City of Culver City, California
Agenda Item Report
1
Meeting Date: March 21, 2011 Item Number: JPH-1
JOINT CITY COUNCIL/REDEVELOPMENT AGENCY BOARD AGENDA ITEM: JOINT
PUBLIC HEARING - (1) Adoption of a City Council Resolution Approving Density
and Other Bonus Incentives for a Three Story Mixed Use Building with 10,700
Square Feet of Commercial Space and 33 Residential Units Located at 11042-11056
West Washington Boulevard; (2) Adoption of a City Council Resolution Making
Certain Findings and Approving a Disposition and Development Agreement and the
Sale of Property at 11054-11056 West Washington Boulevard to Tilden Terrace, LP;
and (3) Adoption of an Agency Board Resolution Making Certain Findings and
Approving a Disposition and Development Agreement with Tilden Terrace, LP for
the Construction of a Three Story Mixed Use Building with 10,700 Square Feet of
Commercial Space and 33 Residential Units Located at 11042-11056 West
Washington Boulevard; and (4) Approval of a Budget Amendment Appropriating
Low- and Moderate-Income Housing Funds.
Contact Person/Dept.: John Fisanotti
Susan Yun
Tevis Barnes
Phone Number: (310) 253-5767
(310) 253-5755
(310) 253-5782
Fiscal Impact: Yes [X] No [] General Fund: Yes [X] No []
Public Hearing: [X] Action Item: [] Attachments: [X]
Commission Action Required: Yes [X] No [] Date: March 15, 2011
Public Notification
(USPS) All Property Owners and Occupants Within a 500 Foot Radius of the Site
(approximately 1,900 recipients) (2/24/11); (E-Mail) Meetings and Agendas – City Council
(2/24/11) (On-Site Posting_ Notice of Public Hearing (2/10/11); (Newspaper Publishing) In
the Culver City News (03/03/11 and 03/10/11); Meetings and Agendas – City Council
(03/17/11); Meetings and Agendas - Redevelopment Agency (03/17/11)
Department Approval
Sol Blumenfeld (03/17/11)
Agency General Counsel Approval:
Murray O. Kane (03/17/11)
City Attorney Approval:
Carol Schwab (by H. Baker) (03/17/11)
Chief Financial Officer Approval:
Jeff Muir (03/17/11)
City Manager/Executive Director Approval:
John M. Nachbar (03/17/11)
RECOMMENDATION:
Staff recommends the City Council:
(1) Determine that no new information has become available and no changes in
the proposed project have been made since the Planning Commission’s adoption
of a Mitigated Negative Declaration related to the project and, therefore, no
additional environmental analysis is required; and,
(2) Adopt a resolution approving Density Bonus, DOBI P-2011015, subject to
the project Conditions of Approval (Attachment No. 1); and, City of Culver City, California
Agenda Item Report
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(3) Adopt a resolutionpursuant to Section 33433 of the California Health and
Safety Code making certain findings and approving a Disposition and
Development Agreement and the sale of 11054-11056 West Washington
Boulevard, which was purchased by the Culver City Redevelopment Agency with
tax increment funds (Attachment No. 2); and
(4) Approve a budget amendment appropriating $11,805,000 from Low-
Moderate Income Funds (which are now held in one of the City’s Special
Revenue Fund).
A budget amendment requires a 4/5ths vote.
AND
Staff recommends the Redevelopment Agency Board (Agency Board):
(1) Determine that no new information has become available and no changes in
the proposed project have been made since the Planning Commission’s adoption
of a Mitigated Negative Declaration related to the project and, therefore, no
additional environmental analysis is required; and
(2) Adopt a Resolution making certain findings and approving a Disposition and
Development Agreement (DDA) (Attachment No. 3) between the Culver City
Redevelopment Agency (Agency) and Tilden Terrace, LP, for the sale of 11054-
11056 West Washington Boulevardand subsequent development of 11042-
11056 West Washington Boulevard (Attachment No. 4)
PROCEDURE:
(1) Presiding Officer seeks motion from the City Council and Agency Board to
receive and file the affidavit of publication of notice and all
correspondence received in response to the public hearing notices
(Attachment Nos. 10 and 11).
(2) Presiding Officer calls for a staff report and/or poses questions to staff as
desired.
(3) Presiding Officer opens the public hearing.
(4)
(5) Presiding Officer seeks motion to close the Public Hearing after all
audience testimony, including any written testimony, has been presented.
(6) City Council considers the DOBI and arrives at its decision.
(7) City Council and Agency Board consider the draft DDA and the proposed
sale of the property and arrives at their respective decisions.
City of Culver City, California
Agenda Item Report
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BACKGROUND:
The proposed project is the product of efforts by the Redevelopment Agency and the
City to redevelop this area of Washington Boulevard with a high quality development
that promotes commercial revitalization as well as provision of affordable housing in
accordance with the Redevelopment Agency’s Comprehensive Housing Strategy
and the City’s 2008-2014 General Plan Housing Element.
The Redevelopment Agency acquired the blighted Pleasantview convalescent
facility (11056 Washington Boulevard) and the Arco Electric Company (11054
Washington Boulevard) in 2006-2008 for demolition and redevelopment.|1010| The
adjacent commercial building is vacant and will be incorporated in the proposed
project. The Agency commenced negotiations with the developer, Los Angeles
Housing Partnership (LAHP) in 2010 to redevelop the site as well as the adjoining
properties subject to the terms and conditions of a DDA between the Agency and
LAHP.|1010|
The Agency’s expectation is to develop a place-making project that provides
affordable housing, and promotes area redevelopment and revitalization. Toward
that end, staff has worked diligently over the last four months with LAHP and the
community to incorporate design and revitalization programming that enhances the
street and is fitting with the adjacent residential neighborhood. The proposed project
is designed as a high quality mixed used development with ample plazas and
setbacks to provide affordable housing and opportunities for outdoor dining and
landscaping. The retail component is considered as important to the project as the
residential component and is designed to communicate effectively with the street
and sidewalks. The retail spaces will include design features that help ensure
quality retail tenants with attractive storefronts and signage. The materials, colors,
and textures of the building are intended to evoke quality and permanence. The
building finishes include corten steel, wood, and an abundant use of glass. The
building includes stepbacks and setbacks to create an attractive building form and
provide visual interest. Clerestory windows are used to provide light to the
residential units and common areas. The Agency has also programmed funds to
improve the public spaces with new street furniture, crosswalks, and landscaping
and will provide a commercial rehabilitation program for some of the adjacent
commercial properties.
DISCUSSION:
The proposed project consists of a 3-story, 35-foot high, mixed use building with
10,700 square feet of ground floor commercial space and a total of 33 residential
units at the second and third levels (48,525 square feet overall). The total units
proposed include a density bonus of 35% as allowed by State law for the provision
of affordable housing. The proposed project will provide a total of 106 parking City of Culver City, California
Agenda Item Report
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spaces (41 surface parking spaces for the commercial visitors, employees and
residential guests and 65 spaces in a one-level subterranean garage for the
residential tenants consistent with parking code requirements).
A number of on-site amenities for residents are available in the project including a
700 square foot community/recreational room, a 440 square foot cyber library
computer lab fully equipped for educational use, two large interior central courtyards
totaling 4,440 square feet with benches and tables for passive recreational activities,
a laundry facility on both the second and third floors and a 860 square foot
community garden at the roof level. Project offsite improvements include new
sidewalks, street furniture and street trees and new landscaped medians adjacent to
the site as well as various operational and circulation improvements at the adjacent
intersections of Washington Boulevard including Washington Place, Tilden Avenue
and Harter Avenue.
On March 3, 2010 the Planning Commission unanimously approved the project
entitlements which include a Site Plan Review (SPR), for the development of a three
story mixed use residential building with one level of subterranean parking; an
Administrative Modification (AM) to reduce the parking drive aisle width to
accommodate the shift of the building northward to accommodate a planting screen
at-grade; and a Density Bonus Incentive (DOBI) to allow for an increase in the base
residential unit density in exchange for the provision of affordable housing consistent
with State law.(Please see Attachment No. 6, Planning Commission Staff Report). A
follow-up meeting of the Planning Commission was conducted on March 15, 2011
and at that meeting the Commissionadopted Resolution No. 2011-P003 (Attachment
No. 7), (i) adopting a Mitigated Negative Declaration in accordance with the
California Environmental Quality Act (CEQA) finding the Project, as mitigated, will
not result in significant adverse environmental impacts; (ii) approving the Site Plan
Review and Administrative Modification; and (iii) recommending approval of the
Density Bonus for the project subject to the conditions of approval. The Initial
Study/Mitigated Negative Declaration dated February 24, 2011, is Attachment No. 8.
The Planning Commission’s decision on the Mitigated Negative Declaration, Site
Plan Review and Administrative Modification is final unless appealed.
On March 7, 2010, the Agency Board approved a Letter of Commitment/MOU and
an Option Agreement with LAHP, in anticipation of, and subject to, subsequent
approval of a DDA with LAHP. The terms and conditions outlined in the MOU are
reflected in the draft DDA. This unusual step was deemed necessary in light of the
uncertainty created by the Governor’s proposal to eliminate redevelopment agencies
statewide.
3
The Commission and Agency Board approval followed an extensive
public outreach effort with four community meetings and widespread notification to
surrounding residential and commercial property owners.
4
Pursuant to Section
33433 of the California Health and Safety Code, a report analyzing the proposed
sale of the property and draft DDA has been prepared and is Attachment No. 9.
City of Culver City, California
Agenda Item Report
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Staff is recommending that the City Council approve the Density Bonus Incentive
and adopt the attached resolution. The proposed project will produce 32 units of
affordable, for rent housing, which will be covenanted for 55 years, pursuant to
California Community Redevelopment Law (“CRL”).
The proposed project is comprised of the following mix of bedrooms sizes:
Bedroom Size Total
One Bedroom 2
Two Bedroom* 19
Three Bedroom 12
Total 33
*Includes 1 Two Bedroom Unit as the Manager’s Unit
The proposed project will consist of new construction of 33 units of rental housing to
be occupied by and restricted to very low, low and moderate income households at
affordable rents (with the exception of one Manager’sUnit), for at least 55 years and
10,700 square feet of commercial space. The mix of affordable units is depicted in
the chart below.
Density Bonus and Other Incentives:
The proposed project includes an increased number of residential units for the
provision of affordable housing consistent with the provisions of State Density Bonus
law (California Government Code Section 65915, et. seq.) and as stipulated in the
Culver City Zoning Code where the processing of density increase requests are
consistent with Government Code Section 65915. The proposed project meets the
requirements of State density bonus law in that it provides an adequate number of
affordable housing units for the percentage increase in density.
The base density for the proposed project is 25 dwelling units at the 35 dwelling
units per acre, permitted pursuant to the mixed use development standards. The
project includes 8 additional units which equates to an increase of 35% over the
Affordability Level
Units
Very Low 14
Low 6
Moderate (up-to-120%
AMI)
12
Manager Unit 1
TOTAL 33 City of Culver City, California
Agenda Item Report
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base density for a total of 33 dwelling units proposed at the site. The State allows a
maximum of a 35% increase in density provided that 11% of the base units are in
the very low income or 20% are in the low income category. The proposed project
meets (or exceeds) this minimum criterion for allowing density increase by providing
14 units at the very low category, 6 units in the low category, and 12 units in the
moderate category. There will be one manager’s unit that will be at market rate.
The DOBI process includes review of the proposed project and conditions of
approval intended to address any potential impacts associated with the density
increase. The SPR also addresses these potential impacts and the discussion on
traffic, off-site improvements, and site design further illustrate how the proposed
project, with its density increase, will not impact the community. As noted above, the
Planning Commission has conditionally approved and recommends that the City
Council approve the Density Bonus based on the findings pursuant to Culver City
Municipal Code (CCMC) Section 17.580.020 findings, as outlined in the proposed
City Council Resolution, Attachment No. 1.
Environmental Determination
Pursuant to CEQA guidelines, an Initial Study and Mitigated Negative Declaration
finding was prepared and circulated for review for the proposed project. On March
15, 2011, the Planning Commission adopted a Mitigated Negative Declaration
finding that the project, as mitigated, will not result in significant adverse
environmental impacts. No new information has become available and no changes
in the proposed project have been made since the adoption of the Mitigated
Negative Declaration; therefore, no additional environmental analysis is required
Pursuant to the CCMC, residential development at this location can be
accomplished only within a mixed use development. Accordingly, the proposed
project complies with the City’s mixed use development standards by providing
10,700 gross square feet of commercial space on the ground floor. Occupancy of
this space, which will be subdivided into a number of leasehold spaces, will be
closely controlled pursuant to the draft DDA. In the draft DDA, the Agency and/or
the City (as the City may be assigned the rights, responsibilities, and obligations of
the Agency) have the authority to review and approve prospective tenants before
they sign a lease. This will ensure that the quality of the tenants, which is an integral
component to the success of the project, is maintained.
FISCAL ANALYSIS:
The total cost of the proposed project is estimated at $23,986,500. The draft DDA
provides a cap for the Agency’s contribution at $15,200,000. The balance of the
funding is proposed to be provided by LAHP through tax credit financing from the
State Tax Credit Allocation Committee. The tax credit financing is critical and unless
and until it is awarded to LAHP, the project won’t go forward. City of Culver City, California
Agenda Item Report
7
As stated in the Section 33433 Report, the Agency spent $4,402,000 to purchase its
two parcels, and another $401,546 on related acquisition and ownership expenses.
These expenses were paid by the Agency from its non-restricted 80% tax increment
funds.
The majority of the funding to be contributed to the project by the Agency comes
from the 20% Low- and Moderate-Income Housing Set Aside money(Housing
Funds. At the beginning of Fiscal Year 2010/2011, there was a little more than
$17,000,000 of Housing Funds available for capital investment. There are, however,
project related expenses to be funded by the Agency which are an ineligible use of
Housing Fund monies. Therefore, some of the subsidy must come from non-
Housing Funds. The Agency’s financial consultant, Keyser Marston Associates,
analyzed the Developer’s pro-forma and associated drawings and concluded that
80% of the building expenses can be attributed to the affordable housing units and
are, therefore, an eligible use of Housing Funds. Thus, the $15,200,000 subsidy will
be formalized by a Note secured by a Deed of Trust for $11,805,000 (funding to
come from the Housing Funds and repaid back to Housing Funds) and another Note
secured by a Deed of Trust for $3,395,000 (funding to come from the a Special
Revenue Operating Fund recently created to account for the Agency’s 80% tax
increment funds and repaid to same.) Both of these Notes are residual receipts
Notes, meaning that during the term of the Notes, debt will be serviced from any
residual receipts available after all other project operating and fixed debt expenses
have been paid. Each Note is at 3% interest and matures in 55 years, which is
consistent with the term of the affordability covenant. At the conclusion of the term,
the outstanding principal and interest will be due.
The terms of the draft DDA establish a purchase price for the subject parcels at
$3,400,000. There will be no cash to City at escrow closing. Because of the
restrictions and covenants that affect the developer’s cost, the fair re-use value is a
negative $11.8 million. The purchase price becomes part of the assistance to the
project and is repaid through the two Notes. To reflect the use of the property for
affordable housing, it is proposed that the City authorize transfer of $4,202,000 from
Housing Funds to the Special Revenue Operating Fund. This action will reimburse
the original acquisition cost of the property from 80% tax increment funds. Because
the proposed project cannot proceed unless and until LAHP receives the tax credit
financing, the recommended motion in this report authorizes staff to enact this
budget amendment and transfer, contingent upon having all project funding
approved and available.
ATTACHMENTS:
1. Proposed City Council Resolution approving Density Bonus, DOBI P-
2011015, subject to the Conditions of Approval City of Culver City, California
Agenda Item Report
8
2. Proposed City Council Resolution making certain findings and approving a
Disposition and Development Agreement and the sale of 11054-11056
West Washington Boulevard
3. Draft Disposition and Development Agreement between the City, the
Agency, and Tilden Terrace, LP
4. Proposed Agency Resolution making certain findings and approving a
Disposition and Development Agreement
5. Schedule of recent multi-family housing production in Culver City
6. Planning Commission Staff Report dated March 3, 2011
7. Planning Commission Resolution No. 2011-P003
8. Initial Study/Negative Declaration dated February 24, 2011
9. Summary Report pursuant to Section 33433
10. Affidavit of Proof of Publication
11. Written public comments received by March 15, 2011
MOTION:
That the City Council:
1. Determine that there is no new information or substantial changes to the project
since the Planning Commission’s adoption of the Mitigated Negative Declaration
and, therefore, no additional environmental analysis is required; and
2. Adopt a Resolution approving Density Bonus, DOBI P-2011015, subject to the
Conditions of Approval; and
3. Adopt a Resolution making certain findings and approving a Disposition and
Development Agreement and the sale of 11054-11056 West Washington
Boulevard, which was purchased by the Culver City Redevelopment Agency with
tax increment funds, to Tilden Terrace, LP, pursuant to Section 33433 of the
California Health and Safety Code; And
4. Authorize the City Attorney to review/prepare the necessary documents; and,
5. Authorize the City Manager to execute such documents on behalf of the City; and
6. Approve a budget amendment appropriating $11,805,000 from Low-Moderate
Income Funds (which are now held in one of the City’s Special Revenue Funds)
contingent upon the Developer receiving the tax credit financing and all other financing
necessary for the proposed project to proceed.
A budget amendment requires a 4/5ths vote.
AND
City of Culver City, California
Agenda Item Report
9
That the Agency Board:
1. Determine that there is no new information or substantial changes to the
project since the Planning Commission’s adoption of the Mitigated Negative
Declaration and, therefore, no additional environmental analysis is required;
and
2. Adopt a Resolution making certain findings and approving a Disposition and
Development Agreement between the City of Culver City, the Culver City
Redevelopment Agency and Tilden Terrace, LP, for the sale of 11054-11056
West Washington Boulevard and subsequent development of 11042-11056
West Washington Boulevard; and
3. Authorize Agency General Counsel to review/prepare the necessary
documents; and,
4. Authorize the Executive Director to execute such documents on behalf of the
Agency.
NOTES:
1. The Agency negotiated the purchase of 11056 West Washington Boulevard (the site
of the former Pleasantview Facility) in December 2006 and proceeded with
demolishing the improvements the following spring. By June of 2008, the property at
11054 West Washington Boulevard, which formerly housed the Arco Electric
Company, was acquired through a negotiated purchase. This property remains
vacant. The only other property on the block between Tilden Avenue and Harter
Avenue (11042-52 West Washington Boulevard) remains in private ownership, as
the Agency considered, but never actively pursued, acquisition of this property. The
Agency’s site is two contiguous parcels in the CG zone, consisting of 22,763 square
feet. In 2006 and again in 2008, the Agency issued Requests for Proposals to the
development community to solicit proposals for the development of the Agency’s
properties however, no satisfactory proposals were received. The Agency also
considered unsolicited proposals which were received from time to time, and until
recently, did not find them acceptable.
2. The Agency received an unsolicited request from LAHP to participate with LAHP in
the development of the block for a mixed use, affordable housing development. On
December 13, 2010, the Agency Board authorized an Exclusive Negotiation
Agreement with LAHP for the sale and development of the Agency owned
properties. Two weeks later, LAHP closed escrow on its purchase of the remaining
parcel on the block. Under the ENA, LAHP, and staff have pursued an aggressive
schedule to negotiate a DDA and obtain entitlements for the proposed project in
order for LAHP to apply for tax credit financing by a March 23, 2011 application
deadline. The project proposed for the combined Agency and LAHP owned
properties is referred to as Tilden Terrace, and LAHP has formed a limited
partnership (Tilden Terrace, LP) whose managing general partner is LAHP to
develop the site, subject to Agency Board and City Council approvals. City of Culver City, California
Agenda Item Report
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3. On January 15, 2011, the City and the Agency entered into a Cooperation
Agreement Relating to the Funding of Public Infrastructure Improvements and
Affordable Housing Projects (the “Cooperation Agreement”). The Cooperation
Agreement includes funding for a number of affordable housing developments
including the Agency’s holdings at 11054-56 West Washington Boulevard, referred
collectively in the Cooperation Agreement as the Pleasantview Site. On March 7,
2011, the City Council and Agency Board approved a series of actions designed to
implement the Cooperation Agreement, including a transfer of the Agency property
and other Agency assets to the City and an assignment to the City of the Agency’s
obligations under the Commitment Letter and Option Agreement for Tilden Terrace.
Staff is now recommending that the City become an additional party to the
Disposition and Development Agreement in order to carry out the Project.
4. At the direction of the Agency Board, and pursuant to the City’s Community Outreach
Guidelines, LAHP hosted community meetings on September 16, 2010, October 13,
2010, and January 13, 2011 and March 2, 2011. LAHP also conducted many one-
on-one meetings, walked door-to-door through the neighborhood, and sought input
from various stakeholders and community organizations (ACOR, the Chamber of
Commerce, and the Exchange Club) and conducted tours of its projects with
Community Development Department staff on September 17, 2010 and residents
and Agency Board Members on November 19, 2010.
In the initial community meetings there was a significant concern expressed about
the existing conditions in the neighborhood. In particular, concerns were expressed
about the demand for on-street parking, vehicle and pedestrian circulation at the
Washington Boulevard/Washington Place/Tilden Avenue. intersection, and the
elimination of on-street parking for street sweeping purposes around the King Fahad
Mosque at noon on Fridays, when parking demand at the nearby Mosque peaks.
The proposed project includes off-site improvements as well as street sweeping
schedule revisions, and the establishment of permit parking intended to address
these concerns. The actions of LAHP and staff over the last six months were
sufficient in addressing the concerns raised by the neighborhood and the proposed
project is now widely supported.
5. In March 2008, the Agency Board reviewed and approved the implementation of
Years 1-2 of the Comprehensive Housing Strategy (CHS). The CHS intends to
improve the City’s affordable housing stock and meet housing production
requirements under the Regional Housing Needs Assessment (RHNA) through the
use of Redevelopment Agency Housing Set Aside Funds. The purpose of the
Housing Set Aside Fund is to “preserve, improve and increase the supply of
affordable housing” (Health and Safety Code Section 33334.2(a)).
Culver City’s RHNA requirement over the next 7 years is 504 housing units, with 294
units designated for very-low, low and moderate income households.
The CHS is based on the concept of mixed-income, low-density, scattered site
affordable housing developments. Based upon the RHNA requirements, the City
must annually develop approximately 17 units of very-low income, 10 units of low-
income and 11 units of moderate income housing. During the last RHNA cycle, the City of Culver City, California
Agenda Item Report
11
City only produced 29% of its allocation of 650 units. Since 2000, the City, on
average, only creates 8.1 units of multi-family housing per year and has only created
twenty-three (23) units of affordable housing. Attachment No. 5 depicts the City
multi-family housing production over the last 11 years.
Regional Housing Needs Assessment Goals for Culver City
Number
of Units
Income Category % of Area
Median
Income*
Max.
Income
Limits+
129 Very-low 50 $75,600
80 Low 80 $66,250
85 Moderate 120 $74,500
211 Above Moderate
(Market)
Above 120 Unrestri
cted
*2010 Los Angeles Median Income = $63,000
+Income Limits based upon a household size of four (4) persons
The housing production sites approved for implementation under Years 1 -2 of the
CHS are depicted in the chart below. These sites have the potential to yield 73 units
which include 56 units designated for low to moderate income households. On July
26, 2010, the Agency Board approved an Affordable Housing Agreement for the
development of the 4043 Irving Site. This project will yield 28 units of housing with
12 units of affordable housing. The Agency Board approved the release of a Request
for Proposal on November 22, 2010 to solicit a qualified developer to develop 4044-
4068 Globe Avenue. The Globe RFP submission deadline was January 20, 2011.
CHS – Years 1 – 2
SITE UNITS HOUSING TYPE AFFORDABILITY
4044-4068
Globe
Avenue
12 Townhomes/
Ownership
8 moderate
4 low
4043 Irving
Place*
28 Rental Housing
Units
16 market
9 moderate
3 low
11042-
11056
Washington
Blvd.
33 Mixed-use/Rental 12 moderate
6 low
14 very low
1 manager
Total 73 16 market
29 moderate
13 low
14 very low
*Replaces 4075 Lafayette
City of Culver City, California
Agenda Item Report
12
6. Established in 1989, the Los Angeles Housing Partnership (LAHP) is a non-profit
public benefit agency whose mission is to expand, ensure the long-term affordability,
and preserve the supply of decent affordable housing in the City and County of Los
Angeles for low to moderate income households and the homeless. LAHP’s real
estate track record includes new construction of rental housing, major rehabilitation,
historic preservation, mixed-use, and community facilities as well as the development
of for-sale single family residences. LAHP’s portfolio includes 1,200 multi-family units
which LAHP both owns and operates with rents affordable to a broad mixture of
households, ranging from moderate income families to homeless veterans.
Attachment A provides a listing of LAHP properties. Since 2009, LAHP has
leveraged over $52.5 million in public financing, $29 million in conventional
permanent debt, over $55 million in investor equity, and over $2.2 million in the
Affordable Housing Program (AHP). LAHP is also an approved distributing agency of
the Los Angeles Regional Food Bank and manages 2 food bank distribution
programs in Hollywood and MacArthur Park that serve over 9,000 hungry individuals
and families every year.
MEETING DATE: March 21, 2011
AGENDA ITEM: JOINT CITY COUNCIL/REDEVELOPMENT AGENCY BOARD
AGENDA ITEM: Public Hearing for (1) Adoption of a City Council Resolution Approving
Density for a Three Story Mixed Use Building with 10,700 Square Feet of Commercial Space
and 33 Residential Units Located at 11042-11056 West Washington Boulevard; (2) Adoption of
a City Council Resolution Making Certain Findings and Approving the Disposition and
Development Agreement and the Sale of Property at 11054-11056 West Washington
Boulevard to Tilden Terrace, LP; and (3) Adoption of an Agency Board Resolution Making
Certain Findings and Approving a Disposition and Development Agreement with Tilden
Terrace, LP for the Construction of a Three Story Mixed Use Building with 10,700 Square Feet
of Commercial Space and 33 Residential Units Located at 11042-11056 West Washington
Boulevard; and Approval of a Budget Amendment and Transfer of Funds from the Low- and
Moderate-Income Housing Fund to the Tax Increment Fund.
ATTACHMENTS
Pages
1. City Council Resolution No. 2011-RXX approving Density Bonus, 1 - 5
DOBI P-2011015, subject to the Conditions of Approval
2. City Council Resolution No. 2011-RXX making certain findings 6 - 12
and approving a Disposition and Development Agreement
and the sale of 11054-11056 West Washington Boulevard
3. Draft Disposition and Development Agreement between 13 – 250
the Culver City Redevelopment Agency (“Agency”) and
Tilden Terrace, LP
4. Agency Resolution No. 2011-AXX making certain findings 251 - 257
and approving a Disposition and Development Agreement
5. Schedule of recent multi-family housing production in Culver City 258
6. Planning Commission Staff Report dated March 3, 2011 259 - 274
7. Planning Commission Resolution No. 2011-P003 275 - 308
8. Initial Study/Negative Declaration dated February 24, 2011 309 - 335
9. Summary Report pursuant to Section 33433 336 - 339
10. Affidavit of Proof Of Publication 341 - 342
11. Written public comments received by March 15, 2011 343 - 395
ATTACHMENT 1
1ATTACHMENT 1
2ATTACHMENT 1
3ATTACHMENT 1
4ATTACHMENT 1
5ATTACHMENT 2
6ATTACHMENT 2
7ATTACHMENT 2
8ATTACHMENT 2
9ATTACHMENT 2
10ATTACHMENT 2
11ATTACHMENT 2
12
DISPOSITION AND DEVELOPMENT AGREEMENT
By and Between
THE CULVER CITY REDEVELOPMENT AGENCY,
a public body, corporate and politic,
and
THE CITY OF CULVER CITY,
a charter city of the State of California
and
TILDEN TERRACE, L.P.,
a California limited partnership
(11042-11056 West Washington Boulevard)
ATTACHMENT 3
13
i
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS ........................................................................................................... 2
ARTICLE II SUBJECT OF THIS AGREEMENT .................................................................... 15
Section 201 Purpose of Agreement ..............................................................................15
Section 202 The Redevelopment Plan ...........................................................................15
Section 203 The Redevelopment Project Area ............................................................16
Section 204 The Site ....................................................................................................16
Section 205 Parties to the Agreement ..........................................................................16
Section 206 Prohibition Against Transfers; Right of First Refusal ...............................16
ARTICLE III DISPOSITION OF THE AGENCY PARCEL .................................................... 18
Section 301 Sale and Purchase ....................................................................................18
Section 302 Condition of Title .......................................................................................19
Section 303 Condition of the Agency Parcel .................................................................19
Section 304 Hazardous Substances ..............................................................................20
Section 305 Developer’s Due Diligence ......................................................................21
Section 306 Survey ......................................................................................................21
Section 307 Conditions to Close of Escrow ................................................................22
Section 308 Escrow......................................................................................................23
Section 309 Conveyance of Title and Delivery of Possession ....................................25
Section 310 Form of Grant Deed ...................................................................................25
Section 311 Time For and Place For Delivery of Grant Deed .......................................25
Section 312 Recordation of the Deed ..........................................................................26
Section 313 Title Insurance ...........................................................................................26
Section 314 Taxes and Assessments ............................................................................26
Section 315 Real Estate Commissions. ........................................................................26
ARTICLE IV DEVELOPMENT OF THE PROJECT ................................................................. 26
Section 401 Agency Assistance .....................................................................................26
Section 402 Scope of Development ...............................................................................27
Section 403 Project Construction Drawings and Related Documents ...........................27
Section 404 Agency Approval of Project Plans, Drawings and Related Documents ..28
Section 405 Project Development Costs ......................................................................29
Section 406 Schedule of Performance ...........................................................................29
Section 407 Local, State, and Federal Laws ................................................................30
Section 408 Nondiscrimination During Construction ..................................................31
Section 409 Insurance ..................................................................................................31
Section 410 Indemnification ........................................................................................33
Section 411 Developer’s Relocation Obligations ........................................................34
Section 412 Disclaimer of Responsibility by the Agency .............................................34
Section 413 Rights of Access ......................................................................................34
Section 414 Taxes, Assessments, Encumbrances and Liens .........................................34
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Section 415 Security Financing; Right of Holders ......................................................35
Section 416 Rights to Plans ...........................................................................................35
Section 417 Hazardous Materials ................................................................................36
Section 418 Release of Construction Covenants ...........................................................36
ARTICLE V USE OF THE PROPERTY ..................................................................................... 37
Section 501 Uses ..........................................................................................................37
Section 502 Selection of Commercial Tenants ............................................................38
Section 503 No Housing Set Aside Subsidy of Commercial Space ............................40
Section 504 Management Plan; Annual Project Budget; Quarterly Reports .................41
Section 505 Maintenance of the Site .............................................................................41
Section 506 Lead-Based Paint. ....................................................................................42
Section 507 Barriers to the Disabled .............................................................................43
Section 508 Creation of Capital Reserve Accounts .......................................................43
Section 509 Deposits Into Capital Reserve Accounts ..................................................43
Section 510 Obligation to Refrain from Discrimination ..............................................43
Section 511 Form of Nondiscrimination and Nonsegregation Clauses .........................44
Section 512 Effect and Duration of Covenants ............................................................45
Section 513 Effect of Violation of Covenants ...............................................................45
Section 514 Monitoring .................................................................................................45
ARTICLE VI DEFAULTS, REMEDIES AND TERMINATION............................................... 46
Section 601 Defaults; Notice of Cure; Cure Rights .......................................................46
Section 602 Institution of Legal Actions .......................................................................46
Section 603 Applicable Law ........................................................................................47
Section 604 Acceptance of Service of Process ............................................................47
Section 605 Rights and Remedies Are Cumulative .......................................................47
Section 606 Specific Performance .................................................................................47
Section 607 Termination by Agency .............................................................................47
Section 608 Termination by Developer .........................................................................48
Section 609 Termination by Either Party.......................................................................48
Section 610 Right of Reentry .........................................................................................49
Section 611 Agency’s Option to Purchase .....................................................................51
Section 612 Limited Recourse Obligations ...................................................................53
Section 613 Litigation Costs. .........................................................................................54
ARTICLE VII GENERAL PROVISIONS ................................................................................... 54
Section 701 Developer’s Warranties. ..........................................................................54
Section 702 Notices, Demands and Communications between the Parties ...................55
Section 703 Conflicts of Interest..................................................................................56
Section 704 Nonliability of Agency and City Officials and Employees .......................56
Section 705 Extension of Times of Performance ........................................................56
Section 706 Inspection of Books and Records ............................................................57
Section 707 Use of Project Images ..............................................................................57
Section 708 Legal Incapacity of Agency .......................................................................57
Section 709 Agency Indemnification of City ..............................................................58
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Section 710 Action or Approval ..................................................................................58
Section 711 Assurances to Act in Good Faith ...............................................................59
Section 712 Real Estate Commissions ...........................................................................59
Section 713 Interpretation ............................................................................................59
Section 714 Severability ..............................................................................................59
Section 715 No Third Party Beneficiaries .....................................................................59
Section 716 Authority to Sign......................................................................................60
Section 717 Titles and Captions. ...................................................................................60
Section 718 Gender and Number. ................................................................................60
ARTICLE VIII ENTIRE AGREEMENT, WAIVERS AND AMENDMENTS ........................ 60
ARTICLE IX TIME FOR ACCEPTANCE OF AGREEMENT BY THE AGENCY; DATE OF
AGREEMENT .................................................................................................... 61
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EXHIBITS
EXHIBIT NO. 1-A - LEGAL DESCRIPTION OF DEVELOPER PARCEL
EXHIBIT NO. 1-B - LEGAL DESCRIPTION OF AGENCY PARCEL
EXHIBIT NO. 1-C - LEGAL DESCRIPTION OF SITE
EXHIBIT NO. 2 - SITE MAP
EXHIBIT NO. 3 - METHOD OF FINANCING
EXHIBIT NO. 4 - SCHEDULE OF PERFORMANCE
EXHIBIT NO. 5 - SCOPE OF DEVELOPMENT
EXHIBIT NO. 6 - PROJECT BUDGET
EXHIBIT NO. 7 - GRANT DEED
EXHIBIT NO. 8 - RESIDENTIAL PROMISSORY NOTE
EXHIBIT NO. 9 - RESIDENTIAL DEED OF TRUST
EXHIBIT NO. 10 - AGREEMENT CONTAINING COVENANTS
EXHIBIT NO. 11 - COMMERCIALCOMMERCIAL PROMISSORY NOTE
EXHIBIT NO. 12 - COMMERCIALCOMMERCIAL DEED OF TRUST
EXHIBIT NO. 13 - ASSIGNMENT OF RENTS AND LEASES
EXHIBIT NO. 14 - ASSIGNMENT OF AGREEMENTS
EXHIBIT NO. 15 - ENVIRONMENTAL INDEMNITY
EXHIBIT NO. 16 - UCC1 FINANCING STATEMENT
EXHIBIT NO. 17 - NOTICE OF AFFORDABILITY RESTRICTIONS ON
TRANSFER OF PROPERTY
EXHIBIT NO. 18 - RELEASE OF CONSTRUCTION COVENANTS
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DISPOSITION AND DEVELOPMENT AGREEMENT
This DISPOSITION AND DEVELOPMENT AGREEMENT (“DDA”) dated for
identification purposes only March 21, 2011 is entered into by and between THE CULVER
CITY REDEVELOPMENT AGENCY, a public body, corporate and politic, (“Agency”), THE
CITY OF CULVER CITY, a charter city of the State of California (“City”) and TILDEN
TERRACE, L.P., a California limited partnership (“Developer”). The Agency, the City and
Developer (collectively, the “Parties”) hereby agree as follows:
RECITALS
A. Developer holds or will hold fee title to the property located at 11042-11052 West
Washington Boulevard and described in Exhibit No. 1-A (the “Developer Parcel”) and the
Agency holds fee title to the property located at 11054-11056 West Washington Boulevard and
described in Exhibit No. 1-B (the “Agency Parcel”, collectively with the Developer Parcel
referred to herein as the “Site”).
B. Developer proposes to develop the Site with thirty-three (33) units of affordable
rental housing for very low, low and moderate income households and approximately 10,700
square feet of ground floor retail, office, and community space in accordance with the terms of
this DDA and the plans dated January 18, 2011 that were approved by the Planning Commission
of the City of Culver City on March 3, 2011.
C. The Agency is a public body, corporate and politic, exercising governmental
functions and powers and organized and existing under the Community Redevelopment Law of
the State of California (California Health and Safety Code Section 33000 et seq.).
D. Pursuant to the Community Redevelopment Law, the Agency has established a
Housing Set Aside Fund and has deposited therein certain tax revenues made available to the
Agency exclusively for the purpose of increasing, improving and preserving the community’s
supply of affordable low and moderate income housing (“Set Aside Funds”).
E. The Agency desires to meet its affordable housing goals pursuant to the
Community Redevelopment Law by conveying the Agency Parcel to the Developer and making
a loan to the Developer of Set Aside Funds in the approximate amount of ELEVEN MILLION
EIGHT HUNDRED FIVE THOUSAND DOLLARS ($11,805,000) (the “Residential Loan”),
subject to and conditioned upon the terms and conditions of this DDA, to assist the Developer in
development of the Project as hereinafter defined.
F. The Agency also desires to make a loan to Developer, which shall not be funded
with Set Aside Funds, in the approximate amount of THREE MILLION THREE HUNDRED
NINETY FIVE THOUSAND DOLLARS ($3,395,000) (the “Commercial Loan”), subject to and
conditioned upon the terms and conditions of this DDA, to assist the Developer in the
development of the Project as hereinafter defined.
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G. The Agency issued to the Developer a loan commitment letter dated March 8,
2011 (the “Loan Commitment”), in which the Agency committed to make the Residential Loan
and the Commercial Loan for the Project, subject to Developer’s satisfaction of certain
conditions, which Loan Commitment recites that it is assignable by the Agency to the City.
H. The Agency and the Developer entered into that certain Option Agreement dated
March 8, 2011 (the “Developer Option”), by which the Agency granted an option to the
Developer to purchase the Agency Parcel, which Developer Option recites that it is assignable by
the Agency to the City.
I. The Agency and the City entered into that certain Cooperation Agreement dated
January 15, 2011, as amended by that certain First Amendment to Cooperation Agreement dated
February __, 2011 and that certain Second Amendment to Cooperation Agreement dated March
__, 2011 (collectively, the “Cooperation Agreement”) obligating the City to, among other things,
carry out the Project and obligating the Agency to, among other things, pay the City’s costs of
carrying out the Project.
J. In furtherance of the Cooperation Agreement and to achieve important public
purposes, the Agency has heretofore conveyed the Agency Parcel and other Agency owned
properties to the City and has transferred the Agency’s cash accounts (the “Housing and
Redevelopment Funds”) to the City.
K. In furtherance of the Cooperation Agreement and to achieve important public
purposes, the Agency has heretofore assigned to the City all of the Agency’s rights, interests and
obligations relating to the Commitment Letter and the Developer Option and the City has
accepted and assumed all such rights, interests and obligations.
L. It is the intent of the Parties that the City and the Agency cooperate to carry out
the duties and obligations of the Agency set forth in this DDA, without resulting liability to the
City and without relieving the Agency of its duties and obligations hereunder.
NOW, THEREFORE, in consideration of the promises and covenants contained herein,
the above recitals, and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE I DEFINITIONS
For purposes of this DDA, the following capitalized terms shall have the following
meanings:
“Acquisition Costs” shall mean Developer’s cost of acquiring the Site in the amount set
forth in the Project Budget.
“Affiliate” shall mean (i) any party directly or indirectly controlling, controlled by or
under common control with another party, (ii) any party owning or controlling 10% or more of
the outstanding voting securities of such other party, (iii) any officer, director or partner of such
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party, or (iv) if such other party is an officer, director or partner, any company for which such
party acts in any such capacity.
“Affordable Rent” shall mean the monthly payments charged to and paid by tenants to
the Developer for the use and occupancy of a Restricted Unit and facilities associated therewith,
including a reasonable allowance for utilities. Affordable Rent shall mean
(a) for Very Low Income Units, rental rates not to exceed thirty percent (30%) times
fifty percent (50%) of Area Median Income adjusted for household size appropriate to the unit.
(b) for Low Income Units, rental rates not to exceed thirty percent (30%) times sixty
percent (60%) of Area Median Income adjusted for household size appropriate to the unit.
(c) for Moderate Income Units, rental rates not to exceed thirty percent (30%) times
one hundred ten percent (110%) of Area Median Income adjusted for household size appropriate
to the unit.
As used in this definition of “Affordable Rent” the phrase “adjusted for household size
appropriate to the unit” means a household size equal to the number of bedrooms in the unit plus
one. Affordable Rent shall include a reasonable utility allowance for tenant-paid utilities based
on the Los Angeles County Housing Authority’s published utility schedules.
“Affordable Units” or “Restricted Units” shall mean the Very Low Income Units, the
Low Income Units and the Moderate Income Units and shall not include the Commercial Space.
“Agency” shall mean the Culver City Redevelopment Agency, a public body, corporate
and politic, having its offices at 9770 Culver Boulevard, Culver City, CA 90230-0507, and any
assignee of, or successor to, the rights, powers, and responsibilities of the Agency.
“Agency Loan” shall mean the Residential Loan and the Commercial Loan in a total
cumulative amount not to exceed FIFTEEN MILLION TWO HUNDRED THOUSAND
DOLLARS ($15,200,000.00).
“Agreement Containing Covenants” shall mean that certain Agreement Containing
Covenants and Declaration of Covenants and Restrictions, substantially in the form attached
hereto as Exhibit No. “10”, which is incorporated herein by this reference.
“Area Median Income” shall mean the area median income of Los Angeles County,
with adjustments for household size, as estimated annually by the United States Department of
Housing and Urban Development pursuant to Section 8 of the United States Housing Act of
1937 as amended and published by California’s Housing and Community Development
Department pursuant to Health and Safety Code section 50093.
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“Anti-Terrorism Laws” shall mean all laws relating to terrorism or money laundering,
including, without limitation, the Executive Order and the Bank Secrecy Act, as amended by the
USA Patriot Act.
“Assignment of Agreements” shall mean the assignment by Developer to the Agency of
plans, contracts and permits, substantially in the form attached hereto as Exhibit No. “14”, which
is incorporated herein by this reference.
“Assignment of Rents and Leases” shall mean a document substantially in the form
attached hereto as Exhibit No. “13”, which is incorporated herein by this reference.
“Bank Secrecy Act” shall mean the Currency and Foreign Transactions Reporting Act of
1970, Pub. L. No. 91-508, 84 Stat. 1305 (1970), as amended from time to time.
“City” shall mean the City of Culver City, California, a charter city of the State of
California, having its offices at 9770 Culver Boulevard, Culver City, CA 90230-0507, and any
assignee of, or successor to, the rights, powers, and responsibilities of the City.
“Commercial Deed of Trust” shall mean the Deed of Trust with Assignment of Rents
attached as Exhibit No. “12” hereto, in which Developer is the Trustor and the Agency is the
Beneficiary, which secures the Commercial Loan.
“Commercial Loan” shall mean the Agency’s loan to Developer in an amount not to
exceed THREE MILLION THREE HUNDRED NINETY-FIVE THOUSAND DOLLARS
($3,395,000.00), as evidenced by the Commercial Note and secured by the Commercial Deed of
Trust.
“Commercial Loan Documents” shall mean the Commercial Note, the Commercial
Deed of Trust, the Assignment of Rents, the Assignment of Agreements, and the Environmental
Indemnity.
“Commercial Note” shall mean that certain Promissory Note evidencing the Commercial
Loan, substantially in the form attached hereto as Exhibit No. “11.”
“Commercial Operating Costs” shall have the same meaning as the definition of
Annual Commercial Operating Expenses set forth in the Commercial Note.
“Commercial Space” shall mean that portion of the Project developed for use as retail,
office and community space (and all ancillary areas associated therewith) in conformity with this
Agreement and the Scope of Development.
“Commercial Tenants” shall mean those businesses or organizations that are approved
by the Agency to occupy the Commercial Space pursuant to the terms of this Agreement.
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“Completion” shall mean, with regard to development of the Project, the satisfaction of
each of the following events: (i) the Agency shall have determined that development of the
Project has been completed substantially in accordance with the plans approved by the Agency,
(ii) certificates of occupancy shall have been issued with respect to all of the Units, (iii) the time
for Developer’s contractor, suppliers and subcontractors to file a claim pursuant to Civil Code
Sections 3115-3117 has expired or Developer has delivered to the Agency unconditional lien
releases for its contractor, suppliers and subcontractors, and any mechanic’s liens that have been
recorded or stop notices that have been delivered have been paid, settled or otherwise
extinguished, discharged, released, waived, bonded around or insured against, provided that a
notice of completion pursuant to Civil Code Section 3117 has been duly recorded in the land
records of Los Angeles County. Provided, however, that “Completion” of the Commercial shall
mean the satisfaction of each of the events described in clauses (i) and (iii) above, provided that
Developer has posted a bond, in an amount and form reasonably required by the Agency, for the
performance of remaining punch list items.
“Construction Deed of Trust” shall mean the deed of trust securing the Construction
Loan.
“Construction Financing Event” shall mean the point in time when all conditions
precedent to the conveyance of the Agency Parcel to Developer and the funding of the
Residential Loan, the Commercial Loan and the Construction Loan have been satisfied, in
accordance with the Method of Financing.
“Construction Lender” shall mean either JPMorgan Chase Bank, Bank of America,
Wells Fargo Bank, Citibank or another institutional lender approved by the Agency.
“Construction Loan” shall mean a loan of construction funds from the Construction
Lender in the amount set forth in the final approved Project Budget.
“Construction Loan Documents” shall mean, in addition to the Construction Deed of
Trust, a loan agreement, promissory note, financing statement, guaranties, and similar documents
and instruments to be executed by Developer in connection with the Construction Loan.
“Construction Period” shall mean the period of time commencing upon the
Construction Financing Event and ending upon the Conversion Date.
“Conversion Date” shall mean either (i) the date that all of the conditions precedent to
the funding of the Permanent Loan have been satisfied and the Construction Loan has been
repaid in full, evidenced by the recording against the Site of a reconveyance of the Construction
Loan Deed of Trust or (ii) the date the Construction Loan is converted to the Permanent Loan.
“Days” shall mean calendar days and the statement of any time period herein shall be
calendar days and not working days, unless otherwise specified.
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“DDA” or “Agreement” shall mean this DDA executed by and between the Agency and
Developer, including all exhibits attached hereto, which exhibits are incorporated herein by this
reference and all other documents incorporated herein by reference.
“Developer” shall mean TILDEN TERRACE, L.P., a California limited partnership,
whose address is 1200 Wilshire Boulevard, Suite 307
Los Angeles, California 90017, and any permitted assignee or nominee. The Managing General
Partner of the Developer is LOS ANGELES HOUSING PARTNERSHIP, INC., a California
non-profit public benefit corporation.
“Developer Equity” shall mean funds provided by the Developer for payment of Project
Costs and shall not include the Construction Loan, the Residential Loan, the Commercial Loan,
or any other borrowed funds, and shall include the Deferred Developer Fee and the Limited
Partner Capital Contribution, as well as any other funds of the Developer.
“Developer Fee” means the fee paid to Developer’s Managing General Partner, or an
Affiliate thereof, for development services with respect to the development of the Project, in the
amount set forth in the final approved Project Budget, the payment of which may be made in
partial payments at the Construction Financing Event, Completion of the Project and/or upon the
Conversion Date, but some or all of which may be deferred and payable as an Operating
Expense.
“Disbursement Agreement” shall mean an agreement setting forth the timing and
conditions of the disbursement of Project funds, which shall be entered into at the Construction
Financing Event in a form that is mutually acceptable to the Agency, the Developer and the
Construction Lender.
“Effective Date” shall mean the date this Agreement is executed by the Agency.
“Eligible Tenant” shall mean any person entitled to rent a Very Low Income Unit, a
Low Income Unit or a Moderate Income Unit as set forth in the Agreement Containing
Covenants.
“Environmental Indemnity” shall mean the indemnity by Developer, substantially in
the form attached hereto as Exhibit No. “15”, which is incorporated herein by this reference.
“Escrow” shall mean the escrow established with the Escrow Agent for the conveyance
of the Agency Parcel and the Construction Financing Event.
“Escrow Agent” shall mean Lawyers Title, or another escrow company mutually
acceptable to the Agency and the Developer.
“Executive Order” shall mean Executive Order No. 13224 on Terrorist Financing,
effective September 23, 2001, including the Annex thereto, as amended from time to time.
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“Force Majeure” or “Force Majeure Event” shall mean the following events, provided
that they actually delay and interfere with the timely performance of the matter to which it would
apply and despite the exercise of diligence and good business practices are or would be beyond
the reasonable control of the party claiming such interference: war; insurrection; strikes; lock-
outs; 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 including litigation challenging the validity of this transaction or
any element thereof; unusually severe weather; inability to secure necessary labor, materials or
tools; delays of any contractor, subcontractor, or suppliers; acts of the other party; acts or failure
to act of any Governmental Agency (except ministerial acts or failure to act of the Agency shall
not excuse performance by the Agency or the City, provided that all conditions to such actions
have been satisfied or waived); the imposition of any applicable moratorium by a Governmental
Agency; or any other causes which despite the exercise of diligence and good business practices
are or would be beyond the reasonable control of the party claiming such delay and interference.
Notwithstanding the foregoing, none of the foregoing events shall constitute a Force Majeure
Event unless and until the party claiming such delay and interference delivers to the other party
written notice describing the event, its cause, when and how such party obtained knowledge, the
date the event commenced, and the estimated delay resulting therefrom. Any party claiming a
Force Majeure Delay shall deliver such written notice within ten (10) business days after it
obtains actual knowledge of the event.
“Force Majeure Delay” shall mean any delay in taking any action required by this DDA,
proximately caused by the occurrence of any Force Majeure Event.
“Governmental Approvals” shall mean and include any and all general plan
amendments, zoning approvals or changes, required approvals and certifications under the
California Environmental Quality Act, tentative and final tract maps, variances, conditional use
permits, demolition permits, excavation/foundation permits, grading permits, building permits,
inspection reports and approvals, certificates of occupancy, and other approvals, permits,
certificates, authorizations, consents, orders, entitlements, filings or registrations, and actions of
any nature whatsoever required from any Governmental Agency in order to commence and
complete the Project.
“Governmental Agency” means the United States, the State of California, the County of
Los Angeles, the City of Culver City or any other political subdivision in which the Site is
located, and any court or political subdivision, agency or instrumentality having jurisdiction over
the Site.
“Grant Deed” shall mean that certain Grant Deed conveying the Agency Parcel to the
Developer, substantially in the form attached hereto as Exhibit No. “7.”
“Hazardous Substances” shall have the meaning set forth in the Environmental
Indemnity.
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“Improvements” shall mean the improvements to be developed on the Site in accordance
with this DDA, including but not limited to the Scope of Development.
“Investor Limited Partner” shall mean the entity, or any successor thereof, that will
provide the Limited Partner Capital Contribution set forth in the Method of Financing and
identified in the Limited Partnership Agreement.
“Land Lender” shall mean the Low Income Investment Fund.
“Land Loan” shall mean a loan of acquisition funds from the Land Lender to Developer
to pay Developer’s cost of acquiring the Developer Parcel, which loan will be repaid in full at the
Construction Financing Event.
“Lease” means the lease entered into between Developer and an Eligible Tenant of a
Affordable Unit in the Project.
“Limited Partner Capital Contribution” shall mean and refer to the Developer Equity
derived from the syndication of the Nine Percent Tax Credits, in the form of the initial Limited
Partner Capital Contribution and the additional Limited Partner Capital Contribution in the
estimated amounts set forth in the Method of Financing (including that portion of the Limited
Partner Capital Contribution that will be funded upon receipt of Form(s) 8609).
“Limited Partnership” shall mean the single purpose entity referred to herein as
“Developer”, formed for the ownership, development and operation of the Project and the
syndication of the Nine Percent Tax Credit.
“Limited Partnership Agreement” shall mean the agreement governing the Limited
Partnership and shall include the Limited Partnership Agreement as amended and restated on the
admission of the Investor Limited Partner.
“Limited Partnership Documents” shall mean all of those documents required to create
the Limited Partnership and to obtain the Nine Percent Tax Credit investment, including but not
limited to, the Limited Partnership Agreement as amended and restated on the admission of the
Investor Limited Partner, and the Guaranty Agreements.
“Low Income Household” shall have the meaning given to “lower income household” in
Health and Safety Code section 50079.5(a), generally being a household whose income does not
exceed 80% of the Area Median Income adjusted for family size.
“Low Income Units” shall mean the four (4) two-bedroom and two (2) three-bedroom
rental dwelling units in the Project restricted to occupancy by Low Income Households. The
term “Low Income Unit” shall mean each of the Low Income Units.
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“Managing General Partner” shall mean LOS ANGELES HOUSING PARTNERSHIP,
INC., a California non-profit public benefit corporation, unless and until removed or replaced
with another nonprofit (or limited liability company with a nonprofit as its sole member or
Special Limited Partner) reasonably acceptable to the Agency, pursuant to the terms of this
Agreement and the Limited Partnership Agreement.
“Method of Financing” shall mean the Method of Financing attached hereto as Exhibit
No. “3”, which is incorporated herein by this reference.
“Moderate Income Household” shall mean a household whose income does not exceed
120% of Area Median Income adjusted for family size.
“Moderate Income Units” shall mean the seven (7) two-bedroom and five (5) three-
bedroom rental dwelling units in the Project restricted to occupancy by Moderate Income
Households. The term “Moderate Income Unit” shall mean each of the Moderate Income Units.
“Net Proceeds” shall mean the amount, if any, by which a refinancing exceeds the
amount needed to repay a Senior Loan in full and any unpaid Deferred Developer Fee, including
principal and interest, any early redemption or prepayment penalty, and customary and
reasonable fees and costs of the transaction.
“Nine Percent Tax Credit” shall mean the federal tax credit allocated to the Project by
the California Tax Credit Allocation Committee. “Nine Percent” refers to the applicable
percentage of the qualified basis for a building that is not federally subsidized, as provided in
Internal Revenue Code Section 42(b)(1).
“Notice of Affordability Restrictions” shall mean the notice required by Health &
Safety Code Section 33334.3(f) to be recorded against the Site, substantially in the form of
Exhibit No. “17” attached hereto.
“Off-Site Improvements” shall mean the off-site improvements included in the Project
and described the Scope of Development.
“Permanent Deed of Trust” shall mean the deed of trust securing the Permanent Loan.
“Permanent Financing Event” shall mean the point in time when all conditions
precedent to the funding of the Permanent Loan have been satisfied.
“Permanent Lender” shall mean JPMorgan Chase Bank, CCRC, Bank of America, or
another institutional lender approved by the Agency.
“Permanent Loan” shall mean a loan from the Permanent Lender to repay the
Construction Loan, in the amount set forth in the final approved Project Budget.
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“Permanent Loan Documents” shall mean, in addition to the Permanent Deed of Trust,
a loan agreement, promissory note, financing statement, guaranties, and similar documents and
instruments to be executed by Developer in connection with the Permanent Loan.
“Permitted Transfer” shall mean any Transfer that is approved by the Agency or
expressly permitted by the terms of this DDA.
“Person” shall mean an individual, partnership, limited partnership, trust, estate,
association, corporation, limited liability company or other entity, domestic or foreign.
“Plans” shall mean any architectural and construction plans and drawings prepared on
behalf of Developer for the Project in accordance with this DDA.
“Prohibited Person” shall mean any of the following:
(a) a person or entity that is listed in the Annex to, or is otherwise subject to the
provisions of, the Executive Order;
(b) a person or entity owned or controlled by, or acting for or on behalf of, any person or
entity that is listed in the Annex to, or is otherwise subject to the provisions of, the Executive
Order;
(c) a person or entity with whom Developer or Investor Limited Partner is prohibited
from dealing or otherwise engaging in any transaction by any Anti-Terrorism Law;
(d) a person or entity who or that commits, threatens, or conspires to commit or supports
“terrorism,” as defined in the Executive Order; or
(e) a person or entity that is named as a “specially designated national and blocked
person” on the most current list published by the Office of Foreign Asset Control of the U.S.
Treasury Department at its official web site or any replacement website or other replacement
official publication of such list.
“Project” shall mean generally the development on the Site of 33 residential Units
(including one manager’s unit) and approximately 10,700 square feet of ground floor retail,
office, and community space, and the subsequent rental of the 14 Very Low Income Units, the 6
Low Income Units and the 12 Moderate Income Units to Eligible Tenants, all at Affordable Rent
for a period of not less than 55 years, pursuant to the procedures set forth herein and as more
particularly described in the Scope of Development and Agreement Containing Covenants.
“Project Budget” shall mean the sources and uses of funds for acquisition of the Site
and development of the Project as set forth in Exhibit No. “6.” The Project Budget and
Developer’s proposed method of financing shall be subject to change from time-to-time, subject
to the prior written approval of Developer and the Agency Executive Director (or designee) and
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subject to and conditioned on such further review and approval by the Agency’s governing board
as is needed to satisfy applicable law, policies and procedures, upon which approval the Project
Budget shall be replaced by the approved revised Project Budget.
“Project Costs” shall mean all costs which are actually incurred by Developer for the
development of the Project, and shall include, without limitation, all of the items of cost set forth
in the Project Budget and similar costs, fees and expenses as approved by the Agency, but not
including Residential Operating Costs and Commercial Operating Costs.
“Purchase Price” shall mean the Developer’s purchase price for the Agency Parcel set
forth in Section 301 of this Agreement.
“Release of Construction Covenants” shall have the meaning set forth in Section 418 of
this DDA.
“Relocation Consultant” shall mean Overland, Pacific & Cutler, Inc. or another
relocation consultant approved by the Agency in its sole discretion.
“Residential Deed of Trust” shall mean the Deed of Trust with Assignment of Rents
attached as Exhibit No. “9” hereto, in which Developer is the Trustor and the Agency is the
Beneficiary, which secures the Residential Loan.
“Residential Loan” shall mean the Agency’s loan to Developer in an amount not to
exceed ELEVEN MILLION EIGHT HUNDRED FIVE THOUSAND DOLLARS
($11,805,000.00) of Set Aside Funds, as evidenced by the Residential Note and secured by the
Residential Deed of Trust.
“Residential Loan Documents” shall mean the Residential Note, the Residential Deed
of Trust, the Assignment of Rents, the Assignment of Agreements, and the Environmental
Indemnity.
“Residential Note” shall mean that certain Promissory Note evidencing the Residential
Loan, substantially in the form attached hereto as Exhibit No. “8.”
“Residential Operating Costs” shall have the same meaning as the definition of Annual
Residential Operating Expenses set forth in the Residential Note.
“Restricted Period” shall mean the period beginning on the recordation of the
Agreement Containing Covenants and continuing until the date that is fifty-five (55) years after
the Conversion Date.
“Restricted Units” shall mean the Affordable Units.
“Right of Reentry” shall have the meaning given to it in Section 610 of this Agreement.
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“Schedule of Performance” shall mean that certain schedule attached hereto as Exhibit
No. “4”, setting forth the times upon which performance by the parties under this DDA is due.
“Scope of Development” shall mean that certain exhibit attached hereto as Exhibit No.
“5.”
“Senior Deed of Trust” shall mean, individually and collectively, the Construction Deed
of Trust and the Permanent Deed of Trust.
“Senior Lender” shall mean, individually and collectively, the Construction Lender and
the Permanent Lender.
“Senior Loan” shall mean, individually and collectively, the Construction Loan and the
Permanent Loan.
“Senior Loan Documents” shall mean, individually and collectively, the Construction
Loan Documents and the Permanent Loan Documents.
“Set Aside Funds” shall mean and be limited to that portion of the Agency’s general
property tax increment allocation set aside pursuant to CRL Section 33334.2 for the purposes of
increasing, providing and preserving the community’s supply of low and moderate income
housing available at an affordable housing cost to persons and families of low or moderate
income.
“Site” shall mean that certain real property located in the City of Culver City, County of
Los Angeles, State of California, commonly known as 11042-11056 West Washington
Boulevard, Culver City, California, and legally described in Exhibit No. “1-C” and depicted on
the Site Map attached hereto as Exhibit No. “2”.
“Special Limited Partner” shall mean the entity, if any, identified as the Special
Limited Partner in the Limited Partnership Agreement as amended upon admission of the
Investor Limited Partner.
“Subordination Agreement” shall mean an agreement to be entered into at the
Construction Financing Event, subordinating the Residential Loan Documents (which do not
include the Agreement Containing Covenants) and the Commercial Loan Documents to the
Senior Loan Documents, in a form that is acceptable to the Agency in its sole discretion.
“Title Company” shall mean Lawyers Title, or another title insurance company mutually
acceptable to Agency and Developer.
“Transfer” shall mean:
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(i) the sale, agreement to sell, transfer or conveyance of the Site, the Project, or
any portion thereof or interest therein, whether voluntary, involuntary, by operation of law or
otherwise, the execution of any installment sale contract or similar instrument affecting all or a
portion of the Site or Project, the lease of all or substantially all of the Site or Project, except as
provided in subparagraph (iii) below, or the appointment of a receiver or trustee to operate or
exercise direct or indirect control over any portion of or interest in the Project or to operate or
exercise direct or indirect control over any interest in any general partner or member of
Developer or any general partner or member of a general partner or member of Developer.
(ii) “Transfer” shall also include the transfer, assignment, hypothecation or
conveyance of legal or beneficial ownership of any interest in Developer or any general partner
or member of Developer or of any general partner or member of a general partner or member of
Developer, or any conversion of Developer to an entity form other than that of Developer at the
time of execution of this Agreement, except that, a cumulative change in ownership interest of
any general partner of the Developer of forty-nine percent (49%) or less shall not be deemed a
“Transfer” for purposes of this Agreement.
(iii) Notwithstanding paragraphs (i) and (ii), “Transfer” shall not include any of
the following Permitted Transfers:
(A) a conveyance of a security interest to the beneficiary of the Senior
Deed of Trust or the conveyance of title to the Site or Project in connection with a foreclosure, a
deed in lieu of foreclosure or similar conversion of such loan;
(B) (1) A conveyance of the Project to a limited partnership in which
the Managing General Partner is Developer or Developer’s Managing General Partner, or a sale
back from such partnership to Developer or such Managing General Partner.
