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Catellus/Afford Housing Senior 99055161 RECEIVED FOR RECORD AT 8:00 AM 1--a, "Oia- go&44 CA q,�,)-53 AFFORDABLE HOUSING AGREEMENT FOR SENIOR APARTMENTS BY AND BETWEEN FEB 11 1999 RoODOW In R ,:en sE LA QUINTA REDEVELOPMENT AGENCY, AGENCY AND CATELLUS RESIDENTIAL GROUP, INC. DEVELOPER Approved by the City Council on October 6,1998 551(a if II TABLE OF CONTENTS Page [100] SUBJECT OF AGREEMENT ........................................ 6 A. [101] Purpose of Agreement ........................................ 6 B. [102] The Redevelopment Plan ...................................... 6 C. [103] The Project Area............................................7 D. [104] The Site...................................................7 E. [105] Parties to the Agreement ....... . ............................. 7 1. [106] The Agency..........................................7 2. [107] The Developer ........................................ 8 3. [108] Prohibition Against Changing Ownership Management and Control of Developer and Prohibition Against Transfer of the SA Site ......................................... 8 F. [109] Representations by the Developer ............................... 9 G. [110] Representation by the Agency ................................. 10 [200] AGENCY ASSISTANCE .......................................... 10 A. [201] Acquisition and Construction Assistance .......................... 11 B. [202] Conditions Precedent to the Transfer of the SA Site ................. 13 C. [203] Acquisition of the SA Site .................................... 14 D. [204] Escrow ..................................... ............14 E. [205] [Intentionally Omitted] ...................................... 15 F. [206] Conveyance of Title and Delivery of Possession ................... 15 G. [2071 Condition of Title ........................................... 15 H. [208] Payment of the Purchase Price and Recordation of Deed ............ 16 I. [209] Title Insurance.............................................16 J. [210] Taxes and Assessments ...................................... 17 K. [211 ] Conveyance Free of Possession ................................ 17 L. [212] Inspections; Condition of SA Site .............................. 17 1 Inspections................................................17 2. "As Is"...................................................17 3. Indemnity.................................................18 4. Release and Waiver ......................................... 18 - 5. Definitions ................................................ 18 6. Materiality................................................19 7. Right to Contest ............................................ 19 M. [213] Preliminary Work by the Developer ............................ 19 N. [214] Submission of Evidence of Equity Capital and Mortgage Financing for the SA Development ............................. 20 O. [215] Disbursement of Agency Assistance for Improvements ............. 20 1. Deposit of Agency Assistance ................................. 20 2. Initial Disbursements ........................................ 21 3. Conditions for Each Disbursement ............................. 21 4. Overhead Payments ......................................... 21 5. Monthly Reports...........................................22 CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 2 S51(a III. [300] DEVELOPMENT OF THE SITE .................................... 22 A. [301] Development of the SA Site .................................... 22 1. [302] Scope of Development .................................... 22 2. [303] Site Plan ............................................ 22 3. [304] Review and Approval of Plans, Drawings, and Related Documents ................................... 23 4. [305] Cost of Development . ............................... 23 5. [306] Construction Schedule ................................. 24 6. [307] Indemnity, Bodily Injury and Property Damage Insurance ..... 24 7. [308] City and Other Governmental Agency Permits .............. 24 8. [309] Rights of Access ..................................... 25 9. [310] Local, State and Federal Laws ........................... 25 10. [311] Anti -Discrimination ................................... 25 11. [312] Taxes and Assessments ................................ 25 B. [313] Prohibition Against Transfer of the SA Site, the Buildings or Structures Thereon and Assignment of Agreement ................. 26 C. [314] Right of the Agency to Satisfy Other Liens on the SA Site After Title Passes ........................................... 26 D. [315] Certificate of Completion ............................. ..... 26 E. [316] No Encumbrances Except Mortgages, Deeds of Trust, Sales and Leases -Back or Other Financing for Development ......... 27 F. [317] Holder Not Obligated to Construct Improvements ................. 27 G. [318] Notice of Default to Mortgage, Deed of Trust or Other . Security Interest Holders; Right to Cure ......................... 27 H. [319] Failure of Holder to Complete Improvements ..................... 28 I. [320] Right of Agency to Cure Mortgage, Deed of Trust or Other Security Interest Default .......................... 28 IV. [400] USE OF THE SITE ............................................... 29 A. [401 ] Affordable Housing ......................................... 29 1. Number of Units ........................................... 29 B. [402] Uses In Accordance with Redevelopment Plan; Nondiscrimination .... 29 C. [403] Effect of Violation of the Terms and Provisions of this Agreement After Completion of Construction .................... 31 D. [404] Maintenance of the SA Site ................................... 31 V. [500] DEFAULTS AND REMEDIES ..................................... 31 A. [501 ] Defaults -- General .......................................... 31 B. [502] Legal Actions..............................................32 1. [503] Institution of Legal Actions .............................. 32 2. [504] Applicable Law ....................................... 32 3. [505] Acceptance of Service of Process .......................... 32 C. [506] Rights and Remedies Are Cumulative ............................ 32 CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 3 55161 D. [507] Inaction Not a Waiver of Default ............................... 32 E. [508] Remedies and Rights of Termination ........................... 33 1. [509] Damages............................................33 2. [510] Specific Performance ........... ..................... 33 3. [511] Right of Termination by the Developer .................... 33 4. [512] Termination by the Agency ............................. 33 F. [513] Remedies of the Parties for Default After Closing of the Acquisition Escrow ...................................... 34 1 [514] Termination and Damages .............................. 34 G. [515] Option to Purchase, Reenter and Repossess ...................... 34 H. [516] Right of Reverter ........................................... 35 I. [5171 Agency Obligations to Repurchase Site ......................... 36 VI. [600] GENERAL PROVISIONS ......................................... 37 A. [601] Notices, Demands and Communications Between Parties ........... 37 B. [602] Conflicts of Interest ......................................... 37 C. [6031 Enforced Delay; Extension of Times of Performance ............... 38 D. [604] Non -Liability of Officials and Employees of the Agency and the Developer..........................................38 E. [6051 Entire Agreement, Waivers ................................... 38 F. [606] Amendments to this Agreement ................................. 39 VII. [700] TIME FOR ACCEPTANCE OF AGREEMENT BY AGENCY ............ 39 CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 4 55161 ATTACHMENTS Attachment No. I The SA Site; Attachment No. 2 Legal Description Attachment No. 3 Scope of Development Attachment No. 4 Schedule of Performance Attachment No. S Grant Deed Attachment No. 6 SA Promissory Note Attachment No. 7 SA Deed of Trust Attachment No. 8 Declaration of Conditions, Covenants and Restrictions Attachment No. 9 Certificate of Completion Attachment No. 10 Application for Disbursement Attachment No. 11 SA Budget Schedule for Disbursement of Agency Funds Overhead Calculation and Payment Schedule CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 5 S5161 AFFORDABLE HOUSING AGREEMENT This Affordable Housing Agreement ("Agreement") is entered into this 61'' day of October, 1998, by and between LA QUINTA REDEVELOPMENT AGENCY, a public body corporate and politic (the "Agency") and CATELLUS RESIDENTIAL GROUP, INC., a California corporation (the "Developer"). The Agency and the Developer (collectively referred to as the "Parties") hereby agree as follows: I. [100] SUBJECT OF AGREEMENT A. [ 101 ] Purpose of Agreement The purpose of this Agreement and a separate Affordable Housing Agreement to be entered into concurrently herewith between the Agency and Developer ("SFR Agreement") is to effectuate the Redevelopment Plan (as hereinafter defined) for the La Quinta Redevelopment Project (the "Project") by providing for the improvement of certain property situated within the Project Area of the Project (the "Project Area"), by assisting in the financing of the acquisition and development of 34.4 acres (the "Site") situated within the Project Area, including the completion of 86 single-family homes and related improvements (the "SFR Development") on 22.4 acres (the "SFR Site") and approximately 118 units of senior apartments and related improvements (the "SA Development") on 13.37 acres (the "SA Site") and the long-term maintenance of such single-family housing and apartment units at an affordable housing cost for persons and households of low and moderate - income, all as more fully described in this Agreement and the SFR Agreement. The SA Development is more fully described in the Scope of Development (Attachment No. 3) to this Agreement. The SFR Development is more fully described in the Scope of Development (Attachment No. 3) to the SFR Agreement. The Agency financial assistance in this Agreement shall be utilized to effectuate a portion of the Agency's overall affordable housing program pursuant to the requirements of California Health and Safety Code Section 33334.2 to expend twenty percent (20%) of its increment funds to improve, increase and preserve the community's supply of low- and moderate housing. The acquisition and development of the Site and the occupancy of the apartment units as developed for households of limited incomes all as provided in this Agreement are in the vital and best interests of the City of La Quinta (the "City") and the health, safety and welfare of its residents, and in accord with the public purposes and provisions of applicable state and local laws and requirements under which the Project has been undertaken. B. [102] The Redevelopment Plan . This Agreement is subject to the provisions of the Redevelopment Plan for Project Area No. 2 (the "Redevelopment Plan") which was approved and adopted by Ordinance No. 43 of the City Council of the City of La Quinta on the 29t' day of November, 1983. Said ordinance and Redevelopment Plan are fully incorporated herein by reference. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 6 55161 Any amendment hereafter to the Redevelopment Plan (as so approved and adopted) which changes the uses or development permitted on the Site as proposed in this Agreement, -or otherwise changes the restrictions or controls that apply to the Site, or otherwise affects the Developer's obligations or rights with respect to the Site, shall not apply to the Site without the written consent of the Developer. ' Amendments to the Redevelopment Plan applying to other property in Project Area No. 2 shall not require the consent of the Developer. C. [103] The Pro-ect Area The La Quinta Redevelopment Project Area No. 2 ("Project Area") is located in the City and is generally bounded by Washington Street, the northern corporate boundary, Jefferson Street and Avenue 50. The exact boundaries are as set out in the Redevelopment Plan. D. [104] The Site The "SA Site" is currently owned by the Agency and consists of 13 acres of real property at the corner of 48' Avenue and Jefferson Street located within the Project Area in the City of La Quinta, County of Riverside. The SA Site is depicted in the SA Site Map on Attachment No. 1 attached hereto and incorporated herein by this reference. The legal description of the SA Site is provided on Attachment No. 2 attached hereto and incorporated hereby by this reference. According to the approved Specific Plan for the Site titled "Village on the Green", a maximum of 118 senior rental units will be developed on the SA Site in accordance with the "Scope of Development" and by the times set forth in the "Schedule of Performance, " which are attached hereto as Attachment Nos. 3 and 4, respectively, and incorporated herein by reference. Any material change, as reasonably determined by the Agency, in the Scope of Development (Attachment No. 3) or in the approved specific plan which affects the size, quality, or type of development proposed for the SA Site shall require the written approval of the Agency, which approval may be contingent upon the review and .renegotiation of all of the economic and financial terms of this Agreement and such other matters as the Agency shall deem appropriate.. E. [105] Parties to the Agreement [106] The Agency The Agency is a public body, corporate and politic, exercising governmental functions and powers and organized and existing under Chapter 2 of the Community Redevelopment Law of the State of California, Division 24 of the California Health and Safety Code, the principal office of the Agency is located at 78-495 Calle Tampico, La Quinta, California 92253, or such other address as Agency shall hereafter designate in writing to Developer. "Agency", as used in this Agreement, includes the La Quinta Redevelopment Agency and any and all assignees of or successors to its rights, powers and responsibilities. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 7 5S161 2. [107] The Developer The Developer, Catellus Residential Group, Inc., is a California corporation. The principal office and mailing addresses of the Developer for purposes of this Agreement is 5 Park Plaza, Suite 400, Irvine, California 92614. By executing this Agreement, each person signing on behalf of the Developer warrants and represents to the Agency that the Developer has the full power and authority to enter into this Agreement, that all authorizations required to make this Agreement binding upon the Developer have been obtained, and that the person or persons executing this Agreement on behalf of the Developer are fully authorized to do so. Whenever the term "Developer" is used in this Agreement, such term shall include any and all nominees, assignees, or successors in interests as herein provided. 3 . [108] Prohibition Against Changing Ownership Management and Control of Developer and Prohibition Against Transfer of the SA Site The qualifications and identity of the Developer are of particular interest to the Agency. It is because of these qualifications and identity that the Agency has entered into this Agreement with the Developer. Consequently, no person, whether a voluntary or involuntary successor of Developer shall acquire any rights or powers under this Agreement nor shall the Developer assign all or any part of this Agreement or the SA Site without the prior written approval of the Agency. A voluntary or involuntary sale or transfer of any interest in the Developer of the SA Site prior to the issuance of a Certificate of Completion for the SA Improvements with respect to the SA Site shall be deemed to constitute an assignment or transfer for the purposes of this Section 108, and the written approval of the Agency shall be required prior to effecting such an assignment or transfer. Any purported transfer, voluntarily or by operation of law, except with the prior written consent of the Agency, shall render this Agreement absolutely null and void and shall confer no rights whatsoever upon any purported assignee or transferee. Prior to the issuance of a Certificate of Completion for the SA Improvements (as defined in Section 302) on the SA Site, the Developer shall not, except as permitted by this Agreement, assign or attempt to assign this Agreement or any rights or duties herein, nor make any total or partial sale, transfer, conveyance, or assignment of the whole or any part of the SA Site or the Developer Improvements thereon, without the prior written approval of the Agency. Notwithstanding any other provision of this Agreement to the contrary, Agency approval of an assignment of this Agreement or transfer of the SA Site or any interest therein shall not be required in connection with: (a) the conveyance or dedication of any portion of the SA Site to the City of La Quinta or other appropriate governmental agency, including public utilities, where the granting of such easements permits or facilitates the development of the SA Site; and (b) any assignment of this Agreement or transfer of the SA Site or the SA Improvements located thereon to a limited liability company in which Developer is a member or has a greater than fifty percent (50%) ownership and management interest: and (c) any assignment of this Agreement or transfer of the SA Site and SA Improvements located thereon to a limited partnership in which Developer is a general partner or a special limited partner in accordance with the requirements of the Tax Credit Allocation CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 8 55161 Committee subject to approval of the Agency Executive Director: and (d) an assignment of this Agreement or transfer of the SA Site and SA Improvements located thereon to Catellus Residential Communities, Inc., (CRC) a California Corporation, provided however, Developer shall not be relieved of its obligations under this Agreement upon an assignment and transfer to CRC. This Section 108 shall become inapplicable after the Agency has issued a Certificate of Completion pursuant to Section 315 of this Agreement. F. [109] Representations by the Developer The Developer represents and warrants to the Agency as follows: 1. The Developer is duly established and in good standing under the laws of the State of California and has duly authorized, executed and delivered this Agreement and any and all other agreements and documents required to be executed and delivered by the Developer in order to carry out, give effect to, and consummate the transactions contemplated by this Agreement. This Agreement is enforceable against the Developer in accordance with its terms. 2. The Developer does not have any contingent obligations or contractual agreements which will materially adversely affect the ability of the Developer to carry out its obligations hereunder. 3. There are no pending or, so far as is known to the Developer, threatened, legal proceedings to which the Developer is or may be made a party or to which it or any of its property is or may become subject, which have not been fully disclosed in the material submitted to the Agency, which will materially adversely affect the ability of the Developer to carry out its obligations hereunder. 4. There is no action or proceeding pending or, to the Developer's best knowledge, threatened, looking toward the dissolution or liquidation of the Developer and there is no action or proceeding pending or, to the Developer's best knowledge, threatened by or against the Developer which could affect the validity and enforceability. of the terms of this Agreement, or adversely affect the ability of the Developer to carry out its obligations hereunder. 5. The Developer has, and will as required by its obligations hereunder, dedicate, allocate and otherwise make available, sufficient financial and other resources to perform its obligations under this Agreement. Each of the foregoing items 1 to 5, inclusive, shall be deemed to be an ongoing representation and warranty and shall survive the close of escrow for the SA Site and shall continue until issuance of the Certificate of Completion for the SA Development. The Developer shall advise the Agency in writing if there is any change material pertaining to any matters set forth or referenced in the foregoing items 1 to 5, inclusive. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 9 Ssl 61 G. [110] Representations by the Agency The Agency represents and warrants to Developer as follows: 1. Agency is a public body, corporate and politic, existing pursuant to the California Community Redevelopment Law (California Health and Safety Code Section 33000), which has been authorized to transact business pursuant to action of the City of La Quinta. Agency has full right, power and lawful authority to transfer the SA Site as provided herein and the execution, performance, and delivery of this Agreement by Agency has been fully authorized by all requisite actions on the part of Agency. The parties who have executed this Agreement on behalf of Agency are authorized to bind Agency by their signatures hereto. 2. Agency does not have any contingent obligations or contractual agreements which will materially adversely affect the ability of Agency to carry out its obligations hereunder. 3. There are no pending or, so far as is known to Agency, threatened, legal proceedings to which Agency is or may be made a party or to which it or any of its property is or may become subject, which will materially adversely affect the ability of Agency to carry out its obligations hereunder. 4. There is no action or proceeding pending or, to Agency's best knowledge, threatened, looking toward the dissolution or liquidation of Agency and there is no action or proceeding pending or, to Agency's best knowledge, threatened by or against Agency which could affect the validity and enforceability of the terms of this Agreement, or adversely affect the ability of Agency to carry out its obligations hereunder. 5. To the best of Agency's knowledge, the SA Site is not currently in violation of any law, ordinance, rule, regulation or requirement applicable to its use and operation. 6. Agency is not the subject of a bankruptcy proceeding. II. [200] AGENCY ASSISTANCE The Agency agrees to provide to Developer pursuant to the Agreement and the SFR Agreement, certain financial assistance and incentives in an amount not to exceed a total of Two Million Eight Hundred Eighty -Nine Thousand Two Hundred Sixty Dollars ($2,889,260), which shall include a write down of the purchase price for the Site; funding for the off -site public infrastructure improvements for the SA Development; and payment of public entity fees all as more particularly set forth in Sections 201 and 203 below (collectively, "Agency Assistance"). The Agency Assistance has been funded from the Agency's Low and Moderate Income Housing Fund. Accordingly, Developer acknowledges and agrees that the use of the SA Site shall be subject to all of the income and affordability restrictions set forth in this Agreement, and the Declaration of Covenants, Conditions and Restrictions (Attachment No. 8). CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 10 55161 A. [201] Acquisition and Construction Assistance 1. Agency shall provide a portion of the Agency Assistance in a maximum amount not to exceed Two Million Eight Hundred Eighty -Nine Thousand Two Hundred Sixty Dollars ($2,889,260) in financial assistance for the SA Development (the "SA Assistance") which shall be in part credited in the initial transfer of the property with the residue to be disbursed for those development and construction costs set forth in the budget ("SA Budget") described on Attachment No. 11 attached hereto. The SA Assistance shall be evidenced by a Promissory Note in the amount of $2,889,260 (the "SA Note") in the form of Attachment No. 6 and secured by a Deed of Trust (the "SA Deed of Trust") in the form of Attachment No. 7. The SA Deed of Trust shall secure the Developer's obligations to utilize the SA Assistance evidenced by the SA Note and to complete the SA Development substantially in accordance with the terms of this Agreement. 2. The SA Purchase Price shall be $913,100 This amount represents the Agency's pro rata acquisition costs of $663,100 for the land and the prorata cost of $250,000 for the improvements completed by the Agency for the SA Site. The Purchase Price shall be composed of a cash amount of One Dollar ($1.00) and a loan amount of $913,099 pursuant to the SA Note (Attachment No. 6). The SA Site shall be transferred to the Developer by Grant Deed in the form of Attachment No. 5. 3. The SA Note shall bear no interest and shall be due and payable in accordance with the terms of the SA Note. If the apartments are developed, the SA Note shall be canceled and the SA Deed of Trust shall be reconveyed after the term of forty (40) years of continuous implementation of the affordability restrictions if the Federal Tax Credits are successfully obtained. In the event a Phase IV of the SFR is developed in lieu of the apartments, the SA Note shall automatically be reduced by one -forty-fifth (1/45) of the SFR Note amount for each Restricted Unit sold on the date of Close of each Developer Conveyance Escrow (as defined in the SRF Agreement) and the Agency shall partially reconvey the SA Deed of Trust upon the close of each Developer Conveyance Escrow for each Restricted Unit in the Phase IV of the SFR Development, to a Moderate Income Household pursuant to Section 401 of the SFR Agreement. 4. Agency shall disburse from the SA Assistance amount for site preparation, grading, utility systems and streets., for other governmental agency fees, for project planning and development costs, for utility and bond costs, and for City fees as provided in the Budget (Attachment No. 11). In the event the SA Development is unable to obtain nine percent (9 %) federal and State tax credits, all of the SA Assistance shall be converted to a fourth phase of SFR Assistance as provided in Sections 201(6) and 302 below. The SA Assistance shall be disbursed to Developer in accordance with the provisions of Section 215 hereof. Developer shall have the right to reallocate and transfer SA Assistance between major Budget categories as set forth in Section 215(3)g below. Notwithstanding the above, no budget category shall be exceeded until such time as it is approved by the Agency Executive Director. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 11 551(a 5. In the event the total development and construction costs for the SA Development are less than the $10,557,521 set forth in the Budget for the SA Development set forth in Attachment No. 11, Agency shall be entitled to share in the Costs Savings. The "Costs Savings" shall be equal to the difference between the development and construction costs 'set forth in the Budget and the actual costs incurred by Developer in connection with the development, construction and sale or lease of the SA Development. For the purposes of the cost sharing arrangement, Actual Funds collected to underwrite the development is defined as cash inflows which permanently offset or limit Agency Assistance. Takeout financing, net operating income collected during lease -up, and net proceeds from the sale of tax credits qualify; construction loan proceeds do not. Increases in Actual Funds collected to underwrite the development and sale of the SA Development (excluding Agency Assistance) over the amount Budgeted as sources of funds in Attachment 11 may be used to offset overruns in cost incurred in arriving at a net Cost Savings and likewise net reduction in costs incurred may be used to off set Actual Funds which are less than budgeted Actual Funds collected. Developer shall receive seventy-five percent (75%) of any Cost Savings until such time as Developer has received $70,669 of Costs Savings on the SA Development. Thereafter, Agency shall receive fifty percent (50%) of all Costs Savings and Developer shall receive fifty percent (50%) of all Costs Savings for the SA Development on a pro rata basis. If a Phase IV of SFR Development is developed in lieu of the SA Development then Developer's right to share in Cost Savings under the SA Development shall be transferred to the SFR Development so that Developer shall receive seventy-five percent (75%) of any Cost Savings under the combined SFR Development including the fourth phase until Developer shall have received $187,500. Including both the SFR Development and the SA Development Developer receives 75% of the Cost Savings up to the first $250,000 in total Cost Savings, the allocation between the SFR and SA Developments is that derived under the "Cost Savings Math", Section of Attachment 11. 6. The Budget includes an allocation of $594,414 for Developer's Profit and $540,376 for Developer's Overhead, combined hereinafter referred to as Developer's Fee. This Developer's Fee shall be adjusted based upon Actual Funds collected (excluding Agency assistance) and costs incurred subject to sharing of Cost Savings as described in Section A(201)5. Developer's profit will be payable fifty percent (50%) upon the reservation and funding of the Government Equity as hereinafter described by third party tax credit investors and funded from the tax credit investment. The remaining fifty percent (50%) shall be funded upon leasing of all units, vesting of the award of tax credits, and final funding of the Government Equity for tax credits. Profit payments shall be funded from equity investments by the third party tax credit investors. The Developer's Overhead shall be paid monthly on a pro-rata basis during, the development period in accordance with Attachment 11. Developer anticipates bringing in a joint venture partner, Ecumenical Association for Housing ("EAH"), a non-profit entity, to assist in the development, financing, and management of the SA Development. Any fees due EAH are included in the Developer Fees, there shall be no increase in Developer Fees to account for EAH. Should Developer seek to replace EAH with another partner, said replacement partner shall be a non-profit entity and shall be subject to the approval of the Agency. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 12 55161 Developer guarantees that the costs to develop the SA Development, excluding the costs of land and HOA Assistance shall not exceed the Budget (Attachment 11). In the event the SA portion of the project is not developed, the Developer shall construct only that portion of SA Development which shall be able to serve either the SA Development or a Phase IV of the SFD Development ("Base Infrastructure"). The cost of the Base Infrastructure shall then be transferred to the Phase IV Budget of the SFD Development (Attachment 16 to the SFD Development), the SA Budget (Attachment 11 to the SA Agreement), will be deleted and the SFD Budget will be increased by the Phase IV Budget, which in turn is also guaranteed by the Developer. Should actual costs exceed the Budget the overrun will be funded through reduced Developer Fee and ultimately through access to other resources of Developer. Since the exact outcome of the project and share of Cost Savings cannot be exactly projected at this time, Attachment 11 includes examples as to how the Developer's Fee (Overhead and Profit) will be calculated under different situations. Projections are also included in Attachment 11 to estimate the timing and amount of payments if the project cost experience and timing are exactly as budgeted and scheduled. B. [202] Conditions Precedent to the Transfer of the SA Site Prior to and as conditions to funding any portion of the SA Assistance, the Developer shall complete each of the following by the respective times established therefor in the Schedule of Performance (Attachment No. 4): 1. the Developer shall not be in default of this Agreement; 2. the Developer provides to the Executive Director insurance certificates conforming to Section 307 of this Agreement; 3 . the Developer shall have executed and deposited with escrow for delivery to the Agency the SA Note Promissory Note (Attachment No. 6) and the SA Deed of Trust (Attachment No. 7); 4. the Developer shall have executed and deposited with escrow for recordation and delivery to the Agency the Declaration of Conditions, Covenants and Restrictions (Attachment No. 8); 5. the Developer shall have provided evidence of their financing plan reasonably satisfactory to the Agency Executive Director sufficient to perform Developer's responsibilities for construction of the SA Development pursuant to this Agreement; and 6. the Developer has approved the environmental condition of the SA Site and agrees to acquire the SA Site in its present condition. The foregoing items numbered 1 to 6, inclusive, together constitute the "Conditions Precedent to the Agency funding of the acquisition portion of the Agency Assistance. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 13 55161 C. [203] Acquisition of the SA Site The Developer or its successor in interest or assignee shall acquire a fee simple marketable title to the SA Site pursuant to a Grant Deed in the form of Attachment No. 5 attached hereto and incorporated hereby by this reference. D. [204] Escrow The Developer agrees to open an escrow (the "Acquisition Escrow") with First American Title Insurance Co., or with another mutually agreeable escrow company (the "Escrow Agent"), prior to December 1, 1998. This Agreement constitutes the Agency's escrow instructions for the sale and acquisition of the SA Site and a duplicate original of this Agreement shall be delivered to the Escrow Agent upon the opening of the Acquisition Escrow. The Escrow Agent is hereby empowered to act under this Agreement, and the Escrow Agent, upon indicating within five (5) days after the opening of the Acquisition Escrow its acceptance of the provisions of this Section 204, in writing, delivered to the Agency and the Developer, shall carry out its duties as Escrow Agent hereunder. The Agency shall pay into the Acquisition Escrow the following fees, charges and costs promptly after the Escrow Agent has notified the Agency of the total amount of such fees, charges and costs, but not earlier than ten (10) days prior to the scheduled date for closing each Acquisition Escrow: 1. The Escrow fee; 2. Costs of drawing the grant deed; 3. Recording fees; 4. Notary fees; 5. The title insurance policy premiums; and 6. Any transfer tax and any state, county or city documentary stamps. The Developer shall deposit with the Escrow Agent the executed SA Promissory Note (Attachment No.6) and the SA Deed of Trust (Attachment No. 7). The Escrow Officer shall notify the Agency when all outstanding documents including the grant deed to the Developer or its assignee, the SA Deed of Trust (Attachment No. 7) and the Declaration of Conditions, Covenants and Restrictions (Attachment No. 8) have been executed and submitted to Escrow by the applicable party. The Escrow Agent is authorized to utilize the Agency funds provided for the above acquisition costs on the condition of the immediate recording of the SA Deed of Trust (Attachment No. 7) and the Declaration of Conditions, Covenants and Restrictions (Attachment No. 8) after recording of the Grant Deed (Attachment No. 5) vesting title in the Developer's or Developer's assignee's name, as applicable. