,
religion, sex, gender, gender identity, gender expression, sexual orientation, marital status,
national origin, ancestry, familial status, source of income, disability, or genetic information of
any person. Borrower covenants for itself and all persons claiming under or through it, and this
Agreement is made and accepted upon and subject to the condition that there shall be no
discrimination against or segregation of any person or group of persons on account of any basis
listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are
defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of
Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease,
transfer, use, occupancy, tenure or enjoyment of the Property, Project or part thereof, nor shall
Borrower or any person claiming under or through Borrower establish or permit any such
practice or practices of discrimination or segregation with reference to the selection, location,
number, use or occupancy of tenants, lessees, subtenants, sub lessees or vendees in, of, or for the
Property, Project or part thereof.
All deeds made or entered into by Borrower, its successors or assigns, as to any portion
of the Property or Project shall contain the following language, and all leases or contracts made
or entered into by Borrower, its successors or assigns, as to any portion of the Property or
Project, shall reference this Section, and shall enforce the same diligently and in good faith:
“(a) Borrower herein covenants by and for itself, its successors and assigns, and
all persons claiming under or through it, that there shall be no discrimination
against or segregation of a person or of a group of persons on account of any basis
listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those
bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1)
of subdivision (p) of Section 12955, and Section 12955.2 of the Government
Code, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of
the property herein conveyed nor shall the Borrower or any person claiming under
or through the Borrower establish or permit any such practice or practices of
discrimination or segregation with reference to the selection, location, number,
use or occupancy of tenants, lessees, subtenants, sub lessees or vendees in the
property herein conveyed. The foregoing covenant shall run with the land.
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Willow Gardens/Greenridge Recast Loan Agreement
“(b) Notwithstanding paragraph (a), with respect to familial status, paragraph (a)
shall not be construed to apply to housing for older persons, as defined in Section
12955.9 of the Government Code. With respect to familial status, nothing in
paragraph (1) shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, and
799.5 of the Civil Code, relating to housing for senior citizens. Subdivision (d) of
Section 51 of the Civil Code and subdivisions (d) of Section 12955 of the
Government Code shall apply to paragraph (a).”
Nothing herein shall be construed or interpreted as prohibiting or preventing local
preferences or special needs set-asides for the Project’s units as established in
loan agreements, regulatory agreements, etc., so long as such preferences or set
asides comply with applicable local, state, and federal fair housing laws.
2.1 Compliance with Laws.
Borrower shall carry out the construction, development and operation or the Project in
conformity with all governmental requirements, including without limitation all applicable state
labor standards, City zoning and development standards, building, plumbing, mechanical and
electrical codes, and all other provisions of the City’s Municipal Code, and all applicable
disabled and handicapped access requirements, including without limitation the Americans With
Disabilities Act, 42 U S.C. Section 12101, et seq., Government Code Section 4450, et seq.,
Government Code Section 11 135, et seq., and the Unruh Civil Rights Act, Civil Code Section
51, et seq. and this Agreement shall not be construed as granting any such City approvals.
2.1.1. Compliance with Prevailing Wage Laws.
Borrower shall carry out the construction through completion of the
Project and the overall development of the Property in conformity with all applicable
governmental requirements relating to the payment of prevailing wages and compliance
with prevailing wage rules, including, without limitation, if applicable, the requirements
to pay prevailing wages under federal law (the Davis-Bacon Act, 40 U.S.C. Section
3141, et seq., and the regulations promulgated thereunder set forth at 29 CFR Part l
(collectively, “Davis-Bacon”) and California law (Labor Code Section 1720, et seq.)
(“California Prevailing Wage Law”). The parties acknowledge that a financing
structure utilizing certain federal and/or state funding sources and financing scenarios
may require compliance with applicable state and federal prevailing wage laws and
regulations. Borrower shall determine the applicability of federal, state, and local
prevailing wage laws based upon the final financing structure and sources of funding of
the Project.
Borrower shall be solely responsible, expressly or impliedly and legally
and financially, for determining and effectuating compliance with all applicable federal,
state, and local public works requirements, prevailing wage laws, and labor laws and
standards, and City makes no representation, either legally and/or financially, as to the
applicability or non-applicability of any federal, state, and local laws to the construction
of the Project. Borrower expressly, knowingly, and voluntarily acknowledges and agrees
that City has previously represented to Borrower or to any representative, agent, or
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Willow Gardens/Greenridge Recast Loan Agreement
affiliate of Borrower, or any contractor(s) or any subcontractor(s) for the demolition
work, construction, or development of the Project, in writing or otherwise, in a call for
bids or otherwise, that the work and construction of the Project is (or is not) a “public
work,” as defined in Section 1720 of the Labor Code or under Davis-Bacon.
Borrower knowingly and voluntarily agrees that Borrower shall have the
obligation to provide any and all disclosures or identifications as required by Labor Code
Section 1781 and/or by Davis-Bacon, as the same may be amended from time to time, or
any other similar law or regulation. Borrower shall indemnify, protect, pay for, defend,
and hold harmless the Indemnitees as defined in Section 2.4, with legal counsel
reasonably acceptable to City, from and against any and all loss, liability, damage, claim,
cost, expense, and/or “increased costs” (including reasonable attorney’s fees, court and
litigation costs, and fees of expert witnesses) which, in connection with the development,
construction (as defined by applicable law) and/or operation of the Project, including,
without limitation, any and all public works (as defined by applicable law), results or
arises in any way from any of the following: (i) the noncompliance by Borrower or its
contractor with any applicable local, state, and/or federal law or regulation, including,
without limitation, any applicable federal and/or state labor laws or regulations
(including, without limitation, if applicable, the requirement to pay state and/or federal
prevailing wages and hire apprentices): (ii) implementation of Section 1781 of the Labor
Code and/or of Davis-Bacon, as the same may be amended from time to time, or any
other similar law or regulation; and/or (iii) failure by Borrower to provide any required
disclosure or identification as required by Labor Code Section 1781 and/or by Davis-
Bacon, as the same may be amended from time to time, or any other similar law or
regulation. It is agreed by the Parties that, in connection with the demolition work,
development, and construction (as defined by applicable law or regulation) of the Project,
including, without limitation, any and all public works (as defined by applicable law or
regulation), Borrower shall bear all risks of payment or non-payment of prevailing wages
under applicable federal, state, and local law or regulation and/or the implementation of
Labor Code Section 1781 and/or by Davis-Bacon, as the same may be amended from
time to time, and/or any other similar law or regulation. The foregoing indemnity shall
survive termination of this Agreement and shall continue after completion of the
construction and development of the Project by Borrower.
“Increased costs,” as used in this Section, shall have the meaning ascribed
to it in Labor Code Section 1781, as the same may be amended from time to time.
Borrower acknowledges and agrees that City’s Request for Qualifications
and Request for Proposals for selection of an Borrower to develop the Project, if any,
required that all proposals submitted include the payment of prevailing wages, and that
Borrower’s proposal included the payment of prevailing wages. In furtherance of the
foregoing, and notwithstanding anything in this Section to the contrary, Borrower shall
pay prevailing wages in accordance with California Prevailing Wage Laws for all
construction work performed on behalf of the Project, as set forth in Borrower’s proposal.
Should Borrower fail to comply with this Section 2, it shall constitute an Event of Default
hereunder entitling Lender to exercise any of its remedies set forth herein.
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Willow Gardens/Greenridge Recast Loan Agreement
2.2. Additional Borrower Covenants, Representations and Warranties. Borrower
represents and warrants to Lender as follows:
a. Organization of the Borrower. Borrower is a duly organized nonprofit public
benefit corporation, validly existing and in good standing under the laws of the
State of California. Borrower has all requisite power and authority to develop the
Project, to carry on its business as now conducted, and to execute, deliver and
perform its obligations under this Agreement, the City Note, City Deed of Trust
and the Assignment Agreement. Borrower has received a determination from the
Internal Revenue Service that it is exempt from federal tax under Section
501(c)(3) of the Internal Revenue Code of 1986 as amended.
b. Authorization of the Loan; No Violation. The execution, delivery and
performance of this Agreement, the City Deed of Trust and the City Note have
been duly authorized by Borrower, and this Agreement, the City Deed of Trust
and the City Note, when duly executed and delivered will constitute the valid and
binding obligations of Borrower enforceable in accordance with their respective
terms. Borrower’s execution of this Agreement, the City Deed of Trust and the
City Note and performance thereunder will not result in a breach of or constitute
a default under any agreement, indenture or other instrument to which Borrower
is a party or by which Borrower may be bound.
c. Litigation. There are no pending or, to Borrower’s knowledge, threatened
actions or proceedings before any court or administrative agency which may
adversely affect the financial condition or operation of Borrower or its ability to
carry out the obligations of Borrower under this Agreement, the City Deed of
Trust and the City Note. Borrower is not the subject of an action under federal or
state Bankruptcy Law (as defined below).
2.3 Hazard and Liability Insurance. The Borrower shall at all times cause the Property
to be insured against loss by fire, flood, if in a flood zone, and such other hazards, casualties,
liabilities and contingencies, and in such amounts and for such periods as are reasonably acceptable
to the Lender. All insurance policies and renewals thereof shall be issued by a carrier and in a form
acceptable to the Lender and there shall be a specific contractual liability endorsement extending
Borrower’s coverage to include the contractual liability assumed by Borrower pursuant to this
Agreement. These certificates shall specify or be endorsed to provide that thirty (30) days’ notice
must be given, in writing, to City of any cancellation of the policy for reasons other than non-
payment of premium, and ten (10) days’ notice of cancellation of the policy for non-payment of
premium.
Property insurance policies shall name the Lender as an additional insured, as approved
by the Lender. Throughout the term of this Agreement, Borrower shall comply with the insurance
requirements set forth in this Agreement and the City Loan Documents, and shall, at Borrower’s
expense, maintain in full force and effect insurance coverage as specified therein.
The foregoing shall not limit the obligations of Borrower pursuant to the City Deed of
Trust.
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Willow Gardens/Greenridge Recast Loan Agreement
2.4 Indemnification. Borrower shall indemnify, defend (with counsel approved by the
City), and hold the City and its elected and appointed officers, officials, employees, contractors,
agents, and representatives (all of the foregoing, collectively the “Indemnitees”) harmless from
and against any and all liabilities, losses, damages, fines, deficiencies, penalties, claims, demands,
suits, actions, causes of action, legal or administrative proceedings, judgments, costs and expenses
(including without limitation reasonable attorneys’ fees and court costs) (all of the foregoing,
collectively “Claims”) arising directly or indirectly in any manner in connection with or resulting
from, (a) any failure of any of Borrower’s representations or warranties set forth in this Agreement,
or made by Borrower in connection with the execution and delivery of this Agreement or in any
certificate furnished pursuant hereto, or in connection with any request for disbursement of Loan
proceeds to be correct in all material respects; (b) any contract for services entered into between
Borrower and a third party, or services provided to Borrower by a third party, related to the Project;
and (c) any claim, demand or cause of action, or any action or other proceeding, whether
meritorious or not, brought or asserted against any Indemnitee which relates to or arises in
connection with the Loan or any transaction contemplated thereby. Borrower’s obligations under
this Section shall survive the making and repayment of the Loan and the expiration or termination
of this Agreement. Borrower's indemnity obligations shall not apply to Claims arising solely as a
result of the willful misconduct or gross negligence of the Indemnitees.
2.5 Lender Review and Inspections.
(a) Upon not less than 3 business days’ notice to the Borrower, the Lender may
at any time during the term of this Agreement, enter and inspect the physical
premises and inspect all accounting records pertaining to the development
or operation of the Project. Upon request by the Lender, the Borrower shall
notify occupants of upcoming inspections of their units in accordance with
state law.
(b) The Lender may request any other reasonable information that it deems
necessary to monitor compliance with requirements set forth in this
Agreement. Such information shall be promptly provided by the Borrower.
(c) Borrower shall preserve and make available its records related to receipt
and use of Loan Proceeds until the expiration of five years from the date of
the final disbursement of Loan proceeds, or for such longer period, if any,
as is required by law. Borrower shall preserve and make available its
records related to occupancy and rent requirements until the expiration of
five years from the end of the calendar year to which such records pertain,
or for such longer period, if any, as is required by law. If this Agreement is
completely or partially terminated, the records relating to the work
terminated shall be preserved and made available for a period of five years
from the date of any resulting final settlement.
2.6 Restrictions on Sale, Encumbrance, and Other Acts.
(a) The Borrower shall not make any sale, encumbrance, hypothecation,
assignment, pledge, conveyance, or transfer in any form of the Project or of
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Willow Gardens/Greenridge Recast Loan Agreement
any its interest therein, except with the prior written approval of the Lender.
Notwithstanding the previous sentence, the following transfers are hereby
approved by the City: (a) the transfer of the Project to a limited partnership,
the general partner of which is an affiliate of Borrower; (b) the transfer or
pledge of limited partnership interests in the Borrower; (c) the removal and
replacement of the general partner for cause in accordance with the terms
of the limited partnership agreement of Borrower; d) the grant and exercise
of an option or right of first refusal in favor of Borrower’s general partner
or an affiliate thereof and (e) a deed of trust encumbering the Property
granted in connection with any other loan provided for the Project
(including but not limited to the construction loan provided by Capital One,
National Association and the permanent financing loan provided by First
Republic Bank).
(b) In the event of a transfer of the Project to a wholly-controlled affiliate of
MidPen Housing Corporation (“MidPen”), Lender approval rights shall be
limited to changes requested by Borrower to the terms of the Loan and
transferee’s willingness to assume all obligations of Borrower pursuant to
the City Loan Documents.
(c) Subject to the rights of senior lenders, the unpaid principal balance of the
Loan together with any unpaid interest due thereon shall be due and payable
in full upon: 1) a refinancing, sale, transfer or other disposition of the
Property or any portion thereof, unless such disposition of the Property has
been first approved in writing by the Lender, or such approval is not
required pursuant to this Agreement; or 2) the declaration by the Lender of
a default as described and subject to the cure periods in Article 3 below.
(d) The Borrower shall not permit the use of the Property for any purpose other
than that permitted by this Agreement without the prior written approval of
the Lender.
(e) The Lender may approve a sale, transfer or conveyance provided that all of
the following conditions are met:
(1) the Borrower is in compliance with the Regulatory Agreements or
the sale, transfer or conveyance will result in the cure of any existing
violations of the Regulatory Agreements;
(2) the transferee agrees to assume all obligations of the Borrower
pursuant to the Regulatory Agreements; and
(3) any transferee demonstrates to the Lender’s satisfaction that it has
the management and financial capacity to own and operate the
Property.
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Willow Gardens/Greenridge Recast Loan Agreement
2.7 Assignment of Lender Rights. The Lender retains the right at its sole discretion to
assign all or part of its rights under this Agreement for the purpose of ensuring compliance and
enforcement of the Borrower’s duties and obligations hereunder. In addition, the Lender may
designate an agent to act on its behalf in monitoring compliance and enforcing the provisions
hereof.
2.8 Environmentally Impaired. In the event that any portion of the Property is
determined to be “environmentally impaired” (as that term is defined in California Code of Civil
Procedure Section 726.5(e)(3)) or to be an “affected parcel” (as that term is defined in California
Code of Civil Procedure Section 726.5(e)(1)), then, without otherwise limiting or in any way
affecting the Lender's or the trustee's rights and remedies under the City Deed of Trust, the Lender
may elect to exercise its rights under California Code of Civil Procedure Section 726.5(a) to (1)
waive its lien on such environmentally impaired or affected portion of the Property and (2) exercise
(a) the rights and remedies of an unsecured creditor, including reduction of its claim against the
Borrower to judgment, and (b) any other rights and remedies permitted by law. For purposes of
determining the Lender's right to proceed as an unsecured creditor under California Code of Civil
Procedure Section 726.5(a), the Borrower shall be deemed to have willfully permitted or
acquiesced in a release or threatened release of hazardous materials, within the meaning of
California Code of Civil Procedure Section 726.5(d)(1), if the release or threatened release of
hazardous materials was knowingly or negligently caused or contributed to by any lessee,
occupant, or user of any portion of the Property and the Borrower knew or should have known of
the activity by such lessee, occupant, or user which caused or contributed to the release or
threatened release. All costs and expenses, including (but not limited to) reasonable attorneys'
fees, incurred by the Lender in connection with any action commenced under this paragraph,
including any action required by California Code of Civil Procedure Section 726.5(b) to determine
the degree to which the Property is environmentally impaired, plus interest thereon at the lesser of
ten percent (10%) or the maximum rate permitted by law, until paid, shall be added to the
indebtedness evidenced by the City Note and secured by the City Deed of Trust and shall be due
and payable to the Lender upon its demand made at any time following the conclusion of such
action.
ARTICLE 3
DEFAULTS AND REMEDIES
3.1 Event of Default.
Each of the following shall constitute a “Default” and “Event of Default” by Borrower
under this Agreement:
(a) Failure to Complete Scope of Work. Failure of Borrower to complete the
Project by the date provided in Exhibit C “Scope of Work,” as such date may be extended with
Lender’s approval.
(b) Failure to Make Payment. Failure to repay the principal and any interest on
the Loan within ten (10) days of receipt of written notice from the Lender that such payment is
due pursuant to the City Loan Documents.
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Willow Gardens/Greenridge Recast Loan Agreement
(c) Breach of Covenants. Failure by Borrower to duly perform, comply with,
or observe any of the conditions, terms, or covenants of any of the City Loan Documents, and such
failure having continued uncured for thirty (30) days after receipt of written notice thereof from
the Lender to the Borrower or, if the breach cannot be cured within thirty (30) days, the Borrower
shall not be in breach so long as Borrower is diligently undertaking to cure such breach and such
breach is cured within a reasonable period thereafter; provided, however, that if a different period
or notice requirement is specified under any other section of this Article 3, the specific provisions
shall control.
i. Upon the occurrence of an event of default, Lender shall provide to
Borrower and Borrower’s limited partner written notice of said occurrence,
and Borrower and its limited partner shall have thirty (30) days to cure. If
the default cannot reasonably be cured in thirty (30) days, Borrower and
Borrower’s sole member/manager shall have an additional sixty (60) days
to cure, provided the cure has commenced within thirty (30) days and is
diligently pursued to completion. If, after the time provided in this
subparagraph (b), Borrower or its limited partner has not cured the default,
or Lender has not waived its rights under the City Note, the entire unpaid
balance, together with all other sums then payable under the City Note,
shall, at the option of Lender, become immediately due and payable upon
written notice by Lender to Borrower without further demand. Notice to
Borrower and Borrower’s limited partner shall be at the addresses specified
in the City Deed of Trust, or as otherwise provided to Lender in writing
from time to time. Notwithstanding anything to the contrary contained
herein, or in any of the City Loan Documents, the limited partner of
Borrower shall have the right, but not the obligation, to cure the defaults of
the Borrower.
(d) Default Under Other Loans. Failure to make any payment or perform any
of Borrower's covenants, agreements, or obligations under the documents evidencing and securing
other Project loans, following expiration of all applicable notice and cure periods.
(e) Insolvency. A court having jurisdiction shall have made or entered any
decree or order (i) adjudging Borrower to be bankrupt or insolvent, (ii) approving as properly filed
a petition seeking reorganization of Borrower or seeking any arrangement for Borrower under the
bankruptcy law or any other applicable debtor's relief law or statute of the United States or any
state or other jurisdiction, (iii) appointing a receiver, trustee, liquidator, or assignee of Borrower
in bankruptcy or insolvency or for any of their properties, (iv) directing the winding up or
liquidation of Borrower, if any such decree or order described in clauses (i) to (iv), inclusive, shall
have continued unstayed or undischarged for a period of ninety (90) days; or (v) Borrower shall
have admitted in writing its inability to pay its debts as they fall due or shall have voluntarily
submitted to or filed a petition seeking any decree or order of the nature described in clauses (i) to
(iv), inclusive. The occurrence of any of the events of Default in this paragraph shall act to
accelerate automatically, without the need for any action by the Lender, the indebtedness
evidenced by the Note.
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Willow Gardens/Greenridge Recast Loan Agreement
(f) Assignment; Attachment. Borrower shall have assigned its assets for the
benefit of its creditors or suffered a sequestration or attachment of or execution on any substantial
part of its property, unless the property so assigned, sequestered, attached or executed upon shall
have been returned or released within ninety (90) days after such event or, if sooner, prior to sale
pursuant to such sequestration, attachment, or execution. The occurrence of any of the events of
default in this paragraph shall act to accelerate automatically, without the need for any action by
Lender, the indebtedness evidenced by the City Note.
(g) Suspension; Termination. Borrower shall have voluntarily suspended its
business.
(h) Condemnation. The condemnation, seizure, or appropriation of all or the
substantial part of the Property.
(i) Unauthorized Transfer. Any transfer other than as permitted by Section 2.6.
(j) Representation or Warranty Incorrect. Any Borrower representation or
warranty contained in this Agreement, in connection with the execution and delivery of this
Agreement , or in any application, financial statement, certificate, or report submitted to the Lender
in connection with any of the City Loan Documents or in connection with any request for
disbursement of Loan Proceeds, proving to have been incorrect in any material respect when made.
(k) Failure to Use Loan Proceeds in Accordance with Agreement. Borrower
fails to use Loan Proceeds in accordance with this Agreement or fails to use Loan Proceeds in
accordance with Borrower's request for disbursement.
(l) Failure to Maintain Insurance. Borrower fails to maintain insurance as
required pursuant to any of the City Loan obligations, and Borrower fails to cure such default
within ten (10) days.
3.2 Remedies.
The occurrence of any Default hereunder following the expiration of all applicable notice
and cure periods will, either at the option of the Lender or automatically where so specified, relieve
the Lender of any obligation to make or continue the Loan and shall give the Lender the right to
terminate this agreement and/or proceed with any and all remedies set forth in this Agreement and
the City Loan Documents, including but not limited to the following:
(a) Acceleration of Note. Subject to the rights of Senior Lenders, the Lender
shall have the right to cause all indebtedness of the Borrower to the Lender under this Agreement
and the City Note, together with any accrued interest thereon, to become immediately due and
payable. The Borrower waives all right to presentment, demand, protest or notice of protest or
dishonor. The Lender may proceed to enforce payment of the indebtedness and to exercise any or
all rights afforded to the Lender as a creditor and secured party under the law including the
Uniform Commercial Code, including foreclosure under the City Deed of Trust. The Borrower
shall be liable to pay the Lender on demand all reasonable expenses, costs and fees (including,
without limitation, reasonable attorney's fees and expenses) paid or incurred by the Lender in
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Willow Gardens/Greenridge Recast Loan Agreement
connection with the collection of the Loan and the preservation, maintenance, protection, sale, or
other disposition of the security given for the Loan.
(b) Exercise of Remedies Under Deed of Trust. Subject to the rights of Senior
Lenders, Lender shall have the right to exercise the remedies under the City Deed of Trust and the
Assignment of Collateral pursuant to and as described in Section 1.8.
(c) Specific Performance. The Lender shall have the right to mandamus or
other suit, action or proceeding at law or in equity to require Borrower to perform its obligations
and covenants under the City Loan Documents or to enjoin acts on things which may be unlawful
or in violation of the provisions of the City Loan Documents.
(c) Right to Cure at Borrower's Expense. The Lender shall have the right (but
not the obligation) to cure any monetary default by Borrower under a loan other than the Loan.
The Borrower agrees to reimburse the Lender for any funds advanced by the Lender to cure a
monetary default by Borrower upon demand therefor, together with interest thereon at the lesser
of the maximum rate permitted by law or ten percent (10%) per annum from the date of expenditure
until the date of reimbursement and such costs shall constitute an indebtedness secured by the City
Note.
(d) Limited Partner’s Cure Rights. In the event the City Loan Documents are
assigned to a limited partnership affiliate of Borrower in accordance with this Agreement, all
references to sole member/manager shall be deemed to refer to the general partner of such limited
partnership, and any notice given to the limited partnership and general partner shall be given to
the limited partner at the address provided by such limited partner in writing. The limited partner
shall have the right to cure the default within the time periods set forth above or in the applicable
Agreement, and any cure tendered by the limited partner shall be accepted or rejected on the same
basis as if such cure had been tendered by Borrower.
3.3 Right of Contest. Borrower shall have the right to contest in good faith any claim,
demand, levy, or assessment the assertion of which would constitute a Default hereunder. Any
such contest shall be prosecuted diligently and in a manner unprejudicial to the Lender or the rights
of the Lender hereunder.
3.4 Remedies Cumulative. No right, power, or remedy given to the Lender by the terms
of this Agreement or the City Loan Documents is intended to be exclusive of any other right,
power, or remedy; and each and every such right, power, or remedy shall be cumulative and in
addition to every other right, power, or remedy given to the Lender by the terms of any such
instrument, or by any statute or otherwise against Borrower and any other person. Neither the
failure nor any delay on the part of the Lender to exercise any such rights and remedies shall
operate as a waiver thereof, nor shall any single or partial exercise by the Lender of any such right
or remedy preclude any other or further exercise of such right or remedy, or any other right or
remedy. Any material breach by the Borrower of any representation, warranty or covenant
hereunder, which is not cured within thirty days (30) after notice thereof given by the Lender or,
where cure is not possible within thirty (30) days, whose cure is not commenced within thirty days
and diligently prosecuted to completion shall constitute an Event of Default.
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Willow Gardens/Greenridge Recast Loan Agreement
3.5 Lender's Remedies. Upon the happening of an Event of Default, subject to the
rights of Senior Lenders, the Lender may pursue any remedy allowed at law or in equity, including
but not limited to, accelerating payment under the Note or applying to any State court for specific
performance of this Agreement and the Regulatory Agreement.