(2) The substitution of a General Partner as directed by the
Investor Limited Partner in accordance with the terms of the Limited Partnership Agreement,
subject to the following terms and conditions. The Investor Limited Partner may substitute the
Special Limited Partner (or another reasonably acceptable Affiliate of Investor Limited Partner)
(the “Interim General Partner”) on an interim basis for a period reasonably calculated to identify
and admit into the partnership a new General Partner, as set forth below (the “Substitute General
Partner”). The Substitute General Partner must be an entity reasonably acceptable to the Agency,
which approval shall not be unreasonably withheld or delayed.
(C) Any refinancing that repays any of the Senior Loan (referred to herein
as a “Take-out Loan”), if (i) the Agency reasonably determines (which determination shall not be
unreasonably withheld) that the resulting loan-to-value ratio (including the Take-out Loan and
any of the remaining Senior Loan not repaid by the refinancing) will not exceed the loan-to-
value ratio of those loans in effect at the time of the Permanent Financing Event for the initial
development of the Project, and the repayment terms of the Take-out Loan do not materially
impair the Developer’s ability to repay the Residential Loan or (ii) the Take-out Loan is
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replacing a matured Senior Loan and the amount of the Take-out Loan is equal to, or less than,
the amount owing on the matured Senior Loan.
(D) The leasing for occupancy of all or any part of the Site or Project in
accordance with this Agreement and the Agreement Containing Covenants.
(E) The inclusion of equity participation by Developer by transfer or
addition of limited partners to the Developer or similar mechanism; provided that such transfer,
addition or other mechanism shall not involve any Prohibited Person or otherwise result in a
violation of Anti-Terrorism Laws.
(F) The pledge by a General Partner to the Investor Limited Partner or the
Special Limited Partner of the General Partner’s interest in the Developer, as security for the
performance of all of the General Partner’s obligations under the Limited Partnership
Agreement.
(G) The sale, transfer or pledge of any limited partnership interest in the
Developer or of any partnership interest in the Investor Limited Partner; provided that such sale,
transfer or pledge shall not be to any Prohibited Person or otherwise result in a violation of Anti-
Terrorism Laws.
(H) Any dilution of the General Partner’s interest in the Developer in
accordance with the Limited Partnership Agreement.
“UCC1 Financing Statement” shall mean the financing statement(s) to be filed with the
California Secretary of State’s Office at the Construction Financing Event in connection with the
Agency Loan. The Developer hereby consents to the filing of the UCC1 Financing Statement.
“Units” shall mean the commercial units and the thirty-three (33) dwelling units,
including one manager’s unit, comprising the Project.
“USA Patriot Act” shall mean the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Pub. L. No. 107-
56, 115 Stat. 272 (2001), as amended from time to time.
“Very Low Income Household” shall have the meaning given in California Health and
Safety Code section 50105(a).
“Very Low Income Units” shall mean the two (2) one-bedroom, seven (7) two-bedroom
and five (5) three-bedroom rental dwelling units in the Project restricted to occupancy by Very
Low Income Households. The term “Very Low Income Unit” shall mean each of the Very Low
Income Units.
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ARTICLE II SUBJECT OF THIS AGREEMENT
Section 201 Purpose of Agreement
(a) The purpose of this DDA is to promote affordable housing by conveying the
Agency Parcel to the Developer and providing the Residential Loan in an amount equal to
ELEVEN MILLION EIGHT HUNDRED FIVE THOUSAND DOLLARS ($11,805,000), as
evidenced by the Residential Note secured by the Residential Deed of Trust, and the Commercial
Loan in the amount of THREE MILLION THREE HUNDRED NINETY FIVE THOUSAND
DOLLARS ($3,395,000), as evidenced by the Commercial Note secured by the Commercial
Deed of Trust, to assist Developer in the acquisition of the Site and the construction and
operation of affordable housing in the City of Culver City.
(b) This DDA is intended to facilitate Developer’s acquisition of the Site and
construction of the Project and rental of the Affordable Units to Very Low Income, Low Income
and Moderate Income Households for a period of not less than 55 years. The Project pursuant to
this DDA and the fulfillment generally of this DDA are in the vital and best interests of the
Agency and the City and the health, safety welfare of the City’s residents, and are in accordance
with the public purposes and provisions of applicable federal, state, and local laws and
requirements under which the Project has been undertaken and is being assisted.
Section 202 The Redevelopment Plan
(a) The purpose of this Agreement is to implement the Community Redevelopment
Law of the State of California (California Health and Safety Code Sections 33000 et seq.) (the
“CRL”) and the Redevelopment Plan (“Redevelopment Plan”) for the Culver City
Redevelopment Project (“Project Area”) by increasing, improving and preserving the supply of
low and moderate income housing in the community. The Agency intends this DDA to meet its
obligations pursuant to Health and Safety Code Sections 33413, 33334.2 and, if applicable,
33413(b)(2)(A)(ii).
(b) This Agreement is subject to the provisions of the Redevelopment Plan, which
was approved and adopted pursuant to Ordinance No. 98-014 on November 23, 1998 and
amended pursuant to Ordinance No. 98-015 on November 23, 1998 to add Component Area No.
4, and lawfully amended thereafter. The Redevelopment Plan is incorporated herein by
reference and made a part hereof as though fully set forth herein. The proposed Project is
consistent with the Redevelopment Plan.
(c) Any amendments hereafter to the Redevelopment Plan (as so approved and
adopted) which change the uses or development permitted on the Site as proposed in this
Agreement, or otherwise change the restrictions or controls that apply to the Site, or otherwise
affect the Developer’s obligations or rights with respect to the Site, shall require the written
consent of the Developer. Amendments to the Redevelopment Plan, applying to property in the
Culver City Redevelopment Project Area that is not the subject of this Agreement or otherwise
not materially affecting the Developer's rights and obligations under this DDA, shall not require
the consent of the Developer.
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Section 203 The Redevelopment Project Area
The Culver City Redevelopment Project area (“Project Area”) is located in the City of
Culver City. The exact boundaries of the Project Area are specifically and legally described in
the Redevelopment Plan.
Section 204 The Site
The “Site” consists of the Agency Parcel located at 11054-11056 West Washington
Boulevard and legally described in Exhibit No. 1-B and the Developer Parcel located at 11042-
11052 West Washington Boulevard and legally described in Exhibit No. 1-A. The Site is legally
described in Exhibit No. 1-C and is illustrated and designated on the “Site Map,” which is
incorporated herein and attached hereto as Exhibit No. 2. Agency is fee owner of the Agency
Parcel. This Agreement sets forth the terms and conditions by which Agency will convey the
Agency Parcel to the Developer and the Developer will develop and use the Site.
Section 205 Parties to the Agreement
(a) 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. The principal office of the Agency is located at 9770 Culver
Boulevard, Culver City, California 90232-0507. “Agency” as used in this Agreement includes
the Culver City Redevelopment Agency and any assignee of or successor to its rights, powers
and responsibilities.
(b) The City
The City is a charter city of the State of California. The principal office of the City is
located at 9770 Culver Boulevard, Culver City, California 90232-0507. “City” as used in this
Agreement includes the City of Culver City and any assignee of or successor to its rights, powers
and responsibilities.
(c) The Developer
The Developer is TILDEN TERRACE, L.P., a California limited partnership, whose
address is 1200 Wilshire Boulevard, Suite 307
Los Angeles, California 90017. The Managing General Partner of the Developer is LOS
ANGELES HOUSING PARTNERSHIP, INC., a California non-profit public benefit
corporation. Wherever the term “Developer” is used herein, such term shall include any
permitted nominee, assignee or successor in interest as herein provided.
Section 206 Prohibition Against Transfers; Right of First Refusal
(a) The qualifications and identity of the Developer are of particular concern to the
Agency. It is because of those qualifications and identity that the Agency has entered into this
Agreement with the Developer. No voluntary or involuntary successor in interest of the
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Developer shall acquire any rights or powers under this Agreement except as expressly set forth
herein.
(b) Developer agrees that, except for a Permitted Transfer, Developer shall not sell
the Site during the term of the Agreement Containing Covenants, unless and until Developer has
given to the Agency notice in writing of its intent to sell, specifying the identity of the
prospective buyer and the price and terms of the contemplated sale. Within ninety (90) days
after Developer gives the Agency written notice of Developer’s intent to sell, the Agency shall
have the right to purchase the Site at the same price and on the same terms and conditions set
forth in Developer’s written notice of intent to sell. To exercise this right, the Agency must,
within the same ninety (90) day period, deposit in escrow with any escrow company in Los
Angeles County, California, all moneys and instruments required by the terms of the Developer’s
notice of intent to sell to be paid or delivered to Developer on close of escrow and shall also give
Developer written notice of the deposit. If the Agency does not exercise the right in accordance
with the provisions of this Section, Developer may sell the Site to the prospective buyer for the
price and on the terms contained in the notice; provided, however, that Developer has made
every reasonable effort to sell the Site to another nonprofit housing corporation with Developer’s
similar experience and reputation in the field of low-income housing (including the management
of properties with income and affordability restrictions), and provided further that the Agency
has reasonably approved such prospective buyer in advance in writing.
(c) If at any time during the term of the Agreement Containing Covenants, Developer
receives from any third party a bona fide offer to purchase the Site on terms acceptable to
Developer and the Developer desires to sell the Site pursuant to said offer or a counter-offer from
Developer, then Developer shall give written notice of the offer to the Agency. Within ninety
(90) days after Developer gives the Agency written notice of the third-party offer, the Agency
shall have the right to purchase the Site at the same price and on the same terms and conditions
set forth in the third-party offer. To exercise its right, the Agency must, within the same ninety
(90) day period, deposit in escrow with any escrow company in Los Angeles County, California,
all moneys and instruments required by the terms of the offer to be paid or delivered to
Developer on close of escrow and shall also give Developer written notice of the deposit. If the
Agency does not exercise its right to purchase in accordance with the provisions of this Section,
Developer may sell the Site to the third party making the offer on the same terms and conditions
set forth in that offer; provided, however, that Developer has made every reasonable effort to sell
the Site to another nonprofit housing corporation with Developer’s similar experience and
reputation in the field of low-income housing (including the management of properties with
income and affordability restrictions), and provided further that the Agency has reasonably
approved such prospective buyer in advance in writing. If for any reason the Site is not sold to
the party making the offer, Developer shall give the Agency the same right to purchase the Site
on receiving any subsequent offer from any third party that is acceptable to Developer.
(d) For the reasons cited above, the Developer represents and agrees for itself and any
successor in interest that, except for changes necessitated by a Permitted Transfer, without the
prior written approval of the Agency (not to be unreasonably withheld, conditioned or delayed),
there shall be no significant change in the ownership of the Developer or in the relative
proportions thereof, or with respect to the identity of the parties in control of the Developer or
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the degree thereof, by any method or means, except that periodic, routine changes in board
membership (not including changes resulting from annual elections or the death or incapacity of
an individual) that cumulatively over the course of a calendar year affect less than 50% of the
membership of the board shall not be considered a “significant change”.
(e) The Developer shall promptly notify the Agency of any and all changes
whatsoever in the identity of the parties in ownership and/or in control of the Developer or the
degree thereof, of which it or any of its officers have been notified or otherwise have knowledge
or information. This Agreement may be terminated by the the Agency and the Agency may
exercise any and all available remedies if there is any significant change (voluntary or
involuntary) in membership, ownership, management or control, of the Developer or any general
partner of the Developer (other than such changes occasioned by the death or incapacity of any
individual or necessitated by a Permitted Transfer) without the prior written consent of the
Agency.
(f) Except with respect to a Permitted Transfer, Developer shall not assign or attempt
to assign this Agreement or any right herein, nor make any Transfer, without prior written
approval of the Agency Executive Director, except as expressly permitted by this Agreement.
Any proposed transferee shall have the qualifications and financial responsibility necessary and
adequate as may be reasonably determined by the Agency to fulfill the obligations undertaken in
this Agreement by the Developer. Any such proposed transferee, by instrument in writing
satisfactory to the Agency and in form recordable among the land records, for itself and its
successors and assigns, and for the benefit of the Agency shall expressly assume all of the
obligations of the Developer under this Agreement and agree to be subject to all conditions and
restrictions applicable to the Developer in this Agreement. There shall be submitted to the
Agency for review all instruments and other legal documents proposed to affect any such
Transfer, and if approved by the Agency, its approval shall be indicated to the Developer in
writing.
(g) In the absence of specific written agreement by the Agency, no Transfer, or
approval thereof by the Agency, shall be deemed to relieve the Developer or any other party
from any obligations under this Agreement.
(h) Consent to any Transfer shall not be deemed to be a waiver of the right to require
consent to future or successive Transfers.
(i) Upon expiration of the term of the Agreement Containing Covenants, the
provisions of this Section 206 shall be of no further force or effect.
ARTICLE III DISPOSITION OF THE AGENCY PARCEL
Section 301 Sale and Purchase
(a) In accordance with and subject to all the terms, covenants, and conditions of this
Agreement, the Agency agrees to sell to the Developer and the Developer agrees to purchase the
Agency Parcel as shown on the Site Map (Exhibit No. 2) and as more precisely described in the
Legal Description (Exhibit No. 1-B).
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(b) The Developer shall pay to the Agency as the total purchase price for the Agency
Parcel, THREE MILLION FOUR HUNDRED THOUSAND DOLLARS ($3,400,000.00) (the
“Purchase Price”). The Agency will fund the Developer’s payment of the Purchase Price through
the Residential Loan. The Developer shall execute a promissory note for the Residential Loan
(which will be used for payment of Acquisition Costs and other Project Costs) substantially in
the form of the Residential Note attached hereto as Exhibit No. 8, which is incorporated by this
reference. The Residential Note will be secured by a deed of trust to be recorded against the Site,
substantially in the form of the Residential Deed of Trust attached hereto as Exhibit No. 8, which
is incorporated by this reference.
Section 302 Condition of Title
(a) The Agency shall convey to the Developer fee simple merchantable title to the
Agency Parcel free and clear of all liens, encumbrances, assessments, easements, leases and
taxes; except those which are set forth in this Agreement and included in the Grant Deed, and
those which are otherwise consistent with this Agreement and which are acceptable to the
Developer.
(b) Title to the Agency Parcel shall be conveyed to the Developer free of any
possession or right of possession, except to the extent waived by Developer in writing.
Section 303 Condition of the Agency Parcel
DEVELOPER SPECIFICALLY ACKNOWLEDGES AND AGREES THAT EXCEPT
AS OTHERWISE EXPRESSLY PROVIDED HEREIN, THE AGENCY IS SELLING AND
DEVELOPER IS PURCHASING THE AGENCY PARCEL ON AN “AS IS WITH ALL
FAULTS” BASIS AND THAT DEVELOPER IS NOT RELYING ON ANY
REPRESENTATIONS OR WARRANTIES OF ANY KIND WHATSOEVER, EXPRESS OR
IMPLIED, FROM THE AGENCY, ITS INDIVIDUAL MEMBERS, AGENTS, ATTORNEYS
OR BROKERS AS TO ANY MATTERS CONCERNING THE AGENCY PARCEL,
INCLUDING WITHOUT LIMITATION: (A) THE QUALITY, NATURE, ADEQUACY, AND
PHYSICAL CONDITION OF SOILS, GEOLOGY AND ANY GROUNDWATER; (B) THE
EXISTENCE, QUALITY, NATURE, ADEQUACY AND PHYSICAL CONDITION OF
UTILITIES SERVING THE AGENCY PARCEL; (C) THE DEVELOPMENT POTENTIAL OF
THE AGENCY PARCEL, AND THE AGENCY PARCEL’S USE, MERCHANTABILITY, OR
FITNESS, OR THE SUITABILITY, VALUE OR ADEQUACY OF THE AGENCY PARCEL
FOR ANY PARTICULAR PURPOSE; (D) THE ZONING OR OTHER LEGAL STATUS OF
THE AGENCY PARCEL OR ANY OTHER PUBLIC OR PRIVATE RESTRICTIONS ON
USE OF THE AGENCY PARCEL; (E) THE COMPLIANCE OF THE AGENCY PARCEL
WITH ANY APPLICABLE CODES, LAWS, REGULATIONS, STATUTES, ORDINANCES,
COVENANTS, CONDITIONS AND RESTRICTIONS OF ANY GOVERNMENTAL OR
QUASI-GOVERNMENTAL ENTITY OR OF ANY OTHER PERSON OR ENTITY; (F) THE
PRESENCE OF “HAZARDOUS SUBSTANCES” (AS DEFINED IN SECTION 304, BELOW)
ON, UNDER OR ABOUT THE AGENCY PARCEL OR THE ADJOINING OR
NEIGHBORING LAND AND IMPROVEMENTS; (G) THE QUALITY OF ANY LABOR
AND MATERIALS USED IN ANY IMPROVEMENTS; AND (H) THE CONDITION OF
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TITLE TO THE AGENCY PARCEL. OTHER THAN THE EXPRESS REPRESENTATIONS
AND WARRANTIES SET FORTH IN THIS AGREEMENT AND THE GRANT DEED,
DEVELOPER HEREBY EXPRESSLY ACKNOWLEDGES AND AGREES THAT
DEVELOPER IS RELYING SOLELY UPON ITS INSPECTIONS, EXAMINATION, AND
EVALUATION OF THE AGENCY PARCEL IN PURCHASING THE AGENCY PARCEL
ON AN “AS IS,” “WHERE IS” AND “WITH ALL FAULTS” BASIS.
If the condition of the Agency Parcel upon its purchase by Developer is not in all respects
entirely suitable for the use or uses contemplated by this Agreement, then it is the sole
responsibility and obligation of Developer to place the Agency Parcel in all respects in a
condition entirely suitable for the development thereof, solely at Developer’s expense.
Section 304 Hazardous Substances
(a) “Hazardous Substance,” as used in this Agreement means any substance, material
or waste which is or becomes regulated by the United States government, the State of California,
or any local or other governmental authority, including, without limitation, any material,
substance or waste which is (i) defined as a “hazardous waste,” “acutely hazardous waste,”
“restricted hazardous waste,” or “extremely hazardous waste” under Sections 25115, 25117 or
25122.7, or listed pursuant to Section 25140, of the California Health and Safety Code; (ii)
defined as a “hazardous substance” under Section 25316 of the California Health and Safety
Code; (iii) defined as a “hazardous material,” “hazardous substance,” or “hazardous waste”
under Section 25501 of the California Health and Safety Code; (iv) defined as a “hazardous
substance” under Section 25281 of the California Health and Safety Code; (v) petroleum; (vi)
asbestos; (vii) a polychlorinated biphenyl; (viii) listed under Article 9 or defined as “hazardous”
or “extremely hazardous” pursuant to Article 11 of Title 22 of the California Code of
Regulations, Chapter 20; (ix) designated as a “hazardous substance” pursuant to Section 311 of
the Clean Water Act (33 U.S.C. Section 1317); (x) defined as a “hazardous waste” pursuant to
Section 1004 of the Resource Conservation and Recovery Act (42 U.S.C. Section 6903); (xi)
defined as a “hazardous substance” pursuant to Section 101 of the Comprehensive
Environmental Response, Compensation and Liability Act (42 U.S.C. Section 9601); or (xii) any
other substance, whether in the form of a solid, liquid, gas or any other form whatsoever, which
by any governmental requirements is defined as “hazardous” or is harmful to the environment or
capable of posing a risk of injury to public health and safety. “Hazardous Substances” do not
include materials customarily used in the construction, development, operation or maintenance
of real estate, provided such substances are used in accordance with all laws.
(b) Developer hereby represents and warrants that the development, construction and
uses of the Agency Parcel permitted under this Agreement shall comply in all material respects
with all applicable environmental laws.
(c) Effective upon the close of escrow, Developer agrees to indemnify, defend and
hold harmless Agency and City and their respective members, officers, agents, employees,
contractors and consultants, in accordance with the Environmental Indemnity, which is
incorporated herein and attached hereto as Exhibit No. “15”.
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(d) By execution of this Agreement and except as to any action, demand, or claim by
a third party, raised or asserted prior to close of escrow, including a governmental agency,
relating to “Pre-Existing Hazardous Materials” (as defined in the Environmental Indemnity),
Developer hereby waives, releases and discharges the Agency, the City, and their respective
members, officers, employees, agents, contractors and consultants, from any and all present and
future claims, demands, suits, legal and administrative proceedings, and from all liability for
damages, losses, costs, liabilities, fees and expenses (including, without limitation, attorneys’
fees) arising out of or in any way connected with the Agency’s or Developer’s use, maintenance,
ownership or operation of the Agency Parcel, any Hazardous Substances on the Agency Parcel,
or the existence of Hazardous Substances contamination in any state on the Agency Parcel,
however the Hazardous Substances came to be placed there, except that arising out of the
negligence or willful misconduct of the Agency or its employees, officers or agents. Developer
acknowledges that it is aware of and familiar with the provisions of Section 1542 of the
California Civil Code 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 his settlement with the debtor.”
To the extent of the release set forth in this Section 304, Developer hereby waives and
relinquishes all rights and benefits which it may have under Section 1542 of the California Civil
Code.
Section 305 Developer’s Due Diligence
(a) Developer shall have up to ninety (90) days after the Agency’s execution of this
Agreement (the “Due Diligence Period”) to inspect the Agency Parcel, in accordance with the
terms and conditions of the License Agreement between Developer and the Agency dated on or
about December 16, 2010. Upon the Agency’s execution of this Agreement, it shall extend the
term of the License Agreement for the Due Diligence Period.
(b) If the Developer finds the Agency Parcel unsatisfactory for any reason during the
Due Diligence Period, Developer shall notify the Agency and Escrow Agent, in writing, prior to
expiration of the Due Diligence Period. Developer’s failure to notify Agency of its decision to
terminate escrow will be deemed to be Developer’s approval of the Agency Parcel and decision
to proceed to the close of escrow. If Developer elects to terminate the escrow, then Developer
and Agency shall thereafter have no obligation to each other (except as otherwise set forth
herein), Developer will deliver to the Agency, without representation or warranty, a copy of all
reports and studies commissioned or prepared by Developer (other than internal financial
analyses and/or financial projections prepared by Developer and matters considered attorney
work product). In the event of a cancellation of escrow, Developer and the Agency shall each
pay one-half of any escrow cancellation fees.
Section 306 Survey
Developer may obtain a survey of the Site prepared by a land surveyor duly licensed by
the State of California and in compliance with ALTA/ACSM standards (“Survey”) or an update
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to an existing Survey prepared for or on behalf of Agency, in a form acceptable to the Title
Company for the deletion of the standard survey exception in the Title Policy relating to
boundaries, without the addition of further exceptions unless the same are acceptable to
Developer. Developer shall have until the end of the Due Diligence Period to examine the
Survey and to notify Agency in writing of any objections Developer has to the Survey
(“Developer’s Survey Objection Notice”). Provided that Agency has received a copy of the
Survey concurrently with the Developer’s receipt of the Survey, Agency shall have a period of
ten (10) days after receipt of Developer’s Survey Objection Notice in which to deliver written
notice to Developer (“Agency’s Survey Notice”) of Agency’s election to either (1) agree to
remove the objectionable items prior to the Close of Escrow or (2) decline to remove such items
and terminate the Escrow. If Agency notifies Developer of its intention to not remove the
objectionable items, Developer shall have the right, by written notice delivered to Agency within
five (5) days after Developer’s receipt of Agency’s Survey Notice, to agree to accept the Agency
Parcel subject to the objectionable items, in which event, Agency’s election to terminate the
Escrow shall be of no effect, and Developer shall accept the Agency Parcel on the Close of
Escrow subject to such objectionable items.
Section 307 Conditions to Close of Escrow
(a) Developer’s Conditions Precedent. Developer’s obligation to purchase the
Agency Parcel shall be conditioned upon the fulfillment of the following conditions precedent
prior to the Close of Escrow (unless otherwise provided):
1. Agency shall have duly performed each and every agreement to be
performed by Agency hereunder prior to the Close of Escrow and Agency’s representations,
warranties and covenants set forth in this Agreement shall be true and correct as of the date of
the close of Escrow.
2. The Title Company shall be committed to issue a standard ALTA form
owner’s title insurance policy to the Developer insuring that fee title to the Agency Parcel is
vested in Developer subject only to the matters described in Section 302 (the “Developer’s
Standard Title Insurance Policy”), or such other title insurance as Developer may request, but
Developer may not delay the Close of Escrow so long as the Title Company is prepared to issue
the Developer’s Standard Title Insurance Policy;
3. There shall not have occurred at any time on or before the date scheduled
for the Close of Escrow the making by Agency of any general assignment for the benefit of
creditors, or the filing against Agency of a petition to have Agency adjudged a bankrupt or a
petition for reorganization or arrangement under any law relating to bankruptcy, or the
appointment of a trustee or receiver to take possession of substantially all of the interest of
Agency in the Site, or the attachment, execution or judicial seizure of substantially all the assets
of Agency or the interests of Agency in the Agency Parcel or any legal proceeding in which
Agency is adjudicated as being, or stipulates to being, insolvent or unable to pay its debts as they
come due.
4. The Developer shall have reviewed and approved the Escrow Agent’s
estimated statement of closing costs.
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5. The Developer shall have determined, in its sole and absolute discretion,
that the construction and development of the Site and Project is financially feasible.
(b) Agency’s Conditions Precedent. Agency’s obligation to convey the Agency
Parcel to Developer shall be conditioned upon the fulfillment of the following conditions
precedent prior to the Close of Escrow (unless otherwise provided):
1. Developer shall have duly performed each and every agreement to be
performed by Developer hereunder prior to the Close of Escrow and Developer’s
representations, warranties and covenants set forth in this Agreement shall be true and correct as
of the date of the Close of Escrow.
2. Developer shall have satisfied all conditions precedent to the Construction
Financing Event (as provided in the Method of Financing).
3. The Title Company shall be committed to issue a standard ALTA form
Lender’s Title Insurance Policy to the Agency insuring Agency that the Residential Deed of
Trust is a valid lien encumbering the Site in the priority required by the Agency (the “Agency’s
Standard Title Insurance Policy”).
4. The Agency shall have reviewed and approved the Escrow Agent’s
estimated statement of closing costs.
Section 308 Escrow
(a) The Agency agrees to open an escrow for conveyance of the Agency Parcel with
the Escrow Agent, within the time provided in the Schedule of Performance. Section 204,
Section 205 and Article III of this Agreement shall constitute the joint escrow instructions of
the Agency and the Developer for the conveyance of the Agency Parcel, and a duplicate original
of this Agreement shall be delivered to the Escrow Agent upon the opening of the escrow. The
Agency and the Developer shall provide such additional escrow instructions consistent with this
Agreement as shall be necessary. The Escrow Agent hereby is empowered to act under such
instructions, and upon indicating its acceptance thereof in writing, delivered to the Agency and to
the Developer upon opening of the escrow, the Escrow Agent shall carry out its duties as Escrow
Agent hereunder. If there is any inconsistency between such additional instructions and this
Agreement, then this Agreement shall control.
(b) Upon delivery of the Grant Deed for the Agency Parcel to the Escrow Agent, the
Escrow Agent shall record such Grant Deed in accordance with these escrow instructions,
provided that the title to the Agency Parcel can be vested in the Developer in accordance with
the terms and provisions of this Agreement. The Escrow Agent shall buy, affix, and cancel any
transfer stamps required by law. Any insurance policies governing the Agency Parcel are not to
be transferred.
(c) The Developer shall pay in escrow to the Escrow Agent the following fees,
charges and costs for the conveyance of the Agency Parcel promptly after the Escrow Agent has
notified the Developer of the amount of such fees, charges and costs, at least two (2) working
days, but not earlier than ten (10) days, prior to the scheduled date for the conveyance of the
Agency Parcel:
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1. One-half of the escrow fee;
2. The premiums for any extended coverage or special endorsements which it
requests in addition to the Developer’s Standard Title Insurance Policy.
(d) The Agency shall pay the following fees, charges and costs for the conveyance of
the Agency Parcel:
1. One-half of the escrow fee;
2. Costs necessary to place the title to the Agency Parcel in the condition for
conveyance required by the provisions of this Agreement;
3. Cost of drawing the Grant Deed;
4. Recording fees;
5. Notary fees;
6. Any State, County, or City documentary stamps or transfer tax; and
7. The premium for Developer’s Standard Title Insurance Policy.
(e) The Agency shall timely and properly execute, acknowledge and deliver the Grant
Deed to the Escrow Agent, conveying to the Developer title to the Agency Parcel in accordance
with the requirements of this Agreement.
(f) The Escrow Agent is authorized to:
1. Pay, and charge the Agency and the Developer, respectively, for any fees,
charges and costs payable under this Agreement. Before such payments are made, the Escrow
Agent shall notify the Agency and the Developer of the fees, charges and costs necessary to clear
title and close the escrow.
2. Disburse funds and deliver the Grant Deed and other documents to the
parties entitled thereto when the conditions of this escrow have been fulfilled by the Agency and
the Developer.
3. Record any instruments delivered through this escrow if necessary or
proper to vest title in the Developer in accordance with the terms and provisions of the escrow
instructions portion of this Agreement.
(g) If this escrow is not in condition to close with respect to the Agency Parcel on or
before the time for conveyance established in the Schedule of Performance, either party who
then shall have fully performed the acts to be performed before the conveyance of title may, in
writing, demand the return of its money, papers, or documents from the Escrow Agent. No
demand for return shall be recognized until ten (10) days after the Escrow Agent (or the party
making such demand) shall have mailed copies of such demand to the other party or parties at
the address of its principal place of business. Objections, if any, shall be raised by written notice
to the Escrow Agent and to the other party within the 10-day period, in which event the Escrow
Agent is authorized to hold all money, papers, and documents with respect to the Agency Parcel
until instructed by a mutual agreement of the parties or, upon failure thereof, by a court of
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competent jurisdiction. If no such demands are made, the escrow shall be closed as soon as
possible.
(h) If objections are raised as above provided for, the Escrow Agent shall not be
obligated to return any such money, papers, or documents except upon the written instructions of
both the Agency and the Developer, or until the party entitled thereto has been determined by a
final decision of a court of competent jurisdiction. If no such objections are made within said
10-day period, the Escrow Agent shall immediately return the demanded money, papers, or
documents.
(i) Any amendment to the escrow instructions shall be in writing and signed by both
the Agency and the Developer. At the time of any amendment the Escrow Agent shall agree to
carry out its duties as Escrow Agent under such amendment.
(j) All communications from the Escrow Agent to the Agency or the Developer shall
be directed to the addresses and in the manner established in Section 702 of this Agreement for
notices, demands, and communications between the Agency and the Developer.
Section 309 Conveyance of Title and Delivery of Possession
(a) Subject to any mutually agreed upon extension of time, conveyance to the
Developer of title to the Agency Parcel in accordance with this Agreement shall be completed on
or prior to the date specified in the Schedule of Performance or such later date mutually agreed
to in writing by the Agency and the Developer and communicated in writing to the Escrow
Agent.
(b) Except as otherwise provided herein, possession of the Agency Parcel shall be
delivered to and accepted by the Developer concurrently with the conveyance of title.
Section 310 Form of Grant Deed
The Agency shall convey to the Developer title to the Agency Parcel in the condition
provided in Section 302 of this Agreement by “Grant Deed” in a form to be mutually agreed
upon by the Agency and the Developer consistent with this Agreement and substantially in the
form incorporated herein and attached hereto as Exhibit No. “7”. The Grant Deed to the Agency
Parcel shall contain covenants necessary or desirable to carry out the purposes of this Agreement
and shall include provisions to effectuate the Right of Reentry described in Section 610 of this
Agreement.
Section 311 Time For and Place For Delivery of Grant Deed
Subject to any mutually agreed upon extension of time, the Agency shall deposit the
Grant Deed for the Agency Parcel with the Escrow Agent on or before the date established for
the conveyance of the Agency Parcel in the Schedule of Performance.
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Section 312 Recordation of the Deed
After the Agency has notified the Escrow Agent that all conditions to conveyance of the
Agency Parcel have either been satisfied or waived, the Escrow Agent shall file the Grant Deed
for recordation in the Official Records of Los Angeles County.
Section 313 Title Insurance
Concurrently with recordation of the Grant Deed, the Title Company shall provide and
deliver to the Developer an ALTA extended coverage title insurance policy issued by Title
Company in the amount of the Purchase Price, insuring that title to the Agency Parcel is vested
in the Developer in the condition required by Section 302 of this Agreement.
The Developer shall pay for all premiums including those for any extended coverage or
special endorsements which it requests, in excess of the amount the Agency is required to
contribute pursuant to Section 308 above.
Section 314 Taxes and Assessments
Ad valorem taxes and assessments, if any, on the Agency Parcel, and taxes upon this
Agreement or any rights hereunder, levied, assessed or imposed for any period, commencing
after conveyance of title or possession of the Agency Parcel to the Developer, shall be borne by
the Developer. Ad valorem taxes and assessments levied, assessed or imposed for any period
prior to conveyance of title to the Agency Parcel to the Developer shall be paid by the Agency.
Section 315 Real Estate Commissions.
(a) Neither the Agency, the City nor the Developer shall be liable for any real estate
commissions or brokerage fees which may arise herefrom. The Agency, the City and the
Developer each represents it has not engaged a broker, agent or finder in connection with this
transaction (provided, however, Developer has engaged Kevin Smith of KANMCO as a broker
in connection with the Developer Parcel). The Developer agrees to defend, hold harmless and
indemnify the Agency and City from any claim by any broker, agent or finder retained, or
claimed to have been retained, by the Developer. The Agency agrees to defend, hold harmless
and indemnify the Developer from any claim by any broker, agent or finder retained, or claimed
to have been retained by the Agency.
ARTICLE IV DEVELOPMENT OF THE PROJECT
Section 401 Agency Assistance
(a) The total estimated cost of the Project is set forth in the Project Budget and
Method of Financing. This estimated cost includes the Acquisition Costs and the hard and soft
costs of constructing the Project. Developer shall use the Residential Loan and the Commercial
Loan for approved Project costs and Developer shall certify such use to the Agency upon
Completion, in a form reasonably acceptable to the Agency.
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(b) The Agency agrees that this Agreement, the Residential Loan Documents (which
do not include the Agreement Containing Covenants), and the Commercial Loan Documents
shall be made junior and subordinate to the Senior Loan Documents given in connection with the
Senior Loan, including any refinancing thereof established and obtained pursuant to and in
compliance with the provisions of this Agreement (as approved by the Agency to the fullest
extent required by this Agreement). The Executive Director of the Agency is hereby authorized
to execute such subordination agreements as may be reasonably requested by the Senior
Lender(s) to evidence subordination to the Senior Loans, without further authorization from the
Agency, provided that such agreements contain written provisions as are reasonably designed to
protect the Agency’s investment in the Project.
(c) Developer acknowledges that the Commercial Loan, the Residential Loan and all
Set Aside Funds expenditures are subject to all terms and conditions of the Agency, this
Agreement, and any other local, state or federal agency with jurisdiction over the source of these
funds and that the Project will be developed, constructed, and operated in accordance with the
City of Culver City’s standards and regulations and this Agreement. It is expressly understood
and agreed by the parties that this section does not limit the amount of costs that may be charged
or imposed by the City of Culver City for the Project or the Project approvals.
Section 402 Scope of Development
The Project shall be developed in accordance with and within the limitations established
in the Scope of Development and plans approved by the Agency pursuant to this DDA and
permits issued by the City of Culver City. It is anticipated that Developer will contract for
performance of specific activities, including but not limited to activities such as site inspections
and management of the Units. Such contracts shall not in any way diminish or waive
Developer’s obligations under this DDA.
Section 403 Project Construction Drawings and Related Documents
(a) Developer shall prepare and submit construction drawings and related documents,
including bid sets, for the development of the Project to the Agency for review (including, but
not limited to, architectural review) and written approval at the times established in the Schedule
of Performance. The construction drawings and related documents shall be submitted in two
stages, preliminary and final drawings, plans and specifications. Final drawings, plans, and
specifications are hereby defined as those in sufficient detail to obtain a building permit. Any
items so submitted and approved in writing by the Agency shall not be subject to subsequent
disapproval. Agency approval shall not be unreasonably withheld or delayed. The Developer
must obtain at least three competitive bids for the construction of the Project and the contract
amount must be determined on a “cost plus” basis with a predetermined “not to exceed” amount.
The bid set for the Project shall include deductive alternates for the Off-Site Improvements,
which shall be provided by the Agency. Developer shall instruct bidders to provide pricing for
the Off-Site Improvements and the deductive alternates independently from the pricing for the
balance of the Project. Developer shall submit the Project bids to the Agency and the Agency
shall designate which, if any, of the deductive alternates for the Off-Site Improvements shall be
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included in the construction contract for the Project, provided however, that the Agency shall
first consult with Developer to confirm that the inclusion of deductive alternates will not reduce
the tie-breaker scoring used by the California Tax Credit Allocation Committee in its award of
the Nine Percent Tax Credits for the Project.
(b) The Developer shall prepare and submit to the Agency for its approval
preliminary and final landscaping and preliminary and finish grading plans for the Site. Those
plans shall be prepared and submitted within the times established in the Schedule of
Performance. The landscaping plans shall include a lighting program which highlights the
design of components of the development including but not limited to building facades,
architectural detail, landscaping and sculpture. The landscaping plans shall be prepared by a
licensed landscape architect and the grading plans shall be prepared by a licensed civil engineer.
Such landscape architect and/or civil engineer may be the same firm as the Developer’s architect.
Within the time established in the Schedule of Performance, the Developer shall submit to the
Agency for approval the name and qualifications of its architect, landscape architect, and civil
engineer.
(c) Progressively detailed plans shall be approved by the Agency if building
elevations, exterior spaces and areas open to public view do not vary and the plans otherwise do
not materially vary from previously approved plans, and if they are a logical evolution of
previously approved plans and conform to the provisions of the Scope of Development. In the
event of the disapproval by the Agency of any plans submitted by Developer, the Agency shall
promptly communicate in writing to Developer all reasons for such disapproval and all
requirements for subsequent approval of revised plans.
(d) During the preparation of all drawings and plans for the Project, the Agency staff
and Developer shall hold regular progress meetings to coordinate the preparation of, submission
to, and review of construction plans and related documents by the Agency. The Agency staff
and 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 timely consideration.
(e) If any revisions or corrections of plans approved by the Agency shall be required
by a governmental official, agency, department or bureau having jurisdiction over the
development of the Site, Developer and the Agency shall cooperate in efforts to obtain waiver of
such requirements or to develop a mutually acceptable alternative. Neither the Agency nor
Developer shall unreasonably withhold approval of a mutually acceptable alternative.
Section 404 Agency Approval of Project Plans, Drawings and Related Documents
As provided in Section 403, the Agency shall have the right of reasonable review
(including, but not limited to, architectural review) of all plans, drawings and related documents
for the development of the Project, including any proposed changes therein. The Agency shall
approve or disapprove such plans, drawings, and related documents referred to in this DDA (and
any proposed changes therein), in writing, within the times established in the Schedule of
Performance. Any disapproval shall state, in writing, the reasons for disapproval. Developer,
upon receipt of disapproval, shall revise such portions of the plans, drawings or related
documents in a manner that satisfactorily addresses the reasons for disapproval and resubmit
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such revised portions to the Agency as soon as possible after receipt of the notice of disapproval.
The Agency shall approve or disapprove such revised portions in the same manner and within
the same times as provided in this Section 404 for approval or disapproval of plans, drawings,
and related documents initially submitted to the Agency. No matter once approved shall be
subsequently disapproved.
Section 405 Project Development Costs
(a) Except as otherwise expressly set forth in this DDA and except for the Agency
Loan, the cost of developing the Project shall be the responsibility of the Developer, as provided
in the Method of Financing. The Project Costs, which include the cost of prevailing wages
pursuant to California Labor Code section 1720, are set forth in the Project Budget, which shall
be subject to change from time-to-time as provided in the Method of Financing.
(b) Within the time provided in the Schedule of Performance, Developer shall submit
its application for Nine Percent Tax Credits to the California Tax Credit Allocation Committee
and shall concurrently provide a copy of its application to the Agency. Notwithstanding the
foregoing, the Agency and Developer agree that if Developer does not receive an allocation of
Nine Percent Tax Credits on its first application, then Developer shall submit an application in
the next application round and the dates in the Schedule of Performance shall adjusted
accordingly.
(c) The Developer has proposed, and the Agency has approved, the Project Budget
appended to this DDA. Developer acknowledges that the Agency is relying on Developer’s
experience and expertise in establishing the costs for the Project and Developer represents that
the Project Budget is based on the best, good faith estimate of the Developer of the costs that are
likely to be incurred for the Project.
Section 406 Schedule of Performance
(a) Developer and the Agency shall perform all acts respectively required of such
party in this DDA within the times provided in the Schedule of Performance.
(b) After the Construction Financing Event, Developer shall promptly begin and
thereafter diligently prosecute to completion the development of the Project as provided in the
Scope of Development. Developer shall begin and complete all development within the times
specified in the Schedule of Performance, subject to Force Majeure and with such reasonable
extensions of said times as may be granted by the Agency. The Schedule of Performance is
subject to revision from time to time as mutually agreed upon in writing by Developer and the
Agency.
(c) During periods of construction, Developer shall submit to the Agency a written
report of the progress of construction when and as requested by the Agency, but not more
frequently than monthly. The report shall be in such form and detail as may be reasonably
required by the Agency and shall include a reasonable number of construction photographs (if
requested) taken since the last report by Developer.
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Section 407 Local, State, and Federal Laws
(a) Developer hereby agrees to carry out development, construction (as defined by
applicable law) and operation of the Project, including, without limitation, any and all public
works (as defined by applicable law), in conformity with all applicable local, state and federal
laws, rules and regulations and all applicable federal and state labor laws (including, without
limitation, any requirement to pay state prevailing wages). Developer hereby expressly
acknowledges and agrees that neither City of Culver City nor the Agency has ever previously
affirmatively represented to the Developer or its contractor(s) for the Project in writing or
otherwise, in a call for bids or otherwise, that the work to be covered by the bid or contract is not
a “public work,” as defined in Section 1720 of the Labor Code. Developer hereby agrees that
Developer shall have the obligation to provide any and all disclosures, representations,
statements, rebidding, and/or identifications which may be required by Labor Code Sections
1726 and 1781, as the same may be enacted, adopted or amended from time to time, or any other
provision of law. Developer hereby agrees that Developer shall have the obligation to provide
and maintain any and all bonds to secure the payment of contractors (including the payment of
wages to workers performing any public work) which may be required by the Civil Code, Labor
Code Section 1781, as the same may be enacted, adopted or amended from time to time, or any
other provision of law. The Developer hereby agrees that the Developer shall have the
obligation, at the Developer’s sole cost, risk and expense, to obligate any party as may be
required by Labor Code Sections 1726 and 1781, as the same may be enacted, adopted or
amended from time to time, or any other provision of law. Developer shall indemnify, protect,
defend and hold harmless the Agency, City and their respective officers, employees, contractors
and agents, with counsel reasonably acceptable to the Agency and City, from and against any
and all loss, liability, damage, claim, cost, expense, and/or “increased costs” (including labor
costs, penalties, reasonable attorneys fees, court and litigation costs, and fees of expert
witnesses) which, in connection with the development, construction (as defined by applicable
law) and/or operation of the Project, including, without limitation, any and all public works (as
defined by applicable law), results or arises in any way from any of the following: (1) the
noncompliance by Developer of any applicable local, state and/or federal law, including, without
limitation, any applicable federal and/or state labor laws (including, without limitation, if
applicable, the requirement to pay state prevailing wages); (2) the implementation of Sections
1726 and 1781 of the Labor Code, as the same may be enacted, adopted or amended from time to
time, or any other similar law; (3) failure by Developer to provide any required disclosure,
representation, statement, rebidding and/or identification which may be required by Labor Code
Sections 1726 and 1781, as the same may be enacted, adopted or amended from time to time, or
any other provision of law; (4) failure by Developer to provide and maintain any and all bonds to
secure the payment of contractors (including the payment of wages to workers performing any
public work) which may be required by the Civil Code, Labor Code Section 1781, as the same
may be enacted, adopted or amended from time to time, or any other provision of law; and/or (5)
failure by the Developer to obligate any party as may be required by Labor Code Sections 1726
and 1781, as the same may be enacted, adopted or amended from time to time, or any other
provision of law. It is agreed by the parties that, in connection with the development,
construction (as defined by applicable law) and operation of the Project, including, without
limitation, any public work (as defined by applicable law), Developer shall bear all risks of
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payment or non-payment of state prevailing wages and/or the implementation Labor Code
Sections 1726 and 1781, as the same may be enacted, adopted or amended from time to time,
and/or any other provision of law. At the request of the Developer, the Agency shall reasonably
cooperate with and assist the Developer in its defense of any such claim, action, suit, proceeding,
loss, cost, damage, liability, deficiency, fine, penalty, punitive damage, or expense; provided that
the Agency shall not be obligated to incur any expense in connection with such cooperation or
assistance. “Increased costs” as used in this Section shall have the meaning ascribed to it in
Labor Code Section 1781, as the same may be enacted, adopted or amended from time to time.
The foregoing indemnity shall survive termination of this DDA and shall continue after
recordation of the Release of Construction Covenants.
(b) Developer shall be responsible for obtaining all Permits and land use approvals
required by the City for the development of the Site, ensuring that the use of the Site for the
purposes described in this DDA complies with the zoning and other City land use regulations
(including any applicable exemptions and/or exceptions) applicable to the Site at the time of
Construction Financing Event.
(c) Prior to or concurrently with the Construction Financing Event, Developer shall
satisfy all conditions to the issuance of any Permit required for the development of the Site. The
Agency shall provide reasonable assistance to Developer in obtaining these permits but shall
have no obligation to accelerate the permitting process and shall have no liability to Developer
for damages incurred as a result of the Developer’s inability to obtain, or delay in obtaining, such
Permits. Developer understands and agrees that any Agency approvals shall not constitute or
guarantee approvals required from the City or any other governmental agency.
(d) This DDA is not a “Development Agreement” as provided in Section 65864 et
seq. of the California Government Code. Developer shall comply with all applicable conditions
of approval required by the City of Culver City.
Section 408 Nondiscrimination During Construction
Developer, for itself and its successors and assigns, agrees that during the construction of
the Improvements provided for in the DDA, Developer will not discriminate against any
employee or applicant for employment because of race, color, religion, sex, or national origin.
Section 409 Insurance
Developer shall procure and maintain, during the term of this DDA, at its sole cost and
expense, until the date that the Agency waives any such insurance requirement or requirements
in writing, the following policies of insurance on a Project specific basis:
(a) Workers’ Compensation Insurance. Pursuant to California Labor Code Section
1861, Developer acknowledges awareness of Section 3700 et seq. of said code, which requires
every employer to be insured against liability for workers’ compensation. Developer covenants
that it will comply with such laws and provisions prior to commencing any work of construction
on the Site. To the extent Developer directly employs personnel at the Project, Developer shall
maintain such Workers’ Compensation Insurance in an amount not less than the statutory
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requirements in California for bodily injury and disease and must maintain employer’s liability
coverage in an amount not less than ONE MILLION DOLLARS ($1,000,000.00). Developer
shall require all contractors to provide such Workers’ Compensation Insurance for all of the
contractors’ and subcontractors’ employees. Developer shall furnish the Agency with a
certificate of waiver of subrogation under the terms of the Workers’ Compensation Insurance
and Developer shall similarly require all contractors and subcontractors to waive subrogation.
(b) General Liability and Auto Insurance. Developer shall carry general commercial
liability insurance, including coverage for bodily injury, property damage, products/completed
operations and blanket contractual liability in an amount not less than TWO MILLION
DOLLARS ($2,000,000.00) per occurrence and FOUR MILLION DOLLARS ($4,000,000.00)
annual aggregate, combined single limit for bodily injury and property damage. All such
insurance shall be provided by insurance companies admitted in California, or if not admitted in
California, then reasonably acceptable to the Agency. Such insurance shall name the Agency
and its officers, agents, and employees acting in their official capacity, as additional insureds.
Developer (if any vehicles are owned by Developer) and its employees engaged in work on the
Project, if such employees use their personal vehicles in the course of such work, shall carry
automobile insurance, including liability coverage for bodily injury and property damage in an
amount not less than ONE MILLION DOLLARS ($1,000,000.00) per occurrence. Developer
shall require its insurer to waive its subrogation rights against the Agency and shall provide
certificates of insurance evidencing same.
(c) Site Insurance. Commencing upon the Construction Financing Event, Developer
shall obtain and maintain in force, on a Project specific basis, all-perils (to include fire and
vandalism protection) property insurance with extended coverage endorsements thereon, on the
Site, in an amount equal to the full replacement costs and/or value thereof; this policy shall
contain a replacement cost endorsement naming the Agency as insured and shall not contain a
coinsurance penalty provision. The policy shall contain a lender’s loss payable endorsement that
such proceeds shall be used to repair or rebuild any Units or other improvements situated on the
Site so damaged or destroyed; and, if not so used, such proceeds shall be paid to the Agency.
The proceeds of any such insurance payable to the Agency shall be used for rebuilding or repair
as necessary to restore the site at the sole discretion of the Agency. The policy shall name the
Agency and its officers, agents and employees acting in their official capacity as additional
insureds.
(d) Certificate of Insurance; Additional Insured Endorsements. Prior to the
Construction Financing Event, Developer shall furnish to the Agency certificates of insurance
and additional insured endorsements evidencing the foregoing insurance coverages as required
by this DDA. Such certificates and endorsements shall be subject to the reasonable approval of
the Agency’s legal counsel and shall provide the name and policy number of each carrier and
policy and shall state that the policy is currently in force and shall promise to provide that such
policies will not be cancelled without thirty (30) days prior written notice to the Agency and the
City.
(e) Developer agrees to timely pay all premiums for such insurance and, at its sole
cost and expense, to comply and secure compliance with all insurance requirements necessary
for the maintenance of such insurance. Developer agrees to submit binders, endorsements, and
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certificates evidencing such insurance to Agency. Within thirty days, if practicable, but in any
event prior to expiration of any such policy, a binder evidencing renewal or replacement
coverage, or copies of renewal policies, endorsements, or certificates evidencing the existence
thereof, shall be submitted to Agency. All insurance required of Developer under this
Agreement for shall be provided by insurers authorized to do business in the State of California
and rated A-VI or better.
(f) If Developer fails or refuses to procure or maintain insurance as required by this
DDA, the Agency shall have the right, at the Agency’s election, and upon ten (10) days prior
notice to Developer, to procure and maintain such insurance. The premiums paid by the Agency
shall be treated as a loan, due from Developer, to be paid on the first day of the month following
the date on which the premiums were paid. The Agency shall give prompt notice of the payment
of such premiums, stating the amounts paid and the name of the insured(s).
Section 410 Indemnification
(a) Developer and its successors-in-interest shall indemnify, defend and hold
harmless the City and the Agency, their elected and appointed officials, officers, employees,
agents, contractors and consultants (individually and collectively, the “Indemnitees”) from and
against any and all claims, lawsuits, judgments, liability, injury or damage, including without
limitation associated and reasonably incurred attorneys’ fees and court and litigation costs arising
out of the defense of any such claims and/or lawsuits, and actual attorneys’ fees and court and
litigation costs that may be awarded by the court and required to be paid by the Indemnitees
resulting or arising from or in any way connected to this Agreement including but not limited to
the following: (i) any plans or designs for Improvements prepared by or on behalf of Developer,
including without limitation any errors or omissions with respect to such plans or designs (except
for claims arising from work performed in reliance on the materials described in Section 305
hereof and that is performed after Developer’s transfer to the Agency of such materials); (ii) any
loss or damage to Agency resulting from any inaccuracy in or breach of any representation or
warranty of Developer, or resulting from any breach or default by Developer under this
Agreement; and (iii) the death of any person or any accident, injury, loss, or damage whatsoever
caused to any person or to the property of any person which shall occur on the Site and which
shall be directly or indirectly caused by the acts of, or any errors or omissions of, the Developer
or its officers, shareholders, directors, members, agents, servants, employees, contractors, or
invitees. Developer shall not be responsible for any liability, loss, damage, cost, or expense
(including reasonable attorney’s fees and court costs) arising from or as a result of the gross
negligence or willful misconduct of the Indemnitees.
(b) The City and/or Agency shall have the sole discretion to select legal counsel to
represent the City’s and/or Agency’s legal interests in the defense of any such lawsuits, claims or
other actions filed against the City and/or Agency. City and Agency shall hire joint outside legal
counsel, except to the extent separate counsel is necessary, such as where there may be a
potential conflict of interest between them.
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Section 411 Developer’s Relocation Obligations
Developer shall comply with the requirements of all applicable relocation laws,
including, but not limited to, the Uniform Relocation Act and the California Relocation
Assistance Act, and shall comply with related tenant notice requirements and shall provide the
Agency with true and correct copies of such notices to tenants. Developer shall also retain all
required records and the originals and/or copies of tenant notices in its files as mandated by
applicable law. Developer shall contract with the Relocation Consultant to prepare a Relocation
Plan for the Agency’s approval and to implement the approved Relocation Plan, but performance
by the Relocation Consultant shall not in any way diminish or waive Developer’s relocation
obligations under this DDA. Except as otherwise expressly set forth in the Method of Financing,
the cost of complying with all applicable relocation requirements for the Project, including the
cost of the Relocation Consultant, shall be the responsibility of the Developer.
Section 412 Disclaimer of Responsibility by the Agency
Except as otherwise expressly provided in this DDA, neither the Agency or the City
undertakes nor assumes or will have any responsibility, right or duty to Developer or to any third
party to review, inspect, supervise, pass judgment upon or inform Developer or any third party of
any matter in connection with the Site, whether with respect to the quality, adequacy or
suitability of the plans, any labor, service, equipment or material furnished to the Project, any
person furnishing the same or otherwise. Developer and all third parties shall rely upon its or
their own judgment regarding such matters, and any review, inspection, supervision, exercise of
judgment or information supplied to Developer or to any third party by the Agency in connection
with such matter is for the public purpose of providing affordable housing, and neither
Developer (except for the purposes set forth in this DDA) nor any third party is entitled to rely
thereon.
Section 413 Rights of Access
Representatives of the Agency and the City shall have the reasonable right of access to
the Site without charges or fees, at normal construction hours during the period of construction
for the purposes of this Agreement, including, but not limited to, the inspection of the work
being performed in constructing the Improvements. Such representatives of the Agency or the
City shall be those who are so identified in writing by the Executive Director of the Agency (or
his designee).
Section 414 Taxes, Assessments, Encumbrances and Liens
Subject to Developer’s right to claim any exemption to which it may be entitled under
State law, Developer shall be responsible for paying when due all real estate taxes and
assessments, if any, assessed and levied on or against the Site or any portion thereof or interest
therein. Developer shall not place, or allow to be placed, on the Site or any portion thereof or
interest therein, any mortgage, trust deed, encumbrance (excluding easements not unreasonably
interfering with the use of the Site) or lien (excluding mechanic’s liens paid prior to foreclosure
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or liens for current year property taxes not paid) except the Permitted Transfers. Developer shall
remove, or shall have removed, any levy or attachment made on the Site (or any portion thereof
or interest therein), or shall assure the satisfaction thereof within a reasonable time but in any
event prior to foreclosure. Nothing herein contained shall be deemed to prohibit Developer from
contesting the validity or amount of any tax, assessment, encumbrance or lien, nor to limit the
remedies available to Developer in respect thereto. The covenants of Developer set forth in this
Section 414 relating to the placement of any unauthorized mortgage, trust deed, encumbrance or
lien, shall remain in effect until issuance of the Release of Construction Covenants.
Section 415 Security Financing; Right of Holders
(a) Permitted Encumbrances. Developer shall be permitted to enter into
mortgages, deeds of trust or other form of conveyance in which the Site is used as security for
the purpose of securing the Senior Loans and any other loans of funds to be used for the
implementation of the Project provided such conveyance (i) is for the purposes permitted herein
and (ii) is given to a financial or lending institution or other acceptable person or entity capable
of performing or causing to be performed Developer’s obligations under this Agreement,
including without limitation a pension fund, insurance company, or real estate investment trust.
Any and all such loan amounts and security conveyances shall be subject to the prior approval of
the Agency’s Executive Director, which approval shall not be unreasonably withheld or delayed.
(b) 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 Developer with
respect to any breach by Developer in performance of this DDA, it will endeavor at the same
time to deliver a copy of such notice or demand to each approved holder of record of any
mortgage, deed of trust, or other security interest which has previously requested such notice in
writing. 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 commence and
thereafter to diligently proceed to cure or remedy such default and add the cost thereof to the
security interest debt and the lien on its security interest. Any holder completing the
development of the Site in accordance with this DDA shall be entitled to a Release of
Construction Covenants upon written request made to the Agency.
Section 416 Rights to Plans
(a) Subject to the rights of, and senior assignments to, the beneficiaries of the Senior
Deed of Trust (the “Senior Beneficiaries”), all work product prepared pursuant to this DDA
(other than internal financial projections and analysis and materials qualifying as attorney work
product), including (but not limited to), all Plans, construction documents, soils tests and similar
reports, Permits and other entitlements are hereby assigned to the Agency as security for
Developer’s obligations hereunder. In the event that this DDA is terminated by the Agency due
to a default by Developer which is not timely cured, Developer shall, within ten (10) days of
such termination, transmit all such work product to the Agency, without representation or
warranty.
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(b) To effectuate the assignment described in paragraph (a), concurrently with
executing this DDA, Developer shall execute and deliver to the Agency an Assignment of
Agreements (the “Assignment”), substantially in the form attached to this DDA as Exhibit No.
“14”, granting to the Agency all of Developer’s rights to: (1) the Plans prepared pursuant to this
DDA; (2) the contracts between Developer and its architect and between Developer and its
general contractor; (3) all Permits relating to the Project; and all similar rights and property
interests.
Section 417 Hazardous Materials
Before commencing demolition of the existing improvements on the Site, the Developer
shall submit to the Agency for approval an asbestos and lead survey, which shall set forth the
remedial and precautionary procedures to be followed by Developer. Developer, from and after
the Construction Financing Event shall indemnify, defend, and hold harmless the Agency and its
officers, employees, agents and representatives (collectively, the “Indemnified Parties”) from
and against any and all liabilities (including penalties, fines and monetary sanctions) arising from
a violation of state or federal law pertaining to (i) the storage of Hazardous Materials on the Site
or (ii) contamination of the Site by a release of Hazardous Materials. Developer, prior to the
Construction Financing Event, shall provide to the Agency a copy of any notices, orders, or
reports concerning the presence of any Hazardous Materials on or affecting the Site that is in
Developer’s possession. As a condition precedent to the Construction Financing Event,
Developer shall execute and deliver to the Agency an Environmental Indemnity, substantially in
the form of Exhibit No. “15” to this DDA.
Section 418 Release of Construction Covenants
(a) Promptly after Completion of the development of the Site, as generally and
specifically required by this DDA and in particular the Scope of Development, the Agency shall
furnish Developer with a Release of Construction Covenants in the form of Exhibit No. “16” to
this DDA, upon written request therefor by Developer. The Agency shall not unreasonably
withhold such Release of Construction Covenants and such Release of Construction Covenants
shall be issued so long as Developer has developed the Site in accordance with this DDA and the
Plans approved by the Agency pursuant hereto. Such Release of Construction Covenants shall
be, and shall so state, conclusive determination of satisfactory completion of all of the
construction required by this DDA.
(b) The Release of Construction Covenants shall be in such form as to permit it to be
recorded in the Official Records of Los Angeles County. A Release of Construction Covenants
for development of less than the entire Site shall not be recorded.
(c) If the Agency refuses or fails to furnish a Release of Construction Covenants for
the Site after written request from Developer, the Agency shall, within thirty (30) days of the
written request, provide Developer with a written statement of the reasons the Agency refused or
failed to furnish a Release of Construction Covenants. The statement shall also contain the
Agency’s opinion of the action Developer must take to obtain a Release of Construction
Covenants. If the reason for such refusal is confined to the immediate availability of specific
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items or materials for landscaping, and/or minor items, the Agency will issue its Release of
Construction Covenants upon the posting of a bond by Developer with the Agency in an amount
representing the fair value of the work not yet completed.
(d) Such Release of Construction Covenants shall not constitute evidence of
compliance with, or satisfaction of any obligation of Developer to the beneficiary of, the Senior
Deed of Trust. Such Release of Construction Covenants is not a notice of completion as referred
to in Section 3093 of the California Civil Code.
ARTICLE V USE OF THE PROPERTY
Section 501 Uses
(a) Developer covenants and agrees (for itself, its successors, its assigns, and every
successor in interest to the Site or any part thereof or any interest therein) that during the
Restricted Period, Developer, its successors and assigns shall use the Site (except for the
Commercial Space) exclusively to provide rental housing, including affordable housing for Very
Low Income, Low Income and Moderate Income Households as set forth in this DDA.
Developer further covenants and agrees, for itself, its successors, its assigns, and every successor
in interest to the Site, or any part thereof, that during the Restricted Period, Developer and such
successors shall not use the Site in a manner that is inconsistent with the applicable zoning
restrictions, this Agreement, the Grant Deed and the Agreement Containing Covenants.
(b) No part of the Project will at any time during the Restricted Period be owned by a
cooperative housing corporation or be converted to condominium ownership nor shall Developer
take any steps in connection with a conversion to such ownership or uses, provided, however,
Developer may with the Agency’s approval create a commercial condominium unit for the
Commercial Space.
(c) The parties anticipate that the Agency will enter into an agreement with the owner
of the parcel adjacent to the Site (located at 11030 Washington Boulevard) to provide funds for
facade improvements on that property and that the Developer will (as a Project expense) perform
repair of the shell and the electrical, plumbing, and HVAC systems to bring the space into
compliance with the Culver City Building Code and will lease space in the rehabilitated
improvements located thereon to use for construction management and leasing activities related
to the Project (the “Leasing Office”) commencing as of the date of the Construction Financing
Event and continuing through the initial lease-up of the Project. The Developer acknowledges
and agrees that the Agency is neither representing nor warranting that it will successfully enter
into an agreement for the facade improvements or that the façade improvements will be
completed in the time and manner that is required by the Developer. The Developer further
acknowledges and agrees that, if the Developer enters into a lease with the owner of the property,
it does so at the risk that rehabilitation of the Leasing Office and completion of the façade
improvements might not be completed in the time or manner required by the Developer and
releases the Agency from any and all claims relating to or arising from the Developer’s
anticipated use of the Leasing Office.
