HomeMy WebLinkAboutAgr 1994-03-29 (Ecumenical Association for Housing)C/,y
EXCLUSIVE NEGOTIATING RIGHTS AND
PREDEVELOPMENT LOAN AGREEMENT
FOR TIBURON HIGHLANDS HOUSING DEVELOPMENT
This Exclusive Negotiating Rights and Predevelopment Loan
Agreement (the "Agreement") is entered into as of March 16, 1994,
by and between the Tiburon Redevelopment Agency, a public body,
corporate and politic (the "Agency"), and Ecumenical Association
for Housing, a California nonprofit public benefit corporation
("EAH"), with reference to the following facts, purposes, and
intentions.
RECITALS
A. By purchase and sale agreement between the Agency and
the Town of Tiburon (the "Town") dated as of March 16, 1994 (the
"Purchase and Sale Agreement"), the Agency has contracted to
purchase that certain unimproved lot containing approximately
2.94 acres located at the end of Cecilia Way in the Town of
Tiburon, California (the "Property"). The legal description of
the Property is set forth in the attached Exhibit A.
B. The Property is one of the last remaining sites in
Tiburon which is suitable for the development of housing
affordable to persons and families of low and moderate income.
C. In connection with execution of the Purchase and Sale
Agreement, the Town, the Agency, and representatives of the
neighborhood adjacent to the Property expressed the intent that
the Property by developed for affordable housing by EAH, which
has worked with the Town, the Agency, and neighborhood
representatives to prepare a design concept for such affordable
housing that is sensitive to and compatible with surrounding
development.
D. Such design concept calls for development of sixteen
(16) units of housing affordable to low and moderate income
elderly persons and families (the "Development"). The design
concept for the Development is attached to this Agreement as
Exhibit B.
E. The Agency and EAH understand and acknowledge that a
rezoning of the Property will be necessary to allow the
envisioned Development. The Town has not approved the necessary
rezoning and must consider any request to rezone the Property
through the Town's regular planning process.
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F. As more fully set forth in Article 1 of this Agreement,
the Agency and EAH desire to enter into a period of exclusive
negotiations toward preparation and execution of a Disposition
and Development Agreement (the "DDA") providing for disposition
of the Property by the Agency to EAH, and development and
operation on the Property of the Development by EAH.
G. EAH has requested that the Agency provide financial
assistance to assist EAH in performing predevelopment tasks
associated with the Development. To provide such predevelopment
financial assistance, the Agency desires to lend to EAH an amount
not to exceed One Hundred Sixty Thousand Dollars ($160,000) (the
"Predevelopment Loan") pursuant to the terms of Article 2 of this
Agreement.
H. EAH intends to finance the acquisition of the Property
and construction and development of the Development with funds
from an institutional real estate lender, low income housing tax
credit syndication proceeds from equity investors, other public
and private funding sources
.1 and additional development funds
from the Agency, as described below. Exhibit C attached to this
Agreement provides a preliminary proposal for the financing and
development of the Development, including a preliminary estimate
of sources and uses of funds for acquisition of the property and
construction and development of the Development (the "Preliminary
Proposal").
I. In negotiating the DDA, the Agency will consider in
good faith the provision of additional financial assistance in
the form of a loan (the "Development Loan"). A portion of the
Development Loan might constitute a purchase money loan for all
or a part of the-purchase price of the Property, and an
additional portion of the Development Loan might be provided to
pay costs of construction and development of the Development.
The amount, uses, repayments terms, and security for the
Development Loan shall be set forth in the DDA.
J. If the Agency funds the Development Loan pursuant to
the DDA, the parties intend that the principal amount of
Predevelopment Loan will be combined with the principal amount of
the Development Loan to constitute a combined loan (the "Combined
Loan") that will be subject to and repayable in accordance with,
the terms of the DDA.
K. The Agency intends to fund the Predevelopment Loan from
a portion of the tax increment generated within the Tiburon
Redevelopment Project Area (the "Project Area") and deposited in
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the Agency's Low and Moderate Income Housing Fund (the "Housing
Fund") created pursuant to Health and Safety Code Sections
33334.2 and 33334.3.
L. Expenditure of
Predevelopment Loan will
Code Section 33334.2, as
Redevelopment Plan for t:
improving and increasing
housing.
Housing Fund deposits to fund the
serve the purposes of Health and Safety
well as the goals and objectives of the
he Tiburon Redevelopment Project by
the community's supply of affordable
M. The Development is located outside of the Project Area.
Pursuant to Health and Safety Code Section 33334.2(g), the Town
Council and the Agency have adopted resolutions finding that the
acquisition of the Property and development of the Development by
EAH, including performance of the necessary predevelopment tasks
to be paid from proceeds of the Predevelopment Loan, will
benefit the Project Area and assist in the redevelopment of the
Project Area.
N. The Agency intends to apply the units to be developed
in the Development toward satisfaction of its Project Area
housing production obligation under Health and Safety Code
Section 33413(b) in the manner permitted by Health and Safety
Code Section 33413 (b) (2) (A) (ii) , effective January 1, 1994.
NOW, THEREFORE, in consideration of the above recitals and
the mutual promises and covenants set forth in this Agreement,
the parties agree as follows:
ARTICLE 1
EXCLUSIVE NEGOTIATIONS RIGHTS
Section 1.1 Good Faith Negotiations. The Agency and EAH
shall negotiate diligently and in good faith, during the
Negotiating Period described in Section 1.2, the terms of a DDA
for the development of the Development on the Property. The
Preliminary Proposal shall serve as a guide in the negotiations
of the DDA, although the parties acknowledge that review of
additional information and further discussion will lead to
refinement and revision of the development and financing concepts
set forth in the Preliminary Proposal.
Among the issues to be addressed in the negotiations are:
conditions to disposition of the Property by the Agency to EAH,
including the obligations of the parties regarding the rezoning
of the Property by the Town, in its sole policy judgment, in the
manner required for the Development, and for procurement by EAH
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of preliminary reservations or commitments of necessary debt and
equity funds to finance the Development; provision by the Agency
or EAH of necessary off-site improvements to enable development
of the Development in a manner compatible with the surrounding
neighborhood; the amount, uses, repayment terms and security for
the Development Loan; the development schedule for the
Development; the standards for ongoing use, operation, and
maintenance of the Development; and such other terms and
conditions as the parties may mutually determine.