ARTICLE 4
MISCELLANEOUS PROVISIONS
4.1 Conflict of Interest. No employee, agent, consultant, officer, elected or appointed
official or member of the Lender has or may obtain a personal or financial interest in or benefit
from the Borrower or the Project or in any contract or subcontract or agreement, or the proceeds
thereof, relating to the Project or the Property itself, either for themselves or for those with whom
they have family or business ties, during their tenure with Lender or one year thereafter.
4.2 Modifications for Lenders and Investors. This Agreement may be amended only
by a writing signed by authorized representatives of the Lender and the Borrower and Borrower’s
limited partner. The City Manager or his/her designee shall be authorized to act on behalf of the
Lender and may amend this Agreement, City Note, Regulatory Agreements, City Deed of Trust,
as may be reasonably requested by Project lenders and investors.
4.3 Action by the City. Except as may be otherwise specifically provided herein,
whenever any approval, notice, direction, consent or request by the City is required or permitted
under this Agreement, such action shall be in writing, and such action may be given, made or taken
by the City Manager or by any person who shall have been designated by the City Manager,
without further approval by the City Council unless the City Manager determines in his or her
reasonable discretion that such action requires such approval.
4.4 Non-Liability of City and City Officials, Employees and Agents. No member,
official, employee or agent of the City shall be personally liable to Borrower, or any successor in
interest, in the event of any default or breach by the City, or for any amount of money which may
become due to Borrower or its successor or for any obligation of the City under this Agreement.
4.5 Further Assurances. The Parties shall execute, acknowledge and deliver to the
other such other documents and instruments, and take such other actions, as either shall reasonably
request as may be necessary to carry out the intent of this Agreement.
4.6 Notice. Any notice required or authorized under this Agreement shall be effective
if provided to the party in question at the address shown below in accordance with this Section:
Lender: City of South San Francisco
400 Grand Avenue
City of South San Francisco
With a copy to: Sky Woodruff, City Attorney
Meyers Nave
1999 Harrison Street, 9th Floor
Page 19
Willow Gardens/Greenridge Recast Loan Agreement
Oakland, CA 94612
Borrower: MP Willow Greenridge Associates, L.P.
303 Vintage Park Drive, Suite 250
Foster City, California 94404
Attention: Assistant Secretary
With a copy to: Hudson SLP LLC
c/o Hudson Housing Capital LLC
630 Fifth Avenue, 28th Floor
New York, New York 10111
Attention: Joseph A. Macari
All such notices shall be sent by:
a. personal delivery, in which case notice is effective upon delivery;
b. certified or registered mail, return receipt requested, in which case notice shall be
deemed delivered on receipt if delivery is confirmed by a return receipt;
c. nationally recognized overnight courier, with charges prepaid or charged to the
sender’s account, in which case notice is effective on delivery if delivery is
confirmed by the delivery service; or
d. electronic mail, in which case notice shall be deemed delivered upon transmittal,
provided that, (i) a duplicate copy of the notice is promptly delivered by first-class
or certified mail or by overnight delivery (in which case notice shall be deemed
given two business days after the duplicate is deposited in the mail), or (ii) receipt
is voluntarily acknowledged by the party to be noticed (in which case notice shall
be deemed given when acknowledged), and the electronic mail is sent to an address
approved for these purposes under this Agreement by an authorized representative
of Borrower or the City.
4.7 No Waiver, Modification and Amendment. No failure or delay on the part of the
City in exercising any right, power, or remedy hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right, power, or remedy preclude any other or
further exercise thereof or the exercise of any other right, power, or remedy hereunder. No
modification or waiver of any provision of this Agreement, nor any consent to any departure
Page 20
Willow Gardens/Greenridge Recast Loan Agreement
by Borrower therefrom, shall in any event be effective unless the same shall be in writing, and
then such waiver or consent shall be effective only in the specific instance and for the specific
purpose for which given. No notice to or demand on Borrower in any case shall entitle
Borrower to any other or further notice or demand in similar or other circumstances unless
expressly provided herein or by law. No amendment to or modification of this Agreement
shall be effective unless and until such amendment or modification is in writing, properly
approved in accordance with applicable procedures, and executed by the Parties.
4.8 Parties Not Co-Venturers. Nothing in this Agreement is intended to or shall
establish the Parties as partners, co-venturers, or principal and agent with one another.
4.9 Severability. Should any provision of this Agreement be found invalid by a court
or other body of competent jurisdiction, said invalidity or ineffectiveness shall not affect the
validity of the remaining provisions which shall remain in force to the maximum extent possible.
4.10 Successors and Assigns. This Agreement shall be binding upon and inure to the
benefit of the parties and their respective successors and assigns. Notwithstanding the foregoing,
the City's obligation to make the Loan is personal to Borrower, and shall not be assignable by
operation of law or otherwise absent the express prior written consent of the City or as expressly
provided for herein, and any such prohibited assignment by operation of law or otherwise shall be
void. The City shall not unreasonably delay, condition, or withhold its consent to an assignment
of this Agreement by Borrower to a tax credit limited partnership in which Borrower or an affiliate
of Borrower is a general partner.
4.11 Titles and Headings. The titles and headings in this Agreement are for convenience
only and shall not be construed to affect the meaning or construction of any provision of this
Agreement.
4.12 Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of California.
4.13 Attorneys’ Fees. In the event any legal action is commenced to interpret or to
enforce the terms of this Agreement or to collect damages as a result of any breach thereof, the
prevailing party shall be entitled to receive the amount of its legal expenses, including reasonable
attorneys’ fees, expert legal fees and other legal costs and expenses.
4.14 No Third Party Beneficiary. This Agreement shall not be construed or deemed to
be an agreement for the benefit of any third party or parties, and no third party or parties shall have
any claim or right of action hereunder for any cause whatsoever.
4.15 No Pledging of Lender's Credit. Under no circumstances shall the Borrower have
the authority or power to pledge the credit of Lender or incur any obligation in the name of Lender.
Borrower shall save and hold harmless Lender, its City Council, its officers, employees, and boards
and commissions for expenses arising out of this Agreement.
4.16 Venue. In the event that suit shall be brought by any party to this Agreement, the
parties agree that venue shall be exclusively vested in the state courts of the County of San Mateo,
or where otherwise appropriate, exclusively in the United States District Court, Northern District
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Willow Gardens/Greenridge Recast Loan Agreement
of California, San Francisco, California. Borrower irrevocably consents to service, jurisdiction,
and venue of such courts for any such litigation and waives any other venue to which it might be
entitled by virtue of domicile, habitual residence or otherwise.
4.17 Entire Agreement; Exhibits. The City Loan Documents contain the entire
agreement between the parties with respect to the subject matter hereof. This Agreement
supersedes all prior oral or written agreements between the parties with respect thereto. Exhibits
attached hereto are incorporated herein by this reference.
4.18 Counterparts. This Agreement may be executed in multiple counterparts, each of
which shall be an original and all of which together shall constitute one and the same instrument.
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Willow Gardens/Greenridge Recast Loan Agreement
IN WITNESS WHEREOF, the Lender and the Borrower have executed this Agreement as of the
date first set forth above.
LENDER: BORROWER:
City of South San Francisco, a
municipal corporation
By:
Its: CITY MANAGER
MP Willow Greenridge Associates, L.P.,
a California limited partnership
By: MP Greenridge LLC,
a California limited liability company,
its general partner
By: Mid-Peninsula Half Moon Bay, Inc.,a
California nonprofit public benefit
corporation, its sole member/manager
By: __________________________
Jan M. Lindenthal
Assistant Secretary
APPROVED AS TO FORM:
______________________________
City Attorney
Page 23
Willow Gardens/Greenridge Recast Loan Agreement
EXHIBIT A
Legal Description Willow Gardens Property
Page 24
Willow Gardens/Greenridge Recast Loan Agreement
EXHIBIT B
Legal Description Greenridge Property
Page 25
Willow Gardens/Greenridge Recast Loan Agreement
EXHIBIT C
Scope of Work and Timeline
3872997.1
AMENDED AND RESTATED PROMISSORY NOTE
CITY OF SOUTH SAN FRANCISCO
(Willow Gardens/Greenridge)
$[__________] South San Francisco, California
[_________] 1, 2021
FOR VALUE RECEIVED, the undersigned MP Willow Greenridge Associates, L.P., a
California limited partnership (the “Maker”) hereby promises to pay to the City of South San
Francisco, a municipal corporation (the “Holder”), the principal amount of __________________
Dollars ($_________), or so much of such principal as may be advanced, plus interest thereon
pursuant to Section 3 below (the “Loan”).
1. Maker’s Obligation. This amended and restated promissory note (the “Note”)
evidences the Maker’s obligation to pay the Holder the principal amount of [____________
Dollars ($_____________)] loaned by the Holder to Maker pursuant to the Amended and Restated
Loan Agreement (the “Loan Agreement”) and certain Regulatory Agreements and Declaration of
Restrictive Covenants between the Maker and the Holder dated concurrently herewith (collectively
with the Loan Agreement, the “Agreements”). As more further set forth in the Loan Agreement,
this Note amends and restates in their entirety those certain promissory notes (i) dated September
30, 1998 in the original principal amount of $940,000 (the “Greenridge RDA Note”), (ii) dated
January 4, 1999 in the original principal amount of $3,500,000 (the “WG RDA Note”), (iii) dated
January 4, 1999 in the original principal amount of $619,055 (the “Original HOME Note”), (iv)
dated November 19, 2002 in the original principal amount of $500,000 (the “Original City Note”),
and (v) dated August 3, 2016 in the original principal amount of $500,000 (the “Second HOME
Note” and collectively with the Greenridge RDA Note, WG RDA Note, Original HOME Note and
Original City Note, the “Existing Notes”), which notes are hereby cancelled and of no further force
and effect. Maker has requested and Holder has agreed to loan such funds to Maker to finance
Maker’s rehabilitation and refinancing of the Property located at 986 Nora Way, 982, 986, and
990 Brusco Way, 344, 364, 383 & 395 Susie Way, 976 Sandra Court, and 1565 El Camino Real
in the City of South San Francisco, as further described in the Agreements. All capitalized terms
not otherwise defined in this Note shall have the meanings set forth in the Loan Agreement.
2. Security. Payment of this Note is secured by a deed of trust, assignment of rents,
security agreement and fixture filing (the “Deed of Trust”) from Maker to Holder, wherein the
Maker is the Trustor and the Holder is the Beneficiary, to be recorded against the Maker’s title to
the Property and ownership interest in the Project.
3. Interest Rate. The principal amount of the Loan shall bear [INTEREST AT AFR]
percent ([_]%) interest, compounded annually; provided, however, if a Default occurs, interest on
the principal balance shall begin to accrue, as of the date of Default and continuing until such time
as the Loan funds are repaid in full or the Default is cured, at the default rate of the lesser of ten
percent (10%), compounded annually, or the highest rate permitted by law. The principal amount
of the Loan includes the amount of all accrued and unpaid interest outstanding on the Existing
Notes as of the date of this Note.
Willow Gardens/Greenridge Recast Prom Note 2
4. Term. The Term of this Loan shall commence on the date of this Note and end on the
date that is fifty-five (55) years from the date of completion of the Project’s
rehabilitation scope of work, as evidenced by a temporary certificate of occupancy or
equivalent unless extended by the mutual consent of the parties, but in any event no
later than December 31, 2078 (“Maturity Date”) or (ii) any sale, refinancing, or other
full or partial transfer of interest in the Property without Holder’s prior written consent,
and excepting any such transactions expressly permitted pursuant to the Loan
Agreement.
5. Payment. All sums due under this Note shall be due and payable in full upon the
Maturity Date. Notwithstanding the foregoing, voluntary early payments may be made without
prepayment penalty. Payments of principal, and any interest that may be accrued pursuant to
Section 3 above, shall be payable from Residual Receipts as defined below and shall be due and
payable annually as set forth below, commencing the first full year following completion of the
rehabilitation of the Project as evidenced by a temporary certificate of occupancy or equivalent.
Thereafter, Maker shall begin making annual residual receipts payments to Holder, as follows:
a) Annual payments equal to Holder’s proportionate share of Fifty Percent
(50%) of any Residual Receipts, as defined below, that are available to Maker after payment of
any required Project debt service. Holder’s proportionate share shall be determined based on the
Loan amount divided by the total loan amount of all other loans from public agencies to the Maker
for the Project repayable from Residual Receipts.
b) Payments received from Maker by Holder under this Note will be first
applied to outstanding interest, if any, and then to any principal outstanding on the Note until the
Note is paid in full. The entire outstanding principal balance plus any unpaid accrued interest will
be due and payable on the Maturity Date.
c) Commencing the first full year following completion of the rehabilitation
of the Project, annual payments will be due no later than 150 days after the close of the Property’s
fiscal year, without notice by Holder. Commencing the first full year following completion of the
rehabilitation of the Project, a copy of the annual independent financial audit determining the
amount of Residual Receipts payment due to the Holder shall also be delivered to Holder not later
than 150 days after the end of each of the Project's fiscal years.
d) Residual Receipts is defined as the amount by which Gross Revenue
exceeds Annual Operating Expenses within the Project’s fiscal year, as defined below:
“Gross Revenue” is defined as all rental and incidental income less any utility allowances from
the Project, but excluding loan proceeds, insurance proceeds (except those for loss of business),
interest on restricted reserves, capital contributions, any revenue derived from any refinancing of
the Project, tenant security deposits, and any interest earned on said deposits.
"Annual Operating Expenses" means costs reasonably and actually incurred for operations and
maintenance of the Project, to the extent that they are consistent with an annual independent audit
performed by a certified public accountant using generally acceptable accounting principles.
Willow Gardens/Greenridge Recast Prom Note 3
“Annual Operating Expenses” include the following:
(i) property and other taxes and assessments imposed on the Project;
(ii) premiums for property damage and liability insurance;
(iii) utility services not paid for directly by the tenants, including but not limited to water,
sewer, trash collection, gas and electricity;
(iv) maintenance and repair including but not limited to pest control, landscaping and
grounds maintenance, painting, and decorating, cleaning, common systems repairs,
general repairs, janitorial supplies, and others;
(v) any license or certificates of occupancy fees required for operation of the Project;
(vi) general administrative expenses including but not limited to advertising, marketing,
security services and systems, professional fees for legal, audit, accounting and tax
returns, and other for the Project;
(vii) property management fees and reimbursements including on-site manager expenses,
not to exceed fees and reimbursements which are standard in the industry and pursuant
to a management contract approved by the City (which such approval will not be
unreasonably withheld);
(viii) Any deferred developer fee in an amount pre-approved by the City;
(ix) Any advances or loans made by the owner or affiliate thereof to fund operating
shortfalls following syndication of the low-income housing tax credits;
(x) Annual deposits into a reserve for capital replacements of Project improvements in an
amount of [Five Hundred Dollars ($500)] per unit or such other amount as approved
by a senior lender, Maker’s limited partner, or the City (to be increased annually by
[3%]);
(xi) Any deposits to an Operating Reserve as required by a senior lender, Maker’s limited
partner, or approved by the City;
(xii) Current and accrued annual resident services increasing by no more than [3%] percent
per year, or such greater amount as approved by the City (such approval may be
provided in the form of an approved property budget);
(xiii) current and accrued partnership management fees with annual earnings not to exceed
[$25,000] per year, adjusted annually for inflation by [3%] percent per year;
(xiv) current and accrued asset management fees payable to the limited partner (if applicable)
of Maker, with annual earnings in an amount not to exceed $[7,500] per year, adjusted
annually for inflation by [3%] percent per year; and
(xv) debt service payments of loans in senior position to this Loan.
Annual operating expenses will not include the following: depreciation, amortization, depletion,
or other non-cash expenses, or any amount expended from a reserve account.
6. No Assumption. This Note shall not be assumable by the successors and assigns
of Maker without the prior written consent of the Holder, except as permitted in the Loan
Agreement.
7. Security. This Note is secured by the Deed of Trust.
8. Terms of Payment.
Willow Gardens/Greenridge Recast Prom Note 4
(a) All payments due under this Note shall be paid in currency of the United
States of America, which at the time of payment is lawful for the payment of public and private
debts.
(b) All payments on this Note shall be paid to Holder at
[__________________________], Attention: Housing Officer or to such other place as the Holder
of this Note may from time to time designate.
(c) All payments on this Note shall be without expense to the Holder, and the
Maker agrees to pay all costs and expenses, including re-conveyance fees and reasonable
attorney’s fees of the Holder, incurred in connection with the payment of this Note and the release
of any security hereof.
(d) Notwithstanding any other provision of this Note, or any instrument
securing the obligations of the Maker under this Note, if, for any reason whatsoever, the payment
of any sums by the Maker pursuant to the terms of this Note would result in the payment of interest
which would exceed the amount that the Holder may legally charge under the laws of the State of
California, then the amount by which payments exceeds the lawful interest rate shall automatically
be deducted from the principal balance owing on this Note, so that in no event shall the Maker be
obligated under the terms of this Note to pay any interest which would exceed the lawful rate.
9. Default.
(a) Any of the following shall constitute an Maker event of default under this
Note:
(i) Any failure by Maker to pay Holder, in full, any payment required
under this Note within ten (10) days of written notice that such payment is due;
(ii) Any failure in the performance by the Maker of any term, condition,
provision or covenant set forth in this Note subject to the notice and cure period set forth in the
Agreements;
(iii) The occurrence of any event of default under the Loan Agreement,
Regulatory Agreements, the Deed of Trust, or other instrument securing the obligations of the
Maker under this Note or under any other promissory notes hereafter issued by the Maker to the
Holder pursuant to the Loan Agreement or the Deed of Trust, subject to notice and cure periods,
if any, set forth therein.
(b) Subject to the rights of senior lenders, upon the occurrence of an event of default
(“Trigger Date”), Holder shall provide to Maker written notice of said occurrence, and
Maker shall have thirty (30) days to cure. If the default cannot reasonably be cured in thirty
(30) days, Maker shall have an additional one hundred fifty (150) days to cure, provided
the cure has commenced within thirty (30) days and is diligently pursued to completion.
If, after the time provided in this subparagraph (b), Maker has not cured the default, or
Holder has not waived its rights under the Note, the entire unpaid balance, together with
all other sums then payable under this Note, shall, at the option of Holder, become
Willow Gardens/Greenridge Recast Prom Note 5
immediately due and payable upon written notice by Holder to Maker without further
demand. In addition, all amounts disbursed by Holder pursuant to the City Deed of Trust
to protect Holder’s rights in the Property, if any, shall be due and payable under this Note.
All sums due pursuant to this Section shall, commencing on the Trigger Date, accrue
interest at an annual rate equal to the lesser of 10% compounded quarterly, or the maximum
rate permitted by law. Notice to Maker shall be at the addresses specified in the
Agreements and in accordance with Section 10(a) below.
(c) The failure to exercise the remedy set forth in Subsection 7(b) above or any
other remedy provided by law upon the occurrence of one or more of the foregoing events of
default shall not constitute a waiver of the right to exercise any remedy at any subsequent time in
respect to the same or any other default. The acceptance by Holder hereof of any payment which
is less than the total of all amounts due and payable at the time of such payment shall not constitute
a waiver of the right to exercise any of the foregoing remedies or options at that time or at any
subsequent time, or nullify any prior exercise of any such remedy or option, without the express
consent of the Holder, except as and to the extent otherwise provided by law.
10. Waivers.
(a) The Maker hereby waives diligence, presentment, protest and demand, and
notice of protest and nonpayment, notice of demand, notice of default or delinquency, notice of
acceleration, notice of costs, expenses or losses and interest thereon, notice of interest on interest
and late charges, and diligence in taking any action to collect any sums owing under this Note or
in proceeding against any of the rights or interest in or to properties securing payment of this
Note and notice of dishonor of this Note. Debtor further waives any right to plead any and all
statutes of limitation as a defense to any demand on this Note.
(b) The Maker expressly agrees that this Note or any payment hereunder may be
extended from time to time, and that the Holder may accept further security or release any security
for this Note, all without in any way affecting the liability of the Maker.
(c) No extension of time for payment of this Note or any installment hereof
made by agreement by the Holder with any person now or hereafter liable for payment of this Note
shall operate to release, discharge, modify, change or affect the original liability of the Maker
under this Note, either in whole or in part.
(d) The obligations of the Maker under this Note shall be absolute and the
Maker waives any and all rights to offset, deduct or withhold any payments or charges due under
this Note for any reason whatsoever.
(e) A waiver of any term of this Note, the Deed of Trust, or the Agreement
must be made in writing, signed by both parties, and shall be limited to the express written terms
of such waiver. In the event of any inconsistencies between the terms of this Note and the terms
of any other document related to the debt evidenced by this Note, the terms of this Note shall
prevail. No modification or amendment of this Note shall be effective unless in a writing signed
by Maker and Holder.
Willow Gardens/Greenridge Recast Prom Note 6
11. Miscellaneous Provisions.
(a) All notices to the Holder or the Maker shall be given in the manner and at
the addresses set forth in the Agreements, or to such addresses as the Holder and the Maker may
hereinafter designate.
(b) Maker agrees to pay on demand, together with interest at the rate specified
above in Section 9(b) from the date of such demand until paid, all reasonable attorneys’ fees, costs
of collection, costs, and expenses incurred by Holder in connection with the defense or
enforcement of this Note and the City Deed of Trust, whether or not a legal action or proceeding
is filed.
(c) No modification or amendment of this Note shall be effective unless in a
writing signed by Mare and Holder.
This Note shall be governed by and construed in accordance with the laws of the State of
California.
(d) Time is of the essence with respect to every provision in this Note. This
Note shall be construed and enforced in accordance with the substantive and procedural laws of
the State of California, except to the extent that federal laws preempt the laws of the State of
California, and all persons and entities in any manner obligated under this Note consent to the
jurisdiction of any federal or state court within the State of California having proper venue and
also consent to service of process by any means authorized by California or federal law. If any
provision of this Note shall be found to be invalid, illegal or unenforceable by a court of
competent jurisdiction, the remaining provisions hereof shall not be affected or impaired thereby.
(e) This document, together with the Loan Documents, contains the entire
agreement between the parties as to the Loan. It may not be modified except upon written consent
of the parties.
12. Nonrecourse. This Note shall be nonrecourse to the Maker and any members or
partners.
Willow Gardens/Greenridge Recast Prom Note 7
MAKER:
MP Willow Greenridge Associates, L.P.,
a California limited partnership
By: MP Greenridge LLC,
a California limited liability company,
its general partner
By: Mid-Peninsula Half Moon Bay, Inc.,
a California nonprofit public benefit corporation,
its sole member/manager
By: __________________________
Jan M. Lindenthal
3873027.1
Eight Trees Phase Two Regulatory Agreement Recast 1
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
City of South San Francisco
400 Grand Avenue
South San Francisco, CA 94080
No fee for recording pursuant to
Government Code Section 27383
APNs: 011-270-200, 011-264-020, 011-270-360, 011-270-100, 011-270-110, 011-270-120, 011-271-100, 011-270-300, 011-270-
170, 010-440-670
REGULATORY AGREEMENT AND DECLARATION
OF RESTRICTIVE COVENANTS
(Willow Gardens/Greenridge)
This Regulatory Agreement and Declaration of Restrictive Covenants (the "Agreement")
is made and entered into as of [__________] [__], 2021, by and between the City of South San
Francisco, a municipal corporation (the "City") and MP Willow Greenridge Associates, L.P., a
California limited partnership (the "Borrower").
RECITALS
A. The Borrower owns certain real property located at 986 Nora Way, 982, 986, and
990 Brusco Way, 344, 364, 383 & 395 Susie Way, and 976 Sandra Court, City of South San
Francisco, County of San Mateo, State of California as more particularly described in Exhibit A
attached hereto (the “Willow Gardens Property”), and certain real property located at 1565 El
Camino Real, City of South San Francisco, County of San Mateo, State of California as more
particularly described in Exhibit B attached hereto (the “Greenridge Property” and collectively
with the Willow Gardens Property, the “Property”).
B. The City and the Borrower have entered into an Amended and Restated Loan
Agreement (the “Loan Agreement”) concurrently herewith, pursuant to which the City will provide
a loan (the "Loan") to the Borrower to rehabilitate thirty-four (34) apartment units, including one
(1) unrestricted manager’s unit, located on the Greenridge Property and thirty-six (36) apartment
units, including one (1) unrestricted manager’s unit, located on the Willow Gardens Property (the
“Project”), as further set forth and described in the Loan Agreement. The Property is and shall
continue to be operated as affordable rental housing projects for Lower Income Households as
defined herein. Capitalized terms used but not defined in this Agreement shall have the meanings
set forth in the Loan Agreement (as defined below).
C. As a condition of providing the Loan, the City requires the Borrower to execute this
Agreement, which will regulate eleven (11) residential units of the Property as “HOME Assisted
Units” in accordance with the schedule of units in Exhibit C attached hereto and incorporated
herein, to ensure that the units are occupied by and affordable to Lower-Income Households for
Eight Trees Phase Two Regulatory Agreement Recast 2
the term of this Agreement. The HOME Assisted Units will be monitored by the City for
compliance with HOME affordability and related program requirements as set forth herein.
NOW THEREFORE, in consideration of the recitals, hereof, and other mutual covenants
and promises contained herein and for other valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the City and the Borrower hereby agree as follows.
ARTICLE 1
DEFINITIONS
1.1 Definitions
When used in this Agreement, the following terms shall have the respective meanings
assigned to them in this Article 1.
(a) "Adjusted Income" shall mean the total anticipated annual income of all
persons in a household as calculated in accordance with 24 CFR 92.203(b)(l), which incorporates
24 CFR 5.609m
(b) "Agreement" shall mean this Regulatory Agreement and Declaration of
Restrictive Covenants.
(c) “Area Median Income” shall mean the median gross yearly household
income, adjusted for household size for San Mateo County, as published from time to time by
HUD. In the event that such income determinations are no longer published by HUD, or are not
updated for a period of at least eighteen (18) months, the City shall provide the Borrower with
other income determinations which are reasonably similar with respect to methods of calculation
to those previously published by HUD.