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Section 502 Selection of Commercial Tenants
(a) It is the Agency’s intent that the financial assistance provided by the Agency to
the Project will assist in revitalizing the neighborhood, in addition to producing the Affordable
Units. Therefore, Developer agrees that it will use diligent and good faith efforts to obtain
Commercial Tenants that will serve the neighborhood (with a preference to products or services
that are not currently offered in the market area), will offer products or services that are of a
quality that is above what is currently available in the market area, will minimize negative
impacts on the neighborhood from noise, littering, odors, traffic, parking, etc. and will constitute
one of the following uses:
1. Media production
2. Printing and publishing
3. Public recreational and cultural facilities
4. Studios – art, dance, music, photography
5. Accessory food service
6. Accessory retail uses
7. Artisan shops
8. Convenience stores
9. General retail
10. Internet café
11. Restaurants, table service
12. Restaurants, outdoor café
13. Business and consumer support services
14. Offices
15. Other uses approved by the Agency Executive Director or designee
(b) Developer shall meet with Agency staff on a regular basis to discuss the progress
of obtaining Commercial Tenants that meet the objectives set forth in Section 502(a) above and
to facilitate the Agency’s review of proposed Commercial Tenants.
(c) Before entering into any binding agreement, including binding letters of intent or
leases, with a proposed tenant of the Commercial Space, Developer must submit to the Agency
for approval the following:
1. a description of the proposed Commercial Tenant, including its business
name, the location of its headquarters and branch locations (if applicable),
the date the organization was established, and whether it is a subsidiary or
parent organization of another entity,
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2. organizational documents the Agency may reasonably require to confirm
that the proposed Commercial Tenant is an entity in good standing in the
State of California,
3. if the proposed Commercial Tenant currently conducts business in Culver
City, a copy of its Culver City tax certificate,
4. evidence satisfactory to the Agency that the use proposed by the
Commercial Tenant will comply with the City’s zoning code and parking
ordinance and will be fully served by on-site parking;
5. a description of the activities the proposed Commercial Tenant will be
involved in, including, for example, the goods or services that will be
offered to the public and the proposed hours of operation,
6. assurance reasonably satisfactory to the Agency that the proposed
Commercial Tenant will provide management oversight that is appropriate
to its proposed activities and that will be responsive to neighborhood
concerns, which assurance may be in the form of specific lease provisions,
7. evidence satisfactory to the Agency that the proposed Commercial Tenant
has the financial capability to carry out its proposed activities and to meet
its obligations under its lease,
8. the square footage that will be occupied by the proposed Commercial
Tenant, which shall not be less than 1,500 gross square feet (or such
smaller area as may be approved by the Agency Executive Director or
designee), and the number of parking spaces that will be reserved for its
use,
9. any exterior tenant improvements that are proposed, including but not
limited to, exterior signage and lighting,
10. a copy of the proposed agreement, which must not contain any automatic
right of renewal or extension or any right to sublet the space or assign the
agreement without the consent of Developer, and
11. other information the Agency reasonably requires to evaluate whether the
proposed commercial Tenant meets the requirements of this Agreement
and the Agency’s objectives for the Project set forth in Section 502(a)
above.
(d) The Agency shall have thirty (30) days to investigate and approve or disapprove
the proposed Commercial Tenant. The Agency’s approval of proposed Commercial Tenants shall
not be unreasonably withheld. The Agency’s approval rights set forth in paragraph (c) above
shall remain in effect from the Conversion Date through the later of (i) November 23, 2029 or
(ii) the time limit for the effectiveness of Component Area No. 4 in the Culver City
Redevelopment Project (the “Commercial Approval Period”).
(e) In addition, during the Commercial Approval Period, if Developer proposes to
enter into a new lease with an existing Commercial Tenant or approve an assignment or
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subletting under an existing lease, then Developer shall give the Agency written notice at least
forty-five (45) days in advance of entering into a binding agreement. Developer and the Agency
agree to meet for the purpose of identifying any concerns the Agency may have with the
Commercial Tenant’s activities at the Project and making a good faith effort to resolve such
concerns. During the Commercial Approval Period, the Agency’s approval rights over a new
lease with an existing Commercial Tenant shall be the same as the Agency’s approval rights set
forth in paragraph (c) above.
(f) It will be a default of this Agreement if, during the Commercial Approval Period,
Developer enters into a lease with a Commercial Tenant without having first obtained the
Agency’s written approval.
(g) After the expiration of the Commercial Approval Period and continuing until the
last day of the Restricted Period, the Agency’s rights and the Developer’s obligations with regard
to the selection of Commercial Tenants shall be as follows. If Developer proposes to enter into a
lease with a new Commercial Tenant or if Developer proposes to enter into a new lease with an
existing Commercial Tenant, then Developer shall give the Agency written notice at least thirty
(30) days in advance of entering into a binding agreement, and shall, at the same time, provide
the Agency with the information and documents set forth in paragraph (c) above. The Agency
shall have fifteen (15) business days to investigate and approve or disapprove the proposed
Commercial Tenant. If the Agency disapproves a proposed Commercial Tenant (in its reasonable
discretion), it may (but shall not be obligated to) provide Developer with the names of potential
Commercial Tenants that the Agency has determined are appropriate for the Project. Developer
agrees to work with diligently and in good faith to obtain an appropriate replacement
Commercial Tenant, which shall be subject to the Agency’s approval rights set forth in
paragraph (c) above. If Developer and the Agency have not identified an acceptable replacement
Commercial Tenant within ninety (90) days after the Agency’s receipt of the initial notice from
Developer required by this paragraph, then Developer may lease the Commercial Space to the
tenant of its choice, provided that Developer must first give written notice to the Agency of the
proposed Commercial Tenant and the Agency shall have fifteen (15) days to comment.
Section 503 No Housing Set Aside Subsidy of Commercial Space
Developer acknowledges that the Residential Loan is being funded with the Agency’s Set
Aside Funds, the use of which is restricted to payment of the reasonable cost of developing the
Affordable Units, and that the source of repayment of the Residential Loan will be the Residual
Receipts generated by the Affordable Units. Therefore, Developer agrees that revenue achieved
from the rental of the Affordable Units shall not be used to pay operating and maintenance costs
relating to the Commercial Space. To that end, Developer shall maintain separate revenue and
operating accounts for the Affordable Units and the Commercial Space and shall establish and
maintain separate reserve accounts. The Annual Project Budget described in Section 504 below
shall include a separate budget for the Commercial Space, which shall demonstrate to the
Agency’s satisfaction that no revenues related to the Affordable Units will be used to pay
operating and maintenance costs related to the Commercial Space. In addition, the Quarterly
Reports required by Section 504 below shall set forth the required information separately for the
Affordable Units and the Commercial Space.
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Section 504 Management Plan; Annual Project Budget; Quarterly Reports
(a) Prior to the Construction Financing Event, Developer shall submit to the Agency
a Management Plan acceptable to the Agency, describing the proposed plans for managing and
operating the Site, which shall include the Maintenance Program described in Section 505 below.
The Management Plan shall also include a description of the proposed social services to be
provided to the tenants, including any proposed after school programs, in conformity with the
requirements set forth in Section 4.4(a)(6) of the Agreement Containing Covenants. Approval of
the Management Plan by the Agency shall be a condition precedent to the Construction
Financing Event. Developer shall manage and operate the Site in accordance with the approved
Management Plan, including such amendments as may be approved in writing from time to time
by the Developer and the Agency, for the entire Restricted Period.
(b) In addition, the Developer shall submit to the Agency on or before the first day of
each fiscal year of the Restricted Period an estimated annual budget for management of the Site
(the “Annual Project Budget”) in accordance with the Management Plan. The Annual Project
Budget shall include all necessary operating expenses, current maintenance charges, expenses of
reasonable upkeep and repairs, taxes and special assessment levies, prorated amounts required
for insurance and all other expenses incident to the operation of the Project; and shall show the
expected revenues to pay such expenses, including annual debt service requirements and reserve
fund deposits and balances. The Annual Project Budget, including any amendments proposed by
the Developer, shall be subject to the approval of the Agency which shall not be unreasonably
withheld or delayed.
(c) Beginning on the date of first occupancy, and for each fiscal year thereafter of the
Restricted Period, Developer shall also submit to the Agency on a quarterly basis a report for the
management of the Site (the “Quarterly Report”). The Quarterly Report shall include a profit
and loss statement, budget to date figures, and occupancy report and shall clearly show project
revenues, operating expenses, deposits to and withdrawals from the Project’s Capital Reserve
Accounts. The Quarterly Report shall be in a form that is reasonably acceptable to the Agency.
The Agency in its sole discretion may waive the requirement of the Quarterly Report for one or
more quarterly reporting periods. However, such waiver shall not operate to waive any
subsequent requirement of the Quarterly Report during the Restricted Period. After receipt of
such certified financial statements for the Project, the Agency may request additional financial
analyses or obtain a third party review at the Agency’s own expense, of financial statements for
the Project to verify the accuracy of the payments by Developer on the Residential Note and the
Commercial Note or the required deposits into the Capital Reserve Accounts. If the Agency’s
review of Developer’s Quarterly Report reveals material errors in the calculation of the payments
by Developer on the Residential Note or the Commercial Note or reveals that the required
deposits into the Capital Reserve Accounts have not been made, then Developer shall reimburse
the Agency for its cost of conducting the financial analyses or obtaining a third party review.
Section 505 Maintenance of the Site
(a) Prior to the Construction Financing Event, the Developer shall prepare and submit
to the Agency for review and approval a program (the “Maintenance Program”) for the exterior
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and interior maintenance of the Site and the Improvements. The Agency and the City shall have
the right at all reasonable times and, except in the event of an emergency, upon reasonable prior
notice, to enter and inspect the Site in order to ensure compliance with the foregoing
requirements.
(b) The Maintenance Program shall describe in reasonable detail the standards to be
followed in maintaining the interior and exterior of the Improvements, including a schedule
indicating the proposed frequency of each element of maintenance, and shall include, at a
minimum, the following: periodic cleaning of the interior and exterior of the Improvements,
including windows; removing graffiti; removing debris and waste materials and otherwise
maintaining indoor and outdoor areas of the Site; maintaining any lawns, plants, shrubs and trees
or other landscaping planted on the Site; performing inspections of all exterior features to
determine whether repairs are required; conducting periodic protective treatments such as rust
removal and caulking; conducting repairs to facades, roof, doors, windows and other exterior
features; maintaining fencing and other security devices and systems; periodic repainting of the
exterior; periodic repainting of the interior units and common areas; periodic replacing of the
interior unit carpets; checking building systems, including, but not limited to the heating and
cooling systems, smoke alarms and water heaters; checking interior unit appliances; and
monitoring interior unit bathrooms for mold/mildew. The Maintenance Program shall set forth
policies and procedures to assure that maintenance, repair and reconstruction activities will be
carried out in a way that preserves the Project’s LEED Silver standards as set forth in this
Agreement. The Maintenance Program, including any amendments proposed by the Developer,
shall be subject to the reasonable approval of the Agency.
(c) At all times during the Restricted Period, the Developer shall maintain the Site
and the Improvements in accordance with the approved Maintenance Program and in compliance
with applicable state and local laws and codes. To implement this requirement, Developer
agrees to budget sufficient funds to pay for all reasonably anticipated costs (as indicated in the
Annual Maintenance Budget). In the event Developer fails to maintain the Site as required by
this Section, Developer shall, within thirty (30) days after the Agency’s notification or
Developer’s own discovery of any deficiency, take all necessary steps to correct such deficiency,
provided that, if such deficiency is not reasonably capable of being cured within thirty (30) days,
Developer shall commence to cure said deficiency within thirty (30) days and diligently and in
good faith continue to take all necessary steps to correct such deficiency. In the event the
Developer fails to cure said deficiency within the time allowed, the Agency shall have the right,
but not the obligation, to enter the Site, correct any violation, and hold the Developer responsible
for the cost thereof, and such cost, until paid, shall constitute a lien on the Site, which shall at all
time be junior to the lien of the Senior Lender.
Section 506 Lead-Based Paint.
Developer shall ensure that it and its contractors and subcontractors shall not use lead-
based paint in the development or maintenance of the Project. Developer shall insert this
provision in all contracts and subcontracts for work performed on the Project which involves the
application of paint.
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Section 507 Barriers to the Disabled
Developer shall ensure that the Project will be developed and operated to comply with all
federal, state, and local requirements for access for disabled persons that apply to newly
constructed multi-family rental units and, with regard to the Commercial Space, all federal, state
and local requirements for access for disabled persons that apply to new constructed commercial
space.
Section 508 Creation of Capital Reserve Accounts
Concurrently with or prior to the Permanent Financing Event, Developer shall create
“Capital Reserve Accounts” for the Affordable Units and ancillary residential space in the initial
amount shown on the Project Budget and for the Commercial Space and ancillary space in an
amount mutually agreed to by the Agency and Developer. No later than thirty (30) days after the
Capital Reserve Accounts have been created, Developer shall provide to the Agency a pro forma
statement concerning the accounts, for review and approval. At any time thereafter during the
term of this Agreement, the Agency, on ten (10) days prior written notice to Developer, may
request that Developer submit to it an updated, revised Capital Reserve Account statement. The
Agency, at its own expense, may audit any updated, revised Capital Reserve Account statements
submitted to it by Developer, provided that, if the audit reveals that the required deposits into the
Capital Reserve Accounts have not been made, then Developer shall reimburse the Agency for
its cost of conducting the audit.
Section 509 Deposits Into Capital Reserve Accounts
Beginning not later than the Permanent Financing Event and every succeeding year
during the Restricted Period, Developer shall deposit the amounts set forth in the definition of
Residential Operating Expenses in the Residential Note and the capital reserves amount mutually
agreed to by the Agency and Developer for the Commercial Space into the respective Capital
Reserve Accounts for repairs or replacements to the Site Improvements. The Capital Reserve
Accounts shall only be used to fund the cost of repairs and improvements to the Site and to
maintain the Site in compliance with the requirements of Section 505. Developer shall exhaust
funds in the Capital Reserve Accounts prior to utilizing operating revenues to pay for
capitalizable repairs and improvements to the Site that are not typically paid for from operating
income. Interest earned on the Capital Reserve Accounts shall remain in said account and be
used as Capital Reserves.
Section 510 Obligation to Refrain from Discrimination
There shall be no discrimination against or segregation of any person, or group of
persons, on account of race, color, creed, age, class, income (other than as required by applicable
regulatory agreements), religion, sex, sexual orientation, marital status, national origin or
ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Site, or
any part thereof, or in the Developer’s employment practices, or in the awarding of contracts for
the Project, nor shall Developer, or any person claiming under or through it, establish or permit
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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
Site, or any part thereof, in employment practices, or in the awarding of contracts for the Project.
Developer shall comply with all applicable federal, state and local nondiscrimination, fair
housing, and equal opportunity requirements.
Section 511 Form of Nondiscrimination and Nonsegregation Clauses
The Developer shall refrain from restricting the rental, sale or lease of the Site or the
Units on the basis of race, color, creed, age, class, income (other than as required by applicable
regulatory agreements), religion, sex, sexual orientation, 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 clause:
(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 any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as
those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of
subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale,
lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the premises herein conveyed,
nor shall the grantee or any person claiming under or through him or her, establish or permit any
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 premises
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. That
there shall be no discrimination against or segregation of any person or group of persons, on
account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as
those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of
subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the 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 any basis listed in subdivision (a) or (d) of Section
12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1,
subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of
the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment
of the land, nor shall the transferee itself or any person claiming under or through him or her,
establish or permit any such practice or practices of discrimination or segregation with reference
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to the selection, location, number, use, or occupancy, of tenants, lessees, sublessees, subtenants,
or vendees of the land.”
Section 512 Effect and Duration of Covenants
The covenants established in this DDA shall, without regard to technical classification
and designation, be binding on Developer and any successor in interest to the Site or any part
thereof or interest therein for the benefit and in favor of the Agency, its successors and assigns.
Every covenant and condition and restriction contained in the Agreement Containing Covenants
shall remain in effect commencing upon the recordation of the Agreement Containing Covenants
and throughout the Restricted Period (regardless of whether the Agency Loan has been repaid
prior to the end of the Restricted Period), except that the covenants against discrimination set
forth in the Agreement Containing Covenants and in Section 510 and Section 511 hereof shall
remain in effect in perpetuity.
Section 513 Effect of Violation of Covenants
The Agency is the intended beneficiary of the terms and provisions of this DDA and the
covenants herein, both for and in its own right and for the purposes of protecting the interests of
the community and other parties, public or private, for whose benefit this DDA and the
covenants running with the land have been provided. The Agency shall have the right if the
covenants contained in this DDA are breached, to exercise all rights and remedies, and to
maintain any actions or suits at law or in equity or other proper proceedings to enforce the curing
of such breaches to which it or any other beneficiaries of this DDA and covenants are entitled.
Section 514 Monitoring
(a) The parties acknowledge that this DDA is subject to the provisions of Section
33418(a) of the California Health and Safety Code, which provides in pertinent part:
“An Agency shall monitor, on an ongoing basis, any housing affordable to persons and
families of low or moderate income developed or otherwise made available pursuant to any
provisions of this part. As part of this monitoring, an agency shall require owners or managers
of the housing to submit an annual report to the agency. The annual reports shall include for
each rental unit the rental rate and the income and family size of the occupants. The income
information required by this section shall be supplied by the tenant in a certified statement of a
form provided by the agency.”
(b) Developer shall submit to the Agency on an annual basis the report required by
said Section 33418. The annual report shall include for each Very Low Income Unit, each Low
Income Unit and each Moderate Income Unit, the rental rate and the income and family size of
the occupants. The income information shall be supplied by the tenant in a certified statement on
a form provided by the Agency. Developer shall provide for the submission of such information
in its lease or occupancy agreement with tenants.
(c) Health and Safety Code Section 33418(b) requires the Agency to adequately fund
its compliance monitoring activities and authorizes the Agency to impose fees upon the owners
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of properties monitored pursuant to Section 33418 to defray the cost of complying with the
Agency’s monitoring and reporting obligations. Therefore, Developer agrees that, commencing
upon the Completion of the Project, Developer will pay to the Agency an annual monitoring fee
in the amount set forth in the definition of “Annual Operating Expenses” in the Agency Note.
ARTICLE VI DEFAULTS, REMEDIES AND TERMINATION
Section 601 Defaults; Notice of Cure; Cure Rights
(a) Subject to Force Majeure Delay, as such term is defined in this DDA, failure or
delay by either party to perform any term or provision of this DDA constitutes a default under
this DDA. The party who fails or delays must immediately commence to cure, correct or remedy
such failure or delay and shall complete such cure, correction or remedy with reasonable
diligence.
(b) The injured party shall give written notice of default to the party in default,
specifying the default complained of by the injured party. Failure or delay in giving such notice
shall not constitute a waiver of any default, nor shall it change the time of default. Except as
otherwise expressly provided in this DDA, 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. Delays by either party in asserting any of its rights and remedies shall
not deprive 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.
(c) If a monetary event of default occurs, prior to exercising any remedies hereunder,
the injured party shall give the party in default written notice of such default. The party in
default shall have a period of ten (10) days after such notice is given within which to cure the
default prior to exercise of remedies by the injured party.
(d) If a non-monetary event of default occurs, prior to exercising any remedies
hereunder, the injured party shall give the party in default notice of such default. If the default is
reasonably capable of being cured within thirty (30) days, the party in default shall have such
period to effect a cure prior to exercise of remedies by the injured party. If the default is such
that it is not reasonably capable of being cured within thirty (30) days, and the party in default (i)
initiates corrective action within said period, and (ii) diligently, continually, and in good faith
works to effect a cure as soon as possible, then the party in default shall have such additional
time as is reasonably necessary to cure the default prior to exercise of any remedies by the
injured party. In no event shall the injured party be precluded from exercising remedies if its
security becomes or is about to become materially jeopardized by any failure to cure a default or
the default is not cured within ninety (90) days after the first notice of default is given.
Section 602 Institution of Legal Actions
Subject to the notice and cure provisions of Section 601 and the limited recourse
provisions of Section 611, in addition to any other rights or remedies, either party may institute
legal action to cure, correct or remedy any default, to recover damages for any default, or to
obtain any other remedy consistent with the purpose of this DDA. Such legal actions must be
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instituted in the Superior Court of the County of Los Angeles, State of California, in any other
appropriate court of that county, or in the United States District Court for the Central District of
California.
Section 603 Applicable Law
The internal laws of the State of California, without regard to principles of conflicts of
laws, shall govern the interpretation and enforcement of this DDA.
Section 604 Acceptance of Service of Process
(a) 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 the
Developer’s Managing General Partner and shall be valid whether made within or without the
State of California, or in such manner as may be provided by law.
(b) 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 of the Agency or the Agency Secretary or in such other manner as may be provided by
law.
Section 605 Rights and Remedies Are Cumulative
Except with respect to rights and remedies expressly declared to be exclusive in this
DDA, 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.
Section 606 Specific Performance
If either party defaults with regard to any of the provisions of this DDA, subject to the
notice and cure provisions of Section 601, the non-defaulting party, at its option, may, after such
notice and opportunity to cure (but not before, unless necessary to prevent immediate harm)
commence an action for specific performance of the terms of this DDA pertaining to such
default.
Section 607 Termination by Agency
In addition to the other rights and remedies set forth in this Agreement, in the event that
prior to the conveyance of title to the Agency Parcel to the Developer:
1. The Developer fails to obtain its Nine Percent Tax Credit allocation within
the time specified in the Schedule of Performance (as such time may be extended pursuant to the
terms of this Agreement).
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2. the Developer shall fail to submit to the Agency any submission of
evidence of financing commitments for the Project required by the Method of Financing, within
the time established therefor in the Schedule of Performance (as such time may be extended
pursuant to the terms of this Agreement); or
3. the Developer (or any successor in interest) assigns or attempts to assign
this Agreement or any right herein, or in the Site or any portion thereof in violation of this
Agreement; or
4. other than in connection with a Permitted Transfer, there is substantial
change in the ownership of the Developer, or with respect to the identity of the parties in control
of the Developer, or the degree thereof contrary to the provisions of Section 206 hereof; or
5. the Developer shall fail to satisfy the conditions precedent to the
Construction Financing Event within the time established therefor in the Schedule of
Performance (as such time may be extended pursuant to the terms of this Agreement); or
6. the Developer shall otherwise fail to timely pay or reimburse the Agency
for any costs or expenses incurred by the Agency with respect to the Agency Parcel which are to
be borne by the Developer under this Agreement, if such failure is not cured within ten (10) days
of Developer’s receipt of notice from the Agency; or
7. the Developer does not deliver to the Agency any submission of plans,
drawings, and related documents as required by this Agreement by the date respectively provided
in this Agreement, if such failure is not cured within ten (10) days of Developer’s receipt of
notice from the Agency; or
8. the Developer does not pay the Purchase Price and take title to the Agency
Parcel under a tender of conveyance by the Agency pursuant to this Agreement,
then this Agreement and any rights of the Developer, or any assignee or transferee, in this
Agreement shall, at the option of the Agency, be terminated by written notice to the Developer.
Section 608 Termination by Developer
In addition to the other rights and remedies set forth in this Agreement if the Agency,
despite being in a position to do so, does not tender conveyance of title to the Agency Parcel, or
possession thereof, to the Developer in the manner and condition, and by the date provided in
this Agreement and such default is not cured within thirty (30) days after the date of written
demand by the Developer, then this Agreement shall, at the option of the Developer, be
terminated by written notice thereof to the Agency
Section 609 Termination by Either Party
Prior to the Construction Financing Event, either party shall have the right to terminate
this DDA in the event the other party is in default of any material term or provision of this DDA,
and, following notice, fails to cure such default within the time provided in Section 601.
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Section 610 Right of Reentry
(a) The Agency shall have the right, at its option, to reenter and take possession of
the Agency Parcel with all improvements thereon, and to terminate and revest in the Agency the
estate theretofore conveyed to the Developer (the “Right of Reentry”), if after conveyance of title
to the Agency Parcel and prior to the Conversion Date, the Developer (or its successors in
interest) shall:
1. fail to commence construction of the Improvements on the Site (or portion
thereof) as required by this Agreement for a period of three (3) months after written notice to
proceed from the Agency, provided that the Developer has not obtained an extension or
postponement to which the Developer may be entitled; or
2. abandon or substantially suspend construction of the Improvements on the
Site (or portion thereof) for a period of three (3) months (other than due to a Force Majeure
Event) after written notice of such abandonment or suspension from the Agency, provided that
the Developer has not obtained an extension or postponement to which the Developer may be
entitled; or
3. assign or attempt to assign this Agreement or any rights herein, or
effectuate or attempt to effectuate a Transfer (other than a Permitted Transfer), or suffer any
involuntary Transfer, in violation of this Agreement.
(b) The Agency’s Right of Reentry shall be subject to and be limited by and shall not
defeat, render invalid, or limit:
1. any Senior Loan Documents and
2. any rights or interests provided in this Agreement for the protection of the
holders of such Senior Loan Documents.
(c) The Agency agrees that it will not exercise its Right of Reentry until it has given
Developer and Developer’s Investor Limited Partner written notice of the occurrence of an event
giving rise to the Right of Reentry (the “Reentry Event”) and providing Developer and
Developer’s Investor Limited Partner with a thirty (30) day period in which to cure such Reentry
Event (the “Reentry Event Cure Period”). If the Reentry Event can only reasonably be cured by
the removal of Developer’s general partner, then the Reentry Event Cure Period shall be
extended to such reasonable period of time as is necessary for the Investor Limited Partner to
cause the removal and replacement of the general partner.
(d) The Right of Reentry established in this Section 610 shall no longer apply if the
Improvements to be constructed on the Site have been completed in accordance with this
Agreement.
(e) The Agency’s exercise of the Agency Option set forth in Section 611 below shall
be a condition concurrent with the Agency’s right to exercise its Right of Reentry pursuant to
this Section 610. If the Agency does not exercise the Agency Option concurrently with its
exercise of the Right of Reentry, then the Agency’s exercise of its Right of Reentry shall be null
and void and of no further effect.
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(f) The Grant Deed to the Agency Parcel shall contain appropriate reference and
provision to give effect to the Agency’s Right of Reentry set forth in this Section 610.
(g) Upon the vesting in the Agency of title to the Site, or any part thereof, as provided
in this Section 610 and in Section 611 below, the Agency shall, pursuant to its responsibilities
under state law, use its diligent and good faith efforts to resell the Site, or any 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 Site in the Redevelopment Plan. Upon such
sale of the Site, or any part thereof, the proceeds thereof shall be applied:
1. first, to reimburse the Agency on its own behalf or on behalf of the City of
all costs and expenses incurred by the Agency, including but not limited to the Option Price for
the Developer Parcel, the salaries of personnel and the cost of consultants and outside legal
counsel engaged in connection with the recapture, management, and resale of the Site, or part
thereof (but less any income derived by the Agency from the Site, or any part thereof, in
connection with such management); all taxes, assessments and water and sewer charges with
respect to the Site or part thereof incurred by the Agency; 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 Developer, its successors or transferees; any
expenditures made or obligations incurred with respect to the making or completion of the
Improvements or any part thereof on the Site, or part thereof; and any amounts otherwise owing
to the Agency by Developer and its successor or transferee; and
2. second, to reimburse Developer, its successor or transferee, up to the
amount equal to (l) the sum of the Purchase Price paid by Developer for the Agency Parcel and
the Developer Parcel; and (2) the costs incurred for the development of the Site, or part thereof,
or for the construction of the agreed Improvements thereon, if such costs were incurred in
accordance with the Method of Financing and Project Budget, less (3) any gain or income
withdrawn or made by the Developer therefrom or from the Improvements thereon. For
purposes of this paragraph the term “cost incurred” shall include direct, out-of-pocket expenses
of development, but shall exclude Developer’s overhead expenses, developer fees, and profit.
(h) Any balance remaining after such reimbursements shall be retained by the
Agency as its property. The Agency shall also be entitled to exercise all of its rights under the
Assignment of Agreements.
(i) Notwithstanding anything in this Section 610 to the contrary and subject to the
consent of the Senior Lender, upon the vesting in the Agency of title to the Site, the Agency shall
have the right, in its sole discretion to undertake the completion of the Improvements prior to its
disposition of the Site.
(j) To the extent that the Right of Reentry established in this Section 610 involves
forfeiture, it must be strictly interpreted against the Agency, the party for whose benefit it is
created. The rights established in this Section 610 are expressly authorized by Health and Safety
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Code section 33438 and are to be interpreted in light of the fact that the Agency will convey the
Agency Parcel to the Developer for development and not for speculation in undeveloped land.
Section 611 Agency’s Option to Purchase
(a) Developer hereby grants to the Agency an option to purchase that portion of the
Site referred to herein as the Developer Parcel and described in Exhibit No. 1-A to this
Agreement, together with all of Developer’s right, title and interest in and to all improvements,
easements, appurtenances, and other intangible property appurtenant to said land, upon the
following terms and conditions (the “Agency Option”).
(b) The term of the Agency Option (the “Option Term”) shall commence upon the
Effective Date of this Agreement and shall expire on the Conversion Date.
(c) The Agency’s exercise of the Right of Reentry set forth in Section 610 above
shall be a condition concurrent with the Agency’s right to exercise the Agency Option. If the
Agency does not exercise its Right of Reentry concurrently with its exercise of the Agency
Option, then the Agency’s exercise of the Agency Option shall be null and void and of no further
effect.
(d) If the Agency timely elects to exercise the Agency Option in accordance with the
terms and conditions of the Agency Option, prior to the expiration of the Option Term, then
Developer agrees to sell the Developer Parcel to the Agency and the Agency agrees to purchase the
Developer Parcel from Developer for consideration (the “Option Price”) equal to the then fair
market value of the Developer Parcel.
(e) The Agency shall exercise the Agency Option by delivering written notice to
Developer that it is exercising both the Agency Option and the Agency’s Right of Reentry (the
“Exercise Notice”). The Exercise Notice shall include a statement of the Option Price, including
an explanation of all calculations performed by the Agency to determine the Option Price. If the
Developer disputes the Option Price and the Agency and the Developer are unable to agree after
good faith efforts, then the matter shall be submitted to binding arbitration.
1. The Agency agrees to open an escrow for the sale of the Developer Parcel
to the Agency in the County of Los Angeles with an escrow company, escrow department of a
bank or escrow department of a title insurance company (the “Option Escrow Agent”) approved
by Developer and the Agency, within fifteen (15) days after the Agency delivers to Developer its
Exercise Notice. This Section 611 shall constitute the joint escrow instructions of Developer and
the Agency, and a duplicate original of such provisions shall be delivered to the Option Escrow
Agent upon the opening of such escrow.
2. Developer and the Agency shall provide such additional escrow
instructions as shall be necessary to close the escrow with respect to the sale of the Developer
Parcel to the Agency consistent with this Agency Option. The Option Escrow Agent is
empowered to act under such instructions, and upon indicating its acceptance thereof in writing,
delivered to Developer and the Agency within five (5) days after the opening of the escrow, shall
carry out its duties as Option Escrow Agent hereunder.
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3. Close of the escrow and recordation of the grant deed for the Developer
Parcel shall be completed no later than forty-five (45) days after the Agency has delivered to
Developer its Exercise Notice, or such later date as mutually agreed to in writing by Developer
and the Agency and communicated in writing to the Option Escrow Agent. Developer and the
Agency, respectively, agree to perform all acts necessary to recordation of the grant deed for the
Developer Parcel in sufficient time for escrow to be closed in accordance with the foregoing
provision.
4. The Agency shall be credited for payment of the Option Price by
depositing into Escrow the Option Price, upon or prior to the date for recordation of the grant
deed, provided that the Option Escrow Agent shall have notified the Agency in writing that the
grant deed for the Developer Parcel and a bill of sale for the Improvements have been delivered
to the Option Escrow Agent and that title is in the condition to be conveyed in conformity with
the provisions of this Agreement.
5. Concurrently with the recordation of the grant deed, a title insurance
company satisfactory to Developer and the Agency (“Option Title Company”) shall provide and
deliver to the Agency a title insurance policy issued by the Option Title Company insuring that
fee simple title to the Developer Parcel and the Improvements is vested in the Agency in the
condition required by this Agreement. The title insurance policy shall be in the amount of the
Option Price, or, if requested by the Agency, the Option Title Company shall provide the Agency
with an endorsement to insure any greater amount or higher policy limits.
6. The Agency shall pay recording charges, one-half of the escrow charge
and shall pay for all premiums for any title insurance coverage or special endorsements requested
by the Agency with respect to the Developer Parcel. Developer shall pay any State, County, or
City documentary stamps or transfer tax on the grant deed, if any, and one-half of the escrow
charge. All other escrow costs and charges shall be borne one-half by Developer and one-half by
the Authority.
7. Developer shall deposit with the Option Escrow Agent an executed grant
deed to the Agency and bill of sale for the Improvements for delivery to the Agency at the close
of escrow, in the form and substance mutually agreed upon by Developer and the Agency
consistent with this Agreement. Developer shall execute, acknowledge and deliver to the Option
Escrow Agent the grant deed at least ten (10) days prior to the scheduled date for the close of
escrow.
8. Developer shall convey to the Agency the fee simple marketable title to
the Developer Parcel and the Improvements free and clear of title exceptions (all recorded or
unrecorded liens, encumbrances, covenants, conditions, restrictions, assessments, easements,
leases, taxes and other defects) except for the Senior Loan Documents and other documents
recorded in connection with the Construction Financing Event and such other title exceptions as
are expressly approved by the Agency. Any other title exceptions shall be cleared by Developer.
9. Taxes and assessments shall be prorated to the close of escrow.
10. All funds received in the escrow shall be deposited by the Option Escrow
Agent in an interest bearing account as directed by the depositing party.
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11. Upon Developer’s delivery to the Option Escrow Agent of the grant deed
and bill of sale for the Improvements, and the Agency’s delivery to the Option Escrow Agent of
the Option Price the Option Escrow Agent shall record the grant deed when the fee simple title to
the Developer Parcel and the Improvements can be vested in the Agency in accordance with the
terms and provisions of this Agreement. The Option Escrow Agent shall buy, affix and cancel
any transfer stamps required by law.
12. If the escrow is not in condition to close on or before the time established
therefor in this Agreement, either party who then shall have fully performed the acts to be
performed before the close of escrow may, in writing, demand the return of its money, papers or
documents. No demand for return shall be recognized until ten (10) days after the Option
Escrow Agent shall have mailed copies of such demand to the other party at the address of its
principal place of business. Objections, if any, shall be raised by written notice to the Option
Escrow Agent and to the other party within the ten (10) -day period. If any objections are raised
within the ten (10) -day period, the Option Escrow Agent is authorized to hold the money, paper
and documents until instructed by mutual agreement of the parties or, upon failure thereof, by a
court of competent jurisdiction. If no such demands are made, the escrow shall be closed as soon
as possible.
13. The Option Escrow Agent shall not be obligated to return any such
money, papers or documents except upon the written instructions of both Developer and the
Agency, or until the party entitled thereto has been determined by a final decision of a court of
competent jurisdiction.
14. Any amendments to these escrow instructions shall be in writing and
signed by both Developer and the Agency. At the time of any amendment the Option Escrow
Agent shall agree to carry out its duties as escrow agent under such amendment.
15. The liability of the Option Escrow Agent under this Agreement is limited to
performance of the obligations imposed upon it under this Section 611.
Section 612 Limited Recourse Obligations
(a) Each obligation of the Developer under this Agreement is a nonrecourse
obligation of the Developer and Developer’s partners. Except as provided otherwise in this
Agreement, neither the Developer nor any of its general or limited partners, nor any other party,
shall have any personal liability for payment of obligations to the Agency. The sole recourse of
the Agency shall be the exercise of its rights against the Site and the Project and any related
security for the Agency Loan.
(b) Notwithstanding the foregoing, Agency may obtain a judgment or order
(including, without limitation, an injunction) requiring Developer or any other party to perform
(or refrain from) specified acts other than repayment of the Agency Loan; may proceed against
any person or entity whatsoever with respect to the enforcement of any performance or
completion guarantees or similar rights to performance; and may recover directly from
Developer or any other party:
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1. any damages, costs and expenses incurred by Agency as a result of fraud
or any criminal act or acts of Developer or any partner, shareholder, officer, director or employee
(acting within the scope of his or her employment) of Developer or of any of Developer’s
general partners;
2. any damages, costs and expenses incurred by Agency as a result of any
misappropriation of funds provided for the development of the Project, as described in this
Agreement, rents and revenues from the operation of the Project, or proceeds of insurance
policies or condemnation proceeds;
3. any and all amounts owing by Developer pursuant to Developer’s
indemnification regarding Hazardous Substances; and
4. all court costs and attorneys’ fees reasonably incurred in enforcing or
collecting upon any of the foregoing exceptions.
Section 613 Litigation Costs.
If litigation arises out of this Agreement for the performance thereof, then the court shall
award costs and expenses, including attorney’s fees, to the prevailing party. In awarding
attorney’s fees, the court shall not be bound by any court fee schedule but shall award the full
amount of costs, expenses and attorney’s fees paid or incurred in good faith.
ARTICLE VII GENERAL PROVISIONS
Section 701 Developer’s Warranties.
Developer represents and warrants (1) that it has access to professional advice and
support to the extent necessary to enable Developer to fully comply with the terms of this DDA;
(2) that it and its partners are duly organized, validly existing and in good standing under the
laws of the State of California; (3) that it has the full power and authority to undertake the
Project and to execute this DDA; (4) that the persons executing and delivering this DDA are
authorized to execute and deliver such documents on behalf of Developer; (5) except as
disclosed to the Agency in writing, there are no actions or proceedings pending or, to the best of
the Developer’s knowledge, threatened against the Developer or Developer’s members before
any court or administrative agency in any way connected with the Site or the Project which could
adversely affect the Developer’s ability to perform the activities contemplated hereunder; (6)
neither this DDA nor anything provided to be done hereunder violates or shall violate any
contract, agreement or instrument to which the Developer or a member of Developer is a party or
which affects the Project or any part thereof; (7) the Developer is not in default in respect of any
of its obligations or liabilities pertaining to this DDA, nor is there any state of facts or
circumstances or conditions or events which, after notice, lapse of time, or both, would constitute
or result in any such default under this DDA; and (8) neither the Developer nor its members has
entered into any agreements which will adversely affect the title to the Project or the Developer’s
right to develop and use the Project as provided in this DDA, and neither the Developer nor its
members will enter into any such agreements after the date hereof.
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Section 702 Notices, Demands and Communications between the Parties
Formal notices, demands, and communications between the Parties shall be sufficiently
given if: (i) personally delivered; (ii) delivered by same day or overnight courier (acknowledged
by receipt showing date and time of delivery); or (iii) dispatched by registered or certified mail,
postage prepaid, return receipt requested, to the addresses set forth below:
If to Developer: Tilden Terrace, L.P.
c/o Los Angeles Housing Partnership
1200 Wilshire Boulevard, Suite 307
Los Angeles, California 90017
Attn: Mary Silverstein, President and Executive Director
With a copy to:
Bocarsly Emden Cowan Esmail & Arndt LLP
633 West Fifth Street, 70th Floor
Los Angeles, California 90071
Attn: Kyle Arndt, Esq.
And a copy to:
Hudson Housing Capital, LLC
630 Fifth Avenue, 28
th
Floor
New York, New York 10111
Attn: Joseph A. Macari
If to Agency: Culver City Redevelopment Agency
9770 Culver Boulevard
Culver City, CA 90230-0507
Attn: Executive Director
With a copy to: City Attorney’s Office
City of Culver City
9770 Culver Boulevard
Culver City, CA 90230-0507
And a copy to: Kane, Ballmer & Berkman
515 S. Figueroa St., Suite 1850
Los Angeles, California 90071
Attn: Deborah Rhoads, Esq.
If to City: City of Culver City
9770 Culver Boulevard
Culver City, CA 90230-0507
Attn: City Manager
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With a copy to: City Attorney’s Office
City of Culver City
9770 Culver Boulevard
Culver City, CA 90230-0507
And a copy to: Kane, Ballmer & Berkman
515 S. Figueroa St., Suite 1850
Los Angeles, California 90071
Attn: Deborah Rhoads, Esq.
Notices personally delivered or delivered by courier shall be effective upon receipt or
refusal to accept delivery. Mailed notices shall be effective on the earlier of (i) receipt of refusal
to accept delivery, or (ii) noon on the second business day following deposit in the United States
mail.
Section 703 Conflicts of Interest
(a) No member, official or employee of the Agency or the City shall have any
personal interest, direct or indirect, in this DDA nor shall any such member, official or employee
participate in any decision relating to this DDA which affects his personal interests or the
interests of any corporation, partnership or association in which he is, directly or indirectly,
interested.
(b) The Developer warrants that it has not paid or given, and will not pay or give, any
third party any money or other consideration for obtaining this DDA.
Section 704 Nonliability of Agency and City Officials and Employees
No member, official, employee or consultant 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 that may become due to the Developer or to
its successor, or on any obligations under the terms of this DDA.
Section 705 Extension of Times of Performance
(a) In addition to the specific provisions of this DDA, performance by any party
hereunder shall not be deemed to be in default during a Force Majeure Event. An extension of
time for a Force Majeure Event shall be limited to the period of such event, and shall commence
to run from the time of the commencement of the cause, provided notice by the party claiming
such extension is sent to the other party within ten (10) business days of the commencement of
the cause. In the event of such delay, the party delayed shall continue to exercise reasonable
diligence to minimize the period of delay.
(b) Times of performance under this Agreement may also be extended by mutual
written agreement by the Agency and Developer.
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Section 706 Inspection of Books and Records
The Developer shall maintain at a location in Los Angeles County complete, accurate,
and current records pertaining to the Site and the Project for a period of five (5) years after the
creation of such records, and shall permit any duly authorized representative of the Agency to
inspect and copy records, during regular business hours. Records must be kept accurate and
current.
Section 707 Use of Project Images
Developer hereby consents to the use by Agency and City of images of the Project, its
models, plans and other graphical representations of the Project and its various elements
(“Project Images”) in connection with marketing, public relations, and special events, websites,
presentations, and other uses required by the Agency and/or City in connection with the Project.
Such right to use the Project Images shall not be assignable by the Agency or City to any other
party (including, without limitation, any private party) without the prior written consent of
Developer. For any Project Images provided to Agency and City by Developer, Developer shall
use reasonable efforts to obtain any rights and/or consents from any third parties necessary to
provide these Project Image use rights to Agency and City.
Section 708 Legal Incapacity of Agency
(a) By entering into the Cooperation Agreement and by effectuating a transfer to the
City of the Agency Parcel, the Redevelopment and Housing Funds and the Agency’s rights,
interests and obligations relating to the Commitment Letter and the Developer Option, it was the
intent of the Agency and the City, without the need for further Agency action, that if the Agency
is unable to perform its obligations under this DDA due to a dissolution of the Agency, a
suspension of its powers, or other legal incapacity, then the City shall perform all of the duties
and obligations that were to be performed by the Agency under this DDA and shall have the
benefit of all of the Agency’s rights, remedies and interests under this DDA; provided, however,
that nothing hereunder shall obligate the City to draw upon any funds other than the
Redevelopment and Housing Funds to satisfy such obligations of the Agency and provided
further, that nothing hereunder shall have the effect of relieving the Agency of any of its duties
and obligations hereunder and this DDA shall remain fully enforceable against the Agency and
its successors and assigns, whether voluntary or involuntary successors, or whether successors by
operation of law.
(b) So long as the Agency is able to perform its duties and obligations under this
DDA, the Agency and the City shall cooperate to take such actions and execute such documents
and instruments as are necessary and appropriate to reconvey from the City to the Agency those
assets previously held by the Agency, including but not necessarily limited to the Agency Parcel
and the Redevelopment and Housing Funds, at such times and in such amounts as are required
by the Agency to perform its obligations hereunder.
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(c) The Developer shall accept performance by the City of the Agency’s obligations
under this DDA. The Parties agree to take such actions and execute such documents and
instruments as are reasonably required to carry out the intent of this Section 708.
Section 709 Agency Indemnification of City
In contemplation of the provisions of California Government Code section 895.2
imposing certain tort liability jointly upon public entities solely by reason of such entities being
parties to an agreement as defined by Government Code section 895, the Agency and the City, as
between themselves, pursuant to the authorization contained in Government Code sections 895.4
and 895.6, shall each assume the full liability imposed upon it, or any of its officers, agents or
employees, by law for injury caused by negligent or wrongful acts or omissions occurring in the
performance of this Agreement to the same extent that such liability would be imposed in the
absence of Government Code section 895.2. Notwithstanding the foregoing, and to the fullest
extent allowed by law, the Agency, its successors and assigns, hereby indemnifies, defends and
holds harmless the City for any liability, losses, cost or expenses that may be incurred by the
City arising out of or related to this DDA and the Project.
Section 710 Action or Approval
(a) Whenever an administrative action is required by the Agency to implement the
terms of this DDA, the Agency Executive Director, or an authorized designee, shall have
authority to act on behalf of the Agency, except with respect to matters reserved under California
law wholly for determination by the Agency’s governing body. By way of example, the
Executive Director or designee shall have the authority to issue interpretations, waivers and/or
enter into certain implementing agreements to this Agreement on behalf of the Agency and such
interpretations, waivers and/or implementing agreements may include extensions of time to
perform as specified in the Schedule of Performance, Permitted Transfer of rights or obligations
of Developer, or Permitted Transfer of Developer’s interest in the Project, subordination
agreements or estoppels in a form acceptable to the Agency Executive Director or designee to
evidence that the Agency Loan is subordinate to the Senior Loan, and other documents in
accordance with this Agreement, as reasonably requested by the Investor Limited Partner or the
Senior Lender in order to effect a closing of the financing of the Project.
(b) Whenever an administrative action is required by the City to implement the terms
of this DDA, the City Manager, or an authorized designee, shall have authority to act on behalf
of the City, except with respect to matters reserved under California law wholly for
determination by the City Council of the City of Culver City. By way of example, the City
Manager or designee shall have the authority to issue interpretations, waivers and/or enter into
certain implementing agreements to this Agreement on behalf of the City and such
interpretations, waivers and/or implementing agreements may include extensions of time to
perform as specified in the Schedule of Performance, Permitted Transfer of rights or obligations
of Developer, or Permitted Transfer of Developer’s interest in the Project, subordination
agreements or estoppels in a form acceptable to the City Manager or designee to evidence that
the Agency Loan is subordinate to the Senior Loan, and other documents in accordance with this
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Agreement, as reasonably requested by the Investor Limited Partner or the Senior Lender in
order to effect a closing of the financing of the Project.
Section 711 Assurances to Act in Good Faith
Developer, the City and the Agency agree to execute all documents and instruments and
to take all action, including timely depositing funds as required hereby, and shall use their
respective best efforts to accomplish the development of the Site in accordance with the
provisions hereof. Approvals required of the Agency, the City or the Developer shall not be
unreasonably withheld. Any reference in this Agreement or the Residential Loan Documents or
the Commercial Loan Documents to an action, approval, or consent on the part of the Agency,
the City or Developer shall require such party to act reasonably in all respects except as
otherwise expressly provided.
Section 712 Real Estate Commissions
Neither the Agency, the City nor the Developer shall be liable for any real estate
commissions, brokerage fees or finders fees which may arise from this transaction. The Agency,
the City and the Developer each represent to the other that it has employed no broker, agent, or
finder in connection with this transaction, except as set forth in Section 315 of this Agreement.
Section 713 Interpretation
This Agreement is in all respects intended by each Party hereto to be deemed and
construed to have been jointly prepared by the Parties. The terms of this DDA shall be construed
in accordance with the meaning of the language used and shall not be construed for or against
any party by reason of the authorship of this DDA or any other rule of construction which might
otherwise apply.
Section 714 Severability
If any provision of this DDA shall be adjudged invalid, illegal or unenforceable by a
court of competent jurisdiction, the remaining provisions of this DDA shall not be affected
thereby, but this DDA shall be construed as if such invalid, illegal or unenforceable provisions
had not been contained herein, and the remainder of this DDA shall be valid and enforceable to
the fullest extent permitted by law.
Section 715 No Third Party Beneficiaries
This DDA is made solely and specifically between the Agency, the City and Developer
and their respective successors and assigns; and, except as expressly provided otherwise in this
DDA, no other person will have any rights, interest or claims under this DDA or be entitled to
any benefits under or on account of this DDA as a third party beneficiary or otherwise.
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Section 716 Authority to Sign
Developer hereby represents that the person executing this DDA on behalf of Developer
has full authority to do so and to bind Developer to perform pursuant to the terms and conditions
of this DDA.
Section 717 Titles and Captions.
Titles and captions are for convenience only and shall not be construed to limit or extend
the meaning of this Agreement.
Section 718 Gender and Number.
As used in this Agreement, masculine, feminine or neuter gender and the singular or
plural number shall each be deemed to include the others wherever and whenever the context so
dictates.
ARTICLE VIII ENTIRE AGREEMENT, WAIVERS AND AMENDMENTS
(a) This DDA shall be executed in three duplicate originals each of which is deemed
to be an original. This DDA and its attached Exhibits shall constitute the entire understanding
and agreement of the parties.
(b) This DDA integrates all of the terms and conditions mentioned herein or
incidental hereto, and supersedes all negotiations or previous agreements between the parties
with respect to all (or any part of or any interest in) the Site. This DDA and all documents
incorporated herein contain the entire understanding among the parties hereto relating to the
transactions contemplated herein and all prior or contemporaneous agreements, understandings,
representations, and statements, oral or written.
(c) All waivers of the provisions of this DDA must be in writing and signed by the
appropriate authorities of the Party intended to receive the benefit of the provision being waived,
and all amendments hereto must be in writing and signed by the appropriate authorities of the
parties to be bound thereby. This DDA and any provisions hereof may be amended by mutual
written agreement by the Developer and, as applicable, the Agency Executive Director and/or the
City Manager, subject to review and approval by the Agency Board and/or City Council as
needed to comply with applicable law and internal policies and procedures. The waiver by any
Party of any term, covenant, or condition herein contained shall not be a waiver of such term,
covenant, or condition on any subsequent breach.
(d) This DDA may be executed in any number of counterparts, each of which, when
so executed and delivered, shall be an original, but all of which together shall constitute one
agreement binding on the Agency, the City and the Developer.
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ARTICLE IX TIME FOR ACCEPTANCE OF AGREEMENT BY THE AGENCY; DATE OF
AGREEMENT
(a) This DDA does not take effect until executed by the Developer, the City and the
Agency. This DDA, when executed by the Developer and delivered to the Agency and the City,
must be authorized, executed and delivered by the Agency and the City within thirty (60) days
after the date of signature by the Developer, or the Developer shall have the right to withdraw its
offer to enter into this DDA by providing written notice to the Agency and the City. This
DDA shall not be effective until executed by the Agency Executive Director and the City
Manager.
[Remainder of Page Intentionally Left Blank]
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(b) The Agency Executive Director is authorized to take such other and further
actions, and sign such other and further agreements and documents on behalf of the Agency as
may be necessary or proper to effect the terms of this DDA.
IN WITNESS WHEREOF, the parties hereto have entered into this Agreement as of the
Effective Date.
“DEVELOPER”
TILDEN TERRACE, L.P.,
a California limited partnership
By: Los Angeles Housing Partnership, Inc.,
a California nonprofit public benefit
corporation
Its: Managing General Partner
By: _________________________
Mary Silverstein
Its: President and Executive Director
“AGENCY”
CULVER CITY REDEVELOPMENT
AGENCY, a public body corporate and politic
By: _________________________________
John M. Nachbar
Executive Director
ATTEST:
By: _________________________________
Agency Secretary
APPROVED AS TO FORM:
By: _________________________________
General Counsel
By: _________________________________
KANE, BALLMER & BERKMAN
Agency Special Counsel
[Signatures Continue on Following Page]
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“CITY”
THE CITY OF CULVER CITY,
a charter city of the State of California
By: _________________________________
John M. Nachbar
City Manager
ATTEST:
By: _________________________________
City Clerk
APPROVED AS TO FORM:
By: _________________________________
KANE, BALLMER & BERKMAN
City Attorney
ATTACHMENT 3
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Exhibit “B”
Legal Description
of the Agency Property
EXHIBIT NO. 1-A
LEGAL DESCRIPTION OF
THE DEVELOPER PARCEL
ALL THAT CERTAIN REAL PROPERTY SITUATED IN THE COUNTY OF LOS
ANGELES, STATE OF CALIFORNIA, DESCRIBED AS FOLLOWS:
LOTS 1 AND 2 OF TRACT NO. 9648, IN THE CITY OF CULVER CITY COUNTY
OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK
142, PAGES 13, 14 AND 15 OF MAPS, IN THE OFFICE OF THE COUNTY
RECORDER OF SAID COUNTY.
Assessor’s Parcel Number: 4213-007-001
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Exhibit “B”
Legal Description
of the Agency Property
EXHIBIT NO. 1-B
LEGAL DESCRIPTION OF
THE AGENCY PARCEL
ALL THAT CERTAIN REAL PROPERTY SITUATED IN THE COUNTY OF LOS
ANGELES, STATE OF CALIFORNIA, DESCRIBED AS FOLLOWS:
LOTS 4, 5, 6, 7 AND 8 OF TRACT NO. 9648, IN THE CITY OF CULVER CITY,
COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP
RECORDED IN BOOK 142, PAGES(S) 13 TO 15 INCLUSIVE OF MAPS, IN THE
OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
And
LOT 3 OF TRACT 9648, AS SHOWN ON A MAP RECORDED IN BOOK 142,
PAGES 13, INCLUSIVE OF MISCELLANEOUS MAPS, RECORDS OF LOS
ANGELES COUNTY, CALIFORNIA.
APN: 4213-007-900, 4213-007-901
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Exhibit “B”
Legal Description
of the Agency Property
EXHIBIT NO. 1-C
LEGAL DESCRIPTION OF
THE DEVELOPMENT SITE
ALL THAT CERTAIN REAL PROPERTY SITUATED IN THE COUNTY OF LOS
ANGELES, STATE OF CALIFORNIA, DESCRIBED AS FOLLOWS:
LOTS 1 AND 2 OF TRACT NO. 9648, IN THE CITY OF CULVER CITY COUNTY
OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK
142, PAGES 13, 14 AND 15 OF MAPS, IN THE OFFICE OF THE COUNTY
RECORDER OF SAID COUNTY
And
LOT 3 OF TRACT 9648, AS SHOWN ON A MAP RECORDED IN BOOK 142,
PAGES 13, INCLUSIVE OF MISCELLANEOUS MAPS, RECORDS OF LOS
ANGELES COUNTY, CALIFORNIA
And
LOTS 4, 5, 6, 7 AND 8 OF TRACT NO. 9648, IN THE CITY OF CULVER CITY,
COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP
RECORDED IN BOOK 142, PAGES(S) 13 TO 15 INCLUSIVE OF MAPS, IN THE
OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
APN: 4213-007-001, 4213-007-901, 4213-007-900
ATTACHMENT 3
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Exhibit “C”
Map of the Site
EXHIBIT NO. 2
MAP OF THE DEVELOPMENT SITE
ATTACHMENT 3
84EXHIBIT NO. 3
METHOD OF FINANCING
This is the Method of Financing attached to the Disposition and Development Agreement (the
“DDA”) between the Culver City Redevelopment Agency (the “Agency”), the City of Culver City
(the “City”) and Tilden Terrace, L.P. (“Developer”), relating to Developer’s acquisition of the Site
and development of a 33-unit multifamily housing project (including one manager’s unit and
approximately 10,700 square feet of commercial space), to be rented, at Affordable Rents, to Very
Low Income and Low Income Households. Any capitalized term not otherwise defined herein shall
have the meaning ascribed to it in the DDA.
The Project will be financed by a combination of the Residential Loan, the Commercial Loan, the
Senior Loan and Developer Equity derived in part from the syndication of the Nine Percent Tax
Credits. The Residential Loan will be used to fund Developer’ Acquisition Costs for the Site in the
approximate amount of $5,100,000, with the balance of the Residential Loan used to fund Project
development costs during the Construction Period.
1. Total Project Cost. The parties estimate that the total Project Costs shall be
approximately $23,986,500. Developer acknowledges that the Agency is relying on Developer’s
experience and expertise in establishing the Project Costs and Developer represents that the Project
Budget is based on the best, good faith estimate of the Developer of the costs that are likely to be
incurred for the Project.
3. Sources of Construction Financing. The parties anticipate that the Project Costs
shall be financed during the Construction Period with the following combinations of funds.
Developer must make every reasonable effort to structure the terms of the construction financing in a
way that will minimize the amount of the Residential Loan.
(a) Limited Partner Capital Contributions in the amount of $3,216,800 to be
disbursed in accordance with Developer’s Limited Partnership Agreement.
(b) The Construction Loan in the estimated amount of $4,177,217.
(c) The Residential Loan in the amount of $11,805,000.
(d) The Commercial Loan in the amount of $3,395,000.
(e) Costs deferred until completion in the amount of $132,483.
(f) Developer Equity consisting of (i) $0 in cash and (ii) the deferral of the
Developer Fee in the approximate amount of $1,260,000 (“Deferred
Developer Fee”), of which $560,000 will be paid to Developer at the
Permanent Financing Event and $700,000 will be paid to Developer to the
extent available from the gross cash flow of the Project or Cost Savings
pursuant to Section 13 of this Method of Financing. In addition, Developer
shall be responsible during the Construction Period to provide funds, if and
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as needed, to pay for any cost overruns not funded and contingencies not
otherwise funded by the sources of funds as described herein.
3. Sources of Permanent Financing. The parties anticipate that, after the Conversion
Date, the Project Costs shall be financed with the following combinations of funds. Developer must
make every reasonable effort to structure the terms of the permanent financing in a way that will
minimize the amount of the Agency Loan.
(a) The initial Limited Partner Capital Contribution referenced in paragraph 2(a)
above in the amount of $3,216,800.
(b) The Permanent Loan in the approximate original principal amount of
$1,798,790.
(c) The Residential Loan referenced in paragraph 2(c) above in the original
principal amount of $11,805,000. If actual Project Costs, as set forth in the
audited cost certification contained in the placed-in-service application
submitted by Developer to the California Tax Credit Allocation Committee
pursuant to Section 10322(i)(1) of Title 4 of the California Code of
Regulations, are less than the total Project Costs set forth in the most recently
approved Project Budget, the resulting cost savings shall be allocated to
reduce the principal amount of the Residential Loan in accordance with
Section 3(f) hereof.
(d) The Commercial Loan in the amount of $3,395,000.
(e) A “Deferred Developer Fee,” consisting of a portion of the fee payable to the
Developer’s Managing General Partner pursuant the Limited Partnership
Agreement, in an amount estimated to be $700,000. (The Deferred
Developer Fee is a Project Cost, payment of which will be deferred until
funds are available.)
(f) Developer Equity in the form of (i) $0 in cash and (ii) an additional Limited
Partner Capital Contribution, in the approximate amount of $2,740,910
(including that portion of the Limited Partner Capital Contribution that will
be funded upon receipt of Form(s) 8609), which amount may be adjusted
pursuant to the provisions and requirements of the federal Internal Revenue
Code, the TCAC Regulatory Agreement and the provisions of the Limited
Partnership Agreement and the Contribution Agreement. In the event the
Limited Partner Capital Contribution is less than anticipated, the amount of
the Deferred Developer Fee will be increased commensurately. In the event
the Limited Partner’s Capital Contribution, when added to the Permanent
Loan, the Residential Loan, the Commercial Loan and the Deferred
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Developer Fee, is greater than the amount need to pay the Project Costs, as
set forth in the audited cost certification contained in the placed-in-service
application submitted by Developer to the California Tax Credit Allocation
Committee pursuant to Section 10322(i)(1) of Title 4 of the California Code
of Regulations (“Placed-In-Service Application”), such funds shall be
applied to reduce the amount of the Residential Loan. Developer shall submit
to the Agency a copy of the Placed-In-Service Application, which must
include a certification of the amount of tax credit equity raised and the
syndication costs.
(g) A conditional grant or loan for the Project in the approximate amount of
$330,000 awarded to Developer by a member bank of the Federal Home
Loan Bank under the Federal Home Loan Bank Affordable Housing Program
(the “AHP Loan”), which shall be subject to terms and conditions that are
approved by the Agency Executive Director or designee.
4. Project Budget. The parties anticipate that all Project Costs shall be as set forth in
the Project Budget attached to the DDA as Exhibit No. “6”. The Project Budget shall be subject to
change from time-to-time, subject to the prior written approval of the Agency Executive Director or
designee (which approval shall not be unreasonably withheld or delayed), upon which approval the
Project Budget shall be replaced by the approved revised Project Budget. Within the respective
times provided therefor in the Schedule of Performance, the Developer shall demonstrate to the
satisfaction of the Agency Executive Director that the Senior Loan and all Developer Equity will be
available for payment or refinancing of Project Costs when and as required by this Method of
Financing. The amounts set forth in Sections 2 and 3 hereof (excluding the Residential Loan and the
Commercial Loan) are subject to modification pursuant to the final approved Project Budget, which
may reflect additional sources of funding subject to terms and conditions that are approved by the
Agency Executive director or designee.
5. Evidence of Financing. The sum of the Construction Loan plus the Residential Loan
plus the Commercial Loan plus the Developer’s Equity plus Deferred Developer Fee, as provided in
Sections 2 and 3 above, shall, at all times, be sufficient to pay all Project Costs as set forth in the
most recently approved Project Budget. Prior to the Construction Financing Event, Developer shall
submit for Agency review and approval evidence of such financing, including: (a) copies of all loan
documents required by the Construction Lender to obtain the Construction Loan; (b) the Limited
Partnership Agreement and other documentation evidencing the availability of the Developer Equity,
including the Limited Partner Capital Contribution; (c) a firm and binding commitment from the
Permanent Lender to provide the Permanent Loan; and, (c) any other documents reasonably required
by the Agency. The Agency shall not unreasonably withhold its approval of the Developer’s
evidence of financing.
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6. Residential Loan.
(a) In accordance with and subject to the terms and conditions of the DDA and
this Method of Financing, the Agency agrees to make the Residential Loan to Developer and
Developer agrees to borrow such funds for the purpose of payment of Project Costs.
(b) The Developer hereby acknowledges that the Residential Loan is intended to
be “gap” financing, not to exceed the amount needed to bridge the gap between the total Project
Costs and the maximum Senior Loan obtainable by Developer plus the maximum amount of
Developer’s Equity set forth above, but in any event not to exceed the respective dollar amounts of
the Residential Loan set forth above. Developer shall use all commercially reasonable efforts to
maximize the amount of the Senior Loan and the Limited Partner Capital Contribution that will be
available for the payment of Project Costs.
(c) The Residential Loan shall be used exclusively to pay Project Costs identified
in the Project Budget.