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 14 55161 All funds received in the Acquisition Escrow shall be deposited by the Escrow Agent, with other escrow funds of the Escrow Agent in an interest -earning general escrow account or accounts with any State or national bank doing business in the State of California. Such funds may be transferred to any other general escrow account or accounts. All disbursements shall be made by check of the Escrow Agent. If the Acquisition Escrow has not closed within three (3) working days of the receipt by Escrow of the Agency funds then said funds shall be returned to the Agency unless written authorization to retain the funds is provided by the Agency Executive Director. Any amendment to these escrow instructions shall be in writing and signed by the Agency. At the time of any amendment, the Escrow Agent shall agree to carry out its duties as Escrow Agent under such amendment. The liability of the Escrow Agent in the capacity of escrow holder with respect to the Agency is limited to performance of the obligations imposed under it under this Section 204 of this Agreement. E. [205] [Intentionally Omitted] F. [206] Conveyance of Title and Delivery of Possession Provided that the Developer is not in default under this Agreement and all conditions precedent to such conveyance have occurred, and subject to any mutually agreed upon extensions of time, conveyance to the Developer of title to the SA Site shall be completed on or prior to commencement of construction unless otherwise agreed to by the Agency. The Agency and the Developer agree to perform all acts necessary to conveyance of title in sufficient time for title to be conveyed in accordance with the foregoing provisions. Possession shall be delivered to the Developer concurrently with the conveyance of title, except that limited access may be permitted before conveyance of title as permitted in Section 213 of this Agreement. The Developer shall accept title and possession on the said date. G. [207] Condition of Title The Agency shall convey to the Developer fee simple title to the SA Site free and clear of all recorded liens, encumbrances, encroachments, assessments, leases and taxes except as approved by Developer pursuant to this Section 207. Within five (5) days of execution of this Agreement, Agency shall cause First American Title Insurance Company, or another title company reasonably acceptable to Agency and Developer (the "Title Company"), to deliver to Developer a standard preliminary title report (the "Title Report") with respect to the SA Site, together with legible copies of the documents underlying the exceptions ("Exceptions") set forth in the Title Report. Developer shall have the right to reasonably approve or disapprove the Exceptions; provided, however, that the Developer hereby approves the Redevelopment Plan and the lien of current non -delinquent real property taxes and assessments, if any, as Exceptions. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 15 551a Developer shall have ten (10) days from the date of receipt of the Title Report and the Exceptions pursuant to this Section 207 to give written notice to Agency of its approval or disapproval of any of such Exceptions. Developer's failure to give written approval of the Title Report within such time limit shall be deemed approval of the Title Report by Developer. If Developer notifies Agency of its disapproval of any Exceptions in the Title Report, Agency shall have the right, but not the obligation, to remove any disapproved Exceptions within ten (10) days after receiving written notice of Developer's disapproval or provide assurances satisfactory to Developer that such Exception(s) will be removed on or before conveyance of the SA Site. If Agency cannot or in its sole discretion does not elect to remove any of the disapproved Exceptions within that period, Developer shall have ten (10) business days after the expiration of such ten (10) days to either give Agency written notice that it elects to proceed with the conveyance of the SA Site subject to the disapproved Exceptions or to give Agency written notice that it elects to terminate this Agreement. Developer shall have the right to approve or disapprove any Exceptions reported by the Title Company after Developer has approved the condition of title for the SA Site (which are not created by Developer). Agency shall not voluntarily create any new exceptions to title following the date of this Agreement. H. [208] Payment of the Purchase Price and Recordation of Deed The Developer shall deposit the SA Purchase Price including the executed SA Note and the SA Deed of Trust for the SFR Site and other sums required hereunder, if any, with the Escrow Agent prior to the date for conveyance of the SA Site, provided that the Escrow Agent shall have notified the Developer in writing that each grant deed, properly executed and acknowledged by the Agency, has been delivered to the Escrow Agent and that title is in condition to be conveyed in conformity with the provisions of Section 207 of this Agreement. Upon the' close of escrow, the Escrow Agent shall record the grant deed for recordation among the land records in the. Office of the County Recorder of Riverside County, shall deliver the purchase price and other required sums to the Agency. [209] Title Insurance Concurrently with recordation of the grant deed, First American Title Insurance Company or some other title insurance company satisfactory to the Agency and the Developer having equal or greater financial responsibility ("Title Company"), shall provide and deliver to the Developer a CLTA or ALTA title insurance policy issued by the Title Company insuring that the title is vested in the Developer, or its assignee, as applicable, in the condition required by Section 207 of this Agreement. The Title Company shall provide the Agency with a copy of the title insurance policy and the title insurance policy shall be in the amount of the purchase price for the SA Site. The Agency shall pay the title insurance premium attributable to a CLTA standard form policy of title insurance in the amount of the purchase price of the SA Site. The Title Company shall, if requested by the Developer, increase the amount of the title insurance policy or provide the Developer with an endorsement to insure the amount of the Developer's estimated development costs of the improvements to be constructed upon the SA Site. The Developer shall pay the entire premium for any such increase in coverage requested by it. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 16 IZ161 J. [210] Taxes and Assessments Ad valorem taxes and assessments, if any, on the SA Site, and taxes upon this Agreement or any rights hereunder, levied, assessed or imposed for any period commencing prior to conveyance of title shall be borne by the Agency. All ad valorem taxes and assessments levied or imposed for any period commencing after closing of escrow for the SA Site shall be paid by the Developer. K. [211 ] Conveyance Free of Possession Except as otherwise provided in the Scope of Development (Attachment No. 3), the SA Site shall be conveyed free of any possession or right of possession by any person except that of the Developer and the easements of record. L. [212] Inspections. Condition of SA Site 1. Inspections. The Developer shall conduct the Developer's own investigation of the SA Site, including but not limited to the existing improvements, if any, its physical condition, the soils and toxic conditions of the SA Site and all other matters which in the Developer's judgment affect or influence the Developer's proposed use of the SA Site and the Developer's willingness to develop the SA Site pursuant to this Agreement. The Developer's investigation may include, without limitation, the preparation by a duly licensed soils engineer of a soils report for the SA Site. Within the time set forth therefor in the Schedule of Performance (Attachment No. 4), the Developer shall provide written notice to the Agency of the Developer's determinations concerning the suitability of the physical condition of the SA Site. If, in the Developer's reasonable judgment, the physical condition of the SA Site is unsuitable for the use or uses to which the SA Site will be put to the extent that it is not economically feasible for the Developer to develop the SA Site pursuant to this Agreement, then the Developer shall have the option either to (a) take any action necessary to place the applicable Site in a condition suitable for development, at no cost to the Agency; or (b) terminate this Agreement pursuant to the provisions of Section 511 hereof with respect to the SA Site. If the Developer has not notified the Agency of its determinations concerning the suitability of the physical condition of the SA Site within the time set forth in the Schedule of Performance (Attachment No. 4), the Developer shall be deemed to have waived its right to terminate this Agreement pursuant to this Section. 2. "As Is". The Agency has provided the Developer with all information of which it has actual knowledge concerning the physical condition of the SA Site, including, without limitation, information about any Hazardous Materials, as defined below. The Developer acknowledges and agrees that any portion of the SA Site, including but not limited to the existing improvements that it acquires from the Agency pursuant to this Agreement shall be purchased "as is," in its current physical condition, with no warranties, express or implied, as to the physical condition thereof, the presence or absence of any latent or patent condition thereon or therein, including, without limitation, any Hazardous materials thereon or therein, and any other matters affecting the SA Site. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 17 55161 3. Indemnity. The Developer agrees, from and after the date of recording of the deed conveying title to the SA Site from the Agency to the Developer or its assignee under this Agreement, to defend, indemnify, protect and hold harmless the Agency and its officers, beneficiaries, employees, agents, attorneys, representatives, legal successors and assigns ("Indemnities") from, regarding and against any and all liabilities, obligations, orders, decrees, judgments, liens, demands, actions, Environmental Response Actions (as defined in subsection 5 below), claims, losses, damages, fines, penalties, expenses, Environmental Response Costs (as defined herein) or costs of any kind or nature whatsoever, together with fees (including, without limitation, reasonable attorneys' fees and experts' and consultants' fees), occurring during and caused by Developer's use and occupancy of the SA Site, and resulting from or in connection with the actual or claimed generation, storage, handling, transportation, use, presence, placement, migration and/or release of Hazardous Materials (as defined in subsection 5 below), at, on, in, beneath or from the SA Site, unless caused by the negligence or willful misconduct of Indemnitees. The Developer's defense, indemnification, protection and hold harmless obligations herein shall include, without limitation, the duty to respond to any governmental inquiry, investigation, claim or demand regarding the Hazardous Materials, at the Developer's sole cost. Developer shall have no liability under this Section 2.12(3) for any Environmental Response costs, Hazardous Materials or any other matter to be indemnified hereunder occurring after the sale or transfer of the completed SA Development in accordance with the terms of this Agreement. 4. Release and Waiver. Subject to the exceptions set forth in Section 212(3) above, the Developer hereby releases and waives all rights, causes of action and claims the Developer has or may have in the future against the Indemnities arising out of or in connection with any Hazardous Materials (as defined subsection 5 below), at, on, in, beneath or from the SA Site. In furtherance of the intentions set forth herein, the Developer acknowledges that it is familiar with Section 1542 of the Civil Code of the State of California which provides as follows: "A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected this settlement with the debtor." The Developer hereby waives and relinquishes any right or benefit which it has or may have under Section 1542 of the Civil Code of the State of California or any similar provision of the statutory or nonstatutory law of any other applicable jurisdiction to the full extent that it may lawfully waive all such rights and benefits pertaining to the subject matter of this Section 212. 5. Definitions. (a) As used in this Agreement, the term "Environmental Response Actions" means any and all activities, data compilations, preparation of studies or reports, interaction with environmental regulatory agencies, obligations and undertakings associated with environmental investigations, removal activities, remediation activities or responses to inquiries and notice letters, as may be sought, initiated or required in connection with any local, state or federal governmental or private party claims, including any claims by the Developer. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 18 55161 (b) As used in this Agreement, the term "Environmental Response Costs" means any and all costs associated with Environmental Response Actions including, without limitation, any and all fines, penalties and damages. (c) As used in this Agreement, the term "Hazardous Materials" means any substance, material or waste which is (1) defined as a "hazardous waste," "hazardous material," "hazardous substance," "extremely hazardous waste," or "restricted hazardous waste" under any provision of California law; (2) petroleum; (3) asbestos; (4) polychlorinated biphenyls; (5) radioactive.materials; (6) designated as a "hazardous substance" pursuant to Section 311 of the Clean Water Act, 33 U.S.C. Section 1251 et seq. (33 U.S.C. Section 1321)or listed pursuant to Section 307 of the Clean Water Act (33 U.S.C. Section 1317); (7) defined as a "hazardous substance" pursuant to the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq. (42 U.S.C. Section 6903) or its implementing regulations; (8) defined as a "hazardous substance" pursuant to Section 101 of the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. Section 9601 et seq. (42 U.S.C. Section 96.01); or (9) determined by California, federal or local governmental authority to be capable of posing a risk of injury to health, safety or property. 6. Materiality. The Developer acknowledges and agrees that the defense, indemnification, protection and hold harmless obligations of the Developer for the benefit of the Agency set forth in this Agreement are a material element of the consideration to the Agency for the performance of its obligations under this Agreement, and that the Agency would not have entered this Agreement unless the Developer's obligations were as provided for herein. 7. Right to Contest. Developer may contest in good faith any claim, demand, levy or assessment under Hazardous Materials Laws if. (a) the contest is based on a material question of law or fact raised by Developer in good faith, (b) Developer promptly commences and thereafter diligently pursues the contest, (c) the contest will not materially impair the taking of any remedial action with respect to such claim, demand, levy or assessment, and (d) if requested by Agency, Developer deposits with Agency any funds or other forms of assurance Agency in good faith from time to time determines appropriate to protect Agency in good faith from the consequences of the contest being unsuccessful and any remedial action then reasonably necessary. No default shall be deemed to exist with respect to any. claim, demand, levy or attachment being contested by Developer under the conditions of this section. M. [213] Preliminary Work by the Developer Prior to the conveyance of title from the Agency, representatives of the Developer shall have the right of access to the SA Site at all reasonable times for the purpose of obtaining data and making surveys and tests necessary to carry out this Agreement. The Developer shall hold the Agency harmless for any injury or damages arising out of any activity pursuant to this section. The Developer shall have access to all data and information on the $A Site available to the Agency, but without warranty or representation by the Agency as to the completeness, correctness or validity of such data and information. Any preliminary work undertaken on the SA Site by the Developer prior to conveyance of title thereto shall be done only after written consent of the Agency and at the sole expense of the Developer. The Developer shall save and protect the Agency against any claims resulting from such preliminary work, access or use of the SA Site by Developer, its agents or contractors. Copies of CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 19 55161 data, surveys and tests obtained or made by the Developer on the SA Site shall be filed with the Agency. Any preliminary work by the Developer shall be undertaken only after securing any necessary permits from the appropriate governmental agencies. N. [214] Submission of Evidence of Equity Capital and Mortgage Financier for the SA Development The Developer is seeking either an allocation of tax credits from the California Tax Credit Allocation Committee (for State and federal 9% low income housing tax credits) which will be sold to a tax credit investor, or a capital advance under the Section 202 Program from the U.S. Department of Housing and Urban Development ("HUD") (jointly, the "Government Equity") for the SA Development. In addition to Agency assistance proposed to be provided to the Developer as set forth in Sections 200 and 201 hereof, the development of the SA Development depends upon obtaining both Government Equity and conventional equity or mortgage financing necessary for the development and construction of the SA Development (the "Developer Financing"). The Government Equity is subject to specific competitive funding cycles. No later than the time specified in the Schedule of Performance (Attachment No. 4), the Developer shall submit to the Agency evidence satisfactory to the Agency that the Developer has obtained a preliminary tax credit reservation or conditional commitment for the Government Equity and a commitment for the Developer Financing; however, in recognition of the existence of competitive funding cycles, the Developer's submission of evidence of both Government Equity and Developer Financing may be extended by the Agency Executive Director, at the Executive Director's sole discretion, for two (2) consecutive six (6) month periods. If the Developer, after a good faith effort to obtain the Government Equity is not able to submit evidence of both Government Equity and Developer Financing to the Agency satisfactory to the Agency, within the time period set forth in the Schedule of Performance (Attachment No. 4), the Parties agree that the SA Development shall be developed as an additional phase or two phases of the SFR Development. The parties recognize that prior to a conversion of SFR Development, the Developer would first need to obtain amendments to the specific plan and other appropriate planning documents from the City. O. [215] Disbursement of Agency Assistance for SA Improvements. 1. Deposit of Agency Assistance. The portion of Agency Assistance to be utilized for reimbursement of construction costs according to the schedule set out in the Scope of Development (Attachment No. 3) shall be deposited in an interest bearing account to be designated by the Agency in the name of the Agency ("Agency Account") and funds shall be disbursed from the Agency Account upon the signature of the Executive Director or Finance Director, acting alone, for the purposes set forth in this Agreement pursuant to the disbursement procedures set forth in this Section 215. The amount to be deposited in this account shall be equal to $1,976,160. For purposes of calculating tax basis, in addition to this $1,976,160, the $250,000 cost referenced in Section 201 paragraph 2 for infrastructure improvements, shall be included in the total project costs. The Application for disbursement shall be submitted to the Executive Director of the Agency for review and approval in accordance with this Section 215. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 20 55161 2. Initial Disbursements. Agency shall make disbursements of the SA Assistance following approval of this Agreement and prior to the commencement of the construction of the SA Improvements contemplated by the Scope of Development ("Initial Disbursements") only for previously incurred development costs and fees approved by Agency and set forth on the Budget (Attachment No. 11). 3. Conditions for Each Disbursement. Prior to each and every disbursement, the following conditions shall be satisfied: (a) Application. Developer shall have delivered the Application attached hereto as Attachment No. 10 to the Executive Director at least fifteen (15) business days prior to the requested disbursement. The Application shall be completed and certified to be accurate by Developer. The Application shall specifically identify the nature of each expense, by reference to items in the Budget, and shall identify the status of completion of such construction. (b) Approval of Application. The Executive Director shall have reviewed and approved the Application and accompanying documents, and the Executive Director shall have determined that the work is within the scope of the applicable section of the Budget within ten (10) business days. The Executive Director shall advise Developer of any issues within the ten (10) day period and shall pay all uncontested amounts requested by the Application within twenty (20)days or the receipt of the Application. (c) Lien Waivers. Agency shall have received appropriate waivers of mechanics' and materialmen's lien rights and stop notice rights executed by all contractors and other persons rendering services or delivering materials covered by the requests made in the Application. (d) Budget Reallocation. If, in Developer's reasonable discretion, Developer will not fully utilize the amount allocated for any particular item in the Budget, then the excess may be reallocated to another item or items in the Budget, as Developer may request. Any reallocation from the general categories listed in Attachment 11 shall require approval from the Agency Director. (e) Amount: Frequency. Agency shall not be obligated to make disbursements more frequently than once per month. (f) Use of Disbursements. Developer shall use or apply all SA Assistance solely for reimbursement or payment of the items described in the Application pursuant to which the disbursement was made. 4. Overhead Pam. Developer shall be entitled to receive an overhead payment of $30,000 of the total $540,376 allocated for overhead pursuant to the Budget as part of the Initial Disbursements under Subsection 2 above. Of the remainder, $11,000 per month shall be paid out over a period of seven (7) months during the period of construction of Base Infrastructure. The balance, $433,376, shall be disbursed at a rate of $24,077 per month for no longer than 18 months once Developer commences construction of the balance of the SA Development. If a Phase IV of SFR housing is developed, the overhead for the Phase IV shall be $333,567. After CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 21 55161 construction of Base Infrastructure $226,567 will remain to be paid for overhead. Said $226,567 shall be paid on a prorata basis during the period of construction of Phase IV in amounts subject to the approval of the Agency Executive Director. 5. Monthly Reports. Developer shall cause to be delivered to Agency prior to the first day of the following month a monthly report which shall set forth a summary of the Budget, force majeure delays, an update of the construction schedule and any other material matters relating to the completion of the SA Development. III. [300] DEVELOPMENT OF THE SITE A. [301] Development of the SA Site 1. [302] Scope of Development The SA Site shall be developed as 118 units of senior apartments for low, very low income and moderate individuals or as a fourth phase (approximately 45 detached single-family housing units) of the SFR Development in the event Developer is unable, after good faith efforts, to obtain tax credit allocation for the SA Development' as more particularly described in the Scope of Development (Attachment No. 3). The development of the SA Site shall include both public improvements and private improvements on the SA Site and off -site public improvements required in the normal course of City's review of the development. The improvements to be constructed on the SA Site pursuant to this Agreement with the SA Assistance are referred to as the "SA Improvements". Developer has agreed to submit a minimum of three applications to the California Tax Credit Allocation Committee ("TCAC") for competitive state and federal 9% tax credits in the first three allocation rounds which occur after the date of this Agreement as may be necessary to secure an allocation of state and federal 9% tax credits for the SA Development. In the event Developer is unable to obtain a tax credit allocation for the SA Development after three allocation rounds pursuant to the SA Agreement, a fourth phase (approximately 45 additional single-family housing units) shall be added to the SFR Development as provided in the Scope of Development (Attachment No. 3) and the Agency Assistance for the SFR Development shall be increased as provided in Section 201 above and Section 201 of the SFR Agreement. The Developer shall commence and complete construction of the SA Improvements for the SA Site by the respective times established therefor in the Schedule of Performance (Attachment No. 4). The Scope of Development (Attachment No. 3) shall include any plans and specifications submitted to the City and/or Agency for approval, and shall incorporate or show compliance with all mitigation measures. 2. [303] Site Plan By the time set forth therefor in the applicable Schedule of Performance (Attachment No. 4), the Developer shall prepare and submit to the City for its approval a Site Plan and related CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 22 55161 documents which conform to the approved Specific Plan for Village on the Green and the requirements of the City and which contain the overall plan for development of the SA Site in sufficient detail to enable the City to evaluate the proposal for conformity to the requirements of the La Quints Municipal Code and this Agreement. The SA Site shall be developed as established in this Agreement and such documents, except as changes may be mutually agreed upon between the Developer and the Agency. Any such changes shall be within the limitations of the Scope of Development (Attachment No. 3). The landscaping and finish grading plans shall be prepared by a professional landscape architect or registered civil engineer who may be the same firm as the Developer's architect or civil engineer. During the preparation of all drawings and plans, staff of the City and the Agency and the Developer shall hold regular progress meetings to coordinate the preparation of, submission to, and review of drawings, plans and related documents by the City. The staff of City and the Agency and the Developer shall communicate and consult informally as frequently as is necessary to insure that the formal submittal of any documents to the Agency can receive prompt consideration. 3. [304] Review and Approval of Plans. Drawings. and Related Documents The Agency and the City shall have the right to review and approve all plans and drawings which may be required by the City with respect to any permits and entitlements which are required to be obtained to develop the SA Improvements, including any changes therein. During each stage of the processing of plans for the SA Improvements, the Agency and the City shall have the right to require additional information and shall advise the Developer if any submittal of plans or drawings is not complete or not in accordance with City/Agency procedures. If the Agency or the City determines that such a submittal is not complete or not in accordance with procedures, such tender shall not be deemed to constitute a submittal for purposes of satisfying the Schedule of Performance (Attachment No. 4); provided, however, Agency or City, as applicable, shall provide Developer with a detailed written report of any such deficiency or noncompliance with procedures and Developer shall revise and resubmit such plans in accordance with the Schedule of Performance and such written report. If the Developer desires to make any substantial changes in the construction plans for the SA Improvements after their approval by the Agency and the City, the Developer shall submit the proposed change to the Agency and the City for their approval. If the construction plans, as modified by the proposed change, conform to the requirements of this Section 304 and the Scope of Development (Attachment No. 3), the Agency and the City will approve the proposed change and notify the Developer in writing within thirty (30) days after submission to the Agency and the City: 4. [305] Cost of Development With the exception of the Agency Assistance as set forth in Section 201 of this Agreement, all costs for planning, designing, and constructing the Improvements shall be borne exclusively by the Developer. The Developer shall also bear all costs related to discharging the CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 23 55161 duties of the Developer set forth in this Agreement. The Developer assumes the responsibility to construct, and shall let contracts for or cause to be constructed, all off -site public improvements directly adjacent to the SA Site relating to 48th Avenue and Jefferson Street pursuant to the terms of this Agreement (as set forth in the Budget), substantially in conformity with procedures used by the Agency when competitive bidding is deemed to be required. The Developer shall be responsible for any non -City fees associated with the development of the SA Site which are not included within the Budget. 5. [306] Construction Schedule The Developer shall commence and complete the SA Improvements by the respective times established therefor in the Schedule of Performance (Attachment No. 4). 6. [307] Indemnity. Bodily Injury and Property Damage Insurance The Developer shall defend, assume all responsibility for and hold the Agency and the City, and their respective officers, agents and employees, harmless from all claims or suits for, and damages to, property and injuries to persons, including accidental death (including attorneys fees and costs), which may be caused by any of the Developer's activities under this Agreement. The Developer shall take out and maintain during the life of this Agreement a comprehensive liability policy in the amount of One Million Dollars ($1,000,000) combined single limit policy, [including contractual liability,] as shall protect the Developer, the City, and the Agency from claims for such damages. Coverage shall be primary and not -contributing with any policy or coverage maintained by or obtained by the Agency, and an appropriate endorsement shall so state. The policy shall contain a waiver of subrogation. Insurance coverage furnished by the Developer pursuant to this Section 307 shall conform to this Section 307 and shall pertain to all activities on the Site and adjacent public rights -of -way surrounding the SA Site and all work on off -site public improvements. Developer shall furnish or cause to be furnished to the Agency a certificate of insurance from the insurer evidencing compliance with this Section 307 and providing that the insurer shall not change or modify the policy without thirty (30) days' prior written notice to Agency. In the alternative, Developer may show proof of a certificate of consent to self -insure issued by the Director of Industrial Relations according to California Labor Code Section 3800. Developer additionally agrees to and shall save the Agency and the City and their officers, employees and agents harmless from and assume all responsibility for any and all liability or responsibility for damage, costs, losses, or suit arising in any manner from the approval of this Agreement or the development and activities conducted by Developer or its agents pursuant this Agreement. This obligation and indemnification shall constitute a covenant running with the land throughout the life of the Redevelopment Plan. 7. [308] City and Other Governmental Agency Permits Before commencement of construction or development of any buildings, structures or other works of improvement upon the SA Site or in connection with any off -site improvement, the Developer shall, at its own expense, secure or cause to be secured any and al permits which may CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 24 55161 be required by the City or any other governmental agent affected by such construction, development or work. It is understood that the Developer's obligation is to pay all necessary fees and to timely submit to the City final drawings with final corrections to obtain building permit; the Agency will, without obligation to incur liability or expense therefor, use its best efforts to expedite issuance of building permits and certificates of occupancy for construction that meet the requirements of the City Code. 8. [309] Rights of Access For purpose of assuring compliance with this Agreement, representatives of the Agency and the City shall have the right of access to the SA Site without charges or fees, at normal business hours during the period of this Agreement for the purposes of this Agreement, including, but not limited to, the inspection of the work being performed in constructing the Improvements, so long as they comply with all safety rules. Such representatives of the Agency or of the City shall be those who are so identified in writing by the Executive Director of the Agency. The Agency shall hold the Developer harmless from any bodily injury or related damages arising out of the activities of the Agency and the City as referred to in this Section 309. 