(d) “Assumed Household Size” shall mean, solely for the purposes of
establishing maximum rent limits for the HOME Assisted Units, a household size equal to the
number of bedrooms in the Unit, times one and a half. For example, the Assumed Household
Size for a two-bedroom unit shall be a household of three. Assumed Household Size is not
intended to be used as a maximum occupancy limit for the Units.
(e) "Borrower" shall mean MP Willow Greenridge Associates, L.P., a
California limited partnership and its successors and assigns to the Project.
(e) "City" shall mean the City of South San Francisco, a municipal corporation.
(f) "Deed of Trust" shall mean the deed of trust for the benefit of the City on
the Property which secures repayment of the Loan and the performance of the Loan Agreement
and this Agreement.
(h) “Greenridge Property” shall have the meaning set forth in Recital A.
Eight Trees Phase Two Regulatory Agreement Recast 3
(i) “Household Size” shall mean the actual number of persons in the applicant
or Tenant household.
(j) “HOME Assisted Units” shall mean the eleven (11) floating dwelling units
within the Willow Gardens Property, the development of which will be assisted with funds
provided through the HOME Program.
(k) “HOME Rents” means rents calculated annually by HUD and are:
a. the lesser of the fair market rents or thirty percent (30%) of sixty-five
percent (65%) of Area Median Income (high HOME rents); and
b. thirty percent (30%) of fifty percent (50%) of Area Median Income
(low HOME rents).
(l) “HUD” means the United States Department of Housing & Urban
Development.
(m) “Loan” shall mean all funds loaned to the Borrower by the City pursuant to
the Loan Agreement.
(j) "Loan Agreement" shall mean the Amended and Restated Loan Agreement
entered into by and between the City and the Borrower, dated concurrently herewith.
(k) “Low-Income Household” or “Lower-Income Household” shall mean a
household whose Adjusted Income does not exceed eighty percent (80%) of the Area Median
Income.
(l) "Low Income Rent" shall mean the maximum allowable rent for a Low-
Income Household pursuant to Section 2.2(a) below.
(n) “Multifamily Tax Subsidy Program” (MTSP) shall mean the Low Income
Housing Tax Credit program promulgated under Section 42 of the Internal Revenue Code.
(o) "Note" shall mean the City Note from the Borrower to the City, as defined
in the Loan Agreement, evidencing all or any part of the Loan.
(p) "Project" shall have the meaning set forth in Recital B above and as further
described in the Loan Agreement.
(q) "Property" shall mean the real property described in Exhibits A and B
attached hereto and incorporated herein.
(r) "Rent" shall mean the total of monthly payments by the Tenant of a HOME
Assisted Unit for the following: use and occupancy of the Unit and land and associated facilities,
including parking; any separately charged fees or service charges assessed by the Borrower which
Eight Trees Phase Two Regulatory Agreement Recast 4
are required of all Tenants, other than security deposits; an allowance for the cost of an adequate
level of service for utilities paid by the Tenant, including electricity, gas and other heating, cooking
and refrigeration fuel, but not telephone service or cable TV; and any other interest, taxes, fees or
charges for use of the land or associated facilities and assessed by a public or private entity other
than the Borrower, and paid by the Tenant.
(s)"Tenant" shall mean a household lawfully occupying a Unit subject to a valid
lease.
(t) "Term" shall mean the term of this Agreement, which shall commence on
the date of this Agreement and shall continue until the earlier of the fifty-fifth (55th) anniversary
date of completion of the rehabilitation scope of work, as evidenced by a Temporary Certificate of
Occupancy or equivalent, or a specified later date in the event the City and Borrower agree to
extend such term.
(u) "Unit" for leasing and management purposes, shall mean one of the sixty-
eight (68) apartments in the Property, and does not include the manager’s units. The Units,
pursuant to Section 2.1 below, are required to be occupied by, or if vacant available for occupancy
by Low, 60% AMI, and Very Low Income Households.
(v) "Very Low Income Household" shall mean a household with an Adjusted
Income, adjusted for household size, that does not exceed 50% of Area Median Income.
(w) "Very Low Income Rent" shall mean the maximum allowable rent for a
Very Low Income Household pursuant to Section 2.2(b) below.
(x) “Willow Gardens Property” shall have the meaning set forth in Recital A.
ARTICLE 2
AFFORDABILITY AND OCCUPANCY COVENANTS
2.1 Occupancy Requirements.
HOME Assisted Units. Eight (8) of the HOME Assisted Units shall be
rented to and occupied by or, if vacant, available for occupancy by Low Income Households, and
three (3) of the HOME Assisted Units shall be rented to and occupied by or, if vacant, available
for occupancy by Very Low Income Households in accordance with Exhibit C.
2.2 Allowable Rent
(a) HOME Rents. HOME Rents shall be used for determining the rents for the
HOME Assisted Units. Eight (8) of the HOME Assisted Units must be occupied by Low Income
Eight Trees Phase Two Regulatory Agreement Recast 5
Households paying rents that are no greater than the high HOME rents. Three (3) of the HOME
Assisted Units must be occupied by Very Low Income Households paying rents that are no
greater than the low HOME rents. The HOME Rents (as calculated annually by HUD and as set
forth in the definition above) shall be provided annually by the City.
(b) Housing Assistance Payment Contracts; Project Based Vouchers. In the
event that some or all of the HOME Assisted Units are subject to a valid Housing Assistance
Payment (“HAP”) contract with HUD and/or the San Mateo County Housing Authority (including
a HAP contract in connection with tenant-based Housing Choice Vouchers), the allowable Rent
may be determined by the parties to the HAP contract and may exceed the allowable Rent set forth
above. Borrower shall provide notice to City that a HAP contract has been executed, and such
notice shall identify which units will be subject to the HAP contract, and the term of HAP contract
applicable to each unit. Executed HAP contract(s) shall be made available for City inspection
upon request. Under applicable federal law, prior to the expiration of any HAP assistance,
Borrower shall notify Tenant that their Rent may be increased to the applicable allowable Rent
limit specified herein.
(g) Hold Harmless. Notwithstanding anything to the contrary contained
herein, with respect to the Area Median Income determination under this Agreement, the City
shall allow Borrower to apply the same “hold harmless” policy implemented by the California
Tax Credit Allocation Committee in the event that the Area Median Income decreases in any
given calendar year.
2.3 Increased Income of Tenants
(a) Non-Qualifying Households in HOME Assisted Units. If, upon
recertification of the income of a Tenant of a HOME Assisted Unit, the Borrower
determines that
(i) A former Very Low Income Household’s Adjusted Income has
increased and exceeds the income limit for an Very Low Income Household as
defined above, upon sixty (60) days’ written notice to Tenant, such Tenant’s rent
may be increased to Low Income Rent (as applicable based on Adjusted Income),
and the next available Low Income Unit (as applicable) may be rented to a Very
Low Income Household in compliance with Exhibit C.
AND/OR
(ii) A former Low Income Household’s Adjusted Income has increased
and exceeds the income limit for a Low Income Household as defined above, upon
sixty (60) days’ written notice to Tenant, such Tenant’s rent may be increased to
30% of the Tenant’s actual monthly household income or to a comparable rent for
Low Income Households occupying units of comparable size. If such an increase
is expressly prohibited under a deed restriction of a lienholder senior to the City
lien, or federal IRS tax credit regulations applicable to the Property at the time, the
Eight Trees Phase Two Regulatory Agreement Recast 6
rent shall remain at the then-current Low Income Rent Limit, and the number of
Low Income Units occupied by Tenants with incomes over the Low Income Rent
limit shall be reported to the City on an annual basis in Borrower’s annual reports
to the City as required under Section 4.2 herein.
(b) Over Income Households. Notwithstanding anything to the contrary
contained herein, if any household’s income has been determined to be at or above 120%
Area Median Income for two consecutive annual income certifications, Borrower may
terminate such tenant’s lease with a six (6) month notice to vacate.
(c) Termination of Occupancy. Upon termination of occupancy of a HOME
Assisted Unit by a Tenant, such HOME Assisted Unit shall be deemed to be
continuously occupied by a household of the same income level (e.g., Very Low
Income Household) as the initial income level of the vacating Tenant, if such Unit is
reoccupied by a household of the same income level within 120 days of vacancy of the
Unit by the prior Tenant, at which time the status of the Unit shall be determined based
on the income level of the new Tenant.
2.4 Notwithstanding anything to the contrary contained herein, for so long as the
Property is subject to the requirements of the Multifamily Tax Subsidy Program, the applicable
TCAC/MTSP requirements related to rent and income limits shall apply in lieu of the restrictions
set forth herein with respect to rent and income limits.
ARTICLE 3
INCOME CERTIFICATION AND REPORTING
3.1 Income Certification.
The Borrower will obtain, complete and maintain on file, immediately prior to initial
occupancy and annually thereafter, income certifications from each Tenant renting any of the
Units. The Borrower shall make a good faith effort to verify that the income provided by an
applicant or occupying household in an income certification is accurate by taking two or more of
the following steps as a part of the verification process: (a) obtain a pay stub for the most recent
pay period; (b) obtain an income tax return for the most recent tax year; (c) conduct a credit agency
or similar search; (d) obtain an income verification form from the applicant's current employer; (e)
obtain an income verification form from the Social Security Administration and/or the California
Department of Social Services if the applicant receives assistance from either of such agencies; or
(f) if the applicant is unemployed and has no such tax return, obtain another form of independent
verification. Copies of Tenant income certifications shall be available to the City upon request.
Initial household income certification shall be consistent with the "Part 5 Method" described
in 24 CFR 5.609.
In the event that annual recertification of Tenant incomes indicates that the number of
HOME Assisted Units actually occupied by Low, or Very Low Income Households, as applicable,
falls below the number reserved for each income group as specified in Exhibit C attached hereto,
Borrower shall rectify the condition by renting the next available dwelling unit(s) in the Project to
a Low, or Very Low Income Household(s), as applicable, until the required income mix is
achieved.
Eight Trees Phase Two Regulatory Agreement Recast 7
3.2. Annual Report to the City.
The Borrower shall submit to the City (a) not later than the ninetieth (90th) day after the
close of each fiscal year, or such other date as may be requested by the City, a statistical report,
including income and rent data for the HOME Assisted Units, setting forth the information called
for therein.
3.3 Additional Information.
The Borrower shall provide any additional information reasonably requested by the City
to the City. The City shall have the right to examine and make copies of all books, records or other
documents of the Borrower which pertain to the Project.
3.4 Records.
The Borrower shall maintain complete, accurate and current records pertaining to the
Project, and shall permit any duly authorized representative of the City to inspect records,
including records pertaining to income of Tenants. All Tenant lists, applications and waiting lists
relating to the Project shall at all times be kept separate and identifiable from any other business
of the Borrower and shall be maintained as required by the City, in a reasonable condition for
proper audit and subject to examination during business hours by representatives of the City. The
Borrower shall retain copies of all materials obtained or produced with respect to occupancy of the
Units for a period of at least five (5) years.
3.5 On-site Inspection.
The City shall each have the right to perform an on-site inspection of the Project at least
one time per year with adequate notice to Borrower, a minimum of thirty (30) days. The Borrower
agrees to cooperate in such inspection.
ARTICLE 4
OPERATION OF THE PROJECT
4.1 Use of the Project.
The Property shall be operated as affordable rental housing consisting of sixty-eight (68)
Units, plus one unrestricted unit for an on-site property manager at each of the Willow Gardens
Property and the Greenridge Property.
4.2 Compliance with Loan Agreement.
Borrower shall comply with all the terms and provisions of the Loan Agreement, and the
Deed of Trust for the Project.
4.3 Taxes and Assessments.
Borrower shall pay all real and personal property taxes, assessments and charges and all
franchise, income, employment, old age benefit, withholding, sales, and other taxes assessed
against it, or payable by it, at such times and in such manner as to prevent any penalty from
accruing, or any line or charge from attaching to the Property; provided, however, that Borrower
shall have the right to contest in good faith, any such taxes, assessments, or charges. In the event
Borrower exercises its right to contest any tax, assessment, or charge against it, Borrower, on final
Eight Trees Phase Two Regulatory Agreement Recast 8
determination of the proceeding or contest, shall immediately pay or discharge any decision or
judgment rendered against it, together with all costs, charges and interest.
ARTICLE 5
PROPERTY MANAGEMENT AND MAINTENANCE
5.1 Management Responsibilities.
The Borrower is responsible for all management functions with respect to the Project,
including without limitation the selection of tenants, certification and recertification of household
size and income, evictions, collection of rents and deposits, maintenance, landscaping, routine and
extraordinary repairs, replacement of capital items, and security. The City shall have no
responsibility over management of the Project. The Borrower shall retain a professional property
management company approved by the City in its reasonable discretion to perform its management
duties hereunder, unless the City approves self-management by the Borrower. A resident manager
shall also be required.
(a) Accounting Records. In a manner subject to City approval, the Borrower
shall maintain, on an accrual or modified accrual basis, a general ledger accounting system that is
posted monthly and that accurately and fully shows all assets, liabilities, income and expenses of
the Project. All records and books relating to this system shall be kept for a period of at least seven
years and in such a manner as to ensure that the records are reasonably protected from destruction
or tampering. All records shall be subject to City inspection and audit.
(b) Use of Income from Operations. The Borrower, or its management agent,
shall promptly deposit all operating income in a segregated account established exclusively for the
Project with an FDIC or other comparable federally-insured financial institution.
5.2 Management Agent; Periodic Reports.
Unless the City approves self-management by the Borrower, the Project shall at all times
be managed by an experienced management agent reasonably acceptable to the City, with
demonstrated ability to operate residential facilities like the Project in a manner that will provide
decent, safe, and sanitary housing (as approved, the "Management Agent"). The Borrower shall
submit for the City's approval the identity of any proposed Management Agent. The Borrower
shall also submit such additional information about the background, experience and financial
condition of any proposed Management Agent as is reasonably necessary for the City to determine
whether the proposed Management Agent meets the standard for a qualified Management Agent
set forth above. If the proposed Management Agent meets the standard for a qualified
Management Agent set forth above, the City shall approve the proposed Management Agent by
notifying the Borrower in writing. Unless the proposed Management Agent is disapproved by the
City within thirty (30) days, which disapproval shall state with reasonable specificity the basis for
disapproval, it shall be deemed approved. The City hereby approves MidPen Property
Management Corporation as the Management Agent.
Eight Trees Phase Two Regulatory Agreement Recast 9
5.3 Performance Review.
The City reserves the right to conduct an annual (or more frequently, if deemed necessary
by the City) review of the management practices and financial status of the Project. The purpose
of each periodic review will be to enable the City to determine if the Project is being operated and
managed in accordance with the requirements and standards of this Agreement. The Borrower
shall cooperate with the City in such reviews.
5.4 Replacement of Management Agent.
If, as a result of a periodic review, the City determines in its reasonable judgment that the
Project is not being operated and managed in accordance with any of the material requirements
and standards of this Agreement, the City shall deliver notice to Borrower of its intention to cause
replacement of the Management Agent, or, if the Project is being self-managed, to cause the
Borrower to retain a Management Agent, including the reasons therefor. Within fifteen (15) days
of receipt by Borrower of such written notice, City staff, as applicable, and the Borrower shall
meet in good faith to consider methods for improving the financial and operating status of the
Project, including, without limitation, replacement of the Management Agent.
If, after such meeting, City staff, as applicable, recommends in writing the replacement of
the Management Agent, Borrower shall promptly dismiss the then Management Agent, or cease
self-management if the Project is self-managed and shall appoint as the Management Agent a
person or entity meeting the standards for a Management Agent set forth in Section 5.2 above and
approved by the City pursuant to Section 5.2 above.
Any contract for the operation or management of the Project entered into by Borrower shall
provide that the contract can be terminated as set forth above, or terminated without cause upon
thirty (30) days’ notice. Failure to remove the Management Agent or to appoint a Management
Agent instead of self-management in accordance with the provisions of this Section shall constitute
default under this Agreement, and the City may enforce this provision through legal proceedings
as specified in Section 6.8.
5.5 Approval of Management Policies.
The Borrower shall submit its written management policies with respect to the Project to
the City for its review, and shall amend such policies in any way necessary to ensure that such
policies comply with the provisions of this Agreement.
5.6 Property Maintenance.
The Borrower agrees, for the entire Term of this Agreement, to maintain all interior and
exterior improvements, including landscaping, on the Property in good condition and repair (and,
as to landscaping, in a healthy condition), reasonable wear and tear excepted, and in accordance
with all applicable laws, rules, ordinances, orders and regulations of all federal, state, City,
municipal, and other governmental agencies and bodies having or claiming jurisdiction and all
their respective departments, bureaus, and officials. The Borrower shall make all repairs and
replacements necessary to keep the improvements in good condition and repair.
ARTICLE 6
MISCELLANEOUS
Eight Trees Phase Two Regulatory Agreement Recast 10
6.1 Lease Provisions.
The Borrower shall use a form of Tenant lease approved by the City for HOME Assisted
Units. The form of Tenant lease shall also comply with all requirements of this Agreement and
shall include the following provisions for the HOME Assisted Units:
(a) provide for termination of the lease and consent by the Tenant to immediate
eviction for failure: (1) to provide any information required under this Agreement or reasonably
requested by the Borrower to establish or recertify the Tenant's qualification, or the qualification
of the Tenant's, for occupancy in the Project in accordance with the standards set forth in this
Agreement, or (2) to qualify as a Low, or Very Low Income Household, as a result of any material
misrepresentation made by such Tenant with respect to the income computation or certification.
(b) be for an initial term of not less than one (1) year, and provide for no Rent
increase during such period. After the initial lease term, such lease may be month to month by
mutual agreement of the Borrower and the Tenant; however the Rent may not be raised more often
than once a year. The Borrower will provide each Tenant at least sixty (60) days' written notice of
any increase in Rent applicable to such Tenant, and with such further notice as may be required by
Section 2.3 above.
(c) provide that any termination of a lease or refusal by the Borrower to renew
a lease, with the exception of evictions or non-renewals for non-payment of rent, must be preceded
by no less than thirty (30) days written notice to the Tenant by the Borrower specifying the grounds
for the action.
6.2 Nondiscrimination.
The Borrower shall not give preference to any particular class or group of persons in renting or
selling the Units, or any part of the Project except to the extent that the Units are required to be
leased to Low, Very Low Income Households. Borrower shall not restrict the rental, sale, lease,
sublease, transfer, use, occupancy, tenure or enjoyment of the Property or Project, or any portion
thereof, on the basis of race, color, religion, sex, gender, gender identity, gender expression,
sexual orientation, marital status, national origin, ancestry, familial status, source of income,
disability, or genetic information of any person. Borrower covenants for itself and all persons
claiming under or through it, and this Agreement is made and accepted upon and subject to the
condition that there shall be no discrimination against or segregation of any person or group of
persons on account of any basis listed in subdivision (a) or (d) of Section 12955 of the
Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and
paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code,
in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property, Project
or part thereof, nor shall Borrower or any person claiming under or through Borrower establish
or permit any such practice or practices of discrimination or segregation with reference to the
selection, location, number, use or occupancy of tenants, lessees, subtenants, sub lessees or
vendees in, of, or for the Property, Project or part thereof.
All deeds made or entered into by Borrower, its successors or assigns, as to any portion
of the Property or Project shall contain the following language, and all leases or contracts made
Eight Trees Phase Two Regulatory Agreement Recast 11
or entered into by Borrower, its successors or assigns, as to any portion of the Property or
Project, shall reference this Section, and shall enforce the same diligently and in good faith:
“(a) Borrower herein covenants by and for itself, its successors and assigns, and
all persons claiming under or through it, that there shall be no discrimination
against or segregation of a person or of a group of persons on account of any basis
listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those
bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1)
of subdivision (p) of Section 12955, and Section 12955.2 of the Government
Code, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of
the property herein conveyed nor shall the Borrower or any person claiming under
or through the Borrower establish or permit any such practice or practices of
discrimination or segregation with reference to the selection, location, number,
use or occupancy of tenants, lessees, subtenants, sub lessees or vendees in the
property herein conveyed. The foregoing covenant shall run with the land.
“(b) Notwithstanding paragraph (a), with respect to familial status, paragraph (a) shall not
be construed to apply to housing for older persons, as defined in Section 12955.9 of the
Government Code. With respect to familial status, nothing in paragraph (1) shall be construed to
affect Sections 51.2, 51.3, 51.4, 51.10, and 799.5 of the Civil Code, relating to housing for senior
citizens. Subdivision (d) of Section 51 of the Civil Code and subdivisions (d) of Section 12955 of
the Government Code shall apply to paragraph (a).” Nothing herein shall be construed or
interpreted as prohibiting or preventing preferences or set asides for the units as established in loan
agreements; regulatory agreements, etc., so long as such preferences or set asides comply with
applicable local, state, and federal laws.
6.3 Section 8 Certificate Holders.
The Borrower will accept as Tenants, on the same basis as all other prospective Tenants,
persons who are recipients of federal certificates for rent subsidies pursuant to the existing housing
program under Section 8 of the United States Housing Act, or its successor. The Borrower shall
not apply selection criteria to Section 8 certificate or voucher holders that are more burdensome
than criteria applied to all other prospective Tenants, nor shall the Borrower apply or permit the
application of management policies or lease provisions with respect to the Project which have the
effect of precluding occupancy of Units by such prospective Tenants.
6.4 Term.
The provisions of this Agreement shall apply to the Property for the entire Term even if
the Loan is paid in full prior to the end of the Term. This Agreement shall bind any successor,
heir or assign of the Borrower, whether a change in interest occurs voluntarily or involuntarily, by
operation of law or otherwise, except as expressly released by the City. The City makes the Loan
on the condition, and in consideration of, this provision, and would not do so otherwise.
6.5 Compliance with Loan Agreements and Program Requirements.
Borrower's actions with respect to the Project and the use of funds provided herein shall at
all times be in full conformity with all requirements of the Loan Agreement.
6.6 Notice of Expiration of Term.
Eight Trees Phase Two Regulatory Agreement Recast 12
At least six (6) months prior to the expiration of the Term, the Borrower shall provide by
first-class mail, postage prepaid, a notice to all Tenants in HOME Assisted Units containing (a)
the anticipated date of the expiration of the Term, (b) any anticipated Rent increase upon the
expiration of the Term, (c) a statement that a copy of such notice will be sent to the City, and (d)
a statement that a public hearing may be held by the City on the issue and that the Tenant will
receive notice of the hearing at least fifteen (15) days in advance of any such hearing. The
Borrower shall also file a copy of the above-described notice with the Housing Officer of the City.
6.7 Covenants to Run With the Land.
The City and the Borrower hereby declare their express intent that the covenants and
restrictions set forth in this Agreement shall run with the land, and shall bind all successors in title
to the Property, provided, however, that on the expiration of the Term of this Agreement said
covenants and restrictions shall expire. Each and every contract, deed or other instrument hereafter
executed covering or conveying the Property or any portion thereof, shall be held conclusively to
have been executed, delivered and accepted subject to such covenants and restrictions, regardless
of whether such covenants or restrictions are set forth in such contract, deed or other instrument,
unless the City expressly releases such conveyed portion of the Property from the requirements of
this Agreement.
6.8 Enforcement by the City.
If the Borrower fails to perform any obligation under this Agreement, and fails to cure the
default within thirty (30) days after the City has notified the Borrower in writing of the default or,
if the default cannot be cured within thirty (30) days, fails to commence to cure within thirty (30)
days and thereafter diligently pursue such cure and complete such cure within ninety (90) days,
the City shall have the right to enforce this Agreement by any or all of the following actions, or
any other remedy provided by law.
(a) Calling the Loan. The City may declare a default under the Note, accelerate
the indebtedness evidenced by the Note, including outstanding principal and interest, and demand
immediate repayment thereof. Upon failure to repay such accelerated amount in full, the City may
proceed with a foreclosure in accordance with the provisions of the Deed of Trust and State law
regarding foreclosures.
(b) Collect Rents. Collect all rents and income in connection with the operation
of the Project and use the same and the reserve funds for the operation and maintenance of the
Project.
(c) Excess Rents. In the event that the breach or violation involves the rents to
tenants or other charges in excess of those permitted under this Agreement, the City may demand,
and seek as an additional remedy, the return of such excess rents or other charge to the affected
households.
(d) Action to Compel Performance or for Damages. The City may bring an
action at law or in equity to compel the Borrower’s performance of its obligations under this
Agreement, and/or for damages, or for the appointment of a receiver to take over and operate the
Eight Trees Phase Two Regulatory Agreement Recast 13
Project in accordance with the terms of this Agreement or for such other relief as may be
appropriate.
(e) Remedies Provided Under Loan Agreement. The City may exercise any
other remedy provided under the Loan Agreement.
(f) Remedies Cumulative. The remedies of the City hereunder are cumulative,
and the exercise of one or more of such remedies shall not be deemed an election of remedies and
shall not preclude the exercise by the City of any one or more of its other remedies.
6.9 Attorneys Fees and Costs.
In any action brought to enforce this Agreement, the prevailing party shall be entitled to all
costs and expenses of suit, including reasonable attorneys' fees. This section shall be interpreted
in accordance with California Civil Code Section 1717 and judicial decisions interpreting that
statute.
6.10 Recording and Filing.
The City and the Borrower shall cause this Agreement, and all amendments and
supplements to it, to be recorded in the Official Records of the County of San Mateo.
6.11 Governing Law.
This Agreement shall be governed by the laws of the State of California.
6.12 Waiver of Requirements.
Any of the requirements of this Agreement may be expressly waived by the City in writing,
but no waiver by the City of any requirement of this Agreement shall, or shall be deemed to, extend
to or affect any other provision of this Agreement.