(d) At the Construction Financing Event, the Agency and the Developer shall
execute and deliver such instruments and documents as may be necessary to evidence and secure the
affordability restrictions on the Site and to evidence and secure the Residential Loan, consistent with
the terms of the DDA and this Method of Financing, and each in a form that is acceptable to the
Agency, including the following:
(1) the Grant Deed;
(2) the Agreement Containing Covenants;
(3) the Notice of Affordability Restrictions;
(4) the Residential Note;
(5) the Deed of Trust securing the Residential Loan;
(6) the Assignment of Rents and Leases;
(7) the Assignment of Agreements;
(8) the Environmental Indemnity; and
(9) the UCC1 Financing Statement.
.
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7. Commercial Loan.
(a) In accordance with and subject to the terms and conditions of the DDA and
this Method of Financing, the Agency agrees to make the Commercial Loan to Developer and
Developer agrees to accept such funds for the purpose of payment of Project Costs.
(b) The Commercial Loan shall be used exclusively to pay Project Costs
identified in the Project Budget.
(c) At the Construction Financing Event, the Agency and the Developer shall
execute and deliver such instruments and documents as may be necessary to evidence and secure the
Commercial Loan, consistent with the terms of the DDA and this Method of Financing, and each in
a form that is acceptable to the Agency, including the following:
(1) the Commercial Note;
(2) the Deed of Trust securing the Commercial Loan;
(3) the Assignment of Rents and Leases;
(4) the Assignment of Agreements;
(5) the Environmental Indemnity; and
(6) the UCC1 Financing Statement.
8. Subordination. The Agreement Containing Covenants shall unconditionally be and
at all times remain prior and superior to the lien created by the Senior Deed of Trust and any other of
the Senior Loan Documents and all of the terms and conditions contained in the Senior Loan
Documents. However, the Agency shall subordinate the Residential Loan Documents, the
Commercial Loan Documents and the obligations contained in Sections 2.1, 2.2 and 2.3 of the
Agreement Containing Covenants to the lien created by the Senior Deed of Trust and any other of
the Senior Loan Documents and all of the terms and conditions contained in the Senior Loan
Documents.
If Developer demonstrates to the reasonable satisfaction of the Agency Executive Director or
designee that Developer will be unable to obtain the Construction Loan and/or the Permanent Loan
without a modification of the affordability restrictions upon a foreclosure, then the Agency
Executive Director or designee may allow the income and rent restrictions on the 30% and 40% tax
credit units to float upward upon a foreclosure of the Senior Loan to the income and rent restrictions
that apply to Very Low Income Units under Community Redevelopment Law.
Subject to the terms and conditions of this Section 7, prior to the Construction Financing
Event, the Agency shall execute subordination agreements to, among other things, subordinate the
Residential Loan Documents and the Commercial Loan Documents to the Senior Deed of Trust and
other Senior Loan Documents, provided, however, that such subordination agreements must contain
provisions reasonably satisfactory to the Agency to protect the Agency’s investment in the event of
default.
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9. Recordation. Upon the Construction Financing Event, the Title Company shall
record the Grant Deed, the Agreement Containing Covenants, the Senior Loan Documents, the
Commercial Loan Documents and the Residential Loan Documents in accordance with instructions
provided by the Agency, the Construction Lender and the Developer, and shall be prepared to issue
to the Agency and ALTA lenders policy of title insurance, insuring the priority of the Residential
Deed of Trust and the Commercial Deed of Trust in amounts and with endorsements as the Agency
may require.
10. Agency’s Conditions Precedent to Construction Financing Event.
(a) The Agency’s obligation to fund the Residential Loan and the Commercial
Loan and convey title to the Agency Parcel shall be conditioned and contingent upon satisfaction or
Agency’s waiver of each of the following conditions precedent (collectively, the “Agency’s
Conditions to Closing”):
(i) Developer submits and the Agency approves evidence that the final
working drawings have been approved by the City, and, to the extent
required by the DDA, by the Agency;
(ii) Developer submits and the Agency approves the final bid set for
construction of the Project;
(iii) Developer submits and the Agency approves a copy of the fully
executed general construction contract with a licensed general
contractor, covering all construction work required by the DDA and
the approved final working drawings;
(iv) Developer submits and the Agency approves the payment and
performance bonds required by the Construction Lender, which must
name the Agency and the City as additional obligees;
(v) Developer delivers to the Agency and the Agency approves the
asbestos and lead survey required by Section 417 of the DDA.
(vi) Developer submits and the Agency approves a final Project Budget,
current as of the Construction Financing Event, demonstrating to the
satisfaction of the Agency the availability of sufficient funds to pay
all Project Costs;
(vii) Developer submits evidence satisfactory to the Agency that
Developer has satisfied all conditions precedent to the issuance of all
ATTACHMENT 3
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Permits necessary for the Project, other than payment of fees (for
which funds have been budgeted in the Project Budget);
(viii) Developer submits and the Agency approves the Maintenance
Program, including the Maintenance Budget, as required by the
DDA;
(ix) Developer submits and the Agency approves the Annual Project
Budget for the first year of operation, as required by the DDA;
(x) Developer submits and the Agency approves the Management Plan,
as required by the DDA;
(xi) Developer, Senior Lender and the Agency enter into a Disbursement
Agreement, consistent with the terms of this Method of Financing,
setting forth the timing and conditions of the disbursement of the
Developer Equity, the Senior Loan, the Residential Loan and the
Commercial Loan;
(xii) Title Insurance Company is prepared to issue the title insurance
policy required by the Agency;
(xiii) Developer submits to the Agency and the Agency approves the
certificates of insurance and endorsements showing that Developer
has obtained the insurance policies required by the DDA;
(xiv) Developer deposits with the Escrow Agent all of the funds and duly
executed instruments required of it by the DDA and this Method of
Financing to close the Escrow;
(xv) Developer delivers to the Agency and the Agency approves the final
Construction Loan Documents;
(xvi) Developer delivers to the Agency and the Agency approves the
Amended and Restated Limited Partnership Agreement;
(xvii) Developer delivers to the Agency and the Agency approves the
conveyance instrument for conveyance of the Developer Parcel from
Los Angeles Housing Partnership, Inc. to Developer, which
conveyance shall occur at the Construction Financing Event;
(xviii) Developer delivers to the Agency and the Agency approves
documentary evidence that Developer is in current good standing and
ATTACHMENT 3
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METHOD OF FINANCING
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is duly authorized to execute the Residential Loan Documents and the
Commercial Loan Documents and implement the DDA;
(xix) Developer is in full compliance with the terms and conditions of the
DDA and all documents and instruments referred to therein or
executed by Developer in furtherance of the DDA and all
representations and warranties of Developer contained therein shall
be true and correct in all material respects;
(xx) No litigation shall be threatened or pending which seeks to prevent
the construction or operation of the Project, or any part thereof,
according to the terms set forth in the DDA.
In the event any of the Agency’s Conditions to Closing are not satisfied (or waived by the Agency)
by the date set forth in the Schedule of Performance for the occurrence of the Construction
Financing Event, the Agency may cancel the Escrow and terminate the DDA by delivering ten (10)
days prior written notice to Developer and the Escrow Agent. Developer may nullify the notice to
terminate if, within such ten (10) day period Developer (at no cost to the Agency) cures any
unsatisfied Conditions to Closing and notifies the Escrow Agent of such cure. In the event of
termination pursuant to this paragraph, (i) the Escrow shall be cancelled and any funds deposited by
the parties shall be returned to them with any interest earned on such funds; (ii) Developer shall be
responsible for any escrow cancellation fees imposed by the Escrow Agent; and (iii) the DDA shall
be terminated and the parties shall have no further rights or obligations thereunder.
(b) Waiver of Conditions Precedent. Notwithstanding the foregoing, the Agency,
in the sole discretion of the Agency Executive Director, may waive any of the foregoing conditions
precedent to the Agency’s Construction Financing Event. A waiver of any of the foregoing
conditions shall not operate in any way as a waiver, or estoppel with respect to, any subsequent or
other failure to comply with such condition, or any other condition contained in this Method of
Financing, the DDA or any of the Residential Loan Documents or Commercial Loan Documents.
11. Disbursement of Residential Loan and Commercial Loan.
(a) The Residential Loan and the Commercial Loan shall be disbursed for the payment of
Project Costs in accordance with a disbursement agreement and escrow instructions among the
Agency, Senior Lender and Developer that are consistent with the terms of this Method of Financing
and the DDA and are in form and substance that is mutually acceptable to the Agency Executive
Director or designee, the Developer and the Senior Lender (the “Disbursement Agreement”). The
Disbursement Agreement shall, among other things, set forth the Agency’s inspection rights,
approval rights over the use of the Project’s contingency allowance, and approval rights over change
orders, including the Agency’s control over approval of change orders and draw requests relating to
the Off-Site Improvements, and shall assure the Agency’s right to fully participate in monthly draw
meetings.
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(b) Disbursement of the Residential Loan shall occur as follows: First, $5,100,000 shall
be funded at the Construction Financing Event to pay Developer’s Acquisition Costs for the Site.
Next, a portion of the Residential Loan shall be disbursed to reimburse Developer for reasonable out
of pocket costs to bring the Leasing Office (the shell, electrical, plumbing and HVAC systems) into
conformity with the Culver City Building Code and to pay lease payments for the Leasing Office, in
amounts approved by the Agency and supported with reasonably detailed documentation. The
Commercial Loan and the undisbursed balance of the Residential Loan shall be deposited in a
segregated account to be held and disbursed by Construction Lender on a pari passu basis with the
Construction Loan, provided that, no portion of the Residential Loan or the Commercial Loan shall
be disbursed by Construction Lender until the Agency notifies Construction Lender that the
Agency’s conditions to disbursement set forth in the Disbursement Agreement have been satisfied or
waived, which shall include but not be limited to the Agency’s approval of the Developer’s draw
request. The Agency shall have no obligation to authorize disbursement during the Construction
Period of any portion of the Residential Loan or the Commercial Loan until the Land Loan has been
repaid in full and not less than 20% of the initial Limited Partner Capital Contribution described in
Section 2.(a) has been fully funded. Disbursement of the Commercial Loan and that portion of the
Residential Loan to be disbursed during the Construction Period shall each be subject to a ten
percent (10%) retention (provided, however, that predevelopment costs shall not be subject to
retention), which shall be released to Developer upon Completion of the Project, provided that, if the
reason for Developer not achieving Completion is confined to the immediate availability of specific
items or materials for landscaping, and/or minor items, the Agency will release the retention upon
the posting of a bond by Developer with the Agency in an amount representing the fair value of the
work not yet completed
12. Repayment Terms. The repayment terms of the Residential Loan and the
Commercial Loan shall be as set forth in the Residential Note and the Commercial Note,
respectively.
13. Distribution of Cost Savings and Solar Rebates
To induce Agency to make the Residential Loan, the Developer covenants and agrees as follows:
(a) Distribution of Cost Savings
If, on the date of the conversion of the Construction Loan to the Permanent Loan, the sum of
all Project Funds disbursed (as “Project Funds” is defined in the Disbursement Agreement), plus any
retention amounts then owing to contractors and others, plus any unpaid Project Costs set forth in
the most recent approved Project Budget (including paying down the Developer Fee to an amount
that is not less than $600,000) which the Agency and Construction Lender agree are to be disbursed
subsequent to the Completion date (such as, by way of example only and without limiting the
generality of the foregoing, costs associated with funding final Tax Credit Equity Investor capital
contributions) is less than $23,986,500 (the amount of such savings being referred to herein as the
“Cost Savings”), then to the extent of fifty percent (50%) of the Cost Savings, any undisbursed
ATTACHMENT 3
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METHOD OF FINANCING
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4 Method of Financing v6
amount of the Permanent Loan plus any undisbursed amount of the Residential Loan plus any
undisbursed amount of the Commercial Loan plus any undisbursed capital contributions by
Developer’s Limited Partner shall be released to the Agency.
(b) Distribution of Solar Rebates or Awards
It is the intent of the parties that if any additional funds beyond the amounts shown in the
Project Budget are obtained by the Developer as a benefit of the Project’s photovoltaic system, such
as solar rebates or an in-lieu grant pursuant to Section 1603 of the American Recovery and
Reinvestment Tax Act of 2009, then fifty percent (50%) of such funds shall be used to pay down the
Residential Loan after paying down the Developer Fee to an amount that is not less than $600,000.
ATTACHMENT 3
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SCHEDULE OF PERFORMANCE
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Tilden Terrace
5 Schedule of Performance v3
EXHIBIT NO. 4
SCHEDULE OF PERFORMANCE
ACTION ITEM TIME OF
PERFORMANCE
REFERENCE
1. Submittal - Basic Concept/Schematic
Drawings. Developer shall submit to
the Agency for approval the Basic
Concept/Schematic Drawings and
related documents.
Completed Section 403
2. Submittal – Nine Percent Tax Credit
Application. Developer shall submit to
the California Tax Credit Allocation
Committee its application for Nine
Percent Tax Credits for the Project and
shall submit a copy of its application to
the Agency.
Not later than the
CTCAC deadline for
submittal for the first
round of funding
(currently scheduled for
March 23, 2011)
Section 405
3. Developer Receives Nine Percent Tax
Credit Award. Developer shall receive
its preliminary reservation of Nine
Percent Tax Credits for the Project.
Not later than the
CTCAC meeting date for
the first round of funding
(currently scheduled for
June 8, 2011)
Section 405
4. Submittal - Final Construction
Drawings and Specifications and Bid
Set. Developer shall prepare and
submit to the Agency for approval the
Final Construction Drawings and
Specifications and the Bid Set for the
Project.
At least thirty (30) days
prior to the Construction
Financing Event.
Section 403
5. Submittal - Management Plan.
Developer shall submit to the Agency
for approval the proposed Management
Plan.
At least thirty (30) days
prior to the Construction
Financing Event.
Section 504 and
Section 4.4 of the
Agreement
Containing
Covenants
ATTACHMENT 3
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SCHEDULE OF PERFORMANCE
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5 Schedule of Performance v3
6. Submittal - Annual Project Budget.
Developer shall submit to the Agency
for approval the proposed Annual
Project Budget for the first year of
operation.
At least thirty (30) days
prior to the Construction
Financing Event.
Section 504 and
Section 4.4 of
Agreement
Containing
Covenants
7. Submittal – Maintenance Program.
Developer shall submit to the Agency
for approval the proposed Maintenance
Program for the Project.
At least thirty (30) days
prior to the Construction
Financing Event.
Section 505
8. Submittal - Evidence of Financing. The
Developer shall submit to the Agency
final Construction Loan Documents
and documentation of Developer
Equity, as provided in the Method of
Financing.
Not later than fifteen (15)
days prior to the
scheduled date for the
Construction Financing
Event.
Section 5 of Method
of Financing
9. Deposits Into Escrow. The Developer,
and Agency shall execute documents
and deposit documents and funds into
Escrow as provided in the Method of
Financing.
Not later than twelve
noon on the business day
immediately prior to the
scheduled Construction
Financing Event.
Section 307 and
Section 10 of the
Method of Financing
10. Construction Financing Event. All
conditions precedent to the
Construction Financing Event shall
have been satisfied.
Not later than the
deadline imposed by the
California Tax Credit
Allocation Committee.
Section 10 of
Method of Financing
11. Commencement of Construction of the
Project. The Developer shall
commence construction of the Project.
Within thirty (30) days
after the Construction
Financing Event.
Section 406
12. Completion of Construction of the
Project. The Developer shall achieve
Completion of construction of the
Project.
Not later than eighteen
(18) months following
commencement of
construction.
Section 406
13.
Submittal - Tenant Lease. The
Developer shall prepare and submit to
the Agency for approval the proposed
tenant lease for the Affordable Units as
provided in the Agreement Containing
Covenants.
Within thirty (30) days
prior to initial occupancy.
Sections 2.8 and 4.4
of Agreement
Containing
Covenants
ATTACHMENT 3
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5 Schedule of Performance v3
14. Submittal – Annual Reports. The
Developer submits annual financial
statements and rent records/tenant
eligibility certifications to the Agency.
Within one hundred
twenty (120) days after
the end of each calendar
year.
Section 4.3 of
Agreement
Containing
Covenants
NOTES:
This Schedule of Performance is subject to all of the terms and conditions of the text of the Housing
Agreement. The summary of the items in this Schedule of Performance is not intended to supersede or
modify the more complete description in the text; in the event of any conflict or inconsistency between
this Schedule of Performance and the text of the Housing Agreement, the text shall govern.
The time periods set forth in this Schedule of Performance may be altered or amended only by written
agreement signed by the Developer and the Agency. The Agency Executive Director shall have the
authority to approve extensions of time without action of the Agency’s governing board, not to exceed
a cumulative total extension of one (1) year.
ATTACHMENT 3
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SCOPE OF DEVELOPMENT
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|1010|EXHIBIT NO. 5
SCOPE OF DEVELOPMENT
This is the Scope of Development attached to the Disposition and Development
Agreement (“DDA”) by and between the Culver City Redevelopment Agency (“Agency”) and
Tilden Terrace, LP (“Developer”). Any capitalized term not otherwise defined herein shall have
the meaning ascribed to such term in the DDA.
The Property is located at 11042-52, 11054 and 11056 W. Washington Boulevard, Culver
City, California 90232 (“Site”). Developer shall construct on the Site a high quality 48,525
square foot mixed-use, affordable housing project (the “Project”) and shall substantially conform
to the description herein, subject to final Planning Commission approvals:
IMPROVEMENTS
The Improvements shall be of high architectural quality, well landscaped, and effectively
and aesthetically designed in accordance with that certain set of conceptual plans provided by
Developer, dated February 23, 2011 (the “Conceptual Plans”), which Conceptual Plans are
hereby incorporated herein by reference and attached hereto as “Exhibit “A”.
The Improvements shall be constructed in accordance with all federal, state, and/or local
development regulations and/or agreements.
Size:
Site: 32,279 gross square feet
Commercial: 10,700 gross square feet
Residential: 38,895 gross square feet
Units: 2 one-bedroom units of 730 gross square feet each
19 two-bedroom units of 900 gross square feet each
12 three-bedroom units of 1,130 gross square feet each
Common space: 1,930 gross square feet
Common open space: 5,301 gross square feet
Landscape: 7,851 gross square feet
Parking spaces: Residential: 65 spaces
Commercial: 41 spaces
The above totals include 5 ADA spaces
Bicycle: 12 spaces
Height: 35 feet (40 feet at corner)
3 stories above grade, 1 level below grade
Setbacks: Front: 5 feet
Rear: 5 feet, 23 feet 6 inches at Tilden Ave. corner, 32 feet at upper floors
Sides: East 0-15 feet, West 0-19 feet
ATTACHMENT 3
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SCOPE OF DEVELOPMENT
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|1010|Description:
ON-SITE:
The project shall be designed to conform to all applicable provisions of the Mixed Use
Ordinance, Commercial General (CG) Zone, and all City development standards. The
building mass and scale shall be compatible with the adjacent residential uses to the south
and to provide a pedestrian oriented streetscape along Washington Boulevard. The building
shall cover approximately 60 percent of the site, with remainder of the site developed with
courtyard open space, landscaping or areas for parking and vehicular or pedestrian
circulation. The proposed building shall be well articulated and aesthetically engaging by
incorporating varying building heights, setbacks and design elements. The project’s
mechanical equipments and refuse containers shall be designed to be concealed from the
street, public places and neighboring properties.
Height. The proposed building shall be 3 stories, with the majority of the building at 35 feet
in height including portions beyond 35 feet from the abutting residential zone. The corner
portion of the building on the northeast side at Tilden Avenue and Washington Boulevard has
a design element comprising of a clerestory window for the two story cyber library and will
be 40 feet in height which isl under the 45 feet height limit for the portion of the building
setback 35 feet or greater from a R1 or R2 zone.
Setback. The building frontage at ground level along Washington Boulevard shall be setback
up to 5 feet, as allowed in the City’s mixed use ordinance to accommodate pedestrian
amenities such as landscaped planter areas, seating niches for tables and benches, and
building canopies to provide for an enhanced pedestrian friendly street edge. The Tilden
Avenue corner of the building shall be setback up to 15 feet to provide for an enhanced
pedestrian plaza area for utilization by commercial uses at the ground floor. The project shall
provide an additional 3 foot building setback along the rear alley beyond the required 2 feet,
for a total setback of 5 feet along the alley to allow the planting of a row of columnar type
trees that will create a significant landscaped buffer between the project and the residential
buildings behind the alley. Further, the project shall meet the requirements of the mixed use
development standards 60 degree clear zone setback adjacent to the abutting residential zone
resulting in the rear of the building being stepped back at the second level.
Architectural Design. The proposed project shall be an architecturally modern building
making use of a variety of building materials including, corten steel, aluminum framing,
glass store fronts, metal awnings, wood railings and stucco. The colors and materials shall be
neutral and shall not conflict with the character of the neighborhood. The building shall be
well articulated with the use of stepbacks, overhangs and canopies; substantial use of planter
areas and private balconies for residential uses on the second and third floors; and open
space/courtyard areas which provide visual interest to all four sides of the building.
Sustainability/Green Building Features. The project shall incorporate building design
standards to meet the U.S. Green Building Council (USGBC’s) Leadership in Energy and
Environmental Design (LEED) green building standards at the Silver certification level or
higher. Sustainable/green building elements shall include:
ATTACHMENT 3
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SCOPE OF DEVELOPMENT
Page 3
3/17/2011
|1010|
• Open Space Courtyards. The project includes two large interior central courtyards
totaling 4,440 square feet at the second floor of the building, creating an open-air passive
recreational area for residents. This courtyard will be landscaped to satisfy LEED
requirements, and will provide shaded areas equipped with benches and tables.
• Planters. Planters on the second and third floors shall receive storm water from the roof,
filtering and retaining the water before it is released into the City’s storm drainage
system. The filtration planter consists of a layer of pebbles and a growth medium over
filter fabric and gravel. The planters are proposed to help purify the water, reduce the
amount of water and slow the rate of water into the storm drain.
• Green Screens. At the back of the building, adjacent to the alley, vines will be planted
along a “green screen” (metal mesh with landscaping) located behind the 5 foot planter
area.
• Rooftop Community Garden. The project also offers an approximately 860 square foot
community garden on the rooftop of the building for the residents that serves as a water
reclamation system to irrigate landscaping and to contribute to sustainable building
features, attributable to LEED requirements.
• Solar Power. The project provides photovoltaic solar arrays of approximately 5,000
square feet in area which is estimated to generate 30 Kilowatts of power. This exceeds
the City’s minimum requirement of 4.8 Kilowatts for a building and project of this size.
The solar panels which are elevated from the roof also provide shade for the roof surface,
which in turn, cools the roof and spaces below.
• Natural Ventilation. Each residential unit will be strategically designed to maximize day
lighting as well as natural ventilation for a comfortable and healthy quality of life for
residents. The rooftop community garden, perimeter landscaped planters areas, the
interior courtyards and green screens are intended to provide ecological benefits such as
cooling and humidifying the surrounding air, retaining and reducing storm water run-off,
and improving the thermal insulation of the roof itself, thereby mitigating the effects of
“urban heat islands”.
Mixed Use Requirements. The project shall provide 10,700 square feet of commercial space
on the ground floor that meet the minimum depth and floor area as required by the mixed use
development standards. The commercial storefronts face Washington Boulevard and both the
Harter and Tilden Avenue corners with pedestrian access from the Washington Boulevard
sidewalk and from the surface level parking area.
Elevators located in the subterranean residential parking accessed off of Harter Avenue, or in
lobby areas off of the Tilden Avenue sidewalk entrance shall provide access to the residential
units. The project shall have separate driveways for the residential and commercial
components of the project. A driveway on Tilden Avenue leads to the surface level
commercial parking and a driveway on Harter Avenue leads to the subterranean residential
ATTACHMENT 3
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SCOPE OF DEVELOPMENT
Page 4
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|1010|parking. Access off of the alley is limited to four parking spaces designated for employee
parking. There shall be no project access off of Washington Boulevard.
Further compatibility shall be achieved through mixed use performance standards. These
standards require walls, floors, and ceilings to be insulated to protect the project’s residential
users from potential noise impacts created by the ground floor commercial uses. The
performance standards do not allow commercial uses to be operated in such a manner that
they produce noise and vibrations that are detrimental to both the residential and commercial
uses. Other aspects of the performance standards include security code access for elevators
or separate commercial and residential elevators, cross ventilation and high quality HVAC
systems for residential units, illumination of parking areas, residential protection from
commercial loading areas, and adequate sidewalk pedestrian lighting. All of these design
standards shall be incorporated into the project.
Parking. A total not less than 106 parking spaces shall be provided on site to meet the
Zoning Code required parking for both the residential and commercial components of the
project. A total of 72 spaces are required for the 33 residential units (1 each for the 2 one
bedroom units; 2 each for the 31 two bedroom units; and 8 residential guest parking spaces).
Thirty-four spaces are required for the commercial components of the project. The parking
for the residential component shall include 65 spaces (64 for the residential units and 1 guest
space) in the one-level subterranean garage and 41 spaces (7 residential guest and 34
commercial spaces) located on grade, immediately behind the commercial tenant spaces.
Handicap accessible parking shall be provided both at the surface level (4 spaces) and at the
subterranean level (1 space). Bicycle parking is also provided both on-site and along the
sidewalk.
Subject to City approval of an Administrative Modification, the required parking aisle width
of 27 may be reduced by 2 feet and instead provide for 25 feet at both the surface and the
subterranean parking levels. The reduction is to permit the landscape planter at the rear of
the property to be enlarged from 2 feet to 5 feet I width. The wider planter is necessary to
provide enhanced screening and privacy to the nearby residential areas behind the
development through the planting of columnar type trees.
OFF-SITE:
Median and Intersection Improvements.
• Parking shall be prohibited on the west side of Tilden Avenue, between the alley and
Washington Boulevard. The roadway shall be striped to create a twelve foot
unobstructed curbside driving lane and an eighteen foot northbound curb lane with
parking available on the east side of Tilden Avenue.
• The curb at the southwest corner of Tilden Avenue and Washington Boulevard shall
be reconstructed to provide a larger radius and minimize the impact of the existing
acute angle experienced by motorists eastbound on Washington Boulevard turning
onto Tilden Avenue.
ATTACHMENT 3
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SCOPE OF DEVELOPMENT
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|1010|• The signalized intersections shall be reconfigured to relocate the crosswalk across
Washington Boulevard closer to Tilden Avenue and implement pedestrian crossings
within a single phase in-lieu of the existing two phase pedestrian crossing.
• The existing raised median islands shall also be reconfigured to provide for more
vehicle storage area for east and west traffic on Washington Boulevard and
Washington Place within the multi-leg intersection. The street medians adjacent to the
project site shall also be improved with enhanced landscaping.
• In addition, two low volume left turn movements shall be eliminated to and from
Tilden Avenue north of Washington Place.
• New or relocated traffic signals shall be repositioned to augment their visibility for all
motorists that traverse the intersections and shall be constructed in conjunction with a
Traffic Signal/Intersection Reconfiguration Improvement Plan.
Streetscape Improvements. A new streetscape design for the portion of Washington
Boulevard between Harter Avenue and Tilden Avenue shall be incorporated into the Project.
The streetscape improvements shall include new street trees and other landscaping, new
concrete sidewalks, permeable paving and new street furniture (benches, trash receptacles,
and bicycle racks) that will provide visual uniformity and enhancements to the project’s
streetscape. The existing palm trees shall be removed and up to eleven new street trees
(seven trees along Washington Blvd., two trees on Harter Avenue and two trees on Tilden
Avenue) surrounded by tree wells and shrubs planted near the street trees will be installed.
Exact tree location is pending placement of traffic signal equipment. The street trees shall be
of a species that is broad spreading, pedestrian scaled, and shade providing; the trees shall be
installed approximately 30 feet apart. The preliminary landscape plan identifies the London
Plane tree (Platanus Acerfolia) as the street tree that best fits within this criterion.
Bus Shelter: The existing bus stop on Washington Boulevard in front of the project shall be
upgraded to include a bus shelter, a new bus bench, trash receptacle and bus stop sign/transit
information display. The Developer shall also pay a fee to the City towards the cost and
future installation of a real-time bus arrival information system.
ENVIRONMENTAL REVIEW
Developer shall be responsible for causing the preparation of all California
Environmental Quality Act (“CEQA”) documents necessary for the entitlements for the Project
and the development of the Improvements on the Site. The City shall be responsible for
certification of any CEQA documentation in connection with the approval of the Project.
Developer shall be responsible for the payment of all CEQA compliance costs and shall fully
comply with all mitigation measures set forth in the Project entitlements.
ATTACHMENT 3
103VARIES
36" to 67"
SEE CIVIL
PLAN
1'-6"
VARIES
7' TO 12'
R/W
CURB & GUTTER
18"
MIN.
6"
2'-8" 5'-4" 2'-8"
10'-8"
2%
MAX
2%
MAX
BENCH, SEE DETAIL
EX. PCC SIDEWALK
CURB & GUTTER
PERVIOUS CONCRETE
TREE WELL
ROOT BARRIER
TREE STAKING
PERVIOUS
CONCRETE
R/W
49"
6"
67"
126"
59"
INVERTED 'U' BICYCLE RACK.
SEE PLAN FOR LOCATIONS
LONDON PLANE TREE
ATTACHMENT 3
104ATTACHMENT 3
105ATTACHMENT 3
106ATTACHMENT 3
107WASHINGTON BOULEVARD ELEVATION
ALLEY ELEVATION
HARTER AVENUE ELEVATION TILDEN AVENUE ELEVATION
ATTACHMENT 3
108ATTACHMENT 3
109WASHINGTON BLVD.
ALLEY
HARTER AVE.
TILDEN AVE.
COMMERCIAL AND RESIDENTIAL
GUEST PARKING
UTIL.
TRANSFORMER
TRASH
COMMERCIAL
RESIDENTIAL
LOBBY
PLAZA
CAFE|1010|2 27 27 24 26 25
10
14
27
27
10
13 23
11 15
3 5 4 8
10
12
13
14
27
27
9 10 6|1010|KEY NOTES:
GROUND FLOOR LANDSCAPE PLAN
02/21/2011
1. WASHINGTON BLVD. STREETSCAPE IMPROVEMENTS (REFER TO DETAIL 2 SHEET L1.2)
2. CITY APPROVED STREET TREE - PLATANUS ACERFOLIA
3. CITY STANDARD STEEL BENCH (TYPICAL) (REFER TO DETAIL 4 SHEET L1.2)
4. CITY STANDARD PARKWAY PLANTING (REFER TO DETAIL 2 SHEET L1.2)
5. CAFE TABLES AND CHAIRS (OWNER PROVIDED)
6. PORTABLE PLANTERS, PLANTED WITH SHADE TOLERANT PLANT SPECIES
7. ENTRY PLAZA WITH STEEL BENCHES TO MATCH CITY STANDARD
8. CAST-IN-PLACE CONCRETE PAVING - SCORING PATTERN COORDINATES WITH WASHINGTON BLVD. STREETSCAPE IMPROVEMENTS.
9. RETAIL STOREFRONT
10. RESIDENTIAL ENTRY/ EXIT
11. RAISED STORMWATER MITIGATION PLANTER
12. RAISED PLANTER (TYPICAL)
13. ACCENT PLANTING
14. CONTINUATION OF RESIDENTIAL STREET PARKWAY
15. LANDSCAPE BUFFER WITH MEDIUM-SIZED COLUMNAR TREE AND UNDERSTORY PLANTING
16. RAISED BALCONY PLANTERS, PLANTED WITH CASCADING PLANT SPECIES
17. LOW CURBED PLANTER WITH MOUNDED SOIL
18. SMALL ACCENT TREE PLANTING (TYPICAL)
19. MEDIUM-SIZED CANOPY TREE PLANTING (TYPICAL)
20. FIXED BENCH SEATING (TYPICAL)
21. RESIDENTIAL BALCONY (TYPICAL)
22. DECORATIVE CONCRETE PAVING COLOR AND FINISH TBD
23. 6’ TO 8’ TALL OPEN-SLAT WOOD FENCE TRANSFORMER SCREEN
24. BIKE RACK (CULVER CITY STANDARD)
25. TRASH CONTAINER (CULVER CITY STANDARD) (REFER TO DETAIL 3 SHEET L1.2)
26. BUS SHELTER AND BENCH (CULVER CITY STANDARD)
27. STREET TREE PLANTED IN CITY STANDARD TREE WELL (PLATANUS ACERFOLIA)
(REFER TO DETAIL 2 SHEET L1.2)
L1.0
ATTACHMENT 3
110WASHINGTON BLVD.
ALLEY
HARTER AVE.
TILDEN AVE.
COMMUNITY
ROOM
LAUNDRY
PLAZA
COURTYARD
COURTYARD
CYBER
LIBRARY
16 15
11 20
19 12 12 20 22
21 21
21 21
16
17 18 22 17 11
SECOND FLOOR LANDSCAPE PLAN
02/21/2011
KEY NOTES:
L1.1
1. WASHINGTON BLVD. STREETSCAPE IMPROVEMENTS (REFER TO DETAIL 2 SHEET L1.2)
2. CITY APPROVED STREET TREE - PLATANUS ACERFOLIA
3. CITY STANDARD STEEL BENCH (TYPICAL) (REFER TO DETAIL 4 SHEET L1.2)
4. CITY STANDARD PARKWAY PLANTING (REFER TO DETAIL 2 SHEET L1.2)
5. CAFE TABLES AND CHAIRS (OWNER PROVIDED)
6. PORTABLE PLANTERS, PLANTED WITH SHADE TOLERANT PLANT SPECIES
7. ENTRY PLAZA WITH STEEL BENCHES TO MATCH CITY STANDARD
8. CAST-IN-PLACE CONCRETE PAVING - SCORING PATTERN COORDINATES WITH WASHINGTON BLVD. STREETSCAPE IMPROVEMENTS.
9. RETAIL STOREFRONT
10. RESIDENTIAL ENTRY/ EXIT
11. RAISED STORMWATER MITIGATION PLANTER
12. RAISED PLANTER (TYPICAL)
13. ACCENT PLANTING
14. CONTINUATION OF RESIDENTIAL STREET PARKWAY
15. LANDSCAPE BUFFER WITH MEDIUM-SIZED COLUMNAR TREE AND UNDERSTORY PLANTING
16. RAISED BALCONY PLANTERS, PLANTED WITH CASCADING PLANT SPECIES
17. LOW CURBED PLANTER WITH MOUNDED SOIL
18. SMALL ACCENT TREE PLANTING (TYPICAL)
19. MEDIUM-SIZED CANOPY TREE PLANTING (TYPICAL)
20. FIXED BENCH SEATING (TYPICAL)
21. RESIDENTIAL BALCONY (TYPICAL)
22. DECORATIVE CONCRETE PAVING COLOR AND FINISH TBD
23. 6’ TO 8’ TALL OPEN-SLAT WOOD FENCE TRANSFORMER SCREEN
24. BIKE RACK (CULVER CITY STANDARD)
25. TRASH CONTAINER (CULVER CITY STANDARD) (REFER TO DETAIL 3 SHEET L1.2)
26. BUS SHELTER AND BENCH (CULVER CITY STANDARD)
27. STREET TREE PLANTED IN CITY STANDARD TREE WELL (PLATANUS ACERFOLIA)
(REFER TO DETAIL 2 SHEET L1.2)
ATTACHMENT 3
111PRELIMINARY PLANT PALETTE
TREES Common Remarks
Acerpalmatum JapaneseMaple COURTYARD
Agonisflexuosa`Afterdark` BlackPeppermintTree COURTYARD
Arbutusx`Marina` ArbutusMulti Trunk COURTYARD
Cornusflorida EasternDogwood COURTYARD
Cotinuscoggygria`VelvetCloak` VelvetCloakSmokeTree COURTYARD
Dodonaeaviscosa`Purpurea` PurpleLeafedHopseedBush COURTYARD
SHRUBS Common Remarks
Bignoniacapreolata CrossVine COURTYARD
Carexmorrowii`IceDance` IceDanceJapaneseSedge COURTYARD
Carexmorrowii`Variegata` JapaneseSedge COURTYARD
Colocasiaesculenta`BlackMagic` BlackTaro COURTYARD
Daturawrightii SacredDatura COURTYARD
Euphorbiacharaciaswulfenii EvergreenSpurge COURTYARD
Helichrysumpetiolare`Limelight` LimelightLicoricePlant COURTYARD
Heucheravillosa`Brownies` CoralBells COURTYARD
Heucheravillosa`Caramel` CoralBells COURTYARD
Heucheravillosa`Citronelle` CoralBells COURTYARD
Heucheravillosa`Mocha` CoralBells COURTYARD
Heucheraxbrizoides`RaspberryRegal` CoralBells COURTYARD
Hostafluctuans`Variegated` VariegatedPlantainLily COURTYARD
Irispseudacorus`Variegata` VariegatedYellowFlag COURTYARD
Irissibirica SiberianIris COURTYARD
Libertiaperegrinans COURTYARD
Liriopedensiflora Lilyturf COURTYARD
Liriopemuscari LilyTurf COURTYARD
Liriopespicata CreepingLilyTurf COURTYARD
Loropetalumchinenserubrum`Razzleberri` RazzleberriFringeFlower COURTYARD
Lysimachianummularia`Aurea` GoldenCreepingJenny COURTYARD
Nephrolepisauriculata SwordFern COURTYARD
Philodendronxxanadu Philodendron COURTYARD
Rumohraadiantiformis LeatherLeafFern COURTYARD
Thunbergiagrandiflora SkyFlower COURTYARD
Tradescantiapallida`Purpurea` PurpleQueenSpiderwort COURTYARD
Tradescantiaspathacea`Tricolor` Moses In The Cradle COURTYARD
Vitextrifoliapurpurea SimpleleafChasteTree COURTYARD
xHeucherellax`Stoplight` StoplightFoamyBells COURTYARD
Aeoniumx`AliceKeckPark` Aeonium COURTYARD/PERIMETER
Asparagusdensiflorus COURTYARD/PERIMETER
Callistemonviminalis`LittleJohn` DwarfWeepingBottlebrush COURTYARD/PERIMETER
Carissamacrocarpa`GreenCarpet` GreenCarpetNatalPlum COURTYARD/PERIMETER
Chondropetalumtectorum CapeRush COURTYARD/PERIMETER
Crassulaovata LargeJadePlant COURTYARD/PERIMETER
Dietesbicolor FortnightLily COURTYARD/PERIMETER
Dymondiamargaretae Dymondia COURTYARD/PERIMETER
Echeveriax`Afterglow` AfterglowEcheveria COURTYARD/PERIMETER
Hebealbicans`RedEdge` Hebe COURTYARD/PERIMETER
Hebex`SilverDollar` Hebe COURTYARD/PERIMETER
Juncuspatens`Carman`sGrey` SpreadingRush COURTYARD/PERIMETER
Leymuscondensatus GiantWildRye COURTYARD/PERIMETER
Muhlenbergiarigens DeerGrass COURTYARD/PERIMETER
Phormiumcookianum VariegatedMountainFlax COURTYARD/PERIMETER
Phormiumtenax`ApricotQueen` NewZealandFlax COURTYARD/PERIMETER
Phormiumtenax`Fiesta` FiestaDwarfRedFlax COURTYARD/PERIMETER
Phormiumtenax`YellowWave` NewZealandFlax COURTYARD/PERIMETER
Phormiumtenax`YellowWave` NewZealandFlax COURTYARD/PERIMETER
Phormiumx`ChocolateBaby` NewZealandFlax COURTYARD/PERIMETER
Phormiumx`Jester` VariegatedMountainFlax COURTYARD/PERIMETER
Salviaclevelandii`WinifredGillman` ClevelandSage COURTYARD/PERIMETER
Salviaofficinalis GardenSage COURTYARD/PERIMETER
Sansevieriatrifasciata Sansevieria COURTYARD/PERIMETER
Sedumx`AutumnJoy` AutumnJoySedum COURTYARD/PERIMETER
Sedumx`PurpleEmperor` Stonecrop COURTYARD/PERIMETER
Sempervivumcalcareum`Giuseppi` Mrs.GiuseppiSempervivum COURTYARD/PERIMETER
Sempervivumtectorum CommonHouseleek COURTYARD/PERIMETER
TREES Common Remarks
Bambusaoldhamii GiantTimberBamboo LANDSCAPEBUFFER
Brachychitonpopulneum BottleTree LANDSCAPEBUFFER
Geijeraparviflora AustralianWillow LANDSCAPEBUFFER
Chamaeropshumilis MediterraneanFanPalm PERIMETER
Phoenixdactylifera`DegletNoor` DatePalm PERIMETER
Tristaniaconferta BrisbaneBox PERIMETER
Pittosporumundulatum VictorianBox STREETTREE
Platanusxacerifolia`Bloodgood` LondonPlaneTree STREETTREE
Ulmusparvifolia ChineseElm STREETTREE
Aeoniumx`AliceKeckPark` Aeonium COURTYARD/PERIMETER
Asparagusdensiflorus COURTYARD/PERIMETER
Callistemonviminalis`LittleJohn` DwarfWeepingBottlebrush COURTYARD/PERIMETER
Carissamacrocarpa`GreenCarpet` GreenCarpetNatalPlum COURTYARD/PERIMETER
Chondropetalumtectorum CapeRush COURTYARD/PERIMETER
Crassulaovata LargeJadePlant COURTYARD/PERIMETER
Dietesbicolor FortnightLily COURTYARD/PERIMETER
Dymondiamargaretae Dymondia COURTYARD/PERIMETER
Echeveriax`Afterglow` AfterglowEcheveria COURTYARD/PERIMETER
Hebealbicans`RedEdge` Hebe COURTYARD/PERIMETER
Hebex`SilverDollar` Hebe COURTYARD/PERIMETER
Juncuspatens`Carman`sGrey` SpreadingRush COURTYARD/PERIMETER
Leymuscondensatus GiantWildRye COURTYARD/PERIMETER
Muhlenbergiarigens DeerGrass COURTYARD/PERIMETER
Phormiumcookianum VariegatedMountainFlax COURTYARD/PERIMETER
Phormiumtenax`ApricotQueen` NewZealandFlax COURTYARD/PERIMETER
Phormiumtenax`Fiesta` FiestaDwarfRedFlax COURTYARD/PERIMETER
Phormiumtenax`YellowWave` NewZealandFlax COURTYARD/PERIMETER
Phormiumtenax`YellowWave` NewZealandFlax COURTYARD/PERIMETER
Phormiumx`ChocolateBaby` NewZealandFlax COURTYARD/PERIMETER
Phormiumx`Jester` VariegatedMountainFlax COURTYARD/PERIMETER
Salviaclevelandii`WinifredGillman` ClevelandSage COURTYARD/PERIMETER
Salviaofficinalis GardenSage COURTYARD/PERIMETER
Sansevieriatrifasciata Sansevieria COURTYARD/PERIMETER
Sedumx`AutumnJoy` AutumnJoySedum COURTYARD/PERIMETER
Sedumx`PurpleEmperor` Stonecrop COURTYARD/PERIMETER
Sempervivumcalcareum`Giuseppi` Mrs.GiuseppiSempervivum COURTYARD/PERIMETER
Sempervivumtectorum CommonHouseleek COURTYARD/PERIMETER
Bougainvilleax`BarbaraKarst` BarbaraKarstBougainvillea PERIMETER
Bougainvilleax`OrangeKing` Bougainvillea PERIMETER
Calylophushartwegii Hartweg`sSundrops PERIMETER
Calystegiamacrostegia`AnacapaPink` AnacapaPinkCaliforniaMorningGlory PERIMETER
Cistussalviifolius RockroseSageleaf PERIMETER
Distictisbuccinatoria BloodRedTrumpetVine PERIMETER
Distictisbuccinatoria BloodRedTrumpetVine PERIMETER
Mirabilismultiflora ColoradoFourO`Clock PERIMETER
Muhlenbergiacapillaris PinkMuhly PERIMETER
Rhamnuscalifornica CaliforniaCoffeeBerry PERIMETER
Rosabanksiae LadyBank`sRose PERIMETER
Rosmarinusofficinalis Rosemary PERIMETER
SHRUBS Common Remarks
PERIMETER PLANT LIST COURTYARD PLANT LIST
02/21/2011
L1.2
PERIMETER PLANT LIST
PLANT PALETTE KEY PLAN (NTS)
COURTYARD PLANT LIST
TYPICAL STREET TREE AND MEXICAN FEATHER GRASS PLANTER
TRASH RECEPTACLE
TYPICAL STREET TREE AND MEXICAN FEATHER GRASS PLANTER|10101010|ATTACHMENT 3
112ATTACHMENT 3
113ATTACHMENT 3
114EXHIBIT 6
PROJECT BUDGET
TILDEN TERRACE
8 PROJECT BUDGET
EXHIBIT NO. 6
PROJECT BUDGET
SOURCES OF ACQUISITION AND CONSTRUCTION FUNDS:
Construction Loan $ 4,177,217
Residential Loan $ 11,805,000
Commercial Loan $ 3,395,000
Limited Partner Capital Contribution $ 3,216,800
Costs Deferred to Completion $ 132,843
Developer Equity $ 1,260,000
TOTAL SOURCES: $23,986,500
SOURCES OF PERMANENT FUNDS:
Permanent Loan $ 1,798,790
Residential Loan $ 11,805,000
Commercial Loan $ 3,395,000
Limited Partner Capital Contribution $ 5,957,710
AHP Loan $ 330,000
Deferred Developer Fee $ 700,000
TOTAL SOURCES: $23,986,500
PROJECT COSTS:
Property Acquisition $5,100,000
Construction Costs $ 11,997,498
Developer Fee $ 2,000,000
Indirect Costs $ 3,997,553
Replacement and Operating Reserves $ 84,493
Financing Costs $ 806,956
TOTAL PROJECT COSTS: $ 23,986,500
ATTACHMENT 3
115
EXHIBIT NO. 7
FORM OF GRANT DEED
Page 1
Tilden Terrace
9 Grant Deed v3
EXHIBIT NO. 7
FORM OF GRANT DEED
When Recorded Return to:
CULVER CITY REDEVELOPMENT
9770 Culver Boulevard
Culver City, California 90232-0507
Attn: John Fisanotti,
Redevelopment Project Manager
SPACE ABOVE THIS LINE FOR RECORDING USE
Parcel Number: 4213-007-900, 4213-007-901 OFFICIAL BUSINESS
Document Entitled to Free Recording
Per Government Code §27383
GRANT DEED
FOR VALUABLE CONSIDERATION, receipt of which is hereby acknowledged the CULVER
CITY REDEVELOPMENT AGENCY, a public body corporate and politic of the State of
California, herein called “Grantor”, acting to carry out the Redevelopment Plan for the Culver
City Redevelopment Project, herein called “Redevelopment Plan”, under the Community
Redevelopment Law of the State of California, hereby grants to TILDEN TERRACE, L.P., a
California limited partnership, herein called “Grantee”, the real property, hereinafter referred to
as the “Agency Parcel”, described in the document attached hereto, labeled Exhibit “A” and
incorporated herein by this reference.
(1) The Agency Parcel is conveyed in accordance with and subject to the Redevelopment
Plan, which was approved and adopted on November 23, 1998 by Ordinance No. 98-014 of the
City Council of the City of Culver City, as amended by Ordinance No. 98-015 of the City
Council of the City of Culver City, and the Disposition and Development Agreement (the
“DDA”) entered into by and between Grantor and Grantee as of March 21, 2011, both of which
documents are public records on file in the offices of the City Clerk of the City of Culver City
and the Secretary of Grantor. DDA as used herein shall mean, refer to and include the DDA, as
well as any riders, exhibits, addenda, implementation agreements, amendments and attachments
thereto or other documents expressly incorporated by reference in the DDA. Any capitalized
term not herein defined shall have the same meaning as given to such term in the DDA.
(2) Grantee hereby covenants and agrees for itself, its successors, its assigns, and every
successor in interest to the Agency Parcel that Grantee, such successors and such assigns, shall
develop, maintain, and use the Agency Parcel only as follows:
ATTACHMENT 3
116
EXHIBIT NO. 7
FORM OF GRANT DEED
Page 2
Tilden Terrace
9 Grant Deed v3
(a) Grantee shall develop and construct a thirty-three (33) unit residential
rental development, with associated commercial space as more fully set
forth in the DDA, on the Agency Parcel and the “Developer Parcel” (as
such term is defined in the DDA and which, together with the Agency
Parcel is referred to herein as the “Property”) in accordance with the
DDA.
(b) Grantee shall rent the Very Low Income Units and the Low Income Units
exclusively to Very Low Income and Low Income Households at
Affordable Rent throughout the term of the Restricted Period. The term
“Very Low Income Units” shall mean the two (2) one-bedroom, seven (7)
two-bedroom and five (5) three-bedroom rental dwelling units restricted to
occupancy by Very Low Income Households, the term “Low Income
Units” shall mean the four (4) two-bedroom and two (2) three-bedroom
rental dwelling units restricted to occupancy by Low Income Households,
and the term “Moderate Income Units” shall mean the seven (7) two-
bedroom and five (5) three-bedroom rental dwelling units restricted
occupancy by Moderate Income Households. The term “Very Low Income
Household” shall have the meaning given in California Health and Safety
Code section 50105(a), the term “Low Income Household” shall have the
meaning given to “lower income household” in Health and Safety Code
section 50079.5(a) and the term “Moderate Income Household” shall
mean a household whose income does not exceed 120% of Area Median
Income adjusted for family size. The term “Affordable Rent” shall mean
(a) for Very Low Income Units, rental rates not to exceed thirty percent
(30%) times fifty percent (50%) of Area Median Income adjusted for
household size appropriate to the unit; (b) for Low Income Units, rental
rates not to exceed thirty percent (30%) times sixty percent (60%) of Area
Median Income adjusted for household size appropriate to the unit; and (c)
for Moderate Income Units, rental rates not to exceed thirty percent (30%)
times one hundred ten percent (110%) of Area Median Income adjusted
for household size appropriate to the unit. As used herein, Area Median
Income means the median income of the Los Angeles-Long Beach
Standard Metropolitan Statistical Area, adjusted for family size by the
United States Department of Housing and Urban Development (“HUD”)
pursuant to Section 8 of the United States Housing Act of 1937, as
determined by HUD and published from time to time by the California
Department of Housing and Community Development, and the phrase
“adjusted for household size appropriate to the unit” means a household
size equal to the number of bedrooms in the unit plus one. Affordable
Rents shall include a reasonable allowance for utilities. Grantee’s
obligations under this paragraph shall remain in effect throughout the
period that ends fifty-five (55) years after the Conversion Date.
ATTACHMENT 3
117
EXHIBIT NO. 7
FORM OF GRANT DEED
Page 3
Tilden Terrace
9 Grant Deed v3
(c) Grantee shall maintain and keep the buildings and related Improvements
on the Property and in the public rights-of-way (curb to property line) on
all sides of the Property in good repair and free from any accumulation of
debris, graffiti or waste materials, maintain the landscaping required to be
planted in a healthy and attractive condition, and take all other actions
necessary to maintain and ensure the neat and clean appearance of the
Property and such rights-of-way. The Property shall be maintained in a
professional manner. In the event of the Grantee’s or any successor’s
failure to comply with this Section, the Grantor, on two (2) weeks’ prior
written notice, may cause such compliance and upon the completion
thereof, its cost shall be borne by the Grantee or its successor (as the case
may be) and until paid, shall be a lien against the Property, which lien
shall at all times be junior to any senior financing.
(3) Prior to the recordation of a Release of Construction Covenants issued by Grantor for the
Improvements to be constructed on the Property or on any part thereof:
(a) Grantee shall not make any sale, transfer, conveyance or assignment of the
Property or any part thereof or the buildings or structures thereon, without
the prior written approval of Grantor, except as expressly permitted by the
DDA. This prohibition shall not be deemed to prevent the granting of
easements or permits to facilitate the development of the Property, nor
shall it prohibit granting any security interests permitted by paragraph (b)
below of this Grant Deed for financing the acquisition and development of
the Property.
(b) Grantee shall not place or suffer to be placed on the Property any lien or
encumbrance other than mortgages, deeds of trust, or other form of
conveyance permitted by the DDA. Grantee shall notify Grantor in
advance of any such conveyance for financing if Grantee proposes to enter
into the same prior to recordation of a Release of Construction Covenants
for the Improvements to be constructed on the Property. Grantee shall not
enter into any such conveyance for financing without prior written
approval of Grantor, which approval Grantor agrees to give if any such
conveyance is permitted by the DDA and with a responsible financial or
lending institution or other acceptable person or entity.
(4) Prior to the recordation of a Release of Construction Covenants issued by Grantor for the
improvements to be constructed on the Property or on any part thereof:
(a) Grantor shall have the right at its option to reenter and take possession of
the Agency Parcel hereby conveyed (or portion thereof) with all
improvements thereon, and to terminate and revest in Grantor the Agency
Parcel hereby conveyed (or portion thereof) and Grantee shall thereupon
ATTACHMENT 3
118
EXHIBIT NO. 7
FORM OF GRANT DEED
Page 4
Tilden Terrace
9 Grant Deed v3
forfeit its title to the Agency Parcel and the Improvements thereon if
Grantee (or its successors in interest) shall:
(i) Fail to commence construction of the Improvements on the
Property, as required by the DDA for a period of three (3) months
after written notice to proceed from Grantor, provided that Grantee
shall not have obtained an extension or postponement to which
Grantee may be entitled pursuant to the DDA; or
(ii) Abandon or substantially suspend construction of the
Improvements on the Property for a period of three (3) months
(other than due to a Force Majeure Event) after written notice of
such abandonment or suspension from Grantor, provided that
Grantee shall not have obtained an extension or postponement to
which Grantee may be entitled pursuant to the DDA; or
(iii) Assign or attempt to assign the DDA, or any rights therein, or
transfer, or suffer any involuntary transfer of, the Property, or any
part thereof, in violation of this Grant Deed.
(b) The right to reenter, repossess, terminate and revest, and the provisions
below regarding the application of proceeds, shall be subject to and be
limited by and shall not defeat, render invalid, or limit:
(i) Any mortgage or deed of trust or other security interest permitted
by paragraph (3)(b) above of this Grant Deed; or
(ii) Any rights or interests provided for the protection of the holders of
such mortgages, deeds of trust, or other security interests.
(c) Grantor agrees that it will not exercise its Right of Reentry until it has
given Grantee and Grantee’s Investor Limited Partner written notice of the
occurrence of an event giving rise to the Right of Reentry (the “Reentry
Event”) and providing Grantee and Grantee’s Investor Limited Partner
with a thirty (30) day period in which to cure such Reentry Event (the
“Reentry Event Cure Period”). If the Reentry Event can only reasonably
be cured by the removal of Grantee’s general partner, then the Reentry
Event Cure Period shall be extended to such reasonable period of time as
is necessary for the Investor Limited Partner to cause the removal and
replacement of the general partner.
(d) The right to reenter, repossess, terminate and revest shall not apply to the
Agency Parcel, or portions thereof, for which a Release of Construction
Covenants has been issued by Grantor and recorded.
ATTACHMENT 3
119
EXHIBIT NO. 7
FORM OF GRANT DEED
Page 5
Tilden Terrace
9 Grant Deed v3
(e) Grantor’s exercise of the Agency Option to acquire the Developer Parcel
set forth in Section 611 of the DDA shall be a condition concurrent with
Grantor’s right to reenter, repossess, terminate and revest. If Grantor does
not exercise the Agency Option concurrently with its exercise of the right
to reenter, repossess, terminate and revest, then Grantor’s exercise of its
right to reenter, repossess, terminate and revest provided in this paragraph
(4) shall be null and void and of no further effect.
(f) In the event title to the Property or any part thereof is vested in Grantor as
provided in this paragraph (4), Grantor shall, pursuant to its
responsibilities under state law, use its diligent and good faith efforts to
resell the Property, or any part thereof, as soon and in such manner as
Grantor shall find feasible and consistent with the objectives of such law
and of the Redevelopment Plan to a qualified party or parties (as
determined by Grantor) who will assume the obligation of making or
completing the Improvements or such other improvements in their stead as
shall be satisfactory to Grantor and in accordance with the uses specified
for such Property or part thereof in the Redevelopment Plan. Upon such
resale of the Property and satisfaction of obligations owed to the holder of
any mortgage, deed of trust or other security interest authorized by the
DDA, the proceeds thereof shall be applied:
(i) First, to reimburse Grantor, on its own behalf or on behalf of the
City of Culver City for all costs and expenses incurred by Grantor,
including but not limited to the Option Price for the Developer
Parcel, salaries to personnel engaged in such action, in connection
with the recapture, management, and resale of the Property or part
thereof (but less any income derived by Grantor from the Property
or part thereof in connection with such management); all taxes,
assessments, and water and sewer charges with respect to the
Property or part thereof incurred by Grantor; 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 Grantee, its successors or
transferees; any expenditures made or obligations incurred with
respect to the making or completion of the agreed Improvements or
any part thereof on the Property or part thereof; and any amounts
otherwise owing to Grantor by Grantee and its successor or
transferee; and
(ii) Second, to reimburse Grantee, its successor or transferee, up to the
amount equal to: the sum of (l) the Purchase Price paid to Grantor
for the Agency Parcel; and (2) the costs incurred by Grantee for the
development of the Property, or part thereof, or for the
construction of the agreed improvements thereon, if such costs
ATTACHMENT 3
120
EXHIBIT NO. 7
FORM OF GRANT DEED
Page 6
Tilden Terrace
9 Grant Deed v3
were incurred in accordance with the Method of Financing
(Attachment No. 3 to the DDA) and Project Budget (Attachment
No. 6-A to the DDA); less (3) any gain or income withdrawn or
made by Grantee from the Property (or such part thereof) or from
the improvements thereon. For purposes of this paragraph the term
“cost incurred” shall include direct, out-of-pocket expenses of
development, but shall exclude Grantee’s field and home office
overhead expenses, developer fees, and profit.
Any balance remaining after such reimbursements shall be retained by the
Agency as its property. The Agency shall also be entitled to exercise all
of its rights under the Assignment of Agreements (Exhibit No. 14 to the
DDA).
(g) To the extent that Grantor’s right hereunder to reenter, repossess,
terminate and revest involves a forfeiture, it must be strictly interpreted
against Grantor, the party for whose benefit it is created. Grantor’s right
to reenter, repossess, terminate and revest is to be interpreted in light of
the fact such right is expressly authorized by Health and Safety Code
section 33438 and in light of the fact that Grantor is conveying the Agency
Parcel to Grantee for development and not for speculation in undeveloped
land.
(5) Grantee covenants and agrees for itself, its successors, its 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 sex, sexual orientation, marital status, race, color,
creed, religion, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy,
tenure, or enjoyment of the Property, nor shall Grantee 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. The foregoing covenants shall run with the
land.
(6) All deeds, leases or contracts made relative to the Property, improvements thereon, or any
part thereof, shall contain or be subject to substantially the following nondiscrimination or
nonsegregation clauses:
1. 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 any basis listed in subdivision (a) or (d) of
Section 12955 of the Government Code, as those bases are defined
in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of
subdivision (p) of Section 12955, and Section 12955.2 of the
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Government Code, in the sale, lease, sublease, transfer, use,
occupancy, tenure, or enjoyment of the premises herein conveyed,
nor shall the grantee or any person claiming under or through him
or her, establish or permit any 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 premises herein conveyed. The
foregoing covenants shall run with the land.”
Notwithstanding the paragraph, with respect to familial status,
paragraph (1) shall not be construed to apply to housing for older
persons, as defined in Section 12955.9 of the Government Code.
With respect to familial status, nothing in paragraph (1) shall be
construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11, and
799.5 of the Civil Code, relating to housing for senior citizens.
Subdivision (d) of Section 51 and Section 1360 of the Civil Code
and subdivisions (n), (o), and (p) of Section 12955 of the
Government Code shall also apply to the above paragraph.
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:
That there shall be no discrimination against or segregation of any
person or group of persons, on account of any basis listed in
subdivision (a) or (d) of Section 12955 of the Government Code,
as those bases are defined in Sections 12926, 12926.1, subdivision
(m) and paragraph (1) of subdivision (p) of Section 12955, and
Section 12955.2 of the Government Code, in the 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.”
Notwithstanding the above paragraph, with respect to familial
status, paragraph (1) shall not be construed to apply to housing for
older persons, as defined in Section 12955.9 of the Government
Code. With respect to familial status, nothing in paragraph (1)
shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11,
and 799.5 of the Civil Code, relating to housing for senior citizens.
Subdivision (d) of Section 51 and Section 1360 of the Civil Code
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and subdivisions (n), (o), and (p) of Section 12955 of the
Government Code shall apply to the above paragraph.
3. In contracts entered into by the Agency relating to the sale,
transfer, or leasing of land or any interest therein acquired by the
Agency within any survey area of redevelopment project the
foregoing provisions in substantially the forms set forth shall be
included and the contracts shall further provide that the foregoing
provisions shall be binding upon and shall obligate the contracting
party or parties and any subcontracting party or parties, or other
transferees under the instrument.
(7) All conditions, covenants and restrictions contained in this Grant Deed shall be covenants
running with the land, and shall, in any event, and without regard to technical classification or
designation, legal or otherwise, be, to the fullest extent permitted by law and equity, binding for
the benefit and in favor of, and enforceable by Grantor, its successors and assigns, and the City
of Culver City and its successors and assigns, against Grantee, its successors and assigns, to or of
the Property conveyed herein or any portion thereof or any interest therein, and any party in
possession or occupancy of said Property or portion thereof.
(8) The conditions contained in paragraphs (4) and (5) of this Grant Deed shall terminate and
become null and void upon the Conversion Date. All other covenants in this Grant Deed shall
remain in perpetuity, except as otherwise expressly provided herein.
(9) In amplification and not in restriction of the provisions set forth hereinabove, it is
intended and agreed that Grantor shall be deemed a beneficiary of the agreements and covenants
provided hereinabove both for and in its own right and also for the purposes of protecting the
interests of the community. All covenants without regard to technical classification or
designation shall be binding for the benefit of Grantor, and such covenants shall run in favor of
Grantor for the entire period during which such covenants shall be in force and effect, without
regard to whether Grantor is or remains an owner of any land or interest therein to which such
covenants relate. Grantor shall have the right, in the event of any breach of any such agreement
or covenant, to exercise all the rights and remedies, and to maintain any actions at law or suit in
equity or other proper proceedings to enforce the curing of such breach of agreement or
covenant.
(10) No violation or breach of the covenants, conditions, restrictions, provisions or limitations
contained in this Grant Deed shall defeat or render invalid or in any way impair the lien or
charge of any mortgage or deed of trust or security interest permitted by paragraph (3)(b) of this
Grant Deed; provided, however, that any subsequent owner of the Property shall be bound by
such remaining covenants, conditions, restrictions, limitations, and provisions, whether such
owner’s title was acquired by foreclosure, deed in lieu of foreclosure, trustee’s sale or otherwise.