Section 1.2 Negotiating Period. The negotiating period
(the "Negotiating Period") under this Agreement shall be ninety
(90) days, commencing on the date first above written, subject to
extension as provided below. If, in the judgment of the Agency
Executive Director, negotiations with EAH have progressed
sufficiently during the ninety day negotiating period to indicate
that the parties can satisfy all the terms of this Agreement and
present a DDA for Agency Board approval within an additional
sixty (60) days, the Agency Executive Director, on behalf of the
Agency, may extend the Negotiating Period for up to an additional
sixty (60) days with the consent of EAH. In addition, the
Negotiating Period may be extended or modified by formal
amendment of this Agreement executed by the Agency and EAH.
If a DDA has not been executed by the Agency and EAH by the
expiration of the Negotiating Period (as the Negotiating Period
may be extended by operation of the preceding paragraph), then:
(a) the Agency shall have no further obligation to
fund the Predevelopment Loan;
(b) The Agency shall have not further obligation to
negotiate exclusively with EAH under the terms of this Agreement;
(c) any previously disbursed portion of the
Predevelopment Loan shall be repaid or such repayment shall be
forgiven in the manner provided in Section 2.5 below; and
(d) following repayment or forgiveness of the
Predevelopment Loan in the manner provided in Section 2.5 below,
this Agreement shall terminate and neither party shall have any
rights or obligations hereunder, except that the indemnification
provisions of Sections 4.6 and 4.15 shall survive termination of
this Agreement.
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Section 1.3 Exclusive Negotiations. During the Negotiating
Period (as such Negotiating Period may be extended by operation
of Section 1.2), the Agency shall not negotiate with any entity,
other than EAH, regarding development of the Property, or solicit
or entertain bids or proposals to do so.
Section 1.4 Limitation on Effect of Agreement. This
Agreement shall not obligate either the Agency or EAH to enter
into a DDA or to enter into any particular DDA. By execution of
this Agreement, the Agency is not committing itself to or
agreeing to undertake acquisition, disposition, or exercise of
control over any property. Execution of this Agreement by the
Agency is merely an agreement to conduct a period of exclusive
negotiations in accordance with the terms hereof, reserving for
subsequent Agency and Town Council action the final discretion
and approval regarding the execution of a DDA and all proceedings
and decisions in connection therewith (including, without
limitation, any proceedings required pursuant to the California
Environmental Quality Act in connection with consideration of a
DDA). Any DDA resulting from negotiations pursuant to this
Agreement shall become effective only if and after such DDA has
been considered and approved by the Agency and, if required by
law, the Town Council, following conduct of all legally required
procedures.
ARTICLE 2
PREDEVELOPMENT LOAN PROVISIONS
Section 2.1 Predevelopment Loan; Other Predevelopment
Funds. Subject to satisfaction of the conditions set forth in
Section 2.3, the Agency shall lend to EAH the principal sum not
to exceed One Hundred Sixty Thousand Dollars ($160,000) for the
purposes set forth in Section 2.2 of this Agreement. The
Predevelopment Loan shall be evidenced by a promissory note (the
"Predevelopment Note") in substantially the form attached as
Exhibit D. The Predevelopment Note shall be executed by EAH
concurrently herewith.
To preserve Agency funds to the maximum extent possible for
later stages of development, EAH shall exercise diligent good
faith efforts to procure other sources of funding, including,
without limitation, CDBG and/or HOME funds from the County of
Marin and funds from the Marin Community Foundation, to pay for
portions of the predevelopment costs otherwise payable from the
Predevelopment Loan unless these other sources of funding will
substantially reduce the tax credit basis of the Development.
EAH shall provide the Agency with periodic reports concerning
such efforts. The parties shall make an equitable adjustment in
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the amount and uses of the Predevelopment Loan to account for any
other funding source of predevelopment costs procured by EAH in
light of the then anticipated total predevelopment costs.
The Agency shall cooperate with EAH in the procurement of
other predevelopment funds. To meet any site control
requirements of a potential funding source, the Agency Executive
Director is authorized to execute and deliver a commitment
letter, option agreement, or other similar document consistent
with the terms of this Agreement and the contemplated DDA to
evidence the Agency's commitment to provide site control of the
Property to EAH upon satisfaction of standard conditions for
granting site control.
Section 2.2 Use of Funds. Proceeds of the Predevelopment
Loan may be used only for the predevelopment costs of the
Development, generally in the amounts and for the purposes set
forth in Exhibit E to this Agreement, unless the Agency approves
in writing a different use of the funds.
Section 2.3 Conditions to Funding. The Agency shall fund
the Predevelopment Loan in two stages upon satisfaction of the
conditions set forth in subsections (a) and (b) below.
(a) Stage I Portion. The Agency's obligation to fund
the initial portion (the "Stage I Portion") of the Predevelopment
Loan in an amount not to exceed Fifty Thousand Dollars ($50,000)
shall be conditioned upon fulfillment, to the Agency's reasonable
satisfaction, of the following conditions (the "Stage I
Conditions").
(1) Execution by EAH and delivery to the Agency
of the Predevelopment Note and the Assignment (defined in Section
2.4 below); and
(2) Receipt of a written request from EAH setting
forth the proposed use of funds and the amount of funds needed,
stating that no other predevelopment funds are available for such
use, and attaching a copy of the bill or invoice covering the
costs incurred or to be incurred.
Upon satisfaction of the Stage I Conditions and receipt
of such written request(s), the Agency shall from time to time
disburse the Stage I Portion of the Predevelopment Loan (or so
much thereof as is required) for uses and in amounts generally
consistent with those shown in Exhibit E.
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(b) Stage II Portion. The Agency's obligation to fund
the second portion (the "Stage II Portion") of the Predevelopment
Loan in an amount not to exceed One Hundred Ten Thousand Dollars
($110,000) shall be conditioned upon fulfillment, to the Agency's
reasonable satisfaction, of the following conditions (the "Stage
II Conditions") :
(1) Fulfillment of the Stage I Conditions;
(2) Award by the California Tax Credit Allocation
Committee ("TCAC") of a preliminary reservation of tax credits
for the Development in an amount generally consistent with the
amount set forth in the Preliminary Proposal (Exhibit C); and
(3) Receipt of a written request from EAH setting
forth the proposed use of funds and the amount of funds needed,
stating that no other predevelopment funds are available for such
use, and attaching a copy of the bill or invoice covering the
costs incurred or to be incurred.