6.13 Amendments.
This Agreement may be amended only by a written instrument executed by all the parties
hereto or their successors in title, and duly recorded in the real property records of the County of
San Mateo.
6.14 Notices.
Any notice requirement set forth herein shall be deemed to be satisfied three (3) days after
mailing of the notice first-class United States certified mail, postage prepaid, addressed to the
appropriate party as follows:
Borrower: MP Willow Greenridge Associates, L.P.
303 Vintage Park Drive, Suite 250
Foster City, California 94404
Attention: Assistant Secretary
With a copy to: Hudson SLP LLC
c/o Hudson Housing Capital LLC
630 Fifth Avenue, 28th Floor
Eight Trees Phase Two Regulatory Agreement Recast 14
New York, New York 10111
Attention: Joseph A. Macari
City: City of South San Francisco
400 Grand Avenue
South San Francisco, CA 94080
Such addresses may be changed by notice to the other party given in the same manner as provided
above.
6.15 Severability.
If any provision of this Agreement shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining portions of this Agreement shall not in any way be
affected or impaired thereby.
6.16 Multiple Originals; Counterparts.
This Agreement may be executed in multiple originals, each of which is deemed to be an
original, and may be signed in counterparts.
6.17. Captions. The captions used in this Agreement are inserted only as a matter of
convenience and for reference and in no way define, limit or describe the scope or the intent of
this Agreement.
6.18. Assignment of City’s Rights. The City retains the right, at its sole discretion, to
assign all or part of its rights under this Agreement for the purpose of ensuring compliance and
enforcement of the Borrower’s duties and obligations hereunder. In addition, the City may
designate an agent to act on its behalf in monitoring compliance and enforcing the provisions
hereof.
6.19. Binding on Successors. This Agreement shall bind, and benefits thereof shall inure
to, the respective parties hereto, their legal representatives, executors, administrators, successors
in interest, and assigns, provided, however, that the Borrower may not assign this Agreement or
any of its obligations hereunder, voluntarily or by operation of law, without the prior written
approval of the City.
6.20. Hold Harmless. Borrower shall indemnify, defend (with counsel approved by the
City), and hold the City and its elected and appointed officers, officials, employees, contractors,
agents, and representatives (all of the foregoing, collectively the “Indemnitees”) harmless from
and against any and all liabilities, losses, damages, fines, deficiencies, penalties, claims, demands,
suits, actions, causes of action, legal or administrative proceedings, judgments, costs and expenses
(including without limitation reasonable attorneys’ fees and court costs) (all of the foregoing,
collectively “Claims”) arising directly or indirectly in any manner in connection with or resulting
from, (a) any failure of any of Borrower’s representations or warranties set forth in this Agreement,
or made by Borrower in connection with the execution and delivery of this Agreement or in any
Eight Trees Phase Two Regulatory Agreement Recast 15
certificate furnished pursuant hereto, to be correct in all material respects; (b) any contract for
services entered into between Borrower and a third party, or services provided to Borrower by a
third party, related to the Project; and (c) any claim, demand or cause of action, or any action or
other proceeding, whether meritorious or not, brought or asserted against any Indemnitee which
relates to or arises in connection with the Agreement or any transaction contemplated thereby.
Borrower’s obligations under this Section shall survive expiration or termination of this
Agreement. Borrower's indemnity obligations shall not apply to Claims arising as a result of the
willful misconduct or gross negligence of the Indemnitees.
6.21. Restrictions on Sale, Encumbrance, and Other Acts.
(a) Except for leases to tenants in the ordinary course of business, the Borrower shall
not make, or allow, any sale, encumbrance, hypothecation, assignment, pledge,
conveyance, or transfer in any form of the Project or of any of its interest therein,
except with the prior written approval of the City or as permitted in the Loan
Agreement. Notwithstanding the previous sentence, the following transfers are
hereby approved by the City: (a) the transfer of the Project to a limited partnership,
the general partner of which is an affiliate of Borrower; (b) the transfer of limited
partnership interests in the Borrower; (c) the removal and replacement of the
general partner for cause in accordance with the terms of the limited partnership
agreement of Borrower; (d) the grant and exercise of an option or right of first
refusal in favor of Borrower’s general partner or an affiliate thereof and (e) a deed
of trust encumbering the Property granted in connection with any other loan
provided for the Project (including but not limited to the construction loan provided
by Capital One, National Association and the permanent financing loan provided
by First Republic Bank).
(b) The City shall approve a sale, transfer or conveyance provided that all of the
following conditions are met:
(1) the Borrower is in compliance with this Agreement and the City
Loan Documents or the sale, transfer or conveyance will result in the cure of any existing violations
of the Agreement or the City Loan Documents;
(2) the successor-in-interest to the Borrower agrees to assume all
obligations of the Borrower pursuant to this Agreement;
(3) any terms of the sale, transfer or conveyance shall not threaten the
City’s security or repayment of the Loan; and
(4) any successor-in-interest demonstrates to the City’s satisfaction that
it has the management and financial capacity to own and operate the Project.
Eight Trees Phase Two Regulatory Agreement Recast 16
IN WITNESS WHEREOF, the City and the Borrower have executed this Agreement by
duly authorized representatives, all on the date first written above.
MP Willow Greenridge Associates, L.P.,
a California limited partnership
By: MP Greenridge LLC,
a California limited liability company,
its general partner
By: Mid-Peninsula Half Moon Bay, Inc.,
a California nonprofit public benefit
corporation, its sole member/manager
By: __________________________
Jan M. Lindenthal
Assistant Secretary
APPROVED AS TO FORM:
By: _____________________________
City Attorney
CITY:
CITY OF SOUTH SAN FRANCISCO, a
municipal corporation
By: ________________________________
Its: ________________________________
“A Notary Public or other officer completing this certificate verifies only the identity of the individual
who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or
validity of that document.”
STATE OF CALIFORNIA )
COUNTY OF SAN MATEO )
On ____________________, before me, ___________________________, Notary Public,
personally appeared , who proved
to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to
the within instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the
person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify UNDER PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature (Seal)
“A Notary Public or other officer completing this certificate verifies only the identity of the individual
who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or
validity of that document.”
STATE OF CALIFORNIA )
COUNTY OF SAN MATEO )
On ____________________, before me, ___________________________, Notary Public,
personally appeared , who proved
to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to
the within instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the
person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify UNDER PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature (Seal)
EXHIBIT A
Legal Description Willow Gardens Property
EXHIBIT B
Legal Description Greenridge Property
EXHIBIT C
Schedule of HOME Assisted Units
Income Limits Number of HOME Assisted
Units
Very Low Income
(“50%” AMI Limits)
(Low HOME Assisted Units)
3
Low Income
(“80%” AMI Limits)
(High HOME Assisted Units)
8
Total HOME Assisted Units 11
3873044.1
Eight Trees Phase Two Regulatory Agreement Recast 1
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
City of South San Francisco
400 Grand Avenue
South San Francisco, CA 94080
No fee for recording pursuant to
Government Code Section 27383
APNs: 011-270-200, 011-264-020, 011-270-360, 011-270-100, 011-270-110, 011-270-120, 011-271-100, 011-270-300, 011-270-
170, 010-440-670
REGULATORY AGREEMENT AND DECLARATION
OF RESTRICTIVE COVENANTS
(Willow Gardens/Greenridge)
This Regulatory Agreement and Declaration of Restrictive Covenants (the "Agreement")
is made and entered into as of [__________] [__], 2021, by and between the City of South San
Francisco, a municipal corporation (the "City") and MP Willow Greenridge Associates, L.P., a
California limited partnership (the "Borrower" or “Owner”).
RECITALS
A. The Borrower owns certain real property located at 986 Nora Way, 982, 986, and
990 Brusco Way, 344, 364, 383 & 395 Susie Way, and 976 Sandra Court, City of South San
Francisco, County of San Mateo, State of California as more particularly described in Exhibit A
attached hereto (the “Willow Gardens Property”), and certain real property located at 1565 El
Camino Real, City of South San Francisco, County of San Mateo, State of California as more
particularly described in Exhibit B attached hereto (the “Greenridge Property” and collectively
with the Willow Gardens Property, the “Property”).
B. The City and the Borrower have entered into an Amended and Restated Loan
Agreement (the “Loan Agreement”) and an Amended and Restated Promissory Note (the “Note”)
concurrently herewith, pursuant to which the City will provide a loan (the "Loan") to the Borrower
to rehabilitate thirty-four (34) apartment units, including one (1) unrestricted manager’s unit,
located on the Greenridge Property and thirty-six (36) apartment units, including one (1)
unrestricted manager’s unit, located on the Willow Gardens Property (the “Project”), as further set
forth and described in the Loan Agreement. The Property is and shall continue to be operated as
affordable rental housing projects for Lower Income Households as defined herein. Capitalized
terms used but not defined in this Agreement shall have the meanings set forth in the Loan
Agreement (as defined below).
C. As a condition of providing the Loan, the City requires the Borrower to execute this
Agreement, which will regulate sixty-eight (68) residential units of the Property as “City Assisted
Units” in accordance with the schedule of units in Exhibit C attached hereto and incorporated
Eight Trees Phase Two Regulatory Agreement Recast 2
herein, to ensure that the units are occupied by and affordable to Lower-Income Households for
the term of this Agreement. The City Assisted Units will be monitored by the City for compliance
with City affordability and related program requirements as set forth herein.
NOW THEREFORE, in consideration of the recitals, hereof, and other mutual covenants
and promises contained herein and for other valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the City and the Borrower hereby agree as follows.
ARTICLE 1
DEFINITIONS
1.1 Definitions
When used in this Agreement, the following terms shall have the respective meanings
assigned to them in this Article 1.
(a) "Adjusted Income" shall mean the total anticipated annual income of all
persons in a household as calculated in accordance with 24 CFR 92.203(b)(l), which incorporates
24 CFR 5.609m
(b) "Agreement" shall mean this Regulatory Agreement and Declaration of
Restrictive Covenants.
(c) “Area Median Income” shall mean the median gross yearly household
income, adjusted for household size for San Mateo County, as published from time to time by
HUD. In the event that such income determinations are no longer published by HUD, or are not
updated for a period of at least eighteen (18) months, the City shall provide the Borrower with
other income determinations which are reasonably similar with respect to methods of calculation
to those previously published by HUD.
(d) “Assumed Household Size” shall mean, solely for the purposes of
establishing maximum rent limits for the City Assisted Units, a household size equal to the
number of bedrooms in the Unit, times one and a half. For example, the Assumed Household
Size for a two-bedroom unit shall be a household of three. Assumed Household Size is not
intended to be used as a maximum occupancy limit for the Units.
(e) "Borrower" shall mean MP Willow Greenridge Associates, L.P., a
California limited partnership and its successors and assigns to the Project.
(e) "City" shall mean the City of South San Francisco, a municipal corporation.
(f) "City Assisted Units" shall mean the sixty-eight (68) dwelling units within
the Project, the rehabilitation of which will be assisted with funds provided by the Loan.
Eight Trees Phase Two Regulatory Agreement Recast 3
(g) "Deed of Trust" shall mean the deed of trust for the benefit of the City on
the Property which secures repayment of the Loan and the performance of the Loan Agreement
and this Agreement.
(h) “Greenridge Property” shall have the meaning set forth in Recital A.
(i) “Household Size” shall mean the actual number of persons in the applicant
or Tenant household.
(j) “HUD” means the United States Department of Housing & Urban
Development.
(k) “Loan” shall mean all funds loaned to the Borrower by the City pursuant to
the Loan Agreement.
(j) "Loan Agreement" shall mean the Amended and Restated Loan Agreement
entered into by and between the City and the Borrower, dated concurrently herewith.
(k) “Low-Income Household” or “Lower-Income Household” shall mean a
household whose Adjusted Income does not exceed eighty percent (80%) of the Area Median
Income.
(l) "Low Income Rent" shall mean the maximum allowable rent for a Low-
Income Household pursuant to Section 2.2(a) below.
(n) “Multifamily Tax Subsidy Program” (MTSP) shall mean the Low Income
Housing Tax Credit program promulgated under Section 42 of the Internal Revenue Code.
(o) "Note" shall mean the City Note from the Borrower to the City, as defined
in the Loan Agreement, evidencing all or any part of the Loan.
(p) "Project" shall have the meaning set forth in Recital B above and as further
described in the Loan Agreement.
(q) "Property" shall mean the real property described in Exhibits A and B
attached hereto and incorporated herein.
(r) "Rent" shall mean the total of monthly payments by the Tenant of a City
Assisted Unit for the following: use and occupancy of the Unit and land and associated facilities,
including parking; any separately charged fees or service charges assessed by the Borrower which
are required of all Tenants, other than security deposits; an allowance for the cost of an adequate
level of service for utilities paid by the Tenant, including electricity, gas and other heating, cooking
and refrigeration fuel, but not telephone service or cable TV; and any other interest, taxes, fees or
charges for use of the land or associated facilities and assessed by a public or private entity other
than the Borrower, and paid by the Tenant.
Eight Trees Phase Two Regulatory Agreement Recast 4
(s) "60% AMI Household" shall mean a household with an Adjusted Income,
adjusted for household size, that does not exceed 60% of Area Median Income.
(t) "60% AMI Rent" shall mean the maximum allowable rent for a 60% AMI
Household pursuant to Section 2.2(b) below.
(u) "Tenant" shall mean a household lawfully occupying a Unit subject to a
valid lease.
(v) "Term" shall mean the term of this Agreement, which shall commence on
the date of this Agreement and shall continue until the earlier of the fifty-fifth (55th) anniversary
date of completion of the rehabilitation scope of work, as evidenced by a Temporary Certificate of
Occupancy or equivalent, or a specified later date in the event the City and Borrower agree to
extend such term.
(w) "Unit" for leasing and management purposes, shall mean one of the sixty-
eight (68) apartments in the Property, and does not include the manager’s units. The Units,
pursuant to Section 2.1 below, are required to be occupied by, or if vacant available for occupancy
by Low, 60% AMI, and Very Low Income Households.
(x) "Very Low Income Household" shall mean a household with an Adjusted
Income, adjusted for household size, that does not exceed 50% of Area Median Income.
(y) "Very Low Income Rent" shall mean the maximum allowable rent for a
Very Low Income Household pursuant to Section 2.2(c) below.
(z) “Willow Gardens Property” shall have the meaning set forth in Recital A.
ARTICLE 2
AFFORDABILITY AND OCCUPANCY COVENANTS
2.1 Occupancy Requirements.
(a) City Assisted Units. Thirty five (35) of the City Assisted Units shall be
rented to and occupied by or, if vacant, available for occupancy by Low Income Households,
seventeen (17) of the City Assisted Units shall be rented to and occupied by or, if vacant, available
for occupancy by 60% AMI Households, and sixteen (16) of the City Assisted Units shall be rented
to and occupied by or, if vacant, available for occupancy by Very Low Income Households in
accordance with Exhibit C. The foregoing requirements shall not preclude the Borrower from
complying with more restrictive income and/or rent limits that may apply to one or more of the
sixty eight (68) City Assisted Units during the term of any other regulatory agreement recorded
against the Property currently, or subsequently to be recorded, with prior City approval, for the
purposes of ensuring the affordability of the units and/or establishing deeper affordability targeting
Eight Trees Phase Two Regulatory Agreement Recast 5
requirements. Notwithstanding anything to the contrary contained herein, the City acknowledges
that as of the date of this Agreement one of the City Assisted Units is currently occupied by a
household that exceeds the Low Income Household maximum income, and City hereby agrees that
such household shall not be deemed out of compliance with this Agreement, provided that, upon
turnover, Borrower shall rent such unit to a qualified Tenant in accordance with this Agreement.
2.2 Allowable Rent
(a) Low Income Rent. Rents (including utility allowance) charged to Tenants
of the Low Income Household City Assisted Units shall not exceed the 80% AMI rent limit
published annually by HUD. In the event that HUD no longer publishes the Rent Limits, the rents
for Low Income Household Units shall not exceed one-twelfth (1/12) of thirty percent (30%) of
eighty percent (80%) of Area Median Income for the Assumed Household Size, as further set forth
in Exhibit C.
(b) 60% AMI Rent. Rents (including utility allowance) charged to Tenants of
the 60% AMI Household City Assisted Units shall not exceed the 60% AMI rent limit published
annually by HUD. In the event that HUD no longer publishes the Rent Limits, the rents for
Low Income Units shall not exceed one-twelfth (1/12) of thirty percent (30%) of sixty percent
(60%) of Area Median Income for the Assumed Household Size, as further set forth in Exhibit
C.
(c) Very Low Income Rent. Rents (including utility allowance) charged to
Tenants of the Very Low Income Household City Assisted Units shall not exceed the 50% AMI
rent limit published annually by HUD. In the event that HUD no longer publishes the Rent
Limits, the rents for Very Low Income Household Units shall not exceed one-twelfth (1/12) of
thirty percent (30%) of fifty percent (50%) of Area Median Income for the Assumed Household
Size, as further set forth in Exhibit C.
(d) Housing Assistance Payment Contracts; Project Based Vouchers. In the
event that some or all of the City Assisted Units are subject to a valid Housing Assistance Payment
(“HAP”) contract with HUD and/or the San Mateo County Housing Authority (including a HAP
contract in connection with tenant-based Housing Choice Vouchers), the allowable Rent may be
determined by the parties to the HAP contract and may exceed the allowable Rent set forth above.
Borrower shall provide notice to City that a HAP contract has been executed, and such notice shall
identify which units will be subject to the HAP contract, and the term of HAP contract applicable
to each unit. Executed HAP contract(s) shall be made available for City inspection upon request.
Under applicable federal law, prior to the expiration of any HAP assistance, Borrower shall notify
Tenant that their Rent may be increased to the applicable allowable Rent limit specified herein.
(e) Hold Harmless. Notwithstanding anything to the contrary contained
herein, with respect to the Area Median Income determination under this Agreement, the City
shall allow Borrower to apply the same “hold harmless” policy implemented by the California
Tax Credit Allocation Committee in the event that the Area Median Income decreases in any
given calendar year.
Eight Trees Phase Two Regulatory Agreement Recast 6
2.3 Increased Income of Tenants
(a) Non-Qualifying Households in City Assisted Units. If, upon recertification
of the income of a Tenant of a City Assisted Unit, the Borrower determines that
(i) A former Very Low Income Household’s Adjusted Income has
increased and exceeds the income limit for an Very Low Income Household as
defined above, upon sixty (60) days’ written notice to Tenant, such Tenant’s rent
may be increased to the 60% AMI Rent or Low Income Rent (as applicable based
on Adjusted Income), and the next available 60% AMI Unit or Low Income Unit
(as applicable) may be rented to a Very Low Income Household in compliance
with Exhibit C.
AND/OR
(ii) A former 60% AMI Household’s Adjusted Income has increased
and exceeds the income limit for a 60% AMI Household as defined above, such
Tenant’s rent may be increased to the Low Income Rent Limit, upon sixty (60)
days’ written notice to Tenant, and the next available Low Income Unit may be
rented to a 60% AMI Household in compliance with Exhibit C.
AND/OR
(iii) A former Low Income Household’s Adjusted Income has increased
and exceeds the income limit for a Low Income Household as defined above, upon
sixty (60) days’ written notice to Tenant, such Tenant’s rent may be increased to
30% of the Tenant’s actual monthly household income or to a comparable rent for
Low Income Households occupying units of comparable size. If such an increase
is expressly prohibited under a deed restriction of a lienholder senior to the City
lien, or federal IRS tax credit regulations applicable to the Property at the time, the
rent shall remain at the then-current Low Income Rent Limit, and the number of
Low Income Units occupied by Tenants with incomes over the Low Income Rent
limit shall be reported to the City on an annual basis in Borrower’s annual reports
to the City as required under Section 3.2 herein.
(b) Over Income Households. Notwithstanding anything to the contrary
contained herein, if any household’s income has been determined to be at or above 120%
Area Median Income for two consecutive annual income certifications, Borrower may
terminate such tenant’s lease with a six (6) month notice to vacate.
(c) Termination of Occupancy. Upon termination of occupancy of a City
Assisted Unit by a Tenant, such City Assisted Unit shall be deemed to be continuously
occupied by a household of the same income level (e.g., Very Low Income Household) as
the initial income level of the vacating Tenant if such Unit is reoccupied by a household of
Eight Trees Phase Two Regulatory Agreement Recast 7
the same income level within 120 days of vacancy of the Unit by the prior Tenant, at which
time the status of the Unit shall be determined based on the income level of the new Tenant.
2.4 Notwithstanding anything to the contrary contained herein, for so long as the
Property is subject to the requirements of the Multifamily Tax Subsidy Program, the applicable
TCAC/MTSP requirements related to rent and income limits shall apply in lieu of the restrictions
set forth herein with respect to rent and income limits.
2.5 Persons residing on the Property as of the date of this Agreement shall not be
displaced before suitable replacement housing is available in comparable replacement housing.
Owner shall ensure that all occupants of the Property receive all notices, benefits and assistance to
which they are entitled in accordance with California Relocation Assistance Law (Government
Code Section 7260 et seq.), all state and local regulations implementing such law, and all other
applicable local, state and federal laws and regulations (collectively "Relocation Laws") relating
to the displacement and relocation of eligible persons as defined in such Relocation Laws.
Any and all costs incurred in connection with the temporary and/or permanent
displacement and/or relocation of occupants of the Property, including without limitation
payments to a relocation consultant, moving expenses, and payments for temporary and permanent
relocation benefits pursuant to Relocation Laws shall be paid by Owner. Owner shall indemnify,
defend (with counsel approved by City) and hold harmless the Indemnitees as defined in Section
6.20 from and against any and all Claims as defined in Section 6.20 arising in connection with the
breach of Owner's obligations set forth in this Section except to the extent such Claims arise from
the gross negligence or willful misconduct of the Indemnitees. Owner's indemnification
obligations set forth in this Section 2.5 shall survive the expiration or earlier termination of this
Agreement.
2.6 Occupancy Procedures. The Borrower shall adopt written tenant selection
policies and criteria for the Units that:
(a) Are consistent with the purpose of providing housing for Low-Income
Households;
(b) Are reasonably related to program eligibility and the applicants’ ability to
perform the obligations of the lease; and
(c) Provide for:
(i) The selection of tenants from a written waiting list in the
chronological order of their application, applying the local
preference as outlined in this Agreement, insofar as is practicable
and compliant with applicable laws and regulations; and
(ii) The prompt written notification to any rejected applicant of the
grounds for any rejection.
2.7 Security Deposits. Any security deposits collected by the
Borrower or Borrower’s agent shall be kept separate and apart from all other funds of the Property
in a trust account with a depository insured by the Federal Deposit Insurance Corporation, or other
comparable federal deposit insurance program, and shall be held and disbursed in accordance with
Eight Trees Phase Two Regulatory Agreement Recast 8
California law. If required by the locality, the balance of such amount shall at all times equal or
exceed the aggregate of all outstanding obligations under said account, plus accrued interest
thereon.
ARTICLE 3
INCOME CERTIFICATION AND REPORTING
3.1 Income Certification.
The Borrower will obtain, complete and maintain on file, immediately prior to initial
occupancy and annually thereafter, income certifications from each Tenant renting any of the
Units. The Borrower shall make a good faith effort to verify that the income provided by an
applicant or occupying household in an income certification is accurate by taking two or more of
the following steps as a part of the verification process: (a) obtain a pay stub for the most recent
pay period; (b) obtain an income tax return for the most recent tax year; (c) conduct a credit agency
or similar search; (d) obtain an income verification form from the applicant's current employer; (e)
obtain an income verification form from the Social Security Administration and/or the California
Department of Social Services if the applicant receives assistance from either of such agencies; or
(f) if the applicant is unemployed and has no such tax return, obtain another form of independent
verification. Copies of Tenant income certifications shall be available to the City upon request.
Initial household income certification shall be consistent with the "Part 5 Method" described
in 24 CFR 5.609.
In the event that annual recertification of Tenant incomes indicates that the number of City
Assisted Units actually occupied by Low, 60%, or Very Low Income Households, as applicable,
falls below the number reserved for each income group as specified in Exhibit C attached hereto,
Borrower shall rectify the condition by renting the next available dwelling unit(s) in the Project to
a Low, 60%, or Very Low Income Household(s), as applicable, until the required income mix is
achieved.
3.2. Annual Report to the City.
The Borrower shall file with the City an annual report, no later than 120 days following the end
of each calendar year. The report shall contain a certification by the Borrower as to such
information as the City may then require including, but not limited to, the following:
(a) The substantial physical defects in the Property, including a description of
any major repair or maintenance work undertaken or needed in the
previous and current fiscal years. Such statement shall describe what steps
the Borrower has taken in order to maintain the Property in a safe and
sanitary condition in accordance with applicable housing and building
codes.
(b) The occupancy of the Property including:
(1) the verified income of each current household; and
(2) the current rent charged each household and whether these rents
include utilities.
(c) A summary of the information received from the recertification of
Tenants’ incomes.
Eight Trees Phase Two Regulatory Agreement Recast 9
(d) Other information reasonably required by the City, including the fiscal
condition of the Borrower showing a financial statement for the previous
fiscal year that includes a balance sheet and a profit and loss statement
indicating any surplus or deficit in operating accounts; a detailed, itemized
listing of income and expenses; the amount of any fiscal reserves and the
total amount of Residual Receipts (as defined in the Note) received. Such
financial statement shall be prepared in accordance with the requirements
of the City. The City may require that the financial statement be audited
at the Borrower’s expense by an independent certified public accountant
acceptable to the City, or other person designated by the City, if City
reasonably determines that audit is deficient.
3.3 Additional Information.
The Borrower shall provide any additional information reasonably requested by the City
to the City. The City shall have the right to examine and make copies of all books, records or other
documents of the Borrower which pertain to the Project.