(11) None of the terms, covenants, agreements or conditions heretofore agreed upon in writing
in other instruments between the parties to this Grant Deed with respect to obligations to be
performed, kept or observed by Grantee or Grantor in respect to said Property or any part thereof
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after this conveyance of said Property shall be deemed to be merged with this Grant Deed until
the Conversion Date.
(12) The covenants contained in this Grant Deed shall be construed as covenants running with
the land and not as conditions which might result in forfeiture of title, except for the covenant
and condition contained in paragraph (4) of this Grant Deed.
[Remainder of Page Intentionally Left Blank; Signatures on Following Page]
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IN WITNESS WHEREOF, Grantor and Grantee have caused this instrument to be
executed on their behalf by their respective officers hereunto duly authorized this ____ day of
___________, 2011.
GRANTOR
Date:_________________ CULVER CITY REDEVELOPMENT AGENCY,
a public body corporate and politic
By: _________________________________
John M. Nachbar
Executive Director
ATTEST:
By: _________________________________
Agency Secretary
APPROVED AS TO FORM:
By: _________________________________
General Counsel
By: _________________________________
KANE, BALLMER & BERKMAN
Agency Special Counsel
Grantee hereby accepts the written deed, subject to all of the matters hereinbefore set forth.
GRANTEE
Date: ____________________ TILDEN TERRACE, L.P.,
a California limited partnership
By: Los Angeles Housing Partnership, Inc.,
a California nonprofit public benefit corporation
Its: Managing General Partner
By: _________________________
Mary Silverstein
Its: President and Executive Director
ATTACHMENT 3
125
State of California )
)
County of Los Angeles )
On __________________, 2011 before me, ______________________(here insert name of the
officer), Notary Public, personally appeared , who
proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument
the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature of Notary Public
[Seal]
State of California )
)
County of Los Angeles )
On __________________, 2011 before me, ______________________(here insert name of the
officer), Notary Public, personally appeared , who
proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument
the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature of Notary Public
[Seal]
ATTACHMENT 3
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EXHIBIT A
LEGAL DESCRIPTION
ALL THAT CERTAIN REAL PROPERTY SITUATED IN THE COUNTY OF LOS
ANGELES, STATE OF CALIFORNIA, DESCRIBED AS FOLLOWS:
LOTS 4, 5, 6, 7 AND 8 OF TRACT NO. 9648, IN THE CITY OF CULVER CITY, COUNTY
OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 142,
PAGES(S) 13 TO 15 INCLUSIVE OF MAPS, IN THE OFFICE OF THE COUNTY
RECORDER OF SAID COUNTY.
APN: 4213-007-900
And
LOT 3 OF TRACT 9648, AS SHOWN ON A MAP RECORDED IN BOOK 142, PAGES 13,
INCLUSIVE OF MISCELLANEOUS MAPS, RECORDS OF LOS ANGELES COUNTY,
CALIFORNIA.
APN: 4213-007-901
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EXHIBIT NO. 8
FORM OF RESIDENTIAL NOTE
RESIDUAL RECEIPTS PROMISSORY NOTE
SECURED BY DEED OF TRUST
TO THE CULVER CITY REDEVELOPMENT AGENCY
(HOUSING SET ASIDE FUNDS)
3% Interest Culver City, California
$11,805,000 ______________, 2011
FOR VALUE RECEIVED, TILDEN TERRACE, L.P., a California limited Partnership
(“Borrower”), hereby promises to pay to the CULVER CITY REDEVELOPMENT AGENCY, a
public body, corporate and politic, (“Agency”) or order, a principal amount of Eleven Million
Eight Hundred Five Thousand Dollars ($11,805,000), or so much thereof as may be advanced by
the Agency to the Borrower as the Residential Loan pursuant to the Disposition and
Development Agreement dated as of March 21, 2011 (the “DDA”) between Borrower
(“Developer” therein) and the Agency, incorporated herein by this reference. The DDA is a
public record on file in the offices of the Agency. The Borrower shall pay interest at the rate, in
the amount and at the time hereinafter provided.
1. Definitions. Any capitalized term not otherwise defined herein shall have the
meaning ascribed to such term in the DDA. In addition, the following terms shall have the
following meanings:
The term “Net Proceeds” shall mean the proceeds of a sale, transfer or refinancing after
repayment of existing indebtedness, less the reasonable and customary costs of the transaction.
The term “Commercial Loan” shall mean the Agency’s loan to Borrower in the face
amount of THREE MILLION THREE HUNDRED NINETY FIVE THOUSAND DOLLARS
($3,395,000.00), as evidenced by the Commercial Note and secured by the Commercial Deed of
Trust.
The term “Residential Residual Receipts” shall mean, in each calendar year, the amount
by which Gross Residential Revenue (as defined below) exceeds Annual Residential Operating
Expenses (as defined below), as determined by a certified statement to be completed not later
than one hundred twenty (120) days after the end of each calendar year by Borrower using
generally accepted accounting principles and based on the accrual method (the “Audit”).
(i) “Gross Residential Revenue,” with respect to each calendar year, shall
mean all revenue, income, receipts, and other consideration actually received from operation or
leasing of the residential component of the Project, excluding the Commercial Space. “Gross
Residential Revenue” shall include, but not be limited to: all rents, fees and charges paid by
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tenants, Section 8 payments or other rental subsidy payments received for the dwelling units,
deposits forfeited by tenants, all cancellation fees, price index adjustments and any other rental
adjustments to leases or rental agreements; proceeds from vending and laundry room machines;
the proceeds of business interruption or similar insurance; the proceeds of casualty insurance to
the extent not utilized to repair or rebuild the Project or to repay debt on loans relating to the
Project and previously approved by the Agency; and condemnation awards for a taking of part or
all of the Project for a temporary period, not used to repay debt on loans relating to the Project
and previously approved by the Agency. “Gross Revenue” shall also include the fair market
value of any goods or services provided in consideration for the leasing or other use of any
residential portion of the Project excluding the Commercial Space, except that the value of
services provided by on-site manager(s) shall not be treated as “Gross Revenue” if no more than
one dwelling unit is leased to or otherwise used by on-site manager(s). “Gross Revenue” shall
not include residential tenants’ security deposits, required reserves or deposits, proceeds from the
Senior Loan, the Agency Loan, Commercial Loan, Developer Equity, or other financing
provided to the Developer, including capital contributions or similar advances, or interest that is
earned on and allocated to reserve accounts.
(ii) “Annual Residential Operating Expenses,” with respect to each
calendar year shall mean the following costs reasonably and actually incurred for operation and
maintenance of the residential component of the Project, excluding the Commercial Space, to the
extent that they are consistent with Borrower’s annual certified statement of revenues and
expenses prepared using generally accepted accounting principles: property and other taxes and
assessments imposed on the residential component of the Project; premiums for property damage
and liability insurance; utility services not paid for directly or reimbursed by tenants, including
but not limited to water, sewer, trash collection, gas and electricity; maintenance and repair
including but not limited to pest control, landscaping and grounds maintenance, painting and
decorating, installation of appliances, cleaning, common systems repairs, general repairs,
janitorial, supplies, and similar customary utility services; maintenance and repair of solar panels
and photovoltaic systems; any license or certificate of occupancy fees required for operation of
the residential component of the Project; general administrative expenses including but not
limited to advertising and marketing, security services and systems, professional fees for legal,
audit, accounting and tax returns of the limited partnership, and similar customary and
reasonable administrative expenses; property management fees, not to exceed six percent (6%)
of Gross Revenue and pursuant to a management contract approved by the Agency; partnership
management fees payable to Borrower’s Managing General Partner in an amount not to exceed
ten thousand dollars ($10,000) in the first year and, to the extent permitted by the Limited
Partnership Agreement, increased thereafter at an annual rate not to exceed three percent (3%);
an asset management fee payable to Borrower’s Investor Limited Partner in a non-cumulative
amount not to exceed five thousand dollars ($5,000) in the first year and, to the extent required
by the Limited Partnership Agreement, increased thereafter at an annual rate not to exceed three
percent (3%); a social service fee not to exceed ten thousand dollars ($10,000), increased
thereafter at an annual rate not to exceed three percent (3%); cash deposited into a replacement
reserve in the amount of $___ per unit per year, subject to annual increases not to exceed three
percent (3%), or such higher amount as required by the Senior Lender or Investor Limited
Partner; cash deposited into an operating reserve in such reasonable amounts as are required by
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Senior Lender, the California Tax Credit Allocation Committee, and the Investor Limited Partner
from time to time; deferred Developer Fee; necessary capital expenditures for upkeep and
repair, and any expenditures required based upon a physical needs assessment by the Senior
Lender or Investor Limited Partner (not paid from reserves); fixed debt service payments
(excluding debt service contingent upon the availability of residual receipts or surplus cash of the
Project) on loans associated with the Project and approved by the Agency; and monitoring fees
to the Agency in the amount of $7,500 in the first year with annual increases of 3%. “Annual
Residential Operating Expenses” shall not include the following: book depreciation,
amortization, depletion or other non-cash expenses or any amount expended from a reserve
account. Annual Residential Operating Expenses shall be subject to the reasonable approval of
the Agency and shall not include expenses attributable to the Commercial Space.
The term “Senior Loan” shall mean, individually and collectively, the Construction Loan
and the Permanent Loan, or any other loan secured by a deed of trust or other instrument to
which the Agency agrees to subordinate this Note, the Residential Deed of Trust and the other
Residential Loan Documents.
2. This Note evidences the obligation of the Borrower to the Agency for the
repayment of the Residential Loan. Borrower may prepay the principal balance of this Note at any
time without penalty. However, even if Borrower prepays the entire balance of this Note including
all accrued interest, costs and penalties, the covenants, conditions and restrictions imposed on the
Property by the Agreement Containing Covenants shall remain in full force and effect for the full
term as specified therein.
3. This Note is payable at the principal office of Agency, 9770 Culver Boulevard,
Culver City, California 90230-0507, or at such other place as the holder hereof may inform the
Borrower in writing, in lawful money of the United States.
4. This Note is secured by the Residential Deed of Trust.
5. This Note shall accrue simple interest at the rate of three percent (3%) per annum
on a “draw down” basis on the principal amount disbursed by the Agency, from the date of
disbursement. However, if any event occurs giving the Agency the right to accelerate repayment of
this Note, the entire unpaid principal balance owing hereunder shall, as of the date of such default,
commence to accrue interest at a rate equal to maximum interest rate permitted by law (the “Default
Rate”). Further, in the event Borrower fails to reimburse the Agency for any amount advanced by
or for the account of the Agency which is due hereunder or under the Residential Deed of Trust
within ten (10) days after written notice of such advance is made by the Agency to Borrower,
then such unreimbursed amount shall thereafter bear interest at the Default Rate until paid
6. The unpaid principal balance of this Note and all accrued but unpaid interest shall
be due and payable on the earliest to occur of the following (which shall be referred to herein as
the “Maturity Date”):
(a) June 30, 20__;
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(b) the fifty-fifth (55
th
) anniversary of the Conversion Date, evidenced by the
recording against the Property of a reconveyance of the Construction Loan Deed of Trust upon
repayment in full of the Construction Loan;
(c) the date the Property or the improvements thereon or any portion thereof
or interest therein is sold, transferred, assigned or refinanced, without the prior written approval
of the Agency, except as permitted by the provisions of Section 206 (“Prohibition Against
Transfers”) of the DDA; or
(d) the date on which there is a Default by the Borrower under the terms of
this Note, the DDA, the Residential Deed of Trust, the Agreement Containing Covenants, or any
deed of trust or other instrument securing the Senior Loan, which is not cured or waived within
the respective time period provided herein and therein.
7. Prior to the Maturity Date, Borrower shall be obligated to repay the Residential
Loan as follows:
(a) Borrower shall be obligated to repay the principal amount of this Note and
the accrued interest thereon, without set off or deduction, by paying to the Agency, on each June
1 in “Residual Residential Receipts,” to the extent Residual Residential Receipts are available,
for the calendar year, or portion thereof, ending on the immediately preceding December 31 (as
the term “Residual Residential Receipts ” are defined in Section 1 of this Note), fifty percent
(50%) of that year’s Residual Residential Receipts. The first such repayment under this Section
7 shall be due on the first June 1 which is one full calendar year following the Conversion Date
(as defined in the DDA), and the last payment shall be due on June 1 fifty-five (55) years later.
Notwithstanding the foregoing, this Note shall be fully due and payable on the Maturity Date.
(b) To induce Agency to make the Residential Loan, the Developer covenants
and agrees as follows:
(i) Distribution of Cost Savings
If, on the Conversion Date, the sum of all Project Funds disbursed (as
“Project Funds” is defined in the Disbursement Agreement), plus any retention amounts then
owing to contractors and others, plus any unpaid Project Costs set forth in the most recent
approved Project Budget (including paying down the Developer Fee to an amount that is not less
than $_________) which the Agency and Construction Lender agree are to be disbursed
subsequent to the Completion date (such as, by way of example only and without limiting the
generality of the foregoing, costs associated with funding final Tax Credit Equity Investor capital
contributions) is less than $23,986,500 (the amount of such savings being referred to herein as
the “Cost Savings”), then to the extent of fifty percent (50%) of the Cost Savings, any
undisbursed amount of the Permanent Loan plus any undisbursed amount of the Residential
Loan plus any undisbursed amount of the Commercial Loan plus any undisbursed capital
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contributions by Developer’s Limited Partner shall be released to the Agency to pay down the
Residential Loan.
(ii) Distribution of Solar Rebates or Awards
If any net additional funds (taking into account reasonable and customary
costs of obtaining such funds) beyond the amounts shown in the Project Budget are obtained by
the Developer as a benefit of the Project’s photovoltaic system, such as solar rebates or an in-lieu
grant pursuant to Section 1603 of the American Recovery and Reinvestment Tax Act of 2009,
then fifty percent (50%) of such funds shall first be used to pay down the Deferred Developer
Fee to an amount that is not less than $_______ and thereafter be used to pay down the
Residential Loan.
(c) Upon any sale or transfer of the Project or a refinance of the Senior Loan,
Borrower shall pay fifty percent (50%) of the Net Proceeds to the Agency to pay down the
Residential Loan.
(d) All payments to the Agency on the Residential Loan shall be applied first
to the payment of all expenses, charges, costs and fees incurred by or payable to Agency by
Borrower pursuant to the terms of the Residential Loan Documents (in such order and manner as
Agency, in its sole discretion, may elect), then to the payment of all interest accrued to the date
of such payment, and then to reduce the principal amount owed. All prepayment of principal on
this Note shall be applied to the most remote principal installment or installments until paid.
Notwithstanding anything to the contrary contained herein, after the occurrence and during the
continuation of a default under the Residential Deed of Trust, all amounts received by the
Agency from any party shall be applied in such order as the Agency, in its sole discretion, may
elect.
8. Any breach by Borrower of the provisions of Section 206 (“Prohibition Against
Transfers”) of the DDA shall constitute a default under this Note. The cure periods under the
DDA and this Note in connection with such a default shall run concurrently.
9. Borrower waives presentment for payment, demand, protest, and notices of
dishonor and of protest; the benefits of all waivable exemptions; and all defenses and pleas on
the ground of any extension or extensions of the time of payment or of any due date under this
Note, in whole or in part, whether before or after maturity and with or without notice. Borrower
hereby agrees to pay all costs and expenses, including reasonable attorney’s fees, which may be
incurred by the holder hereof, in the enforcement of this Note, the Residential Deed of Trust or
any term or provision of either.
10. Upon the failure of Borrower to perform or observe any term or provision of this
Note, or upon the occurrence of any event of default under the terms of the DDA, the Residential
Deed of Trust, the Environmental Indemnity, or the Agreement Containing Covenants, the
holder may exercise its rights or remedies hereunder or thereunder. All such rights and remedies
shall be cumulative. Upon the event of a default that is not cured or waived within the time
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provided therefore, the whole of the unpaid principal and interest owing on this Note shall, at the
option of Agency and without notice, become immediately due and payable. This right of the
Agency to declare amount owing on this Note immediately due and payable may be exercised at
any time after any such event and the acceptance of one or more payments from any person
thereafter shall not constitute a waiver of Agency’s right. Agency’s failure to exercise said right
in connection with any particular event or series of events shall not be construed as a waiver of
the provisions hereof as regards that event or any subsequent event. Notwithstanding anything in
this Note to the contrary, the Agency agrees that during the 15-year tax credit compliance period
for the Project’s Low and Moderate Income Housing Tax Credits, the Agency will not accelerate
payment of the amounts owing on this Note or commence foreclosure proceedings under the
Residential Deed of Trust.
11. (a) Subject to the extensions of time set forth in Section 12, and subject to the
further provisions of this Section 11, failure or delay by Borrower to perform any material term
or provision of this Note, the DDA, the Residential Deed of Trust, or the Agreement Containing
Covenants constitutes a default under this Note.
(b) Agency shall give written notice of default to Borrower, specifying the
default complained of by the Agency. Delay in giving such notice shall not constitute a waiver
of any default nor shall it change the time of default.
(c) Any failures or delays by Agency 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. Delays by Agency in asserting any of its rights and remedies shall not deprive Agency
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.
(d) If a monetary event of default occurs, prior to exercising any remedies
hereunder, the Agency shall give the Borrower written notice of such default. The Borrower
shall have a period of ten (10) days after such notice is given within which to cure the default
prior to exercise of remedies by the Agency.
(e) If a non-monetary event of default occurs, prior to exercising any remedies
hereunder, the Agency shall give Borrower notice of such default. If the default is reasonably
capable of being cured within thirty (30) days, Borrower shall have such period to effect a cure
prior to exercise of remedies by the Agency. If the default is such that it is not reasonably
capable of being cured within thirty (30) days, and Borrower (i) initiates corrective action within
said period, and (ii) diligently, continually, and in good faith works to effect a cure as soon as
possible, then Borrower shall have such additional time as is reasonably necessary to cure the
default prior to exercise of any remedies by the Agency. If Developer fails to take corrective
action or cure the default within a reasonable time, the Agency shall give Developer and, as
provided in paragraph (f), below, the Investor Limited Partner, notice thereof, whereupon the
Investor Limited Partner may remove and replace the General Partner with a substitute general
partner, who shall effect a cure within a reasonable time thereafter in accordance with the
foregoing provisions. The Agency agrees to accept cures tendered by the Investor Limited
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Partner within the cure periods provided in this Note or within the time periods provided in Civil
Code Section 2924c, whichever is longer. Additionally, in the event the Investor Limited Partner
is precluded from curing a non-monetary default due to an inability to remove the General
Partner as a result of a bankruptcy, injunction, or similar proceeding by or against Developer or
its General Partner, the Agency agrees to forbear from completing a foreclosure (judicial or
nonjudicial) during the period during which the Investor Limited Partner is so precluded from
acting, not to exceed 90 days, provided such limited partner is otherwise in compliance with the
foregoing provisions. In no event shall the Agency be precluded from exercising remedies if its
security becomes or is about to become materially jeopardized by any failure to cure a default or
the default is not cured within ninety (90) days after the first notice of default is given.
(f) After Borrower gives written notice to the Agency that the Investor
Limited Partner has been admitted to the Limited Partnership, the Agency shall send to the
Investor Limited Partner a copy of all notices of default and all other notices that the Agency
sends to Borrower, at the address for the Investor Limited Partner given in Section 16 of this
Note.
(g) Any notice of default shall be deemed given only if either (i) dispatched
by first class mail, registered or certified, postage prepaid, return receipt requested, to the
addresses specified for the Borrower and the Investor Limited Partner in Section 16 of this Note,
or (ii) by personal delivery (including by means of professional messenger or courier service
such as United Parcel Service or Federal Express) to the addresses specified for the Borrower
and the Investor Limited Partner in Section 16 of this Note. Receipt shall be deemed to have
occurred on the date marked on a written postal service or messenger or courier service receipt as
the date of delivery or refusal of delivery (or attempted delivery if undeliverable). If either party
gives notice of a change of address in the manner specified in this paragraph, all notices,
demands and communications originated after receipt of the change of address (or the effective
date specified in the notice of change of address, if later) shall be transmitted, delivered or sent to
the new address.
12. Notwithstanding specific provisions of this Note, non-monetary performance
hereunder shall not be deemed to be in default where delays are due to causes beyond the control
and without the fault of the party claiming an extension of time to perform (a “Force Majeure
Delay”), provided that they actually delay and interfere with the timely performance of the
matter to which they would apply and despite the exercise of diligence and good business
practices are or would be beyond the reasonable control of the party claiming such interference,
including: war; insurrection; strikes; lock-outs; 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 including litigation challenging
the validity of this transaction or any element thereof; unusually severe weather; inability to
secure necessary labor, materials or tools; delays of any contractor, subcontractor, or suppliers;
acts of the other party; acts or failure to act of any Governmental Agency (except acts or failure
to act of Agency shall not excuse performance by Agency); the imposition of any applicable
moratorium by a Governmental Agency; or any other causes which despite the exercise of
diligence and good business practices are or would be beyond the reasonable control of the party
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claiming such delay and interference. Notwithstanding the foregoing, none of the foregoing
events shall constitute a Force Majeure Delay unless and until the party claiming such delay and
interference delivers to the other party written notice describing the event, its cause, when and
how such party obtained knowledge, the date the event commenced, and the estimated delay
resulting therefrom. Any party claiming a Force Majeure Delay shall deliver such written notice
within ten (10) business days after it obtains actual knowledge of the event.
13. If the rights created by this Note shall be held by a court of competent jurisdiction
to be invalid or unenforceable as to any part of the obligations described herein, the remaining
obligations must be completely performed and paid.
14. The Residential Deed of Trust securing this Note shall be subordinate and junior
in all respects to the liens, terms, covenants and conditions of the Senior Deed of Trust, to the
extent and in the manner provided in that certain subordination agreement with Senior Lender dated
on or about the date hereof (the “Subordination Agreement”). The rights and remedies of the payee
and each subsequent holder of this Note under the Agency Deed of Trust securing this Note are
subject to the restrictions and limitations set forth in the Subordination Agreement. Each
subsequent holder of this Note shall be deemed, by virtue of such holder’s acquisition of the Note,
to have agreed to perform and observe all of the terms, covenants and conditions to be performed or
observed by the Agency under the Subordination Agreement.
15. (a) The obligation to repay the Residential Loan is a nonrecourse obligation
of the Borrower and its partners. Neither the Borrower nor any of its general or limited partners,
nor any other party, shall have any personal liability for repayment of the loan. The sole
recourse of the Agency with respect to repayment of the Residential Loan shall be the exercise of
its rights against the Property and the improvements thereon and any related security for the
Residential Loan. Provided, however, that the foregoing shall not (i) constitute a waiver of any
obligation evidenced by the Residential Loan Documents, the Agreement Containing Covenants
or the Environmental Indemnity; (ii) prevent or in any way hinder the Agency from exercising,
or constitute a defense, an affirmative defense, a counterclaim, or other basis for relief in respect
of the exercise of, any remedy prescribed by law or in equity in case of default, other than
repayment of the Residential Loan; or (iii) relieve Borrower of any of its obligations under any
indemnity delivered by Borrower to the Agency. The foregoing provisions of this paragraph are
limited by the provision that in the event of the occurrence of a default, Borrower and its
successors and assigns shall have personal liability hereunder for any deficiency judgment, but
only if and to the extent Borrower, its principals, shareholders, partners or its successors and
assigns received rentals, other revenues, or other payments or proceeds in respect of the
mortgaged Property during the continuance of such default, which rentals, other revenues, or
other payments or proceeds have not been used for the payment of ordinary and reasonable
operating expenses of the mortgaged Property, ordinary and reasonable capital improvements to
the mortgaged Property, debt service, real estate taxes in respect of the mortgaged Property and
basic management fees, but not incentive fees, payable to an entity or person unaffiliated with
Borrower in connection with the operation of the mortgaged Property, which are then due and
payable.
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(b) Notwithstanding the foregoing, the Agency may obtain a judgment or order
(including, without limitation, an injunction) requiring any Person to perform (or refrain from)
specified acts other than repayment of the Residential Loan; may proceed against any Person
whatsoever with respect to the enforcement of any guarantees, surety bonds, letters of credit,
reimbursement agreements or similar rights to payment or performance; and may recover
directly from any Person:
(i) any damages, costs and expenses incurred by Agency as a result of fraud,
misrepresentation or any criminal act or acts of Borrower or any member,
partner, shareholder, officer, director or employee of (a) Borrower or (b)
any of Borrower’s members or general partners or (c) any member or
partner of any of Borrower’s members or general partners;
(ii) any damages, costs and expenses incurred by Agency as a result of any
misappropriation of funds provided for the construction of the Project,
rents and revenues from the operation of the Project, or proceeds of
insurance policies or condemnation proceeds;
(iii) any and all amounts owing by Borrower pursuant to Borrower’s
indemnification regarding Hazardous Substances; and
(iv) all court costs and attorneys’ fees reasonably incurred in enforcing or
collecting upon any of the foregoing exceptions.
16. (a) The address of Borrower for purposes of receiving notices pursuant to this
Note is as follows:
c/o Los Angeles Housing Partnership
Attn: Mary Silverstein, President and Executive Director
1200 Wilshire Boulevard, Suite 307
Los Angeles, California 90017
With a copy to:
Bocarsly Emden Cowan Esmail & Arndt LLP
Attn: Kyle Arndt, Esq.
633 West Fifth Street, 70th Floor
Los Angeles, California 90071
(b) The address of Investor Limited Partner for purposes of receiving notices
pursuant to this Note is as follows:
Hudson Housing Capital, LLC
630 Fifth Avenue, 28
th
Floor
New York, NY 10111
Attn: Joseph A. Macari
17. In addition to the other terms of this Note, the Borrower hereby agrees and
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acknowledges that, notwithstanding any internal accounting procedures or provision pertaining
to the use of receipts, payments, reserves and distributions contained in its partnership agreement
or other organizational document, the terms of this Note and the DDA shall control as to the
repayment of the Residential Loan.
18. Neither this Note nor any term hereof may be waived, amended, discharged,
modified, changed or terminated orally; nor shall any waiver of any provision hereof be effective
except by an instrument in writing signed by the Agency and Borrower.
19. Notwithstanding any provision in this Note, the Agency Deed of Trust or other
document securing same, the total liability for payment in the nature of interest shall not exceed the
limit imposed by applicable laws of the State of California.
20. This Note has been executed and delivered by Borrower in the State of California
and is to be governed and construed in accordance with the internal laws thereof, disregarding the
rules governing conflict of laws.
21. Every provision of this Note is intended to be severable. In the event any term or
provision hereof is declared by a court of competent jurisdiction to be illegal, invalid or
unenforceable for any reason whatsoever, such illegality, invalidity or unenforceability shall not
affect the balance of the terms and provisions hereof, which terms and provisions shall remain
binding and enforceable, and this Note shall be construed as if such illegal, invalid or
unenforceable term or provision had not been contained herein.
22. Time is of the essence in the performance of each provision hereof.
[Remainder of Page Intentionally Left Blank; Signatures on Following Page]
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IN WITNESS WHEREOF Borrower has executed this Note as of the day and year set
forth above.
BORROWER:
TILDEN TERRACE, L.P.,
a California limited partnership
By: Los Angeles Housing Partnership, Inc.,
a California nonprofit public benefit corporation
Its: Managing General Partner
By: _________________________
Mary Silverstein
Its: President and Executive Director
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EXHIBIT NO. 9
FORM OF RESIDENTIAL DEED OF TRUST
When Recorded Return to:
CULVER CITY REDEVELOPMENT
AGENCY
9770 Culver Boulevard
Culver City, California 90232-0507
Attn: John Fisanotti,
Redevelopment Project Manager
SPACE ABOVE THIS LINE FOR RECORDING USE
Parcel Number: 4213-007-001, 4213-007-901, 4213-007-900 OFFICIAL BUSINESS
Document Entitled to Free Recording
Per Government Code §27383
DEED OF TRUST, SECURITY AGREEMENT AND FIXTURE FILING
(WITH ASSIGNMENT OF RENTS)
BY TILDEN TERRACE, L.P. FOR THE BENEFIT OF
THE CULVER CITY REDEVELOPMENT AGENCY
(HOUSING SET ASIDE FUNDS0
This Deed of Trust, Security Agreement and Fixture Filing (With Assignment of Rents),
dated as of ________________, 2011 is made by TILDEN TERRACE, L.P., a California limited
partnership (hereinafter referred to as “Trustor”), whose address is 1200 Wilshire Boulevard, Suite
307, Los Angeles, California 90017, to LAWYERS TITLE , (hereinafter called “Trustee”), for the
benefit of the CULVER CITY REDEVELOPMENT AGENCY, a public body corporate and politic
(hereinafter called “Beneficiary”), whose address is 9770 Culver Boulevard, Culver City, California
90230-0507.
Witnesseth: That Trustor IRREVOCABLY GRANTS, TRANSFERS AND ASSIGNS to Trustee,
its successors and assigns, in Trust, with POWER OF SALE TOGETHER WITH RIGHT OF
ENTRY AND POSSESSION all present and future right, title and interest of Trustor in and to the
following property (the “Trust Estate”):
(1) All of Trustor’s rights, title and interest in and to that certain real property in the City of
Culver City, County of Los Angeles, State of California more particularly described in Exhibit “A”
attached hereto and by this reference made a part hereof (hereafter referred to as the “Subject
Property”);
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(2) All buildings, structures and other improvements now or in the future located or to be
constructed on the Subject Property (the “Improvements”);
(3) all tenements, hereditaments, appurtenances, privileges, franchises and other rights
and interests now or in the future benefiting or otherwise relating to the Subject Property or the
Improvements, including easements, rights-of-way and development rights (the “Appurtenances”).
(The Appurtenances, together with the Subject Property and the Improvements, are hereafter
referred to as the “Real Property”);
(4) subject to the assignment to Beneficiary set forth in Paragraph 4 below, all rents,
issues, income, revenues, royalties and profits now or in the future payable with respect to or
otherwise derived from the Trust Estate or the ownership, use, management, operation, leasing or
occupancy of the Trust Estate, including those past due and unpaid (the “Rents”);
(5) all inventory, equipment, fixtures and other goods (as those terms are defined in
Division 9 of the California Uniform Commercial Code (the “UCC”), and whether existing now or
in the future) now or in the future located at, upon or about, or affixed or attached to or installed in,
the Real Property, or used or to be used in connection with or otherwise relating to the Real Property
or the ownership, use, development, construction, maintenance, management, operation, marketing,
leasing or occupancy of the Real Property, including furniture, furnishings, machinery, appliances,
building materials and supplies, generators, boilers, furnaces, water tanks, heating ventilating and air
conditioning equipment and all other types of tangible personal property of any kind or nature, and
all accessories, additions, attachments, parts, proceeds, products, repairs, replacements and
substitutions of or to any of such property, but not including personal property that is donated to
Trustor (the “Goods,” and together with the Real Property, the “Property”); and
(6) all accounts, general intangibles, chattel paper, deposit accounts, money, instruments
and documents (as those terms are defined in the UCC) and all other agreements, obligations, rights
and written material (in each case whether existing now or in the future) now or in the future relating
to or otherwise arising in connection with or derived from the Property or any other part of the Trust
Estate or the ownership, use, development, construction, maintenance, management, operation,
marketing, leasing, occupancy, sale or financing of the property or any other part of the Trust Estate,
including (to the extent applicable to the Property or any other portion of the Trust Estate) (i)
permits, approvals and other governmental authorizations, (ii) improvement plans and specifications
and architectural drawings, (iii) agreements with contractors, subcontractors, suppliers, project
managers, supervisors, designers, architects, engineers, sales agents, leasing agents, consultants and
property managers, (iv) takeout, refinancing and permanent loan commitments, (v) warranties,
guaranties, indemnities and insurance policies, together with insurance payments and unearned
insurance premiums, (vi) claims, demands, awards, settlements, and other payments arising or
resulting from or otherwise relating to any insurance or any loss or destruction of, injury or damage
to, trespass on or taking, condemnation (or conveyance in lieu of condemnation) or public use of any
of the Property, (vii) license agreements, service and maintenance agreements, purchase and sale
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agreements and purchase options, together with advance payments, security deposits and other
amounts paid to or deposited with Trustor under any such agreements, (viii) reserves, deposits,
bonds, deferred payments, refunds, rebates, discounts, cost savings, escrow proceeds, sale proceeds
and other rights to the payment of money, trade names, trademarks, goodwill and all other types on
intangible personal property of any kind or nature, and (ix) all supplements, modifications,
amendments, renewals, extensions, proceeds, replacements and substitutions of or to any of such
property (the “Intangibles”).
Trustor further grants to Trustee and Beneficiary, pursuant to the UCC, a security interest in
all present and future right, title and interest of Trustor in and to all Goods and Intangibles and all of
the Trust Estate described above in which a security interest may be created under the UCC
(collectively, the “Personal Property”). This Deed of Trust constitutes a security agreement under
the UCC, conveying a security interest in the Personal Property to Trustee and Beneficiary. Trustee
and Beneficiary shall have, in addition to all rights and remedies provided herein, all the rights and
remedies of a “secured party” under the UCC and other applicable California law. Trustor
covenants and agrees that this Deed of Trust constitutes a fixture filing under Sections 9502(c) and
9604 of the UCC.
FOR THE PURPOSE OF SECURING, in such order of priority as Beneficiary may elect,
all of the following:
(1) Due, prompt and complete observance, performance and discharge of each and every
condition, obligation, covenant and agreement contained herein or contained in the following (the
“Secured Obligations”):
(a) a promissory note in the face amount of $11,805,000, payable from the
residual receipts of the Project, executed by Trustor (“Borrower” therein) of even
date herewith (the “Residential Note”);
(b) the Disposition and Development Agreement dated as of March 21, 2011, by
and between Trustor (“Developer” therein) and Beneficiary (“Agency” therein) (the
“DDA”); and
(c) the Agreement Containing Covenants Affecting Real Property (Including
Affordable Housing Restrictions) dated as of __________, 2011 by and between
Trustor (“Owner” therein) and Beneficiary (“Agency” therein), recorded
concurrently herewith (“Agreement Containing Covenants”).
(2) Payment of indebtedness of the Trustor to the Beneficiary in the principal amount of
$11,805,000 or so much thereof as shall be advanced, evidenced by the Residential Note, with
interest, according to the terms of the Residential Note.
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(3) Payment and performance of all future advances and other obligations that the then
record owner of all or part of the Property may agree to pay and/or perform (whether as principal,
surety or guarantor) for the benefit of Beneficiary, when such future advance of obligation is
evidenced by a writing which recites that it is secured by this Deed of Trust.
The DDA, including all Attachments thereto, and the documents and instruments executed by
Trustor in connection with the Project, including the Agreement Containing Covenants, the
Residential Note, the Assignment of Rents, the Assignment of Agreements, and the UCC1 Financing
Statement, all as described in the DDA and all of their terms are incorporated herein by reference
and this conveyance shall secure any and all extensions, amendments, modifications or renewals
thereof however evidenced. Any capitalized term that is not otherwise defined in this Deed of Trust
shall have the meaning ascribed to such term in the DDA.
AND TO PROTECT THE SECURITY OF THIS DEED OF TRUST, TRUSTOR
COVENANTS AND AGREES:
1. That Trustor shall pay the Residential Note at the time and in the manner provided
therein, and perform the obligations of the Trustor as set forth in the Secured Obligations at the time
and in the manner respectively provided therein;
2. That Trustor shall not permit or suffer the use of any of the Property for any purpose
other than the uses permitted by the Secured Obligations;
3. That the Secured Obligations are incorporated in and made a part of this Deed of
Trust. Upon default of a Secured Obligation, and after the giving of notice and the expiration of any
applicable cure period, the Beneficiary, at its option, may declare the whole of the indebtedness
secured hereby to be due and payable.
4. That, subject to the prior rights, if any, of a lender whose lien is senior to this Deed of
Trust (“Senior Lender”), all rents, profits and income from the Trust Estate are assigned to the
Beneficiary for the purpose of discharging the debt hereby secured. Permission is hereby given to
Trustor so long as no default exists hereunder after the giving of notice and the expiration of any
applicable cure period, to collect such rents, profits and income for use in accordance with the
provisions of the Secured Obligations.
5. That upon default hereunder or under the aforementioned agreements, and after the
giving of notice and the expiration of any applicable cure period, Beneficiary shall be entitled to the
appointment of a receiver by any court having jurisdiction, without notice, to take possession and
protect the Trust Estate and operate same and collect the rents, profits and income therefrom;
6. That Trustor will keep the Improvements insured against loss by fire and such other
hazards, casualties, and contingencies as may reasonably be required in writing from time to time by
the Beneficiary, and all such insurance shall be evidenced by standard fire and extended coverage
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insurance policy or policies. In no event shall the amounts of coverage be less than 100 percent of
the insurable value of the Property. Such policies shall be endorsed with standard mortgage clause
with loss payable to the Beneficiary and certificates thereof together with copies of original policies
shall be deposited with the Beneficiary;
7. To pay, at least 10 days before delinquency, any taxes and assessments affecting the
Property; to pay, when due, all encumbrances, charges and liens, with interest, on the Property or
any part thereof which appear to be prior or superior hereto; and to pay all costs, fees, and expenses
of this Trust. Notwithstanding anything to the contrary contained in this Deed of Trust, Trustor shall
not be required to pay and discharge any such tax, assessment, charge or levy so long as Trustor is
contesting the legality thereof in good faith and by appropriate proceedings, and Trustor has
adequate funds to pay any liabilities contested pursuant to this Section 7.
8. To keep the Property in good condition and repair, subject to ordinary wear and tear,
casualty and condemnation, not to remove or demolish any buildings thereon; to complete or restore
promptly and in good and workmanlike manner any building which may be constructed, damaged,
or destroyed thereon and to pay when due all claims for labor performed and materials furnished
therefor; to comply with all laws affecting the Property or requiring any alterations or improvements
to be made thereon (subject to Trustor’s right to contest the validity or applicability of laws or
regulations); not to commit or permit waste thereof; not to commit, suffer or permit any act upon the
Property in violation of law and/or covenants, conditions and/or restrictions affecting the Property;
not to permit or suffer any material alteration of or addition to the Improvements without the consent
of the Beneficiary;
9. To appear in and defend any action or proceeding purporting to affect the security
hereof or the rights or powers of Beneficiary or Trustee, and to pay all costs and expenses, including
cost of evidence of title and reasonable attorney’s fees in a reasonable sum, in any such action or
proceeding in which Beneficiary or Trustee may appear;
10. Should Trustor fail to make any payment or do any act as herein provided, then
Beneficiary or Trustee, but without obligation so to do and without notice to or demand upon Trustor
and without releasing Trustor from any obligation hereof, may make or do the same in such manner
and to such extent as either may deem necessary to protect the security hereof. Following default,
after the giving of notice and the expiration of any applicable cure period, Beneficiary or Trustee
being authorized to enter upon said property for such purposes, may commence, appear in and/or
defend any action or proceeding purporting to affect the security hereof or the rights or powers of
Beneficiary or Trustee; may pay, purchase, contest, or compromise any encumbrance, charge, or lien
which in the judgment of either appears to be prior or superior hereto; and, in exercising any such
powers, may pay necessary expenses, employ counsel, and pay reasonable attorney fees.
Notwithstanding the foregoing, in the event of default under this Deed of Trust, the Beneficiary may
also require Trustor to maintain and submit additional records. Beneficiary shall specify in writing
the particular records that must be maintained and the information or reports that must be submitted;
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11. Beneficiary shall have the right to pay fire and other property insurance premiums
when due should Trustor fail to make any required premium payments. All such payments made by
the Beneficiary shall be added to the principal sum secured hereby;
12. To pay immediately and without demand all sums so expended by Beneficiary or
Trustee, under permission given under this Deed of Trust, with interest from date of expenditure at
the rate specified in the Residential Note;
13. That the funds to be advanced hereunder are to be used in accordance with the
Secured Obligations and upon the failure of Trustor to keep and perform all the covenants,
conditions, and agreements of said agreements, the principal sum and all arrears of interest, and
other charges provided for in the Residential Note shall at the option of the Beneficiary of this Deed
of Trust become due and payable, anything contained herein to the contrary notwithstanding;
14. Trustor further covenants that it will not voluntarily create, suffer, or permit to be
created against the property subject to this Deed of Trust any lien or liens except as permitted by the
Secured Obligations or otherwise approved by Beneficiary, and further that it will keep and maintain
the Property free from the claims of all persons supplying labor or materials which will enter into the
construction of any and all buildings now being erected or to be erected on said premises.
Notwithstanding anything to the contrary contained in this Deed of Trust, Trustor shall not be
obligated to pay any claims for labor, materials or services which Trustor in good faith disputes and
is diligently contesting, provided that Trustor shall, at Beneficiary’s written request, within thirty
(30) days after the filing of any claim or lien (but in any event, and without any requirement that
Beneficiary must first provide a written request, prior to foreclosure) record in the Office of the
Recorder of Los Angeles County, a surety bond in an amount one-and-one-half (12) times the
amount of such claim item to protect against a claim of lien, or provide such other security
reasonably satisfactory to Beneficiary;
15. That any and all improvements made or about to be made upon the premises covered
by the Deed of Trust, and all plans and specifications, comply with all applicable municipal
ordinances and regulations and all other applicable regulations made or promulgated, now or
hereafter, by lawful authority, and that the same will upon completion comply with all such
municipal ordinances and regulations and with the rules of the applicable fire rating or inspection
organization, bureau, association or office;
16. Trustor herein agrees to pay to Beneficiary or to the authorized loan servicing
representative of the Beneficiary a reasonable charge for providing a statement regarding the
obligation secured by this Deed of Trust as provided by Section 2954, Article 2, Chapter 2 Title 14,
Division 3, of the California Civil Code.
IT IS MUTUALLY AGREED THAT:
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17. Should the Property or any part thereof be taken or damaged by reason of any public
improvement or condemnation proceeding, or damaged by fire, or earthquake, or in any other
manner, subject to the rights of Senior Lender, Beneficiary shall be entitled to all compensation,
awards, and other payments or relief therefor which are not used to reconstruct, restore or otherwise
improve the Property or part thereof that was taken or damaged, and shall be entitled at its option to
commence, appear in and prosecute in its own name, any action or proceedings, or to make any
compromise or settlement, in connection with such taking or damage. Subject to the rights of the
Senior Lenders, all such compensation, awards, damages, rights of action and proceeds which are
not used to reconstruct, restore or otherwise improve the Property or part thereof that was taken or
damaged, including the proceeds of any policies of fire and other insurance affecting the Property,
are hereby assigned to Beneficiary. After deducting therefrom all its expenses, including attorney’s
fees, the balance of the proceeds which are not used to reconstruct, restore or otherwise improve the
Property or part thereof that was taken or damaged, shall be applied to the amount due under the
Residential Note secured hereby. No amount applied to the reduction of the principal shall relieve
the Trustor from making regular payments as required by the Residential Note. If the Residential
Note has been repaid in full, the remainder of the balance shall revert to the Trustor;
18. Upon default by Trustor in making any payments provided for in the Residential Note
secured hereby or in this Deed of Trust, or in performing any obligation set forth in any of the
Secured Obligations, and if such default is not cured within the respective time provided therefor in
Section 34 of this Deed of Trust, below, Beneficiary may declare all sums secured hereby
immediately due and payable by delivery to Trustee of written declaration of default and demand for
sale, and of written notice of default and of election to cause the property to be sold, which notice
Trustee shall cause to be duly filed for record and Beneficiary may foreclose this Deed of Trust.
Beneficiary shall also deposit with Trustee this Deed of Trust, the Note and all documents
evidencing expenditures secured hereby;
19. a. Prior to the repayment in full of the Residential Loan, the Trustor shall not
assign or attempt to assign the DDA or any right therein, nor make any total or partial sale, transfer,
conveyance or assignment of the whole or any part of the Property, the Improvements, or any
portion thereof or interest therein (referred to hereinafter as a “Transfer”), without prior written
approval of the Beneficiary, except as otherwise permitted in the Secured Obligations. Consent to
one such transaction shall not be deemed to be a waiver of the right to require consent to future or
successive transactions. Beneficiary shall not unreasonably withhold or delay its consent. If consent
should be given, any such transfer shall be subject to this Section 19, and any such transferee shall
assume all obligations hereunder and agree to be bound by all provisions contained herein, subject to
the provisions of paragraph e.(3) of this Section 19, below.
b. Any such proposed transferee shall have the qualifications and financial
responsibility necessary and adequate as may be reasonably determined by the Beneficiary, to fulfill
the obligations undertaken by Trustor in the Secured Obligations. Any such proposed transferee, by
instrument in writing satisfactory to the Beneficiary and in form recordable among the land records
of Orange County, for itself and its successors and assigns, and for the benefit of the Beneficiary
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shall expressly assume all of the obligations of the Trustor under the Secured Obligations, and agree
to be subject to all conditions and restrictions applicable to the Trustor in this Deed of Trust, subject
to the provisions of paragraph e.(3) of this Section 19. There shall be submitted to the Beneficiary
for review all instruments and other legal documents proposed to effect any such transfer; and if
approved by the Beneficiary its approval shall be indicated to the Trustor in writing.
c. In the absence of specific written agreement by the Beneficiary, no Transfer,
or approval thereof by the Beneficiary, shall be deemed to relieve the Trustor or any other party
from any obligations under the Secured Obligations.
d. In the event of a Transfer prior to the time the Residential Loan is paid in full
and without the prior written consent of the Beneficiary, the net proceeds (after repayment in full of
the Senior Loan and the reconveyance of the Senior Deed of Trust), shall be paid to the Beneficiary
to the extent necessary to pay in full the accrued interest, if any, current interest and remaining
principal balance of the Residential Loan.
e. (1) As used herein, “Transfer” includes the sale, agreement to sell, transfer
or conveyance of the Property, the Project, or any portion thereof or interest therein, whether
voluntary, involuntary, by operation of law or otherwise, the execution of any installment sale
contract or similar instrument affecting all or a portion of the Property or Project, the lease of all or
substantially all of the Property or Project, except as provided in subparagraph (3) below, or the
appointment of a receiver or trustee to operate or exercise direct or indirect control over any portion
of or interest in the Project or to operate or exercise direct or indirect control over any interest in any
general partner or member of Trustor or any general partner or member of a general partner or
member of Trustor.
(2) “Transfer” shall also include the transfer, assignment, hypothecation or
conveyance of legal or beneficial ownership of any interest in Developer or any general partner or
member of Trustor or of any general partner or member of a general partner or member of Trustor,
or any conversion of Trustor to an entity form other than that of Trustor at the time of execution of
this Agreement, except that, a cumulative change in ownership interest of any general partner of the
Trustor of forty-nine percent (49%) or less shall not be deemed a “Transfer” for purposes of this
Agreement.
(3) Notwithstanding paragraphs (1) and (2), “Transfer” shall not include
any of the following Permitted Transfers:
(i) a conveyance of a security interest to the beneficiary of the Senior Deed of
Trust or the conveyance of title to the Property or Project in connection with a foreclosure, a
deed in lieu of foreclosure or similar conversion of such loan;
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(ii) (1) A conveyance of the Project to a limited partnership in which the
Managing General Partner is Trustor or Trustor’s Managing General Partner, or a sale back from
such partnership to Trustor or such Managing General Partner.
(2) The substitution of a General Partner as directed by the Investor
Limited Partner in accordance with the terms of the Limited Partnership Agreement, subject to
the following terms and conditions. The Investor Limited Partner may substitute the Special
Limited Partner (or another reasonably acceptable Affiliate of Investor Limited Partner) (the
“Interim General Partner”) on an interim basis for a period reasonably calculated to identify and
admit into the partnership a new General Partner, as set forth below (the “Substitute General
Partner”). The Substitute General Partner must be an entity reasonably acceptable to the Agency,
which approval shall not be unreasonably withheld or delayed.
(iii) Any refinancing that repays any of the Senior Loan (referred to herein as a
“Take-out Loan”), if Beneficiary reasonably determines (which determination shall not be
unreasonably withheld) that (i) the resulting loan-to-value ratio (including the Take-out Loan,
any of the remaining Senior Loan not repaid by the refinancing) will not exceed the loan-to-
value ratio in effect at the time of the Permanent Financing Event for the initial development of
the Project, and the repayment terms of the Take-out Loan do not materially impair the Trustor’s
ability to repay the Residential Loan or (ii) the Take-out Loan is replacing a matured Senior
Loan and the amount of the Take-out Loan is equal to, or less than, the amount owing on the
matured Senior Loan.
(iv) The leasing for occupancy of all or any part of the Property or Project in
accordance with this Agreement and the Agreement Containing Covenants.
(v) The inclusion of equity participation by Trustor by transfer or addition of
limited partners to the Trustor or similar mechanism; provided that such transfer, addition or
other mechanism shall not involve any Prohibited Person or otherwise result in a violation of
Anti-Terrorism Laws.
(vi) The pledge by a General Partner to the Investor Limited Partner of the
General Partner’s interest in Trustor, as security for the performance of all of the General
Partner’s obligations under the Limited Partnership Agreement.
(vii) The sale, transfer or pledge of any limited partnership interest in the Trustor
or of any partnership interest in the Investor Limited Partner; provided that such sale, transfer or
pledge shall not be to any Prohibited Person or otherwise result in a violation of Anti-Terrorism
Laws.
(viii) Any dilution of the General Partner’s interest in the Trustor in accordance
with the Limited Partnership Agreement.
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20. After the lapse of such time as may then be required by law following the recordation
of a notice of default, and notice of sale having been given as then required by law, Trustee, without
demand on Trustor, shall sell the Property at the time and place fixed by it in the notice of sale,
either as a whole or in separate parcels, and in such order as it may determine at public auction to the
highest bidder for cash in lawful money of the United States, payable at time of sale. Trustee may
postpone sale of all or any portion of the Property by public announcement at the time and place of
sale, and from time to time thereafter may postpone the sale by public announcement at the time and
place of sale, and from time to time thereafter may postpone the sale by public announcement at the
time fixed by the preceding postponement. Trustee shall deliver to the purchaser its deed conveying
the property so sold, but without any covenant or warranty, express or implied. The recitals in the
deed of any matters or facts shall be conclusive proof of the truthfulness thereof. Any person,
including Trustor, Trustee or Beneficiary, may purchase at the sale. The Trustee shall apply the
proceeds of sale to payment of (1) the expenses of such sale, together with the reasonable expenses
of this trust including therein reasonable Trustee’s fees or attorney’s fees for conducting the sale,
and the actual cost of publishing, recording, mailing and posting notice of the sale; (2) the cost of
any search and/or other evidence of title procured in connection with such sale and revenue stamps
on Trustee’s deed; (3) all sums expended under the terms hereof, not then repaid, with accrued
interest at the rate specified in the Residential Note; (4) all other sums then secured hereby; and (5)
the remainder, if any, to the person or persons legally entitled thereto;
21. Beneficiary may from time to time substitute a successor or successors to any Trustee
named herein or acting hereunder to execute this Trust. Upon such appointment, and without
conveyance to the successor trustee, the latter shall be vested with all title, powers, and duties
conferred upon any Trustee herein named or acting hereunder. Each such appointment and
substitution shall be made by written instrument executed by Beneficiary, containing reference to
this Deed of Trust and its place of record, which, when duly recorded in the proper office of the
county or counties in which the property is situated, shall be conclusive proof of proper appointment
of the successor trustee;
22. The pleading of any statute of limitations as a defense to any and all obligations
secured by this Deed of Trust is hereby waived to the full extent permissible by law;
23. Upon written request of Beneficiary stating that all sums secured hereby have been
paid and all obligations secured hereby have been satisfied, including but not limited to the
obligations set forth in the Agreement Containing Covenants, and upon surrender of this Deed of
Trust and any note, instrument or instruments setting forth all obligations secured hereby to Trustee
for cancellation and retention and upon payment of its fees, Trustee shall reconvey, without
warranty, the Property then held hereunder. The recitals in such reconveyance of any matters or fact
shall be conclusive proof of the truthfulness thereof. To the extent permitted by law, the grantee in
such reconveyance may be described as “the person or persons legally entitled thereto.” Neither
Beneficiary nor Trustee shall have any duty to determine the rights of persons claiming to be rightful
grantees of any reconveyance. When the Property has been fully reconveyed, the last such
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reconveyance shall operate as a reassignment of all future rents, issues and profits of the Property to
the person or persons legally entitled thereto;
24. The trust created hereby is irrevocable by Trustor;
25. This Deed of Trust applies to, inures to the benefit of, and binds all parties hereto,
their heirs, legatees, devisees, administrators, executors, successors, and assigns. The term
“Beneficiary” shall include not only the original Beneficiary hereunder but also any future owner
and holder including pledgees, of the Residential Note secured hereby. In this Deed of Trust,
whenever the context so requires, the masculine gender includes the feminine and/or neuter, and the
singular number includes the plural. All obligations of Trustor hereunder are joint and several;
26. Trustee accepts this Trust when this Deed of Trust, duly executed and acknowledged,
is made public record as provided by law. Except as otherwise provided by law the Trustee is not
obligated to notify any party hereto of pending sale under this Deed of Trust or of any action or
proceeding in which Trustor, Beneficiary, or Trustee shall be a party unless brought by Trustee.
Beneficiary, at its option, may from time to time remove Trustee and appoint a successor trustee to
any Trustee appointed hereunder. Without conveyance of the Property, the successor trustee shall
succeed to all the title, power and duties conferred upon the Trustee herein and by applicable law;
27. The undersigned Trustor requests that a copy of any notice of default and of any
notice of sale hereunder be mailed to Trustor at the address set forth on the first page of this Deed of
Trust.
28. Trustor agrees at any time and from time to time upon receipt of a written request
from Beneficiary, to furnish to Beneficiary detailed statements in writing of income, rents, profits,
and operating expenses of the premises, and the names of the occupants and tenants in possession,
together with the expiration dates of their leases and full information regarding all rental and
occupancy agreements, and the rents provided for by such leases and rental and occupancy
agreements, and such other information regarding the premises and their use as may be requested by
Beneficiary.
29. Trustor agrees that the loan secured by this Deed of Trust is made expressly for the
purpose of financing the construction of Improvements on the Property, including 32 dwelling units
of affordable housing for Very Low Income, Low Income and Moderate Income Households, and
such dwelling units shall be occupied exclusively by such persons as set forth in the Secured
Obligations.
30. Trustor agrees that, except as otherwise provided in the Residential Note, upon sale
or refinancing of the property, the entire principal balance of the debt secured by this Deed of Trust,
plus any accrued but unpaid interest thereon, shall at the option of Beneficiary be immediately due
and payable.
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31. a. The obligation to repay the Residential Loan is a nonrecourse obligation of
the Trustor and its partners. Neither the Trustor nor any of its general or limited partners, nor any
other party, shall have any personal liability for repayment of the loan. The sole recourse of the
Beneficiary with respect to repayment of the Residential Loan shall be the exercise of its rights
against the Property and the improvements thereon and any related security for the Residential Loan.
Provided, however, that the foregoing shall not (i) constitute a waiver of any obligation evidenced
by the Residential Loan Documents, the Agreement Containing Covenants or the Environmental
Indemnity; (ii) prevent or in any way hinder the Beneficiary from exercising, or constitute a defense,
an affirmative defense, a counterclaim, or other basis for relief in respect of the exercise of, any
remedy prescribed by law or in equity in case of default, other than repayment of the Residential
Loan; or (iii) relieve Trustor of any of its obligations under any indemnity delivered by Trustor to
the Beneficiary. The foregoing provisions of this paragraph are limited by the provision that in the
event of the occurrence of a default, Trustor and its successors and assigns shall have personal
liability hereunder for any deficiency judgment, but only if and to the extent Trustor, its principals,
shareholders, partners or its successors and assigns received rentals, other revenues, or other
payments or proceeds in respect of the mortgaged Property after the occurrence of such default,
which rentals, other revenues, or other payments or proceeds have not been used for the payment of
ordinary and reasonable operating expenses of the mortgaged Property, ordinary and reasonable
capital improvements to the mortgaged Property, debt service, real estate taxes in respect of the
mortgaged Property and basic management fees, but not incentive fees, payable to an entity or
person unaffiliated with Trustor in connection with the operation of the mortgaged Property, which
are then due and payable.
b. Notwithstanding the foregoing, the Beneficiary may obtain a judgment or order
(including, without limitation, an injunction) requiring any Person to perform (or refrain from)
specified acts other than repayment of the Residential Loan; may proceed against any Person
whatsoever with respect to the enforcement of any guarantees, surety bonds, letters of credit,
reimbursement agreements or similar rights to payment or performance; and may recover directly
from any Person:
(i) any damages, costs and expenses incurred by Beneficiary as a result of fraud,
misrepresentation or any criminal act or acts of Trustor or any member,
partner, shareholder, officer, director or employee of (a) Trustor or (b) any of
Trustor’s members or general partners or (c) any member or partner of any of
Trustor’s members or general partners;
(ii) any damages, costs and expenses incurred by the Beneficiary as a result of
any misappropriation of funds provided for the construction of the Project,
rents and revenues from the operation of the Project, or proceeds of insurance
policies or condemnation proceeds;
(iii) any and all amounts owing by Trustor pursuant to Trustor’s indemnification
regarding Hazardous Substances; and
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(iv) all court costs and attorneys’ fees reasonably incurred in enforcing or
collecting upon any of the foregoing exceptions.
32. Notwithstanding specific provisions of this Deed of Trust, non-monetary performance
hereunder shall not be deemed to be in default where delays or defaults are proximately caused by
any of the following Force Majeure events, provided such event actually delays and interferes with
the timely performance of the matter, and, despite the exercise of diligence and good business
practices, such event is beyond the reasonable control of Trustor: War; insurrection; strikes; lock-
outs; 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 including litigation challenging the validity of this transaction or any element
thereof; unusually severe weather; inability to secure necessary labor, materials or tools; delays of
any contractor, subcontractor, or suppliers; acts of the other party; acts or failure to act of any
Governmental Authority (except acts or failure to act of the Beneficiary shall not excuse
performance by the Beneficiary); the imposition of any applicable moratorium by a Governmental
Authority; or any other causes which despite the exercise of diligence and good business practices
are or would be beyond the reasonable control of the party claiming such delay and interference.
Notwithstanding the foregoing, none of the foregoing events shall constitute a Force Majeure Event
unless and until Trustor delivers to Beneficiary written notice describing the event, its cause, when
and how Trustor obtained knowledge, the date the event commenced, and the estimated delay
resulting therefrom. Trustor shall deliver such written notice within ten (10) business days after it
obtains actual knowledge of the event.
33. If the rights and liens created by this Deed of Trust shall be held by a court of
competent jurisdiction to be invalid or unenforceable as to any part of the Secured Obligations, the
unsecured portion of such obligations shall be completely performed and paid prior to the
performance and payment of the remaining and secured portion of the obligations, and all
performance and payments made by Trustor shall be considered to have been performed and paid on
and applied first to the complete payment of the unsecured portion of the obligations.
34. (a) Subject to the extensions of time set forth in Section 32, and subject to the further
provisions of this Section 34, failure or delay by Trustor to perform any term or provision
respectively required to be performed under the Secured Obligations or this Deed of Trust
constitutes a default under this Deed of Trust.
(b) Beneficiary shall give written notice of default to Trustor, specifying the
default complained of by the Beneficiary. Failure or delay in giving such notice shall not constitute
a waiver of any default nor shall it change the time of default.
(c) Any failures or delays by Beneficiary 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. Delays by Beneficiary in asserting any of its rights and remedies shall not deprive
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Beneficiary 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.
(d) If a monetary event of default occurs, prior to exercising any remedies
hereunder, Beneficiary shall give Trustor written notice of such default. Trustor shall have a period
of ten (10) days after such notice is given within which to cure the default prior to exercise of
remedies by Beneficiary.
(e) If a non-monetary event of default occurs, prior to exercising any remedies
hereunder, Beneficiary shall give Trustor notice of such default. If the default is reasonably capable
of being cured within thirty (30) days, Trustor shall have such period to effect a cure prior to
exercise of remedies by Beneficiary. If the default is such that it is not reasonably capable of being
cured within thirty (30) days, and Trustor (i) initiates corrective action within said period, and (ii)
diligently, continually, and in good faith works to effect a cure as soon as possible, then Trustor shall
have such additional time as is reasonably necessary to cure the default prior to exercise of any
remedies by Beneficiary. If Trustor fails to take corrective action or cure the default within a
reasonable time, Beneficiary shall give Trustor and, as provided in paragraph (f), below, the Investor
Limited Partner, notice thereof, whereupon the Investor Limited Partner may remove and replace the
general partner with a substitute general partner, who shall effect a cure within a reasonable time
thereafter in accordance with the foregoing provisions. Beneficiary agrees to accept cures tendered
by the Investor Limited Partner within the cure periods provided in this Deed of Trust or within the
time periods provided in Civil Code Section 2924c, whichever is longer. Additionally, in the event
the Investor Limited Partner is precluded from curing a non-monetary default due to an inability to
remove the General Partner as a result of a bankruptcy, injunction, or similar proceeding by or
against Trustor or its General Partner, Beneficiary agrees to forbear from completing a foreclosure
(judicial or nonjudicial) during the period during which the Investor Limited Partner is so precluded
from acting, not to exceed 90 days, provided such limited partner is otherwise in compliance with
the foregoing provisions. In no event shall Beneficiary be precluded from exercising remedies if its
security becomes or is about to become materially jeopardized by any failure to cure a default or the
default is not cured within ninety (90) days after the first notice of default is given.
(f) After Trustor gives written notice to Beneficiary that the Investor Limited
Partner has been admitted to the Trustor, Beneficiary shall send to the Investor Limited Partner a
copy of all notices of default and all other notices that Beneficiary sends to Trustor, at the address
for the limited partner as provided by written notice to Beneficiary by Trustor.
(g) Except as otherwise required to comply with the provisions of California Civil
Code Section 2924 et seq. that are applicable thereto, any notice of default that is transmitted by
electronic facsimile transmission followed by delivery of a “hard” copy, shall be deemed delivered
upon its transmission; any notice of default that is personally delivered (including by means of
professional messenger service, courier service such as United Parcel Service or Federal Express, or
by U.S. Postal Service), shall be deemed received on the documented date of receipt by Trustor; and
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any notice of default that is sent by registered or certified mail, postage prepaid, return receipt
required shall be deemed received on the date of receipt thereof.