9. [310] Local. State and Federal Laws The Developer shall perform under this Agreement and carry out its performance under this Agreement, including without limitation the construction of the Improvements, in conformity with all applicable federal and state laws and local ordinances, including all applicable federal and state labor standards, as to the SA Site, provided, however, Developer and its contractors, successors, assigns, transferees, and lessees are not waiving their rights to contest any such laws, rules or standards. 10. [311 ] Anti -Discrimination Pursuant to Section 33435 and 33050 of the California Community Redevelopment Law, the Developer for itself and its successors and assigns, agrees, that in the construction of SA Improvements on the SA Site or other performance under this Agreement, the Developer will not discriminate against any employee or applicant for employment because of sex, marital status, race, color, religion, ancestry, or national origin. 11. [312] Taxes and Assessments After the conveyance of title by Agency to Developers or its assignee, the Developer shall pay prior to delinquency all real estate taxes and assessments on the SA Site for any period subsequent to the conveyance of title and possession, so long as the Developer retains any ownership interest therein. The Developer shall remove or have removed any levy or attachment made on the SA Site or any part thereof, or assure the satisfaction thereof within a reasonable time but in any event prior to any sale or transfer of all or any portions thereof. Notwithstanding the above, the Developer shall have the right to contest the validity or amounts of any tax, assessment, or encumbrance available. to the Developer in respect thereto, and nothing herein shall limit the remedies available to the Developer in respect thereto. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 25 S51a B. [313] Prohibition Against Transfer of the SA Site, the Buildings or Structures Thereon and Assignment of Agreement The Developer shall not, except as may be expressly permitted by this Agreement, without prior approval of the Agency, make any total or partial sale, transfer, conveyance of, or enter into any assignment or ground lease of or refinance the whole or any part of the SA Site or of the buildings or structures on the SA Site. This prohibition shall not be deemed to prevent the granting of temporary or permanent easements or permits to facilitate the development of the SA Site. C. [314] Right of the Agency to Satisfy Other Liens on the SA Site After Title Passes After the conveyance of title by Agency and prior to the completion of construction, and after the Developer has had written notice and has failed after a reasonable time, but in any event not less than forty-five (45) days, to challenge, cure, adequately bond against, or satisfy any liens or encumbrances on the SA Site which are not otherwise permitted under this Agreement, the Agency shall have the right but no obligation to satisfy any such liens or encumbrances. Notwithstanding the above, the Developer shall have the right to contest the validity or amounts of any tax, assessment, or encumbrance available to the Developer in respect thereto. D. [315] Certificate of Completion Promptly after the completion of the SA Improvements in conformity with this Agreement (as determined by the Executive Director of the Agency), upon the written request of the Developer the Agency shall furnish the Developer with the Certificate of Completion (in the form attached hereto as Attachment No. 9) which evidences and determines the satisfactory completion of the construction, and development of the SA Improvements, pursuant to the provisions and covenants specified in this Agreement, the Redevelopment Plan and the California Community Redevelopment Law. The issuance and recordation of a Certificate of Completion (Attachment No. 9) with respect to the SA Improvements shall not supersede, cancel, amend or limit the continued effectiveness of any obligations relating to the maintenance, or uses, or payment of monies, or any other obligations, except for the obligation to complete construction of the SA Improvements as of the time of the issuance of such applicable certificate in accordance with the requirements of this Agreement. The Agency shall not unreasonably withhold any Certificate of Completion. If the Agency refuses or fails to furnish a Certificate of Completion after written request from the Developer, the Agency shall, within ten (10) days of the written request, provide the Developer with a written statement of the reasons the Agency refused or failed to furnish such Certificate of Completion. The statement shall also contain the Agency's opinion of the action the Developer must take to obtain the Certificate of Completion. Upon issuance of a Certificate of Completion (Attachment No. 9) for the SA Improvements, construction of the SA Improvements shall be deemed to have been completed in conformity with this Agreement. The Certificate of Completion (Attachment No. 9) is not a notice of completion as referred to in Section 3093 of the California Civil Code. The issuance of a Certificate of Completion shall not affect the continued effectiveness of the Declaration of Conditions, Covenants and Restrictions (Attachment No. 8) recorded pursuant to this Agreement. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 26 55161 E. [316] No Encumbrances Except Mortgages. Deeds of Trust. Sales and Leases -Back or Other Financing for Development Notwithstanding any prohibition in this Agreement, mortgages, deeds of trust, sales and leases -back or any other form of conveyance required for any reasonable method of financing are permitted before issuance of a Certificate of Completion but only for the purpose of securing loans of funds to be used for financing the acquisition of the SA Site, the construction of improvements of the SA Site and any other expenditures necessary and appropriate to develop the SA Site under this Agreement. The Developer shall notify the Agency in advance of any mortgage, deed of trust, sale and lease -back or other form of conveyance for financing if the Developer proposes to enter into the same before issuance of a Certificate of Completion. The Developer shall not enter into any such conveyance for financing without the prior written approval of the Agency, which approval the Agency agrees to give if any such conveyance is given to a responsible financial or lending institution or other acceptable person or entity. Such lender shall be deemed approved unless rejected in writing by the Agency within ten (10) days after notice thereof to the Agency by the Developer. In any event, the Developer shall promptly notify the Agency of any mortgage, deed of trust, sale and lease -back or other financing conveyance, encumbrance or lien that has been created or attached thereto prior to completion of the construction of the improvements on the SA Site whether by voluntary act of the Developer or otherwise. The words "mortgage" and "deed of trust," as used herein, include all other appropriate modes of financing real estate acquisition, construction and land development. The Agency agrees to subordinate this Agreement, the SA Deed of Trust and the Declaration of Conditions, Covenants and Restrictions to the lien of such mortgage or deed of trust pursuant to a subordination agreement in form and substance reasonably acceptable to the holder of the mortgage or deed of trust and the Agency. F. [317] Holder Not Obligated to Construct Improvements The holder of any mortgage, deed of trust or other security interest authorized by this Agreement shall in no way be obligated by the provisions of this Agreement to construct or complete the Improvements or to guarantee such construction or completion, nor shall any covenant or any other provision in the grant deed for the SA Site be construed so to obligate such holder. Nothing in this Agreement shall be deemed to construe, permit or authorize any such holder to devote the SA -Site to any uses or to construct any improvements thereon other than those uses or improvements provided for or authorized by this Agreement. G. [318] Notice of Default to Mortgage. Deed of Trust or Other Security Interest Holders: Right to Cure Whenever the Agency shall deliver any notice or demand to the Developer with respect to any breach or default by the Developer in completion of construction of the SA Improvements, the Agency shall at the same time deliver a copy of such notice or demand to each holder or record of any mortgage, deed of trust or other security interest authorized by this Agreement who has previously made a written request to the Agency therefor. Each such holder shall (insofar as the rights of the Agency are concerned) have the right, at its option, within ninety (90) days after the receipt of the notice, to cure or remedy or commence to cure or remedy any such default and to add the cost thereof to the security interest debt and the lien on its security interest. In the event there is more than one such holder, the right to cure or remedy a breach or default of the Developer under CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 27 55161 this Section 318 shall be exercised by the holder first in priority or as the holders may otherwise agree among themselves, but there shall be only one exercise of such right to cure and remedy a breach or default of the Developer under this Section 318. Nothing contained in this Agreement shall be deemed to permit or authorize such holder to undertake or continue the construction or completion of the SA Improvements (beyond the extent necessary to conserve or protect the improvements or construction already made) without first having expressly assumed the Developer's obligations to the Agency by written agreement satisfactory to the Agency. The holder in that event must agree to complete, in the manner provided in this Agreement, the SA Improvements to which the lien or title of such holder relates and submit evidence satisfactory to the Agency that it has the qualifications and financial responsibility necessary to perform such obligations. Any such holder properly completing the SA Improvements shall be entitled, upon written request made to the Agency, to a Certificate of Completion from the Agency. H. [319] Failure of Holder to Complete Improvements In any case where, six (6) months after default by the Developer in completion of construction of the SA Improvements under this Agreement, the holder of any mortgage, deed of trust or other security interest creating a lien or encumbrance upon the SA Site has not exercised the option to construct, or if it has exercised the option and has not proceeded diligently with construction, the Agency may purchase the mortgage, deed of trust or other security interest by payment to the holder of the amount of the unpaid debt, plus any accrued and unpaid interest. If the ownership of the SA Site has vested in the holder, the Agency, if it so desires, shall be entitled to a conveyance of the SA Site from the holder to the Agency upon payment to the holder of an amount equal to the sum of the following: (a) The unpaid mortgage, deed of trust or other security interest debt at the time title became vested in the holder (less all appropriate credits, including those resulting from collection and application of rentals and other income received during foreclosure proceedings); (b) All expenses with respect to foreclosure; (c) The net expenses, if any (exclusive of general overhead), incurred by the holder as a direct result of the subsequent management of the SA Site; (d) The costs of any authorized improvements made by such holder; and (e) An amount equivalent to the interest that would have accrued on the aggregate of such amounts had all such amounts become part of the mortgage or deed of trust debt and such debt had continued in existence to the date of payment by the Agency. I. [320] Right of Agency to Cure Mortgage. Deed of Trust or Other Security Interest Default In the event of a default or breach by the Developer of a mortgage, deed of trust or other security interest with respect to the SA Site prior to the completion of the SA Improvements, and the holder has not exercised its option to complete the SA' Improvements, the Agency may cure the CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 28 S5161 default prior to completion of any foreclosure. In such event, the Agency shall be entitled to reimbursement from the Developer of all costs and expenses incurred by the Agency in curing the default. The Agency shall also be entitled to a lien upon the SA Site to the extent of such costs and disbursements. Any such lien shall be subject to mortgages, deeds of trust or other security interests executed for the sole purpose of obtaining funds to purchase and develop the SA Site as authorized herein. IV. [400] USE OF THE SITE A. [401 ] Affordable Housing 1. Number of Units Developer shall develop the SA Development consisting of up to 118 senior apartments on the SA Site and shall develop all on -site and off -site public improvements connected therewith, all as described and set forth in the Scope of Development (Attachment No. 3). Developer shall restrict the leases of the SA Development units to Very Low, or Low Income Households pursuant to the applicable income and affordability provisions contained herein. The Developer further covenants and agrees that the above -referenced occupancy, SA affordability requirements shall bind and be enforceable against the SA Site for the period of a minimum of thirty (30) years commencing with the acquisition of the SA Site by the Developer with the simultaneous recording of the Conditions, Covenants and Restrictions (Attachment No. 8). (a) "AP Affordable Rental Costs" shall mean that rent which shall not exceed the percentage of the gross income of the occupant person or household established by regulations of the department which shall not be less than fifteen percent (15 %) of gross income nor exceed thirty percent (30%) of gross income, adjusted for family size and a utility allowance. (b) "Low Income Household" shall mean a household earning not greater than eighty percent (80 %) of Riverside County median income, as determined by the United States Department of Housing and Urban Development from time to time, as set forth in Health and Safety Code Section 50105. (c) "Very Low Income Household" shall mean a household earning not greater than fifty percent (50%) of Riverside County median income, as determined by the United States Department of Housing and Urban Development from time to time, as set forth in Health and Safety Code Section 50105. B. [402] Uses In Accordance with Redevelopment Plan, Nondiscrimination The Developer covenants and agrees for itself, its successors, its assigns, and every successor in interest to the SA Site or any part thereof that the Developer and such successors and assignees, shall devote the SA Site to the uses specified in the Redevelopment Plan, the Grant Deed (Attachment No. 5), the Declaration of Conditions, Covenants and Restrictions (Attachment No. 8) and this Agreement for the periods of time specified therein. The foregoing covenants shall run with the land. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 29 The Developer covenants by and for itself and any successors in interest that there shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Site, nor shall the Developer itself or any person claiming under or though it 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, sublessees or vendees of the SA Site. The foregoing covenants shall run with the land. The Developer shall refrain from restricting the rental, sale or lease of the property on the basis of race, color, creed, religion, sex, marital status, national origin or ancestry of any person. All such deeds, leases or contracts shall contain or be subject to substantially the following nondiscrimination or nonsegregation clauses: I . In deeds: "The grantee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through his or her heirs, executors, administrators and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the grantee himself or herself or any person claiming under or though him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the land herein conveyed. The foregoing covenants shall run with the land." 2. In leases: "The lessee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through him or her, and this lease is made and accepted upon and subject to the following conditions: "There shall be no discrimination against or segregation or any person or group of persons or account of race, color, creed, religion, sex, marital status, ancestry or national origin in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the premises herein leased nor shall the lessee himself or herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, sublessees, subtenants or vendees in the premises herein leased." 3. In contracts: "There shall be no discrimination against or segregation of, any person, or group of persons on account of race, color, creed, religion, sex, marital status, ancestry or national origin, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the premises, nor shall the transferee himself or herself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the premises." CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 30 55161 The covenants established in this Agreement and the deeds of conveyance for the Site shall, without regard to technical classification and designation, be binding for the benefit and in favor of the Agency, its successors and assigns, the City and any successor in interest to the Sits, together with any property acquired by the Developer pursuant to this Agreement, or any part thereof. The covenants against racial discrimination shall remain in effect in perpetuity. C. [403] Effect of Violation of the Terms and Provisions of this Agreement After Collection of Construction The Agency is deemed the beneficiary of the terms and provisions of this Agreement and of the covenants running with the land, for and in its own rights and for the purposes of protecting the interests of the community and other parties, public or private, in whose favor and for whose benefit this Agreement and the covenants running with the land have been provided. The Agreement and the covenants shall run in favor of the Agency, without regard to whether the Agency has been, remains or is an owner of any land or interest therein in the SA Site or in the Project Area. The Agency shall have the right, if this Agreement or covenants are breached, to exercise all rights and remedies, and to maintain any actions or suites at law or in equity or other property proceedings to enforce the curing of such breaches to which it or any other beneficiaries of this Agreement and covenants may be entitled. D. [404] Maintenance of the SA Site The Developer shall maintain the SA Improvements on the Site in conformity with the La Quinta Municipal Code and the requirements of the Declaration of Conditions, Covenants and Restrictions (Attachment No. 8), and shall keep the SA Site free from any accumulation of debris or waste materials. The Developer shall also maintain the landscaping required to be planted under the Scope of Development (Attachment No. 3) in a healthy and attractive condition. If, at any time, Developer fails to maintain the SA Site or any portion thereof, and said condition is not corrected as soon as reasonably possible after written notice from the Agency, either the Agency or the City may perform the necessary maintenance and Developer shall pay such costs as are reasonably incurred for such maintenance. V. [500] DEFAULTS AND REMEDIES A. [501] Defaults -- General Subject to the extensions of time set forth in Section 603, failure or delay by either party to perform any term or provision of this Agreement constitutes a default under this Agreement. A party claiming a default shall give written notice of default to the other party, specifying the default complained of and the actions required to correct such default. Except as otherwise expressly provided in Sections 508 and 509 of this Agreement, the claimant shall not institute proceedings against the other party if the other party within thirty (30) days from receipt of such notice immediately, with due diligence, commences to cure, correct or remedy such failure or delay and shall complete such cure, correction or remedy as soon as reasonably practicable after receipt of such notice. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 31 55161 B. [502] Legal Actions [503] Institution of Legal Actions In addition to any other rights or remedies and subject to the restrictions in Section 501, either party may institute legal action to seek specific performance of the terms of this Agreement, or to cure, correct or remedy any default, to recover damages for any default, or to obtain any other legal or equitable remedy consistent with the purpose of this Agreement. Such legal actions must be instituted in the Superior Court of the County of Riverside, State of California, in an appropriate municipal court in that county, or in the Federal District Court in the Central District of California. 2. [504] Applicable Law The laws of the State of California shall govern the interpretation and enforcement of this Agreement. 3. [505] Acceptance of Service of Process In the event that any legal action is commenced by the Developer against the Agency, service of process on the Agency shall be made by personal service upon the Executive Director or in such other manner as may be provided by law. In the event that any legal action is commenced by the Agency against the Developer, service of process on the Developer shall be made by personal service upon any officer or director of the Developer and shall be valid whether made with in or without the State of California or in such other manner as may be provided by law. C. [506] Rights and Remedies Are Cumulative Except as otherwise expressly stated in this Agreement, the rights and remedies of the parties are cumulative, and the exercise by either party of one or more of such rights or remedies shall not preclude the exercise by it' at the same or different times, of any other rights or remedies for the same default or any other default by the other party. D. [507] Inaction Not a Waiver of Default Any failures or delays by either party in asserting any of its rights and remedies as to any default shall not operate as a waiver of any default or of any such rights or remedies, or deprive either such party of its right to institute and maintain any actions or proceedings which it may deem necessary to protect, assert or enforce any such rights or remedies. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 32 551a E. [508] Remedies and Rights of Termination 1. [509] Damages If either party defaults with regard to any of the provisions of this Agreement, the non -defaulting party shall serve written notice of such default upon the defaulting party. If the default is not cured or commenced to be cured by the defaulting party within ninety (90) days after service of the notice of default (or within such other period as is set forth herein), the defaulting party shall be liable to the other party for any damages caused by such default. 2. [510] Specific Performance If either party defaults under any of the provisions of this Agreement, the non - defaulting party shall serve written notice of such default upon the defaulting party. If the default is not cured and/or commenced to be cured by the defaulting party within forty-five (45) days of service of the notice of default, or such other time limit as may be set forth herein with respect to such default, the non -defaulting party as its option may thereafter (but not before) continence an action for specific performance of terms of this Agreement. [511] Right of Termination by the Developer In the event that the Agency does not fund the portion of the Agency Assistance for the acquisition costs for the SA Site in the manner and condition, and by the date established in this Agreement and the Schedule of Performance (Attachment No. 4), and any such failure shall not be cured within thirty (30) days after written demand by the Developer then, at the option of the Developer, upon written notice thereof to the Agency, all provisions of this Agreement shall terminate and be of no further force and effect; thereafter, neither the Agency nor the Developer shall have any further rights against or liability to the other with respect to this Agreement. 4. [512] Termination by the Agency In the event that prior to the Agency funding of the Agency Assistance: (a) The Developer (or any successor in interest) assigns or attempts to assign the Agreement or any rights therein or in the SA Site in violation of this Agreement; or (b) There is a charge in the ownership of the Developer contrary to the provisions of Section 108 hereof; or (c) The Developer does not submit certificates of insurance, construction plans, drawings and related documents as required by this Agreement, in the manner and by the dates respectively provided in this Agreement therefor, and such default or failure shall not be cured or commenced to be cured within forty-five (45) days after the date of written demand therefor by the Agency; or CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 33 55161 (d) The Developer fails to satisfy the Conditions Precedent to the Conveyance by the time established therefor in the Schedule of Performance (Attachment No. 4); or (e) The Developer is otherwise in default under this Agreement and such failure is not cured or commenced to be cured within thirty (30) days of demand therefor by the Agency; then, at the option of the Agency, upon such written notice thereof to the Developer as may be set forth above, this Agreement shall be terminated, and thereafter neither party shall have any further rights or liability against the other under this Agreement. F. [513] Remedies of the Parties for Default After Closing of the Acquisition Escrow [514] Termination and Damages After the Close of the Acquisition Escrow, if the Developer or the Agency defaults with regard to any of the provisions of this Agreement, the nondefaulting party shall serve written notice of such default upon the defaulting party. If the default is not cured or commenced to be cured (and diligent efforts toward curing the default) by the defaulting party within thirty (30) days after service of the notice of default, the defaulting party shall be liable to the other party for any damages caused by such default. G. [515] Option to Purchase. Reenter and Repossess The Agency. shall have the additional right at its option to purchase, reenter and take possession of the SA Site with all improvements thereon, if after conveyance of title to the SA Site and prior to the issuance of the Certificate of Completion therefor, the Developer shall: 1. Fail to proceed with the construction of the Improvements as required by this Agreement (subject to any force majeure delays) for a period of three (3) months after written notice thereof from the Agency; or 2. Abandon or substantially suspend construction of the improvements for a period of three (3) months after written notice of such abandonment or suspension from the Agency; (subject to any force majeure delays) or 3. Transfer or suffer any involuntary transfer of the SA Site or any part thereof in violation- of this Agreement. Such right to repurchase, reenter and repossess, to the extent provided in this Agreement, shall be subordinate and subject to and be limited by and shall not defeat, render invalid or limit: CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 34 55161 Any mortgage, deed of trust or other security instrument permitted by this Agreement; or 2. Any rights or interests provided in this Agreement for the protection of the holder of such mortgages, deeds of trust or other security instruments. To exercise its right to repurchase, reenter and take possession with respect to the Site, the Agency shall pay to the Developer in cash an amount equal to: 1. The Purchase Price (cash amount), paid to the Agency for the SA Site; plus 2. The costs and expenses incurred by the Developer for development of the SA Site (which have not already been reimbursed), for the construction of the Improvements existing on the Site at the time of the repurchase, reentry and repossession; less 3. Any payment for work that has not been completed by the Developer on the SA Site or the Improvements thereon. H. [516] Right of Reverter The Agency shall have the additional right, at its option, to reenter and take possession of the Site with all improvements thereon and revest in the Agency the estate theretofore conveyed to the Developer, if after conveyance of title to the SA Site and prior to issuance of the Certificate of Completion, the Developer shall: 1. Fail to proceed with the construction of the improvements as required by this Agreement (subject to any force majeure delays) for a period of three (3) months after written notice of such abandonment or suspension from the Agency; or 2. Abandon or substantially suspend construction of the improvements for a period of three (3) months after written notice of such abandonment or suspension from the Agency; (subject to any force majeure delays) or 3. Transfer or suffer any involuntary transfer of the SA Site or any part thereof in violation of this Agreement. Such right to reenter, repossess and revest to the extent provided in this Agreement shall be subordinate and subject to and be limited by and shall not defeat, render invalid or limit: Any mortgage, deed of trust or other security instrument permitted by this Agreement; or 2. Any rights or interest provided in this Agreement for the protection of the holder of such mortgages, deeds of trust or other security instruments. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 35 55161 The grant deed shall contain appropriate reference and provision to give effect to the Agency's right, as set forth in this Section 516 under specified circumstances prior to the issuance of the Certificate of Completion, to reenter and take possession of the SA Site with all improvements thereon and to terminate and revest in the Agency the estate conveyed to the Developer. Upon the revesting in the Agency of title to the SA Site or any part thereof as provided in this Section 516, the Agency shall, pursuant to its responsibilities under state law, use its best efforts to resell the SA Site or part thereof as soon and in such manner as the Agency shall find feasible and consistent with the objectives of such law and of the Redevelopment Plan to a qualified and responsible party or parties (as determined by the Agency) who will assume the obligation of making or completing the improvements, or such other improvements in their stead, as shall be satisfactory to the Agency and in accordance with the uses specified for the SA Site or part thereof in the Redevelopment Plan. Upon such resale of the SA Site, the proceeds thereof shall be applied: l . First, to reimburse the Agency on its own behalf or on behalf of the City for all costs and expenses incurred by the Agency, including, but not limited to, salaries to personnel in connection with the recapture, management and resale of the SA Site or part thereof (but less any income derived by the Agency from the SA Site or part thereof in connection with such management); all taxes, assessments and water and sewer charges with respect to the SA Site or part thereof (or, in the event the SA Site is exempt from taxation or assessment or such charges during the period of ownership, then such taxes, assessments or charges, as determined by the County assessing official as would have been payable if the SA Site were not so exempt); any payments made or necessary to be made to discharge or prevent from attaching or being made any subsequent encumbrances or liens due to obligations, defaults or acts of the Developer; any expenditures made or obligations incurred with respect to the making or completion of the improvements or any part thereof on the SA Site or part thereof; and any amounts otherwise owing the Agency by the Developer; and 2. Second, to reimburse the Developer up to the amount equal to the sum of: (a) the Purchase Price paid to the Agency by the Developer for the Site (or allocable to the part thereof); plus (b) the costs and expenses incurred by the Developer for the development of the SA Site and for construction of the Improvements existing on the SA Site at the time of the reentry and repossession; less (c) any payments for work that has not been completed by the Developer on the SA Site or the SA improvements thereon. Any balance remaining after such reimbursements shall be retained by the Agency as its property. To the extent that the rights established in this Section 516 involve a forfeiture, it must be strictly interpreted against the Agency, the party for whose benefit it is created. The rights established in this Section 516 are to be interpreted in light of the fact that the Agency will convey the SA Site to the Developer for development and not for speculation. II. [517] Agency Obligations to Repurchase Site [In the event Developer is delayed or prevented from completing construction of any of the SA Improvements or SA Development as a result of the discovery of archeological matters or CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 36 sslsz artifacts on the SA Site, and Developer determines that as a result of such delay or inability to complete construction of the SA Development, that the cost variance from the Budget is greater than Twenty -Five Thousand Dollars ($25,000) on a cumulative basis with the SFR Development, the parties agree to split the additional verified cost up to a maximum total increase of One Hundred Thousand Dollars ($100,000) on a cumulative basis with the SFR Development. If the amount projected to complete due to discovery of new archaeological matters is greater than one hundred thousand dollars ($100,000) then either party may terminate this Agreement by written notice to the other, and the Agency agrees to repurchase the SA Site, or SA Development, as requested by Developer for cash in an amount equal to: 1 . . The cash portion of the SA Site Purchase Price (i.e., $1.00); plus 2. The unreimbursed costs and expenses incurred by the Developer for development of the SA Site and for the construction of the SA Improvements or SA Development existing on the SA Site at the time of the repurchase, reentry and repossession; less 3. Any payments for work that has not been completed by the Developer on the SA Site or the SA Improvements thereon and any Agency Assistance paid to Developer by Agency. VI. [600] GENERAL PROVISIONS A. [601 ] Notices. Demands and Communications Between Parties Written notices, demands and communications between the Agency and the Developer shall be sufficiently given if delivered by hand or dispatched by registered or certified mail, postage prepaid, return receipt requested, to the principal offices of the Agency and the Developer at the addresses specified in Section 106 and 107, respectively. Such written notices, demands and communications may be sent in the same manner to such other addresses as either party may from time to time designate by mail as provided in this Section 601. Any written notice, demand or communication shall be deemed received immediately if delivered by hand and shall be deemed received on the tenth (loth) day from the date it is postmarked if delivered by registered or certified mail. B. [602] Conflicts of Interest No member, official or employee of the Agency shall have any personal interest, direct or indirect, in this Agreement, nor shall any member, official or employee participate in any decision relating to the Agreement which affects his personal interests or the interests of any corporation, partnership or association in which he is directly or indirectly interested. No member, official or employee of the Agency shall be personally liable to the Developer, or any successor in interest, in the event of any default or breach by the Agency, or for any amount which may become due to the Developer or successor or on any obligations under the terms of this Agreement. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 37 551LGI C. [603] Enforced Delay-. Extension of Times of Performance In addition to specific provisions of this Agreement, performance by either party hereunder shall not be deemed to be in default, and all performance and other date specified in this Agreement shall be extended, where delays or defaults are due to: war; insurrection; strikes; lockouts; riots; floods; earthquakes; fires; casualties; acts of God; acts of the public enemy; epidemics; quarantine restrictions; freight embargoes; lack of transportation; governmental restrictions or priority; litigation; unusually severe weather; inability to secure necessary labor, materials or tools; delays of any contractor; subcontractor or supplier; acts or omissions of the other party; acts or failures to act of the City of La Quinta as the Agency or any other public or governmental agency or entity (other than the acts or failures to act of the Agency which shall not excuse performance by the Agency); or any other causes beyond the control or without the default of the party claiming an extension of time to perform. Notwithstanding anything to the contrary in this Agreement, an extension of time for any such cause shall be for the period of the enforced delay and shall commence to run from the time of the commencement of the cause, if notice by the party claiming such extension is sent to the other party within thirty (30) days of the commencement of the cause. Times of performance under this Agreement may also be extended in writing by the mutual agreement of Agency and Developer. Notwithstanding the foregoing portion of this Section 603, the Developer is not entitled pursuant to this Section 603 to an extension of time to perform because of past, present, or future difficulty in obtaining suitable construction financing for the development of the SA Site or because of the physical condition or suitability of the Site for the purposes of this Agreement. D. [604] Non -Liability of Officials and Employees of the Agency and the Developer No member, official or employee of the Agency or the City shall be personally liable to the Developer; or any successor in interest, in the event of any default or breach by the Agency or the City or for any amount which may become due to the Developer or its successors, or on any obligations under the terms of this Agreement. No officer, director or employee of the Developer shall be personally liable to the Agency or the City, or any successor in interest, in the event or breach by the Developer. E. [605] Entire Agreement. Waivers This Agreement is executed in three (3) duplicate originals, each of which is deemed to be an original. This Agreement includes pages 1 through 2 and Attachment Nos. 1 through 11, which constitutes the entire understanding and agreement of the parties. Each of the foregoing Attachments are incorporated herein by reference. This Agreement integrates all of the terms and conditions mentioned herein or incidental hereto, and supersedes all negotiations or previous agreements between the parties or their predecessors in interest with respect to all or any part of the subject matter hereof. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 38 55161 All waivers of the provisions of this Agreement must be in writing by the appropriate authorities of the Agency and the Developer, and all amendments hereto must be in writing by the appropriate authorities of the Agency and the Developer. In any circumstance where under this Agreement either party is required to approve or disapprove any matter, approval shall not be unreasonably withheld. F. [606] Amendments to this Agreement The Developer and the Agency agree to mutually consider reasonable requests for amendments to this Agreement which may be made by any of the parties hereto, lending institutions, or bond counsel or financial consultants to the Agency, provided such requests are consistent with this Agreement and would not substantially alter the basic business terms included herein. For purposes of this paragraph the Agency's Executive Director shall have the authority to approve such an amendment. VII. [700] TIME FOR ACCEPTANCE OF AGREEMENT BY AGENCY This Agreement, when executed by the Developer and delivered to the Agency, must be authorized, executed and delivered by the Agency on or before February 26, 1999, or this Agreement shall be void, except to the extent that the Developer shall consent in writing to a further extension of time for the authorization, execution and delivery of this Agreement. The date of this Agreement shall be the date when it shall have been signed by the Agency. IN WITNESS WHEREOF, the Agency and the Developer have signed this Agreement on the respective dates set forth below. LA QUINTA REDEVELOPMENT AGENCY, a public body corporate and politic By: Its: RON PERKINS, Chairman Dated: ATTEST: UNDRA L. JUHOLA, Agency Secretary CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 39 55161 APPROVED AS TO FORM: DAWN C. HONEYWElfL, Agency Counsel CATELLUS RESIDENTIAL GROUP, INC., a California corporation By: Its: Dated: CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 40 55161 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT State of California ss. County of L3& w O \ before me a e Name and Title of Officer e.g., " ane Doe, Not ublic") personally appeared 7 ¢k— ]JrName� �1,a REBECCA J. BLAKE Commission # 1167018 Z Z Notary Public - CaliforniaOrange County eMy Comm. Expires Jan 1, 2002 Place Notary Seal Above ir• ersona ly known to me -�.r - to be the person(s) whose name(s) 649b subscribed to the within instrument and acknowledged to me thati to sg/t4ey executed the same in Ii he0their authorized capacity(ies), and that by is /tJir signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. WIT SS y hand and official seal. L:�: - Sig na of Notary Public OPTIONAL Though the information below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent removal and reattachment of this form to another document. Description of Attached Document Title or Type of Document: Document Date: Signer(s) Other Than Named Above: Capacity(ies) Claimed by Signer Signer's Name: ❑ Individual ❑ Corporate Officer — Title(s): ❑ Partner — ❑ Limited ❑ General ❑ Attorney in Fact ❑ Trustee ❑ Guardian or Conservator ❑ Other: Signer Is Representing: Number of Pages: RIGHT THUMBPRINT OF SIGNER of thumb here © 1997 National Notary Association - 9350 De Soto Ave., P.O. Box 2402 - Chatsworth, CA 91313-2402 Prod. No. 5907 Reorder: Call Toll -Free 1-800-876-6827 55161 State of California County of Riverside On January 29, 1999 before me, Regenia Hensley, Notary Public, personally appeared, Ron Perkins, La Quinta Redevelopment Agency Chairman, Saundra L. Juhola, La Quinta Redevelopment Secretary, and Dawn C. Honeywell, La Quinta Redevelopment Agency Counsel, personally known to me to be the persons whose names are subscribed to the within instrument and acknowledged to me that they executed the same in their authorized capacities, and that by their signatures on the instrument the person or the entity upon behalf of which the persons acted, executed the instrument. WITNESS my hand and official seal. R NIA HENSL Y Notary Public (Seal) .., R GEN A HENSIEY p COMM. #1107891 o Z :r Notary Public -California x } RIVERSIDE COUNTY �J Mommission Expires /l !n AZ CGUST 7, 2000 .oA'Y¢'JC7'Cis+�J++�yKA^5.�r+e�w.ar:,.•a...^.rc . _-.n,r. OPTIONAL INFORMATION Document Description: Affordable Housing Agreement for Senior Apartments by and between La Quinta Redevelopment Agency and Catellus Residential Group, Inc. (Developer) Number of Pages: 120 (including notarial pages) Date of Document: October 6, 1998 55161 ATTACHMENT NO. 1 THE SA SITE CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 41 55161 ATTACHMENT NO. 2 LEGAL DESCRIPTION OF SA PROPERTY All that portion of the Southeast quarter of Section 29, Township 5 South, Range 7 East, San Bernardino Meridian, in the City of La Quinta, County of Riverside, State of California, described as follows: Commencing at the southeast corner of said Section 29; Thence North 89'16'18" West, a distance of 330.44 feet along the South line of said Section 29, also being the centerline of Avenue 48; Thence North 00°43'42" East, a distance of 56.61 feet to a point in the North line of said Avenue 48, said point being the point of beginning. Thence North 00°43'42" East, a distance of 125.39 feet; Thence North 89'16'18" West, a distance of 5 2. 00 feet; Thence North 00°43'42' East, a distance of 487.00 feet; Thence North 89' 1618" West a distance of 523.12 feet to the beginning of a tangent curve, concave southerly and having a radius of 220.00 feet; Thence westerly along said curve through a central angle of 20'18'37", an arc distance of 77.99 feet to a point in a non -tangent line; Thence north 19°34'55" West, a distance of 100.54 feet; Thence North 45°12'34" West, a distance of 141.00 feet; Thence North 43°58'19" West, a distance of 27.01 feet to the beginning of a non -tangent curve concave southeasterly and having a radius of 61 feet, a radial through said point bears north 45°12'34" west; Thence northeasterly along said curve through a central angle of 38°48'45", an arc distance of 41.32 feet to a point in a non -tangent line; Thence North 05'05'11" West, a distance of 70.35 feet; Thence North 45°12'34" West, a distance of 71.72 feet to a point in the East line of the Coachella Valley Water District La Quinta Evacuation Channel; Thence North 44°47'26" East, a distance of 26.82 feet; Thence South 89°40'45" East, a distance of 1126.18 feet to a point in the centerline of Jefferson Street; Thence South 00°05'20" East, a distance of 653.03 feet; Thence South 89°54'40" West, a distance of 80.00 feet; Thence South 00°05'20" East, a distance of 297.71 feet; Thence South 45'19'11" West, a distance of 32.76 feet; Thence North 89'16'18" West, a distance of 179.36 feet; Thence North 89044'57" West, a distance of 46.93 feet to the point of beginning. Contains 13.3709 Acres CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 42 55161. ATTACHMENT 3 SCOPE OF DEVELOPMENT SENIOR RENTAL APARTMENTS GENERAL SUMMARY This document outlines general requirements for all improvements to the project Site, including on - Site and off -Site public improvements. Detailed requirements will be addressed in the development review process and approval of specific construction plans and related documents. II. DEVELOPMENT CONCEPT The development concept is to construct approximately 118 senior rental apartments affordable to low and very low incomes. The 13.37 acre Site (hereinafter "Site") is located south of State Highway I I I at the northwest corner of Jefferson Street and 48' Avenue. The Developer and Agency agree that the Site shall be subdivided, developed and improved by the Developer in accordance with the provision of this agreement, subject to all applicable codes, ordinances, and statutes including requirements and procedures set forth in the La Quinta Municipal Code, and the Redevelopment Plan regulations adopted in conjunction with or subsequent to execution of this Agreement. III. SITE DESCRIPTION The proposed Site is 13.37 acres in size and is undeveloped. The Site as it currently exists has variable topography with sand dunes ranging in elevation from 42 to 67 feet in elevation with several sand hummocks. The Site is bordered to the north by City of Indio commercial land use, to the east by Jefferson Street, and to the south and west by proposed single family residential development. IV. ON -SITE DEVELOPMENT AND IMPROVEMENTS Developer shall, prepare a grading plan, scarify, overexcavate, cut, fill, compact, rough grade and fine grade, as required pursuant to a grading plan approved by the Director of Public Works, to create building pads, and appropriate rights of way configurations as necessary for construction of the project. Plans shall be prepared by a licensed civil engineer in good standing and subject to the approval of the Director of Public Work. Developer shall prepare or cause to be prepared and recorded a Tract Map which illustrates the Site, easements encumbering the Site, dedications and realignment of streets, if any. Developer shall grant and permit all necessary and appropriate utility easements and rights for the development of the Site, including but not limited to sanitary sewers, storm drains, water, electrical power, telecommunications, natural gas, cable, etc. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 43 5siss V. PUBLIC IMPROVEMENTS The City/Agency shall be responsible for the dedication of an alternate Site to CVWD for future pump facilities in lieu of placement on the project Site. The Developer shall be responsible for the installation of the necessary utility connections in the boundaries of the project Site between the improvements and the water, sanitary sewer, storm drain, electric, natural gas, telecommunications, cable television or other public utilities. The Developer shall secure any permits required for any such installation or installations. The Developer shall construct all required public improvements in accordance with the standards and specifications adopted by the city. The Developer shall be responsible for repairing any public improvements it damages during construction of the project. VI. DEVELOPMENT STANDARDS All development on the project Site shall conform with the development standards adopted as part of the Village on the Green Specific Plan. A. General Project Design All structures on the Site shall be designed and constructed to be consistent with the conceptual drawings prepared as part of the development proposal submitted by the Developer. B. Dwelling Unit Design The dwelling units range in size from a minimum of 650 square feet to a maximum of 900 square feet and include at least two distinct floor plans. There shall be a mix of one and two bedrooms homes, all of which are affordable to low and very low income groups. Each of the units shall have covered parking. C. Development Process The developer and its representatives, including its architect and engineer, shall work with the Agency and City Staff to develop and execute the architectural concept, architectural drawings, Site plan, tentative tract map, precise plan, grading plan, off -Site improvement plans, landscaping plans and related plans consistent with the conditions of approval adopted by the City and Agency and the applicable regulations contained in the La Quinta Municipal Code. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 44 55161 ATTACHMENT #4 SCHEDULE OF PERFORMANCE SENIOR RENTAL APARTMENTS 1. Developer to submit to City, Village on Completed. the Green Specific Plan, Tentative Tract Map, site Development Permit Application, and General Plan Amendment application. 2. City approves, or approves subject to Completed. conditions, Village on the Green Specific Plan, Tentative Tract Map, Site Development Permit application and General Plan Amendment application and this Agreement. 3. City approves this Affordable Housing October 6`'', 1998. Agreement. 4. Developer submits 1" application for Upon receipt of all attachments from the City, Federal & State tax credits. including an executed AHA, and within deadline period of first application round of 1999. 5. Developer submits 2"d application for Upon receipt of all attachments from the City, Federal & State tax credits. including an executed AHA, and within deadline period of second application round of 1999. 6. Developer submits 3' application for Upon receipt of all attachments from the City, Federal & State tax credits including an executed AHA, and within deadline period of third application round of 1999, if held, or first application round of 2000. 7. Developer receives access permit to Within 5 days of approval of AHA by City stage and pre -water site. and Agency. 8. Developer submits evidence of Prior to transfer of title to the SA Site. satisfaction of the AHA conditions precedent set forth in Section 202 and 212. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 45 55161 9. Grading Plan. Developer submits grading plan to City. City provides correction comments to developer Developer completes corrections and resubmits to City. . City approves grading plan. Developer submits approved grading plan and receives permit from City. 10. Construction Drawings Developer submits construction drawings to City. City provides correction comments to developer. Developer completes corrections and resubmits to City. City approves construction drawings Developer submits approved grading plan and receives permits. Within 120 days of receipt of preliminary reservation of State & Federal tax credits. Within 15 days of receipt of grading plan. Within 30 days of receipt of City comments. Within 15 days of receipt of resubmittal. Within 30 days of receipt of approved grading plan. Within 150 days of receipt of preliminary reservation of State & Federal tax credits. Within 45 days of receipt of construction drawings. Within 30 days of receipt of City comments. Within 30 days of receipt of resubmittal. Within 30 days of receipt of approved grading plan. 11. Developer submits minor use Within 165 days of receipt of preliminary application for prototype model; - - reservation -of State-& Federal tax credits. leasing facility and recreation area. 12. Developer shall obtain all necessary Prior to commencement of the respective permits for the construction of the improvement construction. improvements. 113. Developer shall commence grading I Within 30 days of issuance of grading permit. I operations. 114. Developer shall commence I Within 3 months of issuance of building I construction of the models. permits. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 46 55161 15. Developer shall commence Within 6 months of issuance of building construction of the Phase 1 unit permits. construction. 16. Developer shall complete construction Within 30 months after commencement of of the SA Development construction of SFR Development. 17. Upon completion of construction, Within 10 days after Agency receipt of Agency shall issue a Certificate of written request from Developer for Certificate Completion for the improvements or of Completion pursuant to .Section 315 of the shall provide Developer with a written AHA. explanation of reasons why such a Certificate shall not be issued. 18. Developer receives complete bond Within 60 days of receipt of Certificate of exoneration from City and installs all Completion. final monuments. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 47 55161 ATTACHMENT NO.5 FORM OF GRANT DEED RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: Catellus Residential Group, Inc. 5 Park Plaza, Suite 400 Irvine, California 92715 Attn: John O'Brien MAIL TAX STATEMENTS TO: Same as above. GRANT DEED Assessor's Parcel Number: 649-030-020 This document is exempt from payment of a recording fee pursuant to Government Code Section 6103. LA QUINTA REDEVELOPMENT AGENCY By: Its: Executive Director FOR VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, the undersigned, LA QUINTA REDEVELOPMENT AGENCY, a public body corporate and politic ("Grantor"), hereby grants to CATELLUS RESIDENTIAL GROUP, INC., a California corporation ("Grantee"), that certain real property in the City of La Quinta, County of Riverside, State of California described in Exhibit "A" attached hereto and incorporated herein, together with any and all buildings and improvements located thereon (the "Property"). This Grant Deed is conditioned upon the affordability restrictions set out in Section 401 of the Affordable Housing Agreement for Senior Apartments and the Declarations of Conditions, Covenants and Restrictions recording simultaneously herewith Dates: LA QUINTA REDEVELOPMENT AGENCY, a public body corporate and politic THOMAS P. GENOVESE Executive Director CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 48 S5161 State of California ) ss. County of Riverside ) On before me, personally appeared , personally known to me or 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. WITNESS my hand and official seal. (SEAL) Signature Printed name Commissioner expires State of California ) ) ss. County of Riverside ) On before me, personally appeared , personally known to me or 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. WITNESS my hand and official seal. (SEAL) . Signature Printed name Commissioner expires CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 49 55161 ATTACHMENT NO. 6 FORM OF SA PROMISSORY NOTE SECURED BY DEED OF TRUST La Quinta, California October 6, 1998 On October 6,2008 (the "Maturity Date"), for money advanced and value received, the undersigned (the "Promisor"), promises to pay to the La Quinta Redevelopment Agency (the "Holder"), or to order at 78-495 Calle Tampico, La Quinta, California 92253, or any other place designated in a writing submitted by Holder to Promisor, the principal sum of $ , with no interest on the principal amount; provided, however, that the payment of the principal sum shall be waived and the obligation deemed for all purposes fully satisfied after a time period of forty (40) years and upon performance by Promisor of considerations and covenants provided in the Affordable Housing Agreement for Senior Apartments executed by and between the Promisor and the Holder, dated the same date as this Developer Note and executed concurrently herewith (the "Affordable Housing Agreement"), or upon termination of the Affordable Housing Agreement under its terms. In addition, pursuant to Section 201(3) of the Affordable Housing Agreement, the principal amount of this Developer Promissory Note shall be automatically reduced by one -eighty-sixth (1/86) of the face amount of this Developer Promissory Note upon the close of each escrow for a Restricted Unit (as defined in the Affordable Housing Agreement). Principal and interest payable under this Developer Promissory Note, if any, shall be paid in lawful money of the United States of America. There shall be no prepayment of this Developer Promissory Note. This Developer Promissory Note is secured by, among other things, the Deed of Trust and Security Agreement with Assignment of Rents and Agreements dated the same date as this Developer Promissory Note, executed by Promisor, as trustor, in favor of Holder, as beneficiary (the "Deed of Trust"), and encumbering the fee interest in the real property described in the Deed of Trust (the "Land"). The Holder will be entitled to the benefits of the security provided by the Deed of Trust and will have the right to enforce the covenants and agreements of Promisor contained in the Deed of Trust and the Affordable Housing Agreement. If: (a) Promisor fails to pay when due any sums payable under this Developer Promissory Note; (b) an Event of Default (as defined in the Deed of Trust) occurs; or (c) a default under the Affordable Housing Agreement occurs which is not cured within the applicable cure period set forth therein; C:\My Documents\WPDOCS\Cat-AFA-SenApt.wpd 50 55161 then Holder, at its sole option, shall have the right to declare all sums owing under this Developer Promissory Note immediately due and payable. However, if any document related to this Developer Promissory Note (including, but not limited to, the Affordable Housing Agreement) provides for the automatic acceleration of payment of sums owing under this Developer Promissory Note, all sums owing shall be automatically due in accordance with the terms of that document. Promisor shall pay to Holder all sums owing under this Developer Promissory Note, if not waived, without deduction, offset, or counterclaim of any kind. The advance of money evidenced by this Developer Promissory Note and secured by the Deed of Trust shall in no manner make Holder the partner or joint venturer of Promisor. If any attorney is engaged by Holder to enforce or construe any provision of this Developer Promissory Note, the Deed of Trust, the Affordable Housing Agreement or any other Security Documents (as defined in the Deed of Trust) or as a consequence of any Event of Default, with or without the filing of any legal action or proceeding, then Promisor shall immediately pay to Holder on demand all reasonable attorney fees and other costs incurred by Holder, together with interest. No previous waiver or failure or delay by Holder in acting with respect to the terms of this Developer Promissory Note, the Deed of Trust or the Affordable Housing Agreement shall constitute a waiver of any breach, default, or failure of condition under this Developer Promissory Note, the Deed of Trust or the Affordable Housing Agreement. A waiver of any term of this Developer Promissory Note, the Deed of Trust or the Affordable Housing Agreement must be made in writing and shall be limited to the express written terms of the waiver. If there are any inconsistencies between the terms of this Developer Promissory Note and the terms of the Deed of Trust or the Affordable Housing Agreement, the terms of this Developer Promissory Note shall prevail. All notice required or permitted in connection with this Developer Promissory Note shall be in writing and shall be given at the place and in the manner provided in the Deed of Trust for the giving of notices. If this Developer Promissory Note is executed by more than one person or entity -as Promisor, the obligations of each person or entity shall be joint and several. No person or entity shall be a mere accommodation maker, but each shall be primarily and directly liable. Promisor waives presentment; demand; notice -of -dishonor; notice of default or delinquency; notice of acceleration; notice of protest and nonpayment; notice of costs, expenses, or losses and interest; notice of interest on interest and late charges; and diligence in taking any action to collect any sums owing under this Developer Promissory Note or in proceeding against any of the rights or interests to properties securing payment of this Developer Promissory Note. Time is of the essence with respect to every provision of this Developer Promissory Note. This Developer Promissory Note shall be construed and enforced in accordance with the laws of the State of California, except to the extent that Federal law preempts state law, and all persons and entities in any manner obligated under this Developer Promissory Note consent to the jurisdiction of any Federal or State Court within California having proper venue and also consent to service of process by any means authorized by California or Federal law. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 51 55161 Promisor shall not be personally liable for the payment of the indebtedness or any obligations evidenced by this Developer Promissory Note or the Affordable Housing Agreement, and any judgment or decree in any action brought to enforce the obligation of Promisor to pay the indebtedness shall be enforceable against Promisor and the partners of the Promisor, if any, only to the extent of Promisor's interest in the Land and any other collateral pledged, encumbered, or otherwise covered by the Deed of Trust. Any judgment or decree shall not be subject to execution, or be a lien, on the assets of Promisor and the partners of the Promisor, if any, other than Promisor's interest in the Land and any other collateral pledged, encumbered, or otherwise covered by the Deed of Trust. Nothing in the preceding paragraph shall affect or limit the rights of Holder to enforce any of Holder's rights or remedies with respect to any portion of the Land or any other collateral pledged, encumbered, or otherwise covered by the Deed of Trust. CATELLUS RESIDENTIAL GROUP, INC., a California corporation By: Its: CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 52 S51G1 ATTACHMENT NO. 7 SA DEED OF TRUST AND SECURITY AGREEMENT, WITH ASSIGNMENT OF RENTS AND AGREEMENTS RECORDING REQUESTED BY ) AND WHEN RECORDED MAIL TO: ) LA QUINTA REDEVELOPMENT AGENCY ) 78-495.Calle Tampico ) La Quinta, California 92253 ) Attention: Executive Director ) Assessor's Parcel #649-030-020 Space Above For Recorder This Agreement is recorded at the request and for the benefit of the Agency and is exempt from the payment of a recording fee pursuant to Government Code Section 6103. LA QUINTA REDEVELOPMENT AGENCY By: Its: Executive Director Dated: October 6, 1998 DEED OF TRUST, AND SECURITY AGREEMENT, WITH ASSIGNMENT OF RENTS AND AGREEMENTS NOTICE: THIS DEED OF TRUST AND SECURITY AGREEMENT, WITH ASSIGNMENT OF RENTS AND AGREEMENTS CONTAINS A SUBORDINATION CLAUSE WHICH MAY RESULT IN YOUR SECURITY INTEREST' IN THE LAND BECOMING SUBJECT TO AND OF LOWER PRIORITY THAN THE LIEN OF SOME OTHER OR LATER SECURITY INSTRUMENT CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 53 55161 ARTICLE 1. DEFINITIONS ... Section 1.1 TABLE OF CONTENTS Page 2 Certain Defined Terms ............................... 2 ARTICLE 2. WARRANTY OF TITLE ............................................ 4 ARTICLE 3. REPRESENTATIONS AND WARRANTIES ............................... 4 Section 3.1 Organization of the Trustor ............................ 5 Section 3.2 Validity of Security Documents .......................... 5 Section 3.3 Representations to Beneficiary .......................... 5 Section 3.4 Use of Proceeds of Loan .............................. 6 Section 3.5 Other Arrangements ................................. 6 Section 3.6 Litigation ........................................ 6 Section 3.7 Other Warranties ................................... 6 Section 3.8 Compliance with Laws ............................... 7 ARTICLE 4. AFFIRMATIVE COVENANTS ........................................ 7 Section 4.1 Obligations of Trustor ................................ 7 Section 4.2 Insurance ........................................ 8 Section 4.3 Maintenance, Waste, and Repair ......................... 8 Section 4.4 Impositions ....................................... 8 Section 4.5 Compliance with Law ................................ 8 Section 4.6 Books and Records .................................. 9 Section 4.7 Further Assurances .................................. 9 Section 4.8 Statement by Trustor................................. 9 Section 4.9 Indemnity ........................................ 9 Section 4.10 Reimbursement ................................... 10 Section 4.11 Litigation ....................................... 10 Section 4.12 Tax Receipts ..................................... 10 Section 4.13 Additional Information .............................. 10 Section 4.14 Right of Entry ..................................... 10 ARTICLE 5. NEGATIVE COVENANTS .......................................... 11 Section 5.1 Restrictive Uses .................................... 11 Section 5.2 Subordination to Other Financing ....................... 11 Section 5.3 Transferability .................................... 11 CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 54 55161 ARTICLE 6. ENVIRONMENTAL PROVISIONS .................................. 12 Section 6.1 Warranties and Covenants ............................ 12 Section 6.2 Inspection and Receivership Rights ..................... 14 Section 6.3 Release and Indemnity 15 Section 6.4 Request for Information .............................. 15 ARTICLE 7. CASUALTIES AND CONDEMNATION ................................. 16 Section 7.1 Casualties ....................................... 16 Section 7.2 Condemnation .................................... 16 /:j.41[oinCa:] EVENTS OF DEFAULT AND REMEDIES ............................... 17 Section 8.1 Events of Default .................................. 17 Section 8.2 Power of Sale .................................... 18 Section 8.3 Proof of Default ................................... 19 Section 8.4 Protection of Security ............................... 19 Section 8.5 Receiver ........................................ 20 Section 8.6 Curing the Defaults ................................ 