3.4 Records.
The Borrower shall maintain complete, accurate and current records pertaining to the
Project, and shall permit any duly authorized representative of the City to inspect records,
including records pertaining to income of Tenants. All Tenant lists, applications and waiting lists
relating to the Project shall at all times be kept separate and identifiable from any other business
of the Borrower and shall be maintained as required by the City, in a reasonable condition for
proper audit and subject to examination during business hours by representatives of the City. The
Borrower shall retain copies of all materials obtained or produced with respect to occupancy of the
Units for a period of at least five (5) years.
3.5 On-site Inspection.
The City shall each have the right to perform an on-site inspection of the Project at least
one time per year with adequate notice to Borrower, a minimum of thirty (30) days. The Borrower
agrees to cooperate in such inspection.
ARTICLE 4
OPERATION OF THE PROJECT
4.1 Use of the Project.
The Property shall be operated as affordable rental housing consisting of sixty-eight (68)
Units, plus one unrestricted unit for an on-site property manager at each of the Willow Gardens
Property and the Greenridge Property.
4.2 Compliance with Loan Agreement.
Borrower shall comply with all the terms and provisions of the Loan Agreement, and the
Deed of Trust for the Project.
Eight Trees Phase Two Regulatory Agreement Recast 10
4.3 Taxes and Assessments.
Borrower shall pay all real and personal property taxes, assessments and charges and all
franchise, income, employment, old age benefit, withholding, sales, and other taxes assessed
against it, or payable by it, at such times and in such manner as to prevent any penalty from
accruing, or any line or charge from attaching to the Property; provided, however, that Borrower
shall have the right to contest in good faith, any such taxes, assessments, or charges. In the event
Borrower exercises its right to contest any tax, assessment, or charge against it, Borrower, on final
determination of the proceeding or contest, shall immediately pay or discharge any decision or
judgment rendered against it, together with all costs, charges and interest.
ARTICLE 5
PROPERTY MANAGEMENT AND MAINTENANCE
5.1 Management Responsibilities.
The Borrower is responsible for all management functions with respect to the Project,
including without limitation the selection of tenants, certification and recertification of household
size and income, evictions, collection of rents and deposits, maintenance, landscaping, routine and
extraordinary repairs, replacement of capital items, and security. The City shall have no
responsibility over management of the Project. The Borrower shall retain a professional property
management company approved by the City in its reasonable discretion to perform its management
duties hereunder, unless the City approves self-management by the Borrower. A resident manager
shall also be required.
(a) Accounting Records. In a manner subject to City approval, the Borrower
shall maintain, on an accrual or modified accrual basis, a general ledger accounting system that is
posted monthly and that accurately and fully shows all assets, liabilities, income and expenses of
the Project. All records and books relating to this system shall be kept for a period of at least seven
years and in such a manner as to ensure that the records are reasonably protected from destruction
or tampering. All records shall be subject to City inspection and audit.
(b) Use of Income from Operations. The Borrower, or its management agent,
shall promptly deposit all operating income in a segregated account established exclusively for the
Project with an FDIC or other comparable federally-insured financial institution.
5.2 Management Agent; Periodic Reports.
Unless the City approves self-management by the Borrower, the Project shall at all times
be managed by an experienced management agent reasonably acceptable to the City, with
demonstrated ability to operate residential facilities like the Project in a manner that will provide
decent, safe, and sanitary housing (as approved, the "Management Agent"). The Borrower shall
submit for the City's approval the identity of any proposed Management Agent. The Borrower
shall also submit such additional information about the background, experience and financial
condition of any proposed Management Agent as is reasonably necessary for the City to determine
whether the proposed Management Agent meets the standard for a qualified Management Agent
set forth above. If the proposed Management Agent meets the standard for a qualified
Management Agent set forth above, the City shall approve the proposed Management Agent by
Eight Trees Phase Two Regulatory Agreement Recast 11
notifying the Borrower in writing. Unless the proposed Management Agent is disapproved by the
City within thirty (30) days, which disapproval shall state with reasonable specificity the basis for
disapproval, it shall be deemed approved. The City hereby approves MidPen Property
Management Corporation as the Management Agent.
5.3 Performance Review.
The City reserves the right to conduct an annual (or more frequently, if deemed necessary
by the City) review of the management practices and financial status of the Project. The purpose
of each periodic review will be to enable the City to determine if the Project is being operated and
managed in accordance with the requirements and standards of this Agreement. The Borrower
shall cooperate with the City in such reviews.
5.4 Replacement of Management Agent.
If, as a result of a periodic review, the City determines in its reasonable judgment that the
Project is not being operated and managed in accordance with any of the material requirements
and standards of this Agreement, the City shall deliver notice to Borrower of its intention to cause
replacement of the Management Agent, or, if the Project is being self-managed, to cause the
Borrower to retain a Management Agent, including the reasons therefor. Within fifteen (15) days
of receipt by Borrower of such written notice, City staff, as applicable, and the Borrower shall
meet in good faith to consider methods for improving the financial and operating status of the
Project, including, without limitation, replacement of the Management Agent.
If, after such meeting, City staff, as applicable, recommends in writing the replacement of
the Management Agent, Borrower shall promptly dismiss the then Management Agent, or cease
self-management if the Project is self-managed and shall appoint as the Management Agent a
person or entity meeting the standards for a Management Agent set forth in Section 5.2 above and
approved by the City pursuant to Section 5.2 above.
Any contract for the operation or management of the Project entered into by Borrower shall
provide that the contract can be terminated as set forth above, or terminated without cause upon
thirty (30) days’ notice. Failure to remove the Management Agent or to appoint a Management
Agent instead of self-management in accordance with the provisions of this Section shall constitute
default under this Agreement, and the City may enforce this provision through legal proceedings
as specified in Section 6.8.
5.5 Approval of Management Policies.
The Borrower shall submit its written management policies with respect to the Project to
the City for its review, and shall amend such policies in any way necessary to ensure that such
policies comply with the provisions of this Agreement.
5.6 Property Maintenance.
The Borrower agrees, for the entire Term of this Agreement, to maintain all interior and
exterior improvements, including landscaping, on the Property in good condition and repair (and,
as to landscaping, in a healthy condition), reasonable wear and tear excepted, and in accordance
with all applicable laws, rules, ordinances, orders and regulations of all federal, state, City,
municipal, and other governmental agencies and bodies having or claiming jurisdiction and all
Eight Trees Phase Two Regulatory Agreement Recast 12
their respective departments, bureaus, and officials. The Borrower shall make all repairs and
replacements necessary to keep the improvements in good condition and repair. Owner shall
prevent and/or rectify any physical deterioration of the Property and the Project and shall make all
repairs, renewals and replacements necessary to keep the Property and the improvements located
thereon in good condition and repair.
5.7 City Right to Perform Maintenance. In the event that Owner breaches any of the
covenants contained in Section 5.6, and such default continues for a period of ten (10) days after
written notice from City (with respect to graffiti, debris, and waste material) or thirty (30) days
after written notice from City (with respect to landscaping, building improvements and general
maintenance), then City, in addition to any other remedy it may have under this Agreement or at
law or in equity, shall have the right, but not the obligation, to enter upon the Property and perform
all acts and work necessary to protect, maintain, and preserve the improvements and the landscaped
areas on the Property. All costs expended by City in connection with the foregoing, shall constitute
an indebtedness secured by the Deed of Trust, and shall be paid by Owner to City upon demand.
Notwithstanding anything to the contrary set forth in this Section, City agrees that it will provide
Owner with not less than thirty (30) days' written notice prior to undertaking any work for which
Owner will incur a financial obligation.
ARTICLE 6
MISCELLANEOUS
6.1 Lease Provisions.
The Borrower shall use a form of Tenant lease approved by the City for City Assisted
Units. The form of Tenant lease shall also comply with all requirements of this Agreement and
shall include the following provisions for the City Assisted Units:
(a) provide for termination of the lease and consent by the Tenant to immediate
eviction for failure: (1) to provide any information required under this Agreement or reasonably
requested by the Borrower to establish or recertify the Tenant's qualification, or the qualification
of the Tenant's, for occupancy in the Project in accordance with the standards set forth in this
Agreement, or (2) to qualify as a Low, 60%, or Very Low Income Household, as a result of any
material misrepresentation made by such Tenant with respect to the income computation or
certification.
(b) be for an initial term of not less than one (1) year, and provide for no Rent
increase during such period. After the initial lease term, such lease may be month to month by
mutual agreement of the Borrower and the Tenant; however the Rent may not be raised more often
than once a year. The Borrower will provide each Tenant at least sixty (60) days' written notice of
any increase in Rent applicable to such Tenant, and with such further notice as may be required by
Section 2.3 above.
(c) provide that any termination of a lease or refusal by the Borrower to renew
a lease, with the exception of evictions or non-renewals for non-payment of rent, must be preceded
Eight Trees Phase Two Regulatory Agreement Recast 13
by no less than thirty (30) days written notice to the Tenant by the Borrower specifying the grounds
for the action.
In addition, Tenant leases may not contain the following prohibitive clauses:
(1) Agreement by the tenant to be sued.
(2) Statement that owner can confiscate tenant property.
(3) Statement excusing owner from legal responsibility.
(4) Statement that owner does not have to give notice when
instituting a lawsuit.
(5) Agreement by the tenant to waive rights to a jury trial.
(6) Agreement by the tenant to waive rights to appeal a court
decision.
(7) Agreement by the tenant to pay attorneys’ fees if the tenant
wins a court case.
(8) Agreement by the tenant to waive rights to civil court
proceeding to defend eviction.
6.2 Nondiscrimination.
The Borrower shall not give preference to any particular class or group of persons in renting or
selling the Units, or any part of the Project except to the extent that the Units are required to be
leased to Low, 60% or Very Low Income Households. Borrower shall not restrict the rental, sale,
lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property or Project, or any
portion thereof, on the basis of race, color, religion, sex, gender, gender identity, gender
expression, sexual orientation, marital status, national origin, ancestry, familial status, source of
income, disability, or genetic information of any person. Borrower covenants for itself and all
persons claiming under or through it, and this Agreement is made and accepted upon and subject
to the condition that there shall be no discrimination against or segregation of any person or
group of persons on account of any basis listed in subdivision (a) or (d) of Section 12955 of the
Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and
paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code,
in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property, Project
or part thereof, nor shall Borrower or any person claiming under or through Borrower establish
or permit any such practice or practices of discrimination or segregation with reference to the
selection, location, number, use or occupancy of tenants, lessees, subtenants, sub lessees or
vendees in, of, or for the Property, Project or part thereof.
All deeds made or entered into by Borrower, its successors or assigns, as to any portion
of the Property or Project shall contain the following language, and all leases or contracts made
or entered into by Borrower, its successors or assigns, as to any portion of the Property or
Project, shall reference this Section, and shall enforce the same diligently and in good faith:
“(a) Borrower herein covenants by and for itself, its successors and assigns, and
all persons claiming under or through it, that there shall be no discrimination
Eight Trees Phase Two Regulatory Agreement Recast 14
against or segregation of a person or of a group of persons on account of any basis
listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those
bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1)
of subdivision (p) of Section 12955, and Section 12955.2 of the Government
Code, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of
the property herein conveyed nor shall the Borrower or any person claiming under
or through the Borrower establish or permit any such practice or practices of
discrimination or segregation with reference to the selection, location, number,
use or occupancy of tenants, lessees, subtenants, sub lessees or vendees in the
property herein conveyed. The foregoing covenant shall run with the land.
“(b) Notwithstanding paragraph (a), with respect to familial status, paragraph (a)
shall not be construed to apply to housing for older persons, as defined in Section
12955.9 of the Government Code. With respect to familial status, nothing in
paragraph (1) shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, and
799.5 of the Civil Code, relating to housing for senior citizens. Subdivision (d) of
Section 51 of the Civil Code and subdivisions (d) of Section 12955 of the
Government Code shall apply to paragraph (a).”
Nothing herein shall be construed or interpreted as prohibiting or preventing preferences
or set asides for the units as established in loan agreements; regulatory agreements, etc., so long
as such preferences or set asides comply with applicable local, state, and federal laws.
6.3 Section 8 Certificate Holders.
The Borrower will accept as Tenants, on the same basis as all other prospective Tenants,
persons who are recipients of federal certificates for rent subsidies pursuant to the existing housing
program under Section 8 of the United States Housing Act, or its successor. The Borrower shall
not apply selection criteria to Section 8 certificate or voucher holders that are more burdensome
than criteria applied to all other prospective Tenants, nor shall the Borrower apply or permit the
application of management policies or lease provisions with respect to the Project which have the
effect of precluding occupancy of Units by such prospective Tenants.
6.4 Term.
The provisions of this Agreement shall apply to the Property for the entire Term even if
the Loan is paid in full prior to the end of the Term. This Agreement shall bind any successor,
heir or assign of the Borrower, whether a change in interest occurs voluntarily or involuntarily, by
operation of law or otherwise, except as expressly released by the City. The City makes the Loan
on the condition, and in consideration of, this provision, and would not do so otherwise.
6.5 Compliance with Loan Agreements and Program Requirements.
Borrower's actions with respect to the Project and the use of funds provided herein shall at
all times be in full conformity with all requirements of the Loan Agreement.
6.6 Notice of Expiration of Term.
At least six (6) months prior to the expiration of the Term, the Borrower shall provide by
first-class mail, postage prepaid, a notice to all Tenants in City Assisted Units containing (a) the
anticipated date of the expiration of the Term, (b) any anticipated Rent increase upon the expiration
Eight Trees Phase Two Regulatory Agreement Recast 15
of the Term, (c) a statement that a copy of such notice will be sent to the City, and (d) a statement
that a public hearing may be held by the City on the issue and that the Tenant will receive notice
of the hearing at least fifteen (15) days in advance of any such hearing. The Borrower shall also
file a copy of the above-described notice with the Housing Officer of the City.
6.7 Covenants to Run With the Land.
The City and the Borrower hereby declare their express intent that the covenants and
restrictions set forth in this Agreement shall run with the land, and shall bind all successors in title
to the Property, provided, however, that on the expiration of the Term of this Agreement said
covenants and restrictions shall expire. Each and every contract, deed or other instrument hereafter
executed covering or conveying the Property or any portion thereof, shall be held conclusively to
have been executed, delivered and accepted subject to such covenants and restrictions, regardless
of whether such covenants or restrictions are set forth in such contract, deed or other instrument,
unless the City expressly releases such conveyed portion of the Property from the requirements of
this Agreement.
6.8 Enforcement by the City.
If the Borrower fails to perform any obligation under this Agreement, and fails to cure the
default within thirty (30) days after the City has notified the Borrower in writing of the default or,
if the default cannot be cured within thirty (30) days, fails to commence to cure within thirty (30)
days and thereafter diligently pursue such cure and complete such cure within ninety (90) days,
the City shall have the right to enforce this Agreement by any or all of the following actions, or
any other remedy provided by law:
(a) Calling the Loan. The City may declare a default under the Note, accelerate
the indebtedness evidenced by the Note, including outstanding principal and interest, and demand
immediate repayment thereof. Upon failure to repay such accelerated amount in full, the City may
proceed with a foreclosure in accordance with the provisions of the Deed of Trust and State law
regarding foreclosures.
(b) Collect Rents. Collect all rents and income in connection with the operation
of the Project and use the same and the reserve funds for the operation and maintenance of the
Project.
(c) Excess Rents. In the event that the breach or violation involves the rents to
tenants or other charges in excess of those permitted under this Agreement, the City may demand,
and seek as an additional remedy, the return of such excess rents or other charge to the affected
households.
(d) Action to Compel Performance or for Damages. The City may bring an
action at law or in equity to compel the Borrower’s performance of its obligations under this
Agreement, and/or for damages, or for the appointment of a receiver to take over and operate the
Project in accordance with the terms of this Agreement or for such other relief as may be
appropriate.
Eight Trees Phase Two Regulatory Agreement Recast 16
(e) Remedies Provided Under Loan Agreement. The City may exercise any
other remedy provided under the Loan Agreement.
(f) Remedies Cumulative. The remedies of the City hereunder are cumulative,
and the exercise of one or more of such remedies shall not be deemed an election of remedies and
shall not preclude the exercise by the City of any one or more of its other remedies.
6.9 Attorneys Fees and Costs.
In any action brought to enforce this Agreement, the prevailing party shall be entitled to all
costs and expenses of suit, including reasonable attorneys' fees. This section shall be interpreted
in accordance with California Civil Code Section 1717 and judicial decisions interpreting that
statute.
6.10 Recording and Filing.
The City and the Borrower shall cause this Agreement, and all amendments and
supplements to it, to be recorded in the Official Records of the County of San Mateo.
6.11 Governing Law.
This Agreement shall be governed by the laws of the State of California.
6.12 Waiver of Requirements.
Any of the requirements of this Agreement may be expressly waived by the City in writing,
but no waiver by the City of any requirement of this Agreement shall, or shall be deemed to, extend
to or affect any other provision of this Agreement.
6.13 Amendments.
This Agreement may be amended only by a written instrument executed by all the parties
hereto or their successors in title, and duly recorded in the real property records of the County of
San Mateo.
6.14 Notices.
Any notice requirement set forth herein shall be deemed to be satisfied three (3) days after
mailing of the notice first-class United States certified mail, postage prepaid, addressed to the
appropriate party as follows:
Borrower: MP Willow Greenridge Associates, L.P.
303 Vintage Park Drive, Suite 250
Foster City, California 94404
Attention: Assistant Secretary
With a copy to: Hudson SLP LLC
c/o Hudson Housing Capital LLC
630 Fifth Avenue, 28th Floor
New York, New York 10111
Attention: Joseph A. Macari
Eight Trees Phase Two Regulatory Agreement Recast 17
City: City of South San Francisco
400 Grand Avenue
South San Francisco, CA 94080
Such addresses may be changed by notice to the other party given in the same manner as provided
above.
6.15 Severability.
If any provision of this Agreement shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining portions of this Agreement shall not in any way be
affected or impaired thereby.
6.16 Multiple Originals; Counterparts.
This Agreement may be executed in multiple originals, each of which is deemed to be an
original, and may be signed in counterparts.
6.17. Captions. The captions used in this Agreement are inserted only as a matter of
convenience and for reference and in no way define, limit or describe the scope or the intent of
this Agreement.
6.18. Assignment of City’s Rights. The City retains the right, at its sole discretion, to
assign all or part of its rights under this Agreement for the purpose of ensuring compliance and
enforcement of the Borrower’s duties and obligations hereunder. In addition, the City may
designate an agent to act on its behalf in monitoring compliance and enforcing the provisions
hereof.
6.19. Binding on Successors. This Agreement shall bind, and benefits thereof shall inure
to, the respective parties hereto, their legal representatives, executors, administrators, successors
in interest, and assigns, provided, however, that the Borrower may not assign this Agreement or
any of its obligations hereunder, voluntarily or by operation of law, without the prior written
approval of the City.
6.20. Hold Harmless. Borrower shall indemnify, defend (with counsel approved by the
City), and hold the City and its elected and appointed officers, officials, employees, contractors,
agents, and representatives (all of the foregoing, collectively the “Indemnitees”) harmless from
and against any and all liabilities, losses, damages, fines, deficiencies, penalties, claims, demands,
suits, actions, causes of action, legal or administrative proceedings, judgments, costs and expenses
(including without limitation reasonable attorneys’ fees and court costs) (all of the foregoing,
collectively “Claims”) arising directly or indirectly in any manner in connection with or resulting
from, (a) any failure of any of Borrower’s representations or warranties set forth in this Agreement,
or made by Borrower in connection with the execution and delivery of this Agreement or in any
certificate furnished pursuant hereto, to be correct in all material respects; (b) any contract for
services entered into between Borrower and a third party, or services provided to Borrower by a
third party, related to the Project; and (c) any claim, demand or cause of action, or any action or
Eight Trees Phase Two Regulatory Agreement Recast 18
other proceeding, whether meritorious or not, brought or asserted against any Indemnitee which
relates to or arises in connection with the Agreement or any transaction contemplated thereby.
Borrower’s obligations under this Section shall survive expiration or termination of this
Agreement. Borrower's indemnity obligations shall not apply to Claims arising solely as a result
of the willful misconduct or gross negligence of the Indemnitees.
6.21. Restrictions on Sale, Encumbrance, and Other Acts.
(a) Except for leases to tenants in the ordinary course of business, the Borrower shall
not make, or allow, any sale, encumbrance, hypothecation, assignment, pledge,
conveyance, or transfer in any form of the Project or of any of its interest therein,
except with the prior written approval of the City or as permitted in the Loan
Agreement. Notwithstanding the previous sentence, the following transfers are
hereby approved by the City: (a) the transfer of the Project to a limited partnership,
the general partner of which is an affiliate of Borrower; (b) the transfer of limited
partnership interests in the Borrower; (c) the removal and replacement of the
general partner for cause in accordance with the terms of the limited partnership
agreement of Borrower; (d) the grant and exercise of an option or right of first
refusal in favor of Borrower’s general partner or an affiliate thereof and (e) a deed
of trust encumbering the Property granted in connection with any other loan
provided for the Project (including but not limited to the construction loan provided
by Capital One, National Association and the permanent financing loan provided
by First Republic Bank).
(b) The City shall approve a sale, transfer or conveyance provided that all of the
following conditions are met:
(1) the Borrower is in compliance with this Agreement and the City
Loan Documents or the sale, transfer or conveyance will result in the cure of any existing violations
of the Agreement or the City Loan Documents;
(2) the successor-in-interest to the Borrower agrees to assume all
obligations of the Borrower pursuant to this Agreement;
(3) any terms of the sale, transfer or conveyance shall not threaten the
City’s security or repayment of the Loan;
(4) any successor-in-interest demonstrates to the City’s satisfaction that
it has the management and financial capacity to own and operate the Project; and
(5) Owner uses its best efforts to ensure that all deeds of trust or other
security instruments recorded after the date of this Agreement against the Property, the Project or
part thereof for the benefit of a lender other than City ("Third Party Lender") shall contain each of
the following provisions: (i) Third-Party Lender shall use its best efforts to provide to City a copy
of any notice of default issued to Owner concurrently with provision of such notice to Owner; (ii)
Eight Trees Phase Two Regulatory Agreement Recast 19
City shall have the reasonable right, but not the obligation, to cure any default by Participant within
the same period of time provided to Owner for such cure extended by an additional 90 days; (iii)
provided that City has cured any default under Third-Party Lender's deed of trust and other loan
documents, City shall have the right to foreclose City's Deed of Trust and take title to the Project
without acceleration of Third-Party Lender's debt; and (iv) City shall have the right to transfer the
Project without acceleration of Third-Party Lender's debt to a nonprofit corporation or other entity
which shall own and operate the Project as an affordable rental housing Project, subject to the prior
written consent of the Third-Party Lender. Owner agrees to provide to City a copy of any notice
of default Owner receives from any Third-Party Lender within three (3) business days following
Owner's receipt thereof.
Eight Trees Phase Two Regulatory Agreement Recast 20
IN WITNESS WHEREOF, the City and the Borrower have executed this Agreement by
duly authorized representatives, all on the date first written above.
MP Willow Greenridge Associates, L.P.,
a California limited partnership
By: MP Greenridge LLC,
a California limited liability company,
its general partner
By: Mid-Peninsula Half Moon Bay, Inc.,
a California nonprofit public benefit
corporation, its sole member/manager
By: __________________________
Jan M. Lindenthal
Assistant Secretary
APPROVED AS TO FORM:
By: _____________________________
City Attorney
CITY:
CITY OF SOUTH SAN FRANCISCO, a
municipal corporation
By: ________________________________
Its: ________________________________
“A Notary Public or other officer completing this certificate verifies only the identity of the individual
who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or
validity of that document.”
STATE OF CALIFORNIA )
COUNTY OF SAN MATEO )
On ____________________, before me, ___________________________, Notary Public,
personally appeared , who proved
to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to
the within instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the
person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify UNDER PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature (Seal)
“A Notary Public or other officer completing this certificate verifies only the identity of the individual
who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or
validity of that document.”
STATE OF CALIFORNIA )
COUNTY OF SAN MATEO )
On ____________________, before me, ___________________________, Notary Public,
personally appeared , who proved
to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to
the within instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the
person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify UNDER PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature (Seal)
EXHIBIT A
Legal Description Willow Gardens Property
EXHIBIT B
Legal Description Greenridge Property
EXHIBIT C
Schedule of City Assisted Units
Income Limits Number of City Assisted
Units
Very Low Income
( “50%” AMI Limits)
16
60% AMI
( “60%” AMI Limits) 17
Low Income
(“80%” AMI Limits)
35
Total City Assisted Units 68
3873070.1
EXHBIT B:
SUBORDINATION AGREEMENT
2689/036894-0002
16950938.2 a10/06/21
RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:
First Republic Bank
111 Pine Street
San Francisco, CA 94111
Attn: Loan Review
______________________________________________________________________________
NOTICE: THIS SUBORDINATION AGREEMENT RESULTS IN YOUR
RIGHTS UNDER CERTAIN AGREEMENTS RELATING TO CERTAIN
REAL PROPERTY BECOMING SUBJECT TO, AND OF LOWER
PRIORITY THAN, THE LIEN OF A SECURITY INTEREST.
SUBORDINATION AGREEMENT
THIS SUBORDINATION AGREEMENT (this “Agreement”) dated as of the 1st day
of _______, 202_, is made by and between the CITY OF SOUTH SAN FRANCISCO, a
municipal corporation (together with its permitted successors and assigns as legal or beneficial
owner of the Junior Loan Documents (“Junior Lender”) and FIRST REPUBLIC BANK, a
California banking corporation (together with its successors and assigns as legal holder of the
Senior Note, “Senior Lender”).
RECITALS:
A. MP Willow Greenridge Associates, LP, a California limited partnership
(“Borrower”) has applied to Senior Lender for a loan (the “Senior Loan”) for the acquisition,
construction, rehabilitation, development, equipping and/or operation of the Property (as
hereinafter defined).