35. This Deed of Trust shall be subordinate and junior to the Senior Deed of Trust, as
described in the DDA. The Executive Director of the Beneficiary or his designee shall execute such
instruments as may be necessary to subordinate the lien of this Deed of Trust, to the deed of trust
securing any Senior Loan. In the event of a default or breach by Trustor of any security instrument
securing a Senior Loan described in this Section 35, Beneficiary shall have the right to cure the
default prior to completion of any foreclosure. In such event, Beneficiary shall be entitled to
reimbursement by Trustor of all costs and expenses incurred by Beneficiary in curing the default.
The amount of any such disbursements shall be a lien against the Property and added to the
obligation secured by this Deed of Trust until repaid, with interest at the highest rate permitted by
law.
38. This Deed of Trust shall be subject to the terms and conditions set forth in that certain
Subordination Agreement, dated on or about the date hereof, by and among the Trustor, Senior
Lender and Beneficiary, as the same may be amended, restated, supplemented or modified from time
to time.
39. The Trustor has informed the Beneficiary that Trustor intends that the Project qualify
for an allocation of low-income housing tax credits under Section 42 of the Internal Revenue Code
(“Nine Percent Tax Credit”). In order to receive an allocation of tax credits, the Trustor will be
required to record in the real property records of the County of Los Angeles an “extended low-
income housing commitment” (as defined in Code Section 42(h)(6)(B)) (the “Extended Use
Agreement”). If the Trustor demonstrates to the reasonable satisfaction of Beneficiary that the
California Department of Housing and Community Development or applicable federal law requires
that the lien of this Deed of Trust be subordinate to the Extended Use Agreement, then the
Beneficiary shall execute a subordination agreement (“Extended Use Subordination Agreement”)
wherein the lien of this Deed of Trust is subordinated to the Extended Use Agreement. The
Extended Use Subordination Agreement will:
(a) provide that, if the Beneficiary or its successors or assigns (collectively, the
“REO Owner”) acquires the Property by foreclosure (or instrument in lieu of foreclosure), then the
“extended use period” (as defined in Code Section 42(h)(6)(D)) shall terminate, except for the
obligation of the REO Owner to comply with the limitations on evictions, termination of tenancy
and increase in rents for the three year period following the REO Owner’s acquisition of the
mortgaged property, as set forth in Code Section 42(h)(6)(E)(ii); and
(b) otherwise be in a form reasonably acceptable to Beneficiary.
[Remainder of Page Intentionally Left Blank; Signature Pages Follow]
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IN WITNESS WHEREOF Trustor has executed this Deed of Trust as of the day and year set
forth above.
“TRUSTOR”
TILDEN TERRACE, L.P.,
a California limited partnership
By: Los Angeles Housing Partnership, Inc.,
a California nonprofit public benefit corporation
Its: Managing General Partner
By: _________________________
Mary Silverstein
Its: President and Executive Director
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APPROVED BY:
“AGENCY”
CULVER CITY REDEVELOPMENT AGENCY,
a public body corporate and politic
By: _________________________________
John M. Nachbar
Executive Director
ATTEST:
By: _________________________________
Agency Secretary
APPROVED AS TO FORM:
By: _________________________________
General Counsel
By: _________________________________
KANE, BALLMER & BERKMAN
Agency Special Counsel
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]
State of California )
County of Los Angeles )
On ________________________________________ before me, __________________,
a Notary Public, personally appeared ______________________________, who proved to me
on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature_______________________________________ (Seal)
State of California )
County of Los Angeles )
On ________________________________________ before me, __________________,
a Notary Public, personally appeared ______________________________, who proved to me
on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature_______________________________________ (Seal)
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Exhibit A
LEGAL DESCRIPTION
ALL THAT CERTAIN REAL PROPERTY SITUATED IN THE COUNTY OF LOS
ANGELES, STATE OF CALIFORNIA, DESCRIBED AS FOLLOWS:
LOTS 1 AND 2 OF TRACT NO. 9648, IN THE CITY OF CULVER CITY COUNTY OF LOS
ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 142, PAGES 13, 14
AND 15 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY
And
LOT 3 OF TRACT 9648, AS SHOWN ON A MAP RECORDED IN BOOK 142, PAGES 13,
INCLUSIVE OF MISCELLANEOUS MAPS, RECORDS OF LOS ANGELES COUNTY,
CALIFORNIA
And
LOTS 4, 5, 6, 7 AND 8 OF TRACT NO. 9648, IN THE CITY OF CULVER CITY, COUNTY OF
LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 142,
PAGES(S) 13 TO 15 INCLUSIVE OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER
OF SAID COUNTY.
APN: 4213-007-001, 4213-007-901, 4213-007-900
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EXHIBIT NO. 10
FORM OF AGREEMENT CONTAINING COVENANTS
When Recorded Return to:
CULVER CITY REDEVELOPMENT
9770 Culver Boulevard
Culver City, California 90232-0507
Attn: John Fisanotti,
Redevelopment Project Manager
SPACE ABOVE THIS LINE FOR RECORDING USE
Parcel Number: 4213-007-001, 4213-007-901, 4213-007-900 OFFICIAL BUSINESS
Document Entitled to Free Recording
Per Government Code §27383
AGREEMENT CONTAINING COVENANTS AFFECTING REAL PROPERTY
(INCLUDING AFFORDABLE HOUSING RESTRICTIONS)
THIS AGREEMENT CONTAINING COVENANTS AFFECTING REAL PROPERTY
(INCLUDING AFFORDABLE HOUSING RESTRICTIONS) (“Agreement”) dated for
identification purposes only _____________, 2011 is entered by and between THE CULVER
CITY REDEVELOPMENT AGENCY, a public body, corporate and politic (“Agency”) and
TILDEN TERRACE, a California limited partnership (“Owner”).
RECITALS:
A. Agency is responsible for the use of certain low- and moderate-income housing
funds pursuant to California’s Community Redevelopment Law [California Health & Safety
Code §§33000, et seq.] (“Set Aside Funds”).
B. Agency and Owner (“Developer” therein) have entered into that certain
Disposition and Development Agreement, dated as of March 21, 2011 (the “DDA”), concerning
Owner’s development and operation of that certain real property more particularly described in
Exhibit No. 1 attached hereto and incorporated by reference herein (the “Property”). The DDA
describes the “Project” which generally consists of Owner’s development on the Property of a
total of thirty-three (33) dwelling units and approximately 10,700 square feet of commercial
space and subsequent operation thereof as a rental housing complex. All of the dwelling units,
with the exception of one manager’s unit are to be restricted to occupancy by Very Low Income,
Low Income and Moderate Income Households. The DDA is hereby incorporated herein by this
reference as though fully set forth herein. Any capitalized terms not defined herein shall have
the meanings ascribed to such terms in the DDA.
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D. Owner has executed that certain promissory note (the “Residential Note”) dated
on or about the date hereof, pursuant to which Agency has provided Owner with a loan of Set
Aside Funds in the principal amount of Eleven Million Eight Hundred Five Thousand Dollars
($11,805,000). The Residential Note is secured by a Deed of Trust with Assignment of Rents
dated on or about the date of the Note, naming Agency as beneficiary (“Residential Deed of
Trust”).
F. Agency and Owner now desire to place restrictions upon the use and operation of
the Project, in order to ensure that thirty-two (32) of the dwelling units in the Project shall be
operated continuously as affordable housing available for rental to Very Low Income, Low
Income and Moderate Income Households in accordance with the terms set forth below for the
term of this Agreement.
AGREEMENT:
NOW, THEREFORE, the Owner and Agency declare, covenant and agree, by and for
themselves, their heirs, executors, administrators and assigns, and all persons claiming under or
through them, that the Property, for the term of this agreement, shall be held transferred,
encumbered, used, sold, conveyed, leased and occupied, subject to the covenants and restrictions
hereinafter set forth:
1. DEFINITIONS.
1.1 Affordable Rent. The term “Affordable Rent” shall mean the monthly
payments charged to and paid by tenants to the Owner for the use and occupancy of a Restricted
Unit and facilities associated therewith, including a reasonable allowance for utilities.
Affordable Rent shall mean
(a) for Very Low Income Units, rental rates not to exceed thirty percent (30%) times
fifty percent (50%) of Area Median Income adjusted for household size appropriate to the unit.
(b) for Low Income Units, rental rates not to exceed thirty percent (30%) times sixty
percent (60%) of Area Median Income adjusted for household size appropriate to the unit.
(c) for Moderate Income Units, rental rates not to exceed thirty percent (30%) times
one hundred ten percent (110%) of Area Median Income adjusted for household size appropriate
to the unit.
As used in this definition of “Affordable Rent” the phrase “adjusted for household size
appropriate to the unit” means a household size equal to the number of bedrooms in the unit plus
one. Affordable Rent shall include a reasonable utility allowance for tenant-paid utilities based
on the Los Angeles County Housing Authority’s published utility schedules.
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1.2 Area Median Income. The term “Area Median Income” shall mean the
area median income of Los Angeles County, with adjustments for household size, as estimated
annually by the United States Department of Housing and Urban Development pursuant to
Section 8 of the United States Housing Act of 1937 as amended and published by California’s
Housing and Community Development Department pursuant to Health and Safety Code section
50093.
1.3 Eligible Tenant. The term “Eligible Tenant” shall mean any person
entitled to rent a Very Low Income Unit, a Low Income Unit or a Moderate Income Unit as set
forth in this Agreement.
1.4 Low Income Household. The term “Low Income Household” shall have
meaning given to “lower income households” in Health and Safety Code section 50079.5(a),
generally being a household whose income does not exceed 80% of the Area Median Income
adjusted for family size.
1.5 Low Income Units. The term “Low Income Units” shall mean the four (4)
two-bedroom and two (2) three-bedroom rental dwelling units in the Project restricted to
occupancy by Low Income Households. The term “Low Income Unit” shall mean each of the
Low Income Units.
1.6 Moderate Income Household. The term “Moderate Income Household”
shall mean a household whose income does not exceed 120% of Area Median Income adjusted
for family size.
1.7 Moderate Income Units. The term “Moderate Income Units” shall mean
the seven (7) two-bedroom and five (5) three-bedroom rental dwelling units in the Project
restricted to occupancy by Moderate Income Households. The term “Moderate Income Unit”
shall mean each of the Moderate Income Units.
1.8 Restricted Unit. The term “Restricted Unit” shall mean each of the Very
Low Income, Low Income and Moderate Income Units.
1.9 Transfer. The term “Transfer” shall mean:
(i) the sale, agreement to sell, transfer or conveyance of the Property, the Project, or any
portion thereof or interest therein, whether voluntary, involuntary, by operation of law or
otherwise, the execution of any installment sale contract or similar instrument affecting all or a
portion of the Property or Project, the lease of all or substantially all of the Property or Project,
except as provided in subparagraph (iii) below, or the appointment of a receiver or trustee to
operate or exercise direct or indirect control over any portion of or interest in the Project or to
operate or exercise direct or indirect control over any interest in any general partner or member
of Owner or any general partner or member of a general partner or member of Owner.
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(ii) “Transfer” shall also include the transfer, assignment, hypothecation or conveyance
of legal or beneficial ownership of any interest in Owner or any general partner or member of
Owner or of any general partner or member of a general partner or member of Owner, or any
conversion of Owner to an entity form other than that of Owner at the time of execution of this
Agreement, except that, a cumulative change in ownership interest of any general partner of the
Owner of forty-nine percent (49%) or less shall not be deemed a “Transfer” for purposes of this
Agreement.
(iii) Notwithstanding paragraphs (i) and (ii), “Transfer” shall not include any of the
following Permitted Transfers:
(A) a conveyance of a security interest to the beneficiary of the Senior Deed of
Trust or the conveyance of title to the Property or Project in connection with a foreclosure, a
deed in lieu of foreclosure or similar conversion of such loan;
(B) (1) A conveyance of the Project to a limited partnership in which the
Managing General Partner is Owner or Owner’s Managing General Partner, or a sale back from
such partnership to Owner or such Managing General Partner.
(2) The substitution of a General Partner as directed by the Investor
Limited Partner in accordance with the terms of the Limited Partnership Agreement, subject to
the following terms and conditions. The Investor Limited Partner may substitute the Special
Limited Partner (or another reasonably acceptable Affiliate of Investor Limited Partner) (the
“Interim General Partner”) on an interim basis for a period reasonably calculated to identify and
admit into the partnership a new General Partner, as set forth below (the “Substitute General
Partner”). The Substitute General Partner must be an entity reasonably acceptable to the Agency,
which approval shall not be unreasonably withheld or delayed.
(C) Any refinancing that repays any of the Senior Loan (referred to herein as a
“Take-out Loan”), if the Agency reasonably determines (which determination shall not be
unreasonably withheld) that (i) the resulting loan-to-value ratio (including the Take-out Loan and
any of the remaining Senior Loan not repaid by the refinancing) will not exceed the loan-to-
value ratio in effect at the time of the Permanent Financing Event for the initial development of
the Project, and the repayment terms of the Take-out Loan do not materially impair the Owner’s
ability to repay the Residential Loan or (ii) the Take-out Loan is replacing a matured Senior
Loan and the amount of the Take-out Loan is equal to, or less than, the amount owing on the
matured Senior Loan.
(D) The leasing for occupancy of all or any part of the Property or Project in
accordance with this Agreement and the Agreement Containing Covenants.
(E) The inclusion of equity participation by Owner by transfer or addition of
limited partners to the Owner or similar mechanism; provided that such transfer, addition or
other mechanism shall not involve any Prohibited Person or otherwise result in a violation of
Anti-Terrorism Laws.
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(F) The pledge by a General Partner to the Investor Limited Partner of the General
Partner’s interest in the Owner, as security for the performance of all of the General Partner’s
obligations under the Limited Partnership Agreement.
(G) The sale, transfer or pledge of any limited partnership interest in the Owner or
of any partnership interest in the Investor Limited Partner; provided that such sale, transfer or
pledge shall not be to any Prohibited Person or otherwise result in a violation of Anti-Terrorism
Laws.
(H) Any dilution of the General Partner’s interest in the Owner in accordance
with the Limited Partnership Agreement.
1.10 Very Low Income Household. The term “Very Low Income Household”
shall have the meaning given in California Health and Safety Code section 50105(a).
1.11 Very Low Income Units. The term “Very Low Income Units” shall mean
the two (2) one-bedroom, seven (7) two-bedroom and five (5) three-bedroom rental dwelling
units in the Project restricted to occupancy by Very Low Income Households. The term “Very
Low Income Unit” shall mean each of the Very Low Income Units.
2. TERM OF AGREEMENT; PRIORITY OF AGREEMENT; USE OF
PROPERTY. As required by California Health and Safety Code Section 33334.3, this
Agreement shall commence upon its execution and shall remain in effect for the longest feasible
period but not less than the period terminating fifty-five (55) years following the date on which a
Release of Construction Covenants is recorded for the Project. This Agreement shall remain in
effect throughout its full term, notwithstanding the payment in full of the Residential Loan. This
Agreement is secured by the Residential Deed of Trust and Owner shall not be entitled to a
reconveyance of the Residential Deed of Trust prior to the expiration of the full term of this
Agreement. This Agreement shall unconditionally be and remain at all times prior and superior
to the lien created by the Senior Deed of Trust and any other of the Senior Loan Documents and
all of the terms and conditions contained in the Senior Loan Documents and to the lien of any
new mortgage debt which is for the purpose of refinancing all or any part of the Senior Loan.
Owner hereby agrees that the Restricted Units in the Project are to be owned, managed, and
operated as affordable housing for Eligible Tenants for the term of this Agreement. To that end,
and for the term of this Agreement, the Owner hereby represents, covenants, warrants and agrees
as follows:
2.1 Schedule. The Project activities shall be accomplished within the time
provided in the Schedule of Performance, which is attached to the DDA.
2.2 Tasks and Budget. The Project Costs are indicated in the Project Budget
attached to the DDA. The Set Aside Funds shall be used exclusively for development of the
Project.
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2.3 Construction Covenant. Owner hereby covenants and agrees on behalf of
itself and its successors and assigns in the Property or any portion thereof or any improvements
thereon or any interest therein that Owner and such successors and assigns shall develop the
Project in accordance with the DDA (including but not limited to the Scope of Development), the
Redevelopment Plan for the Culver City Redevelopment Project, this Agreement, and plans
approved by the Agency and the City of Culver City.
2.4 Facilities. All of the Units in the Project shall contain facilities
adequate for living, sleeping, eating, cooking and sanitation in accordance with all applicable
federal, state and local laws and codes. The construction and maintenance of the Units shall
comply with the City’s building code and all other applicable local codes, building standards,
ordinances and zoning ordinances in effect, and the Units shall be decent, safe and sanitary and
shall conform to the building, electrical, plumbing, mechanical and energy codes that have been
adopted by the City of Culver City. To the extent applicable, the Project shall comply with the
accessibility requirements at 24 CFR Part 8, which implements Section 504 of the Rehabilitation
Act of 1973 (29 U.S.C. 794) and, if applicable, the design and construction requirements at 24
CFR 100.205 for covered multifamily dwellings, as defined at 24 CFR 100.201, which
implements the Fair Housing Act (42 U.S.C. 3601-3619).
2.5 Residential Use. None of the residential Units in the Project will at
any time be utilized on a transient basis or will ever be used as a hotel, motel, dormitory,
fraternity house, sorority house, rooming house, nursing home, hospital, sanitarium, or trailer
court or park, or any other use that is inconsistent or incompatible with this Agreement.
2.6 Conversion of Units. No part of the Project will at any time be owned by
a cooperative housing corporation nor shall the Owner take any steps in connection with the
conversion to such ownership or uses to condominiums, or to any other form of ownership.
2.7 Tenant Preference. All of the Restricted Units will be made available to
Eligible Tenants for rental in accordance with the terms of this Agreement, and the Owner shall
not give preference to any particular class or group in renting those Units, except to the extent
that the Restricted Units are required to be leased or rented to Eligible Tenants and except as
provided in Section 3.6 below.
2.8 Tenant Protections. Owner shall comply with the following tenant
protections:
a. The lease of a Restricted Unit must be for not less than one year,
unless by mutual agreement between tenant and Owner and if such shorter term is consistent
with applicable tax credit regulations.
b. The lease of a Restricted Unit may not contain any of the following
provisions:
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(1) Agreement by the tenant to admit guilt or to a judgment in
favor of Owner in a lawsuit brought in connection with the lease;
(2) Agreement by the tenant that the Owner may take, hold, or sell
personal property of household members without notice to the tenant and a court decision on the
rights of the parties. This prohibition, however, does not apply to an agreement by the tenant
concerning disposition of personal property remaining in the Unit after the tenant has moved out
of the Unit. The Owner may dispose of this personal property in accordance with state law.
(3) Agreement by the tenant not to hold the Owner or the Owner’s
agents legally responsible for any action or failure to act, whether intentional or negligent;
(4) Agreement by the tenant that the Owner may institute a lawsuit
without notice to the tenant;
(5) Agreement by the tenant that the Owner may evict the tenant
or household members without instituting a civil court proceeding in which the tenant has the
opportunity to present a defense, or before a court decision on the rights of the parties;
(6) Agreement by the tenant to waive any right to a trial by jury;
(7) Agreement by the tenant to waive the tenant’s right to appeal,
or to otherwise challenge in court, a court decision in connection with the lease; and
(8) Agreement by the tenant to pay attorney’s fees or other legal
costs if the tenant wins in a court proceeding by the Owner against the tenant. The tenant,
however, may be obligated to pay costs if the tenant loses.
Owner shall adhere to a fair lease and grievance procedure approved by the Agency.
2.9 Termination of Tenancy. Owner, its successors or assigns, may not
terminate the tenancy or refuse to renew the lease of a tenant of a Restricted Unit, except (i) for
serious or repeated violation of the terms and conditions of the lease; (ii) for violation of
applicable federal, state, or local law; (iii) violation of occupancy rules as described in Section 3
below; or (iv) for other good cause. Any termination or refusal to renew must be preceded by not
less than 30 days by the Owner’s service upon the tenant of a written notice specifying the
grounds for the action, provided, however, Owner may use a shorter notice period to the extent
allowed by applicable law and if reasonably necessary to protect the health and/or safety of the
Project and/or any Project tenants.
3. OCCUPANCY OF RESTRICTED UNITS BY ELIGIBLE TENANTS. Owner
hereby represents, warrants, and covenants as follows:
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3.1 Income Restrictions. Except as expressly provided herein, throughout the
term of this Agreement, the Restricted Units shall be rented only to, and occupied only by,
Eligible Tenants.
3.2 Rental Rates. Owner shall rent the Restricted Units to Eligible Tenants at
no more than the allowable Affordable Rents for a household size appropriate to the unit, which
is the number of bedrooms plus one. The rental rates for the Restricted Units shall be adjusted
annually based upon annual updates of the applicable income and rent standards, including but
not limited to updates published by the California Housing and Community Development
Department. In no event shall any of the Restricted Units be rented at a rate greater than the
applicable Affordable Rent. Failure to comply with the affordability requirements of this
Agreement is an event of default under the terms of the Residential Loan. Subject to the right to
cure, the Residential Loan of Set Aside Funds will be due and payable immediately if the
Restricted Units do not meet the requirements of this Agreement.
3.3 Occupancy By Eligible Tenant. If at any time a Restricted Unit
tenant’s household income increases, resulting in disqualification of such tenant as a Very Low
Income, Low Income or Moderate Income Household, as applicable, such tenant shall have a
period of ninety (90) days to relocate from the Property. The disqualified tenant shall be fully
responsible for the costs and expenses related to the relocation. Should such tenant face
extraordinary hardship in relocating from the Property, the tenant may submit a written appeal to
the Agency requesting an extension of the time period within which the tenant must relocate. If
the Agency’s Executive Director determines in his or her sole discretion that a hardship
exception is justified by the circumstances, he or she may extend the relocation period for up to a
maximum of ninety (90) additional days.
The provisions set forth in this Section 3.3 shall apply only to the extent such provisions are not
in conflict with any applicable federal or state law, any regulatory agreement affecting the
Project that is recorded in superior priority to this Agreement, or any rule or regulation governing
or related to the nine percent tax credits.
3.4 Maximum Occupancy. The maximum number of persons residing in a
Unit may not exceed the maximum occupancy standards of the City of Culver City. Owner shall
be responsible for enforcing this maximum occupancy limit. Upon discovery of a violation of
this Section 3.4, Owner shall immediately notify the tenant of record in writing (“Occupancy
Violation Notice”). In the Occupancy Violation Notice, Owner shall inform the tenant of the
occupancy violation and provide the tenant with an opportunity to cure the violation within thirty
(30) days from the date of the Notice.
3.5 Income Computation. Prior to a prospective tenant’s occupancy of a
Restricted Unit, Owner shall obtain and maintain on file an income computation and certification
form from such prospective tenant dated immediately prior to the date of initial occupancy of a
Restricted Unit by such prospective tenant. Owner shall verify that the income information
provided by an applicant is accurate by following all applicable Agency policies and procedures
and by taking one or more of the following steps as a part of the verification process: (i) obtain
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two (2) pay stubs from the most recent pay periods; (ii) obtain a written verification of income
and employment from applicant’s current employer; (iii) obtain an income verification form
from the Social Security Administration and/or California Department of Social Services if the
applicant receives assistance from either agency; (iv) if an applicant is unemployed or did not
file a tax return for the previous calendar year, obtain other verification of such applicant’s
income as is reasonably satisfactory; or (v) obtain such other information as may be reasonably
required. Owner shall update the foregoing records annually and shall provide copies of updated
tenant eligibility records and monthly rental records relating to the Restricted Units to the
Agency for review. Health and Safety Code Section 33418(b) requires the Agency to adequately
fund its compliance monitoring activities and authorizes the Agency to impose fees upon the
owners of properties monitored pursuant to Section 33418 to defray the cost of complying with
the Agency’s monitoring and reporting obligations. Therefore, Owner agrees that, commencing
upon the Completion of the Project and continuing throughout the term of this Agreement,
Owner will pay to the Agency an annual monitoring fee in the amount set forth in the definition
of “Annual Operating Expenses” in the Agency Note. Upon review of records submitted to it,
the Agency may at its option perform an independent audit of the tenant eligibility records in
order to verify compliance with the income and affordability requirements set forth herein.
Costs for such an audit performed by the Agency shall be an expense of the Agency. Owner
shall retain the records described in this Section for a period of five (5) years after the date the
respective records were created.
3.6 Rental Priority. Subject to Owner’s policies and procedures for screening
potential tenants, which must be approved by the Agency, the Restricted Units shall be rented
according to the following priorities, as such units become available for occupancy:
a. Owner shall give first priority in renting the Restricted Units to
Eligible Tenants who have been displaced by activities of the City or the Agency, pursuant to
California Health & Safety Code Section 33411.3.
b. Owner shall, to the extent permitted by applicable law, give second
priority in renting the Restricted Units to Eligible Tenants who are employees of the City of
Culver City and the Culver City School District.
c. Owner shall, to the extent permitted by applicable law, give third
priority in renting the Restricted Units to Eligible Tenants who are employed on a permanent,
full-time basis in Culver City.
d. Owner shall give fourth priority in renting the Restricted Units to
Eligible Tenants who are listed on the Agency’s Rental Assistance Program (RAP) Waiting List
or the Culver City Housing Agency’s Section 8 waiting list.
Except as otherwise set forth above, Restricted Units shall be rented to Eligible Tenants on a
first-come, first-served basis; provided, however, that Owner shall maintain an “interest list” or
“eligibility list” of potential tenants. Notwithstanding the foregoing, Owner may conduct a
weighted lottery during the initial lease-up of the Restricted Units, using a methodology
approved by the Agency to effectuate the preferences listed in clauses a. through d. of this
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Section 3.6. The rental priority provision set forth in this Section 3.6 shall apply only to the
extent such provisions are not in conflict with any applicable federal or state law (including,
without limitation, Fair Housing laws and regulations), any regulatory agreement affecting the
Project that is recorded in superior priority to this Agreement or any rule or regulation governing
or related to the nine percent tax credits.
3.7 Maintenance of Records. Owner shall maintain complete and accurate
records pertaining to the Restricted Units, and shall permit any duly authorized representative of
the Agency to inspect the books and records of Owner pertaining to the Project including, but not
limited to, those records pertaining to tenant eligibility and occupancy of the Restricted Units.
Records pertaining to the Project and the Restricted Units shall be retained for a period of five
(5) years after the termination of this Agreement.
To assist the Agency in meeting its reporting requirements under California’s
Community Redevelopment Law, Owner shall prepare, maintain and submit to the Agency the
following records and reports:
a. Records which demonstrate that the Property meets the affordability and income
targeting requirements of California Health and Safety Code Sections 50079.5, 50093 and 50053
for the duration of this Agreement. Records shall be kept for each family occupying a Restricted
Unit;
b. Records which demonstrate that each lease complies with the tenant and
participant protections, as specified in Section 2.8 of this Agreement. Records shall be kept for
each family occupying a Restricted Unit;
c. Equal opportunity and fair housing records;
e. Documentation of the Owner’s affirmative steps to assure that minority business
and women’s business enterprises have an equal opportunity to obtain or compete for contracts
and subcontracts as sources of supplies, equipment, construction and services; and
f. Documentation of the actions the Owner has taken to affirmatively further fair
housing.
Owner shall retain all books and records relevant to the DDA for a minimum of five years after
the project completion date, except that records of individual tenant income verifications, project
rents and project inspections shall be retained for the most recent five year period until five years
after the affordability period terminates, or until the conclusion or resolution of any and all audits
or litigation relevant to the DDA, whichever is later. The Agency and its representatives shall
have the right of access to any pertinent books, documents, papers or other records of the Owner,
in order to make audits, examinations, excerpts and transcripts.
3.8 Reliance on Tenant Representations: Each tenant lease shall contain a
provision to the effect that Owner has relied on the income certification and supporting
information supplied by the tenant in determining qualification for occupancy of a Restricted
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Unit, and that any material misstatement in such certification (whether or not intentional) will be
cause for immediate termination of such lease.
4. MAINTENANCE
4.1 Maintenance Covenant.
(a) Owner agrees to maintain all interior and exterior improvements,
including landscaping, on the Property in good condition and repair (and, as to landscaping, in a
healthy condition), reasonable wear and tear excepted, and in accordance with all applicable
laws, rules, ordinances, orders, and regulations of all federal, state, county, municipal, and other
governmental agencies and bodies having or claiming jurisdiction. In addition, Owner shall keep
the Property free from all graffiti and any accumulation of debris or waste material. Owner shall
make all repairs and replacements necessary to keep the improvements in good condition and
repair, including regularly scheduled treatments to maintain the aesthetic appearance of exterior
building materials, and shall promptly eliminate all graffiti and replace dead and diseased plants
and landscaping with comparable materials. Maintenance shall be performed in a manner that
will preserve the Project’s LEED Silver standards. The maintenance covenant contained in this
Section shall remain in effect for the term of this Agreement.
(b) The Project shall comply with the lead-based paint standards in 24
C.F.R. §92.355.
4.2 Agency Rights. The Agency shall have the right to enter upon the
Property to inspect the Property and both the interiors and exteriors of the Units, upon forty-eight
(48) hours notice to Owner, except in the event of an emergency. The Agency may, but is not
obligated to, perform or cause to be performed the maintenance necessary to cure any default of
these maintenance covenants and Owner shall be liable for payment of reasonable costs to
perform such required maintenance; provided, however, that Owner first be given written notice
of the actions required to cure any default, and Owner, after receipt of such notice, shall have
thirty (30) days to cure such defaults, but Owner shall not be deemed in default of the foregoing
maintenance covenant if such default cannot reasonably be cured within the thirty (30) day
period referenced above so long as Owner has commenced to cure such default within the same
thirty (30) day period and is diligently proceeding with the work to cure such default.
Notwithstanding the foregoing, if any property conditions are reasonably identified by the
Agency that pose an immediate danger to life or limb, Owner shall have three (3) business days
to effect corrections of such condition(s) to the Agency’s reasonable satisfaction.
4.3 Annual & Bi-Annual Reports. Owner covenants and agrees to submit to
the Agency an annual report (the “Annual Report”), which shall include the information required
by Section 3.5 of this Agreement and by California Health & Safety Code Section 33418. The
Annual Report shall include for each Restricted Unit the rental rate and the income and family
size of the occupants, and shall also include the records described in Section 3.5 herein and the
financial statements required by Section 402 of the DDA. The income information shall be
supplied by the tenant in a certified statement on a form provided by the Agency. The Owner
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shall submit the Annual Report on or before April 30 of the year following the year covered by
the Annual Report. The Owner shall provide for the submission of household information and
certification in its leases with tenants.
Beginning on the date of first occupancy, and for each fiscal year thereafter during the term of
this Agreement, Owner shall also submit on a quarterly basis a report for the management of the
Property (the “Quarterly Report”). The Quarterly Report shall include a profit and loss
statement, budget to date figures, and occupancy report and shall clearly show project revenues,
operating expenses, and deposits to and withdrawals from the Project’s Capital Reserve Account.
The Quarterly Report shall be in a form that is reasonably acceptable to the Agency Executive
Director. The Agency Executive Director, in his/her sole discretion may waive the requirement
of the Quarterly Report for one or more reporting periods. However, such waiver shall not
operate to waive any subsequent requirement of the Quarterly Report for the Restricted Period.
After receipt of such Quarterly Report for the Project, the Agency may request additional
financial analyses or obtain a third party review at the Agency’s own expense, of financial
statements for the Project to verify the accuracy of the payments by Owner on the Agency Note
or the required deposits into the Capital Reserve Account. If the Agency’s review of Owner’s
Quarterly Report reveals material errors in the calculation of the payments by Owner on the
Agency Note or reveals that the required deposits into the Capital Reserve Account have not
been made, then Owner shall reimburse the Agency for its cost of conducting the financial
analyses or obtaining a third party review.
4.4 Management Plan. Within the time set forth in the Schedule of
Performance attached to the DDA, Owner shall prepare and submit to the Agency for approval a
management plan in accordance with the following (“Management Plan”):
(a) The Management Plan, including such amendments as may be
approved in writing by the Agency, shall remain in effect for the term of this Agreement. Owner
shall not amend the Management Plan or any of its components without the prior written consent
of the Agency. The components of the Management Plan shall include:
(1) Management Agent. The name and qualifications of the
proposed management agent for the Project (the “Management Agent”), which may include but
shall not be limited to FPI Management, Inc. The Agency shall approve or disapprove the
proposed Management Agent, if other than FPI Management, in writing based on the experience
and qualifications of the Management Agent.
(2) Management Program. A description of the proposed
management, maintenance, tenant selection and occupancy policies and procedures for the
Restricted Units, which shall include procedures to assure that advertising of the Restricted Units
will reach a broad cross-section of Culver City residents.
(3) Management Agreement. A copy of the proposed
management agreement specifying the amount of the management fee and the relationship and
division of responsibilities between Owner and management agent.
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(4) Tenant Lease or Rental Agreement. A copy of the proposed
tenant lease or rental agreement to be used in renting the Restricted Units.
(5) Annual Operating Budget. Within the time set forth in
the Schedule of Performance attached to the DDA and annually thereafter not later than fifteen
(15) days prior to the beginning of the next fiscal or calendar year of the Project, Owner shall
submit a projected operating budget to the Agency for review and approval. After Owner’s
initial projected operating budget submittal, Owner shall annually reconcile each previous year’s
projected budget with actual operating results for the Project (“Budget Reconciliation”). In each
Budget Reconciliation, Owner shall set forth an explanation for any major discrepancies between
projected and actual budgets. For purposes of this Agreement, a “major discrepancy” shall mean
a line item difference between projected and actual budgets of 20% or more.
(6) Social Services Program. A description of the proposed
social services to be provided to the tenants, including the proposed scheduling of any classes or
programs that will be offered on a regular basis, a description of any selection criteria for
determining who will be eligible to receive the services, and a description of the proposed
staffing level and qualifications of the providers of the services.
The Agency shall not unreasonably withhold, condition or delay its approval of any matter for
which its approval is required hereunder, but such matter shall be deemed disapproved unless the
Agency provides to Owner its written approval within thirty (30) days after receipt of a request
for approval. Any express disapproval shall be in writing and contain the Agency’s reasons for
disapproval. Notwithstanding the foregoing, if the Agency has not expressly approved or
disapproved Owner’s projected operating budget within thirty (30) days after its submittal to the
Agency, then Owner shall provide a written notice to the Agency that it intends to operate
pursuant to the projected operating budget and Agency shall have an additional thirty (30) days
within which to approve or disapprove such budget. If the Agency has not expressly approved or
disapproved the projected operating budget by the end of the second 30-day period, then Owner
may operate the Project under its projected operating budget so long as discretionary amounts do
not exceed one hundred ten percent (110%) of amount of that line item in the previous year’s
approved operating budget.
(b) Owner’s agreement with the Management Agent shall provide that
it is subject to termination by Owner without penalty, upon thirty (30) days prior written notice.
Owner hereby covenants and agrees that, if the Agency determines in its reasonable judgment
that the Project is not being operated and managed in accordance with the Management Plan, the
Agency may deliver notice to the Owner of the Agency’s determination that the Project’s
management practices do not conform to the Management Plan (the “Agency Notice”), including
a reasonably detailed explanation of such non-conformance. The Agency and Owner shall meet
and confer in good faith to identify actions to be taken by Owner to bring its management
practices into conformance with the Management Plan, which could include replacing the
Management Agent. Owner shall have thirty (30) days after receipt of the Agency Notice (or
such longer time as may be granted by the Agency) to either change its management practices to
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conform to the Management Plan or replace the Management Agent with a Management Agent
approved by the Agency. The Owner shall promptly notify the Agency upon learning that there
is a change in the management or control of the Management Agent, and, if the change is
unsatisfactory to the Agency, the Agency shall be entitled to require the Owner to replace the
Management Agent in accordance with the terms of this paragraph.
5. DEFAULT; ENFORCEMENT If the Owner defaults in the performance or
observance of any covenant, agreement or obligation of the Owner set forth in this Agreement,
and if such default remains uncured for a period of 30 days after notice thereof shall have been
given by the Agency to the Owner, then the Agency shall declare an “Event of Default” to have
occurred hereunder; provided, however, that if the default is of such a nature that it cannot be
corrected within 30 days, such default shall not constitute an Event of Default hereunder so long
as the Owner institutes corrective action within said 30 days and diligently pursues such action
until the default is corrected.
Following the declaration of an Event of Default hereunder, the Agency may take any one or
more of the following steps, in addition to all other remedies provided by law or equity:
(i) by mandamus or other suit, action or proceeding at law or in equity,
including injunctive relief, require the Owner to perform its obligations and covenants
hereunder or enjoin any acts or things that may be unlawful or in violation of the rights of
the Issuer or the Trustee hereunder;
(ii) have access to and inspect, examine and make copies of all of the books
and records of the Owner pertaining to the Project; and
(iii) take such other action at law or in equity as may appear necessary or
desirable to enforce the obligations, covenants and agreements of the Owner hereunder,
including acceleration of the Agency Note and exercise of the Agency’s power of sale
under the Agency Deed of Trust.
The Owner hereby agrees that specific enforcement of the Owner’s agreements contained herein
is the only means by which the Agency may fully obtain the benefits of this Agreement made by
the Owner herein, and the Owner therefore agrees to the imposition of the remedy of specific
performance against it in the case of any Event of Default by the Owner hereunder. Provided
however, the rights and remedies of the Agency are cumulative, and the exercise by the Agency
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
Owner.
6. NONDISCRIMINATION. There shall be no discrimination against or
segregation of any person, or group of persons, on account of race, color, creed, age, class,
income (other than as required by applicable regulatory agreements), religion, sex, sexual
orientation, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use,
occupancy, tenure or enjoyment of the Property, or any part thereof, or in the awarding of
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contracts for the Project, nor shall participant, 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 of the Property, or any part thereof, or in the awarding of contracts for the Project
(except as permitted by this Agreement). Owner shall comply with all applicable federal, state
and local nondiscrimination, fair housing, and equal opportunity requirements.
6.1 Form of Nondiscrimination and Nonsegregation Clauses. The Owner
shall refrain from restricting the rental, sale or lease of the property on the basis of race, color,
creed, age, class, income (other than as required by applicable regulatory agreements), religion,
sex, sexual orientation, 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 any basis listed in subdivision (a) or (d) of Section 12955 of the
Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and
paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code,
in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the premises herein
conveyed, nor shall the grantee or any person claiming under or through him or her, establish or
permit any 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
premises 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:
That there shall be no discrimination against or segregation of any person or group of persons, on
account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as
those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of
subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the 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 any basis listed in subdivision (a) or
(d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926,
12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section
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12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure, or
enjoyment of the land, nor shall the transferee itself 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 of the land.”
7. COVENANTS TO RUN WITH THE LAND. Owner hereby subjects the
Property to the covenants, reservations, and restrictions set forth in this Agreement. Agency and
Owner hereby declare their express intent that all such covenants, reservations, and restrictions
shall be deemed covenants running with the land and shall pass to and be binding upon the
Owner’s successors in title to the Property; provided, however, that on the termination of this
Agreement said covenants, reservations and restrictions shall expire, except the
nondiscrimination covenants contained in Section 6 and Section 6.1 shall remain in perpetuity.
All covenants without regard to technical classification or designation shall be binding for the
benefit of the City of Culver City and the Agency, and such covenants shall run in favor of the
City and Agency for the entire term of this Agreement, without regard to whether the City or
Agency is or remains an owner of any land or interest therein to which such covenants relate.
8. ATTORNEYS’ FEES. In the event that any action, suit or other proceeding
is brought to enforce the obligations of under this Agreement, each party shall bear its own costs
and expenses of suit, including attorneys’ fees, expert witness fees and all costs incurred in each
and every such action, suit or other proceeding, including any and all appeals or petitions
therefrom.
9. AMENDMENTS. This Agreement shall be amended only by a written
instrument executed by the parties hereto or their successors in title, and duly recorded in the
Official Records of the County of Los Angeles, State of California.
10. NOTICE. Any notice required to be given hereunder shall be made in writing
and shall be given by (i) personal delivery, (ii) courier service that provides a receipt showing
date and time of delivery, or (iii) certified or registered mail, postage prepaid, return receipt
requested, at the addresses specified below, or at such other addresses as may be specified in
writing by the parties hereto:
Agency: Culver City Redevelopment Agency
9770 Culver Boulevard
Culver City, CA 90230-0507
Attn: Agency Executive Director
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With a copy to: Sol Blumenfeld
Director of Community Development
Culver City Redevelopment Agency
9770 Culver Boulevard
Culver City, CA 90230-0507
And a copy to: City Attorney’s Office
City of Culver City
9770 Culver Boulevard
Culver City, CA 90230-0507
Owner: Tilden Terrace, L.P.
c/o Los Angeles Housing Partnership, Inc.
1200 Wilshire Boulevard, Suite 307
Los Angeles, CA 90017
Attn: Mary Silverstein, President and Executive Director
With a copy to: Bocarsly Emden Cowan Esmail & Arndt LLP
633 West 5
th
Street, 70
th
Floor
Los Angeles, CA 90071
Attn: Kyle Arndt, Esq.
With a copy to: Hudson Housing Capital, LLC
630 Fifth Avenue, 28
th
Floor
New York, NY 10111
Attn: Joseph A. Macari
Notices personally delivered or delivered by courier shall be effective upon receipt. Mailed
notices shall be effective on the earlier of receipt or Noon on the second business day following
deposit in the United States mail.
11. SEVERABILITY/WAIVER/INTEGRATION.
11.1 Severability. If any provision of this Agreement shall be invalid, illegal
or unenforceable, the validity, legality and enforceability of the remaining portions hereof shall
not in any way be affected or impaired thereby.
11.2 Waiver. A waiver by either party of the performance of any
covenant or condition herein shall not invalidate this Agreement nor shall it be considered a
waiver of any other covenants or conditions, nor shall the delay or forbearance by either party in
exercising any remedy or right be considered a waiver of, or an estoppel against, the later
exercise of such remedy or right.
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11.3 Integration. This Agreement contains the entire Agreement between the
parties and neither party relies on any warranty or representation not contained in this
Agreement.
12. GOVERNING LAW. This Agreement shall be governed by the internal laws of
the State of California without regard to the principles of conflicts of laws.
13. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall constitute one original and all of which shall be one and the
same instrument. This Agreement may be executed by each party on a separate signature page,
and when the executed signature pages are combined, shall constitute one single instrument.
14. TRANSFER OF THE PROJECT.
14.1. The qualifications and identity of Owner are of particular concern to the
Agency. It is because of those qualifications and identity that the Agency has entered into the
DDA with Owner. No voluntary or involuntary successor in interest of Owner shall acquire any
rights or powers with respect to the Project except as expressly set forth herein.
14.2. Except for a Permitted Transfer, Owner agrees that Owner shall not sell
the Project during the term of this Agreement, unless and until Owner has given to the Agency
notice in writing of its intent to sell, specifying the identity of the prospective buyer and the price
and terms of the contemplated sale. Within ninety (90) days after Owner gives the Agency
written notice of Owner’s intent to sell, the Agency shall have the right to purchase the Project at
the same price and on the same terms and conditions set forth in Owner’s written notice of intent
to sell. To exercise this right, The Agency must, within the same ninety (90) day period, deposit
in escrow with any escrow company in Los Angeles County, California, all moneys and
instruments required by the terms of the Owner’s notice of intent to sell to be paid or delivered to
Owner on close of escrow and shall also give Owner written notice of the deposit. If the Agency
does not exercise the right in accordance with the provisions of this Section, Owner may sell the
Project to the prospective buyer for the price and on the terms contained in the notice; provided,
however, that Owner has made every reasonable effort to sell the Project to another nonprofit
housing corporation with Owner’s similar experience and reputation in the field of low-income
housing (including the management of properties with income and affordability restrictions), and
provided further that the Agency has reasonably approved such prospective buyer in advance in
writing.
14.3. If at any time during the term of this Agreement, Owner receives from any
third party a bona fide offer to purchase the Project on terms acceptable to Owner and Owner
desires to sell the Site pursuant to said offer or a counter-offer from Owner, then Owner shall
give written notice of the offer to the Agency. Within ninety (90) days after Owner gives the
Agency written notice of the third-party offer, the Agency shall have the right to purchase the
Project at the same price and on the same terms and conditions set forth in the third-party offer.
To exercise its right, the Agency must, within the same ninety (90) day period, deposit in escrow
with any escrow company in Los Angeles County, California, all moneys and instruments
required by the terms of the offer to be paid or delivered to Owner on close of escrow and shall
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also give Owner written notice of the deposit. If the Agency does not exercise its right to
purchase in accordance with the provisions of this Section, Owner may sell the Project to the
third party making the offer on the same terms and conditions set forth in that offer; provided,
however, that Owner has made every reasonable effort to sell the Project to another nonprofit
housing corporation with Owner’s similar experience and reputation in the field of low-income
housing (including the management of properties with income and affordability restrictions), and
provided further that the Agency has reasonably approved such prospective buyer in advance in
writing. If for any reason the Project is not sold to the party making the offer, Owner shall give
the Agency the same right to purchase the Project on receiving any subsequent offer from any
third party that is acceptable to Owner.
14.4. For the reasons cited above, the Owner represents and agrees for itself and
any successor in interest that, except for changes necessitated by a Permitted Transfer, without
the prior written approval of the Agency (not to be unreasonably withheld, conditioned or
delayed), there shall be no significant change in the ownership of the Owner or in the relative
proportions thereof, or with respect to the identity of the parties in control of the Owner or the
degree thereof, by any method or means.
14.5. The Owner shall promptly notify the Agency of any and all changes
whatsoever in the identity of the parties in ownership and/or in control of the Owner or the
degree thereof, of which it or any of its officers have been notified or otherwise have knowledge
or information. The Agency may exercise any and all available remedies if there is any
significant change (voluntary or involuntary) in membership, ownership, management or control,
of the Owner or any general partner of the Owner (other than such changes occasioned by the
death or incapacity of any individual, or necessitated by a Permitted Transfer) without the prior
written consent of the Agency, except that periodic, routine changes in board membership that
cumulatively affect less than 50% of the membership of the board shall not be considered a
“significant change”.
14.6. Except with respect to a Permitted Transfer, Owner shall not assign or
attempt to assign the DDA or any right therein, nor make any Transfer, without prior written
approval of the Agency Executive Director, except as expressly permitted by this Agreement.
Any proposed transferee shall have the qualifications and financial responsibility necessary and
adequate as may be reasonably determined by the Agency to fulfill the obligations undertaken in
this Agreement by the Owner. Any such proposed transferee, by instrument in writing
satisfactory to the Agency and in form recordable among the land records, for itself and its
successors and assigns, and for the benefit of the Agency shall expressly assume all of the
obligations of the Owner under the DDA and agree to be subject to all conditions and restrictions
applicable to the Owner in the DDA. There shall be submitted to the Agency for review all
instruments and other legal documents proposed to affect any such Transfer, and if approved by
the Agency, its approval shall be indicated to the Owner in writing.
14.7. In the absence of specific written agreement by the Agency, no Transfer,
or approval thereof by the Agency, shall be deemed to relieve the Owner or any other party from
any obligations under the DDA or this Agreement.
14.8. Consent to any Transfer shall not be deemed to be a waiver of the right to
require consent to future or successive Transfers.
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15. LIMITATION ON LIABILITY. Each obligation of the Owner under this
Agreement is a nonrecourse obligation of the Owner and Owner’s partners. Except as provided
otherwise in this Agreement, neither the Owner nor any of its general or limited partners, nor any
other party, shall have any personal liability for payment of obligations to the Agency. The sole
recourse of the Agency shall be the exercise of its rights against the Property and the Project and
any related security for the Residential Loan.
Notwithstanding the foregoing, the Agency may obtain a judgment or order (including, without
limitation, an injunction) requiring Owner or any other party to perform (or refrain from)
specified acts; may proceed against any person or entity whatsoever with respect to the
enforcement of any guarantees, surety bonds, letters of credit, reimbursement agreements or
similar rights to payment or performance; and may recover directly from Owner or any other
party:
14.9. Notwithstanding the foregoing, Agency may obtain a judgment or order
(including, without limitation, an injunction) requiring Developer or any other party to perform
(or refrain from) specified acts other than repayment of the Residential Loan; may proceed
against any person or entity whatsoever with respect to the enforcement of any performance or
completion guarantees or similar rights to performance; and may recover directly from
Developer or any other party:
(a) any damages, costs and expenses incurred by Agency as a result of fraud
or any criminal act or acts of Owner or any partner, shareholder, officer, director or employee
(acting within the scope of his or her employment) of Owner or of any of Owner’s general
partners;
(b) any damages, costs and expenses incurred by Agency as a result of any
misappropriation of funds provided for the development of the Project, as described in the DDA,
rents and revenues from the operation of the Project, or proceeds of insurance policies or
condemnation proceeds;
(c) any and all amounts owing by Owner pursuant to Owner’s indemnification
regarding Hazardous Substances; and
(d) all court costs and attorneys’ fees reasonably incurred in enforcing or
collecting upon any of the foregoing exceptions.
[Remainder of Page Intentionally Left Blank; Signature Pages Follow]
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IN WITNESS WHEREOF, the Agency and Owner have executed this Agreement Containing
Covenants by duly authorized representatives on the date first written hereinabove.
“OWNER”
TILDEN TERRACE, L.P.,
a California limited partnership
By: Los Angeles Housing Partnership, Inc.,
a California nonprofit public benefit
corporation
Its: Managing General Partner
By: _________________________
Mary Silverstein
Its: President and Executive Director
“AGENCY”
CULVER CITY REDEVELOPMENT
AGENCY, a public body corporate and politic
By: _________________________________
John M. Nachbar
Executive Director
ATTEST:
By: _________________________________
Agency Secretary
APPROVED AS TO FORM:
By: _________________________________
General Counsel
By: _________________________________
KANE, BALLMER & BERKMAN
Agency Special Counsel
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EXHIBIT NO. 1
LEGAL DESCRIPTION OF PROPERTY
The land referred to herein is situated in the State of California, County of Los Angeles, and
described as follows:
LOTS 1 AND 2 OF TRACT NO. 9648, IN THE CITY OF CULVER CITY COUNTY OF LOS
ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 142, PAGES
13, 14 AND 15 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID
COUNTY
And
LOT 3 OF TRACT 9648, AS SHOWN ON A MAP RECORDED IN BOOK 142, PAGES 13,
INCLUSIVE OF MISCELLANEOUS MAPS, RECORDS OF LOS ANGELES COUNTY,
CALIFORNIA
And
LOTS 4, 5, 6, 7 AND 8 OF TRACT NO. 9648, IN THE CITY OF CULVER CITY, COUNTY
OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 142,
PAGES(S) 13 TO 15 INCLUSIVE OF MAPS, IN THE OFFICE OF THE COUNTY
RECORDER OF SAID COUNTY.
APN: 4213-007-001, 4213-007-901, 4213-007-900
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State of California )
County of Los Angeles )
On ________________________________________ before me, __________________,
a Notary Public, personally appeared ______________________________, who proved to me
on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature_______________________________________ (Seal)
State of California )
County of Los Angeles )
On ________________________________________ before me, __________________,
a Notary Public, personally appeared ______________________________, who proved to me
on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature_______________________________________ (Seal)
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EXHIBIT NO. 11
FORM OF COMMERCIAL NOTE
RESIDUAL RECEIPTS PROMISSORY NOTE
SECURED BY DEED OF TRUST
TO THE CULVER CITY REDEVELOPMENT AGENCY
(TAX INCREMENT FUNDS)
3% Interest Culver City, California
$3,395,000 ______________, 2011
FOR VALUE RECEIVED, TILDEN TERRACE, L.P., a California limited Partnership
(“Borrower”), hereby promises to pay to the CULVER CITY REDEVELOPMENT AGENCY, a
public body, corporate and politic, (“Agency”) or order, a principal amount of Three Million
Three Hundred Ninety-Five Dollars ($3,395,000), or so much thereof as may be advanced by the
Agency to the Borrower as the Commercial Loan pursuant to the Disposition and Development
Agreement dated as of March 21, 2011 (the “DDA”) between Borrower (“Developer” therein)
and the Agency, incorporated herein by this reference. The DDA is a public record on file in the
offices of the Agency. The Borrower shall pay interest at the rate, in the amount and at the time
hereinafter provided.
1. Definitions. Any capitalized term not otherwise defined herein shall have the
meaning ascribed to such term in the DDA. In addition, the following terms shall have the
following meanings:
The term “Net Proceeds” shall mean the proceeds of a sale, transfer or refinancing after
repayment of existing indebtedness, less the reasonable and customary costs of the transaction.
The term “Residential Loan” shall mean the Agency’s loan to Borrower in the face
amount of ELEVEN MILLION EIGHT HUNDRED FIVE THOUSAND DOLLARS
($11,805,000.00), as evidenced by the Residential Note and secured by the Residential Deed of
Trust.
The term “Residual Commercial Receipts” shall mean, in each calendar year, the
amount by which Gross Commercial Revenue (as defined below) exceeds Annual Commercial
Operating Expenses (as defined below), as determined by a certified statement to be completed
not later than one hundred twenty (120) days after the end of each calendar year by Borrower
using generally accepted accounting principles and based on the accrual method (the “Audit”).
(i) “Gross Commercial Revenue,” with respect to each calendar year, shall
mean all revenue, income, receipts, and other consideration actually received from operation or
leasing of the Commercial Space. “Gross Commercial Revenue” shall include, but not be limited
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to: rental income, rental or business interruption insurance collected in lieu of rental income,
expense pass-through items such as real property taxes and insurance, rentals or fees paid for
parking, and common area maintenance charges, excluding, however: (i) security deposits, until
such deposits are applied as rental income upon termination of a lease; (ii) rents paid in advance
of the date such rents are due, until the date on which such payments are due as rent; and (iii)
monies collected for capital items which are paid for by tenants
(ii) “Annual Commercial Operating Expenses,” with respect to each
calendar year shall mean actual and reasonable costs, fees and expenses directly incurred by
Borrower attributable to the operation, maintenance, and management of the Commercial Space,
including painting, cleaning, maintenance costs, non-capital repairs and alterations expenses,
landscaping, utilities, rubbish removal, sewer charges, real and personal property taxes and
assessments, insurance, securities, advertising, promotion and publicity, office, janitorial,
cleaning and building supplies, and a management fee not to exceed five percent (5%) of Gross
Commercial Revenue; provided, however, that all payments to parties related to or affiliated with
Borrower for Commercial Operating Expenses shall not exceed market rates. Annual
Commercial Operating Expenses shall also include approved contributions to a reserve account
for capital expenditures and/or operating deficits, and tenant improvement costs and leasing
commissions that are incurred in leasing or re-leasing space. Annual Commercial Operating
Expenses shall not include principal and interest on debt obligations (other than debt obligations
incurred in connection with the construction of tenant improvements and/or build-outs and
approved by the Agency Executive Director or designee) and non-cash expenses, including
without limitation, depreciation. Annual Commercial Operating Expenses shall be subject to the
reasonable approval of the Agency. .
The term “Senior Loan” shall mean, individually and collectively, the Construction Loan
and the Permanent Loan, or any other loan secured by a deed of trust or other instrument to
which the Agency agrees to subordinate this Note, the Commercial Deed of Trust and the other
Commercial Loan Documents.
2. This Note evidences the obligation of the Borrower to the Agency for the
repayment of the Commercial Loan. Borrower may prepay the principal balance of this Note at
any time without penalty. However, even if Borrower prepays the entire balance of this Note
including all accrued interest, costs and penalties, the covenants, conditions and restrictions imposed
on the Property by the Agreement Containing Covenants shall remain in full force and effect for the
full term as specified therein.
3. This Note is payable at the principal office of Agency, 9770 Culver Boulevard,
Culver City, California 90230-0507, or at such other place as the holder hereof may inform the
Borrower in writing, in lawful money of the United States.
4. This Note is secured by the Commercial Deed of Trust.
5. This Note shall accrue simple interest at the rate of three percent (3%) per annum
on a “draw down” basis on the principal amount disbursed by the Agency, from the date of
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disbursement. However, if any event occurs giving the Agency the right to accelerate repayment of
this Note, the entire unpaid principal balance owing hereunder shall, as of the date of such default,
commence to accrue interest at a rate equal to maximum interest rate permitted by law (the “Default
Rate”). Further, in the event Borrower fails to reimburse the Agency for any amount advanced by
or for the account of the Agency which is due hereunder or under the Commercial Deed of Trust
within ten (10) days after written notice of such advance is made by the Agency to Borrower,
then such unreimbursed amount shall thereafter bear interest at the Default Rate until paid
6. The unpaid principal balance of this Note and all accrued but unpaid interest shall
be due and payable on the earliest to occur of the following (which shall be referred to herein as
the “Maturity Date”):
(a) June 30, 20__;
(b) the fifty-fifth (55
th
) anniversary of the Conversion Date, evidenced by the
recording against the Property of a reconveyance of the Construction Loan Deed of Trust upon
repayment in full of the Construction Loan;
(c) the date the Property or the improvements thereon or any portion thereof
or interest therein is sold, transferred, assigned or refinanced, without the prior written approval
of the Agency, except as permitted by the provisions of Section 206 (“Prohibition Against
Transfers”) of the DDA; or
(d) the date on which there is a Default by the Borrower under the terms of
this Note, the DDA, the Commercial Deed of Trust, the Agreement Containing Covenants, or
any deed of trust or other instrument securing the Senior Loan, which is not cured or waived
within the respective time period provided herein and therein.
7. Prior to the Maturity Date, Borrower shall be obligated to repay the Commercial
Loan as follows:
(a) Borrower shall be obligated to repay the principal amount of this
Commercial Note and the accrued interest thereon, without set off or deduction, by paying to the
Agency, on each June 1 in “Residual Commercial Receipts,” to the extent Residual Commercial
Receipts are available, for the calendar year, or portion thereof, ending on the immediately
preceding December 31 (as the term “Residual Commercial Receipts ” are defined in Section 1
of this Commercial Note), fifty percent (50%) of that year’s Residual Commercial Receipts. The
first such repayment under this Section 7 shall be due on the first June 1 which is one full
calendar year following the Conversion Date (as defined in the DDA), and the last payment shall
be due on June 1 fifty-five (55) years later. Notwithstanding the foregoing, this Commercial
Note shall be fully due and payable on the Maturity Date.
(b) All payments to the Agency on the Commercial Loan shall
be applied first to the payment of all expenses, charges, costs and fees incurred by or payable to
Agency by Borrower pursuant to the terms of the Commercial Loan Documents (in such order
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and manner as Agency, in its sole discretion, may elect), then to the payment of all interest
accrued to the date of such payment, and then to reduce the principal amount owed. All
prepayment of principal on this Note shall be applied to the most remote principal installment or
installments until paid. Notwithstanding anything to the contrary contained herein, after the
occurrence and during the continuation of a default under the Commercial Deed of Trust, all
amounts received by the Agency from any party shall be applied in such order as the Agency, in
its sole discretion, may elect.
8. Any breach by Borrower of the provisions of Section 206 (“Prohibition Against
Transfers”) of the DDA shall constitute a default under this Note. The cure periods under the
DDA and this Note in connection with such a default shall run concurrently.
9. Borrower waives presentment for payment, demand, protest, and notices of
dishonor and of protest; the benefits of all waivable exemptions; and all defenses and pleas on
the ground of any extension or extensions of the time of payment or of any due date under this
Note, in whole or in part, whether before or after maturity and with or without notice. Borrower
hereby agrees to pay all costs and expenses, including reasonable attorney’s fees, which may be
incurred by the holder hereof, in the enforcement of this Note, the Commercial Deed of Trust or
any term or provision of either.
10. Upon the failure of Borrower to perform or observe any term or provision of this
Note, or upon the occurrence of any event of default under the terms of the DDA, the
Commercial Deed of Trust, the Environmental Indemnity, or the Agreement Containing
Covenants, the holder may exercise its rights or remedies hereunder or thereunder. All such
rights and remedies shall be cumulative. Upon the event of a default that is not cured or waived
within the time provided therefore, the whole of the unpaid principal and interest owing on this
Note shall, at the option of Agency and without notice, become immediately due and payable.
This right of the Agency to declare amount owing on this Note immediately due and payable
may be exercised at any time after any such event and the acceptance of one or more payments
from any person thereafter shall not constitute a waiver of Agency’s right. Agency’s failure to
exercise said right in connection with any particular event or series of events shall not be
construed as a waiver of the provisions hereof as regards that event or any subsequent event.
Notwithstanding anything in this Note to the contrary, the Agency agrees that during the 15-year
tax credit compliance period for the Project’s Low and Moderate Income Housing Tax Credits,
the Agency will not accelerate payment of the amounts owing on this Note or commence
foreclosure proceedings under the Commercial Deed of Trust.
11. (a) Subject to the extensions of time set forth in Section 12, and subject to the
further provisions of this Section 11, failure or delay by Borrower to perform any material term
or provision of this Note, the DDA, the Commercial Deed of Trust, or the Agreement Containing
Covenants constitutes a default under this Note.
(b) Agency shall give written notice of default to Borrower, specifying the
default complained of by the Agency. Delay in giving such notice shall not constitute a waiver
of any default nor shall it change the time of default.
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(c) Any failures or delays by Agency 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. Delays by Agency in asserting any of its rights and remedies shall not deprive Agency
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.
(d) If a monetary event of default occurs, prior to exercising any remedies
hereunder, the Agency shall give the Borrower written notice of such default. The Borrower
shall have a period of ten (10) days after such notice is given within which to cure the default
prior to exercise of remedies by the Agency.
(e) If a non-monetary event of default occurs, prior to exercising any remedies
hereunder, the Agency shall give Borrower notice of such default. If the default is reasonably
capable of being cured within thirty (30) days, Borrower shall have such period to effect a cure
prior to exercise of remedies by the Agency. If the default is such that it is not reasonably
capable of being cured within thirty (30) days, and Borrower (i) initiates corrective action within
said period, and (ii) diligently, continually, and in good faith works to effect a cure as soon as
possible, then Borrower shall have such additional time as is reasonably necessary to cure the
default prior to exercise of any remedies by the Agency. If Developer fails to take corrective
action or cure the default within a reasonable time, the Agency shall give Developer and, as
provided in paragraph (f), below, the Investor Limited Partner, notice thereof, whereupon the
Investor Limited Partner may remove and replace the General Partner with a substitute general
partner, who shall effect a cure within a reasonable time thereafter in accordance with the
foregoing provisions. The Agency agrees to accept cures tendered by the Investor Limited
Partner within the cure periods provided in this Note or within the time periods provided in Civil
Code Section 2924c, whichever is longer. Additionally, in the event the Investor Limited Partner
is precluded from curing a non-monetary default due to an inability to remove the General
Partner as a result of a bankruptcy, injunction, or similar proceeding by or against Developer or
its General Partner, the Agency agrees to forbear from completing a foreclosure (judicial or
nonjudicial) during the period during which the Investor Limited Partner is so precluded from
acting, not to exceed 90 days, provided such limited partner is otherwise in compliance with the
foregoing provisions. In no event shall the Agency be precluded from exercising remedies if its
security becomes or is about to become materially jeopardized by any failure to cure a default or
the default is not cured within ninety (90) days after the first notice of default is given.