Upon satisfaction of the Stage II Conditions and
receipt of such written request(s), the Agency shall from time to
time disburse the Stage II Portion of the Predevelopment Loan (or
so much thereof as is required) for uses and in amounts generally
consistent with those shown in Exhibit E.
(c) General Conditions. Notwithstanding any other
provisions of this Agreement, the Agency shall have no further
obligation to disburse any portion of the Predevelopment Loan to
EAH following:
(1) Termination of this Agreement without
execution of a DDA;
(2) Notification by the Agency to EAH of an EAH
default under the terms of this Agreement or the executed DDA;
provided, however, that the Agency shall become obligated again
to disburse Predevelopment Loan funds to EAH pursuant to the
terms of this Agreement if EAH cures the default within the
applicable cure period; or
(3) Termination of the DDA.
Section 2.4. Security. As security for the Predevelopment
Loan, and as part of the consideration for entering into this
Agreement, EAH shall:
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(a) concurrently with execution of this Agreement,
execute and deliver to the Agency an Assignment of Agreements,
Plans, and Specifications (the "Assignment"), in substantially
the form attached to this Agreement as Exhibit F, and shall cause
Dick Olmsted , the architect for the Development, to execute the
consent attached to the Assignment; and
(b) upon a default under Section 4.1 or termination of
this Agreement and forgiveness of the Predevelopment Loan
pursuant to Section 2.5(b), deposit with the,Agency and assign to
the Agency for the Agency's use, all other documents, reports,
surveys, materials, drawings and specifications, and any
information related to the Development prepared by or for EAH
(collectively the "Documents").
Section 2.5. Repayment of the Predevelopment Loan.
(a) If Development Loan is Funded. If the DDA is
executed and all or any portion of Development Loan is funded
pursuant to the terms of the DDA, the Predevelopment Loan shall
become part of the Combined Loan and shall thereafter bear
interest and be repaid in accordance with the terms for repayment
of the Combined Loan to be set forth in the DDA. Prior to such
funding of the Development Loan and incorporation of the
Predevelopment Loan into the Combined Loan, the Predevelopment
Loan shall bear no interest.
(b) If DDA Not Executed or Development Loan Not
Funded. If this Agreement is terminated without execution of a
DDA, or if the executed DDA is subsequently terminated without
funding of any portion of the Development Loan, the principal
amount of the Predevelopment Loan without interest thereon shall
be due and payable by EAH to the Agency within fifteen (15) days
of receipt by EAH of written notice from the Agency of such
payment obligation (the "Repayment Date"), subject to forgiveness
of Predevelopment Loan repayment as follows.
The Agency shall forgive the Predevelopment Loan in
either of the events described above in this subsection (b) if
the following conditions are satisfied:
(1) EAH is not in default under the terms of this
Agreement (as defined in Section 4.1) or the DDA, if applicable,
as of the date of termination of this Agreement or the DDA; and
(2) Prior to the Repayment Date, EAH takes all
actions necessary to implement the assignment of documents,
contracts and approvals pursuant to the Assignment, and deposits
the Documents with the Agency.
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If repayment of the Predevelopment Loan is not
forgiven due to a failure to satisfy one or both of the"preceding
conditions, the principal amount of the Predevelopment Loan shall
bear interest at the rate of eight percent (8%) per annum from
the Repayment Date to the date of repayment in full of the
principal amount of the Predevelopment Loan and any interest due
thereon.
(c) If EAH Defaults. In the event of a default by EAH
under this Agreement (as defined in Section 4.1) or the DDA that
remains uncured after expiration of the applicable cure period,
the principal amount of the Predevelopment Loan shall be
immediately due and payable, and shall bear interest at the rate
of eight percent (8%) per annum from such date to the date of
repayment in full of the principal amount of the Predevelopment
Loan and any interest due thereon.
ARTICLE 3
EAH OBLIGATIONS
Section 3.1 Predevelopment Activities. EAH shall use
diligent good faith efforts to perform the Predevelopment tasks
necessary to permit acquisition of the Property and construction
and development of the Development in a timely manner. Without
limiting the generality of the foregoing, EAH shall prepare and
submit an application for a preliminary tax credit reservation
from TCAC for the Development generally in the amount set forth
in the Preliminary Proposal (Exhibit C) during the second
calendar 1994 round of TCAC applications. Upon reasonable
notice, as from time to time requested by the Agency, EAH shall
make oral or written progress reports advising the Agency on
progress made and next steps to be taken by EAH in the
performance of such predevelopment tasks.
Section 3.2. Affordability
to purchase the Property pursuant
require EAH to record against the
close of escrow, a Regulatory Agri
matters, for occupancy and rental
generally as follows:
Restrictions. If EAH proceeds
to the DDA, the Agency shall
Property concurrently with the
cement providing, among other
of the units in the Development
(a) Four (4) units shall be made available for
occupancy by households with incomes at the time of initial
occupancy that do not exceed sixty percent (60%) of Marin County
median income ("Median Income") (adjusted for household size), at
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a monthly rent payable by such qualifying households (including
utility allowance) that does not exceed one-twelfth (1/12) of
thirty percent (30%) of sixty percent (60%) of Median Income
(adjusted for household size);
(b) Three (3) units shall be made available for
occupancy by households with incomes at the time of initial
occupancy that do not exceed fifty percent (50%) of Median Income
(adjusted for household size), at a monthly rent payable by such
qualifying households (including utility allowance) that does not
exceed one-twelfth (1/12) of thirty percent (30%) of fifty
percent (50%) of Median Income (adjusted for household size);
(c) Nine (9) units shall be made available for
occupancy by households with incomes at the time of initial
occupancy that do not exceed ninety percent (90%) of Median
Income (adjusted for household size), at a monthly rent payable.
by such qualifying households (including utility allowance) that
does not exceed one-twelfth (1/12) of thirty percent (30%) of
ninety percent (90%) of Median Income (adjusted for household
size).