B. The Senior Loan is evidenced by that certain Promissory Note Secured by Deed of
Trust evidencing the Senior Loan dated as of _____, 20__ in the maximum principal amount of
$_____________ made by Borrower payable to the order of Senior Lender (the “Senior Note”).
C. The Senior Loan is secured by, among other things, that certain Deed of Trust,
Fixture Filing, Assignment of Rents and Security Agreement dated as of _____, 20__ executed
by Borrower for the benefit of Senior Lender, and to be recorded substantially currently herewith
(the “Senior Security Instrument”), which Senior Security Instrument encumbers the Property.
Together, the Senior Security Instrument, the Senior Note, and all other documents executed in
connection with the Senior Loan, as the same may from time to time be extended, modified or
amended in accordance with the provisions of this Agreement, are the “Senior Loan Documents.”
D. Junior Lender has made a loan (the “Junior Loan”) to Borrower in the original
principal amount of $__________, which Junior Loan is evidenced by that certain Amended and
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Restated Promissory Note dated as of _____, 20__ made by Borrower to Junior Lender (the
“Junior Note”) and secured by the Junior Security Instrument (as hereinafter defined)
encumbering the Property.
E. In connection with the Junior Loan, Borrower has executed those certain
Regulatory Agreements and Declarations of Restrictive Covenants (Willow Gardens/ Greenridge),
each dated as of _______, 20__ (collectively, the “Regulatory Agreement”) in favor of Junior
Lender, which Regulatory Agreement is in Junior Lender’s customary form and which, among
other things, sets forth certain restrictions upon the occupancy, rents, operation, ownership and
maintenance of the Property and have been recorded in the Office of the Recorder of San Mateo
County on ________ as Instrument No. ____________.
H. As a condition to the making of the Senior Loan, Senior Lender requires that Junior
Lender execute and deliver this Agreement in connection with Junior Lender and Borrower
entering into the Junior Loan Documents (as defined below).
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, and to induce the making of the Senior Loan and to induce Senior
Lender to consent to the Junior Loan and the Junior Security Instrument, Junior Lender hereby
agrees as follows:
AGREEMENT
1. Definitions. Capitalized terms used but not defined in this Agreement shall have
the meanings ascribed thereto in the Senior Security Instrument. As used in this Agreement, the
terms set forth below shall have the respective meanings indicated:
“Bankruptcy Proceeding” means any bankruptcy, reorganization, insolvency, composition,
restructuring, dissolution, liquidation, receivership, assignment for the benefit of creditors, or
custodianship action or proceeding under any federal or state law with respect to Borrower or the
Property.
“Casualty” means the occurrence of damage to or loss of any of the Property by fire or
other casualty.
“Condemnation” means any proposed or actual condemnation or other taking, or
conveyance in lieu thereof, of all or any part of the Property, whether direct or indirect.
“Enforcement Action” means occurrence of any of the following with respect to either the
Senior Loan or the Junior Loan: the acceleration of all or any part of the Junior Indebtedness or
the Senior Indebtedness, as applicable, the advertising of or commencement of any foreclosure or
trustee’s sale proceedings, the exercise of any power of sale, the acceptance of a deed or
assignment in lieu of foreclosure or sale, the collecting of Rents, the obtaining of or seeking of the
appointment of a receiver, the seeking of default interest, the taking of possession or control of
any of the Property, the commencement of any suit or other legal, administrative, or arbitration
proceeding related to the enforcement of the Junior Loan Documents or the Senior Loan
Documents, as applicable, or the exercising of any banker’s lien or rights of set-off or recoupment,
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or the taking of any other enforcement action against Borrower, any other party liable for any of
the Junior Indebtedness or the Senior Indebtedness, as applicable, or the Property.
“Enforcement Action Notice” means a written notice from Junior Lender or Senior Lender
to the other party, given following a Junior Loan Default or a Senior Loan Default and the
expiration of any notice or cure periods applicable thereto, setting forth in reasonable detail the
Enforcement Action proposed to be taken by Junior Lender or Senior Lender, as applicable.
“Junior Indebtedness” means all indebtedness of any kind at any time evidenced or
secured by, or arising under, the Junior Loan Documents, whether incurred, arising or accruing
before or after the filing of any Bankruptcy Proceeding.
“Junior Lender” shall have the meaning set forth in the introductory paragraph to this
Agreement.
“Junior Loan Default” means any act, failure to act, event, condition, or occurrence which
constitutes, or which with the giving of notice or the passage of time, or both, would constitute, an
“Event of Default” as defined in the Junior Loan Documents.
“Junior Loan Documents” means, collectively, the Junior Note, the Junior Security
Instrument, the Regulatory Agreement, and all other documents evidencing, securing or delivered
in connection with the Junior Loan, as the same may be extended, modified and amended in
accordance with the provisions hereof.
“Junior Security Instrument” means that certain Deed of Trust, Assignment of Rents,
Security Agreement and Fixture Filing recorded in the Official Records on _________ as
Instrument No. ____________, as the same may from time to time be extended, modified or
amended in accordance with the provisions hereof.
“Regulatory Agreement” has the meaning set forth in the Recitals.
“Loss Proceeds” means all monies received or to be received under any insurance policy,
from any condemning authority, or from any other source, as a result of any Condemnation or
Casualty.
“Property” means (i) a 70-unit multifamily residential project located in the City of South
San Francisco, County of San Mateo, California, known or to be known as Willow Greenridge,
which Property is more particularly described on Exhibit A attached hereto, and (ii) all furniture,
fixtures and equipment located at such apartments and other property, accounts, deposits and rights
and interests of Borrower related thereto.
“Senior Indebtedness” means all indebtedness of any kind at any time evidenced or secured
by, or arising under, the Senior Loan Documents, whether incurred, arising or accruing before or
after the filing of any Bankruptcy Proceeding.
“Senior Lender” shall have the meaning set forth in the introductory paragraph to this
Agreement.
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“Senior Loan Default” means any act, failure to act, event, condition, or occurrence which
constitutes, or which with the giving of notice or the passage of time, or both, would constitute, an
“Event of Default” as defined in the Senior Loan Documents.
“Senior Loan Documents” shall have the meaning set forth in the Recitals.
2. Junior Loan and Junior Loan Documents are Subordinate to Senior Loan
Documents; Acts by Senior Lender Not Affecting Subordination of Junior Loan Documents.
(a) Junior Lender hereby covenants and agrees on behalf of itself and its
successors and permitted assigns that the Junior Indebtedness is and shall at all times
continue to be, subordinate, subject and inferior (in payment and priority) to the prior
payment in full of the Senior Indebtedness, and that the liens, rights, payment interests,
priority interests and security interests granted to Junior Lender in connection with the
Junior Loan and under the Junior Loan Documents are, and are hereby expressly
acknowledged to be in all respects and at all times, subject, subordinate and inferior in all
respects to the liens, rights, payment, priority and security interests granted to Senior
Lender under the Senior Loan and the Senior Loan Documents and the terms, covenants,
conditions, operations and effects thereof.
(b) Prior to a Senior Loan Default (regardless of whether such Default occurs
prior to or during the pendency of a Bankruptcy Proceeding), Junior Lender shall be
entitled to receive and retain scheduled payments made pursuant to and in accordance with
the terms of the Junior Loan Documents. Junior Lender agrees that from and after a Senior
Loan Default (until such time as such default has either been cured or has been expressly
waived in writing by Senior Lender), such period being referred to as the “Senior Default
Period”, Junior Lender shall promptly remit, any payments, properties, and assets received
by Junior Lender during the Senior Default Period to the address set forth herein or such
other address designated by Senior Lender in a written notice. Senior Lender shall apply
any payment, asset, or property so received from Junior Lender to the Senior Indebtedness
in such order, amount (with respect to any asset or property other than immediately
available funds), and manner as Senior Lender shall determine in its sole and absolute
discretion.
(c) Without limiting the complete subordination of the Junior Loan to the
payment in full of the Senior Loan, in any Bankruptcy Proceeding, upon any payment or
distribution to creditors, the Senior Loan shall be paid in full first in cash before the Junior
Lender shall be entitled to receive any payment or other distribution on account of or in
respect to the Junior Loan and, until the entire Senior Loan is paid in full in cash, any
payment or distribution to which the Junior Lender will be entitled but for this Agreement
(whether in cash, property or other assets) shall be paid to Senior Lender.
(d) The subordination of the Junior Loan Documents to the Senior Indebtedness
hereunder shall continue in the event that any payment under the Senior Loan Documents
(whether by or on behalf of Borrower, as proceeds of security or enforcement of any right
of set-off or otherwise) is for any reason repaid or returned to Borrower or its insolvent
estate, or avoided, set aside or required to be paid to Borrower, a trustee, receiver or other
2689/036894-0002
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similar party under any bankruptcy, insolvency, receivership or similar law. In such event,
the Senior Indebtedness or part thereof originally intended to be satisfied shall be deemed
to be reinstated and outstanding to the extent of any repayment, return, or other action, as
if such payment on account of the Senior Indebtedness had not been made.
(e) The subordination of the Junior Loan Documents to the Senior Indebtedness
shall apply and continue notwithstanding (i) the actual date and time of execution, delivery,
recording, filing or perfection of the documents, and (ii) the availability of any collateral
to Senior Lender, including the availability of any collateral other than the Property.
(f) By reason of, and without in any way limiting, the subordination provided
for in this Agreement, all rights and claims of Junior Lender under the Junior Security
Instrument or under the Junior Loan Documents in or to the Property or any portion thereof,
the proceeds thereof, the Leases thereof, the Rents, issues and profits therefrom, and the
Loss Proceeds payable with respect thereto, are expressly subject and subordinate in all
respects to the rights and claims of Senior Lender under the Senior Loan Documents in and
to the Property or any portion thereof, the proceeds thereof, the Leases thereof, the Rents,
issues and profits therefrom, and the Loss Proceeds payable with respect thereto.
(g) Junior Lender hereby acknowledges and agrees that Senior Lender may,
without the prior written consent of Junior Lender, agree with Borrower to extend, modify,
or amend any or all the Senior Loan Documents and otherwise act or fail to act with respect
to any matter set forth in any Senior Loan Document. Notwithstanding the foregoing, no
modification or amendment of the Senior Loan Documents shall be effective against Junior
Lender without its prior written consent, not to be unreasonably withheld, conditioned or
delayed (and deemed received if no response is received from Junior Lender within thirty
(30) days following delivery of a written request therefor stating that the matters therein
will be deemed approved if no response is delivered thereto within 30 days) which does
any of the following: (1) increases the principal loan amount due and payable thereunder,
excluding any increases due solely to any protective advances (as permitted under
applicable law) under the Senior Security Instrument, (2) increases the interest rate payable
under the Senior Indebtedness, (3) reduces the term of the Senior Loan or (4) increases the
amount of the periodic debt service payments due under the Senior Loan.
3. Junior Lender Agreements.
(a) Junior Lender may not, without the prior written consent of Senior Lender,
agree with Borrower to extend, modify, or amend any or all of the Junior Loan Documents
and otherwise act or fail to act with respect to any matter set forth in any Junior Loan
Document.
(b) Junior Lender and Senior Lender agree that all original policies of casualty
and property damage insurance required pursuant to the Senior Loan Documents and the
Junior Loan Documents shall be held by Borrower, or with the consent of Borrower or as
required by the Senior Loan Documents, by Senior Lender. Both Senior Lender and Junior
Lender may require that they each be named as a loss payee, as their respective interests
may appear, under all policies of casualty and property damage insurance maintained by
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Borrower with respect to the Property; and both Senior Lender and Junior Lender shall be
given notice of and be entitled to participate in and give their input with respect to any and
all negotiations and settlements of, and decisions with respect to, any and all insurance
claims under all such policies, including without limitation any agreements as to the
amount and timing of all insurance payments due thereunder. Until the Senior Loan is
repaid in full or this Agreement is terminated, Senior Lender shall have the sole right to
settle and adjust all casualty insurance claims.
(c) Junior Lender and Senior Lender further agree that both Senior Lender and
Junior Lender shall be given notice of and be entitled to participate in any and all
negotiations and settlements of, and decisions with respect to, any and all Condemnations
related to the Property, including without limitation any agreements as to the amount,
manner of payment, interests being compensated for and timing of any and all awards or
other payments made with respect thereto. Until the Senior Loan is repaid in full or this
Agreement is terminated, Senior Lender shall have the sole right to settle and adjust all
Condemnation claims.
(d) Until the Senior Loan is paid in full or this Agreement is terminated, all
Loss Proceeds received or to be received on account of a Casualty or a Condemnation
action, or both, shall be applied (either to the payment of the costs and expenses of repair
and restoration of the Property or to the payment of the Senior Loan) in the manner
determined by Senior Lender pursuant to the terms of the Senior Loan Documents;
provided, however, that if Senior Lender elects to apply such Loss Proceeds to payment of
the principal of, interest on and other amounts payable under the Senior Loan, any Loss
Proceeds remaining after the satisfaction in full of the principal of, interest on and other
amounts payable under the Senior Loan shall immediately upon such satisfaction be paid
and disbursed to, and may, subject to the rights of any other lenders senior in priority to
the liens of the Regulatory Agreement and Junior Security Instrument, be applied by, Junior
Lender in its sole and absolute discretion in accordance with the applicable provisions of
the Junior Loan Documents.
(e) Junior Lender shall not (i) commence or join with any other creditor for the
purpose of commencing any involuntary Bankruptcy Proceeding involving Borrower or
(ii) commence any action, motion or request, in a Bankruptcy Proceeding involving any
other person or entity, which seeks the consolidation of some or all of the assets of
Borrower into such Bankruptcy Proceeding. Notwithstanding the foregoing, once any such
Bankruptcy Proceeding, consolidation, or other proceeding has been independently
initiated and commenced, then each of Junior Lender and Senior Lender shall, in their
independent discretion and election, be free to participate in and/or take any other actions
with respect to any and all such proceedings in such manner as each may, in its sole and
absolute discretion, determine is in its respective best interests. In the event of any
Bankruptcy Proceeding relating to Borrower or the Property or, in the event of any
Bankruptcy Proceeding relating to any other person or entity into which (notwithstanding
the covenant in the first sentence of this paragraph) the assets or interests of Borrower are
consolidated, then in either event, until the payment in full of the Senior Loan or other
termination of this Agreement, any and all rights and interests granted to Junior Lender
under the Junior Loan Documents in and to any and all payments, revenues and proceeds
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generated by the Property in such bankruptcy or other proceedings, and all claims and
rights of Junior Lender to receive and apply the same as contemplated in the Junior Loan
Documents, are, and are hereby expressly acknowledged to be in all respects and at all
times prior to the full repayment of the Senior Loan or other termination of this Agreement,
subject, subordinate and inferior in priority to any and all rights and interests granted to
Senior Lender in and to the such proceeds under the Senior Loan Documents, including
any and all claims and rights to receive and apply the same as contemplated therein, so
long as the same are either used and applied to the repayment of the Senor Loan or for the
repair and restoration of the Property. Junior Lender agrees that (i) the Senior Lender shall
receive all payments and distributions of every kind or character in respect of the Junior
Lender’s Loan to which the Junior Lender would otherwise be entitled, before the
subordination provisions of this Agreement (including, without limitation, any payments
or distributions during the pendency of any bankruptcy, insolvency, receivership or similar
proceeding involving Borrower or the Property) until the Senior Loan is repaid in full, and
(ii) the subordination of the Junior Lender’s Loan and the Junior Loan Documents shall
not be affected in any way by the Senior Lender electing, under Section 1111(b) of the
Federal Bankruptcy Code, to have its claim treated as being a fully secured claim. In
addition, Junior Lender hereby covenants and agrees that, in connection with such a
proceeding involving Borrower, neither Junior Lender nor any of its affiliates shall
(i) make or participate in a loan facility to or for the benefit of Borrower on a basis that is
senior to or pari passu with the liens and interests held by Senior Lender pursuant to the
Senior Loan Documents and (ii) not contest the continued accrual of interest on the Senior
Loan, in accordance with and at the rate specified in the Senior Loan Documents, both for
periods before and for periods after commencement of such proceedings.
(f) Junior Lender acknowledges that it entered into the transactions
contemplated by the Junior Loan Documents and made the Junior Loan to Borrower
without reliance upon any judgment or advice from Senior Lender. Junior Lender made
its own underwriting analysis in connection with the Junior Loan, its own credit review of
Borrower, and investigated all matters pertinent, in Junior Lender’s judgment, to its
determination to make the Junior Loan to Borrower.
(g) Borrower hereby represents and warrants that: (i) Junior Lender is now the
owner and holder of the Junior Loan Documents; (ii) the Junior Loan Documents are now
in full force and effect; (iii) the Junior Loan Documents have not been modified or
amended; (iv) no default or event which, with the passing of time or giving of notice would
constitute a default, under the Junior Loan Documents has occurred; and (v) the
outstanding principal amount of the Junior Indebtedness is $_________. Borrower further
represents and warrants that it has provided to Senior Lender a true, complete, and correct
copy of all the Junior Loan Documents.
(h) Borrower hereby represents and warrants that: (i) Senior Lender is now the
owner and holder of the Senior Loan Documents; (ii) the Senior Loan Documents are now
in full force and effect; (iii) the Senior Loan Documents have not been modified or
amended; (iv) no default or event which, with the passing of time or giving of notice would
constitute a default, under the Senior Loan Documents has occurred; and (v) the
outstanding principal amount of the Senior Indebtedness is $_________. Borrower further
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represents and warrants that it has provided to Junior Lender a true, complete, and correct
copy of all the Senior Loan Documents.
(i) Junior Lender further agrees that its agreement to subordinate hereunder
shall extend to any new mortgage debt which is for the purpose of refinancing all or any
part of the Senior Loan (including reasonable and necessary costs associated with the
closing and/or the refinancing but not including additional funds above the then-current
Senior Loan unpaid principal balance together with such reasonable and necessary closing
and/or refinancing costs) and protective advances pursuant to the Senior Security
Instrument. All the terms and covenants of this Agreement shall inure to the benefit of any
holder of any such refinanced debt; and all references to the Senior Loan, the Senior Note,
the Senior Security Instrument, the Senior Loan Documents and Senior Lender shall mean,
respectively, the refinance loan, the refinance note loan agreement, the mortgage securing
the refinance note, all documents evidencing securing or otherwise pertaining to the
refinance note and the holder thereof.
(j) For purposes of this Agreement, Junior Lender acknowledges that Junior
Lender has been provided the opportunity to review the Senior Loan Documents before
executing this Agreement;
(k) Junior Lender acknowledges that Senior Lender, in making disbursements
of the Senior Loan, is under no obligation or duty to insure, nor has Senior Lender
represented that it will insure, the proper application of such proceeds by the person(s) to
whom Senior Lender disburses such proceeds, and any application or use of such proceeds
for purposes other than as provided in any such agreement shall not defeat or render invalid,
in whole or in part, the subordination provided for in this Agreement;
(l) Junior Lender acknowledges that Senior Lender has not made any warranty
or representation of any kind or nature whatsoever to Junior Lender with respect to (i) the
application of the proceeds of the Senior Loan being made by Senior Lender to Borrower
upon the security of the Senior Deed of Trust, (ii) the value of the Property, the
improvements to be constructed thereon pursuant to the Senior Security Instrument or the
marketability or value thereof upon completion of such construction, or (iii) the ability of
Borrower to honor its covenants and agreements with Senior Lender or Junior Lender;
(m) Junior Lender acknowledges that Senior Lender’s release of any security
for the Senior Loan, including, without limitation, the reconveyance of any portion(s) of
the Project from the lien of the Senior Deed of Trust shall not constitute a waiver or
relinquishment of Junior Lender’s unconditional subordination of the liens or charges of
Junior Lender Documents against the Project to the lien or charge of the Senior Deed of
Trust;
(n) Junior Lender acknowledges that Senior Lender would not make the Senior
Loan to Borrower absent the execution of this Agreement by Junior Lender;
(o) Junior Lender acknowledges that Senior Lender has no duty to disclose to
Junior Lender any facts Senior Lender may now know or hereafter know about Borrower
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or the partners or successors of Borrower, regardless of whether (i) Senior Lender has
reason to believe that any such facts may increase materially the risk beyond that which
Junior Lender intends to assume, (ii) Senior Lender may have reason to believe that such
facts are unknown to Junior Lender, or (iii) Senior Lender has a reasonable opportunity to
communicate such facts to Junior Lender, it being understood and agreed that Junior
Lender is fully responsible for being and keeping informed of the financial condition of
Borrower and/or any partners or successors of Borrower and of all circumstances bearing
on the risk of non-payment of any indebtedness of Borrower to Senior Lender described in
this Agreement;
(p) As of the date set forth above, Junior Lender has no offset, defense,
deduction or claim against Borrower under any of the Junior Loan Documents;
(q) Each and every covenant, condition and obligation contained in the Junior
Loan Documents required to be performed or satisfied as of the date hereof, and each and
every matter required to be approved the Junior Lender as of the date hereof, has been
satisfied and/or approved and/or waived as applicable, including, without limitation, all
conditions precedent to Borrower’s right to commence and complete construction of the
improvements and those matters listed in Sections ______________ of the Junior Loan
Agreement, all of which conditions have been satisfied and/or approved and/or waived, as
applicable, as of the date set forth above;
(r) Reserved;
(s) Reserved;
(t) Reserved;
(u) Notwithstanding anything stated to the contrary in the Junior Loan
Documents, Junior Lender’s rights in and to the leases and rents of the Property shall be
subject and subordinate to the rights of Senior Lender to same; and
(v) Notwithstanding anything stated to the contrary in the Junior Loan
Documents, the occurrence of a Senior Loan Default shall not in and of itself constitute a
Junior Loan Default unless the occurrence of such event shall constitute a separate default
under the Junior Loan Documents.
(w) The subordination of the Junior Loan shall continue in the event that any
payment with respect to any Senior Loan Document (whether by or on behalf of Borrower,
as proceeds of security or enforcement of any right of set-off or otherwise) is for any reason
repaid or returned to Borrower or its insolvent estate, or avoided, set aside or required to
be paid to Borrower, a trustee, a receiver or other similar party under any bankruptcy,
insolvency or receivership or similar law under any bankruptcy, insolvency, receivership
or similar proceeding. In such event, the Senior Loan or any part thereof originally
intended to be satisfied shall be deemed to be reinstated and outstanding to the extent of
any repayment, return or other action, as if such payment on account of the Senior Loan
had not been made.
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4. Standstill Agreement; Right to Cure Senior Loan Default.
(a) Until such time as any of the Senior Indebtedness has been repaid in full
and the Senior Security Instrument has been released and discharged, for a period of sixty
(60) days from the date of delivery to Senior Lender of a written notice of a Junior Loan
Default after the expiration of any notice and cure periods applicable thereto, Junior Lender
shall not without the prior written consent of Senior Lender, which may be withheld only
in the exercise of Senior Lender’s sole and absolute discretion, commence any judicial or
non-judicial foreclosure action or proceeding nor shall Junior Lender exercise any other
rights or remedies it may have under the Junior Loan Documents, including, but not limited
to accelerating the Junior Loan (and enforcing any “due on sale” provision included in the
Junior Loan Documents), collecting rents, appointing (or seeking the appointment of) a
receiver or exercising any other rights or remedies thereunder; provided, however, that
such limitation on the remedies of Junior Lender shall not limit Junior Lender’s rights to
(i) send all pre-notice of default letters, default notices (other than a recorded statutory
notice of default under Civil Code Section 2924c) and/or other notices to Borrower or other
persons, including without limitation any such notices or letters determined by Junior
Lender as being necessary or desirable to get any and all pre-cure, cure or other periods
running and/or taking any and all other actions necessary to satisfy any and all other
preconditions to an Event of Default under the Junior Loan Documents, or (ii) compute
interest on all amounts due and payable under the Junior Loan Documents at the default
rate described in the Junior Loan Documents and computing prepayment premiums, if any,
and late charges thereunder.
(b) Senior Lender hereby consents to the existence of the Junior Loan
Documents and agrees that the execution and, where applicable, recording of the Junior
Loan Documents does not constitute a Senior Loan Default. Senior Lender shall,
simultaneously with the sending of any notice of a Senior Loan Default to Borrower, send
to Junior Lender a copy of said notice under the Senior Loan Documents; provided,
however, failure to send such notice of default shall not affect the validity of such notice
or any obligation of Borrower to Senior Lender and shall not affect the relative priorities
between the Senior Loan and the Junior Loan as set forth herein. Borrower covenants and
agrees to forward to Junior Lender, within three (3) business days of Borrower’s receipt
thereof, a copy of any notice of a Senior Loan Default Borrower receives from Senior
Lender.
(c) Upon the occurrence of a Senior Loan Default, Senior Lender shall
concurrently with notifying Borrower of the occurrence of such Senior Loan Default, notify
Junior Lender at its address set forth herein of the occurrence of such Senior Loan Default.