(f) After Borrower gives written notice to the Agency that the Investor
Limited Partner has been admitted to the Limited Partnership, the Agency shall send to the
Investor Limited Partner a copy of all notices of default and all other notices that the Agency
sends to Borrower, at the address for the Investor Limited Partner given in Section 16 of this
Note.
(g) Any notice of default shall be deemed given only if either (i) dispatched
by first class mail, registered or certified, postage prepaid, return receipt requested, to the
addresses specified for the Borrower and the Investor Limited Partner in Section 16 of this Note,
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or (ii) by personal delivery (including by means of professional messenger or courier service
such as United Parcel Service or Federal Express) to the addresses specified for the Borrower
and the Investor Limited Partner in Section 16 of this Note. Receipt shall be deemed to have
occurred on the date marked on a written postal service or messenger or courier service receipt as
the date of delivery or refusal of delivery (or attempted delivery if undeliverable). If either party
gives notice of a change of address in the manner specified in this paragraph, all notices,
demands and communications originated after receipt of the change of address (or the effective
date specified in the notice of change of address, if later) shall be transmitted, delivered or sent to
the new address.
12. Notwithstanding specific provisions of this Note, non-monetary performance
hereunder shall not be deemed to be in default where delays are due to causes beyond the control
and without the fault of the party claiming an extension of time to perform (a “Force Majeure
Delay”), provided that they actually delay and interfere with the timely performance of the
matter to which they would apply and despite the exercise of diligence and good business
practices are or would be beyond the reasonable control of the party claiming such interference,
including: war; insurrection; strikes; lock-outs; 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 including litigation challenging
the validity of this transaction or any element thereof; unusually severe weather; inability to
secure necessary labor, materials or tools; delays of any contractor, subcontractor, or suppliers;
acts of the other party; acts or failure to act of any Governmental Agency (except acts or failure
to act of Agency shall not excuse performance by Agency); the imposition of any applicable
moratorium by a Governmental Agency; or any other causes which despite the exercise of
diligence and good business practices are or would be beyond the reasonable control of the party
claiming such delay and interference. Notwithstanding the foregoing, none of the foregoing
events shall constitute a Force Majeure Delay unless and until the party claiming such delay and
interference delivers to the other party written notice describing the event, its cause, when and
how such party obtained knowledge, the date the event commenced, and the estimated delay
resulting therefrom. Any party claiming a Force Majeure Delay shall deliver such written notice
within ten (10) business days after it obtains actual knowledge of the event.
13. If the rights created by this Note shall be held by a court of competent jurisdiction
to be invalid or unenforceable as to any part of the obligations described herein, the remaining
obligations must be completely performed and paid.
14. The Commercial Deed of Trust securing this Note shall be subordinate and junior
in all respects to the liens, terms, covenants and conditions of the Senior Deed of Trust, to the
extent and in the manner provided in that certain subordination agreement with Senior Lender dated
on or about the date hereof (the “Subordination Agreement”). The rights and remedies of the payee
and each subsequent holder of this Note under the Commercial Deed of Trust securing this Note are
subject to the restrictions and limitations set forth in the Subordination Agreement. Each
subsequent holder of this Note shall be deemed, by virtue of such holder’s acquisition of the Note,
to have agreed to perform and observe all of the terms, covenants and conditions to be performed or
observed by the Agency under the Subordination Agreement.
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15. (a) The obligation to repay the Commercial Loan is a nonrecourse obligation
of the Borrower and its partners. Neither the Borrower nor any of its general or limited partners,
nor any other party, shall have any personal liability for repayment of the loan. The sole
recourse of the Agency with respect to repayment of the Commercial Loan shall be the exercise
of its rights against the Property and the improvements thereon and any related security for the
Commercial Loan. Provided, however, that the foregoing shall not (i) constitute a waiver of any
obligation evidenced by the Commercial Loan Documents, the Agreement Containing Covenants
or the Environmental Indemnity; (ii) prevent or in any way hinder the Agency from exercising,
or constitute a defense, an affirmative defense, a counterclaim, or other basis for relief in respect
of the exercise of, any remedy prescribed by law or in equity in case of default, other than
repayment of the Commercial Loan; or (iii) relieve Borrower of any of its obligations under any
indemnity delivered by Borrower to the Agency. The foregoing provisions of this paragraph are
limited by the provision that in the event of the occurrence of a default, Borrower and its
successors and assigns shall have personal liability hereunder for any deficiency judgment, but
only if and to the extent Borrower, its principals, shareholders, partners or its successors and
assigns received rentals, other revenues, or other payments or proceeds in respect of the
mortgaged Property during the continuance of such default, which rentals, other revenues, or
other payments or proceeds have not been used for the payment of ordinary and reasonable
operating expenses of the mortgaged Property, ordinary and reasonable capital improvements to
the mortgaged Property, debt service, real estate taxes in respect of the mortgaged Property and
basic management fees, but not incentive fees, payable to an entity or person unaffiliated with
Borrower in connection with the operation of the mortgaged Property, which are then due and
payable.
(b) Notwithstanding the foregoing, the Agency may obtain a judgment or order
(including, without limitation, an injunction) requiring any Person to perform (or refrain from)
specified acts other than repayment of the Commercial Loan; may proceed against any Person
whatsoever with respect to the enforcement of any guarantees, surety bonds, letters of credit,
reimbursement agreements or similar rights to payment or performance; and may recover
directly from any Person:
(i) any damages, costs and expenses incurred by Agency as a result of fraud,
misrepresentation or any criminal act or acts of Borrower or any member,
partner, shareholder, officer, director or employee of (a) Borrower or (b)
any of Borrower’s members or general partners or (c) any member or
partner of any of Borrower’s members or general partners;
(ii) any damages, costs and expenses incurred by Agency as a result of any
misappropriation of funds provided for the construction of the Project,
rents and revenues from the operation of the Project, or proceeds of
insurance policies or condemnation proceeds;
(iii) any and all amounts owing by Borrower pursuant to Borrower’s
indemnification regarding Hazardous Substances; and
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(iv) all court costs and attorneys’ fees reasonably incurred in enforcing or
collecting upon any of the foregoing exceptions.
16. (a) The address of Borrower for purposes of receiving notices pursuant to this
Note is as follows:
c/o Los Angeles Housing Partnership
Attn: Mary Silverstein, President and Executive Director
1200 Wilshire Boulevard, Suite 307
Los Angeles, California 90017
With a copy to:
Bocarsly Emden Cowan Esmail & Arndt LLP
Attn: Kyle Arndt, Esq.
633 West Fifth Street, 70th Floor
Los Angeles, California 90071
(b) The address of Investor Limited Partner for purposes of receiving notices
pursuant to this Note is as follows:
Hudson Housing Capital, LLC
630 Fifth Avenue, 28
th
Floor
New York, NY 10111
Attn: Joseph A. Macari
17. In addition to the other terms of this Note, the Borrower hereby agrees and
acknowledges that, notwithstanding any internal accounting procedures or provision pertaining
to the use of receipts, payments, reserves and distributions contained in its partnership agreement
or other organizational document, the terms of this Note and the DDA shall control as to the
repayment of the Commercial Loan.
18. Neither this Note nor any term hereof may be waived, amended, discharged,
modified, changed or terminated orally; nor shall any waiver of any provision hereof be effective
except by an instrument in writing signed by the Agency and Borrower.
19. Notwithstanding any provision in this Note, the Commercial Deed of Trust or other
document securing same, the total liability for payment in the nature of interest shall not exceed the
limit imposed by applicable laws of the State of California.
20. This Note has been executed and delivered by Borrower in the State of California
and is to be governed and construed in accordance with the internal laws thereof, disregarding the
rules governing conflict of laws.
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21. Every provision of this Note is intended to be severable. In the event any term or
provision hereof is declared by a court of competent jurisdiction to be illegal, invalid or
unenforceable for any reason whatsoever, such illegality, invalidity or unenforceability shall not
affect the balance of the terms and provisions hereof, which terms and provisions shall remain
binding and enforceable, and this Note shall be construed as if such illegal, invalid or
unenforceable term or provision had not been contained herein.
22. Time is of the essence in the performance of each provision hereof.
[Remainder of Page Intentionally Left Blank; Signatures on Following Page]
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IN WITNESS WHEREOF Borrower has executed this Note as of the day and year set
forth above.
BORROWER:
TILDEN TERRACE, L.P.,
a California limited partnership
By: Los Angeles Housing Partnership, Inc.
a California nonprofit public benefit corporation
Its: Managing General Partner
By: _________________________
Mary Silverstein
Its: President and Executive Director
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EXHIBIT NO. 12
FORM OF COMMERCIAL DEED OF TRUST
When Recorded Return to:
CULVER CITY REDEVELOPMENT
AGENCY
9770 Culver Boulevard
Culver City, California 90232-0507
Attn: John Fisanotti,
Redevelopment Project Manager
SPACE ABOVE THIS LINE FOR RECORDING USE
Parcel Number: 4213-007-001, 4213-007-901, 4213-007-900 OFFICIAL BUSINESS
Document Entitled to Free Recording
Per Government Code §27383
DEED OF TRUST, SECURITY AGREEMENT AND FIXTURE FILING
(WITH ASSIGNMENT OF RENTS)
BY TILDEN TERRACE, L.P. FOR THE BENEFIT OF
THE CULVER CITY REDEVELOPMENT AGENCY
(TAX INCREMENT FUNDS)
This Deed of Trust, Security Agreement and Fixture Filing (With Assignment of Rents),
dated as of ________________, 2011 is made by TILDEN TERRACE, L.P., a California limited
partnership (hereinafter referred to as “Trustor”) (whose address is 1200 Wilshire Boulevard, Suite
307, Los Angeles, California 90017, to LAWYERS TITLE, (hereinafter called “Trustee”), for the
benefit of the CULVER CITY REDEVELOPMENT AGENCY, a public body corporate and politic
(hereinafter called “Beneficiary”), whose address is 9770 Culver Boulevard, Culver City, California
90230-0507.
Witnesseth: That Trustor IRREVOCABLY GRANTS, TRANSFERS AND ASSIGNS to Trustee,
its successors and assigns, in Trust, with POWER OF SALE TOGETHER WITH RIGHT OF
ENTRY AND POSSESSION all present and future right, title and interest of Trustor in and to the
following property (the “Trust Estate”):
(1) All of Trustor’s rights, title and interest in and to that certain real property in the City of
Culver City, County of Los Angeles, State of California more particularly described in Exhibit “A”
attached hereto and by this reference made a part hereof (hereafter referred to as the “Subject
Property”);
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(2) All buildings, structures and other improvements now or in the future located or to be
constructed on the Subject Property (the “Improvements”);
(3) all tenements, hereditaments, appurtenances, privileges, franchises and other rights
and interests now or in the future benefiting or otherwise relating to the Subject Property or the
Improvements, including easements, rights-of-way and development rights (the “Appurtenances”).
(The Appurtenances, together with the Subject Property and the Improvements, are hereafter
referred to as the “Real Property”);
(4) subject to the assignment to Beneficiary set forth in Paragraph 4 below, all rents,
issues, income, revenues, royalties and profits now or in the future payable with respect to or
otherwise derived from the Trust Estate or the ownership, use, management, operation, leasing or
occupancy of the Trust Estate, including those past due and unpaid (the “Rents”);
(5) all inventory, equipment, fixtures and other goods (as those terms are defined in
Division 9 of the California Uniform Commercial Code (the “UCC”), and whether existing now or
in the future) now or in the future located at, upon or about, or affixed or attached to or installed in,
the Real Property, or used or to be used in connection with or otherwise relating to the Real Property
or the ownership, use, development, construction, maintenance, management, operation, marketing,
leasing or occupancy of the Real Property, including furniture, furnishings, machinery, appliances,
building materials and supplies, generators, boilers, furnaces, water tanks, heating ventilating and air
conditioning equipment and all other types of tangible personal property of any kind or nature, and
all accessories, additions, attachments, parts, proceeds, products, repairs, replacements and
substitutions of or to any of such property, but not including personal property that is donated to
Trustor (the “Goods,” and together with the Real Property, the “Property”); and
(6) all accounts, general intangibles, chattel paper, deposit accounts, money, instruments
and documents (as those terms are defined in the UCC) and all other agreements, obligations, rights
and written material (in each case whether existing now or in the future) now or in the future relating
to or otherwise arising in connection with or derived from the Property or any other part of the Trust
Estate or the ownership, use, development, construction, maintenance, management, operation,
marketing, leasing, occupancy, sale or financing of the property or any other part of the Trust Estate,
including (to the extent applicable to the Property or any other portion of the Trust Estate) (i)
permits, approvals and other governmental authorizations, (ii) improvement plans and specifications
and architectural drawings, (iii) agreements with contractors, subcontractors, suppliers, project
managers, supervisors, designers, architects, engineers, sales agents, leasing agents, consultants and
property managers, (iv) takeout, refinancing and permanent loan commitments, (v) warranties,
guaranties, indemnities and insurance policies, together with insurance payments and unearned
insurance premiums, (vi) claims, demands, awards, settlements, and other payments arising or
resulting from or otherwise relating to any insurance or any loss or destruction of, injury or damage
to, trespass on or taking, condemnation (or conveyance in lieu of condemnation) or public use of any
of the Property, (vii) license agreements, service and maintenance agreements, purchase and sale
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agreements and purchase options, together with advance payments, security deposits and other
amounts paid to or deposited with Trustor under any such agreements, (viii) reserves, deposits,
bonds, deferred payments, refunds, rebates, discounts, cost savings, escrow proceeds, sale proceeds
and other rights to the payment of money, trade names, trademarks, goodwill and all other types on
intangible personal property of any kind or nature, and (ix) all supplements, modifications,
amendments, renewals, extensions, proceeds, replacements and substitutions of or to any of such
property (the “Intangibles”).
Trustor further grants to Trustee and Beneficiary, pursuant to the UCC, a security interest in
all present and future right, title and interest of Trustor in and to all Goods and Intangibles and all of
the Trust Estate described above in which a security interest may be created under the UCC
(collectively, the “Personal Property”). This Deed of Trust constitutes a security agreement under
the UCC, conveying a security interest in the Personal Property to Trustee and Beneficiary. Trustee
and Beneficiary shall have, in addition to all rights and remedies provided herein, all the rights and
remedies of a “secured party” under the UCC and other applicable California law. Trustor
covenants and agrees that this Deed of Trust constitutes a fixture filing under Sections 9502(c) and
9604 of the UCC.
FOR THE PURPOSE OF SECURING, in such order of priority as Beneficiary may elect,
all of the following:
(1) Due, prompt and complete observance, performance and discharge of each and every
condition, obligation, covenant and agreement contained herein or contained in the following (the
“Secured Obligations”):
(a) a promissory note in the face amount of $3,395,000, payable from the
residual receipts of the Project, executed by Trustor (“Borrower” therein) of even
date herewith (the “Commercial Note”);
(b) the Disposition and Development Agreement dated as of March 21, 2011, by
and between Trustor (“Developer” therein) and Beneficiary (“Agency” therein) (the
“DDA”); and
(c) the Agreement Containing Covenants Affecting Real Property (Including
Affordable Housing Restrictions) dated as of __________, 2011 by and between
Trustor (“Owner” therein) and Beneficiary (“Agency” therein), recorded
concurrently herewith (“Agreement Containing Covenants”).
(2) Payment of indebtedness of the Trustor to the Beneficiary in the principal amount of
$3,395,000 or so much thereof as shall be advanced, evidenced by the Commercial Note, with
interest, according to the terms of the Commercial Note.
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(3) Payment and performance of all future advances and other obligations that the then
record owner of all or part of the Property may agree to pay and/or perform (whether as principal,
surety or guarantor) for the benefit of Beneficiary, when such future advance of obligation is
evidenced by a writing which recites that it is secured by this Deed of Trust.
The DDA, including all Attachments thereto, and the documents and instruments executed by
Trustor in connection with the Project, including the Agreement Containing Covenants, the
Commercial Note, the Assignment of Rents, the Assignment of Agreements, and the UCC1
Financing Statement, all as described in the DDA and all of their terms are incorporated herein by
reference and this conveyance shall secure any and all extensions, amendments, modifications or
renewals thereof however evidenced. Any capitalized term that is not otherwise defined in this Deed
of Trust shall have the meaning ascribed to such term in the DDA.
AND TO PROTECT THE SECURITY OF THIS DEED OF TRUST, TRUSTOR
COVENANTS AND AGREES:
1. That Trustor shall pay the Commercial Note at the time and in the manner provided
therein, and perform the obligations of the Trustor as set forth in the Secured Obligations at the time
and in the manner respectively provided therein;
2. That Trustor shall not permit or suffer the use of any of the Property for any purpose
other than the uses permitted by the Secured Obligations;
3. That the Secured Obligations are incorporated in and made a part of this Deed of
Trust. Upon default of a Secured Obligation, and after the giving of notice and the expiration of any
applicable cure period, the Beneficiary, at its option, may declare the whole of the indebtedness
secured hereby to be due and payable.
4. That, subject to the prior rights, if any, of a lender whose lien is senior to this Deed of
Trust (“Senior Lender”), all rents, profits and income from the Trust Estate are assigned to the
Beneficiary for the purpose of discharging the debt hereby secured. Permission is hereby given to
Trustor so long as no default exists hereunder after the giving of notice and the expiration of any
applicable cure period, to collect such rents, profits and income for use in accordance with the
provisions of the Secured Obligations.
5. That upon default hereunder or under the aforementioned agreements, and after the
giving of notice and the expiration of any applicable cure period, Beneficiary shall be entitled to the
appointment of a receiver by any court having jurisdiction, without notice, to take possession and
protect the Trust Estate and operate same and collect the rents, profits and income therefrom;
6. That Trustor will keep the Improvements insured against loss by fire and such other
hazards, casualties, and contingencies as may reasonably be required in writing from time to time by
the Beneficiary, and all such insurance shall be evidenced by standard fire and extended coverage
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insurance policy or policies. In no event shall the amounts of coverage be less than 100 percent of
the insurable value of the Property. Such policies shall be endorsed with standard mortgage clause
with loss payable to the Beneficiary and certificates thereof together with copies of original policies
shall be deposited with the Beneficiary;
7. To pay, at least 10 days before delinquency, any taxes and assessments affecting the
Property; to pay, when due, all encumbrances, charges and liens, with interest, on the Property or
any part thereof which appear to be prior or superior hereto; and to pay all costs, fees, and expenses
of this Trust. Notwithstanding anything to the contrary contained in this Deed of Trust, Trustor shall
not be required to pay and discharge any such tax, assessment, charge or levy so long as Trustor is
contesting the legality thereof in good faith and by appropriate proceedings, and Trustor has
adequate funds to pay any liabilities contested pursuant to this Section 7.
8. To keep the Property in good condition and repair, subject to ordinary wear and tear,
casualty and condemnation, not to remove or demolish any buildings thereon; to complete or restore
promptly and in good and workmanlike manner any building which may be constructed, damaged,
or destroyed thereon and to pay when due all claims for labor performed and materials furnished
therefor; to comply with all laws affecting the Property or requiring any alterations or improvements
to be made thereon (subject to Trustor’s right to contest the validity or applicability of laws or
regulations); not to commit or permit waste thereof; not to commit, suffer or permit any act upon the
Property in violation of law and/or covenants, conditions and/or restrictions affecting the Property;
not to permit or suffer any material alteration of or addition to the Improvements without the consent
of the Beneficiary;
9. To appear in and defend any action or proceeding purporting to affect the security
hereof or the rights or powers of Beneficiary or Trustee, and to pay all costs and expenses, including
cost of evidence of title and reasonable attorney’s fees in a reasonable sum, in any such action or
proceeding in which Beneficiary or Trustee may appear;
10. Should Trustor fail to make any payment or do any act as herein provided, then
Beneficiary or Trustee, but without obligation so to do and without notice to or demand upon Trustor
and without releasing Trustor from any obligation hereof, may make or do the same in such manner
and to such extent as either may deem necessary to protect the security hereof. Following default,
after the giving of notice and the expiration of any applicable cure period, Beneficiary or Trustee
being authorized to enter upon said property for such purposes, may commence, appear in and/or
defend any action or proceeding purporting to affect the security hereof or the rights or powers of
Beneficiary or Trustee; may pay, purchase, contest, or compromise any encumbrance, charge, or lien
which in the judgment of either appears to be prior or superior hereto; and, in exercising any such
powers, may pay necessary expenses, employ counsel, and pay reasonable attorney fees.
Notwithstanding the foregoing, in the event of default under this Deed of Trust, the Beneficiary may
also require Trustor to maintain and submit additional records. Beneficiary shall specify in writing
the particular records that must be maintained and the information or reports that must be submitted;
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11. Beneficiary shall have the right to pay fire and other property insurance premiums
when due should Trustor fail to make any required premium payments. All such payments made by
the Beneficiary shall be added to the principal sum secured hereby;
12. To pay immediately and without demand all sums so expended by Beneficiary or
Trustee, under permission given under this Deed of Trust, with interest from date of expenditure at
the rate specified in the Commercial Note;
13. That the funds to be advanced hereunder are to be used in accordance with the
Secured Obligations and upon the failure of Trustor to keep and perform all the covenants,
conditions, and agreements of said agreements, the principal sum and all arrears of interest, and
other charges provided for in the Commercial Note shall at the option of the Beneficiary of this Deed
of Trust become due and payable, anything contained herein to the contrary notwithstanding;
14. Trustor further covenants that it will not voluntarily create, suffer, or permit to be
created against the property subject to this Deed of Trust any lien or liens except as permitted by the
Secured Obligations or otherwise approved by Beneficiary, and further that it will keep and maintain
the Property free from the claims of all persons supplying labor or materials which will enter into the
construction of any and all buildings now being erected or to be erected on said premises.
Notwithstanding anything to the contrary contained in this Deed of Trust, Trustor shall not be
obligated to pay any claims for labor, materials or services which Trustor in good faith disputes and
is diligently contesting, provided that Trustor shall, at Beneficiary’s written request, within thirty
(30) days after the filing of any claim or lien (but in any event, and without any requirement that
Beneficiary must first provide a written request, prior to foreclosure) record in the Office of the
Recorder of Los Angeles County, a surety bond in an amount one-and-one-half (12) times the
amount of such claim item to protect against a claim of lien, or provide such other security
reasonably satisfactory to Beneficiary;
15. That any and all improvements made or about to be made upon the premises covered
by the Deed of Trust, and all plans and specifications, comply with all applicable municipal
ordinances and regulations and all other applicable regulations made or promulgated, now or
hereafter, by lawful authority, and that the same will upon completion comply with all such
municipal ordinances and regulations and with the rules of the applicable fire rating or inspection
organization, bureau, association or office;
16. Trustor herein agrees to pay to Beneficiary or to the authorized loan servicing
representative of the Beneficiary a reasonable charge for providing a statement regarding the
obligation secured by this Deed of Trust as provided by Section 2954, Article 2, Chapter 2 Title 14,
Division 3, of the California Civil Code.
IT IS MUTUALLY AGREED THAT:
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17. Should the Property or any part thereof be taken or damaged by reason of any public
improvement or condemnation proceeding, or damaged by fire, or earthquake, or in any other
manner, subject to the rights of Senior Lender, Beneficiary shall be entitled to all compensation,
awards, and other payments or relief therefor which are not used to reconstruct, restore or otherwise
improve the Property or part thereof that was taken or damaged, and shall be entitled at its option to
commence, appear in and prosecute in its own name, any action or proceedings, or to make any
compromise or settlement, in connection with such taking or damage. Subject to the rights of the
Senior Lenders, all such compensation, awards, damages, rights of action and proceeds which are
not used to reconstruct, restore or otherwise improve the Property or part thereof that was taken or
damaged, including the proceeds of any policies of fire and other insurance affecting the Property,
are hereby assigned to Beneficiary. After deducting therefrom all its expenses, including attorney’s
fees, the balance of the proceeds which are not used to reconstruct, restore or otherwise improve the
Property or part thereof that was taken or damaged, shall be applied to the amount due under the
Commercial Note secured hereby. No amount applied to the reduction of the principal shall relieve
the Trustor from making regular payments as required by the Commercial Note. If the Commercial
Note has been repaid in full, the remainder of the balance shall revert to the Trustor;
18. Upon default by Trustor in making any payments provided for in the Commercial
Note secured hereby or in this Deed of Trust, or in performing any obligation set forth in any of the
Secured Obligations, and if such default is not cured within the respective time provided therefor in
Section 34 of this Deed of Trust, below, Beneficiary may declare all sums secured hereby
immediately due and payable by delivery to Trustee of written declaration of default and demand for
sale, and of written notice of default and of election to cause the property to be sold, which notice
Trustee shall cause to be duly filed for record and Beneficiary may foreclose this Deed of Trust.
Beneficiary shall also deposit with Trustee this Deed of Trust, the Note and all documents
evidencing expenditures secured hereby;
19. a. Prior to the repayment in full of the Agency Loan, the Trustor shall not assign
or attempt to assign the DDA or any right therein, nor make any total or partial sale, transfer,
conveyance or assignment of the whole or any part of the Property, the Improvements, or any
portion thereof or interest therein (referred to hereinafter as a “Transfer”), without prior written
approval of the Beneficiary, except as otherwise permitted in the Secured Obligations. Consent to
one such transaction shall not be deemed to be a waiver of the right to require consent to future or
successive transactions. Beneficiary shall not unreasonably withhold or delay its consent. If consent
should be given, any such transfer shall be subject to this Section 19, and any such transferee shall
assume all obligations hereunder and agree to be bound by all provisions contained herein, subject to
the provisions of paragraph e.(3) of this Section 19, below.
b. Any such proposed transferee shall have the qualifications and financial
responsibility necessary and adequate as may be reasonably determined by the Beneficiary, to fulfill
the obligations undertaken by Trustor in the Secured Obligations. Any such proposed transferee, by
instrument in writing satisfactory to the Beneficiary and in form recordable among the land records
of Orange County, for itself and its successors and assigns, and for the benefit of the Beneficiary
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shall expressly assume all of the obligations of the Trustor under the Secured Obligations, and agree
to be subject to all conditions and restrictions applicable to the Trustor in this Deed of Trust, subject
to the provisions of paragraph e.(3) of this Section 19. There shall be submitted to the Beneficiary
for review all instruments and other legal documents proposed to effect any such transfer; and if
approved by the Beneficiary its approval shall be indicated to the Trustor in writing.
c. In the absence of specific written agreement by the Beneficiary, no Transfer,
or approval thereof by the Beneficiary, shall be deemed to relieve the Trustor or any other party
from any obligations under the Secured Obligations.
d. In the event of a Transfer prior to the time the Agency Loan is paid in full and
without the prior written consent of the Beneficiary, the net proceeds (after repayment in full of the
Senior Loan and the reconveyance of the Senior Deed of Trust), shall be paid to the Beneficiary to
the extent necessary to pay in full the accrued interest, if any, current interest and remaining
principal balance of the Agency Loan.
e. (1) As used herein, “Transfer” includes the sale, agreement to sell, transfer
or conveyance of the Property, the Project, or any portion thereof or interest therein, whether
voluntary, involuntary, by operation of law or otherwise, the execution of any installment sale
contract or similar instrument affecting all or a portion of the Property or Project, the lease of all or
substantially all of the Property or Project, except as provided in subparagraph (3) below, or the
appointment of a receiver or trustee to operate or exercise direct or indirect control over any portion
of or interest in the Project or to operate or exercise direct or indirect control over any interest in any
general partner or member of Trustor or any general partner or member of a general partner or
member of Trustor.
(2) “Transfer” shall also include the transfer, assignment, hypothecation or
conveyance of legal or beneficial ownership of any interest in Developer or any general partner or
member of Trustor or of any general partner or member of a general partner or member of Trustor,
or any conversion of Trustor to an entity form other than that of Trustor at the time of execution of
this Agreement, except that, a cumulative change in ownership interest of any general partner of the
Trustor of forty-nine percent (49%) or less shall not be deemed a “Transfer” for purposes of this
Agreement.
(3) Notwithstanding paragraphs (1) and (2), “Transfer” shall not include
any of the following Permitted Transfers:
(i) a conveyance of a security interest to the beneficiary of the Senior Deed of
Trust or the conveyance of title to the Property or Project in connection with a foreclosure, a
deed in lieu of foreclosure or similar conversion of such loan;
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(ii) (1) A conveyance of the Project to a limited partnership in which the
Managing General Partner is Trustor or Trustor’s Managing General Partner, or a sale back from
such partnership to Trustor or such Managing General Partner.
(2) The substitution of a General Partner as directed by the Investor
Limited Partner in accordance with the terms of the Limited Partnership Agreement, subject to
the following terms and conditions. The Investor Limited Partner may substitute the Special
Limited Partner (or another reasonably acceptable Affiliate of Investor Limited Partner) (the
“Interim General Partner”) on an interim basis for a period reasonably calculated to identify and
admit into the partnership a new General Partner, as set forth below (the “Substitute General
Partner”). The Substitute General Partner must be an entity reasonably acceptable to the Agency,
which approval shall not be unreasonably withheld or delayed.
(iii) Any refinancing that repays any of the Senior Loan (referred to herein as a
“Take-out Loan”), if Beneficiary reasonably determines (which determination shall not be
unreasonably withheld) that (i) the resulting loan-to-value ratio (including the Take-out Loan
and any of the remaining Senior Loan not repaid by the refinancing) will not exceed the loan-to-
value ratio in effect at the time of the Permanent Financing Event for the initial development of
the Project, and the repayment terms of the Take-out Loan do not materially impair the Trustor’s
ability to repay the Agency Loan or (ii) the Take-out Loan is replacing a matured Senior Loan
and the amount of the Take-out Loan is equal to, or less than, the amount owing on the matured
Senior Loan.
(iv) The leasing for occupancy of all or any part of the Property or Project in
accordance with this Agreement and the Agreement Containing Covenants.
(v) The inclusion of equity participation by Trustor by transfer or addition of
limited partners to the Trustor or similar mechanism; provided that such transfer, addition or
other mechanism shall not involve any Prohibited Person or otherwise result in a violation of
Anti-Terrorism Laws.
(vi) The pledge by a General Partner to the Investor Limited Partner of the
General Partner’s interest in Trustor, as security for the performance of all of the General
Partner’s obligations under the Limited Partnership Agreement.
(vii) The sale, transfer or pledge of any limited partnership interest in the Trustor
or of any partnership interest in the Investor Limited Partner; provided that such sale, transfer or
pledge shall not be to any Prohibited Person or otherwise result in a violation of Anti-Terrorism
Laws.
(viii) Any dilution of the General Partner’s interest in the Trustor in accordance
with the Limited Partnership Agreement.
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20. After the lapse of such time as may then be required by law following the recordation
of a notice of default, and notice of sale having been given as then required by law, Trustee, without
demand on Trustor, shall sell the Property at the time and place fixed by it in the notice of sale,
either as a whole or in separate parcels, and in such order as it may determine at public auction to the
highest bidder for cash in lawful money of the United States, payable at time of sale. Trustee may
postpone sale of all or any portion of the Property by public announcement at the time and place of
sale, and from time to time thereafter may postpone the sale by public announcement at the time and
place of sale, and from time to time thereafter may postpone the sale by public announcement at the
time fixed by the preceding postponement. Trustee shall deliver to the purchaser its deed conveying
the property so sold, but without any covenant or warranty, express or implied. The recitals in the
deed of any matters or facts shall be conclusive proof of the truthfulness thereof. Any person,
including Trustor, Trustee or Beneficiary, may purchase at the sale. The Trustee shall apply the
proceeds of sale to payment of (1) the expenses of such sale, together with the reasonable expenses
of this trust including therein reasonable Trustee’s fees or attorney’s fees for conducting the sale,
and the actual cost of publishing, recording, mailing and posting notice of the sale; (2) the cost of
any search and/or other evidence of title procured in connection with such sale and revenue stamps
on Trustee’s deed; (3) all sums expended under the terms hereof, not then repaid, with accrued
interest at the rate specified in the Commercial Note; (4) all other sums then secured hereby; and (5)
the remainder, if any, to the person or persons legally entitled thereto;
21. Beneficiary may from time to time substitute a successor or successors to any Trustee
named herein or acting hereunder to execute this Trust. Upon such appointment, and without
conveyance to the successor trustee, the latter shall be vested with all title, powers, and duties
conferred upon any Trustee herein named or acting hereunder. Each such appointment and
substitution shall be made by written instrument executed by Beneficiary, containing reference to
this Deed of Trust and its place of record, which, when duly recorded in the proper office of the
county or counties in which the property is situated, shall be conclusive proof of proper appointment
of the successor trustee;
22. The pleading of any statute of limitations as a defense to any and all obligations
secured by this Deed of Trust is hereby waived to the full extent permissible by law;
23. Upon written request of Beneficiary stating that all sums secured hereby have been
paid and all obligations secured hereby have been satisfied, including but not limited to the
obligations set forth in the Agreement Containing Covenants, and upon surrender of this Deed of
Trust and any note, instrument or instruments setting forth all obligations secured hereby to Trustee
for cancellation and retention and upon payment of its fees, Trustee shall reconvey, without
warranty, the Property then held hereunder. The recitals in such reconveyance of any matters or fact
shall be conclusive proof of the truthfulness thereof. To the extent permitted by law, the grantee in
such reconveyance may be described as “the person or persons legally entitled thereto.” Neither
Beneficiary nor Trustee shall have any duty to determine the rights of persons claiming to be rightful
grantees of any reconveyance. When the Property has been fully reconveyed, the last such
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reconveyance shall operate as a reassignment of all future rents, issues and profits of the Property to
the person or persons legally entitled thereto;
24. The trust created hereby is irrevocable by Trustor;
25. This Deed of Trust applies to, inures to the benefit of, and binds all parties hereto,
their heirs, legatees, devisees, administrators, executors, successors, and assigns. The term
“Beneficiary” shall include not only the original Beneficiary hereunder but also any future owner
and holder including pledgees, of the Commercial Note secured hereby. In this Deed of Trust,
whenever the context so requires, the masculine gender includes the feminine and/or neuter, and the
singular number includes the plural. All obligations of Trustor hereunder are joint and several;
26. Trustee accepts this Trust when this Deed of Trust, duly executed and acknowledged,
is made public record as provided by law. Except as otherwise provided by law the Trustee is not
obligated to notify any party hereto of pending sale under this Deed of Trust or of any action or
proceeding in which Trustor, Beneficiary, or Trustee shall be a party unless brought by Trustee.
Beneficiary, at its option, may from time to time remove Trustee and appoint a successor trustee to
any Trustee appointed hereunder. Without conveyance of the Property, the successor trustee shall
succeed to all the title, power and duties conferred upon the Trustee herein and by applicable law;
27. The undersigned Trustor requests that a copy of any notice of default and of any
notice of sale hereunder be mailed to Trustor at the address set forth on the first page of this Deed of
Trust.
28. Trustor agrees at any time and from time to time upon receipt of a written request
from Beneficiary, to furnish to Beneficiary detailed statements in writing of income, rents, profits,
and operating expenses of the premises, and the names of the occupants and tenants in possession,
together with the expiration dates of their leases and full information regarding all rental and
occupancy agreements, and the rents provided for by such leases and rental and occupancy
agreements, and such other information regarding the premises and their use as may be requested by
Beneficiary.
29. Trustor agrees that the loan secured by this Deed of Trust is made expressly for the
purpose of financing the construction of Improvements on the Property, including 32 dwelling units
of affordable housing for Very Low Income, Low Income and Moderate Income Households, and
such dwelling units shall be occupied exclusively by such persons as set forth in the Secured
Obligations.
30. Trustor agrees that, except as otherwise provided in the Commercial Note, upon sale
or refinancing of the property, the entire principal balance of the debt secured by this Deed of Trust,
plus any accrued but unpaid interest thereon, shall at the option of Beneficiary be immediately due
and payable.
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31. a. The obligation to repay the Agency Loan is a nonrecourse obligation of the
Trustor and its partners. Neither the Trustor nor any of its general or limited partners, nor any other
party, shall have any personal liability for repayment of the loan. The sole recourse of the
Beneficiary with respect to repayment of the Agency Loan shall be the exercise of its rights against
the Property and the improvements thereon and any related security for the Agency Loan. Provided,
however, that the foregoing shall not (i) constitute a waiver of any obligation evidenced by the
Agency Loan Documents, the Agreement Containing Covenants or the Environmental Indemnity;
(ii) prevent or in any way hinder the Beneficiary from exercising, or constitute a defense, an
affirmative defense, a counterclaim, or other basis for relief in respect of the exercise of, any remedy
prescribed by law or in equity in case of default, other than repayment of the Agency Loan; or (iii)
relieve Trustor of any of its obligations under any indemnity delivered by Trustor to the Beneficiary.
The foregoing provisions of this paragraph are limited by the provision that in the event of the
occurrence of a default, Trustor and its successors and assigns shall have personal liability hereunder
for any deficiency judgment, but only if and to the extent Trustor, its principals, shareholders,
partners or its successors and assigns received rentals, other revenues, or other payments or proceeds
in respect of the mortgaged Property after the occurrence of such default, which rentals, other
revenues, or other payments or proceeds have not been used for the payment of ordinary and
reasonable operating expenses of the mortgaged Property, ordinary and reasonable capital
improvements to the mortgaged Property, debt service, real estate taxes in respect of the mortgaged
Property and basic management fees, but not incentive fees, payable to an entity or person
unaffiliated with Trustor in connection with the operation of the mortgaged Property, which are then
due and payable.
b. Notwithstanding the foregoing, the Beneficiary may obtain a judgment or order
(including, without limitation, an injunction) requiring any Person to perform (or refrain from)
specified acts other than repayment of the Agency Loan; may proceed against any Person
whatsoever with respect to the enforcement of any guarantees, surety bonds, letters of credit,
reimbursement agreements or similar rights to payment or performance; and may recover directly
from any Person:
(i) any damages, costs and expenses incurred by Beneficiary as a result of fraud,
misrepresentation or any criminal act or acts of Trustor or any member,
partner, shareholder, officer, director or employee of (a) Trustor or (b) any of
Trustor’s members or general partners or (c) any member or partner of any of
Trustor’s members or general partners;
(ii) any damages, costs and expenses incurred by the Beneficiary as a result of
any misappropriation of funds provided for the construction of the Project,
rents and revenues from the operation of the Project, or proceeds of insurance
policies or condemnation proceeds;
(iii) any and all amounts owing by Trustor pursuant to Trustor’s indemnification
regarding Hazardous Substances; and
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(iv) all court costs and attorneys’ fees reasonably incurred in enforcing or
collecting upon any of the foregoing exceptions.
32. Notwithstanding specific provisions of this Deed of Trust, non-monetary performance
hereunder shall not be deemed to be in default where delays or defaults are proximately caused by
any of the following Force Majeure events, provided such event actually delays and interferes with
the timely performance of the matter, and, despite the exercise of diligence and good business
practices, such event is beyond the reasonable control of Trustor: War; insurrection; strikes; lock-
outs; 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 including litigation challenging the validity of this transaction or any element
thereof; unusually severe weather; inability to secure necessary labor, materials or tools; delays of
any contractor, subcontractor, or suppliers; acts of the other party; acts or failure to act of any
Governmental Authority (except acts or failure to act of the Beneficiary shall not excuse
performance by the Beneficiary); the imposition of any applicable moratorium by a Governmental
Authority; or any other causes which despite the exercise of diligence and good business practices
are or would be beyond the reasonable control of the party claiming such delay and interference.
Notwithstanding the foregoing, none of the foregoing events shall constitute a Force Majeure Event
unless and until Trustor delivers to Beneficiary written notice describing the event, its cause, when
and how Trustor obtained knowledge, the date the event commenced, and the estimated delay
resulting therefrom. Trustor shall deliver such written notice within ten (10) business days after it
obtains actual knowledge of the event.
33. If the rights and liens created by this Deed of Trust shall be held by a court of
competent jurisdiction to be invalid or unenforceable as to any part of the Secured Obligations, the
unsecured portion of such obligations shall be completely performed and paid prior to the
performance and payment of the remaining and secured portion of the obligations, and all
performance and payments made by Trustor shall be considered to have been performed and paid on
and applied first to the complete payment of the unsecured portion of the obligations.
34. (a) Subject to the extensions of time set forth in Section 32, and subject to the further
provisions of this Section 34, failure or delay by Trustor to perform any term or provision
respectively required to be performed under the Secured Obligations or this Deed of Trust
constitutes a default under this Deed of Trust.
(b) Beneficiary shall give written notice of default to Trustor, specifying the
default complained of by the Beneficiary. Failure or delay in giving such notice shall not constitute
a waiver of any default nor shall it change the time of default.
(c) Any failures or delays by Beneficiary 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. Delays by Beneficiary in asserting any of its rights and remedies shall not deprive
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Beneficiary 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.
(d) If a monetary event of default occurs, prior to exercising any remedies
hereunder, Beneficiary shall give Trustor written notice of such default. Trustor shall have a period
of ten (10) days after such notice is given within which to cure the default prior to exercise of
remedies by Beneficiary.
(e) If a non-monetary event of default occurs, prior to exercising any remedies
hereunder, Beneficiary shall give Trustor notice of such default. If the default is reasonably capable
of being cured within thirty (30) days, Trustor shall have such period to effect a cure prior to
exercise of remedies by Beneficiary. If the default is such that it is not reasonably capable of being
cured within thirty (30) days, and Trustor (i) initiates corrective action within said period, and (ii)
diligently, continually, and in good faith works to effect a cure as soon as possible, then Trustor shall
have such additional time as is reasonably necessary to cure the default prior to exercise of any
remedies by Beneficiary. If Trustor fails to take corrective action or cure the default within a
reasonable time, Beneficiary shall give Trustor and, as provided in paragraph (f), below, the Investor
Limited Partner, notice thereof, whereupon the Investor Limited Partner may remove and replace the
general partner with a substitute general partner, who shall effect a cure within a reasonable time
thereafter in accordance with the foregoing provisions. Beneficiary agrees to accept cures tendered
by the Investor Limited Partner within the cure periods provided in this Deed of Trust or within the
time periods provided in Civil Code Section 2924c, whichever is longer. Additionally, in the event
the Investor Limited Partner is precluded from curing a non-monetary default due to an inability to
remove the General Partner as a result of a bankruptcy, injunction, or similar proceeding by or
against Trustor or its General Partner, Beneficiary agrees to forbear from completing a foreclosure
(judicial or nonjudicial) during the period during which the Investor Limited Partner is so precluded
from acting, not to exceed 90 days, provided such limited partner is otherwise in compliance with
the foregoing provisions. In no event shall Beneficiary be precluded from exercising remedies if its
security becomes or is about to become materially jeopardized by any failure to cure a default or the
default is not cured within ninety (90) days after the first notice of default is given.
(f) After Trustor gives written notice to Beneficiary that the Investor Limited
Partner has been admitted to the Trustor, Beneficiary shall send to the Investor Limited Partner a
copy of all notices of default and all other notices that Beneficiary sends to Trustor, at the address
for the limited partner as provided by written notice to Beneficiary by Trustor.
(g) Except as otherwise required to comply with the provisions of California Civil
Code Section 2924 et seq. that are applicable thereto, any notice of default that is transmitted by
electronic facsimile transmission followed by delivery of a “hard” copy, shall be deemed delivered
upon its transmission; any notice of default that is personally delivered (including by means of
professional messenger service, courier service such as United Parcel Service or Federal Express, or
by U.S. Postal Service), shall be deemed received on the documented date of receipt by Trustor; and
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any notice of default that is sent by registered or certified mail, postage prepaid, return receipt
required shall be deemed received on the date of receipt thereof.
35. This Deed of Trust shall be subordinate and junior to the Senior Deed of Trust, as
described in the DDA. The Executive Director of the Beneficiary or his designee shall execute such
instruments as may be necessary to subordinate the lien of this Deed of Trust, to the deed of trust
securing any Senior Loan. In the event of a default or breach by Trustor of any security instrument
securing a Senior Loan described in this Section 35, Beneficiary shall have the right to cure the
default prior to completion of any foreclosure. In such event, Beneficiary shall be entitled to
reimbursement by Trustor of all costs and expenses incurred by Beneficiary in curing the default.
The amount of any such disbursements shall be a lien against the Property and added to the
obligation secured by this Deed of Trust until repaid, with interest at the highest rate permitted by
law.
38. This Deed of Trust shall be subject to the terms and conditions set forth in that certain
Subordination Agreement, dated on or about the date hereof, by and among the Trustor, Senior
Lender and Beneficiary, as the same may be amended, restated, supplemented or modified from time
to time.
39. The Trustor has informed the Beneficiary that Trustor intends that the Project qualify
for an allocation of low-income housing tax credits under Section 42 of the Internal Revenue Code
(“Nine Percent Tax Credit”). In order to receive an allocation of tax credits, the Trustor will be
required to record in the real property records of the County of Los Angeles an “extended low-
income housing commitment” (as defined in Code Section 42(h)(6)(B)) (the “Extended Use
Agreement”). If the Trustor demonstrates to the reasonable satisfaction of Beneficiary that the
California Department of Housing and Community Development or applicable federal law requires
that the lien of this Deed of Trust be subordinate to the Extended Use Agreement, then the
Beneficiary shall execute a subordination agreement (“Extended Use Subordination Agreement”)
wherein the lien of this Deed of Trust is subordinated to the Extended Use Agreement. The
Extended Use Subordination Agreement will:
(a) provide that, if the Beneficiary or its successors or assigns (collectively, the
“REO Owner”) acquires the Property by foreclosure (or instrument in lieu of foreclosure), then the
“extended use period” (as defined in Code Section 42(h)(6)(D)) shall terminate, except for the
obligation of the REO Owner to comply with the limitations on evictions, termination of tenancy
and increase in rents for the three year period following the REO Owner’s acquisition of the
mortgaged property, as set forth in Code Section 42(h)(6)(E)(ii); and
(b) otherwise be in a form reasonably acceptable to Beneficiary.
[Remainder of Page Intentionally Left Blank; Signature Pages Follow]
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IN WITNESS WHEREOF Trustor has executed this Deed of Trust as of the day and year set
forth above.
“TRUSTOR”
TILDEN TERRACE, L.P.,
a California limited partnership
By: Los Angeles Housing Partnership, Inc.,
a California nonprofit public benefit corporation
Its: Managing General Partner
By: _________________________
Mary Silverstein
Its: President and Executive Director
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APPROVED BY:
“AGENCY”
CULVER CITY REDEVELOPMENT AGENCY,
a public body corporate and politic
By: _________________________________
John M. Nachbar
Executive Director
ATTEST:
By: _________________________________
Agency Secretary
APPROVED AS TO FORM:
By: _________________________________
General Counsel
By: _________________________________
KANE, BALLMER & BERKMAN
Agency Special Counsel
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]
State of California )
County of Los Angeles )
On ________________________________________ before me, __________________,
a Notary Public, personally appeared ______________________________, who proved to me
on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature_______________________________________ (Seal)
State of California )
County of Los Angeles )
On ________________________________________ before me, __________________,
a Notary Public, personally appeared ______________________________, who proved to me
on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature_______________________________________ (Seal)
ATTACHMENT 3
208
Exhibit A
LEGAL DESCRIPTION
ALL THAT CERTAIN REAL PROPERTY SITUATED IN THE COUNTY OF LOS
ANGELES, STATE OF CALIFORNIA, DESCRIBED AS FOLLOWS:
LOTS 1 AND 2 OF TRACT NO. 9648, IN THE CITY OF CULVER CITY COUNTY OF LOS
ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 142, PAGES 13, 14
AND 15 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY
And
LOT 3 OF TRACT 9648, AS SHOWN ON A MAP RECORDED IN BOOK 142, PAGES 13,
INCLUSIVE OF MISCELLANEOUS MAPS, RECORDS OF LOS ANGELES COUNTY,
CALIFORNIA
And
LOTS 4, 5, 6, 7 AND 8 OF TRACT NO. 9648, IN THE CITY OF CULVER CITY, COUNTY OF
LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 142,
PAGES(S) 13 TO 15 INCLUSIVE OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER
OF SAID COUNTY.
APN: 4213-007-001, 4213-007-901, 4213-007-900
ATTACHMENT 3
209ASSIGNMENT OF RENTS AND LEASES
PAGE 1
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15 Assignment of Rents and Leases v2
EXHIBIT NO. 13
FORM OF ASSIGNMENT OF RENTS AND LEASES
FREE RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
CULVER CITY REDEVELOPMENT AGENCY
9770 Culver Boulevard
Culver City, CA 90230-0507
Attn: John Fisanotti,
Redevelopment Project Manager
Parcel Number: 4213-007-001, 4213-007-900, 4213-007-901 OFFICIAL BUSINESS
Document Entitled to Free Recording
Per Government Code §27383
ASSIGNMENT OF RENTS AND LEASES FROM TILDEN TERRACE,
L.P. TO THE CULVER CITY REDEVELOPMENT AGENCY
THIS ASSIGNMENT OF RENTS AND LEASES (the “Assignment”) dated for
reference purposes ___________ __, 2011 is made by TILDEN TERRACE, L.P., a
California limited partnership (“Assignor”), in favor of THE CULVER CITY
REDEVELOPMENT AGENCY, a public body corporate and politic (the “Assignee”).
RECITALS
A. Assignor is the owner of the real property described in Exhibit “A”
attached hereto and the owner of all of the personalty, fixtures, and improvements now or
hereafter located thereon or attached thereto now existing or to be constructed thereon.
Said real property, personalty, fixtures, and the improvements are herein referred to
collectively as the “Property”.
B. Assignee has agreed to make two loans to Assignor in the original
principal amounts of Eleven Million Eight Hundred Five Thousand Dollars
($11,805,000) and Three Million Three Hundred Ninety-Five Thousand Dollars
($3,395,000) (individually and collectively, the “Loan”), pursuant to the terms of that
certain Disposition and Development Agreement by and between Assignor (“Developer”
therein) and Assignee (“Agency” therein) dated as of March __, 2011 (the “DDA”). The
ATTACHMENT 3
210ASSIGNMENT OF RENTS AND LEASES
PAGE 2
Tilden Terrace
15 Assignment of Rents and Leases v2
Loans are each evidenced by a Residual Receipts Promissory Note Secured by Deed of
Trust, of approximately even date herewith, executed by Assignor in favor of Assignee
(individually and collectively, the “Note”). Each Loan is secured by a Deed of Trust,
Security Agreement and Fixture Filing (With Assignment of Rents), of approximately
even date herewith, executed by Assignor, as Trustor, for the benefit of Assignee, as
Beneficiary (individually and collectively, the “Deed of Trust”).
C. Assignor and Assignee have entered into an Agreement Containing
Covenants Affecting Real Property (Including Affordable Housing Restrictions), of
approximately even date herewith, by and between Assignor (“Owner” therein) and
Assignee (“Agency” therein), recorded concurrently herewith (“Agreement Containing
Covenants”).
In order to induce Assignee to make the Loan to Assignor, Assignor has agreed to
execute this Assignment.
NOW THEREFORE, with reference to the foregoing and in reliance thereon and
for good and valuable consideration, the receipt of which is hereby acknowledged,
Assignor agrees as follows:
AGREEMENT
1. All initially capitalized terms used herein, unless otherwise defined or
required by context, shall have the meaning ascribed to them in the DDA.
2. Subject to the prior rights, if any, of a lender whose lien is senior to the
Deed of Trust held by Assignee (“Senior Lender”), Assignor hereby absolutely grants,
sells, assigns, transfers, and sets over to Assignee, by this Assignment, all of Assignor’s
interests, whether now existing or hereafter acquired, in all leases and other occupancy
agreements of any nature, now or hereafter covering all or any part of the Property,
together with all extensions, renewals, modifications, or replacements of said leases and
occupancy agreements, and together with any and all guarantees of the obligations of the
lessees and occupants (the “Lessees”) thereunder, whether now existing or hereafter
executed, and all extensions and renewals of said guarantees. (Said leases and occupancy
agreements, together with any and all guarantees, modifications, extensions and renewals
thereof, are hereinafter referred to collectively as the “Leases” and individually as a
“Lease”.)
3. Assignor’s purpose in making this Assignment is to relinquish to Assignee
its right to collect and enjoy the rents, royalties, issues, profits, income, and other benefits
at any time accruing by virtue of the Leases (hereinafter called “Rents and Profits”).
4. The parties intend that this Assignment shall be a present, absolute and
unconditional assignment and shall, immediately upon execution, give the Assignee the
right to collect the Rents and Profits and to apply them in payment of the principal and
ATTACHMENT 3
211ASSIGNMENT OF RENTS AND LEASES
PAGE 3
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15 Assignment of Rents and Leases v2
interest and all other sums payable on the indebtedness and other obligations under the
Note and other Loan documents, as well as all other sums payable under the Agreement
Containing Covenants, the Deed of Trust or any other instrument given as security for the
indebtedness. However, the Assignee hereby grants to Assignor a license to collect and
use, subject to the provisions set forth below, the Rents and Profits as they respectively
become due and to enforce the Leases, so long as there is no Default by Assignor in
performance of the terms, covenants, or provisions of the Agreement Containing
Covenants, the Deed of Trust, the Note, the DDA, this Assignment or any other Loan
document. Nothing contained herein, nor any collection of Rents and Profits by Assignee
or by a receiver, shall be construed to make Assignee a “mortgagee in possession” of the
Property so long as Assignee has not entered into actual possession of the Property.
5. Upon the occurrence of any Default or Event of Default under the terms
and conditions of this Assignment, the Note, the Deed of Trust, the DDA, the Agreement
Containing Covenants or any other Loan document, this Assignment shall constitute a
direction and full authority to each Lessee under any Lease and each guarantor of any
Lease to pay all Rents and Profits to Assignee without proof of the Default relied upon.
Assignor hereby irrevocably authorizes each Lessee and guarantor to rely upon and
comply with any notice or demand by Assignee for the payment to Assignee of any Rents
and Profits due or to become due.
6. Assignor represents and warrants, as of the Effective Date, as to each
Lease now or hereafter covering all or any portion of the Property, unless Assignee has
been otherwise advised in writing by Assignor:
a. That each Lease is in full force and effect;
b. That no material default exists on the part of the Lessee thereunder
or Assignor;
c. That no rent in excess of one month’s rent has been collected in
advance;
d. That no Lease or any interest therein, except to the extent required
by the Senior Lender, has been previously assigned or pledged; and
e. That all rent due to date under each Lease has been collected and
no concession has been granted to any Lessee in the form of a waiver, release, reduction,
discount, or other alteration of rent due or to become due except as previously disclosed
to Assignor in writing.
7. Assignor agrees with respect to each Lease:
a. If any Lease provides for a security deposit to be paid by the
Lessee to Assignor, then subject to the prior rights, if any, of a Senior Lender, this
ATTACHMENT 3
212ASSIGNMENT OF RENTS AND LEASES
PAGE 4
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15 Assignment of Rents and Leases v2
Assignment transfers to Assignee all of Assignor’s right, title, and interest in and to each
such security deposit; provided, however, that Assignor shall have the right to retain said
security deposit so long as Assignor is not in Default under this Assignment, the Deed of
Trust, the Note, the DDA, the Agreement Containing Covenants or any other Loan
document; and provided further that Assignee shall have no obligation to the Lessee with
respect to such security deposit unless and until Assignee comes into actual possession
and control of said security deposit.
b. If any Lease provides for the abatement of rent during repair of the
leased premises by reason of fire or other casualty, Assignor shall furnish rental insurance
to Assignee, the policies to be with companies and in form, content, policy limits, and
terms as are customary in the case of entities owning similar property or assets similarly
situated.
c. Each Lease shall remain in full force and effect despite any merger
of the interest of Assignor and any Lessee thereunder. Except as otherwise provided in
the DDA, Assignor shall not terminate any Lease (except pursuant to the terms of the
Lease upon a default by any Lessee thereunder), or materially modify or amend any
Lease or any of the terms thereof, or grant any concessions in connection therewith or
accept a surrender thereof, without the prior written consent of Assignee, which consent
shall not be unreasonably withheld.
d. Assignor shall not collect any Rents and Profits more than thirty
(30) days in advance of the date on which they become due under the terms of any Lease.
e. Assignor shall not discount any future accruing Rents and Profits.
f. Assignor shall not consent to any assignment of any Lease, or any
subletting thereunder, whether or not in accordance with its terms, on any terms less
favorable than those that would reflect an arm’s length transaction in light of prevailing
market conditions (subject to the rent restrictions applicable to the Property), without the
prior written consent of Assignee.
g. Assignor shall not execute any further assignment of any of the
Rents and Profits or any interest therein or suffer or permit any such assignment to occur
by operation of law.
h. Assignor shall faithfully perform and discharge all obligations of
the lessor under each Lease, and shall give prompt written notice to Assignee of any
notice of Assignor’s default received from any Lessee or any other person and furnish
Assignee with a complete copy of said notice. Assignor shall appear in and defend, at no
cost to Assignee, any action or proceeding arising under or in any manner connected with
any Lease. If requested by Assignee, Assignor shall enforce each Lease and all remedies
available to Assignor against the Lessee in the case of default under the Lease by the
Lessee.
ATTACHMENT 3
213ASSIGNMENT OF RENTS AND LEASES
PAGE 5
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15 Assignment of Rents and Leases v2
i. Except for residential leases entered into in the ordinary course of
business and in conformance with this Assignment, the DDA and the Agreement
Containing Covenants, Assignor shall give Assignee written notice immediately upon
entering into a Lease of any part of the Property and shall promptly upon request of
Assignee provide to Assignee a true and correct copy of each executed Lease. Upon
written notice from Assignee to Assignor, such Lease shall be deemed included in this
Assignment as though originally listed herein. At Assignee’s option, such notice may be
recorded, without cost to Assignor, in the Official Records of Los Angeles County,
California, which notice shall refer to this Assignment.
j. Except as otherwise provided in the DDA, Assignor shall not hire,
retain, or contract with any third party for property management services with respect to
the Property without the prior written approval of Assignee, to be granted, conditioned or
withheld at Assignee’s reasonable discretion, of such party and the terms of its contract
for management services.
k. Nothing herein shall be construed to impose any liability or
obligation on Assignee under or with respect to any Lease. Assignor shall indemnify,
defend, and hold Assignee, its officers, directors, agents, employees, and representatives
(the “Indemnitee(s)”) harmless from and against any and all liabilities, losses, and
damages that any Indemnitee may incur under any Lease or by reason of this
Assignment, and of and from any and all claims and demands whatsoever that may be
asserted against any Indemnitee by reason of any alleged obligations to be performed or
discharged by Assignee under any Lease or this Assignment. Should any Indemnitee
incur any liability, loss, or damage under any Lease or by reason of this Assignment and
such liability, loss, or damage falls within the foregoing indemnification, Assignor shall
immediately upon demand reimburse such Indemnitee for the amount thereof together
with all costs and expenses and reasonable attorneys’ fees and court costs incurred by
such Indemnitee. All of the foregoing sums shall bear interest at the maximum rate
permitted by law from demand by Indemnitee until paid. Any Rents and Profits collected
by Assignee may be applied by Assignee, in its discretion, in satisfaction of any such
liability, loss, damage, claim, demand, cost, expense, or fees.
8. Assignor hereby grants to Assignee the following rights:
a. Upon a default under this Assignment, the Note, the Deed of Trust,
the DDA, the Agreement Containing Covenants or any of the other Loan documents,
which is not cured within the time provided therefor, Assignee shall be deemed to be the
creditor of each Lessee in respect of any assignments for the benefit of creditors and any
bankruptcy, arrangement, reorganization, insolvency, dissolution, receivership, or other
debtor relief proceedings affecting such Lessee, without obligation on the part of
Assignee, however, to file timely claims in such proceedings or otherwise pursue
creditor’s rights therein.
ATTACHMENT 3
214ASSIGNMENT OF RENTS AND LEASES
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15 Assignment of Rents and Leases v2
b. Assignee shall have the right to assign Assignor’s right, title, and
interest in the Leases to any subsequent holder of the Note or any participating interest
therein or to any person acquiring title to all or any part of the Property through
foreclosure or otherwise. Any subsequent assignee shall have all the rights and powers
herein provided to Assignee.
c. Assignee shall have the right (but not the obligation), upon any
default under this Assignment, the Note, the Deed of Trust, the DDA, the Agreement
Containing Covenants or any of the other Loan documents, which is not cured within the
time provided therefor, to take any action as Assignee may deem necessary or appropriate
to protect its security, including but not limited to appearing in any action or proceeding
and performing any obligations of the lessor under any Lease; and Assignor agrees to
pay, on demand, all costs and expenses, including without limitation reasonable
attorneys’ fees and court costs incurred by Assignee in connection therewith, together
with interest thereon at the rate of ten percent (10%) per annum.
d. Upon any default under this Assignment, the Note, the Deed of
Trust, the DDA, the Agreement Containing Covenants or any of the other Loan
documents, which is not cured within the time provided therefor, and without notice to or
consent of Assignor, Assignee shall have the following rights (none of which shall be
construed to be obligations of Assignee):
i. Assignee shall have the right to use and possess, without
rental or charge, the Fixtures, Equipment, and Personal Property of the Assignor located
in or on the Property and used in the operation or occupancy thereof. Assignee shall have
the right to apply any of the Rents and Profits to pay installments due for Fixtures,
Equipment, and Personal Property rented or purchased on credit, insurance premiums on
Fixtures, Equipment, and Personal Property, or other charges relating to Fixtures,
Equipment, and Personal Property in or on the Property. However, this Assignment shall
not make Assignee responsible for the control, care, management, or repair of the
Property or any Fixtures, Equipment, or Personal Property or for the carrying out of any
of the terms or provisions of any Lease.
ii. Assignee shall have the right to apply the Rents and Profits
and any sums recovered by Assignee hereunder to the outstanding Indebtedness, as well
as to charges for taxes, insurance, improvements, maintenance, and other items relating to
the operation of the Property.
iii. Assignee shall have the right to take possession of the
Property, manage and operate the Property and Assignor’s business thereon, and to take
possession of and use all books of account and financial records of Assignor and its
property managers or representatives relating to the Property.
iv. Assignee shall have the right to execute new Leases of any
part of the Property, including Leases that extend beyond the term of the Deed of Trust.