20 Section 8.7 Inspection Rights .................................. 21 Section 8.8 Judgment on Environmental Provision .................... 21 Section 8.9 Waive Lien ...................................... 21 Section 8.10 Remedies Cumulative ............................... 22 ARTICLE 9. SECURITY AGREEMENT .......................................... 22 Section 9.1 Security Interest ................................... 22 Section 9.2 Remedies ....................................... 22 Section 9.3 Expenses ....................................... 23 Section 9.4 Assignment of Agreements ............................ 23 ARTICLE 10. ASSIGNMENT OF LEASES AND RENTS ............................... 24 Section 10.1 Assignment ...................................... 24 Section 10.2 License .......... ......... ........ .......... 24 Section 10.3 Effect of Assignment ............................... 24 Section 10.4 Leasing Covenants ................................ 25 Section 10.5 Application of Rents ................................ 25 Section 10.6 Remedies ....................................... 26 Section 10.7 Definitions ...................................... 26 ARTICLE 11. MISCELLANEOUS .........:..................................... 26 Section 11.1 Successor Trustee .................................. 26 Section 11.2 No Waiver ...................................... 26 Section 11.3 Abandonment .................................... 27 C:\My Documents\WPDOCS\Cat-AFA-SenApt.wpd 55 55161 Section 11.4 Notices ........................................ 27 Section 11.5 Survival 27 ........................................ Section 11.6 Severability ...................................... 28 Section 11.7 References to Foreclosure ............................ 28 Section 11.8 Joinder of Foreclosure ............................... 28 Section 11.9 Rights of Beneficiary and Trustee ....................... 28 Section 11.10 Copies ......................................... 29 Section 11.11 Subordination to Contracts of Sale and Leases ............... 29 Section 11.13 Performance by Trustor .............................. 29 Section 11.14 Junior Liens ..................................... 30 Section 11.15 Waiver of Statute of Limitations ........................ 30 Section 11.16 Charges for Statements .............................. 30 Section 11.17 Waiver of Marshaling Rights .......................... 30 Section 11.18 Acceptance of Trust; Powers and Duties of Trustee ............ 30 Section 11.19 Releases, Extensions, Modifications, and Additional Security ..... 31 Section 11.20 Reconveyance.................................... 31 Section 11.21 Subrogation ...... ............ ................. 32 Section 11.22 Obligations of Trustor Joint and Several ................... 32 Section 11.23 Rules of Construction ............................... 32 Section 11.24 Successors in Interest ............................... 32 Section 11.25 No Offset ....................................... 32 Section 11.26 Governing Law ................................... 32 Section 11.27 Partial Reconveyances ............................... 32 C AMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 56 55161 DEED OF TRUST AND SECURITY AGREEMENT, WITH ASSIGNMENT OF RENTS AND AGREEMENTS This Deed of Trust, Security Agreement, and Fixture Filing with Assignment of Rents and Agreements (the "Deed of Trust") is made as of October 6, 1998, by CATELLUS RESIDENTIAL GROUP, INC., a California corporation (the "Trustor"), to First American Title Insurance Company (the "Trustee"), for the benefit of the LA QUINTA REDEVELOPMENT AGENCY, a public body, corporate and politic ("Beneficiary"). WITNESSETH: Trustor does irrevocably grant, transfer, and assign to Trustee, in trust, with power of sale; all Trustor's right, title, and interest now owned or later acquired in the fee interest in the real property (the "Land") located in the City of La Quinta, County of Riverside, California, and more particularly described in attached Exhibit A, attached hereto and incorporated herein by reference (Trustor agrees that any greater title to the Land later acquired during the term of this Deed of Trust will be subject to this Deed of Trust),together with the rents, issues, and profits, subject however, to the right, power, and authority granted and conferred on Trustor in this Deed of Trust to collect and apply the rents, issues, and profits; and Trustor also irrevocably grants, transfers, and assigns to Trustee, in trust, with power of sale, all of Trustor's right, title, and interest now owned or later acquired to the following property (including the rights or interests pertaining to the property) located on the Land: (1) all appurtenances, easements, water and water rights, and pumps and pumping plants, and all shares of stock evidencing these; all of these items, whether now or later acquired, being declared to be for all purposes of this Deed of Trust a part of the Land, the specific enumerations in this Deed of Trust not excluding the general; (2) the rents, issues, profits, and proceeds thereof; and (3) the Land to the extent any fee interest is not included in clauses (1) and (2) above. ----- ----------For -the purpose of securing, -in the order of priority that Beneficiary determines - (1) repayment of moneys advanced by the Beneficiary to the Trustor (the "Loan") as evidenced by a Developer Promissory Note of Trustor of the same date as this Deed of Trust in the principal amount of Six Million Seven Hundred and Thirteen Thousand and Four Hundred and Sixteen Dollars ($6,713,416) (the "Developer Note"), a copy of which is incorporated herein by reference and attached hereto as Exhibit B, payable to Beneficiary or to order, and all extensions, modifications, or renewals of that Developer Note; (2) payment of all sums, if any, due on the Loan according to the terms of the Developer Note; (3) payment of all other sums (with interest as provided in this Deed of Trust) becoming due and payable to Beneficiary or Trustee pursuant to the terms of this Deed of Trust; and CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd .57 55161 (4) performance of every obligation contained in this Deed of Trust, the Developer Note, the Affordable Housing Agreement of the same date as this Deed of Trust entered into by and between the Trustor and the Beneficiary (the "Affordable Housing Agreement"), and any agreements, supplemental agreements, or other instruments of security executed by Trustor as of the same date of this Deed of Trust for the purpose of further securing any obligation secured by this Deed of Trust, or any part of it, or for the purpose of supplementing or amending this Deed of Trust or any instrument secured by this Deed of Trust. ARTICLE 1. DEFINITIONS Section 1.1 Certain Defined Terms. Capitalized terms used herein shall have the following meanings unless the context in which they are used clearly requires otherwise. Collateral: The Collateral as defined in Section 9.1 of this Deed of Trust. Default Rate: The maximum rate of interest authorized under the laws of the State of California. Event of Default: Any of the events of default listed under Section 8.1 herein. Loan: The principal and all other amounts, payments, and premiums due, if not waived, under the Developer Note and any extensions or renewals (including, without limitation, extensions or renewals at a different rate of interest, regardless of whether evidenced by a new or additional promissory note or notes as agreed to in writing by Trustor), and all other indebtedness or obligations of Trustor. to Beneficiary under or secured by this Deed of Trust. Hazardous Materials: The meaning set forth in Section 214(5) of the Affordable Housing Agreement. Hazardous Materials Claim: Any enforcement, cleanup, removal, remedial, or other governmental, regulatory, or private actions, agreements, or orders threatened, instituted, or completed pursuant to any Hazardous Materials Law, together with all claims made by any third party against Trustor or the Land relating to damage, contribution, cost -recovery compensation, loss, or injury resulting from the presence, release, or discharge of any Hazardous Materials. Hazardous Materials Law: Those federal, state, or local laws set forth in Section 214(5) of the Affordable Housing Agreement. Impositions: All real estate and personal property taxes and other taxes and assessments, water and sewer rates and charges, and all other governmental charges and any interest or costs or penalties with respect to those charges, assessments, or taxes, ground rent and charges for any easement or agreement maintained for the benefit of the Land, general and special, that at any CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 58 55161 time prior to or after the execution of the Enforcement Documents may be assessed, levied, imposed, or become a lien on the Land or the rent or income received from the Land, or any use or occupancy of the Land; and any charges, expenses, payments, or assessments of any nature, if any, that are or may become a lien on the Land or the rent or income received from the Land. Improvements: All buildings, improvements, and appurtenances on the Land, and all improvements, additions, and replacements of those improvements and other buildings and improvements, at any time later constructed or placed on the Land. Land: The real property as located in the City of La Quinta, Riverside County, California and more particularly described in attached Exhibit A and any fee interest now owned or later acquired in such property, together with all rights, privileges, hereditaments, tenements, rights of way, easements and appurtenances of the land. Material Adverse Change: Any material and adverse change in: or (i) the business or properties or condition (financial or otherwise) of Trustor; (ii) the condition or maintenance of the Land. Obligations: All of the covenants, promises, and other obligations (other than the Loan) made or owing by Trustor to or due to Beneficiary under or as set forth in the Deed of Trust. Person: Any natural person, corporation, firm, association, government, governmental agency, or any other entity, whether acting in an individual, fiduciary, or other capacity. Personalty: Trustor's interest, if any, in all accounts, contract rights, and general intangibles (specifically including any insurance proceeds and condemnation awards) arising out of the ownership and maintenance of the Land. PrWe : The land and the single family residential project known as the VILLAGE ON THE. GREENS PROJECT. Receiver: Any trustee, receiver, custodian, fiscal agent, liquidator, or similar officer. Release: Any spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, or disposing into the environment, including continuing migration, of Hazardous Substances that goes into the soil, surface water, or groundwater of the Land, whether or not caused by, contributed to, permitted by, acquiesced to, or known to Trustor. Security Documents: This Deed of Trust and all other documents now or later securing any part of the payment of the Loan or the observance or performance of the Obligations. Title Policy: The title insurance policy issued by First American Title Insurance Company to Beneficiary. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 59 Trustor: Collectively, Trustor or any obligor under the Developer Note and the Affordable Housing Agreement, together with their respective affiliates and their respective employees, representatives, and agents. ARTICLE 2. WARRANTY OF TITLE Trustor warrants that: (a) Trustor is the lawful owner of the Land; (b) Trustor shall maintain and preserve the lien of this Deed of Trust until the Loan has been paid in full or has been waived by the Beneficiary under the provisions of the Developer Note; (c) Trustor has good, right, and lawful authority to grant the Land as provided in this Deed of Trust; and (d) Trustor will forever warrant and defend the grant made in this Deed of Trust against all claims and demands, except as are specifically set forth in this Deed of Trust. ARTICLE 3. REPRESENTATIONS AND WARRANTIES Trustor represents and warrants to Beneficiary that as of the date of this Deed of Trust: Section 3.1 Organization of the Trustor. (a) Trustor is a duly organized corporation, validly existing, and in good standing under the laws of the State of California and is qualified to do business in California. (b) Trustor has the requisite power and authority to own and maintain its properties, to carry on -its -business- as -now -being-conducted, - and- to --own;- maintain -and lease the Land. Section 3.2 Validity of Security Documents. (a) The execution, delivery, and performance by the Trustor of the Security Documents and the borrowings evidenced by the Developer Note: (i) are within the power of the Trustor; (ii) have been duly authorized by all requisite corporate or partnership actions, as appropriate; (iii) have received all necessary governmental approval; and CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 60 55161 (iv) will not violate any provision of law, any order of any court or agency of government, the charter documents of the Trustor, or any indenture, agreement, or any other instrument to which the Trustor is a party or by which the Trustor or any of its property is bound, nor will they conflict with, result in a breach of, or constitute (with due notice and lapse of time) a default under any indenture, agreement, or other instrument, or result in the creation or imposition of any lien, charge, or encumbrance of any nature on any of the property or assets of the Trustor, except as contemplated by the provisions of the Security Documents. (b) Each of the Security Documents, when executed and delivered to Beneficiary, will constitute a valid obligation, enforceable in accordance with its terms. Section 3.3 Representations to Beneficiary. (a) All financial statements, reports, papers, data, and information given to Beneficiary with respect to Trustor, and the Land and with respect to the Trustor's ability to own and maintain the Land in accordance with the Affordable Housing Agreement are: (i) accurate and correct in all material respects and complete insofar as completeness may be necessary to give Beneficiary a true and accurate knowledge of the subject matter; (ii) accurately in all material respects present the results of the operations of the Trustor for the periods for which they have been furnished; and (iii) in regards to financial statements, have been prepared in accordance with generally accepted accounting principles consistently applied throughout the periods covered. (b) All information and financial statements with respect to the Trustor furnished to Beneficiary disclose all liabilities of the Trustor, fixed and contingent, as of their respective dates. Section 3.4 Use of Proceeds of Loan. Trustor will use the funds 'or the Land advanced pursuant to the Developer Note for the purposes set forth in the Affordable Housing Agreement. Section 3.5 Other Arrangements. Trustor is not a party to any agreement or instrument materially and adversely affecting Trustor's present or proposed business, properties, assets, operation, or condition, financial or otherwise; and Trustor is not in default in the performance, observance, or fulfillment of any of the material obligations, covenants, or conditions in any agreement or instrument to which. Trustor is a party that materially and adversely affect Trustor's present or proposed business, properties, assets, operation, or condition, financial or otherwise. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 61 55161 Section 3.6 Litigation. There is not now pending against Trustor, nor to the knowledge of the Trustor is there threatened, any action, suit, or proceeding at law or in equity or before any administrative agency that, if adversely determined, would materially impair or affect: (a) the financial condition or the ability of the Trustor necessary to operate and maintain and sell the Land and Restricted Units in accordance with the Affordable Housing Agreement: or (b) the condition of the Land. Section 3.7 Other Warranties. (a) The Land is used principally or primarily for purposes designated in the Affordable Housing Agreement; (b) Trustor is engaged in the development, operation and sale of the Improvements; and (c) the principal purpose of the Loan is to induce, cause and assist the development, construction and sale of housing on the Land at affordable costs for moderate income households in a number of units and for a duration beyond that required by State of California and federal law. Section 3.8 Compliance with Laws. Except as otherwise provided in this Deed of Trust, the Land and the proposed and actual use of the Land comply in all material respects with all laws, ordinances, rules, and regulations of all local, regional, county, state, and federal governmental authorities having jurisdiction (including, but not limited to, the Americans With Disabilities Act), and there is no action or proceeding pending or, to the knowledge of Trustor after due inquiry, threatened before any court, quasi-judicial body, or administrative agency at the time of any disbursement by ---Beneficiary -reiating-to the validity of -the -Loan or -the-proposed -or -actual- use of the -Land. ARTICLE 4. AFFIRMATIVE COVENANTS Until the entire Loan has been paid in full or waived, Trustor covenants to and agrees with Beneficiary as follows: Section 4.1 Obligations of Trustor. Subject to the provisions set forth in the Developer Note, Trustor will pay the Loan and Trustor will continue to be liable for the payment of the Loan until it has been paid in full or until repayment has been waived or forgiven by the Beneficiary under the terms of the Developer Note. Trustor CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 62 55161 (a) will timely perform all the covenants, agreements, terms, and conditions to be performed by Trustor- (i) under this Deed of Trust and the Affordable Housing Agreement; (ii) as seller under each contract of sale of, for which a contract of sale has been approved in writing by Beneficiary; (iii) as required of Trustor under each document and agreement constituting one of the Security Documents; and (iv) under all other agreements between Trustor and Beneficiary in accordance with the respective terms of the agreement; and (b) will not cancel, surrender, modify, amend, or permit the cancellation, surrender, modification, or amendment of any of the previously mentioned agreements or any of the covenants, agreements, terms, or conditions contained in any of them, except in the ordinary course of Trustor's business, without the prior written consent, in each case, of Beneficiary which consent shall not be unreasonably withheld. Section 4.2 Insurance. (a) Trustor, at its sole cost and expense, will obtain and maintain or shall cause to be obtained and maintained public liability insurance covering the Land and the ownership, use, occupancy, and maintenance of the Land and the Project in accordance with the Affordable Housing Agreement. (b) Trustor, at its sole cost and expense, but for the mutual benefit of Trustor and Beneficiary, will maintain during the term of this Deed of Trust other insurance, and in any amounts, as may from time to time be reasonably required by Beneficiary against other insurable risks. - --- -- c All olicies of -insurance required pursuant to this Deed of Trust will be O - ---All p q satisfactory in form and substance to Beneficiary and will be approved by Beneficiary as to amounts, form, risk coverage, deductibles, insurer, loss payable, and cancellation provisions. (d) Effective on the occurrence of any Event of Default, all of Trustor's right, title, and interest in all policies of property insurance and any unearned premiums paid are assigned to Beneficiary, who may assign them to any purchaser of the Land at any foreclosure sale. Section 4.3 Maintenance. Waste. and Repair. Trustor will maintain the Land now or later existing in good and tenantable repair, and will not structurally alter any -Improvements located thereon without the prior written consent of Beneficiary, or remove or demolish them in whole or in part, nor will Trustor suffer any waste CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 63 55161 of the Land or make any change in the use of the Land that will in any way impair the security of this Deed of Trust. Trustor will not abandon the Land or leave the Land unprotected, vacant, or deserted. Section 4.4 Impositions. Trustor will pay prior to delinquency all Impositions that are or that may become a lien on the Land or are assessed against the Land or its rents, royalties, profits, and income. Section 4.5 Compliance with Law. Trustor will preserve and keep in full force its existence, rights, and powers. Trustor will promptly and faithfully comply with all present and future laws, ordinances, rules, regulations, and requirements of every governmental authority or agency and of every board of fire underwriters (or similar body exercising similar functions) having jurisdiction that may be applicable to it or to the Land or to the use or manner of occupancy, possession, operation, maintenance, alteration, or repair of the Land or any part of it. Section 4.6 Books and Records. Trustor will maintain complete books of account and other records reflecting the results of Trustor's operations maintenance and lease of the Land, in a form satisfactory to Beneficiary, and furnish to Beneficiary any information about the financial condition of Trustor, and the sales and maintenance of the Land as Beneficiary reasonably requests, including, but not limited to, copies of any reports by independent public accountants submitted to Trustor concerning the Land. Beneficiary will have the right, at all reasonable times and on reasonable notice, to audit, at Trustor's sole cost and expense, Trustor's books of account and records relating to the Land, all of which will be made available to Beneficiary and Beneficiary's representatives for that purpose, from time to time, on Beneficiary's request. Section 4.7 Further Assurances. Trustor, at Trustor's expense and at any time on the reasonable request of Beneficiary, --will. execute, .acknowledge, --and deliver- any._ additional papers --and instruments -and any further assurances of title and will do or cause to be done all further acts and things that may be proper or reasonably necessary to carry out the purpose of this Deed of Trust and to subject to the liens any property intended by the terms to be covered and any renewals, additions, substitutions, replacements, or betterments. Section 4.8 Statement by Trustor. Trustor, on ten (10) days' written request, will furnish a statement of the amount due or outstanding on the Developer Note and a statement of any offsets, counterclaims, or defenses to the payment. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 64 551a Section 4.9 Indemnity. (a) If any action or proceeding (whether judicial, regulatory, or administrative) is threatened or commenced, except an action to foreclose this Deed of Trust or to collect the Loan: (i) that affects the Land or any portion of it; (ii) for which Beneficiary is a party; or (iii) in which it becomes necessary to defend or uphold the lien of this Deed of Trust; then all reasonable costs, fees, and expenses incurred by Beneficiary with respect to the action or proceeding (including, without limitation, reasonable attorney fees and expenses) will, within thirty (30) days after the submission of bills for the costs to Trustor, be paid directly to the billing party by Trustor. (b) In addition, Trustor agrees to pay all costs, including, without limitation, reasonable attorney fees and expenses, incurred by Beneficiary in enforcing the terms of this Deed of Trust or the Affordable Housing Agreement. Trustor agrees to indemnify and hold Beneficiary harmless from all liability, loss, damage, or expense (including, without limitation, reasonable attorney fees) that it may incur under this Deed of Trust, or in connection with the Loan secured by this Deed of Trust, the enforcement of any of Beneficiary's rights or remedies, any action taken by Beneficiary under this Deed of Trust, or by reason or in defense of any claims and demands that may be asserted against Beneficiary arising out of the Collateral, unless caused by the negligence or willful misconduct of Beneficiary. Section 4.10 Reimbursement. Beneficiary will have the right to declare immediately due any amount paid by it for any real property tax, stamp tax or assessment. Section 4.11 Litigation. Trustor will promptly give written notice to Beneficiary of any litigation commenced or threatened affecting Trustor or the Land other than unlawful detainer proceedings brought by Trustor. Section 4.12 Tax Receipts. Subject to the provisions of Section 4.4 of this Deed of Trust, Trustor will present to Beneficiary, within seven (7) days after written demand, bills (that will be receipted from and after the date receipted bills are obtainable) showing the payment to the extent then due of all taxes, assessments or any other Imposition that may have become a lien on the Land prior to the lien of this Deed of Trust. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 65 S5161 Section 4.13 Additional Information. Trustor will furnish to Beneficiary, within seven (7) days after written request, all information that Beneficiary may request concerning the performance by Trustor of the covenants of the Affordable Housing Agreement, and Trustor will permit Beneficiary or its representatives at all reasonable times to make investigation or examination concerning that performance. Section 4.14 Right of Entry. Trustor grants to Beneficiary and its agents, employees, consultants, and contractors the right to enter on the Land, subject to the rights of any tenants of the Project, for the purpose of making any inspections, reports, tests (including, without limitation, soils borings, groundwater testing, wells, or soils analysis), inquiries, and reviews that Beneficiary, in its sole and absolute discretion, deems necessary to assess the then current condition of the Land and compliance with the Affordable Housing Agreement. Beneficiary will provide Trustor with one (1) Business Day's notice of the entry. However, Trustor's consent will not be required for entry or for the performance of tests. All costs, fees, and expenses (including, without limitation, those of Beneficiary's outside counsel and consultants) incurred by Beneficiary with respect to the inspections, reports, tests, inquiries, and reviews, together with all related preparation, consultation, analyses, and review, necessary for compliance with the Security Documents, will be paid by Trustor to Beneficiary on demand, will accrue interest at the Default Rate until paid, and will be secured by this Deed of Trust, prior to any right' title, or interest in or claim on the Land attaching or accruing subsequent to the lien of this Deed of Trust or to which this Deed of Trust is not subordinated. ARTICLE 5. NEGATIVE COVENANTS Until the entire Loan has been paid in accordance with the terms of the Developer Note, Trustor covenants to and agrees with Beneficiary as follows: Section 5.1 Restrictive Uses. Trustor covenants not to initiate, join in, or consent to any change in any zoning ordinance, private restrictive covenant, assessment proceedings, or other public or private restriction inconsistent with the Affordable Housing Agreement. Section 5.2 Subordination to Other Financing. This Deed of Trust and all covenants, restrictions or regulatory agreements executed by Trustor in favor of Beneficiary in connection with the Land are expressly and shall be automatically subordinated to a deed of trust securing the repayment of construction financing for the development and construction of the Improvements. Trustor will not create or permit to continue in existence any mortgage, pledge, encumbrance, lien or charge of any kind on any of the Land except for: CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 66 551a (a) liens for taxes not yet delinquent; and (b) any other liens or charges that are specifically approved in writing by Beneficiary, including any deed of trust executed or to be executed by Trustor or Trustor's successor in interest and recorded in Riverside County, California, to secure a loan obtained for the purpose of the construction of any improvement on the Land contemplated by the Affordable Housing Agreement. Section 5.3 Transferability. One of the inducements to Beneficiary for making the Loan is the identity of Trustor. The existence of any interest in the Land other than the interests of Trustor and Beneficiary and any encumbrance permitted in this Deed of Trust, even though subordinate to the security interest of Beneficiary, and the existence of any interest in Trustor other than those of the present owners, would impair the Land and the security interest of Beneficiary, and, therefore, Trustor will not sell, convey, assign, transfer, alienate, or otherwise dispose of its interest in the Land, either voluntarily or by operation of law, or agree to do so, except in accordance with the terms of the Affordable Housing Agreement. ARTICLE 6. ENVIRONMENTAL PROVISIONS Section 6.1 Warranties and Covenants. Except as disclosed in writing to, and acknowledged in )�riting by, the Beneficiary, Trustor represents and warrants that, to the best of Trustor's knowledge, except in the ordinary course of business, during the period of Trustor's ownership of the Land: (a) there has been no use, generation, manufacture, storage, treatment, disposal, discharge, Release, or threatened Release of any Hazardous Materials by any person on or around the Land; and there have been no Hazardous Materials r ns o (b) to s t a pored over gy o e r through the Land. Trustor agrees, except in the ordinary course of business and in strict compliance with all applicable Hazardous Materials Laws, as follows: (a) not to cause or permit the Land to be used as a site for the use, generation, manufacture, storage, treatment, Release, discharge, disposal, tiansportation, or presence of any Hazardous Materials; (b) not to cause, contribute to, permit, or acquiesce In any Release or threatened Release; (c) not to change or modify the use of the Land without the prior written consent of Beneficiary; CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 67 551'G1 (d) to comply with and to cause the Land and every User of the Land to comply with all Hazardous Materials Laws; (e) to immediately notify Beneficiary in writing and to provide Beneficiary with a reasonably detailed description of: (i) any noncompliance of the Land with any Hazardous Materials Laws; (ii) any Hazardous Materials Claim; (iii) any Release or threatened Release; and (iv) the discovery of any occurrence or condition on any real property adjoining or in the vicinity of the Land that would cause the Land or any part of it to be designated as hazardous waste property or border zone property under the provisions of Health and Safety Code §§ 25220, et seq. and any regulation adopted in accordance with that section; (f) in the event that Trustor discovers a Release or the presence of any Hazardous Materials on or about the Land in violation of any Hazardous Materials Law, to: (i) notify Beneficiary of that discovery together with a reasonably detailed description; (ii) promptly after a request by Beneficiary, engage a qualified environmental engineer reasonably satisfactory to Beneficiary to investigate these matters and prepare and submit to Beneficiary a written report containing the findings and conclusions resulting from that investigation, all at the sole expense of Trustor; and (iii) take, at Trustor's sole expense, all necessary actions to remedy, repair, clean up, or detoxify any Release or Hazardous Materials, including, but not limited to, any remedial action required by any Hazardous Materials Laws or any judgment, consent, decree, settlement, or compromise in respect of any Hazardous Materials Claims, these actions to be performed: (A) (B) (C) writing by (D) writing by in accordance with Hazardous Materials Laws; in a good and proper manner, under the supervision of a qualified environmental engineer approved in Beneficiary; in accordance with plans and specifications for these actions approved in Beneficiary; and CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 68 551(1 (E) using licensed and insured qualified contractors approved in writing by Beneficiary; (g) immediately furnish to Beneficiary copies of all written communications received by Trustor from any governmental authority or other person or given by Trustor to any person and any other information Beneficiary may reasonably request concerning any Release, threatened Release, Hazardous Materials Claim, or the discovery of any Hazardous Materials on or about the Land in violation of any Hazardous Materials Law; and (h) keep Beneficiary generally informed regarding any Release, threatened Release, Hazardous Materials Claim, or the discovery of any Hazardous Materials on or about the Land in violation of any Hazardous Materials Law. Section 6.2 Inspection and Receivership Rights. Upon Beneficiary's reasonable belief that Trustor has failed to comply with any environmental provision of this Deed of Trust and upon reasonable prior notice (except in the case of an emergency) to Trustor and subject to the rights of any lessee of the Ground Lease and tenants of the Project, Beneficiary or its representatives, employees, and agents, may from time to time and at all reasonable times (or at any time in the case of an emergency) enter and inspect the Land and every part of it (including all samples of building materials, soil, and groundwater, and all books, records, and files of Trustor relating to the Land) and perform those acts and things that Beneficiary deems necessary or desirable to inspect, investigate, assess, and protect security of this Deed of Trust, for the purpose of determining: (a) the existence, location, nature, and magnitude of any Release or threatened Release; (b) the presence of any Hazardous Materials on or about the Land in violation of any Hazardous Materials Law; and (c) the compliance by Trustor of every environmental provision of this Deed of Trust. In furtherance of the purposes above, without limitation of any of its other rights, Beneficiary may: (i) obtain a court order to enforce Beneficiary's right to enter and inspect the Land under California Civil Code § 2929.5, to which the decision of Beneficiary as to whether there exists a Release, a threatened Release, any Hazardous Materials on or about the Land in violation of any Hazardous Materials Law, or a breach by Trustor of any environmental provision of this Deed of Trust, will be deemed reasonable and conclusive as between the parties; and (ii) have a receiver appointed under California Code of Civil Procedure § 564 to enforce Beneficiary's right to enter and inspect the Land for the purpose set forth above. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 69 55161 All costs and expenses incurred by Beneficiary with respect to the audits, tests, inspections, and examinations that Beneficiary or its agents, representatives, or employees may conduct, including the fees of the engineers, laboratories, contractors, consultants, and attorneys, will be paid by Trustor. All costs or expenses incurred by Trustee and Beneficiary pursuant to this subsection (including without limitation court costs, consultant's fees, and attorney fees, whether incurred in litigation and whether before or after judgment) will bear interest at the Default Rate from the date they are incurred until those sums have been paid in full. Except as provided by law, any inspections or tests made by Beneficiary or its representatives, employees, and agents will be for Beneficiary's purposes only and will not be construed to create any responsibility or liability on the part of Beneficiary to Trustor or to any other person. Beneficiary will have the right, but not the obligation, to communicate with any governmental authority regarding any fact or reasonable belief of Beneficiary that constitutes or could constitute a breach of any of Trustor's obligations under any environmental provision contained in this Deed of Trust. Section 6.3 Release and Indemnity. Trustor: (a) releases and waives any future claims against Beneficiary for indemnity or contribution in the event Trustor becomes liable for cleanup or other costs under any Hazardous Materials Laws or under any Hazardous Materials Claim, except as otherwise provided in Sections 214(3) and 214(4) of the Affordable Housing Agreement; (b) agrees to reimburse Beneficiary, on demand, for all costs and expenses incurred by Beneficiary in connection with any review, approval, consent, or inspection relating to the environmental provisions in this Deed of Trust together with interest, after demand, in accordance with Section 214(3) of the Affordable Housing Agreement; and (c) agrees to indemnify, defend, and hold Beneficiary and Trustee harmless from all losses, costs, claims, damages, penalties, liabilities, causes of action, judgments, court costs, attorney fees and other legal expenses, costs of evidence of title, cost of evidence of value, and other expenses as set forth in Section 214(3) of the Affordable Housing Agreement. Section -6.4--- Request for Information __-__- .---._._.- --------------------- ----------- _ __---._ _ Trustor and Beneficiary agree that: (a) this Section 6.4 is intended as Beneficiary's written request for information and Trustor's written response concerning the environmental condition of the Land as provided by California Code of Civil Procedure § 726.5; and (b) each representation, warranty, covenant, or indemnity made by Trustor in this Article or in any other provision of this Deed of Trust that relates to the environmental condition of the Land is intended by Trustor and Beneficiary to be an environmental provision for purposes of.California Code of Civil Procedure § 736 and will survive the payment of the Loan and the termination or expiration of this Deed of Trust will not be affected by Beneficiary's acquisition of any interest in the Land, whether by full credit bid at foreclosure, deed in lieu of that, or CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 70 55161 otherwise. If there is any transfer of any portion of Trustor's interest in the Land, any successor -in -interest to Trustor agrees by its succession to that, interest that the written request made pursuant to this Article will be deemed remade to the successor -in -interest without any further or additional action on the part of Beneficiary and that by assuming the debt secured by this Deed of Trust or by accepting the interest of Trustor subject to the lien of this Deed of Trust, the successor remakes each of the representations and warranties in this Deed of Trust and agrees to be bound by each covenant in this Deed of Trust, including, but not limited to, any indemnity provision. ARTICLE 7. CASUALTIES AND CONDEMNATION Section 7.1 Casualties. (a) Trustor will promptly notify Beneficiary in writing after any loss or damage caused by defect in Trustor's title to the Land and Trustor will furnish to Beneficiary within ninety (90) days after the loss or damage the following: (i) evidence satisfactory to Beneficiary that such defect is cured; and (ii) evidence satisfactory to Beneficiary that sufficient funds are available or committed for the benefit of Beneficiary, including insurance proceeds, to secure the repayment of the full amount of the Loan if such repayment is not waived. Subject to the rights of Trustor's construction and permanent lender(s), all insurance proceeds shall be applied and used to restore, repair and rebuild the Improvements in accordance with the provisions of the Affordable Housing Agreement. Any proceeds not used for the repair, restoration, modification or improvement of the Land or the repayment of the construction or permanent loan(s) may be applied at the election of the Beneficiary against the Loan. Section 7.2 Condemnation. Trustor, immediately upon obtaining knowledge of the institution of any proceedings for -the-condemnation-ef the -Land- or- any portion of it, will notify Trustee and Beneficiary of the pendency of the proceedings. Trustee and Beneficiary may participate in any proceedings and Trustor from time to time will deliver to Beneficiary all instruments requested by Beneficiary to permit participation. Beneficiary will be under no obligation to question the amount of any award or compensation. In any condemnation proceedings, Beneficiary may be represented by counsel selected by Beneficiary. The proceeds of any award or compensation received will be applied pursuant to the provisions of the construction or permanent loan documents and provisions of Section 7.1 of this Deed of Trust. ARTICLE 8. EVENTS OF DEFAULT AND REMEDIES Section 8.1 Events of Default. The following events are each an Event of Default: CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 71 55161 (a) Default in the payment of any sum of principal when due and not waived under the Developer Note which is not cured within the applicable cure period set forth therein; (b) A default under the Affordable Housing Agreement which is not cured within the applicable cure period set forth therein; (c) The failure (without cure during the applicable period) of the Trustor to observe, perform, or discharge any obligation, term, covenant, or condition of this Deed of Trust; (d) the sale, hypothecation, conveyance, or other disposition of the Land except in accordance with Sections 5.2 or 5.3 of this Deed of Trust or the Affordable Housing Agreement; and (e) Any representation or warranty made by Trustor or any other Person under this Deed of Trust is false or misleading in any material respect as of the date on which the representation or warranty was made. If one or more Events of Default occurs and are continuing, then Beneficiary may declare all the Loan to be due and the Loan will become due without any further presentment, demand, protest, or notice of any kind, and Beneficiary may: (i) in person, by agent, or by a receiver, and without regard to the adequacy of security, the solvency of Trustor, or the existence of waste, enter on and take possession of the Land or any part of it in its own name or in the name of Trustee, sue for or otherwise collect the rents, issues, and profits, and apply them, less costs and expenses of operation and collection, including reasonable attorney fees, upon the Loan, all in any order that Beneficiary may determine. The entering on and taking possession of the Land, the collection of rents, issues, and profits, and the application of them will not cure or waive any default or notice of default or invalidate any act done pursuant to the notice; (ii) commence an action to foreclose this Deed of Trust in the manner provided by law for the foreclosure of mortgages of real property; (iii) deliver to Trustee a written declaration of default and demand for sale, and a written notice of default and election to cause the Land to be sold, which notice Trustee or Beneficiary will cause to be filed for record; (iv) with respect to any Personalty, proceed as to both the real and personal property in accordance with Beneficiary's rights and remedies in respect of the Land, or proceed to sell the Personalty separately and without regard to the Land in accordance with Beneficiary's rights and remedies; or (v) exercise any of these remedies in combination or any other remedy at law or in equity. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 72 55161 Section 8.2 Power of Sale. (a) If Beneficiary elects to foreclose by exercise of the power of sale in this Deed of Trust, Beneficiary will also deposit with Trustee this Deed of Trust, the Developer Note, and any receipts and evidence of expenditures made and secured as Trustee may require. If notice of default has been given as then required by law, and after lapse of the time that may then be required by law, after recordation of the notice of default, Trustee, without demand on Trustor, will, after notice of sale having been given as required by law, sell the Land at the time and place. of sale fixed by it in the notice of sale, either as a whole or in separate parcels as Trustee determines, and in any order that it may determine, at public auction to the highest bidder. Trustee may postpone sale of all or any portion of the Land by public announcement at the time and place of sale; and from time to time after that may postpone the sale by public announcement at the time fixed by the preceding postponement, and without further notice make the sale at the time fixed by the last postponement; or Trustee may, in its discretion, give a new notice of sale. Beneficiary may rescind any notice of default at any time before Trustee's sale by executing a notice of rescission and recording it. The recordation of the notice will constitute a cancellation of any prior declaration of default and demand for sale and of any acceleration of maturity of the Loan affected by any prior declaration or notice of default. The exercise by Beneficiary of the right of rescission will not constitute a waiver of any default then existing or subsequently occurring, or impair the right of Beneficiary to execute other declarations of default and demand for sale, or notices of default and of election to cause the Land to be sold, nor otherwise affect the Developer Note or this Deed of Trust,, or any of the rights, obligations, or remedies of Beneficiary or Trustee. After sale, Trustee will deliver to the purchaser its deed conveying the property sold, but without any covenant or warranty, express or implied. The recitals in the deed of any matters or facts will be conclusive proof of their truthfulness. Any Person, including Trustor, Trustee, or Beneficiary, may purchase at that sale. If allowed by law, Beneficiary, if it is the purchaser, may turn in the Developer Note at the amount owing on it toward payment of the purchase price (or for endorsement of the purchase price as a payment on the Developer Note if the amount owing exceeds the purchase price). Trustor expressly waives any right of redemption after sale that Trustor may have at the time of sale or that may apply to the sale. - (b) Trustee, upon the sale, will make (without any covenant or warranty, express or implied), execute and, after due payment made, deliver to a purchaser and its heirs or assigns a - -----deed or -other -record -of interest; --as- the--ease-may-be;-to-the-Land -sold, -which -will convey to the purchaser all the title and interest of Trustor in the Land and will apply the proceeds of the sale in payment: (i) first, of the expenses of the sale together with the expenses of the trust, including, without limitation, attorney fees, that will become due on any default made by Trustor, and also any sums that Trustee or Beneficiary have paid for procuring a search of the title to the Land subsequent to the execution of this Deed of Trust; and (ii) second, in payment of the Loan then remaining unpaid, and the amount of all other monies with interest in this Deed of Trust agreed or provided to be paid by Trustor. Trustee will pay the balance or surplus of the proceeds of sale to Trustor and its successors or assigns as its -interests may appear. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 73 Section 8.3 Proof of Default. If there is a sale of the Land, or any part of it, and the execution of a deed for it, the recital of default and of recording notice of breach and election of sale, and of the elapsing of the required time between the recording and the following notice, and of the giving of notice of sale, and of a demand by Beneficiary that the sale should be made, will be conclusive proof of the default, recording, election, elapsing of time, and the due giving of notice, and that the sale was regularly and validly made on proper demand by Beneficiary. Any deed with these recitals will be effectual and conclusive against Trustor, its successors, and assigns, and all other Persons. The receipt for the purchase money recited or in any deed executed to the purchaser will be sufficient discharge to the purchaser from all obligations to see to the proper application of the purchase money. Section 8.4 Protection of Security. If an Event of Default occurs and is continuing, Beneficiary or Trustee, without limitation to do so, without notice to or demand upon Trustor, and without releasing Trustor from any obligations or defaults may: (a) enter on the Land in any manner and to any extent that either deems necessary to protect the security of this Deed of Trust; (b) appear in and defend any action or proceeding purporting to affect, in any manner, the Obligations or the Loan, the security of this Deed of Trust, or the rights or powers of Beneficiary or Trustee; (c) pay, purchase, or compromise any encumbrance, charge, or lien that in the judgment of Beneficiary or Trustee is prior or superior to this Deed of Trust; and (d) pay necessary expenses, employ counsel, and pay reasonable attorney fees. Trustor agrees to repay on demand all sums expended by Trustee or Beneficiary pursuant to this section with interest at the Default Rate, and those sums, with interest, will be secured by this Deed of Trust. Section 8.5 Receiver. If an Event of Default occurs and is continuing, Beneficiary, as a matter of strict right and without notice to Trustor or anyone claiming under Trustor and without regard to the then value of the Land, will have the right to apply ex parte to any court having jurisdiction to appoint a Receiver of the Land, and Trustor waives notice of any application for that, provided a hearing to confirm the appointment with notice to Trustor is set within fourteen (14) days after the appointment. Any Receiver will have all the powers and duties of receivers in similar cases and all the powers and duties of Beneficiary in case of entry as provided in this Deed of Trust, and will continue as such and exercise all those powers until the date of confirmation of sale, unless the receivership is terminated sooner. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 74 55161 Section 8.6 Curing the Defaults. If Trustor at any time fails to perform or comply with any of the terms, covenants, and conditions required on Trustor's part to be performed and complied with under this Deed of Trust or the Developer Note, Trustor is required to perform, then Beneficiary, after seven (7) Business Days' notice to Trustor (or without notice if Beneficiary determines that an emergency exists), and without waiving or releasing Trustor from any of the Obligations, may, subject to the provisions of any of the Security Documents: (a) make from its own funds any payments payable by Trustor and take out, pay for, and maintain any of the insurance policies provided for; and (b) perform any other acts on the part of Trustor to be performed and enter on the Land for that purpose. The making by Beneficiary of payments out of Beneficiary's own funds will not, however, be deemed to cure the default by Trustor, and they will not be cured unless and until Trustor reimburses Beneficiary for the payments. All sums paid and all reasonable costs and expenses incurred by Beneficiary in connection with the performance of any act, together with interest on unpaid balances at the Default Rate from the respective dates of Beneficiary's making of each payment, will be added to the principal of the Loan, will be secured by the Security Documents and by the lien of this Deed of Trust, prior to any right, title, or interest in or claim on the Land attaching or accruing subsequent to the lien of this Deed of Trust, and will be payable by Trustor to Beneficiary on demand. Section 8.7 Inspection Rights. On reasonable notice (except in the case of an emergency), and without releasing Trustor from any obligation to cure any default of Trustor, Beneficiary or its agents, representatives, and employees acting by themselves or through a court -appointed receiver, may, from time to time and at all reasonable times (or at any time in the case of an emergency) enter and inspect the Land and every part of it and perform any acts and things as Beneficiary deems necessary or desirable to inspect, investigate, assess, and protect the security of this Deed of Trust, for the ---purpose-of dete-rmi-ning-compllanc€—with-covenants and -restrictions -contained -this Deed of Trust. Section 8.8 Judgment on Environmental Provision. Beneficiary or its agents, representatives, and employees may seek a judgment that Trustor has breached its covenants, representations, or warranties in Article 6 of this Deed of Trustor any other covenants, representations, or warranties that are deemed to be environmental provisions pursuant to California Code of Civil Procedure § 736 (each an Environmental Provision), by commencing and maintaining an action or actions in any court of competent jurisdiction pursuant to California Code of Civil Procedure § 736, whether commenced prior to or after foreclosure of the lien of this Deed of Trust. Beneficiary or its agents, representatives, and employees may also seek an injunction to cause Trustor to abate any action in violation of any Environmental Provision and may seek the recovery of all costs, damages, expenses, fees, penalties, fines, judgments, indemnification payments to third parties, and other out-of-pocket CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 75 55161 costs or expenses actually incurred by Beneficiary (collectively, "Environmental Costs") incurred or advanced by Beneficiary relating to the cleanup, remedy, or other response action required by any Hazardous Materials Law, or any Hazardous Materials Claim, or which Beneficiary believes necessary to protect the Land. It will be conclusively presumed between Beneficiary and Trustor that all Environmental Costs incurred or advanced by Beneficiary relating to the cleanup, remedy, or other response action of or to the Land were made by Beneficiary in good faith. All Environmental Costs incurred by Beneficiary under this subsection (including, without limitation, court costs, consultant fees, and reasonable attorney fees, whether incurred in litigation and whether before or after judgment) will bear interest at the legal rate from the date of expenditure until those sums have been paid in full. Beneficiary will be entitled to bid, at any trustee's or foreclosure sale of the Land, the amount of the costs, expenses, and interest in addition to the amount of the Loan. Section 8.9 Waive Lien. Beneficiary or its agents, representatives, and employees may waive its lien against the Land or any portion of it, including the Improvements and the Land, to the extent that the Land is found to be environmentally impaired in accordance with California Code of Civil Procedure § 726.5, and to exercise all rights and remedies of an unsecured creditor against Trustor and all of Trustor's assets and property for the recovery of any deficiency and Environmental Costs, including, but not limited to, seeking an attachment order under California Code of Civil Procedure § 483.010. As between Beneficiary and Trustor, for purposes of California Code of Civil Procedure § 726.5, Trustor will have the burden of proving that Trustor or any related party (or any affiliate or agent of Trustor or any related party) was not in any way negligent in permitting the Release or threatened Release of the Hazardous Materials. Section 8.10 Remedies Cumulative. All remedies of Beneficiary provided for in this Deed of Trust are cumulative and will be in addition to all other rights and remedies provided in the other Security Documents or provided by law, including any banker's lien and right of offset. The exercise of any right or remedy by Beneficiary will not in any way constitute a cure or waiver of default, will not invalidate any act done pursuant to any notice of default, nor will it prejudice Beneficiary in the exercise of any of --its-rights-unless-, in the exercise of those rights, Beneficiary collects the total amount of the Loan. -- ARTICLE 9. SECURITY AGREEMENT Section 9.1 Security Interest. The security interest includes all policies of insurance arising out of the ownership of the Land, and all accounts, contract rights, chattel paper, instruments, general intangibles, and other obligations of any kind now or later existing, arising out of, or in connection with the ownership and maintenance of the Land (the "Collateral"). The security interest also includes all rights now or later existing in all security agreements, leases, and other contracts securing or otherwise relating to any accounts, contract rights, chattel paper, instruments, general intangibles, or obligations; all causes of action and recoveries now or later existing for any loss or diminution in CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 76 55161 value of the Land; all proceeds of any of the Land; and, to the extent not otherwise included, all payments under insurance (whether Beneficiary is the loss payee), or any indemnity, warranty, or guaranty payable by reason of loss or damage to or otherwise with respect to any of the Collateral. Section 9.2 Remedies. Trustor agrees to execute and deliver on demand, and irrevocably constitutes and appoints Beneficiary the attorney -in -fact of Trustor to execute, deliver, and file, any security agreements, financing statements, continuation statements, or other instruments that Beneficiary may request to impose, perfect, or continue the perfection of the lien or security interest created by this Deed of Trust. Beneficiary has all rights and remedies, whether at law, in equity, or by statute that are available to secured creditors. Any disposition may be conducted by an employee or agent of Beneficiary or Trustee. Any Person, including both Trustor and Beneficiary, will be eligible to purchase any part or all of the Collateral at any disposition. Section 9.3 Expenses. Expenses of retaking, holding, and preparing for sale, selling, or the like will be borne by Trustor and will include. Beneficiary's and Trustee's attorney fees and legal expenses. Trustor, on demand of Beneficiary, will assemble the Collateral and make it available to Beneficiary at the Land, a place deemed to be reasonably convenient to Beneficiary and Trustor. Beneficiary will give Trustor at least ten (10) days' prior written notice of the time and place of any public sale or other disposition of the Collateral or of the time of or after which any private sale or any other intended disposition is to be made. If the notice is sent to Trustor in the manner provided for the mailing of notices in this Deed of Trust, it is deemed reasonable notice to Trustor. Section 9.4 Assignment of Agreements. (a) As security for the Loan, Trustor sells, assigns, transfers, sets over, and delivers to Beneficiary (subject to the prior rights of any construction or permanent lender(s)) all of Trustor's right, title, and interest in all agreements, permits, and contracts pertaining to the --ownership and- Maintenance -of the- Land., including, -but-not limited -to, environme-ntal impact -- reports; negative declarations; map approvals; grading permits; conditional use permits; applications for all permits; management agreements; all development rights in the Land that Trustor may now or later acquire (including, without limitation, development rights arising in connection with any action by a governmental entity, including, by way of illustration, but not of limitation, inducement resolutions of county, municipal, or other governmental entities); agreements with contractors, suppliers, and construction managers; and agreements pertaining to the transfer of development rights or permitted floor area under applicable laws or ordinances (collectively, "Agreements"), as they may be amended or otherwise modified from time to time, including, without limitation, the right of Trustor to terminate any of the Agreements, to perform under them, and to compel performance and otherwise exercise all remedies under them, together with the immediate and continuing right to collect and receive all sums that may become due to Trustor, or which Trustor may now or later become entitled to demand or claim, arising or issuing out of the Agreements, including, without limitation, claims of Trustor for damages CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 77 55161 arising out of breach of or default under any of the Agreements and all rights of Trustor to receive proceeds of any insurance, indemnity, warranty, or guaranty with respect to any of the Agreements. However, so long as no Event of Default has occurred and is continuing, Trustor will have the right under a license granted to collect and retain all sums that may become payable to Trustor under the Agreements. (b) Trustor covenants and agrees to punctually observe, perform, and discharge the obligations, terms, covenants, conditions, and warranties to be observed, performed, and discharged by it under the Agreements. Beneficiary, upon an Event of Default, at its option and upon written notice to Trustor, will have the right to declare the assignment in this Section 9.4 to be absolute, and, in addition, Beneficiary will have the complete right then or later to exercise and enforce all of the rights and remedies provided by law. (c) The acceptance by Beneficiary of the assignment in this Article 9.5, with all the rights, powers, privileges, and authority granted will not, prior to the exercise of Beneficiary's right to declare the assignment in this Article 9.4 to be absolute, obligate Beneficiary to assume any obligations under the Agreements or to take any action under them, or to expend any money or incur any expense or perform or discharge any obligation, duty, or liability under the Agreements, or to assume any obligation or responsibility for the nonperformance of the provisions by Trustor. ARTICLE 10. ASSIGNMENT OF LEASES AND RENTS Section 10.1 Assignment. Trustor irrevocably assigns to Beneficiary: (a) all of Trustor's right, title, and interest in all leases; licenses; agreements relating to the management, leasing, or operation of the Land; and other agreements of any kind relating to the use or occupancy of the Land, whether now existing or entered into after the date of this Deed of Trust; and --------.(b).-----the-rents-, issues,--and-profits-4--the- Land; including, -without- limitations -all- --- amounts payable and all rights and benefits accruing to Trustor under any leases (the "Payments"), for the purposes and on the terms and conditions below. This is a present and absolute assignment, not an assignment for security purposes only, and Beneficiary's right to the leases and payments is not contingent on, and may be exercised without, possession of the Land. Section 10.2 License. Beneficiary confers on Trustor a license (the "License") to collect and retain the Payments as they become due until the occurrence of an Event of Default. Upon an Event of Default, the License will be automatically revoked and Beneficiary may collect and retain the Payments without notice and without taking possession of the Land. The lessees will have no right or duty to inquire as to whether any Default has actually occurred or is then existing. Trustor relieves the lessees from any liability to Trustor by reason of relying on and complying with any notice or demand by Beneficiary. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 78 55161 Section 10.3 Effect of Assignment. The assignment will not impose on Beneficiary any duty to produce rents, issues, or profits from the Land, or cause Beneficiary to be: (a) a mortgagee -in -possession for any purpose; (b) responsible for performing any of the obligations of the lessor under any leases; or (c) responsible for any waste committed by lessees or any other parties, any dangerous or defective condition of the Land, or any negligence in the management, upkeep, repair, or control of the Land. Beneficiary will not be liable to Trustor or any other party as a consequence of the exercise of the rights granted to Beneficiary under this assignment. Section 10.4 Leasing Covenants. Trustor covenants and agrees as follows: (a) At Trustor's sole cost to: (i) perform all obligations of the lessor under the any leases and enforce performance by the lessees of their obligations under such leases; (ii) subject to the provisions of Section 10.4(b) below, enforce all remedies available to Trustor in case of default by the lessees under the leases and prosecute and defend any action, arbitration, or other controversy relating to the leases or to Trustor's interest in the leases; (iii) exercise diligent, good -faith efforts to keep all portions of the Land, if applicable, leased at all times and at rental rates set forth in the Affordable Housing .._.--------Agreement; and---- - (iv) promptly upon execution, deliver to Beneficiary fully executed counterpart originals of the leases; and (b) except in compliance with the terms of the Affordable Housing Agreement, not to enter into, assign, terminate, modify, or amend the terms of, any leases, or to assign the Payments, or to subordinate the leases to any other deed of trust or encumbrances. Any attempted action in violation of the provisions of this Section 10.4(b) will be voidable at Beneficiary's election. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 79 55161 Section 10.5 Application of Rents. Beneficiary, in its sole discretion, may apply, or require the application of, all amounts received pursuant to the assignment to the payment of any one or more of the obligations in any order that Beneficiary may elect. Section 10.6 Remedies. In addition to any other remedies in this Deed of Trust, Beneficiary will have the following rights and remedies upon the occurrence of an Event of Default: (a) To receive the Payments and any other amounts arising or accruing under the leases or from the Land; (b) To collect, sue for, settle, compromise, and give releases for the Payments and pursue any remedies for the enforcement of the leases or Trustor's rights under the leases; and (c) To take possession of the Land, and hold, manage, lease, and operate it on any terms and for any period of time that Beneficiary may deem proper and, either with or without taking possession of the Land, in its own name, make from time to time all alterations, renovations, repairs, or replacements that Beneficiary may deem proper. Section 10.7 Definitions. The terms lessor and lessors as used in this Deed of Trust will include all owners, landlords, licensors, and other parties in a similar position with respect to the leases. The terms lessee and lessees will include any tenants and licensees and any other parties in a similar position and will also include any guarantor or other obligors under the leases. ARTICLE 11. MISCELLANEOUS Section 11.1 Successor Trustee. Beneficiary may remove Trustee or any successor trustee at any time and appoint a successor trustee by recording a written substitution in the county where the Land is located, or in any other manner permitted by law. Upon that appointment, all of the powers, rights, and authority of Trustee will immediately become vested in the successor. Section 11.2 No Waiver. No waiver by Beneficiary of any default or breach. by Trustor will be implied from any omission by Beneficiary to take action on account of that default if the default persists or is repeated. Also, no express waiver will affect any default other than the default in the waiver and the waiver will be operative only for the time and to the extent stated. Waivers of any covenant, term, or condition in this Deed of Trust will not be construed as a waiver of any subsequent CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 80 55161 breach of the same covenant, term, or condition. The consent or approval by Beneficiary for any act by Trustor requiring further consent or approval will not be deemed to waive or render unnecessary the consent or approval for any subsequent similar act. Section 11.3 Abandonment. Subject to any chattel mortgages, security agreements, or other liens on title that may exist with the consent of Beneficiary, or any provided for in this Deed of Trust, all Personalty that upon foreclosure of the Land is owned by Trustor and is used in connection with the maintenance of the Land will be deemed at Beneficiary's option to have become on that date a part of the Land and abandoned to Beneficiary in its then condition. Section 11.4 Notices. All notices, advices, demands, requests, consents, statements, satisfactions, waivers, designations, refusals, confirmations, or denials that may be required or contemplated under this Deed of Trust for any party to serve on or give to any other will be in writing, and, if not in writing, will not be deemed to have been given. Also, they must be either personally served or sent with return receipt requested by registered or certified mail with postage (including registration or certification charges) prepaid in a securely enclosed and sealed envelope as follows: (a) If to Trustor, addressed to: Catellus Residential Group, Inc. 5 Park Plaza, Suite 400 Irvine, California 92660 Attention: John O'Brien (b) If to Beneficiary, addressed to: La Quinta Redevelopment Agency 78-495 Calle Tampico La Quinta, California 92253 Attention: Executive Director Section 11.5 Survival. The covenants and agreements in this Deed of Trust will bind and inure to the benefit of Beneficiary and Trustor and their successors and assigns. It is agreed that Beneficiary may assign to or grant a participation in any one or more lenders, free from any right of counterclaim, recoupment, or setoff, by Trustor, Beneficiary's rights and obligations in whole or in part under the Security Documents. Nothing in this Section 11.5 is intended to limit other provisions in the Enforcement Documents that by their terms survive the repayment of the Loan or the termination of any Security Document. Section 11.6 Severability. If any term, provision, covenant, or condition of this Deed of Trust or any application of it is held by a court of competent jurisdiction to be invalid, void, or unenforceable, in whole or CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 81 55161 in part, all terms, provisions, covenants, and conditions of this Deed of Trust and all applications of it not held invalid, void, or unenforceable will continue in full force and will not be affected, impaired, or invalidated. Section 11.7 References to Foreclosure. References in this Deed of Trust to foreclosure and related phrases are references to the appropriate procedure in connection with Trustee's private power of sale, any judicial foreclosure proceeding, and any deed given in lieu of foreclosure. Section 11.8 Joinder of Foreclosure. If Beneficiary holds any other or additional security for the payment of any Loan or performance of any Obligation, its sale or foreclosure, on any default in the payment or performance, in Beneficiary's sole discretion, may be prior to, subsequent to, or joined or otherwise contemporaneous with any sale or foreclosure. In addition to the rights in this Deed of Trust specifically conferred, Beneficiary, at any time and from time to time, may exercise any right or remedy now or later given by law to beneficiaries under deeds of trust generally, or to the holders of any obligations of the kind secured. Section 11.9 Rights of Beneficiary and Trustee. At any time and from time to time, without liability and without notice, and without releasing or otherwise affecting the liability of any person for payment of any of the Loan: (a) Beneficiary, at its sole discretion and only in writing, may extend the time for or release any Person now or later liable for payment of any of the Loan, or accept or release additional security, or subordinate the lien or charge of this Deed of Trust; or (b) Trustee, on written request of Beneficiary and presentation of the Developer Note, any additional notes secured by this Deed of Trust, and this Deed of Trust for endorsement, may reconvey any part of the Land, consent to the making of any map or plat of it, join in granting any easement on it, or join in any agreement of extension or subordination. On Beneficiary's written request and surrender of the Developer Note, any additional notes secured by this Deed of Trust, and this Deed of Trust to Trustee for cancellation, and on payment to Trustee of its fees and expenses, Trustee will reconvey without warranty the then trust property. The recitals in any reconveyance will be conclusive proof of the truthfulness of them, and the grantee in any reconveyance may be described as the person legally entitled. Section 11.10 Copies. Trustor will promptly give to Beneficiary copies of: (a) all notices of violation that Trustor receives from any governmental agency or authority; and (b) all notices of default that Trustor receives under the Bond Documents. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 82 55161 Section 11.11 Subordination to Contracts of Sale and Leases. At the option of Beneficiary, this Deed of Trust will become subject and subordinate, in whole or in part (but not with respect to priority of entitlement to any insurance proceeds, damages, awards, or compensation resulting from damage to the Land or condemnation or exercise of power of eminent domain), to any contracts of sale or any leases of the Land on the execution by Beneficiary and recording of a unilateral declaration to that effect in the official records of the county and state where the Land is located. Beneficiary may require the issuance of any title insurance endorsements to the Title Policy in connection with any subordination that Beneficiary, in its judgment, determines are appropriate, and Trustor will be obligated to pay any cost or expense incurred in connection with the issuance. Section 11.12 No Merger. So long as any of the Loan remains unpaid or Beneficiary has any further obligation under the Security Documents, unless Beneficiary otherwise consents in writing, the fee estate of Trustor in the Land or any part of it will not merge, by operation of law or otherwise, with any leasehold or other estate in the Land or any part of it, but will always be kept separate and distinct, regardless of the union of the fee estate and the leasehold or other estate in Trustor or any other Person. Section 11.13 Performance by Trustor. Trustor will faithfully perform every covenant to be performed by Trustor under any lien or encumbrance, including, without limiting the generality of this Deed of Trust, mortgages, deeds of trust, leases, declarations or covenants, conditions and restrictions, and other agreements that affect the Land, in law or in equity, that Beneficiary reasonably believes may be prior and superior to or on a parity with the lien or charge of this Deed of Trust. A breach of or a default under any lien or encumbrance that exists after any applicable grace period in the pertinent instrument has expired without that breach or default having been cured, will constitute an Event of Default under this Deed of Trust. If Trustor fails to do so, Beneficiary, without demand or notice and in its sole judgment, may do any things required by Trustor by any of the provisions in this Deed of Trust and incur and pay expenses in connection with such provisions. Nothing in this section affects Trustor's obligations pursuant to Sections 5.2 and 5.3 of this Deed of Trust or limits Beneficiary's rights. Section 11.14 Junior Liens. Trustor agrees: (a) that as of the date of this Deed of Trust there are no encumbrances to secure debts junior to this Deed of Trust; and (b) that there are to be none as of the date when this Deed of Trust becomes of I ecord. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 83 55161 Section 11.15 Waiver of Statute of Limitations. The pleading of any statute of limitations as a defense to any obligations secured by this Deed of Trust is waived, to the fullest extent permissible by law. Section 11.16 Charges for Statements Trustor agrees to pay Beneficiary's reasonable charge, to the maximum amount permitted by law, for any statement regarding the obligations secured by this. Deed of Trust requested by Trustor or on its behalf. Section 11.17 Waiver of Marshaling Rights. Trustor, for itself and for all parties claiming through or under Trustor, and for all parties who may acquire a lien on or interest in the Land, waives all rights to have the Land or any other property that is now or later may be security for any Obligation ("Other Land") marshaled on any foreclosure of this Deed of Trust or on a foreclosure of any other security for any of the Obligations. Beneficiary will have the right to sell, and any court in which foreclosure proceedings may be brought will have the right to order a sale of, the Land and any of the Other Land as a whole or in separate parcels, in any order that Beneficiary may designate. Section 11.1 S Acceptance of Trust; Powers and Duties of Trustee. Trustee accepts this trust when this Deed of Trust is recorded. From time to time on written request of Beneficiary and presentation of this Deed of Trust for endorsement, and without affecting the personal liability of any person for payment of any indebtedness or the performance of any obligations, Trustee may, without liability and without notice: (a) reconvey all or any part of the Land; (b) consent to the making of any map or plat; and (c) join in any grant of easement, any declaration of covenants, conditions, and restrictions, any extension agreement, or any agreement subordinating the lien or charge of this - - Deed of Trust. Except as may be required by applicable law, Trustee or Beneficiary may from time to time apply to any court of competent jurisdiction for aid and direction in the execution of the trust and the enforcement of the rights and remedies available, and may obtain orders or decrees directing, confirming, or approving acts in the execution of the trust and the enforcement of the remedies. Trustee has no obligation to notify any party of any pending sale or any action or proceeding, including, without limitation, actions in which Trustor, Beneficiary, or Trustee will be a party, unless held or commenced and maintained by Trustee under this Deed of Trust. Trustee will not be obligated to perform any act required of it under this Deed of Trust unless the performance of the act is requested in writing and Trustee is reasonably indemnified and held harmless against any loss, cost, liability, or expense. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 84 55161 Section 11.19 Releases Extensions. Modifications. and Additional Security. Without notice to or the consent, approval, or agreement of any persons or entities having any interest at any time in the Land or in any manner obligated under the Obligations (the "Interested Parties"), Beneficiary may, from time to time, release any person or entity from liability for the payment or performance of any Obligation; take any action or make any agreement extending the maturity or otherwise altering the terms or increasing the amount of any Obligation; or accept additional security or release the Land or other security for any Obligation. None of these actions will release or reduce the personal liability of any of the Interested Parties, or release or impair the lien of this Deed of Trust, or the priority of it on the Land. However, no action taken or agreement made by Beneficiary to extend the maturity or otherwise alter the terms or increase the amount of any Obligation will be binding on Trustor without Trustor's consent. Section 11.20 Reconveyance. Upon the payment of the Loan and performance of all Obligations, including, without limitation, Beneficiary's receipt of all sums owing and outstanding under the Developer Note, unless waived by the Beneficiary under the terms of the Developer Note, Beneficiary will deliver to Trustee a written request for reconveyance, and will surrender to Trustee for cancellation this Deed of Trust and any note or instrument evidencing the Loan and the Obligations. However, Beneficiary will have no obligation to deliver the written request and documents until Beneficiary has been paid by Trustor, in immediately available funds, all escrow, closing, and recording costs, the costs of preparing and issuing the reconveyance, and any trustee's or reconveyance fees. On Trustee's receipt of the written request by Beneficiary and the documents, Trustee will reconvey, without warranty, the Land or that portion then held. To the extent permitted by law, the reconveyance may describe the grantee as the person or persons legally entitled and the recitals of any matters or facts in any reconveyance will be conclusive proof of the truthfulness of them. Neither Beneficiary nor Trustee will have any duty to determine the rights of persons claiming to be rightful grantees of any reconveyance. When the Land has been fully reconveyed, the last reconveyance will operate as a reassignment of all future rents, issues, and profits of the Land to the person legally entitled. ------Section Beneficiary's rights will be subrogated to the lien of all encumbrances, whether released of record, paid in whose or in part by Beneficiary pursuant to this Deed of Trust, or by the proceeds of the Loan secured by this Deed of Trust. Section 11.22 Obligations of Trustor Joint and Several. If more than one person has executed this Deed of Trust as Trustor, the obligations of all those persons will be joint and several. Section 11.23 Rules of Construction. When the identity of the parties or other circumstances make it appropriate, the singular number includes the plural. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 85 55161 Section 11.24 Successors in Interest. The terms, covenants, and conditions in this Deed of Trust will be binding on and inure to the benefit of the heirs, successors, and assigns of the parties. Section 11.25 No Offset. Trustor will pay to Beneficiary all amounts owing, if not waived, under the Developer Note, this Deed of Trust, or any of the other Obligations without deduction, offset, or counterclaim of any kind. Section 11.26 Governing Law. The parties expressly agree that this Deed of Trust (including, without limitation, all questions regarding permissive rates of interest) will be governed by or construed in accordance with the laws of the State of California. Section 11.27 Partial Reconveyances. Upon thirty (30) days' prior written request by Trustor to Beneficiary requesting that a Restricted Unit (as defined in the Affordable Housing Agreement) or any portion of the Land be reconveyed in connection with the sale of a Restricted Unit to an Eligible Person or Family (as provided in the Affordable Housing Agreement), Beneficiary shall cause such Restricted Unit to be released from the lien of this Deed of Trust by depositing a request for reconveyance into an escrow opened by or for Trustor in connection with the sale of each Restricted Unit, and the principal amount of the Developer Note shall be reduced as provided therein. In Witness Whereof, Trustor has executed this Deed of Trust as of the day and year first above written. TRUSTOR: CATELLUS RESIDENTIAL GROUP, INC., --- - ----- --- -- - - --- - - - -- - —a Cali€ornia corporation- -- - - - By: Its: CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 86 551GI EXHIBIT "A" LEGAL DESCRIPTION All that portion of the Southeast quarter of Section 29, Township 5 South, Range 7 East, San Bernardino Meridian, in the City of La Quinta, County of Riverside, State of California, described as follows: Commencing at the southeast corner of said Section 29; Thence North 89°16'l8" West, a distance of 330.44 feet along the South line of said Section 29, also being the centerline. of Avenue 48; Thence North 00°43'42" East, a distance of 56.61 feet to a point in the North line of said Avenue 48, said point being the point of beginning. Thence North 00°43'42" East, a distance of 125.39 feet; Thence North 89' 16' 18" West, a distance of 52.00 feet; Thence North 00643'42' East, a distance of 487.00 feet; Thence North 89'1618" West a distance of 523.12 feet to the beginning of a tangent curve, concave southerly and having a radius of 220.00 feet; Thence westerly along said curve through a central angle of 20'1837", an arc distance of 77.99 feet to a point in a non -tangent line; Thence north 19°34'55" West, a distance of 100.54 feet; Thence North 45°12'34" West, a distance of 141.00 feet; Thence North 43°58'19" West, a distance of 27.01 feet to the beginning of a non -tangent curve concave southeasterly and having a radius of 61 feet, a radial through said point bears north 45°12'34" west; Thence northeasterly along said curve through a central angle of 38°48'45", an arc distance of 41.32 feet to a point in a non -tangent line; Thence North 05'05'11" West, a distance of 70.35 feet; Thence North 45612'34" West, a distance of 71.72 feet to a point in the East line of the Coachella Valley Water District La Quinta Evacuation Channel; Thence North 44°47'26" East, a distance of 26.82 feet; Thence South 89640'45" East, a distance of 1126.18 feet to a point in the centerline of Jefferson Street; Thence South 00°05'20" East, a distance of 653.03 feet; Thence South 89654'40" West, a distance of 80.00 feet; Thence South 00°05'20" East, a distance of 297.71 feet; Thence South 45 ° 19' 11 " West, a distance of 32.76 feet; Thence North 89' 16' 18" West, a distance of 179.36 feet; Thence North 89°44'57" West, a distance of 46.93 feet to the point of beginning. Contains 13.3709 Acres CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 87 STATE OF CALIFORNIA ) )ss. COUNTY OF ) On , 19_, before me, , a Notary Public, personally appeared , personally known to me or 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. WITNESS my hand and official seal. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 88 551G1 ATTACHMENT NO.8 DECLARATION OF CONDITIONS, COVENANTS AND RESTRICTIONS FOR PROPERTY RECORDING REQUESTED BY AND ) WHEN RECORDED MAIL TO: ) La Quinta Redevelopment Agency ) 78-495 Calle Tampico ) La Quinta, California 92253 ) Attention: Executive Director ) (Space Above for Recorder's Use) This document is exempt from payment of a recording fee pursuant to Government Code Section 6103. THIS DECLARATION OF CONDITIONS, COVENANTS, AND RESTRICTIONS FOR PROPERTY (the "Declaration") is made by and between CATELLUS RESIDENTIAL GROUP, INC. (the "Buyer" or "Covenantor") and the LA QUINTA REDEVELOPMENT AGENCY, a public body, corporate and politic (the "Agency" or "Covenantee") as of the _ day of , 1998. RRCITAI.S A. The Buyer is fee owner of record or has entered into an agreement for the purchase of that certain real property (the "Property") located in the City of La Quinta, County of Riverside, State of California legally described in the attached Exhibit "A". The developer shall construct single family homes or apartment units to be sold to buyers that have an income not in excess of 120 % of area wide medium income or rented to tenants that qualify as low or very low income families or individuals. B. The Property is within the La Quinta Project Area (the "Project") in the City of La Quinta and is subject to the provisions of the `Redevelopment Plan" for the Project. C. The Community Redevelopment Law (California Health and Safety Code 33000 gt Seq.) provides that a redevelopment agency shall establish covenants running with the land in furtherance of redevelopment plans. NOW, THEREFORE, THE AGENCY AND THE BUYER AGREE AS FOLLOWS: CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 89 55161 Affordable Housing. The Property is to be used for construction of housing for a household paying not more than "Affordable Housing Cost" for the Property, and having an income not greater than one hundred twenty percent (120%) of area -wide median income or for construction of apartments to be rented to low or very low income tenants. The Property has been made available, in part, with financial assistance provided by the Agency. In consideration of its participation, the Agency requires that the dwelling units or apartments on the Property be maintained as an affordable housing resource until thirty (30) years from the date this Declaration is recorded. If apartments are constructed, the affordability requirements shall remain in place for forty (40) years from the date this Declaration is recorded. The terms and conditions relating to such use and occupancy are set forth in the Affordability Restrictions. The Affordability Restrictions and this Declaration shall be construed as consistent and not in conflict to the greatest extent feasible, in the event of conflict involving the Agency and the Buyer, the Affordability Restrictions shall control. 2. Affordability Covenants. Covenantor agrees for itself, and its successors and assigns; and every successor to Covenantor's interest in the Property, or any part thereof that until thirty (30) years from the date this Declaration is recorded for single family houses of forty (40) years for apartments (the "Expiration Date"): (a) In the event single family houses are constructed, the Property shall only be owned and occupied by Covenantors or by households which, as of the time of purchase of the Property, have an income which does not exceed one hundred twenty percent (120%) of the Riverside County monthly median income (which households shall, for purposes of this Declaration, constitute "Qualifying Income Households"). (b) In the event single family houses are constructed, the Property may be sold at an Affordable Housing Cost (as defined below) to Qualifying Income Households. Affordable Housing Cost shall mean, as to each Qualifying Income Household, that purchase price which would result in monthly housing payments which do not exceed an amount under any currently prevailing conventional home mortgage lending rates applied by any reputable institutional home. mortgage lender, or the lending rates of any government -subsidized or special mortgage program for which such person or family qualifies and has obtained a first trust deed loan, which do not exceed: (i) thirty percent (30%) of fifty percent (50%) or the Riverside County monthly median income (as determined by the United States Department of Housing and Urban Development (the "Median Income") for a household having an income which does not exceed fifty percent (50 %) of the Median Income; with respect to households having an income which does not exceed eighty percent (80 %) of the Median Income, thirty percent (30 %) of seventy percent (70 %) of the Median Income or with respect to households having an income which does not exceed one hundred twenty percent (120%) of the Median Income, thirty five percent (35%) of one hundred ten percent (110 %) of the Median Income, all as more particularly set forth in Section 50052 of the California Health and Safety Code. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 90 55161 (c) In the event apartments are constructed, they shall be rented at Affordable Rental Costs which shall mean that rent which shall not exceed the percentage of the gross income of the occupant person or household established by regulations of the department which shall not be less than fifteen percent (15%) of gross income nor exceed thirty percent (30%0 of gross income, adjusted for family size and a utility allowance to Low Income Households and Very Low Income Households defined as follows: (1) "Low Income Household" shall mean a household earning not greater than eighty percent (80 %) of Riverside County median income, as determined by the United States Department of Housing and Urban Development from time to time, as set forth in Health and Safety Code Section 50105. (2) "Very Low Income Household" shall mean a household earning not greater than fifty percent (50%) of Riverside County median income, as determined by the United States Department of Housing and Urban Development from time to time, as set forth in Health and Safety Code Section 50105. (d) The covenant contained in this Section 1 shall run with the land and shall automatically terminate and be of no further force or effect upon the Expiration Date. (e) This Declaration shall be deemed to be subordinate to the Affordability Restrictions; in the event of conflict, the Affordability Restrictions shall prevail. The Agency will, upon receipt of written request therefore, prepare additional documentation further evidencing such subordination. Notwithstanding the foregoing, this Declaration shall be subordinate to the lien of a first deed of trust against the Property, and shall not impair the rights of any institution or lender which is the maker of a loan secured by such first deed of trust, or such lender's assignee or successor in interest, to exercise its remedies under the deed of trust in the event of default under the first deed of trust by the Covenantor. Such remedies under the first deed of trust include the right of foreclosure or acceptance of a deed or assignment in lieu of foreclosure. After such foreclosure or acceptance of a deed in lieu of foreclosure, the affordability covenants and the transfer restrictions set forth in Sections 1, 2, 3 and 7 of this Declaration shall be forever terminated and shall have no further effect as to the Property or any transferee thereafter; provided, however, if the holder of such deed of trust acquired title to the Property pursuant to a deed or ---assignment in lieu of foreclosure, said Sections 1, 2 3 and 7 of this Declaration shall automatically terminate upon such acquisition of title, provided that (i) the Agency has been given written notice of a default under such first deed of trust; and (ii) the Agency shall not have cured the default under such first deed of trust within the thirty (30) day period provided in such notice sent to the Agency. Notwithstanding any other provision hereof, the nondiscrimination covenants and the maintenance requirements set forth in this Declaration shall remain in full force and effect as to the Property and any transferee. In the event single family homes are constructed, no transfer of the Property shall occur until the Agency determines (a) that the proposed purchaser intends to occupy the Property as the proposed purchaser's principal residence; (b) that the proposed purchaser is a Qualifying Income Household; and (c) that the proposed transfer occurs at an "Affordable Housing Cost" as CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 91 55161 determined pursuant to the Affordability Restrictions. The Agency shall not be obligated to approve a transfer until and unless the proposed purchaser has submitted to the Agency such information and completed such forms as the Agency shall request to certify the proposed purchaser's intent with respect to its residency of the Property and its gross income, and the proposed purchaser has submitted an affidavit disclosing and certifying the amount of the proposed purchase price. Prior to conveyance of the Property, each approved purchaser shall submit to the Agency an executed disclosure statement which certifies that the purchaser is aware that the purchaser buying may only sell the unit at an Affordable Housing Cost to a very low, low, to moderate income person or family, that the maximum permitted sales price may be less than fair market value, and that the units must be owner -occupied at all times and cannot be rented or leased. Covenantor shall cooperate with the Agency in providing such forms to proposed purchasers and in assisting proposed purchaser to prepare such forms and to provide any required information to the Agency in connection with the Covenantor's original sale of the Property, provided that the Covenantor shall not be obligated to incur any out-of-pocket costs in connection therewith, other than employee time dedicated to providing such assistance. COVENANTOR UNDERSTANDS THAT THE DETERMINATION OF THE AFFORDABLE HOUSING COST CAN BE MADE ONLY AT THE TIME OF THE PROPOSED TRANSFER, TAKING INTO CONSIDERATION INTEREST RATES, THE TERMS OF SALE OFFERED TO AND THE ECONOMIC CIRCUMSTANCES OF THE PROPOSED PURCHASER AND OTHER FACTORS THAT CANNOT BE ACCURATELY PREDICTED, AND THAT THE TRANSFER PRICE PERMITTED HEREUNDER MAY BE LESS THAN THE FAIR MARKET VALUE OF THE PROPERTY AND MAY NOT INCREASE OR DECREASE IN THE SAME MANNER AS OTHER SIMILAR REAL PROPERTY WHICH IS NOT ENCUMBERED BY THIS RESTRICTION. COVENANTOR FURTHER ACKNOWLEDGES THAT AT ALL TIMES IN SETTING THE TRANSFER PRICE THE PRIMARY OBJECTIVE OF THE AGENCY AND THIS DECLARATION IS TO PROVIDE HOUSING TO LOWER INCOME HOUSEHOLDS AT AN AFFORDABLE HOUSING COST. In the event apartment units are constructed, the Agency shall approve subsequent transferees and may require assurances that said transferees shall abide by these Covenants, Conditions, and Restrictions. contained- -in—this--Section--2-_shall- run--with--the--land and -shall automatically terminate and be of no further force or effect upon the Expiration Date. 4. Nondiscrimination Covenants. Covenantor by and for itself, its successors and assigns, and all persons claiming under or through them that there shall be no discrimination against or segregation of any person or group of persons on account of race, color, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the Property, nor shall Covenantor itself, or any person claiming under or through it, 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, sublessees, or vendees in the Property. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 92 55161 Covenantor and its successors and assigns, shall refrain from restricting the rental or lease (if permitted by Covenantee) or sale of the Property on the basis of race, color, religion, sex, marital status, national origin or ancestry of any person. All such deeds, leases, or contracts shall contain or be subject to substantially the following nondiscrimination or nonsegregation clauses: (a) In deeds: "The grantee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the grantee himself or herself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the land herein conveyed. The foregoing covenants shall run with the land." (b) In leases: "The lessee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through him or her, and this lease is made and accepted upon and subject to the following conditions: "There shall be no discrimination against or segregation of any person or group of persons on account of race, color, religion, sex, marital status, ancestry or national origin in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the premises herein leased nor shall the lessee himself or herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, sublessees, subtenants or vendees in the premises herein leased." (c) In contracts: "There shall be no discrimination against or segregation of, any person, or group of persons on account of race, color, religion, sex, marital status, ancestry or national origin in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the premises, nor shall the transferee himself of herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with --reference to -the-selection, location; number, use -or occupancy- of tenants,- lessees, sublessees or vendees of the premises." Nothing in this Section 4 shall be construed to authorize the rental or lease of the Property if such rental or lease is not otherwise permitted. The covenants in this paragraph 4 shall run with the land in perpetuity. Covenantor shall properly maintain the buildings, landscaping and yard areas on the Property as follows: (a) No improperly maintained landscaping shall be visible from public rights -of -way, including: CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 93 1. no lawns with grasses in excess of six (6) inches in height; 2 no untrimmed hedges; 3. no trees, shrubbery, lawns, and other plant life dying from lack of water or other necessary maintenance; 4. no trees and shrubbery grown uncontrolled without proper pruning; 5. no vegetation so overgrown as to be likely to harbor rats or vermin; and 6. no dead, decayed, or diseased trees, weeds, and other vegetation. (b) No yard areas shall be left unmaintained, including: 1. no broken or discarded furniture, appliances, and other household equipment stored in yard areas for periods exceeding one (1) week; 2. no packing boxes, lumber, trash, dirt, and other debris stored in yards for periods exceeding one (1) week in areas visible from public property or neighboring properties; 3. no unscreened trash cans, bins, or containers stored for unreasonable periods in areas visible from public property or neighboring properties; and 4. no vehicles parked or stored in areas other than approved parking areas. (c) No buildings may be left in an unmaintained condition, including: 1. no violations of state law, Uniform Codes, or City ordinances; 2. no condition that constitutes an unsightly appearance that detracts from the aesthetics or property value of the subject property or constitutes a private 3. no broken windows or chipped, cracked, or peeling paint; and 4. no conditions constituting hazards and/or inviting trespassers or malicious mischief. 6. Notification as to Capital Improvements. In the event the Covenantor makes capital improvements. to the Property, such capital improvements may affect the amount payable to the Covenantor (or its successors). to the Agency pursuant to the "Buyer Disclosure". In order for the capital improvements to be countable for such purposes, the Covenantor shall, prior to undertaking such improvements, inform the Agency in writing as to the general character, extent, and estimated costs of the improvements, and shall CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 94 55161 further provide invoices, paid bills, and other evidence to substantiate to the reasonable satisfaction of the Executive Director of the Agency the costs incurred. Notice shall reference this Section 6, and shall be mailed or delivered to the La Quinta Redevelopment Agency, Attention: Executive Director, as more fully set forth in Section 10 hereof. 7. Covenants do not Impair Lien. No violation or breach of the covenants, conditions, restrictions, provisions, or limitations contained in this Declaration shall defeat or render invalid or in any way impair the lien or charge of any mortgage or deed of trust or security interest. 8. Conflict with Other Laws: Severability. In the event that any provision of this Declaration is found to be contrary to applicable law or the Affordability Restrictions, then the contrary provisions of this Declaration shall be deemed to mean those provisions which are enforceable and consistent with such laws and policies. The remaining portions of this Declaration shall be deemed modified in a manner which is consistent with the goals and intent of this Declaration to provide housing at an affordable housing cost to very low, low, and moderate income households. Every provision of this Declaration is intended to be severable. In the event any term or provision of this Declaration is declared by a court of competent jurisdiction to be unlawful, invalid or unenforceable for any reason, such determination shall not affect the balance of the terms and provisions of this Declaration, which terms and provisions shall remain binding and enforceable. 