The Regulatory Agreement shall provide that if Article
34 of the California Constitution and/or statues implementing
Article 34 are amended in the future to permit a greater number
of units to be regulated by the Agency for affordability to
households with incomes and at rents described in subsection (a)
and (b) without a vote of the electorate, the number of units
subject to the provisions of subsection (b) shall be increased to
the maximum extent permitted without a vote of the electorate by
such amendment.
The Regulatory Agreement shall have a minimum term of
thirty (30) years from the close of escrow, and shall be in the
form specified in the DIVA.
Upon satisfaction of the requirement of, and to the
extent permitted by Health and Safety Code Section 33334.14(a),
the Agency agrees to subordinate the Regulatory Agreement to the,
lien of the deed of trust securing the construction and permanent
financing for the Development and to the regulatory agreement
recorded in connection with procurement of the tax credit funds.
Section 3.3. Use. The Development shall be used only for
purposes consistent with this Agreement and the DDA.
Section 3.4. Non-Discrimination. EAH covenants by and for
itself and its successors and assigns that there shall be no
discrimination against or segregation of a person or of a group
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of persons on account of race, color, religion, creed, sex,
sexual orientation, marital status, ancestry or national origin
in the sale, lease, sublease, transfer, use, occupancy, tenure or
enjoyment of the Development, or in the hiring, firing, promoting
or demoting of any person engaged in the development or
construction of the Development; nor shall EAH or any person
claiming under or through EAH 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
Development.
Section 3.5. Mandatory Language in All Subsequent Deeds,
Leases and Contracts. All deeds, leases or contracts made or
entered into by EAH, its successors or assigns, as to any portion
of the Development shall contain therein the following language:
(a) In Deeds:
"Grantee herein covenants by and for itself, its successors
and assigns that there shall be no discrimination against or
segregation of a person or of a group of persons on account
of race, color, creed, religion, sex, sexual orientation,
marital status, national origin or ancestry in the sale,
lease, sublease, transfer, use, occupancy, tenure or
enjoyment of the property herein conveyed nor shall the
grantee or any person claiming under or through the grantee
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
herein conveyed. The foregoing covenant shall run with the
land".
(b) In Leases:
"The lessee herein covenants by and for the lessee and
lessee's heirs, personal representatives and assigns and all
persons claiming under the lessee or through the lessee that
this lease is made subject to the condition that there shall
be no discrimination against or segregation of any person or
of a group of persons on account of race, color, creed,
religion, sex, sexual orientation, marital status, national
origin or ancestry in the leasing, subleasing, transferring,
use, occupancy, tenure or enjoyment of the land herein
leased nor shall the lessee or any person claiming under or
through the lessee establish or permit any such practice or
practices of discrimination or segregation with reference to
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the selection, location, number, use or occupancy of
tenants, lessees, sublessees, subtenants, or vendees in the
land 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,
creed, religion, sex, sexual orientation, marital status,
national origin or ancestry in the sale, lease, sublease,
transfer, use, occupancy, tenure or enjoyment of the
property nor shall the transferee or any person claiming
under or through the transferee 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 land".
ARTICLE 4
GENERAL PROVISIONS
Section 4.1. Default. A default shall consist of any
material breach of any covenant, agreement, provision or warranty
contained in this Agreement, the Predevelopment Note or the
Assignment. In the event of a default, the non-defaulting party
shall provide to the defaulting party written notice of the
default, and the defaulting party shall have fifteen (15) days to
cure the default, or, if such default cannot reasonably be cured
within fifteen (15) days, the defaulting party shall commence to
cure within fifteen (15) days and thereafter shall diligently
complete such cure. If, after the time provided in this
paragraph, the defaulting party has not cured the default, and
the non-defaulting party has not waived its rights under this
Agreement, Predevelopment Note and the Assignment:
(a) the non-defaulting party may apply to a court for
specific performance of this Agreement or an injunction against
any violation of this Agreement, or any other remedies at law or
in equity, or any other actions as shall be necessary or
desirable so as to correct non-compliance with this Agreement;
(b) in addition to any other remedy, if the Agency is
the non-defaulting party, all amounts payable under the
Predevelopment Note shall be accelerated and immediately due and
payable, as more fully provided in Section 2.5(c) above, and the
Agency may exercise any of its rights under the Predevelopment
Note and the Assignment; and
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(c) in addition to any other remedy, the non-
defaulting party may terminate this Agreement; provided, however,
that the indemnification provisions of Sections 4.6 and 4.15
shall survive any termination of this Agreement.
Section 4.2. Insurance. EAH shall maintain and keep in
force, at EAH's sole cost and expense, the following insurance
applicable to the Development:
(a) Worker's Compensation insurance, in scope and amount
required by law.
(b) Comprehensive General Liability insurance with limits
not less than $1,000,000 each occurrence.
(c) Comprehensive Automobile Liability insurance with
limits not less than $1,000,000 each occurrence.
EAH shall name the Agency and the Town as a co-insureds on
all insurance policies it obtains covering the Development.
Section 4.3. Relationship of Parties. Nothing contained in
this Agreement shall be interpreted or understood by any of the
parties, or by any third persons, as creating the relationship of
employer and employee, principal and agent, limited or general
partnership, or joint venture between the Agency and EAH or EAH's
agents, employees or contractors, and EAH shall at all times be
deemed an independent contractor and shall be wholly responsible
for the manner in which it or its agents, or both, perform the
services required of it by the terms of this Agreement for the
development of the Development. In regards to the development of
the Development, EAH shall be solely responsible for all matters
relating to payment of its employees, including compliance with
Social Security, withholding and all other laws and regulations
governing such matters, and shall include requirements in each
contract that contractors shall be solely responsible for similar
matters relating to their employees. EAH agrees to be solely
responsible for its own acts and those of its agents and
employees.
Hooper, Olmsted & Hrovat has been selected by EAH as the
architect for the Development, and EAH may, from time to time,
select other consultants, contractors, and vendors for the
Development. Notwithstanding the preceding paragraph, the Agency
shall have the right to provide input regarding the selection
and, if necessary, the replacement of such other consultants,
contractors, or vendors employed by EAH to perform the
predevelopment tasks contemplated by this Agreement, and shall
have the right to provide input regarding the replacement of the
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previously selected architect, if necessary. EAH shall consider
in good faith such input from the Agency, and shall confer with
the Agency, upon request, regarding such selection and
replacement decisions.