Junior Lender shall have the right, to the extent that Borrower has any such cure right under
the Senior Loan Documents, but shall have no obligation, to cure any Senior Loan Default;
provided, if Junior Lender shall elect to cure any such Default, it shall so notify Senior
Lender and shall commence and complete such curing within any applicable notice or grace
period, if any, as Borrower is permitted by the terms of the Senior Loan Documents to cure
such Senior Loan Default. Senior Lender shall have the continuing right to commence to
pursue its remedies under the Senior Loan Documents on account of such Senior Loan
Default, including but not limited to the right to accelerate the Senior Loan, record a notice
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of default and to obtain a receiver; provided further, that if the cure is completed by Junior
Lender within such permitted cure period, Senior Lender will rescind any Senior Loan
Default after reimbursement of all of its costs incurred in connection with the Senior Loan
Default, including, without limitation, attorneys’ fees and court costs. Senior Lender shall
accept all payments and all acts done by Junior Lender on behalf of Borrower within such
permitted cure period as though the same had been timely done and performed by
Borrower, so that such acts and payments shall fully and totally cure and correct all such
defaults, breaches, failures or refusals for all purposes. Junior Lender shall not be
subrogated to the rights of Senior Lender under the Senior Loan Documents by reason of
Junior Lender having cured any Senior Loan Default; however, Senior Lender
acknowledges that, to the extent so provided in the Junior Loan Documents, amounts
advanced or expended by Junior Lender to cure a Senior Loan Default may be added to
and become a party of the Junior Lender’s Loan. The provisions of this Section 4(c) are
intended to supplement, and not to limit, terminate, waive, modify or replace, in whole or
in part, those provisions of law pertaining to notice and cure rights of junior encumbrancers
including, without limitation, those set forth in California Civil Code Sections 2924b and
2924c (if applicable), all of which shall continue to be available to Junior Lender,
regardless or any other term or provision of this Agreement, or whether or not Junior
Lender avails itself of any rights granted to it under this Agreement, including, without
limitation this Section 4(c).
(d) In the event that a Senior Loan Default occurs and Senior Lender has
recorded a notice of default, then for the period from the date of recordation of the notice
of default, until the date of recordation of a notice of sale, so long as the noticed Senior
Loan Default continues, Junior Lender shall have the right, but not the obligation, in lieu
of curing the Senior Loan Default, to purchase the Senior Loan. Such purchase will be
accomplished by Junior Lender paying to Senior Lender the outstanding principal amount
of the Senior Loan, plus all accrued and unpaid interest thereon and any prepayment
premium, together with reasonable expenses incurred by Senior Lender in connection
therewith (including reasonable attorneys’ fees and costs), in exchange for the assignments
of the Senior Loan Documents without recourse or warranty except that Senior Lender will
warrant that it owns and has all requisite authority to transfer the Senior Loan at the time
of the transfer. Borrower acknowledges and agrees, by executing this Agreement, that after
the Senior Loan has been assigned to Junior Lender or its nominee, Senior Lender shall be
relieved from all liability to Borrower under or in connection with the Senior Loan
Documents.
(e) Junior Lender acknowledges that any conveyance or other transfer of title
to the Property pursuant to a foreclosure of the Junior Security Instrument (including a
conveyance or other transfer of title pursuant to the exercise of a power of sale contained
in the Junior Security Instrument), shall be subject to the transfer provisions of the Senior
Loan Documents; and the person (including Junior Lender) who acquires title to the
Property pursuant to the foreclosure proceeding (or pursuant to the exercise of a power of
sale contained in the Junior Security Instrument) shall not be deemed to be automatically
approved by Senior Lender.
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5. Junior Loan Default. Junior Lender shall give Senior Lender a concurrent copy
of each notice of a Junior Loan Default or other material notice given by Junior Lender under the
Junior Loan Documents; provided, however, that failure to send such notice of default shall not
affect the validity of such notice or any obligation of Borrower to Junior Lender. Senior Lender
shall have the right, but not the obligation, to cure any Junior Loan Default within sixty (60) days
following the date of such notice; provided, however that Junior Lender shall be entitled, during
such sixty (60) day period, to continue to pursue its rights and remedies under the Junior Loan
Documents, subject to the rights and limitations contained in this Agreement. All amounts paid
by Senior Lender in accordance with the Senior Loan Documents to cure a Junior Loan Default
shall be deemed to have been advanced by Senior Lender pursuant to, and shall be secured by, the
Senior Security Instrument.
6. Default. Senior Lender and Junior Lender each acknowledge and agree that in the
event either party fails to comply with its obligations hereunder, the other party shall have all rights
available at law and in equity, including the right to obtain specific performance of the obligations
of such defaulting party and injunctive relief, but the exercise of such rights shall be subject to the
terms and limitations of this Agreement, including, without limitation, Section 4(a). If at any time
Borrower cures any Senior Loan Default to the satisfaction of Senior Lender, or Senior Lender
agrees to waive the same, as evidenced by written notice from Senior Lender to Junior Lender that
such default has been fully cured or waived and that Borrower is no longer in default under the
Senior Loan Documents, any default under the Junior Loan Documents to the extent arising from
such Senior Loan Default shall be deemed cured and provided there are no other, independent
defaults under the Junior Loan Documents, the Junior Loan and Senior Loan shall both be
retroactively reinstated as if such Senior Loan Default had never occurred.
7. Enforcement Costs. In the event any legal action is filed to enforce or interpret
this Agreement, then the prevailing party in such action shall be entitled to receive from the non-
prevailing party the prevailing party’s reasonable attorneys’ fees and other legal costs.
8. Notices. Any notice which any party hereto may be required or may desire to give
hereunder shall be deemed to have been given and shall be effective only if it is in writing and
(i) delivered personally, (ii) mailed, postage prepaid, by United State registered or certified mail,
return receipts requested, or (iii) delivered by overnight express courier, in each instance addressed
as follows:
If to Borrower: MP Willow Greenridge Associates, LP
303 Vintage Park Drive, Suite 250
Foster City, CA 94404
Attn: Ms. Alice Talcott and Mr. Jeffrey Summerville
If to Junior Lender: City of South San Francisco
_____________________
_____________________
_____________________
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If to Senior Lender: First Republic Bank
111 Pine Street
San Francisco, CA 94111
Attn: Commercial Loan Servicing
or at such other addresses or to the attention of such other persons as may from time to time be
designated by the party to be addressed by written notice to the other in the manner herein
provided. Notices, demands and requests given in the manner aforesaid shall be deemed
sufficiently served or given for all purposes hereunder when received or when delivery is refused
or when the same are returned to sender for failure to be called for.
9. Term. The term of this Agreement shall commence on the date hereof and shall
continue until the earliest to occur of the following events: (i) the payment of all of the principal
of, interest on and other amounts payable under the Senior Loan Documents; (ii) the payment of
all of the principal of, interest on and other amounts payable under the Junior Loan Documents,
other than by reason of payments which Junior Lender is obligated to remit to Senior Lender
pursuant to the terms hereof; (iii) the acquisition by Senior Lender of Borrower’s interest in the
Property pursuant to a foreclosure, of (or the exercise of a power of sale contained in) the Senior
Security Instrument; or (iv) the acquisition by Junior Lender of Borrower’s interest in the Property
pursuant to a foreclosure, or a deed in lieu of foreclosure, of (or the exercise of a power of sale
contained in) the Junior Security Instrument, but only if such acquisition of title does not violate
any of the terms of this Agreement.
10. Miscellaneous.
(a) Either party to this Agreement shall, within thirty (30) business days
following a request from the other party, provide the requesting party with a written
statement setting forth the then current outstanding principal balance of that party’s loan,
the aggregate accrued and unpaid interest under their loan, and stating whether, to the
knowledge of that lender, any default or event of default exists under the loan, and
containing such other information with respect to the indebtedness as the requesting party
may reasonably require.
(b) This Agreement shall bind and inure to the benefit of all successors and
assigns of Junior Lender and Senior Lender. Senior Lender may assign its interest in the
Senior Loan Documents without advance notice to or consent of Junior Lender. Junior
Lender shall not, without the prior written approval of Senior Lender, assign the Junior
Loan Documents to any party other than another governmental entity.
(c) Senior Lender hereby consents to the Junior Loan and the Junior Loan
Documents; provided, however, that this Agreement does not constitute an approval by
Senior Lender of the terms of the Junior Loan Documents. Junior Lender hereby consents
to the Senior Loan and the Senior Loan Documents; provided, however, that this
Agreement does not constitute an approval by Junior Lender of the terms of the Senior
Loan Documents.
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(d) This Agreement may be executed in counterpart originals, each of which
shall constitute an original and all of which, when taken together, shall constitute one and
the same instrument.
(e) IN ALL RESPECTS, INCLUDING, WITHOUT LIMITATION,
MATTERS OF CONSTRUCTION AND PERFORMANCE OF THIS AGREEMENT
AND THE OBLIGATIONS ARISING HEREUNDER, THIS AGREEMENT HAS BEEN
ENTERED INTO AND DELIVERED IN, AND SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY, THE LAWS OF THE STATE WHERE
THE PROPERTY IS LOCATED, WITHOUT GIVING EFFECT TO ANY PRINCIPLES
OF CONFLICTS OF LAW.
(f) Time is of the essence in the performance of every covenant and agreement
contained in this Agreement.
(g) If any provision or remedy set forth in this Agreement for any reason shall
be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision or remedy of this Agreement and this
Agreement shall be construed as if such invalid, illegal or unenforceable provision or
remedy had never been set forth herein, but only to the extent of such invalidity, illegality
or unenforceability.
(h) Each party hereto hereby represents and warrants that this Agreement has
been duly authorized, executed and delivered by it and constitutes a legal, valid and binding
agreement enforceable in all material respects in accordance with its terms.
(i) Borrower hereby acknowledges and consents to the execution of this
Agreement, and agrees to be bound by the provisions hereof that are applicable to
Borrower. By executing this Agreement in the place provided below, Borrower hereby
(i) acknowledges the provisions hereof, (ii) agrees not to take any action inconsistent with
Senior Lender’s rights or Junior Lender’s rights under this Agreement, (iii) waives and
relinquishes to the maximum extent permitted by law any and all rights, defenses and
claims now existing or hereinafter accruing relating to Junior Lender’s forbearance from
exercising any rights and remedies pursuant to Section 4 of this Agreement, including,
without limitation, any defenses based on the statute of limitations or any equitable
defenses, such as laches, and (iv) acknowledges and agrees that (A) this Agreement is
entered into for the sole protection and benefit of Senior Lender and Junior Lender (and
their respective successors, assigns and participants), and no other person (including
Borrower) shall have any benefits, rights or remedies under or by reason of this Agreement,
(B) nothing in this Agreement is intended, or shall be construed to, relieve or discharge the
obligations or liabilities of any third party (including Borrower under the Senior Loan
Documents and the Junior Loan Documents), (C) neither of them nor any of their affiliates
shall be, or be deemed to be, beneficiaries of any of the provisions hereof or have any rights
hereunder whatsoever, and (D) no provision of this Agreement is intended to, or shall be
construed to, give any such third party (including Borrower) any right subrogating to the
rights of, or action against, Senior Lender or Junior Lender.
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(j) No amendment, supplement, modification, waiver or termination of this
Agreement shall be effective against any party unless such amendment, supplement,
modification, waiver or termination is contained in a writing signed by such party.
(k) No party other than Senior Lender and Junior Lender shall have any rights
under, or be deemed a beneficiary of any of the provisions of, this Agreement.
(l) Nothing herein or in any of the Senior Loan Documents or Junior Loan
Documents shall be deemed to constitute Senior Lender as a joint venturer or partner of
Junior Lender.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the undersigned have duly executed and delivered this
Subordination Agreement or caused this Subordination Agreement to be duly executed and
delivered by their respective authorized representatives as of the date first set forth above. The
undersigned intend that this instrument shall be deemed to be signed and delivered as a sealed
instrument.
JUNIOR LENDER:
CITY OF SOUTH SAN FRANCISCO,
a municipal corporation
By:
Name:
Title: City Manager
APPROVED AS TO FORM:
_____________________________
City Attorney
(Signatures follow on subsequent page)
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SENIOR LENDER:
FIRST REPUBLIC BANK
By:
Name:
Title:
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ACKNOWLEDGED AND AGREED AS OF THE DATE FIRST SET FORTH ABOVE:
BORROWER:
MP WILLOW GREENRIDGE ASSOCIATES, L.P.,
a California limited partnership
By: MP Greenridge LLC,
a California limited liability company,
its general partner
By: Mid-Peninsula Half Moon Bay, Inc.,
a California nonprofit public benefit corporation,
its sole member/manager
By: __________________________
Name: Jan M. Lindenthal
Title: Assistant Secretary
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A Notary Public or other officer completing this certificate verifies only the identity of the
individual who signed the document to which this certificate is attached, and not the truthfulness,
accuracy, or validity of that document.
State of California )
County of ______________________ )
On _________________________, before me, ,
(insert name and title of the officer)
Notary Public, personally appeared ,
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the
person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature (Seal)
A Notary Public or other officer completing this certificate verifies only the identity of the
individual who signed the document to which this certificate is attached, and not the truthfulness,
accuracy, or validity of that document.
State of California )
County of ______________________ )
On _________________________, before me, ,
(insert name and title of the officer)
Notary Public, personally appeared ,
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the
person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature (Seal)
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A Notary Public or other officer completing this certificate verifies only the identity of the
individual who signed the document to which this certificate is attached, and not the truthfulness,
accuracy, or validity of that document.
State of California )
County of ______________________ )
On _________________________, before me, ,
(insert name and title of the officer)
Notary Public, personally appeared ,
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the
person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature (Seal)
2689/036894-0002
16950938.2 a10/06/21
EXHIBIT A
LEGAL DESCRIPTION
[CHECK – to be inserted]
EXHIBIT C:
RELOCATION PLANS
Greenridge Apartments
1565 El Camino Real
South San Francisco, CA 94080
RELOCATION PLAN
Prepared for
MidPen Housing
303 Vintage Park Drive Suite 250
Foster City, CA 94404
by
Autotemp
373 4th Street Suite 2A
Oakland, CA 94607
August 2021
RELOCATION PLAN – GREENRIDGE APARTMENTS
Autotemp Page 2
INTRODUCTION
Since its inception in 1970, MidPen Housing Corporation (MidPen or Developer) has
earned a reputation as one of northern California’s leading, non-profit sponsors and
developers of assisted rental housing for low-, and moderate-income families,
seniors, single adults and, persons with special needs. The Corporation includes two
other affiliated corporations; MidPen Property Management Corporation (MPPMC)
and MidPen Resident Services Corporation (MPRSC).
The housing management corporation is the affiliate which manages over 90
properties in 29 cities and towns in the San Francisco/Monterey Bay regions.
MPPMC has provided professional property management services for over twenty
years. The service corporation (MPRSC) provides on-site service coordination;
computer education programs for students, seniors and, persons with special needs;
summer youth programs; arranges for on-site child care; and, provides a broad
range of services and supports for MPPMC residents.
MidPen – through a limited partnership- MP Willow Greenridge Associates, L.P. (LP
or Developer) proposes to acquire, and undertake an extensive rehabilitation of the
Greenridge Apartments (Greenridge) along with Willow Gardens, as a scattered site
project.
The Project
The proposed project, Greenridge, consist of 34 units townhome style units within
eight buildings; 17 two-bedroom, 13 three-bedroom and four four-bedroom
apartments, of which one three-bedroom unit is reserved for the property manager.
The apartments are designated for families and subsidized with Low Income
Housing Tax Credits (LIHTC), City of South San Francisco and former
Redevelopment Agency loans, HOME funding, County of San Mateo Affordable
Housing funds and CDBG. The units are affordable to households earning between
30% and 60% Area Media Income (AMI). Located at 1565 El Camino Real in South
San Francisco, the apartments generally have a zero percent vacancy rate. The
property currently offers laundry facilities, computer center, children’s play area and
a community room.
The Developer proposes the rehabilitation of the existing residential structures. The
interior work, based on physical needs assessment will include energy efficient
RELOCATION PLAN – GREENRIDGE APARTMENTS
Autotemp Page 3
lighting, water heaters and HVAC. Exterior work will include window replacement
and site accessibility work. Four of the units will be converted to mobility accessible
units including two with hearing and visually impaired improvements.
The dwelling units which are the subject of this Relocation Program are located in
the City of South San Francisco and County of San Mateo. The subject property is
located on El Camino Real just south of Hickey Boulevard, generally east of
Interstate 280. The area is generally comprised of multi- and single family
residential, commercial and institutional uses. For the regional and site-specific
locations, the subject property is shown at ‘Project Site Maps’ (Attachment 1).
The project will comply with all General Plan guidelines, housing element and zoning
requirements of the City and is compatible with adjacent land uses. There is no
foreseen negative impact on the surrounding neighborhood.
Prospective funding sources are conventional financing, 9% LIHTC, San Mateo
County AHF and CDBG funds, and recast of the City of South San Francisco
funding.
As a result of the Project, four of the households will be temporarily displaced, to
allow the conversion to ADA accessible units to occur in an orderly and safe
manner. Prior to construction, any vacancies will be held vacant, to minimize
disruption through the completion of the Project.
Autotemp, an experienced acquisition and relocation firm, has been selected to
prepare this Relocation Plan (‘Plan’), and will provide all subsequently required
relocation assistance. In compliance with statutory requirements, the Plan has been
prepared to evaluate the present circumstances and replacement housing
requirements of the current Project occupants. The Developer will provide all
subsequently required relocation assistance to the households which will be
temporarily displaced.
This Plan sets forth policies and procedures which would be necessary to conform to
statutes and regulations established by the Federal, Uniform Relocation Act (46
U.S.C. § 4600 et seq.), its implementing regulations (49 C.F.R.) Part 24); and, the
California Relocation Assistance Law, California Government Code Section 7260 et
seq (the “CRAL”) and the California Relocation Assistance and Real Property
Acquisition Guidelines, Title 25, California Code of Regulations, Chapter 6, Section
RELOCATION PLAN – GREENRIDGE APARTMENTS
Autotemp Page 4
6000 et seq. (the "Guidelines") for residential displacements and the funding
agencies’ own rules and regulations, including HUD 1378.
In should be noted that, with certain narrow exceptions, Federal funds cannot be
used for any “displaced person” who is an alien not lawfully present in the United
States.
No mandatory displacement activities will take place prior to the required reviews
and approval of this Plan.
RELOCATION PLAN
This Relocation Plan has been prepared in accordance with the provisions of the
Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970,
as amended, (the ‘Uniform Act’); ); and, the California Relocation Assistance Law,
California Government Code Section 7260 et seq (the “CRAL”) and the California
Relocation Assistance and Real Property Acquisition Guidelines, Title 25, California
Code of Regulations, Chapter 6, Section 6000 et seq. (the "Guidelines") for
residential displacements, along with the funding agencies’ own rules and
regulations.
No displacement activities will take place prior to the required reviews and approval
of this Plan. In order to attain its overall development goals for the Project, it is the
Developer’s intention to provide a fair and equitable relocation program for all
eligible Project displacees.
A. General Demographic and Housing Characteristics
To obtain information necessary for the implementation of the Plan, interviews will
be conducted with the current tenants on the Project site. Inquiries made of the
occupants will include primary language in the home, disabilities and health
problems, and preferences related to temporary replacement housing and location.
All information of a statistical nature supplied by property management was purely
anecdotal in nature and not validated by documentary evidence such as will
otherwise be required to comply with relocation qualifying criteria.
RELOCATION PLAN – GREENRIDGE APARTMENTS
Autotemp Page 5
The standard housing density utilized provides for two (2) persons per bedroom and
one person in a common living area for tenant occupied units although, this can be
adjusted to include two persons in the common living area. There is currently no
overcrowding.
Relocation activities will consider individual household needs to be close to public
transportation, employment, schools, public/social services and agencies,
recreational services, parks, community centers, or shopping.
Relocation Assistance information and assistance will be provided in the primary
language of the displaced occupants, in order to assure that all displaced occupants
obtain a complete understanding of the relocation plan and eligible benefits. Both
English and Spanish were identified as the primary languages.
B. RELOCATION HOUSING RESOURCES AND NEEDS
The interview process will be used to determine housing preferences or reported
need to be close to public transportation, employment, schools, public/social
services and agencies, recreational services, parks, community centers, or
shopping. In addition, health needs, which will require special consideration for
accessibility, and perhaps proximity to medical facilities, will be identified. The
interviews will be performed by relocation staff and confidentiality will be maintained.
The ADA conversion is scheduled to be completed in multiple phases, two units at a
time. Each unit will require the household to be out of their unit for approximately
one month. No household will be moved off-site for a period greater than one year.
The construction sequencing and number of units at a time is solely based on the
availability of off-site units.
All other interior work will be performed with the households remaining in place,
while the window, lighting, water heater and HVAC work is performed. Except for the
ADA units, households may be required to spend several hours a day, for a
maximum of five days (not necessarily in the same week), in the hospitality suite.
Access to telephones and other amenities will minimize the household’s
inconvenience. The contractor, who specializes in in-place rehabilitations, has
developed their schedule to minimize disruption to the households.
RELOCATION PLAN – GREENRIDGE APARTMENTS
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When entering a resident unit to perform the prearranged scope of work for that
day, professional movers will move the resident’s belongings located in the work
area (kitchen, bathroom, etc.) to another area in the unit. Additional care, such as
covering or boxing the belongings, will be taken to ensure the items are not
damaged. Upon completion of that day’s scope of work, the movers will move the
belongings back into place.
The residential hospitality suite in community space, will accommodate the residents
during the construction activities being performed in their units. This hospitality
suites will be equipped with furniture, television, and other amenities for the
residents’ comfort during their time out of their unit. Drinks and snacks will be
provided. If the Covid-19 pandemic is still a factor, a safety plan will be developed,
either providing for alternative temporary housing or multiple hospitality suites,
maintaining social distancing.
C. REPLACEMENT HOUSING RESOURCES
A resource survey will be conducted prior to any mandatory displacement to identify
available comparable, decent, safe and sanitary units, which are adequate in size,
and contain the required number of bedrooms for each household, in the South San
Francisco area. Referrals will be made to “open-market” housing. For the purposes
of this Plan, a survey of the nearby area found availability of sufficient housing to
accommodate prospectively temporarily displaced households. These potential
replacement housing resources include corporate housing, offering fully furnished
apartments.
D. CONCURRENT RESIDENTIAL DISPLACEMENT
Based on the needs of the Project, there is no concurrent displacement, either by
the Developers or others, which may impact upon the ability to relocate the Project
occupants, based upon the findings of the housing resource study.
E. TEMPORARY HOUSING
There is no anticipated need for temporary housing beyond what is outlined in this
Plan. Should such a need arise, the Developer will respond appropriately, and in
conformance with all applicable laws and requirements.
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F. PROGRAM ASSURANCES AND STANDARDS
There shall be adequate funds budgeted to relocate all temporarily displaced
households. All displacement and re-housing services will be provided to ensure
that displacement does not result in different, or separate treatment of households
based on race, nationality, color, religion, national origin, sex, marital status, familial
status, disability or any other basis protected by the federal Fair Housing
Amendments Act, the Americans with Disabilities Act, Title VI of the Civil Rights Act
of 1964, Title VII of the Civil Rights Act of 1964, Title VIII of the Civil Rights Act of
1968, the California Fair Employment & Housing Act, and the Unruh Act, as well as
any otherwise arbitrary, or unlawful discrimination.
All households will receive a Notice of Non-Displacement/General Information Notice
(see Attachment 2) and will receive a minimum of a 90 day notice prior to their need
to move, followed by a 30 day notice and a seven day notice, for those households
being temporally displaced. Upon completion of the rehabilitated housing, no
household will be economically displaced, with housing costs limited to 30% of the
household’s income or 105% of their current rent, whichever is greater. All
households qualify for the future funding programs.
G. RELOCATION ASSISTANCE PROGRAM
Autotemp staff is available to assist the temporarily displaced tenants with questions
regarding relocation and/or assistance in relocating. Relocation staff can be
contacted Toll-free at 888.202.9195 from 8:30 a.m. to 6:00 p.m., Monday through
Friday and also available on-site by appointment. The Relocation Office is located
at 373 4th Street, Suite 2A, Oakland, CA 94607.
A comprehensive relocation assistance program, with technical and advisory
assistance, will be provided to the households being displaced. Close contact will
be maintained with each household. Specific activities will:
1. Fully inform eligible project occupants of the nature of, and procedures
for, obtaining relocation assistance.
2. Determine the needs of each residential displacee eligible for
assistance;
RELOCATION PLAN – GREENRIDGE APARTMENTS
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3. Provide assistance that does not result in different or separate
treatment due to race, color, religion, national origin, sex, sexual
orientation, marital status or other arbitrary circumstances;
4. Assist each eligible person to complete applications for benefits.
5. Make relocation benefit payments in accordance with the Guidelines,
where applicable;
6. Inform all persons subject to displacement of the Developer’s policies
with regard to eviction and property management; and,
7. Establish and maintain a formal grievance procedure for use by
displaced persons seeking administrative review of the Developer’s
decisions with respect to relocation assistance.
H. CITIZEN PARTICIPATION
The Developer will ensure the following:
1. Resident meetings will be help to promote education and
understanding of the relocation program;
2. Full and timely access to documents relevant to the relocation
program;
3. Provision of technical assistance necessary to interpret elements of the
relocation program and other pertinent materials;
4. The Plan will be reviewed to ensure that it is feasible; and complies with
locally-adopted rules and regulations governing relocation.
I. RELOCATION BENEFIT CATEGORIES
Benefits will be provided in accordance with URA, the CRAL, the Guidelines, and all
other applicable regulations and requirements. Benefits will be paid upon
submission of required claim forms and documentation in accordance with approved
RELOCATION PLAN – GREENRIDGE APARTMENTS
Autotemp Page 9
procedures. The Developer will provide appropriate benefits for any eligible
household as required by the above laws and requirements.
Specific eligibility requirements and benefit plans will be detailed on an individual
basis with all displaced households. In the course of personal interviews and follow-
up visits, each displaced household will be counseled as to available options and the
consequences of any choice with respect to financial assistance.
Residential Moving Expense Payments
Any and all temporarily displaced households will be eligible to receive a payment
for moving expenses. The payment will be made based upon an invoice for actual
reasonable moving expenses from a licensed professional mover.
Moving expenses will be based on Actual Reasonable Moving Expense
Payments – The displaced tenants will receive the services of a licensed,
professional mover to perform the move; the Developer will pay for the actual cost of
the move as follows. The payment will be made directly to the mover and may
include:
(a) Transportation of the displaced person and personal property.