9. Covenants for Benefit of City and Agency. All covenants without regard to technical classification or designation shall be binding for the benefit of the Covenantee and the City of La Quinta (the "City") and such covenants shall run in favor of the Covenantee and the City for the entire period during which such covenants shall be in force and effect, without regard to whether the Covenantee or the City is or remains an owner of any land or interest therein to which such covenants relate. The Covenantee and the City, in the event of any breach of any such covenants, shall have the right to exercise all the rights and - --rexnedies-and to 4naintain -any- actions -at -law- or- suits -in-equity -or -other- proper legal- proceedings to ----_--- enforce and to cure such breach to which it or any other beneficiaries of these covenants may be entitled during the term specified for such covenants, except the covenants against discrimination which may be enforced at law or in equity at any time in perpetuity. 10. Notices. Demands and Communications Written notices, demands and communications between the Covenantor and the Covenantee shall be sufficiently given if delivered by hand or dispatched by registered or certified mail, postage prepaid, return receipt requested, as follows: CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 95 551G1 Covenantor: Catellus Residential Group 5 Park Plaza, Suite 400 Irvine, California 92614 Attn: John O'Brien Covenantee: La Quinta Redevelopment Agency Attention: Executive Director 78-495 Calle Tampico La Quinta, California 92253 Such addresses for notice may be changed from time to time upon notice to the other party. Any written notice, demand or communication shall be deemed received immediately if delivered by hand and shall be deemed received on the fifth (5th) calendar day from the date it is postmarked if delivered by registered or certified mail. 11. Expiration Date. This Declaration shall automatically terminate and be of no further force or effect as of thirty (30) years from the date this Declaration is recorded in the event single family homes- are constructed and forty (40) years from the recorded date in the event apartment units are constructed. IN WITNESS WHEREOF, the Covenantee and Covenantor have caused this instrument to be executed on their behalf of their respective officers hereunto duly authorized as of the date set forth above. THE LA QUINTA REDEVELOPMENT AGENCY, a public body, corporate and politic By: ------- --------- ----- -- THOMAS P. GENOVESE, Executive Director "COVENANTEE" Attest: SAUNDRA L. JUHOLA, Agency Secretary (Agency's and Owner's Signature must be acknowledged*by a Notary Public) CATELLUS RESIDENTIAL GROUP, INC. "COVENANTOR" or DEVELOPER" CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 96 551Vj EXHIBIT A LEGAL DESCRIPTION OF SA PROPERTY All that portion of the Southeast quarter of Section 29, Township 5 South, Range 7 East, San Bernardino Meridian, in the City of La Quinta, County of Riverside, State of California, described as follows: Commencing at the southeast corner of said Section 29; Thence North 89' 1618" West, a distance of 330.44 feet along the South line of said Section 29, also being the centerline of Avenue 48; Thence North 00°43'42" East, a distance of 56.61 feet to a point in the North line of said Avenue 48, said point being the point of beginning. Thence North 00°43'42" East, a distance of 125.39 feet; Thence North 89*16'18" West, a distance of 52.00 feet; Thence North 00°43'42' East, a distance of 487.00 feet; Thence North 89° 16' 18" West a distance of 523.12 feet to the beginning of a tangent curve, concave southerly and having a radius of 220.00 feet; Thence westerly along said curve through a central angle of 20'18'37", an arc distance of 77.99 feet to a point in a non -tangent line; Thence north 19°34'55" West, a distance of 100.54 feet; Thence North 45°12'34" West, a distance of 141.00 feet; Thence North 43058'19" West, a distance of 27.01 feet to the beginning of a non -tangent curve concave southeasterly and having a radius of 61 feet, a radial through said point bears north 45°12'34" west; Thence northeasterly along said curve through a central angle of 38°48'45", an arc distance of 41.32 feet to a point in a non -tangent line; Thence North 05'05'11" West, a distance of 70.35 feet; Thence North 45°12'34" West, a distance of 71.72 feet to a point in the East line of the Coachella Valley Water District La Quinta Evacuation Channel; Thence North 44°47'26" East, a distance of 26.82 feet; Thence South 89°40'45" East, a distance of 1126.18 feet to a point in the centerline of Jefferson - - -- --- Street; _ Thence South 00°05'20" East, a distance of 653.03 feet; Thence South 89°54'40" West, a distance of 80.00 feet; Thence South 00005'20" East, a distance of 297.71 feet; Thence South 45'19'11" West, a distance of 32.76 feet; Thence North 89'1618" West, a distance of 179.36 feet; Thence North 89°44'57" West, a distance of 46.93 feet to.the point of beginning. Contains 13.3709 Acres CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 97 55161 ATTACHMENT NO.9 CERTIFICATE OF COMPLETION RECORDING REQUESTED BY ) AND WHEN RECORDED MAIL TO: ) LA QUINTA REDEVELOPMENT AGENCY 78-495 Calle Tampico ) La Quinta, California 92253 ) Attn: Executive Director ) Space above for Recorder's use. CERTIFICATE OF COMPLETION OF CONSTRUCTION AND DEVELOPMENT WHEREAS, by an Affordable Housing Agreement dated , 19_5 by and between the LA QUINTA REDEVELOPMENT AGENCY, a public body, corporate and politic (hereinafter referred to as the "Agency") and (collectively referred to as the "Developer"), the Developer has constructed improvements upon the real property (the "Site"), legally described on the Attached Exhibit "A", by constructing or causing to be constructed the improvements thereon according to the terms and conditions of said Affordable Housing Agreement (the "Agreement"); and WHEREAS, pursuant to Section 315 of the Agreement, promptly after completion of the Improvements the Agency shall furnish the Developer with a Certificate of Completion upon written request therefor by the Developer; and WHEREAS, the issuance by the Agency of the Certificate of Completion shall be conclusive evidence that the construction of the Improvements conforms to the Agreement; and WHEREAS, the Developer has requested that the Agency furnish the Developer with the Certificate of Completion; and WHEREAS, the Agency has conclusively determined that the construction of the Improvements conforms to the Agreement; NOW, THEREFORE: 1. 1. As provided in the Agreement, the Agency does hereby certify that the construction of the Improvements required to be constructed on the Site described in Exhibit "A" hereto has been satisfactorily performed and completed and that such development and construction work complies with the Agreement. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 98 55161 2. This Certificate of Completion does not constitute evidence of compliance with or satisfaction of any obligation of the Developer to any holder of a mortgage or any insurer of a mortgage security money loaned to finance the work of construction if improvements and development of the Site, or any part hereof. This Certificate of Completion is not a notice of completion as referred to in Section 3093 of the California Civil Code. 3. This Certificate of Completion does not denote completion of any work required to be completed, other than on the Site. . 4. The Deed of Trust recorded as Document No. among the official land records of the County of Riverside and those Conditions, Covenants and Restrictions recorded as Document No. among the official land records of the County of Riverside shall remain in full force and effect. IN WITNESS WHEREOF, the Agency has executed this Certificate as of this day of , 19_. LA QUINTA REDEVELOPMENT AGENCY THOMAS P. GENOVESE, Executive Director ATTEST: SAUNDRA L. JUHOLA, Agency Secretary CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 99 55161 ATTACHMENT NO. 10 APPLICATION FOR DISBURSEMENT TO: La Quinta Redevelopment Agency ("Agency") REQUEST NO. DATE: , 19_ "DEVELOPER": PROJECT: LOCATION: Pursuant to Affordable Housing Agreement dated as of October ^,1998 (the "Agreement") between Developer and Agency, Developer hereby requests that Agency to advance $ of the Agency Assistance. This advance is requested to pay for various expenses incurred in connection with the above Project, development of the land or construction of the improvements as summarized on the schedule attached hereto and detailed in the invoices submitted herewith. Developer hereby certifies that the amounts shown on the attached schedule and the accompanying invoices represent costs of designing, developing, and constructing improvements for the Project which are eligible for reimbursement at this time in accordance with the provisions of the Agreement. Developer acknowledges that any increased costs of construction arising out of change orders, or otherwise, are not included in, or provided for, in the Budget and cannot be invoiced on this Application for Disbursement unless and until such change orders and/or increases in costs have been approved in writing by the Agency, except as otherwise provided in the Agreement. Developer certifies that there have been no change order or changes in the work of the Improvements, except as previously expressly approved by Agency in writing, or as referenced below, with a copy of the appropriate documentation describing the change attached hereto (whether or not a disbursement is requested herein on account of such change). The following change orders, identified by number and date have been proposed and/or approved since the last Application: SUBMITTED BY: Date: .19 CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 100 REVIEWED AND APPROVED BY: - Agency Inspector Date: DISBURSEMENT SCHEDULE Budgeted Item of Cost Amount Amount Previously Disbursed 19 Amount Requested this Disbursement 5S161 CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 101 55161 ATTACHMENT 11 PROJECT BUDGET - SA DEVELOPMENT 1. Budget for the 118 units of the SA Development is derived from a budget prepared by Developer dated May 28, 1998. A full and complete copy of the May 28, 1998 budget is on file with the Executive Director of the Agency (La Quinta Redevelopment Agency). Changes from said May 28t' budget to the Project Budget include changing the Developer Fees to those referenced in this budget and deducting $250,000 from the SA budget for bonds and fees due to costs which were budgeted for Street Assessments associated with the improvement of Avenue 48. Since these improvements to Avenue 48 have been completed by the Agency and are included in the purchase price as set out in Section 201 paragraph 2 of the Agreement, there is no need to carry them in the budget. 2. References within said May 28, 1998 budget to Infrastructure costs not fully detailed in said May 28' budget shall refer to an Infrastructure Budget dated June 1, 1998 also on file with the Agency Executive Director. 3. It is anticipated that should funding not be forthcoming for a Senior Apartment (SA) project to be developed in accordance with this Affordable Housing Agreement that the SA project will be terminated and additional housing will be developed under the SFR Agreement in accordance with this agreement. Said additional housing may be developed as additional phases of housing and is referred to in the SFR Agreement as the "Fourth Phase" of the project. A budget is included herein and an identical budget included in the SFR Agreement for said Fourth Phase. The basis for said Fourth Phase budget is a detailed budget dated August 13, 1998 which is on file with the Agency Executive Director. The only changes from said August 13,1998 budget to the Fourth Phase project budget is that $250,000 has been deducted from Bonds and Fees to account for the prorata share of Avenue 48 improvements which as previously discussed are included as a cost in the purchase price. 4. Cash flow projections are included in this attachment. The intent of said projections is to give a general idea of the expected timing of the costs associated with the development of the project. Actual cost timing may vary from these projections. Insofar as Agency and Developer wish to assure that there are sufficient funds available to fund costs to be incurred later in the project Developer may shift funds from a budget category with a surplus to fund budget categories with a deficit only upon approval of the Agency Executive Director. The contingency account may fund deficits occurring at any point in the schedule, the contingency account is not subject to the requirement that the work be completed and paid for before funds can be shifted from it. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 102 55, 61 5. Developer has provided a list of plans and specifications which is attached to this Attachment 11. Developer represents that the Project Budget was developed based upon the plans and specifications listed and that said list is full and complete. Any substantial changes in project costs due to significant changes to the project design from that detailed in the plans in the attached list will not be subject to the Developer guarantee of costs. Developer represents that there have been no changes to the plans and specifications from the date of said plans and specifications referenced in the attached list to the date this Affordable Housing Agreement is signed which results in any increases or decreases in prices which would void the Developer Guarantee. 6. Developer will be commencing construction of the SA Development before Tax Credits required for its funding have been awarded. If Tax Credits are not awarded additional SFR housing will be developed in accordance with the Fourth Phase budget and the SFR Agreement. Before the award of Tax Credits, Developer will only construct "Base Infrastructure", which for the purposes of this Agreement is defined as that infrastructure construction which will be able to serve either the SA Development or the Fourth Phase SFR Development. CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 103 Project Budget Senior Apartments (SA) (118 units) Sources of Funds (excluding_ Agency Assistance,) Costs Proceeds from Sale of Tax Credits $ 7,606,098 Permanent (takeout) Loan 917,505 Income during leaseup 57,758 $ 8,581,361 Land 0 Bonds & Fees 1,016,862 Offsite Improvements 1,334,524 Common Areas 957,553 Engineering 155,017 Onsite (directs) 3,574,320 Lot Improvements 103,750 Construction indirects 283,056 Project Development 386,410 Construction Finance/Takeout 1,152,326 Property Taxes 6,630 Sales Complex 50,500 Sales & Marketing 120,050 Contingency 281,733 Project costs before Catellus fees $ 9,4229731 Developer Fees Overhead: $ 540,376 Profit: 594,414 Total Developer Fees, SFR $ 1,134,790 Total Costs $10,557,521 551fb1 All budget numbers are guaranteed not to exceed estimates by Developer based upon May 28, 1998, project references and assumptions detailed in the list of plans and specifications attached hereto for the Village on The Green. Any cost reductions or revenue improvements are to be applied to reduce the subsidy provided by the Agency subject to sharing with Developer per the cost savings agreement percentages set forth in Section 201(5). CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 104 5sisa Project Budget Single Family Residential (SFR) Fourth (4"Phase Budget (45 units) Revenue• 45 units at weighted average of $148,643/unit ($75.95/sq.ft.) $ 6,688,946 Costs Land 0 Bonds & Fees 763,067 Offsite Improvements 971,982 Common Areas 351J95 Engineering 114,875 Onsite (directs) 3,478,686 Lot Improvements 286,400 Construction indirects 315,370 Project Development 199,255 Construction Finance/Takeout 261,200 Property Taxes 11,838 Sales Complex 7,500 Sales & Marketing 583,713 Contingency 227,852 Project Base Costs $ 7,572,933 Developer Fees Overhead: $ 333,567 Profit: 3669241 Total Developer Fees, SFR $ 699,808 Total Costs $ 8,272,741 All budget numbers are guaranteed not to exceed estimates by Developer based upon May 28, 1998, project references and assumptions detailed in the attached list of plans and specifications for the Village on The Green. Any cost reductions or revenue improvements are to be applied to reduce the subsidy provided by the Agency subject to sharing with Developer per the cost savings agreement percentages set forth in Section 201(5). CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 105 55161 COST SAVINGS MATH SFD Cost Savings Math: Total AHA Budget, SFR & SA incl SFR profit $28,010,007 SFR budget including profit 17,452,486 SFR portion of total project budget 62.31% lst tranche cost savings sharing $250 000 allocated to SFR @ 62.31 % $155 775 Developer share @ 75% $116,831 SA Cost Savings Math: Total AHA Budget, SFR & SA incl profit $28,010,007 SA budget including profit $10,557, 521 SA portion of total project budget 37.69% lst tranche cost savings sharing $250,000 allocated to SFR @ 37.69% $94,225 Developer share @ 75% $70,669 CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 106 N C O 'v 4) O � L � a d o m t=A Q c� VI UAA O O O n a, N 00 ON o vi O O rn O N N � 00 en os� O, CN N N in N O O 0�0 O O O ON 0000 O O 00 O O O N .fir 00 py N N O O co O O O O ON 00 O\ �+ O DD N ^ H a7i O N N N o0 00 0�0 O O O C. 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O 0 O 0 O 0 O 0 O 0 O 0 O 0 O 0 N O O o O Y Ow O 00 O O O N N N M M V vi h�� b n o0 Qp > J A � is161 CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 107 o O = N eo z N e z N Ch O\ C z O, a ON � v 5S161 C No- CDoMo en o n Clt � o o m I O N � N N N M N O n v� O\ M NO MO cp O� N O OO O -� O N C l- N N t O N N N r- kn 00 V n O v1 O O O O t- O l- N 0 O 0 O 0 M �n 00 R %O vi O O h N �O O o0 O O o0 o0 V N N Obi n + N N O N N V V1 00 O O O O O M %D O O O O O O r- O �D O 0 O 0 N �o eY I� p 00 O O O O O [^ O\ �D �O N [met �p '-i M vl 00 N v1 C\ O N N 7 N r O N M M �o (n O O O O O O O O O O O O O 0o [� O O l� N O O Yn 00 M O O O O o0 �D O O 00 O O V O %O n V 0 h M C �p vi N n O N N 7 O O O O O O O O O O O O O O O O D\ en O O O O r- N O O O Vn m O. O\ c" N 'n p O O O O O O \O O O 00 I O N cl n n v1 O N N vi N N'1 N r- CD N 00 O� h N `G D ri O o r. n v1 ON 0 o 0 0 O 0 O 0 O 0 O 0 O o �o r� N O M M n p A �n O O N O O O %O O O 0O 00 en�n �p y a0 O M vpi tr� N Cl rn 00 M vl �p O N n a h a en C N p 7 O O O O O �O O O l� O O O O O O O �O I� ^• N O CD O\ M O O O O l- O %D O O OO n W n N M M O O M O en 00 Q U M� N a M o O o O a P o O C. O oIn O O O O P N v1 N o0 00 In O O O o0 OO I 00 M O N vi O M vi N .O 7 M N 7 N �o 00 00 %D N U O O O O O O N C C4, N a\ Q LC 'n O O O A 0 0 N N o N O �] C O DD T O� Y O v n �. o x o o 00 r- O 0 00 �D C.00 In ti _ a a A C-4 N w o y y PQ o � y •� � � q :a � .4 •• F ayi w C� � °� o � o A `� `� 0 ElS o a' .A h F a E d d O o UO p W H Oy N O OF W O O U p w O a O U a A A i7. a co S,"y U U CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 108 d E V O O O D\ O � O N V'1 V'1 O_ r- [� �-. N O M O O O V1 m M N M %O O� O V1 %C N N Ow t- V1 O M l�, O 7 n M� v� O rl v1 O1 y o 00 N 00 M D\ O� f'�i 00 �D m l� O N o0 t- Vl In v1 C l� M O m w %O w O T�-i N �O O vn O N •--� W l� In N N N U m N m h Yn N M O O O O N 00 0 U o a M m N O O O O O N O O -�T O of C. N .cc}} M m oo m N� OMO„ r N Ob In T O M � N 7 O Um m O O O O O O O O "' q C.O O O tL C O .-. W M O O O O N N O O %O a0 00 V1 r- t� 00 O N V No � o o y � "a n b M M G O C. h O� O O t, O N M O O\ V (V ON M O O oo N �O O O �O 00 O M vi N r m O� ^" O R w �O N O Y O N b r � L UCd 2 zz dT O O t` O\ O r- N O a0 h O Y O O �O N �O O oo O 7 00 00 N N O v U O d ^ D\ �- ^v CD L. O N O W) O N M O N N 7 O_ CJ oc 78 4) a�i ° O oc JS 0--��a��3Ha.0 a o ° r� a' ° 4 o A 2 ass u ..� O U w .°a U a A Ca i 40 v�1 ul 1 2 U CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 109 0 0 0 r 00oN O O 0 0 0 N a N l� n M On N N 00 O O 00 O O O O N N 00 N ON n n O oo 7 t- 7 O O O O O O N n C7, O m IrL [� IL M R 00 7 N� 00 O 0 0 CD0000 p 0 0 N 0000 0000 ON N cs C V 00CD C, C)O O n O n C. O N O CPA O O l% M M M N N O 00cn O O CIO C)O eq N C. cq C) O N h 0 �n ti W O O M 0 0 n O 0 7 0 N N r O l% O n r ll:� M M N N R � M N ^. r- O O O DD v N %n O O M 00 �D C)^� O C' 00 Q� to rl 'ITN rl �O as W O N O n O� 7 N M 00 vi O eT O O O v1 7 O O� �O 0 ti z Ntn O W) N N O N M O � � O O O In m O 0000 OMO �/1 00 00 et a T •-+ O � --� V 7 000 000 N M a ++ N O O I thn bD N .b vi vM'i A tJ d ^O � � T W w y N O N (! A U w U w p A Ca C7 e 'a co O d d U 2� a O W O p O 0U a A U E U ssul CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 110 O Z N O Z N 4 a,r- O% J z O\ t. ON O\ C, ON 0 00 0 0 0� M N O M N N [� rn �+ rn Vi t•1 � a O D O O 00 .M.. M 000 O mo O O 'D M p N N �n N N a O V 0 v1 O O r- .M-i h O 0000 N M \D a\ en N O, U n N 7 10 ono N v�i 1 7 N Cl 00 o0 tn1 O O - O - - h 0 Vq O N o0 N \O v 10 rn m 00 o rn N D D O C's M O 00. O � �O M T O• N O O O v1 M 00 W- %o 0% N 0 O 00 O en vn r- O M 00 M 0 0 o rn �o moo oa N 00 w O M en 0 0 0 0 n 7 V ID O N M O M rn M vl n cn t- n v O N ..-i cn O IDI O 10� N_ O O O O O O C ry V1 V [l- [n D �o � 00 0 N 0 0 lD O O t� et N O O O� O r- O O n OOO 7 0 O v1 kn O O M [- en OO 00 O O O O O O N 000 7 O 000 O w C. -� oo DD O 00 en..i 00 V1 V1 n Co n 00 W 5 N d % yy Q V b a A A �7cy H p C7 o V Z .a O W con w a• F ., z O O O q 0 W 00 � a a O z N U C4 Q F• I U 1 U U w aW A FO 551GJ CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 111 Q O N O M -•+ O N V O O 00 O NO OItr M O M 00 M � V l� v, r- a �, O O O0% N 7 O N �O \O 00ON 00 n 00 00 M N M V Cl C 'I vt n O 7 N V O O O DD O O V o0 00 Vn CD 'n ONO �p N O Co N n O M O M O 00 00 O Mcp M 000 g C. N OOo- "t b n- r, to T O `-� rn N oc� N V n M O N O -••� 0000 C, 'n M N E O M et O IC �O R V 00 00 00 n O O O O O M_ •-� M O N N 0\ N O N � y v5 U w U w O U O p H A WW O H W a O c� o� oo H pF z W a H Fl d H U U E- U U Q 55161 CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 112 Cost Sharing Financial Examples Example l: Project comes in on budget Total revenue Total expenses before Developer Fees Developer fees: -OH Developer Fees - Profit Total Developer fee Total costs including Developer Fee Total costs savings Total revenue over budget total improvement Developer Share Redevelopment Agency share Redevelopment Agency Subsidy: Land Construction/infrastructure Homeowner's Association subsidy Fees, Bonds, Planning Total subsidy before .share of cost savings Total subsidy.including cost savings SFD SA Total 12,725;970 8,581,361 21,307,331 16,116,259 9,422,731 25,538,990 636,299 540,376 1,176,675 699,928 594,414 1,294,342 1,336,227 1,134,790 2,471,017 17,452,486. 10,557,521 28,010,007. 2,900,000 3,505,890 749,849 3,196,786 10,352,525 10,352,525 55161 CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 114 C � V)� rMT �4e4 W� 0 F O O O t�+1 Go le N 00 �O 00 %n F h o vN to v�i r n M r; r; 44 cq cn vi o. 49 fA cs3 rsa 00 .-, kn O t- t- O i/4 %n 00 VN1' %C ., .. N 00 K i9 !A 69 ir9 i9 i 9 C q a as w O N O O O C e+w H V� bD C 00000 4= en Vm1 c cc GA fA iA 49 4R 44 i9 N O � W C u a C% e0o M coo+i � t— M n - O %O ON N u 44 el i9 00 vi a 44 v" vi ri iA in -i9 cc cA %o 0 u c a u w A V� ON vi O O' O O 00 v1 O O M o0 be eci i 4 4A K 4 O a� cn � +r u G sC w O Q. ►�. C 00 G U in0cn 4 > .0 < .. 0 < u OU C3 x 12 55162 CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 113 Example 2: Project expenses come in S% over budget Total revenue Total expenses before Developer Fees Budget variance Amount between $0 & $250,000 Developer share at 100% Agency Share at 0% Amount over $250,000 Developer share at 100% Agency Share at 0% Unadjusted costs including Developer Fee Unadjusted Developer fees: -OH Unadjusted Developer Fees - Profit Adjustment to Developer Fee -.OH Adjustment to Developer Fee - Profit Adjusted Developer Fee Total costs including -Developer Fee Total cost reductions Total revenue over budget Project Variance Developer Share Redevelopment Agency share Redevelopment Agency Subsidy: Land Construction/infrastructure Homeowner's Association subsidy Fees, Bonds, Planning. Total subsidy before share of Variance Agency Share of Project Variance Total subsidy including share of Variance SFD SA Total 12,725,970 8,581,361 21,307,331 16,922,072 9,893,868 26,815,940 805,813 471,137 1,276,950 155,775 94,225 250,000 155,775 94,225 250,000 650,038 376,912 1,026,950 650,038 376,912 1,026,950 18,258,299 11,028,658 29,286,956 636,299 540,376 1,176,675 699,928 594,414 1,294,342 (805,813) (471,137) (1,276,950) 530,414 663,653 1,194,067 17,452,486 10,557,521 28,010,007 (805,813) (471,137) (1,276,950) 805,813 471,137 1,276,950 (805,813) (471,137) (1,276,950) 2,900,000 3,505,890 749,849 3,196,786 10,352,525 10,352,525 5S161 CAMy Documents\WPDOCSNCat-AFA-SenApt.wpd 115 Example 3: Project expenses comes in 5% under budget Total revenue Total expenses before Developer'Fees Budget variance Amount between $0 & $250,000 Developer share at 75% Agency Share at 25% Amount over $250,000. Developer share at 50% Agency Share at 50% Unadjusted costs including Developer Fee Unadjusted Developer fees: -OH Unadjusted Developer Fees - Profit Adjustment to Developer Fee - OH Adjustment to Developer Fee - Profit Adjusted Developer Fee OH & Profit Total costs including Developer Fees Total cost reductions Total revenue over budget Project Variance Developer Share Redevelopment Agency share Redevelopment Agency Subsidy: Land Construction/infrastructure Homeowner's Association subsidy Fees, Bonds, Planning Total subsidy before share of Variance Agency Share of Project Variance Total subsidy including share of Variance SFD 12,725,970 15,310,446 (805,813) (155,775) (116,831) (38,944) (650,038) (325,019) (325,010) 16,646,673 636,299 699,928 441,850 1,778,077 17,088,523 805,813 (805,813) 441,850 (363,963) SA 8,581,361 8,951,594 (471,137) (94,225) (70,669) (23,556) (376,912) (188,456) (188,456) 10,086,384 540,376 594,414 259,125 1,393,915 10,345,509 471,137 (471,137) 259,125 (212,012) Total 21,307,331 24,262,041 (1,276,950) (250,000) (187, 500) (62,500) (1,026,950) (5132475) (513,475) 26,733;057 1,1762675 1,294,342 700,975 3,171,992 27,434,032 1,276,950 (1,276,950) 700,975 (575,975) 2,900,000 3,505,890 749,849 3,196,786 10,352,525 (575,975) 9,776,550 CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 116 Example 4: Project revenue comes in S % over budget SFD SA Total Total revenue 13,362,269 9,010,429 22,372,698 Total expenses before Developer Fees 16,116,259 9,422,731 25,538,990 Budget variance (636,299) (429,068) (1,065,367) Amount between $0 & $250,000 (155,775) (94,225) (250,000) Developer share at 75% (116,831) (7009). (187,500) Agency Share at 25% (38,944) (23,556) (62,500 ) Amount over $250,000 . (480,524) (334,843) (815,367) Developer share at 50% (240,262) (167,422) (407 683) Agency Share at 50% (240,262) (167,422) (407'683) Unadjusted costs including Developer Fee 17,452,486 10,557,521 28,010,007 Unadjusted Developer fees: -OH 636,299 540,376 1,176,675 Unadjusted Developer Fees - Profit 699,928 594,414 1,294,342 Adjustment to Developer Fee - OH - - - Adjustment to Developer Fee - Profit 357,093 238;090 595,183 Adjusted Developer Fee OH & Profit 1,693,320 1,372,880 3,066,200 Total costs including Developer Fees 17,809,579 10,795,611 28,605,190 Total cost reductions _ - Total revenue over budget 636,299 429,068 1,065,367 Project Variance (636,299) (429,068) (1,065,367) Developer Share 357,093 238,090 595,183 Redevelopment Agency share (279,206) (190,978) (470,183) Redevelopment Agency Subsidy: Land 2,900,000 Construction/infrastructure 3,505,890 Homeowner's Association subsidy 749,849 Fees, Bonds, Planning 3,196,786 Total subsidy before share of Variance 10 352, 525 Agency Share of Project Variance (470,183) Total subsidy including share of Variance 9,882,341 CAMy Documents\WPDOCS\Cat-AFA-SenApt.wpd 117 _ ssls1 Example S; Project revenue comes. in S% -under budget SFD SA Total Total revenue 12,089,672 8,152,293 20,241,964 Total. expenses before Developer Fees r, 16,116,259 9,422,731 25,538,990 Budget variance 636,299 429,068 1,065,367 Amount between $0 & $250,000 .155,775 94,225 250,000 Developer share at 100% 155,775 . 94,225 250,000 Agency Share at 0% _ _ _ Amount over $250,000 480,524 334,843 8-15,367 Developer share at 100% 480,524 - 334,843 815,367 Agency Share at 0% - _ _ Unadjusted costs including Developer Fees -17,452,486 10,557,521 28,010,007 Unadjusted Developer fees: -OH 636,299 540,376 1,176;675 Unadjusted Developer Fees - Profit 699,928 594,414 1,294,342 Adjustment to Developer Fee - OH - _ _ Adjustment to Developer Fee - Profit (636,299) (429,068) (1,065,367) Adjusted Developer Fee OH & Profit 699,928 705,722 1,405,650 Total costs including Developer Fees 16,816,187 10,128,453 26,944,640 Total cost reductions Total revenue over budget (636,299) (429,068) (1,065,367). Project Variance 636,299 429,068 1,06.5,367 Developer Share (636,299) (42-9,068) (1,065,367) Redevelopment Agency share Redevelopment Agency Subsidy: Land 2,900,000 Construction/infrastructure 3,5 05,890 Homeowner's Association subsidy. 749,849 Fees, Bonds, Planning 3 196'786' Total subsidy before share of Variance 10, 352525 Agency Share of Project Variance _ Total subsidy including share -of Variance 10,352,525 C:Ny Documents\WPDOCS\Cat-AFA-SenApt.wpd 118 COMMONWEALTH LAND TITLE CO. RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: La Quinta Redevelopment Agency 78-495 Calle Tampico La Quinta, California 92253 Attention: Executive Director OOC = 2005—OG24560 08/03/2005 08:00A Fee:NC Page 1 of 3 Recorded in Official Records County of Riverside Larry W. Ward Assessor, County Clerk 8 Recorder 1111111111111111111111111111111111111111111111111111111 M S U PAGE SIZE OA PCOR NOCOR SMF MISC. A R L COPY I LONG REFUND NCHG EXAM This document is exempt from payment of a recording fee pursuant to Government Code Section 6103. CANCELLATION OF RESALE RESTRICTIONS AND MAINTENANCE AGREEMENT MA YOU ARE HEREBY NOTIFIED THAT THE UNDERSIGNED, La Quinta Redevelopment Agency, the beneficiary of that certain Resale Restrictions and Maintenance Agreement ("Agreement") dated February 23, 2000, executed by RONALD W. YONEKURA AND DEBBIE YONEKURA, husband and wife as joint tenants (the 'Participant") and the LA QUINTA REDEVELOPMENT AGENCY (the "Agency"), which was recorded in the office of the County Recorder of the County of Riverside, State of California on March 3, 2000 as Instrument No. 2000-80027 of Official Records of the County of Riverside, hereby cancels and releases said Agreement. Dated this 22nd day of July, 2005. LA QUINTA REDEVELOPMENT AGENCY By: Thomas P. Genovese Executive Director G:\RSG\LaQuinta\miratlores\Pevott Dcwumenls\S'onekura\cancellation of resale resinctions.DOC ,(17-e776 ,/v �� State County of Riverside) On before me, [_, notary public, personally appeared THOMAS P. ENOVESE personal known to me, or 0 proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/cwt-subscribed to the within instrument and acknowledged to me that he/s4s4# wy executed the same in his/f etr authorized capacity(ies), and that by his/# e44#reir signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. WITNESS my hand and official seal Signature: - "'r, Print Name Commission Expires (SEAL) COMM11pion # M-1423� Notary Public - Cdifomia Riverside County MY Comm, Expires Ck: t 23, ?(M CAPACITY CLAIMED BY SIGNER O INDIVIDUALS O CORPORATE OFFICERS) 0 PARTNERS 0 ATTORNEY -IN -FACT 0 TRUSTEE(S) O SUBSCRIBING WITNESS O GUARDIAN/CONSERVATOR O OTHER: SIGNER IS REPRESENTING: (Nome Of Person(s) Or Entities) GAR SGVLaQunuaAmirafloresVPayoff Document sAYonekmAanceltat uon of resale restrict ions.DOC ILLEGIBLE NOTARY SEAL DECLARATION GOVERNMENT CODE 27361.7 I certify under penalty of perjury that the notary seal on the document to which this statement is attached reads as follows: Name of Notary Regina Hensler Date Commission Expires October 23 2008 / #1521423 County Where Bond is Filed Riverside County Place of Execution of this Declaration San Bernardino CA 92408 Date February 23 2005 — Commonwea and Title C pany COMMONWEALTH LAND TITLE GO. RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: La Quinta Redevelopment Agency 78-495 Calle Tampico La Quinta, California 92253 Attention: Executive Director OOC a moos-osz4ss9 08/03/2005 08:00A Fee:NC Page 1 of 3 Recorded in Official Records County of Riverside Larry W. Ward Assessor, County Clerk & Recorder IIIIIIIIII 1111111111111111111111111111111111111111111111111111 M S U PAGE SIZE DA PCOR NOCOR SMF W. A R L COPY LONG REFUND NCNG EXAM This document is exempt from payment of a recording fee 4w pursuant to Government Code Section 6103. CANCELLATION OF T AGREEMENT TO ENCUMBER ADDITIONAL PROPERTY UNDER MA AFFORDABLE HOUSING AGREEMENT YOU ARE HEREBY NOTIFIED THAT THE UNDERSIGNED, La Quinta Redevelopment Agency, the beneficiary of that certain Agreement to Encumber Additional Property Under Affordable Housing Agreement for Single Family Residential ("Agreement"), executed by Catellus Residential Group, Inc. and the LA QUINTA REDEVELOPMENT AGENCY (the "Agency"), which was recorded in the office of the County Recorder of the County of Riverside, State of California on March 31, 1999 as Instrument No. 134932 of Official Records of the County of Riverside, hereby cancels and releases said Agreement. Dated this 22nd day of July, 2005. LA QUINTA REDEVELOPMENT AGENCY By- Thomas P. Genovese Executive Director G:\RSG\LaQulnta\mira0ures\Pavoff Documents\Yonekura\kancellation of afaIDO( ate of California) Countty/ of Riverside) On '/ a�P"o'��"� before me, notary public, personally appeared THOMAS P ! ENOVESE person Ily known to me, or O proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/ere subscribed to the within instrument and acknowledged to me that he/she hey executed the some in his/het/*m* authorized capacity(ies), and that by his/Iir signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. WITNESS my hand and official seal. Signature: Print NnmP C'nmmission Expires (SEAL) + r. CAPACITY CLAIMtU BY JIGIVtK O INDIVIDUALS O CORPORATE OFFICERS) O PARTNERS D ATTORNEY -IN -FACT O TRUSTEE(S) O SUBSCRIBING WITNESS O GUARDIAN/CONSERVATOR 0 OTHER: SIGNER IS REPRESENTING: (Name Of Person(s) Or Entities) C,:\RSO\LaQuinta\miraflures\Payoff Documents\Yonekura\cancellauun ut ata2DOC ILLEGIBLE NOTARY SEAL DECLARATION GOVERNMENT CODE 27361.7 I certify under penalty of perjury that the notary seal on the document to which this statement is attached reads as follows: Name of Notary Regina Hensley Date Commission Expires October 23 2008 / #1521423 County Where Bond is Filed Riverside County Place of Execution of this Declaration San Bernardino CA 92408 Date.February 23 2005 �� • • • •mp