Section 4.4. No Third Party Beneficiaries. There shall be
no third party beneficiaries to this Agreement.
Section 4.5. Amendments. No alteration or variation of the
terms of this Agreement shall be valid unless made in writing by
the parties.
Section 4.6. Indemnification. Except as directly caused by
the Agency's gross negligence, EAH agrees to indemnify, protect,
hold harmless and defend (by counsel reasonably satisfactory to
the Agency) the Agency, the Town and their respective board
members, officers and employees, from all suits, actions,'claims,
causes of action, costs, demands, judgments and liens arising out
of:
(a) EAH's performance or non-performance under this
Agreement, the Predevelopment Note, the Assignment, or any other
agreement executed by EAH in furtherance of its obligations
hereunder;
(b) EAH's performance or non-performance with respect
to EAH's development, ownership, operation and/or management of
the Development; or
(c) acts or omissions of any of EAH's consultants,
contractors, subcontractors, or agents, or persons claiming under
any of the aforesaid.
Section 4.7. Non-Liability of Agency and Town Officials,
Employees and Agents. No member, official, employee or agent of
the Agency or the Town shall be personally liable to EAH, 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 EAH or its
successor or on any obligation under the terms of this Agreement.
Section 4.8. Action by the Agency. Except as may be
otherwise specifically provided herein, whenever any approval,
notice, direction, consent, request, extension of time, waiver of
condition, termination, or other action by the Agency is required
or permitted under this Agreement, such action may be given,
made, or taken by the Agency Executive Director, without further
approval by the Agency Board, and any such action shall be in
writing. The amount of the Predevelopment Loan may not be
increased without approval of the Agency Board.
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established working relationship with residents of the
neighborhood surrounding the Property; and that therefore, the
limitations on assignment of rights and obligations under this
Agreement set forth in this Section 4.11 are essential to protect
and implement the Agency's public interest in the development of
the Property.
Section 4.12. Attorneys' Fees. If any lawsuit is
commenced to enforce any of the terms of this Agreement, the
prevailing party shall have the right to recover its reasonable
attorneys' fees and costs of suit from the other party.
Section 4.13. Severability. If any term of this Agreement
is held by a court of competent jurisdiction to be invalid, void
or unenforceable, the remainder of the provisions shall continue
in full force and effect unless the rights and obligations of the
parties have been materially altered or abridged by such
invalidation, voiding or unenforceability.
Section 4.14. Exhibits. The following exhibits are
attached to and incorporated by reference in this Agreement:
Exhibit A
Exhibit B
Exhibit C
Exhibit D
Exhibit E
Exhibit F
Section 4.15. Brokers.
Legal Description of Property
Design Concept for Development
Preliminary Proposal
Form of Predevelopment Note
Schedule of Predevelopment Costs
Assignment
(a) The Agency represents that it has not had any
contact or dealings regarding the Property, or any communication
in connection with the subject matter of this Agreement, through
any real estate broker or other person who can claim a right to a
commission or finder's fee. If any broker or finder makes a
claim for a commission or finders' fee based upon a contract,
dealings, or communications with the Agency, then the Agency
shall indemnify, defend with counsel of EAH's choice, and hold
EAH harmless from all expense, loss, damage and claims, including
attorneys' fees, if necessary, arising out of the broker's or.
finder's claim.
10200N.P50
03/10/94 16
Section 4.9. Notices, Demands and Communications. Formal
notices, demands, and communications between the Agency and EAH
shall be sufficiently given if and shall not be deemed given
unless dispatched by registered or certified mail, postage
prepaid, return receipt requested, or delivered by express
delivery service, return receipt requested, or delivered
personally, to the principal office of the Agency and EAH as
follows:
AGENCY:
Tiburon Redevelopment Agency
1155 Tiburon Boulevard
Tiburon, CA 94920
Attn: Executive Director/Town Manager
EAH:
Ecumenical Association for Housing
2169 East Francisco Boulevard, Suite B
San Rafael, CA 94901
Attn: Executive Director
Such written notices, demands and communications may be sent
in the same manner to such other addresses as the affected party
may from time to time designate by mail as provided in this
Section 4.9. Receipt shall be deemed to have occurred on the
date shown on a written receipt for delivery or refusal of
delivery.
Section 4.10. Applicable Law. This Agreement shall be
governed by California law.
Section 4.11. Parties Bound Limitation on Assignment.
Except as otherwise limited herein, the provisions of this
Agreement shall be binding upon and inure to the benefit of the
parties and their heirs, executors, administrators, legal
representatives, successors and assigns.
Notwithstanding the foregoing, EAH shall not transfer any of
its rights or obligations under this Agreement without the prior
written approval of the Agency, which approval may be granted or
denied in the Agency's sole discretion. EAH acknowledges and
agrees that the identity of the developer of the Development is
critical to the Agency; that the Agency is entering into this
Agreement in reliance upon EAH's special expertise in the
development of affordable housing developments and its
10200N.PS0
03/10/94 15
established working relationship with residents of the
neighborhood surrounding the Property; and that therefore, the
limitations on assignment of rights and obligations under this
Agreement set forth in this Section 4.11 are essential to protect
and implement the Agency's public interest in the development of
the Property.
Section 4.12. Attorneys' Fees. If any lawsuit is
commenced to enforce any of the terms of this Agreement, the
prevailing party shall have the right to recover its reasonable
attorneys' fees and costs of suit from the other party.
Section 4.13. Severability. If any term of this Agreement
is held by a court of competent jurisdiction to be invalid, void
or unenforceable, the remainder of the provisions shall continue
in full force and effect unless the rights and obligations of the
parties have been materially altered or abridged by such
invalidation, voiding or unenforceability.
Section 4.14. Exhibits. The following exhibits are
attached to and incorporated by reference in this Agreement:
Exhibit A
Exhibit B
Exhibit C
Exhibit D
Exhibit E
Exhibit F
Section 4.15. Brokers.