Transportation costs for a distance beyond 50 miles are not
eligible, unless the Developer determines that relocation beyond
50 miles is justified.
(b) Packing, crating, unpacking, and uncrating of the personal
property.
(c) Disconnecting, dismantling, removing, reassembling, and
reinstalling relocated household appliances and other personal
property.
(d) Storage of the personal property for a period not to exceed 12
months, unless the Developer determines that a longer period is
necessary.
(e) Insurance for the replacement value of the property in
connection with the move and necessary storage.
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(f) The replacement value of property lost, stolen, or damaged in
the process of moving (not through the fault or negligence of the
displaced person, his or her agent, or employee) where
insurance covering such loss, theft, or damage is not
reasonably available.
(g) Other moving-related expenses that are not listed as ineligible
under § 24.301(h), as the Developer determines to be
reasonable and necessary.
Temporary Relocation
Those households which need to be moved temporarily off-site for rehabilitation
activities will be offered residential moving payments as outlined above. During their
temporary move, housing costs, for eligible households, will be limited to their
current rent plus utilities.
The Developer will pay any increased costs for housing, for eligible households,
directly to the pre-arranged, temporary landlord. If a household does not return to
Greenridge upon notification of an available unit, any rental or relocation assistance
will be terminated.
These potential replacement housing resources offer full amenities including
kitchens and utilities, thus avoiding the need to provide a meal allowance per-diem.
If the replacement housing does not include cooking facilities, a meal allowance will
be provided.
Eligible households, subject to the Developer’s approval, wishing to move
temporarily from the project for the duration of their displacement, to housing not
identified by the Developer (such as with family and/or friends) will be reimbursed,
pursuant to a pre-determined schedule, for rental assistance to accommodate their
household’s reasonable preferences.
Due to the temporary nature of such a move, accommodations will also be made for
storage of personal property, as necessary.
It is the Developer’s responsibility to ensure that each unit is “Decent Safe and
Sanitary” as defined in Section 24.2 (a) (8) of the Uniform Act at the end of each
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day. If not, the household will be offered the opportunity to stay at a local motel and
provided a per-diem allowance while off-site.
J. PAYMENT OF RELOCATION BENEFITS
Claims and supporting documentation for relocation benefits must be filed with the
Developer within eighteen (18) months from:
The date the claimant moves from the acquired property; or,
The date on which final payment for the acquisition of real
property is made, whichever is later.
The procedure for the preparation and filing of claims and the processing and
delivery of payments will be as follows:
1. Claimant(s) will provide all necessary documentation to
substantiate eligibility for assistance.
2. Assistance amounts will be determined in accordance
with the provisions of Relocation Law and guidelines, as may be
applicable.
3. Required claim forms will be prepared by relocation
personnel in conjunction with claimant(s). Signed claims and
supporting documentation will be submitted by relocation
personnel to the Developer.
4. The Developer will review, and approve claims for
payment, or request additional information.
5. The Developer will issue benefit checks which will be
delivered to the household, unless circumstances dictate
otherwise.
6. Final payments will be issued after confirmation that the
Project area premises have been completely vacated, and
actual residency at the replacement unit is verified.
RELOCATION PLAN – GREENRIDGE APARTMENTS
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7. Receipts of payment will be obtained and maintained in
the relocation case file.
No household will be displaced until “comparable” housing is located as defined
above. Relocation staff will inspect any replacement units to which referrals are
made to verify that they meet all the standards of decent, safe, and sanitary as
defined in Section 24.2 (a) (8) of the Uniform Act.
No household will be entitled to a rental assistance or replacement housing payment
if it chooses to move to a replacement unit which does not meet the standards of
decent, safe, and sanitary housing.
K. RELOCATION TAX CONSEQUENCES
In general, relocation payments are not considered income for the purpose of the
Internal Revenue Code of 1986, or the Personal Income Tax Law, Part 10, of the
Revenue and Taxation Code. The above statement on tax consequences is not
intended to be provision of tax advice by the Developer, MidPen, their Agents,
Consultants or, Assigns. Displacees are encouraged to consult with their own,
independent tax advisors concerning the tax consequences of relocation payments.
L. APPEALS POLICY
The appeals policy will follow the standards described in Section 6150 et seq. of the
Guidelines. Briefly stated, the displaced tenants will have the right to ask for review
when there is a complaint regarding any of their rights to relocation and relocation
assistance, such as a determination as to eligibility, the amount of payment, or the
failure to provide a comparable replacement housing referral.
M. EVICTION POLICY
Eviction by the Developer is permissible only as a last alternative. With the
exception of persons considered to be in unlawful occupancy, a displaced person’s
eviction does not affect eligibility for relocation assistance and benefits. Relocation
records must be documented to reflect the specific circumstances surrounding the
eviction.
Eviction may be undertaken only for one or more of the following reasons:
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1. Failure to pay rent, except in those cases where the failure to pay is
due to the Lessor’s failure to keep the premises in habitable condition;
is the result of harassment or retaliatory action; or, is the result of
discontinuation or substantial interruption of services;
2. Performance of a dangerous, and/or illegal act in the unit by tenant,
tenant’s guest(s) and/or invitee(s) or any combination thereof;
3. A material breach of the rental agreement and failure to correct breach
within 30 days of notice;
4. Maintenance of a nuisance, and failure to abate within a reasonable
time following notice;
5. Refusal to accept one of a reasonable number of offers of replacement
dwellings;
5. A requirement under State, or local law or emergency circumstances that
cannot be prevented by reasonable efforts on the part of the public entity.
N. PROJECTED DATES OF DISPLACEMENT
Displaced households will receive a minimum of a Ninety (90)-day Notice-to-Vacate.
Rehabilitation is anticipated to begin in November of 2021. This notice is expected to
be issued on or about August 01, 2021 for those households being temporarily
displaced in the first phase, and will be issued in advance for subsequent phases.
Prior to moving, all temporarily displaced households will enter into a Memorandum
of Understanding with the Developer, discussing each party’s responsibilities during
the move.
O. ESTIMATED RELOCATION COSTS
MidPen Housing and the Developer pledges to appropriate the necessary funds, on
a timely basis, to ensure the successful completion of the project using LIHTC’s and
new funding. Any and all required financial assistance will be provided. The
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Autotemp Page 14
anticipated budget for relocation benefits including implementation services and
oversight is as follows:
In-Place
Community Room Furnishings $13,500.00
Moving $39,400.00
Per Diem $40,000.00
Reasonable Accommodations $40,000.00
Relocation Services $32,000.00
Contingency $10,000.00
Total $176,900.00
ADA Conversions
Temporary Housing $35,000.00
Moving Assistance -two moves $20,000.00
Reasonable Accommodations $10,000.00
Relocation Services $11,500.00
Contingency $10,000.00
Total $86,500.00
GRAND TOTAL $263,400.00
(Remainder of page intentionally left blank)
RELOCATION PLAN – GREENRIDGE APARTMENTS
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TABLE OF ATTACHMENTS
Attachment 1: Project Site Maps
Attachment 2: Notice of Non-Displacement/General Information Notice
RELOCATION PLAN – GREENRIDGE APARTMENTS
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ATTACHMENT 1:
PROJECT SITE MAPS
Figure 1. Regional Site Location
Figure 2. Site-specific Location
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RELOCATION PLAN – GREENRIDGE APARTMENTS
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ATTACHMENT 2
Notice of Non-Displacement
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Willow Gardens
South San Francisco, CA 94080
RELOCATION PLAN
Prepared for
MidPen Housing
303 Vintage Park Drive Suite 250
Foster City, CA 94404
by
Autotemp
373 4th Street Suite 2A
Oakland, CA 94607
August 2021
RELOCATION PLAN – WILLOW GARDENS
Autotemp Page 2
INTRODUCTION
Since its inception in 1970, MidPen Housing Corporation (MidPen or Developer) has
earned a reputation as one of northern California’s leading, non-profit sponsors and
developers of assisted rental housing for low-, and moderate-income families,
seniors, single adults and, persons with special needs. The Corporation includes two
other affiliated corporations; MidPen Property Management Corporation (MPPMC)
and MidPen Resident Services Corporation (MPRSC).
The housing management corporation is the affiliate which manages over 90
properties in 29 cities and towns in the San Francisco/Monterey Bay regions.
MPPMC has provided professional property management services for over twenty
years. The service corporation (MPRSC) provides on-site service coordination;
computer education programs for students, seniors and, persons with special needs;
summer youth programs; arranges for on-site child care; and, provides a broad
range of services and supports for MPPMC residents.
MidPen – through a limited partnership- MP Willow Greenridge Associates, L.P. (LP
or Developer) proposes to acquire, and undertake an extensive rehabilitation of
Willow Gardens (Willow) along with Greenridge Apartments, as a scattered site
project.
The Project
The proposed project, Willow, consist of 36 two-bedroom townhome style
apartments, one of which is reserved for the property manager. The apartments are
designated for families and subsidized with Low Income Housing Tax Credits
(LIHTC), City of South San Francisco and former Redevelopment Agency loans,
HOME funding, County of San Mateo Affordable Housing funds and CDBG. The
units are currently affordable to households earning between 50% and 80% of the
Area’s Median Income (AMI). Located at 982, 986, 990 Brusco Way; 344, 383, 395
Susie Way; 976 Sandra Court; and 986 Nora Way in South San Francisco, the
apartments generally have a zero percent vacancy rate. The property currently
offers laundry facilities and a community room.
The Developer proposes the rehabilitation of the existing residential structures. The
interior work, based on a physical needs assessment, includes cabinets and
countertops, flooring, energy efficient lighting, HVAC, bathtubs and bath fixtures.
RELOCATION PLAN – WILLOW GARDENS
Autotemp Page 3
Exterior work will include window replacement, siding and stucco along with site
accessibility work. Four of the units will be converted to mobility accessible units,
including two with hearing and visually impaired (HVI) improvements.
The dwelling units which are the subject of this Relocation Program are located in
the City of South San Francisco and County of San Mateo. The subject property is
located west of Chestnut Avenue at Willow Avenue, generally east of State
Highway 82. The area is generally comprised of multi- and single family residential,
commercial and institutional uses. For the regional and site-specific locations, the
subject property is shown at ‘Project Site Maps’ (Attachment 1).
The project will comply with all General Plan guidelines, housing element and zoning
requirements of the City and is compatible with adjacent land uses. There is no
foreseen negative impact on the surrounding neighborhood.
Prospective funding sources are conventional financing; 9% LIHTC’s, San Mateo
County AHF and CDBG funding and recast of the City of South San Francisco
funding.
As a result of the Project, all of the current households will be temporarily displaced,
to allow rehabilitation and conversion to ADA accessible units to occur in an orderly
and safe manner. Prior to construction, any vacancies will be held vacant, to
minimize disruption through the completion of the Project.
Autotemp, an experienced acquisition and relocation firm, has been selected to
prepare this Relocation Plan (‘Plan’), and will provide all subsequently required
relocation assistance. In compliance with statutory requirements, the Plan has been
prepared to evaluate the present circumstances and replacement housing
requirements of the current Project occupants. The Developer will provide all
subsequently required relocation assistance to the households which will be
temporarily displaced.
This Plan sets forth policies and procedures which would be necessary to conform to
statutes and regulations established by the Federal, Uniform Relocation Act (46
U.S.C. § 4600 et seq.), its implementing regulations (49 C.F.R.) Part 24); and, the
California Relocation Assistance Law, California Government Code Section 7260 et
seq (the “CRAL”) and the California Relocation Assistance and Real Property
Acquisition Guidelines, Title 25, California Code of Regulations, Chapter 6, Section
RELOCATION PLAN – WILLOW GARDENS
Autotemp Page 4
6000 et seq. (the "Guidelines") for residential displacements and the funding
agencies’ own rules and regulations, including HUD 1378.
In should be noted that, with certain narrow exceptions, Federal funds cannot be
used for any “displaced person” who is an alien not lawfully present in the United
States.
No mandatory displacement activities will take place prior to the required reviews
and approval of this Plan.
RELOCATION PLAN
This Relocation Plan has been prepared in accordance with the provisions of the
Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970,
as amended, (the ‘Uniform Act’); ); and, the California Relocation Assistance Law,
California Government Code Section 7260 et seq (the “CRAL”) and the California
Relocation Assistance and Real Property Acquisition Guidelines, Title 25, California
Code of Regulations, Chapter 6, Section 6000 et seq. (the "Guidelines") for
residential displacements, along with the funding agencies’ own rules and
regulations.
No displacement activities will take place prior to the required reviews and approval
of this Plan. In order to attain its overall development goals for the Project, it is the
Developer’s intention to provide a fair and equitable relocation program for all
eligible Project displacees.
A. General Demographic and Housing Characteristics
To obtain information necessary for the implementation of the Plan, interviews will
be conducted with the current tenants on the Project site. Inquiries made of the
occupants will include primary language in the home, disabilities and health
problems, and preferences related to temporary replacement housing and location.
All information of a statistical nature supplied by property management was purely
anecdotal in nature and not validated by documentary evidence such as will
otherwise be required to comply with relocation qualifying criteria.
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Autotemp Page 5
The standard housing density utilized provides for two (2) persons per bedroom and
one person in a common living area for tenant occupied units although, this can be
adjusted to include two persons in the common living area. There is currently no
overcrowding.
Relocation activities will consider individual household needs to be close to public
transportation, employment, schools, public/social services and agencies,
recreational services, parks, community centers, or shopping.
Relocation Assistance information and assistance will be provided in the primary
language of the displaced occupants, in order to assure that all displaced occupants
obtain a complete understanding of the relocation plan and eligible benefits. Both
English and Spanish were identified as the primary languages.
B. RELOCATION HOUSING RESOURCES AND NEEDS
The interview process will be used to determine housing preferences or reported
need to be close to public transportation, employment, schools, public/social
services and agencies, recreational services, parks, community centers, or
shopping. In addition, health needs, which will require special consideration for
accessibility, and perhaps proximity to medical facilities, will be identified. The
interviews will be performed by relocation staff and confidentiality will be maintained.
The rehabilitation is scheduled to be completed in multiple phases, approximately 12
units at a time. Each unit will require the household to be out of their unit for
approximately four and one-half months. No household will be moved off-site for a
period greater than one year. The construction sequencing and number of units at a
time is solely based on the availability of off-site units.
C. REPLACEMENT HOUSING RESOURCES
A resource survey will be conducted prior to any mandatory displacement to identify
available comparable, decent, safe and sanitary units, which are adequate in size,
and contain the required number of bedrooms for each household, in the South San
Francisco area. Referrals will be made to “open-market” housing. For the purposes
of this Plan, a survey of the nearby area found availability of sufficient housing to
accommodate prospectively temporarily displaced households. These potential
RELOCATION PLAN – WILLOW GARDENS
Autotemp Page 6
replacement housing resources include corporate housing, offering fully furnished
apartments.
D. CONCURRENT RESIDENTIAL DISPLACEMENT
Based on the needs of the Project, there is no concurrent displacement, either by
the Developers or others, which may impact upon the ability to relocate the Project
occupants, based upon the findings of the housing resource study. Willow Gardens
will be using the same temporary housing resources as Greenridge sequentially.
E. TEMPORARY HOUSING
There is no anticipated need for temporary housing beyond what is outlined in this
Plan. Should such a need arise, the Developer will respond appropriately, and in
conformance with all applicable laws and requirements.
F. PROGRAM ASSURANCES AND STANDARDS
There shall be adequate funds budgeted to relocate all temporarily displaced
households. All displacement and re-housing services will be provided to ensure
that displacement does not result in different, or separate treatment of households
based on race, nationality, color, religion, national origin, sex, marital status, familial
status, disability or any other basis protected by the federal Fair Housing
Amendments Act, the Americans with Disabilities Act, Title VI of the Civil Rights Act
of 1964, Title VII of the Civil Rights Act of 1964, Title VIII of the Civil Rights Act of
1968, the California Fair Employment & Housing Act, and the Unruh Act, as well as
any otherwise arbitrary, or unlawful discrimination.
All households have received a Notice of Non-Displacement/General Information
Notice (see Attachment 2) on or about May 25, 2021 and will receive a minimum of a
90 day notice prior to their need to move, followed by a 30 day notice and a seven
day notice, for those households being temporally displaced. Upon completion of the
rehabilitated housing, no household will be economically displaced, with housing
costs limited to 30% of the household’s income or 105% of their current rent,
whichever is greater. All households qualify for the new funding programs.
RELOCATION PLAN – WILLOW GARDENS
Autotemp Page 7
G. RELOCATION ASSISTANCE PROGRAM
Autotemp staff is available to assist the temporarily displaced tenants with questions
regarding relocation and/or assistance in relocating. Relocation staff can be
contacted Toll-free at 888.202.9195 from 8:30 a.m. to 6:00 p.m., Monday through
Friday and also available on-site by appointment. The Relocation Office is located
at 373 4th Street, Suite 2A, Oakland, CA 94607.
A comprehensive relocation assistance program, with technical and advisory
assistance, will be provided to the households being displaced. Close contact will
be maintained with each household. Specific activities will:
1. Fully inform eligible project occupants of the nature of, and procedures
for, obtaining relocation assistance.
2. Determine the needs of each residential displacee eligible for
assistance;
3. Provide assistance that does not result in different or separate
treatment due to race, color, religion, national origin, sex, sexual
orientation, marital status or other arbitrary circumstances;
4. Assist each eligible person to complete applications for benefits.
5. Make relocation benefit payments in accordance with the Guidelines,
where applicable;
6. Inform all persons subject to displacement of the Developer’s policies
with regard to eviction and property management; and,
7. Establish and maintain a formal grievance procedure for use by
displaced persons seeking administrative review of the Developer’s
decisions with respect to relocation assistance.
H. CITIZEN PARTICIPATION
The Developer will ensure the following:
RELOCATION PLAN – WILLOW GARDENS
Autotemp Page 8
1. Resident meetings will be help to promote education and
understanding of the relocation program;
2. Full and timely access to documents relevant to the relocation
program;
3. Provision of technical assistance necessary to interpret elements of the
relocation program and other pertinent materials;
4. The Plan will be reviewed to ensure that it is feasible; and complies with
locally-adopted rules and regulations governing relocation.
I. RELOCATION BENEFIT CATEGORIES
Benefits will be provided in accordance with URA, the CRAL, the Guidelines, and all
other applicable regulations and requirements. Benefits will be paid upon
submission of required claim forms and documentation in accordance with approved
procedures. The Developer will provide appropriate benefits for any eligible
household as required by the above laws and requirements.
Specific eligibility requirements and benefit plans will be detailed on an individual
basis with all displaced households. In the course of personal interviews and follow-
up visits, each displaced household will be counseled as to available options and the
consequences of any choice with respect to financial assistance.
Residential Moving Expense Payments
Any and all temporarily displaced households will be eligible to receive a payment
for moving expenses. The payment will be made based upon an invoice for actual
reasonable moving expenses from a licensed professional mover.
Moving expenses will be based on Actual Reasonable Moving Expense
Payments – The displaced tenants will receive the services of a licensed,
professional mover to perform the move; the Developer will pay for the actual cost of
the move as follows. The payment will be made directly to the mover and may
include:
RELOCATION PLAN – WILLOW GARDENS
Autotemp Page 9
(a) Transportation of the displaced person and personal property.
Transportation costs for a distance beyond 50 miles are not
eligible, unless the Developer determines that relocation beyond
50 miles is justified.
(b) Packing, crating, unpacking, and uncrating of the personal
property.
(c) Disconnecting, dismantling, removing, reassembling, and
reinstalling relocated household appliances and other personal
property.
(d) Storage of the personal property for a period not to exceed 12
months, unless the Developer determines that a longer period is
necessary.
(e) Insurance for the replacement value of the property in
connection with the move and necessary storage.
(f) The replacement value of property lost, stolen, or damaged in
the process of moving (not through the fault or negligence of the
displaced person, his or her agent, or employee) where
insurance covering such loss, theft, or damage is not
reasonably available.
(g) Other moving-related expenses that are not listed as ineligible
under § 24.301(h), as the Developer determines to be
reasonable and necessary.
Temporary Relocation
Those households which need to be moved temporarily off-site for rehabilitation
activities will be offered residential moving payments as outlined above. During their
temporary move, housing costs, for eligible households, will be limited to their
current rent plus utilities.
RELOCATION PLAN – WILLOW GARDENS
Autotemp Page 10
The Developer will pay any increased costs for housing, for eligible households,
directly to the pre-arranged, temporary landlord. If a household does not return to
Willow upon notification of an available unit, any rental or relocation assistance will
be terminated.
These potential replacement housing resources offer full amenities including
kitchens and utilities, thus avoiding the need to provide a meal allowance per-diem.
If the replacement housing does not include cooking facilities, a meal allowance will
be provided.
Eligible households, subject to the Developer’s approval, wishing to move
temporarily from the project for the duration of their displacement, to housing not
identified by the Developer (such as with family and/or friends) will be reimbursed,
pursuant to a pre-determined schedule, for rental assistance to accommodate their
household’s reasonable preferences.
Due to the temporary nature of such a move, accommodations will also be made for
storage of personal property, as necessary.
J. PAYMENT OF RELOCATION BENEFITS
Claims and supporting documentation for relocation benefits must be filed with the
Developer within eighteen (18) months from:
The date the claimant moves from the acquired property; or,
The date on which final payment for the acquisition of real
property is made, whichever is later.
The procedure for the preparation and filing of claims and the processing and
delivery of payments will be as follows:
1. Claimant(s) will provide all necessary documentation to
substantiate eligibility for assistance.
2. Assistance amounts will be determined in accordance
with the provisions of Relocation Law and guidelines, as may be
applicable.
RELOCATION PLAN – WILLOW GARDENS
Autotemp Page 11
3. Required claim forms will be prepared by relocation
personnel in conjunction with claimant(s). Signed claims and
supporting documentation will be submitted by relocation
personnel to the Developer.
4. The Developer will review, and approve claims for
payment, or request additional information.
5. The Developer will issue benefit checks which will be
delivered to the household, unless circumstances dictate
otherwise.
6. Final payments will be issued after confirmation that the
Project area premises have been completely vacated, and
actual residency at the replacement unit is verified.
7. Receipts of payment will be obtained and maintained in
the relocation case file.
No household will be displaced until “comparable” housing is located as defined
above. Relocation staff will inspect any replacement units to which referrals are
made to verify that they meet all the standards of decent, safe, and sanitary as
defined in Section 24.2 (a) (8) of the Uniform Act.
No household will be entitled to a rental assistance or replacement housing payment
if it chooses to move to a replacement unit which does not meet the standards of
decent, safe, and sanitary housing.
K. RELOCATION TAX CONSEQUENCES
In general, relocation payments are not considered income for the purpose of the
Internal Revenue Code of 1986, or the Personal Income Tax Law, Part 10, of the
Revenue and Taxation Code. The above statement on tax consequences is not
intended to be provision of tax advice by the Developer, MidPen, their Agents,
Consultants or, Assigns. Displacees are encouraged to consult with their own,
independent tax advisors concerning the tax consequences of relocation payments.
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L. APPEALS POLICY
The appeals policy will follow the standards described in Section 6150 et seq. of the
Guidelines. Briefly stated, the displaced tenants will have the right to ask for review
when there is a complaint regarding any of their rights to relocation and relocation
assistance, such as a determination as to eligibility, the amount of payment, or the
failure to provide a comparable replacement housing referral.
M. EVICTION POLICY
Eviction by the Developer is permissible only as a last alternative. With the
exception of persons considered to be in unlawful occupancy, a displaced person’s
eviction does not affect eligibility for relocation assistance and benefits. Relocation
records must be documented to reflect the specific circumstances surrounding the
eviction.
Eviction may be undertaken only for one or more of the following reasons:
1. Failure to pay rent, except in those cases where the failure to pay is
due to the Lessor’s failure to keep the premises in habitable condition;
is the result of harassment or retaliatory action; or, is the result of
discontinuation or substantial interruption of services;
2. Performance of a dangerous, and/or illegal act in the unit by tenant,
tenant’s guest(s) and/or invitee(s) or any combination thereof;
3. A material breach of the rental agreement and failure to correct breach
within 30 days of notice;
4. Maintenance of a nuisance, and failure to abate within a reasonable
time following notice;
5. Refusal to accept one of a reasonable number of offers of replacement
dwellings;
6. A requirement under State, or local law or emergency circumstances
that cannot be prevented by reasonable efforts on the part of the public
entity.
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N. PROJECTED DATES OF DISPLACEMENT
Displaced households will receive a minimum of a Ninety (90)-day Notice-to-Vacate.
Rehabilitation is anticipated to begin in November of 2021. This notice is expected to
be issued on or about August 01, 2021 for those households being temporarily
displaced in the first phase, and will be issued in advance for subsequent phases.
Prior to moving, all temporarily displaced households will enter into a Memorandum
of Understanding with the Developer, discussing each party’s responsibilities during
the move.
O. ESTIMATED RELOCATION COSTS
MidPen Housing and the Developer pledges to appropriate the necessary funds, on
a timely basis, to ensure the successful completion of the project using LIHTC’s, tax-
exempt bonds and new funding. Any and all required financial assistance will be
provided. The anticipated budget for relocation benefits including implementation
services and oversight is as follows:
Temporary Relocation-34 Households
Temporary Housing $1,470,000.00
Moving Assistance -two moves $ 160,000.00
Reasonable Accommodations $ 5,000.00
Relocation Services $ 70,250.00
Contingency $ 97,000.00
Total $1,802,250.00
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TABLE OF ATTACHMENTS
Attachment 1: Project Site Maps
Attachment 2: Notice of Non-Displacement/General Information Notice
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ATTACHMENT 1:
PROJECT SITE MAPS
Figure 1. Regional Site Location
Figure 2. Site-specific Location
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ATTACHMENT 2
Notice of Non-Displacement
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