Legal Description of Property
Design Concept for Development
Preliminary Proposal
Form of Predevelopment Note
Schedule of Predevelopment Costs
Assignment
(a) The Agency represents that it has not had any
contact or dealings regarding the Property, or any communication
in connection with the subject matter of this Agreement, through
any real estate broker or other person who can claim a right to a
commission or finder's fee. If any broker or finder makes a
claim for a commission or finders' fee based upon a contract,
dealings, or communications with the Agency, then the Agency
shall indemnify, defend with counsel of EAH's choice, and hold
EAH harmless from all expense, loss, damage and claims, including
attorneys' fees, if necessary, arising out of the broker's or
finder's claim.
10200N.PS0
03/10/94 16
(b) EAH represents that it has not had any contact or
dealings regarding the Property, or any communication in
connection with the subject matter of this Agreement, through any
real estate broker or other person who can claim a right to a
commission or finder's fee. If any broker or finder makes a
claim for a commission or finder's fee based upon a contract,
dealings, or communications with EAH, EAH shall indemnify, defend
with counsel of the Agency's choice, and hold the Agency harmless
from all expense, loss, damage and claims, including attorneys'
fees, if necessary, arising out of the broker's or finder's
claim.
IN WITNESS WHEREOF, this Agreement has been entered into by
the undersigned as of the date first above written.
EAH:
ATTEST:
ECUMENICAL ASSOCIATION FOR
HOUSING a California nonprofit
public benefit corporation
By: Acq,"I I t~ M
vin nne
Its : Assistant Secretary
AGENCY:
TIBURON REDEVELOPMENT AGENCY,
a public body, corporate and
politic
By: By:
Its
APPROVED AS TO FORM:
By. zffi-4e
Agency Counsel
10200N.P50
03/10/94 17
EXHIBIT A
LEGAL DESCRIPTION OF THE PROPERTY
10200N.P50
03/10/94 A-1
EXHIBIT A
LEGAL DESCRIPTION OF THE PROPERTY
ALL MMT C EMMM zeal ply situate in the City of Tiburon, Camty of Marin,
State of California, described below as follows:
Parcel A, as shotiaz tpm that certain Parcel Map entitled "Map of Tiburon
Ri xds, Town of Tiburon, Marin (b., State of California", filed for record
Ikmember 1, 1988 in Book 20 of Maps, at page 50, Marin Comty Rem=Ls.
EXHIBIT B
DESIGN CONCEPT FOR DEVELOPMENT
10200N.P50
03/10/94 B-1
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EXHIBIT C
PRELIMINARY PROPOSAL
10200N.P50
03/10/94 C-1
Highlands Site, Tiburon
PROPOSED HOUSING DEVELOPMENT OUTLINE
A. PROPOSED FEATURES OF HOUSING PROJECT
1. Rental: Low and Very Low Income Elderly Tenants
2. Number of Dwelling Units: 16
a. Fifteen One-Bedroom Units: Approx. 575 sq.ft.
b. One One-Bedroom Unit with Office for Resident
Manager •
C. Commons Building with Laundry Room
3. Units to be One-Story Cottages: Frame Construction
with pitched shingled roofs and individual private
outdoor areas.
4. Outdoor Commons (Plaza) Area '
5. Parking for at least Sixteen Cars
B. PROJECTED FINANCING
1. Conventional Mortgage 26%
2. Redevelopment Agency (Inc. Land Loan) 38%
3. Other Sources (MCF, CDBG, HOME) 12%
4. Equity (Low Income Housing Tax Credits) 23%
Federal Low Income Tax Credits are secured through a
competitive process through the California Tax Credit
Allocation Committee. The Credits shall be sold to a
California corporate investor with net proceeds to be
contributed to pay project costs.
If, because of changes to the Tax Credit program, the
project fails to secure an allocation of Tax Credits,
EAH shall pursue alternative financing.
1
C. OWNERSHIP STRUCTURE
1. First Fifteen Years: California Limited Partnership
a. General Partner: EAH Affiliated Nonprofit
Corporation
b. Limited Partner: California Corporation
After approximately fifteen years, the General Partner _
expects to buy out all interests held by the Limited
Partner.
2. Remaining Life of Project: EAH Affiliate Nonprofit
Corporation •
D. PROJECT DESIGN PROCESS
•
EAH and the Town of Tiburon envision the project design process
to be conducted through an open public process to include all
interested residents of the Bel Aire Neighborhood. A regular
series of regular meetings conducted by EAH with the project
architect shall be scheduled for this purpose.
B. PREDEVELOPMENT LOAN
The Tiburon Redevelopment Agency shall provide an interim
predevelopment loan of $50,000 to EAH for development of the
project. The funds shall be used by EAH to pay some of the
project costs as required for architectural planning, '
engineering, legal costs and application fees. Monthly expense
statements will be prepared and submitted with copies of related
invoices to the Agency. This loan shall be retired with proceeds
from the costruction loan closing. In the event the project
fails to be built by EAH, the balance of unexpended funds shall
be returned to the Agency and the loan forgiven. All related
plans, reports and applications shall also be turned over to the
Agency. EAH shall apply for additional predevelopment funding
from other local sources.
F. REDEVELOPMENT LOANS
1. Land Loan: A loan equal to the appraised value of the
Highlands site shall be provided by the Tiburon
Redevelopment Agency. A note term of fifty-five years
with an interest rate of zero is preferred. A related
loan agreement shall provide for rental restrictions
for low income elderly residents. This loan shall be
subordinated to the construction and permanent loans.
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2. Improvements Loan: A loan as required to compensate
for the project financing gap (total cost minus total...,
fund sources) shall be provided by the Tiburon
Redevelopment Agency. The term of the note shall be at
least thirty years and carry an interest rate for which
accruals do not create a capital gains tax at the time
of sale by the limited partnership (approximately three
percent). Payments made on this note shall be from
surplus cash flow (residual receipts). This loan shall
be subordinated to the construction and permanent
loans.
G. PROPERTY MANAGEMENT
Property management services shall be provided by EAH throughout
the life of the project.
.
EXHIBIT D
FORM OF PREDEVELOPMENT NOTE
PROMISSORY NOTE
$160,000
Tiburon, California
, 1994
FOR VALUED RECEIVED, Ecumenical Association for Housing, a
California nonprofit public benefit corporation (the "Borrower"),
promises to pay to the Tiburon Redevelopment Agency (the "Agency"), or
order, the principal sum of One Hundred Sixty Thousand Dollars
($160,000), or so much thereof as is advanced to Borrower pursuant to
Article 2 of the Predevelopment Loan Agreement (as defined below), as
provided below.
1. Predevelopment Loan Agreement. This promissory note (the
"Note") is made pursuant to the terms of the Exclusive Negotiating
Rights and Predevelopment Loan Agreement for Tiburon Highlands
Development dated as of March 16, 1994 entered into between the
Borrower and the Agency (the "Predevelopment Loan Agreement"). All
capitalized terms used but not defined in this Note shall have the
meanings set forth in the Predevelopment Loan Agreement.
2. Repayment Terms. The indebtedness evidenced by this Note
shall be due and payable at the times and in the manner set forth in
Section 2.5 of the Predevelopment Loan Agreement, and subject to the
terms and obligations set forth in the Predevelopment Loan Agreement.
3. Late Charge. The Borrower acknowledges that late payment of
amounts owing under this Note will cause the Agency to incur costs not
contemplated by this Note, the exact amount of such costs being
difficult and impractical to asses. Such costs include without
limitation, processing and accounting charges. Therefore, if any
payment under this Note is not received within thirty (30) days of the
date due, the Borrower agrees to pay to the Agency an additional
amount of one Hundred Dollars ($100) as a late charge. The parties
agree that the late charge represents a reasonable sum considering all
the circumstances existing at the date of the execution of this Note
and represents a fair and reasonable estimate of the costs the Agency
would incur by reason of late payment and that proof of actual damages
10200N.P50
03/10/94
D-1
would be costly and inconvenient. Acceptance of a late charge shall
not constitute a waiver of default and shall not prevent the Agency
from exercising any other rights or remedies available to the Agency.
4. Assignment. As part of the security for this Note, Borrower
shall assign to the Agency certain rights and obligations as provided
in the Assignment executed concurrently herewith.
5. Acceleration. As more fully set forth in Section 2.5(c) of
the Predevelopment Loan Agreement, upon the occurrence of an event of
default in the Predevelopment Loan Agreement, the Agency shall have
the right to declare all of the principal immediately due and payable,
which amount shall bear interest at the rate of eight percent (8%) per
annum from such date to the date of repayment in full of the principal
amount of the Predevelopment Loan and any interest due thereon.
Neither acceptance by the Agency of the payments provided for herein
nor any failure by the Agency to pursue its legal and equitable
remedies upon default shall constitute a waiver of the Agency's right
to require prompt payments when due of all principal and interest
owing or to declare a default and exercise all of its rights under
this Note, the Predevelopment Loan Agreement, and the Assignment.
6. No Offset. The Borrower hereby waives any rights of offset
it now has or may hereafter have against the Agency, its successors
and assigns, and agrees to make the payment called for herein in
accordance with the terms of this Note.
7. Waiver; Attorney's Fees. The Borrower and any endorsers or
guarantors of this Note for themselves, their heirs, legal
representatives, successors and assigns, respectively, severally waive
diligence presentment, protest and demand, and notice of protest,
dishonor and non-payment of this Note, and expressly waive any rights
to be released by reason of any extension of time or change in terms
of payment, or change, alteration or release of any security given for
the payments hereof, and expressly waive the right to plead any and
all statutes of limitations as a defense to any demand on this Note or
agreement to pay the same, and jointly and severally agree to pay all
costs of collection when incurred, including reasonable attorneys'
fees. If an action is instituted on this Note, the undersigned-
promises to pay, in addition to the costs and disbursements allowed by
law, such sum as a court may adjudge reasonable as attorneys' fees in
such action.
8. Manner and Place of Payment. All payments of principal and
interest shall be payable in lawful money of the United States of
America at the office of the Agency as set forth in Section 4.9 of the
Predevelopment Loan Agreement or at such other address as the Agency
may provide to the Borrower by notice in accordance with Section 4.9
of the Predevelopment Loan Agreement.
10200N.P50
03/10/94 D-2
9. Recourse Note. This Note shall be recourse against the
Borrower. A judgement or execution thereof and entered in any action,
legal or equitable, on this Note may be enforced personally against
the Borrower.
10. Assignment. The Agency's rights under this Note may be
assigned by the Agency in its discretion.
11. Conflict. If any term or provision of this Note conflicts
with any term or provision of the Predevelopment Loan Agreement, the
term or provision of the Predevelopment Loan Agreement shall control
to the extent of such conflict.
ECUMENICAL ASSOCIATION FOR HOUSING, a
California nonprofit public benefit
corporation
By: Mhll i &Tnieklt --AKk
vin TrMett
Its: Assistant Secretary
10200N.P50
03/10/94 D-3
EXHIBIT E
PREDEVELOPMENT COST SCHEDULE
Predevelopment Cost Item Estimated Cost
10200N.P50
03/10/94 E-1
1F
1
l BIT E
, l
PREDEV=Pi+ EN COST
SG rnF
o
Predevelonment C
st Item
Estimated Cost
1
Architect: 'Plan, Development
$ $30,000
Architect: Construction Drawings & Bid
$30,000
Engineering (Predevelopment Phase Only)
$30foo0
Structural
Mechanical
F
Electrical
Landscape Arcbit4ct (Predevelopment Prase
Only) $10,000
Civil Engineer f
$10,000
Soils Engineer .i(Predevelopment Phase only)
$10,000
Legal: Transaction
$10,000
Legal: Organizatioaal
$5,000 -
CaTCAC Application Fee
$2,000
CaTCAC Reservation Fee
'
$5,000
Soft
Cost Contingency
$18,000
$16o,oob
I C120ON-PSO `
03124/9¢ E-~-
EXHIBIT F
FORM OF ASSIGNMENT AGREEMENT
ASSIGNMENT OF AGREEMENTS, PLANS AND SPECIFICATIONS,
AND APPROVALS ("ASSIGNMENT")
FOR VALUE RECEIVED, the undersigned, Economical Association for
Housing, a California nonprofit public benefit corporation ("EAH"),
hereby assigns and transfers to Tiburon Redevelopment Agency, a public
body corporate and politic ("Agency"), all of its right, title and
interest in and to:
(1) All architectural, design, engineering, and construction
contracts and development agreements, and any and all
amendments, modifications, supplements, addenda and general
conditions thereto (collectively "Agreements"), heretofore
or hereafter entered into by any Contractor (as defined
below) ;
(2) All plans and specifications, shop drawings, working
drawings, amendments, modifications, changes, supplements,
general conditions and addenda thereto (collectively "Plans
and Specifications") heretofore or hereafter prepared by any
Contractor (as defined below); and
(3) All land use approvals, building permits, and other
governmental approvals of any nature obtained for the
Development (collectively, the "Land Use Approvals").
This Assignment is made pursuant to the terms of the Exclusive
Negotiating Rights and Predevelopment Loan Agreement for Tiburon
Highlands Housing Development dated as of March 161 1994 entered into
between EAH and the Agency (the "Predevelopment Loan Agreement").
Capitalized terms used but not defined in this Assignment shall have
the meanings set forth in the Predevelopment Loan Agreement. The
Property with respect to which the Agency has made the Predevelopment
Loan to EAH under the Predevelopment Loan Agreement is described in
Attachment No. 1 attached to this Assignment.
For purposes of this Assignment, the term "Contractor" means any
architect, construction contractor, engineer or other person or entity
entering into Agreements with EAH and/or preparing Plans and
Specifications for EAH with respect to the Development.
EAH hereby irrevocably appoints Agency as its attorney-in-fact
(which agency is coupled with an interest) to, upon the occurrence of
default or an event which, with notice or the passage of time or both
would constitute a default under and as defined in Section 4.1 of the
Predevelopment Loan Agreement, demand, receive, and enforce any and
all of EAH's rights with respect to the Plans and Specifications,
10200N.P50
03/10/94 F-1
Agreements and Land Use Approvals and perform any and all acts in the
name of EAH or in the name of Agency with the same force and effect as
if performed by EAH in the absence of this Assignment.
EAH represents and warrants to Agency that no previous
assignment(s) of its rights or interest in or to the Plans and
Specifications, Agreements and/or Land Use Approvals has or have been
made, and EAH agrees not to assign, sell, pledge, transfer, mortgage,
or hypothecate its rights or interest therein (without written
approval of the Agency Executive Director) so long as Agency holds or
retains any security interest in the Property.
This Assignment is made to secure: (1) payment to the Agency of
all sums now or hereafter owing under the Predevelopment Note dated as
of the date hereof made by EAH to the order of the Agency, and any and
all additional advances, modifications, extensions, renewals and
amendments thereof; and (2) payment and performance by EAH of all its
obligations under the Predevelopment Loan Agreement and the DDA.
This Assignment shall be governed by the laws of the State of
California, except to the extent that Federal laws preempt the laws of
the State of California, and EAH consents to the jurisdiction of any
Federal or State Court within the State of California having proper
venue for the filing and maintenance of any action arising hereunder
and agrees that the prevailing party in any such action shall be
entitled, in addition to any other recovery, to reasonable attorneys'
fees and costs.
This Assignment shall be binding upon and inure to the benefit of
the heirs, legal representatives, assigns, and successors-in-interest
of EAH and Agency; provided, however, this shall not be construed and
is not intended to waive the restrictions on assignment, sale,
transfer, mortgage, pledge, hypothecation or encumbrance by EAH
contained in the Predevelopment Loan Agreement or the DDA.
Attachment No. 1 and the Architect's/Engineer's Consent are
attached hereto and incorporated herein by reference.
Executed by EAH on April 4 , 1994.
" EAH It
ECUMENICAL ASSOCIATION FOR HOUSING,
a California
nonprofit public benefit
corporation
By: 4W
Execut ,Ave Direst r
10200N.P50
03/10/94 F-2
ARCHITECT'S/ENGINEER'S CONSENT
The undersigned architect and/or engineer (collectively referred
to as "Architect") hereby consents to the foregoing Assignment of
Agreements, Plans and Specifications, and Approvals ("Assignment"), of
which this Architect's/Engineer's Consent ("Consent") is a part, and
acknowledges that there presently exists no unpaid claims presently
due to the Architect except as disclosed to Agency arising out of the
preparation and delivery of the Plans and Specification to EAH and/or
the performance of the Architect's obligations under the Agreements
described therein.
Architect agrees that if, at any time, Agency shall become the
owner of said Property, or, pursuant to its rights under the
Predevelopment Loan Agreement or the DDA, elects to undertake or cause
the completion of construction of the Development on any of the
Property, in accordance with the Plans and Specifications, and gives
Architect written notice of such election; then so long as the
Architect has received, receives or continues to receive the
compensations called for under the Agreements, Agency may, at its
option, use and rely on the Plans and Specifications for the purposes
for which they were prepared, and Architect will continue to perform
its obligations under the Agreements for the benefit and account of
Agency in the same manner as if performed for the benefit or account
of EAH in the absence of this Assignment.
Architect further agrees that, in the event of a breach by EAH of
the Agreements, or any agreement entered into with Architect in
connection with the Plans and Specifications, so long as EAH's
interest in the Agreements and Plans and Specifications is assigned to
Agency, Architect will give written notice to Agency at the address
shown below of such breach. Agency shall have thirty (30) days from
the receipt of such written notice of default to remedy or cure said
default; provided, however, nothing herein shall require Agency to
cure said default or to undertake completion of construction of the
Improvements.
Architect warrants and represents that it/he/she has no knowledge
of any prior assignment(s) of any interest in either the Plans and
Specifications and/or the Agreements. Except as otherwise defined
herein, the terms used herein shall have the meanings given them in
the Assignment or the Predevelopment Loan Agreement, as applicable.
10200N.P50
03/10/94 F-3
Executed on this 0I of M , 1994.
Address of Architect:
Architect: (JZ
BY: X~~(h ~
. ps-d~w Pe&n- 1~ 660
Address of Agency.:
Tiburon Redevelopment Agency
1155 Tiburon Boulevard
Tiburon, CA 94920
Attention: Executive Director
]0200N.P50
03/ ] 0/94 F-4
ATTACHMENT NO. 1 TO ASSIGNMENT
PROPERTY DESCRIPTION
10200N.P50
03/10/94 F-5