ATTACHMENT 3
215ASSIGNMENT OF RENTS AND LEASES
PAGE 7
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15 Assignment of Rents and Leases v2
v. Assignee shall have the right to cancel or alter any existing
Leases.
vi. Assignee shall have the irrevocable authority, as Assignor’s
attorney-in-fact, such authority being coupled with an interest, to sign the name of
Assignor and to bind Assignor on all papers and documents relating to the operation,
leasing and maintenance of the Property.
e. All of the foregoing rights and remedies of Assignee are
cumulative, and Assignee shall also have upon the occurrence of any such Default or
Event of Default all other rights and remedies provided under the Note, the DDA, the
Deed of Trust, the Agreement Containing Covenants or any other Loan document or
other agreement between Assignor and Assignee, or otherwise available at law or in
equity or by statute.
9. Failure of Assignee to avail itself of any terms, covenants, or conditions of
this Assignment for any period of time or for any reason shall not constitute a waiver
thereof.
10. Notwithstanding any future modification of the terms of the Note, the
Deed of Trust, the DDA, the Agreement Containing Covenants, or any other Loan
document, this Assignment and the rights and benefits hereby assigned and granted shall
continue in favor of Assignee in accordance with the terms of this Assignment.
11. This Assignment shall be binding upon and inure to the benefit of the
respective heirs, legal representatives, successors, and assigns of the parties hereto
(including without limitation in the case of Assignee, any third parties now or hereafter
acquiring any interest in the Indebtedness or other obligations of Assignor under the Note
or Deed of Trust or a part thereof, whether by virtue of assignment, participation, or
otherwise). The words Assignor, Assignee, and Lessee, wherever used herein, shall
include the persons and entities named herein or in any Lease and designated as such and
their respective heirs, legal representatives, successors and assigns, provided that any
action taken by the named Assignee (or any successor designated as such by an
instrument recorded in the Official Records of Los Angeles County, California referring
to this Assignment) shall be sufficient for all purposes notwithstanding that Assignee may
have theretofore assigned or participated any interest in the obligation to a third party. All
words and phrases shall be taken to include the singular or plural number, and the
masculine, feminine, or neuter gender, as may fit the case.
12. Any change, amendment, modification, abridgment, cancellation, or
discharge of this Assignment or any term or provision hereof shall be invalid without the
written consent of Assignee.
ATTACHMENT 3
216ASSIGNMENT OF RENTS AND LEASES
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15 Assignment of Rents and Leases v2
13. Upon payment to Assignee of the full amount of the Indebtedness and the
full performance of other obligations secured hereby and by the Note and Deed of Trust,
as evidenced by a recorded satisfaction or release of the Deed of Trust, this Assignment
shall be void and of no further effect. In such event, Assignee shall cooperate with
Assignor to execute such instruments as may be reasonably necessary to remove the lien
of this instrument from the Official Records of Los Angeles County.
14. All notices, demands, approvals, and other communications provided for
in this Assignment shall be sufficiently given if: (i) personally delivered; (ii) delivered by
same day or overnight courier (acknowledged by receipt showing date and time of
delivery); or (iii) dispatched by registered or certified mail, postage prepaid, return
receipt requested, to the addresses set forth below:
If to Assignor: Tilden Terrace, L.P.
1200 Wilshire Boulevard, Suite 307
Los Angeles, California 90017
Attn: Mary Silverstein, President and Executive Director
With a copy to: Bocarsly Emden Cowan Esmail & Arndt LLP
633 West Fifth Street, 70th Floor
Los Angeles, California 90071
Attn: Kyle Arndt, Esq.
If to Assignee: Culver City Redevelopment Agency
9770 Culver Boulevard
Culver City, CA 90230-0507
Attn: Agency Executive Director
With a copy to: City Attorney’s Office
City of Culver City
9770 Culver Boulevard
Culver City, CA 90230-0507
And a copy to: Kane, Ballmer & Berkman
515 S. Figueroa St., Suite 1850
Los Angeles, California 90071
Attn: Deborah Rhoads, Esq.
Notices personally delivered or delivered by courier shall be effective upon receipt or
refusal to accept delivery. Mailed notices shall be effective on the earlier of (i) receipt of
refusal to accept delivery, or (ii) noon on the second business day following deposit in the
United States mail.
ATTACHMENT 3
217ASSIGNMENT OF RENTS AND LEASES
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15 Assignment of Rents and Leases v2
15. This Assignment may be recorded in the Official Records of Los Angeles
County, California, and Assignor shall pay all fees, charges, costs, and expenses of such
recording.
16. If any provision hereof is determined to be illegal or unenforceable for any
reason, the remaining provisions hereof shall not be affected thereby.
17. This Assignment shall be governed by and construed in accordance with
the internal laws of the State of California, without regard to the principles governing
conflicts of law.
18. If Assignee should bring any action to enforce its rights hereunder at law
or at equity, Assignor shall reimburse Assignee for all reasonable attorneys’ fees and
costs expended in connection therewith.
19. This Assignment shall be subject to the terms and conditions set forth in
that certain Subordination Agreement, dated on or about the date hereof, by and among
Assignor, [Senior Lender] and Assignee, as the same may be amended, restated,
supplemented or modified from time to time.
20. The Effective Date of this Assignment shall be the date it is executed by
Assignor.
IN WITNESS WHEREOF, the undersigned Assignor has executed this Assignment as of
the date first above written.
TILDEN TERRACE, L.P.,
a California limited partnership
By: Los Angeles Housing Partnership, Inc.
Its: Managing General Partner
Date: __________________ By: _________________________
Mary Silverstein
Its: President and Executive Director
ATTACHMENT 3
218
State of California )
County of Los Angeles )
On ________________________________________ before me,
__________________, a Notary Public, personally appeared
______________________________, who proved to me on the basis of satisfactory
evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their authorized
capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the
entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that
the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature_______________________________________ (Seal)
State of California )
County of Los Angeles )
On ________________________________________ before me,
__________________, a Notary Public, personally appeared
______________________________, who proved to me on the basis of satisfactory
evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their authorized
capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the
entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that
the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature_______________________________________ (Seal)
ATTACHMENT 3
219
ASSIGNMENT OF RENTS AND LEASES
LEGAL DESCRIPTION
Tilden Terrace
15 Assignment of Rents and Leases v2
EXHIBIT A
LEGAL DESCRIPTION
The land referred to herein is situated in the State of California, County of Los Angeles,
and described as follows:
LOTS 1 AND 2 OF TRACT NO. 9648, IN THE CITY OF CULVER CITY COUNTY
OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK
142, PAGES 13, 14 AND 15 OF MAPS, IN THE OFFICE OF THE COUNTY
RECORDER OF SAID COUNTY
And
LOT 3 OF TRACT 9648, AS SHOWN ON A MAP RECORDED IN BOOK 142,
PAGES 13, INCLUSIVE OF MISCELLANEOUS MAPS, RECORDS OF LOS
ANGELES COUNTY, CALIFORNIA
And
LOTS 4, 5, 6, 7 AND 8 OF TRACT NO. 9648, IN THE CITY OF CULVER CITY,
COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP
RECORDED IN BOOK 142, PAGES(S) 13 TO 15 INCLUSIVE OF MAPS, IN THE
OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
APN: 4213-007-001, 4213-007-901, 4213-007-900
ATTACHMENT 3
220
ASSIGNMENT OF AGREEMENTS
PAGE 1
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16 Assignment of Agreements v3
EXHIBIT NO. 14
FORM OF ASSIGNMENT OF AGREEMENTS
ASSIGNMENT OF AGREEMENTS FROM TILDEN TERRACE, L.P. TO THE
CULVER CITY REDEVELOPMENT AGENCY
1. FOR VALUE RECEIVED, the undersigned, TILDEN TERRACE, L.P., a
California limited partnership (“Assignor”), by this assignment dated for reference
purposes _______________, 2011, assigns to THE CULVER CITY
REDEVELOPMENT AGENCY, a public body, corporate and politic, (the “Assignee”),
all of its right, title and interest in and to:
a. All architectural, design, engineering and development agreements, and
any and all amendments, modifications, supplements, addenda and general
conditions thereto (collectively, “Architectural Agreements”); and
b. All plans and specifications, shop drawings, working drawings,
amendments, modifications, changes, supplements, general conditions and
addenda thereto (collectively “Plans and Specifications”)
heretofore or hereafter entered into or prepared by any architect, engineer or other person
or entity (collectively “Architect”), for or on behalf of Assignor in connection with the
construction of the Improvements on the Property described in Exhibit A attached. This
assignment is subject to the prior rights, if any, of a lender whose lien is senior to the
Deed of Trust held by Assignee. The Plans and Specifications, as of the date hereof, are
those which Assignor has heretofore, or will hereafter deliver to Assignee. The
Architectural Agreements include, but are not limited to, the architectural contracts for
this project between Assignor and [insert name of architect].
2. This ASSIGNMENT OF AGREEMENTS (“Assignment”) constitutes a present
and absolute assignment to Assignee as of the Effective Date, subordinate to a lender
whose lien is senior to the Deed of Trust held by Assignee (“Senior Lender”); provided,
however, Assignee confers upon Assignor the right to enforce the terms of the
Architectural Agreements and Assignor’s rights to the Plans and Specifications so long as
no Default or event which would constitute a Default after notice or the passage of time,
or both, has occurred under the Disposition and Development Agreement dated as of
March 21, 2011 between Assignee and Assignor (the “DDA”). Upon the occurrence of a
Default or event which would constitute a Default after notice or the passage of time, or
both, under the DDA, Assignee may, in its sole discretion, give notice to Architect of its
intent to enforce the rights of Assignor under the Architect Agreements and of its rights
to the Plans and Specifications and may initiate or participate in any legal proceedings
respecting the enforcement of said rights. Assignor acknowledges that by accepting this
ATTACHMENT 3
221
ASSIGNMENT OF AGREEMENTS
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16 Assignment of Agreements v3
Assignment, Assignee does not assume any of Assignor’s obligations under the
Architectural Agreements or with respect to the Plans and Specifications.
3. Assignor represents and warrants to Assignee, as of the Effective Date, that: (a)
all Architectural Agreements entered into by Assignor are in full force and effect and are
enforceable in accordance with their terms and no default, or event which would
constitute a default after notice or the passage of time, or both, exists with respect to said
Architectural Agreements; (b) all copies of the Architectural Agreements and Plans and
Specifications delivered to Assignee are complete and correct; and (c) Assignor has not
assigned any of its rights under the Architectural Agreements (other than to a Senior
Lender) or with respect to the Plans and Specifications except as expressly permitted by
the DDA.
4. Assignor agrees: (a) to pay and perform all obligations of Assignor under the
Architectural Agreements; (b) to enforce the payment and performance of all obligations
of any other person or entity under the Architectural Agreements; (c) not to modify the
existing Architectural Agreements nor to enter into any future Architectural Agreements
without Assignee’s prior written approval except as otherwise expressly permitted in the
DDA; and (d) not to further assign (other than assignment in connection with a Senior
Loan), for security or any other purposes, its rights under the Architectural Agreements
or with respect to the Plans and Specifications without Assignee’s prior written consent.
5. This Assignment secures performance by Assignor of all obligations of Assignor
under the DDA. This Assignment is supplemented by the provisions of the DDA and
said provisions are incorporated herein by reference.
6. The term “DDA” as used herein shall mean the Disposition and Development
Agreement dated as of March 21, 2011 between Assignor and Assignee, as well as any
future amendments thereto and any implementation agreements between Assignor and
Assignee. Capitalized terms not otherwise defined herein shall have the meaning set
forth in the DDA.
7. This Assignment shall be governed by the internal laws of the State of California
without reference to the principles regarding conflict of laws, except to the extent that
Federal laws preempt the laws of the State of California, and Assignor 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. If Assignee should
bring any action to enforce its rights hereunder at law or at equity, Assignor shall
reimburse Assignee for all reasonable attorneys’ fees and costs expended in connection
therewith.
8. This Assignment shall be binding upon and inure to the benefit of the heirs, legal
representatives, assigns, and successors-in-interest of Assignor and Assignee; provided,
however, this shall not be construed and is not intended to waive any restrictions on
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assignment, sale, transfer, mortgage, pledge, hypothecation or encumbrance by Assignor
contained in the DDA.
9. The attached Architect’s/Engineer’s Consent, Schedule 1 and Exhibit A are
incorporated by reference.
10. The Effective Date of this Assignment shall be the date it is executed by
Assignor.
11. This Assignment shall be subject to the terms and conditions set forth in that
certain Subordination Agreement, dated on or about the date hereof, by and among
Assignor, [Senior Lender] and Assignee, as the same may be amended, restated,
supplemented or modified from time to time.
IN WITNESS WHEREOF, the undersigned has executed this Assignment as of the date
set forth below.
“ASSIGNOR”
TILDEN TERRACE, L.P.,
a California limited partnership
By: Los Angeles Housing Partnership, Inc.,
a California nonprofit public benefit
corporation
Its: Managing General Partner
By: _________________________
Mary Silverstein
Its: President and Executive Director
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ARCHITECT’S CONSENT
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ARCHITECT’S CONSENT
The undersigned architect (“Architect”) hereby consents to the foregoing Assignment to
which this Architect’s Consent (“Consent”) is part, and acknowledges that there presently
exists no unpaid claims due to the Architect except as set forth on Schedule 1 attached
hereto, arising out of the preparation and delivery of the Plans and Specifications to
Assignor and/or the performance of the Architect’s obligations under the Architectural
Agreements.
Architect agrees that if, at any time, Assignee, pursuant to its rights under the DDA or the
loan documents, elects to undertake or cause the completion of the construction of the
Improvements on any portion of the Property, in accordance with the Plans and
Specifications, and gives Architect written notice of such election; THEN, so long as
Architect has received, receives or continues to receive the compensation called for under
the Architectural Agreements, Assignee 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 Architectural Agreements for the benefit and account
of Assignee in the same manner as if performed for the benefit or account of Assignor in
the absence of the Assignment.
Architect further agrees that, in the event of a breach by Assignor of the Architectural
Agreements, or any agreement entered into with Architect in connection with the Plans
and Specifications, so long as Assignor’s interest in the Agreements and Plans and
Specifications is assigned to Assignee, Architect will give written notice to Assignee of
such breach at the address shown below. Assignee shall have thirty (30) days from the
receipt of such written notice of default to remedy or cure said default. Nothing herein
shall require Assignee to cure said default or to undertake completion of the construction
of the Improvements.
Architect warrants and represents that it/he/she has no knowledge of any prior
assignment(s) of any interest in the Plans and Specifications and/or the Architectural
Agreements. Except as otherwise defined herein, the terms used herein shall have the
meanings given them in the Assignment.
Dated as of the date set forth below.
[insert name of architect]
Date: _______________, 2011 By: _______________________
Its:
[insert address]
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Assignee’s Address:
Culver City Redevelopment Agency
9770 Culver Boulevard
Culver City, CA 90230-0507
Attn: Agency Executive Director
With a copy to: City Attorney’s Office
City of Culver City
9770 Culver Boulevard
Culver City, CA 90230-0507
And a copy to: Kane, Ballmer & Berkman
515 S. Figueroa St., Suite 1850
Los Angeles, California 90071
Attn: Deborah Rhoads, Esq.
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ARCHITECT’S CONSENT
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SCHEDULE OF UNPAID CLAIMS
Schedule 1 to Assignment of Agreements dated for reference purposes, __________,
2011 between TILDEN TERRACE, L.P., as Assignor and THE CULVER CITY
REDEVELOPMENT AGENCY, as Assignee.
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LEGAL DESCRIPTION
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PROPERTY DESCRIPTION
Exhibit A to Assignment of Agreements dated for reference purposes ___________,
2011, between TILDEN TERRACE, L.P., as Assignor and THE CULVER CITY
REDEVELOPMENT AGENCY, as Assignee.
The land referred to herein is situated in the State of California, County of Los Angeles,
and described as follows:
LOTS 1 AND 2 OF TRACT NO. 9648, IN THE CITY OF CULVER CITY COUNTY
OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK
142, PAGES 13, 14 AND 15 OF MAPS, IN THE OFFICE OF THE COUNTY
RECORDER OF SAID COUNTY
And
LOT 3 OF TRACT 9648, AS SHOWN ON A MAP RECORDED IN BOOK 142,
PAGES 13, INCLUSIVE OF MISCELLANEOUS MAPS, RECORDS OF LOS
ANGELES COUNTY, CALIFORNIA
And
LOTS 4, 5, 6, 7 AND 8 OF TRACT NO. 9648, IN THE CITY OF CULVER CITY,
COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP
RECORDED IN BOOK 142, PAGES(S) 13 TO 15 INCLUSIVE OF MAPS, IN THE
OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
APN: 4213-007-001, 4213-007-901, 4213-007-900
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EXHIBIT NO. 15
FORM OF ENVIRONMENTAL INDEMNITY
ENVIRONMENTAL INDEMNITY BY TILDEN TERRACE, L.P. FOR THE BENEFIT
OF THE CULVER CITY REDEVELOPMENT AGENCY
THIS ENVIRONMENTAL INDEMNITY (this “Indemnity”), dated for reference
purposes ____________, 2011, and made by TILDEN TERRACE, L.P., a California limited
partnership (referred to as “Borrower”), whose address is 1200 Wilshire Boulevard, Suite 307,
Los Angeles, California 90017, in favor of THE CULVER CITY REDEVELOPMENT
AGENCY, a public body corporate and politic (the “Agency”), whose address is 9770 Culver
Boulevard, Culver City, CA 90230-0507.
WITNESSETH
WHEREAS, Borrower is the owner of the real property in the City of Culver City,
California described on Exhibit “A” attached hereto and made a part hereof, and the
improvements thereon (collectively referred to as the “Property”);
WHEREAS, Borrower and the Agency, entered into that certain Disposition and
Development Agreement, dated as of March 21, 2011 (the “DDA”), pursuant to which the
Agency agreed to make two loans to Borrower in the original principal amounts of Eleven
Million Eight Hundred Five Thousand Dollars ($11,805,000) and Three Million Three Hundred
Ninety Five Thousand Dollars ($3,395,000) (individually and collectively, the “Loan”) for the
purpose of constructing a 33-unit multifamily rental housing project and related commercial
space on the Property (the DDA and the documents and instruments referred to therein which are
being executed by Borrower concurrently herewith are referred to collectively herein as the
“Loan Documents”);
WHEREAS, Borrower has agreed to execute and deliver to the Agency this Indemnity to
induce the Agency to make the Loan.
NOW, THEREFORE, in consideration of the foregoing and in consideration of the
mutual agreements hereinafter set forth, Borrower hereby agrees with the Agency as follows:
1. DEFINITIONS
For the purpose of this Indemnity, “Hazardous Materials” or “Hazardous Substances”
shall include, but not be limited to, oil, flammable explosives, asbestos, urea formaldehyde
insulation, radioactive materials, hazardous wastes, toxic or contaminated substances or similar
materials, including, without limitation, any substances defined as “extremely hazardous
substances,” “hazardous substances,” “hazardous materials,” “hazardous waste” or “toxic
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substances” in the Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended, including the Superfund Amendments and Reauthorization Act of 1986, 42
U.S.C. Sections 9601 et seq. (“CERCLA”); the Hazardous Materials Transportation Act, 49
U.S.C. Sections 1801, et seq.; the Resource Conservation and Recovery Act of 1976, as
amended, 42 U.S.C. Sections 6901, et seq.; the Toxic Substances Control Act, as amended, 15
U.S.C. Section 2601 et seq.; the Clean Air Act, as amended, 42 U.S.C. Section 7401 et seq.; the
Federal Water Pollution Control Act, as emended, 33 U.S.C. Section 1251 et seq.; the
Occupational Safety and Health Act, as amended, 29 U.S.C. Section 651; the Emergency
Planning and Community Right-to-Know Act of 1986, 42 U.S.C. Section 11001 et seq.; the
Mine Safety and Health Act of 1977, as amended, 30 U.S.C. Section 801 et seq.; the Safe
Drinking Water Act, as amended, 42 U.S.C. Section 300f et seq.; and those substances defined as
“hazardous waste” in Section 25117 of the California Health and Safety Code, as “infectious
waste” in Section 25117.5 of the California Health and Safety Code, or as “hazardous
substances” in Section 25316 of the California Health and Safety Code or “hazardous materials”
as defined in Section 353 of the California Vehicle Code; and in the regulations adopted and
orders and publications promulgated pursuant to said laws. Such term shall not include
household consumer products or similar products readily available in the retail markets and
utilized in the quantity and manner commonly utilized in the occupancy, ownership or
development of multifamily rental real estate projects similar to the Project. Other capitalized
terms used in this Indemnity shall have the meanings ascribed to them in the DDA with the same
force and effect as if set forth in full below.
2. COVENANTS AND INDEMNITY
The following covenants, and indemnities are hereby given and made by Borrower:
2.1 Covenants.
(a) Borrower covenants that it will strictly comply with any and all laws,
regulations, and/or orders which may be promulgated from time to time relating to Hazardous
Materials (“Hazardous Materials Laws”), to immediately take, at Borrower’s sole expense, all
remedial action required by any Hazardous Materials Law or any judgment, consent decree,
settlement or compromise in respect to any Hazardous Materials Claim (as defined herein
below), and to keep the Property free of any lien imposed pursuant to any Hazardous Materials
Law or in relation to any Hazardous Materials Claim.
(b) Borrower covenants that the Property will not, while Borrower is the
owner of any portion thereof, be used for any activities involving, directly or indirectly, the use,
generation, treatment, storage, release, transportation, presence, discharge or disposal of any
Hazardous Materials, except for de minimis quantities used at the Property in strict compliance
with all Hazardous Materials Laws and required in connection with the routine construction,
operation and maintenance of the Property.
(c) The Agency shall have the right, at any time, to conduct an environmental
audit of the Property at the Agency’s expense, unless Hazardous Materials are found in
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quantities or conditions that violate the Hazardous Materials Laws, then at Borrower’s sole cost
and expense, and Borrower shall cooperate in the conduct of any such environmental audit.
Other than in an emergency, such audit shall be conducted only after ten (10) business days prior
notice has been given to Borrower and only in the presence of a representative of Borrower.
Borrower shall give the Agency and its agents and employees access to the Property to remove,
or otherwise to mitigate the effects of, Hazardous Materials and Borrower shall not unreasonably
delay or condition such access.
(e) Borrower shall not install, or permit to be installed, on the Property friable
asbestos or any substance containing asbestos and deemed hazardous by any Hazardous
Materials Laws, and, with respect to any such material currently present in the Property,
Borrower shall promptly either (i) remove or cause to be removed any material that such
Hazardous Materials Laws deem hazardous and require to be removed, or (ii) otherwise comply
with such Hazardous Materials Laws, all at Borrower’s sole cost and expense. If Borrower shall
fail to so do within the cure period permitted under applicable law, regulation, or order, the
Agency may do whatever is necessary to eliminate said substances from the premises or to
otherwise comply with all Hazardous Materials Laws, and the costs thereof shall be added to the
Obligations (as hereinafter defined) of Borrower under this Section 2.
(f) Borrower shall immediately advise the Agency in writing of any of the
following: (i) any pending or threatened claim against Borrower or the Property by any
governmental entity or agency or by any other person or entity relating to Hazardous Materials
or pursuant to the Hazardous Materials Laws (“Hazardous Materials Claims”), (ii) any known
condition or occurrence on the Property that (A) results in noncompliance by Borrower with any
Hazardous Materials Laws, (B) could reasonably be anticipated to cause the Property to be
subject to any restrictions on the ownership, occupancy, use or transferability of the Property
under any Hazardous Materials Law, or (C) could reasonably be anticipated to form the basis of
a Hazardous Materials Claim against the Property or Borrower.
2.2 Indemnity. Borrower hereby agrees to defend, indemnify, protect, and hold
harmless the Agency and its members, officers, officials, employees, agents, representatives,
servants, contractors, successors and assigns from and against any and all damages, losses,
liabilities, obligations, penalties, claims (including, without limitation, any third party tort
claims), litigation, demands, defenses, judgments, suits, proceedings, costs, disbursements, or
expenses (including, without limitation, attorneys’ and experts’ fees and disbursements) of any
kind or of any nature whatsoever, whether foreseeable or unforeseeable, (collectively, the
“Obligations”) which may at any time be imposed upon, incurred by or asserted or awarded
against the Agency as a direct or indirect consequence of:
(a) The presence of any Hazardous Materials on, in, under, or affecting all or
any portion of the Property or any surrounding areas;
(b) The breach of any covenant made by Borrower in Section 2.1 hereof; or
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(c) The enforcement by the Agency of any of the provisions of this Section
2.2 or the assertion by Borrower of any defense to its obligations hereunder.
Notwithstanding anything to the contrary set forth herein, the Borrower shall have no duty to
indemnify any party in connection with any Hazardous Materials introduced to the Property after
the Borrower’s sale of transfer of the entirety of its interests in and rights to the Property.
3. BORROWER’S UNCONDITIONAL OBLIGATIONS
3.1 Unconditional Obligations. Borrower hereby agrees that the Obligations will be
paid and performed strictly in accordance with the terms of this Indemnity, regardless of any
law, regulation, or order now or hereafter in effect in any jurisdiction affecting any of the Loan
Documents or affecting any of the rights of the Agency with respect thereto. The obligations of
Borrower hereunder shall be absolute and unconditional irrespective of, and Borrower waives
any defense based upon,
(a) The validity, regularity, or enforceability of the Loan Documents or any
other instrument or document executed or delivered in connection therewith;
(b) Any alteration, amendment, modification, release, termination, or
cancellation of any of the Loan Documents, or any change in the time, manner, or place of
payment of, or in any other term in respect of, all or any of the obligations of Borrower contained
in any of the Loan Documents;
(c) Any extension of the maturity of the Loan or any waiver of, or consent to
any departure from, any provision contained in any of the Loan Documents;
(d) Any exculpatory provision in any of the Loan Documents limiting the
Agency’s recourse to property encumbered by the Deed of Trust securing the Loan, or to any
other security, or limiting the Agency’s rights to a deficiency judgment against Borrower;
(e) Any exchange, addition, subordination, or release of, or nonperfection of
any lien on or security interest in, any collateral for the Loan, or any release, amendment, waiver
of, or consent to any departure from any provision of, any other surety or guarantee given in
respect of the Loan;
(f) The insolvency or bankruptcy of Borrower or Borrower’s members or of
any indemnitor or guarantor under any other indemnity or guarantee given in respect of the
Loan; or
(g) Any other circumstance that might otherwise constitute a defense
available to, or a discharge of, Borrower, Borrower’s members, or any other indemnitor or
guarantor with respect to the Loan or any or all of the Obligations.
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3.2 Continuation. The term of this Indemnity will continue until such time as no legal
action can be successfully brought against the Agency due to applicable statutes of limitation.
This Indemnity (a) is a continuing indemnity and shall remain in full force and effect until the
satisfaction in full of all of the Obligations (notwithstanding the payment in full of the Loan or
the release or other extinguishment of the Deed of Trust, or any other security for the Loan); and
(b) shall continue to be effective or shall be reinstated, as the case may be, if at any time any
payment of any of the Obligations is rescinded or must otherwise be returned by the Agency
upon the insolvency, bankruptcy, or reorganization of Borrower, Borrower’s members or
otherwise, all as though such payment had not been made.
3.3 Survival. Borrower’s duty to indemnify shall survive any judicial or non-judicial
foreclosure under the Deed of Trust securing the Loan or the or transfer of the Property in lieu
thereof, the release and reconveyance or cancellation of the Deed of Trust, and the satisfaction of
all of Borrower’s obligations under the Loan documents.
4. WAIVER
Borrower acknowledges that possible defenses to the enforceability of the Obligations
may presently exist and/or may arise hereafter and as part of the Agency’s consideration for
entering into the DDA, they have specifically bargained for the waiver and relinquishment by
Borrower of all such defenses. Borrower agrees that it has had the opportunity to seek and
receive legal advice from skilled legal counsel of its choosing and represents and confirms that
Borrower is fully informed regarding, and thoroughly understands, the nature of such possible
defenses, the circumstances under which they may arise, the benefits that they might confer upon
Borrower and the legal consequences to Borrower of waiving such defenses. Borrower makes
this Indemnity with the intent that this Indemnity and all of the waivers herein shall each and all
be fully enforceable by the Agency and that the Agency is induced to enter into the DDA in
material reliance upon such presumed full enforceability. Without limitation to the foregoing,
Borrower hereby waives the following:
(a) Promptness and diligence;
(b) Notice of acceptance and notice of the incurrence of any Obligation by Borrower;
(c) Notice of any action taken by the Agency, Borrower, or any other interested party
under any Loan Document or under any other agreement or instrument relating thereto;
(d) All other notices, demands, and protests, and all other formalities of every kind, in
connection with the enforcement of the Obligations, the omission of or delay in which, but for
the provisions of this Section 4, might constitute grounds for relieving Borrower of its
Obligations hereunder;
(e) To the fullest extent allowed by law, the right to a trial by jury with respect to any
dispute arising under, or relating to, this Indemnity;
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(f) Any requirement that the Agency protect, secure, perfect, or insure any security
interest or lien in or on any property subject thereto;
(g) Any requirement that the Agency exhaust any right or take any action against
Borrower or any other person or collateral; and
(h) Any defense that may arise by reason of:
(1) The incapacity, lack of authority, death or disability of, or revocation
hereof by, any person or persons;
(2) The failure of the Agency to file or enforce any claim against the estate (in
probate, bankruptcy, or any other proceedings) of any person or persons; or
(3) Any defense based upon an election of remedies by the Agency including,
without limitation, an election to proceed by nonjudicial foreclosure or which
destroys or otherwise impairs the subrogation rights of Borrower or any other
right of Borrower to proceed against a guarantor by the operation of Section 580d
of the California Code of Civil Procedure or otherwise.
5. NOTICES
Any notice, demand, statement, request, or consent made hereunder shall be in writing
and shall be personally served, mailed by first-class registered mail, return receipt requested, to
the address set forth in the first paragraph of this Indemnity, above, or given by electronic
facsimile (“fax”) transmission to the fax numbers stated below, with confirmations mailed by
first class registered mail, return receipt requested to the address set forth above, of the party to
whom such notice is to be given (or to such other address as the parties hereto, shall designate in
writing):
In the case of the Agency: [insert fax]
In the case of Borrower: [insert fax]
Any notice that is transmitted by fax transmission followed by delivery of a “hard” copy, shall be
deemed delivered upon its transmission; any notice that is personally delivered (including by
means of professional messenger service, courier service such as United Parcel Service or
Federal Express, or by U.S. Postal Service), shall be deemed received on the documented date of
receipt; and any notice that is sent by registered or certified mail, postage prepaid, return receipt
required shall be deemed received on the date of receipt thereof.
6. MISCELLANEOUS
6.1 Borrower shall make any payment required to be made hereunder in lawful
money of the United States of America, and in same day funds, to the Agency, as applicable, at
its address specified in the first paragraph hereof.
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6.2 No amendment of any provision of this Indemnity shall be effective unless it is in
writing and signed by Borrower and the Agency, and no waiver of any provision of this
Indemnity, and no consent to any departure by Borrower from any provision of this Indemnity,
shall be effective unless it is in writing and signed by the Agency, and then such waiver or
consent shall be effective only in the specific instance and for the specific purpose for which
given.
6.3 No failure on the part of the Agency to exercise, and no delay in exercising, any
right hereunder or under any Loan Document shall operate as a waiver hereof or thereof, nor
shall any single or partial exercise of any right preclude any other or further exercise thereof or
the exercise of any other right. The rights and remedies of the Agency provided herein and in the
Loan Documents are cumulative and are in addition to, and not exclusive of, any rights or
remedies provided by law. The rights of the Agency hereunder or under any Loan Document
against any party thereto are not conditional or contingent on any attempt by the Agency to
exercise any of its rights hereunder or under any other Loan Document against such party or
against any other person or collateral.
6.4 If any provision of this Indemnity shall be determined by a court of competent
jurisdiction to be invalid, illegal or unenforceable, then that provision shall, as to such
jurisdiction, be deemed ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining portions hereof and without affecting the validity or enforceability of
such provision in any other jurisdiction.
6.5 This Indemnity shall (a) be binding upon Borrower, and Borrower’s successors
and assigns; and (b) inure, together with all rights and remedies of the Agency hereunder, to the
benefit of the Agency, its directors, officers, employees, and agents, any successors to the
Agency’s interest in the Property, any other person who acquires any portion of the Property at a
foreclosure sale or otherwise through the exercise of the Agency’s rights and remedies under the
Loan Documents, any successors to any such person, and all directors, officers, employees, and
agents of all of the aforementioned parties. Without limiting the generality of clause (b) of the
immediately preceding sentence, the Agency may, subject to, and in accordance with, the
provisions of the Loan Documents, assign or otherwise transfer all or any portion of its rights
and obligations under any Loan Document, to any other person, and such other person shall
thereupon become vested with all of the rights and obligations in respect thereof that were
granted to the Agency herein or otherwise. None of the rights or obligations of Borrower
hereunder may be assigned or otherwise transferred without the prior written consent of the
Agency.
6.6 Borrower hereby (a) irrevocably submits to the jurisdiction of any California or
federal court sitting, in each instance, in Los Angeles County in any action or proceeding arising
out of or relating to this Indemnity, (b) waives any defense based on doctrines of venue or forum
non conveniens or similar rules or doctrines, and (c) irrevocably agrees that all claims in respect
of any such action or proceeding may be heard and determined in such California or federal
court. Borrower irrevocably consents to the service of any and all process which may be required
or permitted in any such action or proceeding to the address specified in the first paragraph of
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this Indemnity or in any other manner provided by law. Borrower agrees that a final judgment in
any such action or proceeding shall be conclusive and may be enforced in any other jurisdiction
by suit on the judgment or in any other manner provided by law.
6.7 The title of this document and the captions used herein are inserted only as a
matter of convenience and for reference and shall in no way define, limit, or describe the scope
or the intent of this Indemnity or any of the provisions hereof.
6.8 This Indemnity shall be governed by, and construed and interpreted in accordance
with, the internal laws of the State of California applicable to contracts made and to be
performed therein without regard to the principles regarding conflicts of law, except to the extent
that the laws of the United States preempt the laws of the State of California.
6.9 This Indemnity may be executed in any number of counterparts, each of which
shall constitute an original and all of which together shall constitute one agreement.
IN WITNESS WHEREOF, Borrower has duly executed this Indemnity as of the date set
forth below.
TILDEN TERRACE, L.P.,
a California limited partnership
By: Los Angeles Housing Partnership, Inc.,
a California nonprofit public benefit corporation
Its: Managing General Partner
By: _________________________
Mary Silverstein
Its: President and Executive Director
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EXHIBIT A – LEGAL DESCRIPTION
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EXHIBIT A
LEGAL DESCRIPTION
The real property referred to herein is situated in the State of California, County of Los Angeles,
and described as follows:
LOTS 1 AND 2 OF TRACT NO. 9648, IN THE CITY OF CULVER CITY COUNTY OF LOS
ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 142, PAGES
13, 14 AND 15 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID
COUNTY
And
LOT 3 OF TRACT 9648, AS SHOWN ON A MAP RECORDED IN BOOK 142, PAGES 13,
INCLUSIVE OF MISCELLANEOUS MAPS, RECORDS OF LOS ANGELES COUNTY,
CALIFORNIA
And
LOTS 4, 5, 6, 7 AND 8 OF TRACT NO. 9648, IN THE CITY OF CULVER CITY, COUNTY
OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 142,
PAGES(S) 13 TO 15 INCLUSIVE OF MAPS, IN THE OFFICE OF THE COUNTY
RECORDER OF SAID COUNTY.
APN: 4213-007-001, 4213-007-901, 4213-007-900
ATTACHMENT 3
236B. SEND ACKNOWLEDGMENT TO: (Name and Address)
FILING OFFICE COPY — NATIONAL UCC FINANCING STATEMENT (FORM UCC1) (REV. 07/29/98)
THE ABOVE SPACE IS FOR FILING OFFICE USE ONLY
UCC FINANCING STATEMENT
FOLLOW INSTRUCTIONS (front and back) CAREFULLY
A. NAME & PHONE OF CONTACT AT FILER [optional]
1. DEBTOR'S EXACT FULL LEGAL NAME - insert only one debtor name (1a or 1b) - do not abbreviate or combine names
4. This FINANCING STATEMENT covers the following collateral:
COUNTRY
5. ALTERNATIVE DESIGNATION [if applicable]: NON-UCC FILING AG. LIEN SELLER/BUYER BAILEE/BAILOR CONSIGNEE/CONSIGNOR LESSEE/LESSOR
This FINANCING STATEMENT is to be filed [for record] (or recorded) in the REAL
ESTATE RECORDS. Attach Addendum
6.
All Debtors Debtor 1 Debtor 2
Check to REQUEST SEARCH REPORT(S) on Debtor(s)
[ADDITIONAL FEE]
7.
[if applicable] [optional]
OR
SUFFIX
POSTAL CODE CITY
FIRST NAME
2c. MAILING ADDRESS
OR
OR
2d. TAX ID #: SSN OR EIN ADD'L INFO RE
ORGANIZATION
DEBTOR
2e. TYPE OF ORGANIZATION 2f. JURISDICTION OF ORGANIZATION
3b. INDIVIDUAL'S LAST NAME FIRST NAME
POSTAL CODE 3c. MAILING ADDRESS
1a. ORGANIZATION'S NAME
2b. INDIVIDUAL'S LAST NAME
CITY
MIDDLE NAME
STATE
2g. ORGANIZATIONAL ID #, if any
MIDDLE NAME
STATE
SUFFIX
COUNTRY
1d. TAX ID #: SSN OR EIN
2. ADDITIONAL DEBTOR'S EXACT FULL LEGAL NAME - insert only one debtor name (2a or 2b) - do not abbreviate or combine names
POSTAL CODE CITY 1c. MAILING ADDRESS
ADD'L INFO RE
ORGANIZATION
DEBTOR
1e. TYPE OF ORGANIZATION 1f. JURISDICTION OF ORGANIZATION
NONE
1b. INDIVIDUAL'S LAST NAME
2a. ORGANIZATION'S NAME
FIRST NAME MIDDLE NAME
STATE
1g. ORGANIZATIONAL ID #, if any
SUFFIX
COUNTRY
NONE
3a. ORGANIZATION'S NAME
3. SECURED PARTY'S NAME (or NAME of TOTAL ASSIGNEE of ASSIGNOR S/P) - insert only one secured party name (3a or 3b)
8. OPTIONAL FILER REFERENCE DATA
ATTACHMENT 3
237
UCC-1 ATTACHMENT
EXHIBIT A – LEGAL DESCRIPTION
19 UCC1 ATTACHMENT [3/17/2011]
EXHIBIT “A”
LEGAL DESCRIPTION
All of the following real property in the City of Culver City, Los Angeles County, State of
California (the “Property”):
LOTS 1 AND 2 OF TRACT NO. 9648, IN THE CITY OF CULVER CITY COUNTY OF LOS
ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 142, PAGES
13, 14 AND 15 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID
COUNTY
And
LOT 3 OF TRACT 9648, AS SHOWN ON A MAP RECORDED IN BOOK 142, PAGES 13,
INCLUSIVE OF MISCELLANEOUS MAPS, RECORDS OF LOS ANGELES COUNTY,
CALIFORNIA
And
LOTS 4, 5, 6, 7 AND 8 OF TRACT NO. 9648, IN THE CITY OF CULVER CITY, COUNTY
OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 142,
PAGES(S) 13 TO 15 INCLUSIVE OF MAPS, IN THE OFFICE OF THE COUNTY
RECORDER OF SAID COUNTY.
APN: 4213-007-001, 4213-007-901, 4213-007-900
ATTACHMENT 3
238
UCC-1 ATTACHMENT
SCHEDULE A – COLLATERAL DESCRIPTION
19 UCC1 ATTACHMENT [3/17/2011]
SCHEDULE “A”
Item 4. Collateral Description
All buildings, structures and improvements of every nature whatsoever now or hereafter situated
on the Property; and
Together with the rents, issues and profits thereof; and together with all buildings and
improvements of every kind and description now or hereafter erected or placed thereon, and all
fixtures, including but not limited to all gas and electric fixtures, engines and machinery,
radiators, heaters, furnaces, heating equipment, laundry equipment, steam and hot-water boilers,
stoves, ranges, elevators and motors, bathtubs, sinks, water closets, basins, pipes, faucets and
other plumbing and heating fixtures, mantles, cabinets, refrigerating plant and refrigerators,
whether mechanical or otherwise, cooking apparatus and appurtenances, and all shades, awnings,
screens, blinds and other furnishings, it being hereby agreed that all such fixtures and furnishings
shall to the extent permitted by law be deemed to be permanently affixed to and a part of the
realty; and
Together with all building materials and equipment now or hereafter delivered to said premises
and intended to be installed therein; and
Together with all plans, drawings, specifications, etc., and articles of personal property now or
hereafter attached to or used in and about the building or buildings now erected or hereafter to be
erected on the Property which are necessary to the completion and comfortable use and
occupancy of such building or buildings for the purposes for which they were or are to be
erected, including all other goods and chattels and personal property as are ever used or
furnished in operating a building, or the activities conducted therein, similar to the one herein
described and referred to, and all renewals or replacements thereof or articles in substitution
therefor, whether or not the same are, or shall be attached to said building or buildings in any
manner.
ATTACHMENT 3
239
NOTICE OF AFFORDABILITY RESTRICTIONS
PAGE 1
Tilden Terrace
20 Notice of Affordability Restrictions v2
EXHIBIT NO. 17
FORM OF NOTICE OF RESTRICTIONS
When Recorded Return to:
CULVER CITY REDEVELOPMENT
9770 Culver Boulevard
Culver City, California 90232-0507
Attn: John Fisanotti,
Redevelopment Project Manager
SPACE ABOVE THIS LINE FOR RECORDING USE
OFFICIAL BUSINESS
Document Entitled to Free Recording
Per Government Code §27383
Parcel Number: 4213-007-001, 4213-007-901, 4213-007-900
NOTICE OF AFFORDABILITY RESTRICTIONS ON TRANSFER OF
PROPERTY
NOTICE IS HEREBY GIVEN that pursuant to Health & Safety Code
Section 33334.3(f) as amended effective January 1, 2008, the Culver City
Redevelopment Agency is recording this Notice of Affordability Restrictions on
Transfer of Property (hereinafter the “Notice”) with regard to the property located
at 11042-11056 West Washington Boulevard, Culver City, California and more
particularly described in Exhibit “A” attached hereto (the “Property”).
The Property is subject to the Agreement Containing Covenants Affecting
Real Property (Including Affordable Housing Restrictions) (the “Agreement
Containing Covenants”) recorded concurrently herewith, which restricts the use of
the Property as follows:
(1) two (2) one-bedroom, seven (7) two-bedroom and five
(5) three-bedroom units shall be rented exclusively Very Low Income
ATTACHMENT 3
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NOTICE OF AFFORDABILITY RESTRICTIONS
PAGE 2
Tilden Terrace
20 Notice of Affordability Restrictions v2
Households at an Affordable Rent as provided in California Health
and Safety Code Section 50053.
(2) four (4) two-bedroom and two (2) three-bedroom units
shall be rented exclusively to Low Income households at an
Affordable Rent as provided in California Health and Safety Code
Section 50053.
(3) seven (7) two-bedroom and five (5) three-bedroom units
shall be rented exclusively to Moderate Income households at an
Affordable Rent as provided in California Health and Safety Code
Section 50053.
The maximum incomes of eligible tenants shall be determined on the
basis of the income limits for Very Low Income, Low Income and
Moderate Income households in Los Angeles County, published
approximately annually by the California Department of Housing and
Community Development (“HCD”). If HCD discontinues publishing
such income limits, the term “Very Low Income” shall mean a
household income that does not exceed 50% of the area median
income, adjusted for family size, the term “Low Income” shall mean a
household income that does not exceed 80% of the area median
income, adjusted for family size and the term “Moderate Income”
shall mean a household income that does not exceed 120% of the area
median income, adjusted for family size.
Any rents charged to a tenant shall not exceed rents that are affordable
to Very Low Income, Low Income and Moderate Income Households,
as applicable. The maximum rents, including a reasonable utility
allowance for utilities and services (excluding telephone) to be paid
by Very Low Income, Low Income and Moderate Income Households
are as follows:
(i) In the case of any Low Income Household, the maximum
rent shall be a rent that does not exceed 30 percent of fifty percent
(50%) of the area median income adjusted for household size
appropriate to the unit, as determined by the California Department of
Housing and Community Development.
ATTACHMENT 3
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NOTICE OF AFFORDABILITY RESTRICTIONS
PAGE 3
Tilden Terrace
20 Notice of Affordability Restrictions v2
(ii) In the case of any Low Income Household, the maximum
rent shall be a rent that does not exceed 30 percent of sixty percent
(60%) of the area median income adjusted for household size
appropriate to the unit, as determined by the California Department of
Housing and Community Development.
(iii) In the case of any Moderate Income Household, the
maximum rent shall be a rent that does not exceed 30 percent of one
hundred ten percent (110%) of the area median income adjusted for
household size appropriate to the unit, as determined by the California
Department of Housing and Community Development.
The affordability restrictions imposed on the Site by the Regulatory
Agreement are scheduled to expire on the date that is fifty-five (55) years after the
recordation of the Release of Construction Covenants for the construction of the
Improvements on the Property.
[Remainder of Page Intentionally Left Blank; Signatures on Following Pages]
ATTACHMENT 3
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NOTICE OF AFFORDABILITY RESTRICTIONS
PAGE 4
Tilden Terrace
20 Notice of Affordability Restrictions v2
This Notice is recorded for the purpose of providing notice only and in no
way modifies the provisions of the Agreement Containing Covenants.
“AGENCY”
CULVER CITY REDEVELOPMENT
AGENCY, a public body, corporate and
politic
_____________________________
John M. Nachbar
Executive Director
ATTEST:
_____________________________
Agency Secretary
APPROVED AS TO FORM:
_____________________________
General Counsel
_______________________________
KANE, BALLMER & BERKMAN
Agency Special Counsel
ATTACHMENT 3
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ASSIGNMENT OF AGREEMENTS
CONSENT TO RECORDATION
Tilden Terrace
20 Notice of Affordability Restrictions v2
CONSENT TO RECORDATION
TILDEN TERRACE, L.P. (“Owner”), owner of the fee interest in the real
property legally described in Exhibit “A” hereto, hereby consents to the
recordation of the foregoing Notice of Affordability Restrictions on Transfer
of Property against said real property.
TILDEN TERRACE, L.P.,
a California limited partnership
By: Los Angeles Housing Partnership, Inc.,
a California nonprofit public benefit corporation
Its: Managing General Partner
By: _________________________
Mary Silverstein
Its: President and Executive Director
ATTACHMENT 3
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State of California )
County of Los Angeles )
On ________________________________________ before me, __________________,
a Notary Public, personally appeared ______________________________, who proved to me
on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature_______________________________________ (Seal)
State of California )
County of Los Angeles )
On ________________________________________ before me, __________________,
a Notary Public, personally appeared ______________________________, who proved to me
on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature_______________________________________ (Seal)
ATTACHMENT 3
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Exhibit “A”
The land referred to herein is situated in the State of California, County of Los
Angeles, and described as follows:
LOTS 1 AND 2 OF TRACT NO. 9648, IN THE CITY OF CULVER CITY
COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP
RECORDED IN BOOK 142, PAGES 13, 14 AND 15 OF MAPS, IN THE
OFFICE OF THE COUNTY RECORDER OF SAID COUNTY
And
LOT 3 OF TRACT 9648, AS SHOWN ON A MAP RECORDED IN BOOK 142,
PAGES 13, INCLUSIVE OF MISCELLANEOUS MAPS, RECORDS OF LOS
ANGELES COUNTY, CALIFORNIA
And
LOTS 4, 5, 6, 7 AND 8 OF TRACT NO. 9648, IN THE CITY OF CULVER
CITY, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP
RECORDED IN BOOK 142, PAGES(S) 13 TO 15 INCLUSIVE OF MAPS, IN
THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
APN: 4213-007-001, 4213-007-901, 4213-007-900
ATTACHMENT 3
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RELEASE OF CONSTRUCTION COVENANTS
PAGE 1
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21 Release of Construction Covenants v2
EXHIBIT NO. 18
FORM OF RELEASE OF CONSTRUCTION COVENANTS
When Recorded Return to:
CULVER CITY REDEVELOPMENT
9770 Culver Boulevard
Culver City, California 90232-0507
Attn: John Fisanotti,
Redevelopment Project Manager
SPACE ABOVE THIS LINE FOR RECORDING USE
Parcel Number: 4213-007-001, 4213-007-901, 4213-007-900 OFFICIAL BUSINESS
Document Entitled to Free Recording
Per Government Code §27383
RELEASE OF CONSTRUCTION COVENANTS BY THE CULVER CITY
REDEVELOPMENT AGENCY TO TILDEN TERRACE, L.P.
WHEREAS, TILDEN TERRACE, L.P., a California limited partnership (the
“Developer”) is the owner of that certain real property situated in the City of Culver City,
California described in Exhibit “A” which is attached hereto and made a part hereof (the
“Property”), and has agreed to construct the improvements thereon (the “Improvements”); and
WHEREAS, the Agreement Containing Covenants Affecting Real Property (Including
Affordable Housing Restrictions) entered into by and between the Culver City Redevelopment
Agency (the “Agency”) and the Developer and recorded in the Official Records of Los Angeles
County, California on _______________, 2011 as Instrument No. __________ (the “Agreement
Containing Covenants”) obligates the Developer and its successors or assigns to construct the
Improvements in accordance with the Disposition and Development Agreement (“DDA”) dated
as of March 21, 2011 by and between the Agency and the Developer.
WHEREAS, pursuant to the DDA, the Agency has agreed to furnish the Developer with a
Release of Construction Covenants (“Release”) upon the completion of the construction of the
Improvements, and such certificate is to be in such form as to permit it to be recorded in the
Official Records of Los Angeles County; and
WHEREAS, the DDA states that the Release shall be conclusive determination of
satisfactory completion of the construction of the Improvements as required by the DDA; and
ATTACHMENT 3
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RELEASE OF CONSTRUCTION COVENANTS
PAGE 2
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21 Release of Construction Covenants v2
WHEREAS, the Agency has determined that the construction of the Improvements on the
Property as required by the DDA has been satisfactorily completed by Developer.
NOW THEREFORE, it is hereby acknowledged and agreed by the parties hereto that:
1. The Agency hereby certifies that the construction of the Improvements on the
Property has been fully and satisfactorily performed and completed as required by the DDA and
the Agreement Containing Covenants.
2. Nothing contained in this instrument shall modify any provisions of the DDA or
the Agreement Containing Covenants.
3. This Release shall constitute a conclusive determination of satisfaction of the
agreements and covenants contained in the DDA requiring the Developer, and its successors and
assigns, to construct the improvements and the dates for the beginning and completion thereof.
“AGENCY”
CULVER CITY REDEVELOPMENT AGENCY, a
public body corporate and politic
Date: _____________________ By: _________________________________
Executive Director
ATTEST:
By: _________________________________
Agency Secretary
APPROVED AS TO FORM:
By: _________________________________
General Counsel
By: _________________________________
KANE, BALLMER & BERKMAN
Agency Special Counsel
ATTACHMENT 3
248
RELEASE OF CONSTRUCTION COVENANTS
LEGAL DESCRIPTION
Tilden Terrace
21 Release of Construction Covenants v2
EXHIBIT A
LEGAL DESCRIPTION OF SITE
The land referred to herein is situated in the State of California, County of Los Angeles, and
described as follows:
LOTS 1 AND 2 OF TRACT NO. 9648, IN THE CITY OF CULVER CITY COUNTY OF LOS
ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 142, PAGES
13, 14 AND 15 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID
COUNTY
And
LOT 3 OF TRACT 9648, AS SHOWN ON A MAP RECORDED IN BOOK 142, PAGES 13,
INCLUSIVE OF MISCELLANEOUS MAPS, RECORDS OF LOS ANGELES COUNTY,
CALIFORNIA
And
LOTS 4, 5, 6, 7 AND 8 OF TRACT NO. 9648, IN THE CITY OF CULVER CITY, COUNTY
OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 142,
PAGES(S) 13 TO 15 INCLUSIVE OF MAPS, IN THE OFFICE OF THE COUNTY
RECORDER OF SAID COUNTY.
APN: 4213-007-001, 4213-007-901, 4213-007-900
ATTACHMENT 3
249
State of California )
County of Los Angeles )
On ________________________________________ before me, __________________,
a Notary Public, personally appeared ______________________________, who proved to me
on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature_______________________________________ (Seal)
State of California )
County of Los Angeles )
On ________________________________________ before me, __________________,
a Notary Public, personally appeared ______________________________, who proved to me
on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature_______________________________________ (Seal)
ATTACHMENT 3
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RESOLUTION NO. 2011-A
A RESOLUTION OF THE CULVER CITY REDEVELOPMENT
AGENCY APPROVING A DISPOSITION AND DEVELOPMENT
AGREEMENT WITH TILDEN TERRACE, L.P. AND THE CITY OF
CULVER CITY AND MAKING CERTAIN FINDINGS AND
DETERMINATIONS RELATING THERETO
WHEREAS, the City Council of the City of Culver City (the “City Council”)
adopted the Redevelopment Plan for the Culver City Redevelopment Project Area (the
“Project Area”) by Ordinance No. 98-014 on November 23, 1998, amended pursuant to
Ordinance No. 98-015 on November 23, 1998 to add Component Area No. 4, as further
amended from time to time (the “Redevelopment Plan”); and
WHEREAS, the Culver City Redevelopment Agency (the “Agency”) is
engaged in activities to carry out the redevelopment of the Project Area for the purpose
of, among other things, increasing the community’s supply of affordable housing for low
and moderate income households and for commercial revitalization; and
WHEREAS, the Agency acquired certain real property in the Project Area,
located at 11054-11056 West Washington Boulevard (the “Agency Parcel”) for the
purpose of affordable housing and commercial revitalization of the Project Area; and
WHEREAS, in December 2010 the Agency entered into an Exclusive
Negotiation Agreement with Los Angeles Housing Partnership, Inc., a California non-
profit public benefit corporation (“LAHP”) relating to the development of the Agency
Parcel and the adjacent parcel owned by LAHP located at 11042-11052 West
Washington Boulevard (the “Developer Parcel” and collectively with the Agency Parcel,
the “Site”) with thirty-three (33) units of affordable rental housing for very low, low and
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moderate income households and approximately 10,700 square feet of ground floor
retail, office, and community space (the “Project”); and
WHEREAS, Sections 33334.2 and 33334.3 of California’s Community
Redevelopment Law [Health & Safety Code §§33000, et seq.] (the “CRL”) require the
Agency to use 20 percent of taxes allocated to the Agency pursuant to Section 33670 of
the CRL for the purpose of increasing, improving, and preserving the community’s
supply of low and moderate income housing (“Low and Moderate Income Housing
Fund”); and
WHEREAS, the Agency and Tilden Terrace, L.P., a California limited
partnership (the “Developer”), whose managing general partner is LAHP, entered into
that certain Option Agreement dated March 8, 2011 (the “Developer Option”), whereby
the Agency granted an option to Developer to acquire the Agency Parcel for
development of the Project; and
WHEREAS, the Agency issued a loan commitment to Developer on March
8, 2011 (the “Commitment Letter”) for a loan from the Agency to Developer for payment
of certain costs of acquiring the Site and developing the Project, a portion of which is to
be funded with Low and Moderate Income Housing Funds; and
WHEREAS, the Agency and the City of Culver City (the “City”) entered
into a Cooperation Agreement dated January 15, 2011, whereby the City agreed to,
among other things, aid and cooperate with the Agency in carrying out the Project and
the Agency agreed to, among other things, pay the City’s costs of carrying out the
Project; and
WHEREAS, in furtherance of the Cooperation Agreement and for
important public purposes, the Agency transferred to the City certain of the Agency’s
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assets, including the Agency Parcel and cash funds held by the Agency (the
“Redevelopment and Housing Funds”) and assigned to the City the Commitment Letter
and the Developer Option; and
WHEREAS, the Agency and its successors and assigns, whether
voluntary or involuntary successors, or whether successors by operation of law, remains
obligated to the Developer under the Commitment Letter and the Purchase Option and
in furtherance of the Agency’s performance of its obligations under the Commitment
Letter and the Purchase Option, the Agency wishes to enter into a Disposition and
Development Agreement with the Developer and the City (the “DDA”) to set forth the
additional terms and conditions under which the Agency will convey the Agency Parcel
to the Developer and loan the Redevelopment and Housing Funds to the Developer to
carry out the Project; and
WHEREAS, the Cooperation Agreement and the DDA provide for the
Agency to pay certain costs of streetscape and intersection improvements included in
the Project (the “Off-Sites”) and Section 33445 of the CRL provides that the Agency
may pay the cost of publicly owned improvements if certain findings are made by the
Agency and the City Council; and
WHEREAS, in Resolution No. 2011-A001, adopted on January 15, 2011
in connection with the Redevelopment Agency Board’s approval of the Cooperation
Agreement, the Redevelopment Agency Board found and determined that the Agency’s
payment of the cost of the Off-Sites (which were included in the activities described in
the Cooperation Agreement) is of benefit to the Project Area by helping to eliminate
blight within the Project Area or providing housing for low- or moderate income persons,
no other reasonable means of financing the Off-Sites are available to the community,
and the payment of funds by the Agency for the costs related to the Off-Sites is
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consistent with the Implementation Plan adopted pursuant to Section 33490 of the CRL;
and
WHEREAS, Section 33433 of the CRL requires the Agency to make
available for public inspection a copy of the proposed sale of the Agency Parcel to the
Developer and a summary report (the “Summary Report”) describing the cost of the
DDA to the Agency, the estimated value of the interest to be conveyed determined at
highest and best use, the estimated value of the interest to be conveyed determined at
the use and with the conditions, covenants, and development costs required by the
DDA, and an explanation of why the conveyance of the Agency Parcel to the Developer
will assist in the elimination of blight or provide housing for low- and moderate-income
households; and
WHEREAS, the proposed DDA and the Summary Report have been
made available for public inspection, a duly noticed public hearing has been held
pursuant to Section 33431 of the CRL, and the City Council has made certain findings
and has approved the sale of the Agency Parcel to the Developer as required by
Section 33433 of the CRL; and
WHEREAS, the Developer has submitted to the Redevelopment Agency
Board and the City Council copies of the proposed DDA in a form desired by the
Developer; and
WHEREAS, on March 15, 2011, the Planning Commission of the City of
Culver City adopted Resolution No. 2011-P003 adopting a Mitigated Negative
Declaration (“MND”) in connection with Site Plan Review SPR P-2011012 for the
Project.
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NOW, THEREFORE, BE IT HEREBY RESOLVED by the Culver City
Redevelopment Agency Board, as follows:
1. The above recitals are true and correct.
2. The Redevelopment Agency Board has received and heard all oral
and written objections to the DDA and to other matters pertaining to this
transaction and all such oral and written objections are hereby overruled.
3. Based upon all of the evidence in the record, the Redevelopment
Agency Board hereby finds and determines that the proposed sale of the Agency
Parcel to the Developer will assist in the elimination of blight and will provide
housing for low and moderate income persons, is consistent with the
Implementation Plan for the Project Area, and the consideration for the Agency
Parcel is not less than the fair reuse value at the use and with the covenants and
conditions and development costs authorized by the DDA.
4. Based upon all of the evidence in the record, the Redevelopment
Agency Board hereby confirms and restates its findings in Resolution No. 2011-
A001 dated January 15, 2011 with respect to the Off-Sites, that:
(a) The Off-Sites are of benefit to the Project Area by
helping to eliminate blight within the Project Area or providing housing for low- or
moderate income persons; and
(b) No other reasonable means of financing the Off-Sites
are available to the community; and
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(c) The payment of funds by the Agency for the costs
related to the Off-Sites is consistent with the Implementation Plan adopted
pursuant to Section 33490 of the CRL.
5. The Redevelopment Agency Board has duly considered the terms
and conditions of the proposed transaction and all comments received at the
public hearing, and determines that the proposed DDA is in the best interests of
the City and the Project Area and the health, safety, morals and welfare of its
residents, and in accord with the public purposes and provisions of applicable
State and local law and requirements.
6. The Redevelopment Agency Board has considered the Initial Study
for the Project and finds that the Initial Study and the MND were prepared in
compliance with the California Environmental Quality Act, have been reviewed
and considered by the Redevelopment Agency Board, and reflect the
independent judgment of the Redevelopment Agency Board, and, based on the
entire record of proceedings, the proposed Project is consistent with the Initial
Study and there is no substantial evidence that the proposed Project will have a
significant effect on the environment.
7. In furtherance of the Commitment Letter, the Redevelopment
Agency Board hereby approves a loan to the Developer pursuant to the DDA to
pay Project costs in an amount not to exceed $15,200,000, of which an amount
not to exceed $11,805,000 will be a loan of Low and Moderate Income Housing
Funds.
8. In furtherance of the Commitment Letter and the Developer
Option, the Redevelopment Agency Board hereby approves the proposed
ATTACHMENT 4
256
7|101010101010101010 10
10|11
12
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17
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Disposition and Development Agreement, a copy of which is on file in the office
of the Secretary of the Agency, in substantially the form presented at this
meeting, with such non-substantive changes as may be approved by the
Executive Director of the Agency with approval as to form by Agency General
Counsel.
9. The Executive Director or written designee is hereby authorized to
take all reasonable and necessary actions and sign on behalf of the Agency all
reasonable and necessary documents and instruments first approved in writing
by the Agency General Counsel to implement and carry out the Project pursuant
to the DDA.
10. This Resolution shall take effect immediately upon its adoption.
APPROVED AND ADOPTED, this 21st day of March, 2011.
MICHEAL O’LEARY, CHAIR
Culver City Redevelopment Agency
ATTEST: APPROVED AS TO FORM:
ALICE PRASAD, Secretary MURRAY KANE, Agency General Counsel
A11-00140
ATTACHMENT 4
257Year
Affordable Housing
Units Produced
Units Produced
Multi-Family 2-4 Units
Units Produced
Multi-Family 5 + Units
2000 0 0 0
2001 0 0 6
2002 0 0 0
2003 0 0 0
2004 0 3 0
2005 0 4 0
2006
23
Grandview Palms
Assisted Living for
Seniors/Disabled 4061
Grandview
0 0
2007 0 8 0
2008 0 4 8
2009 0 4 15
2010 0 11 18
Total 23 34 47
HOUSING CITY HOUSING AGENCY
AFFORDABLE HOUSING PRODUCTION
2000-2009
D
Culver City Housing Division
Pathway to Home
Note: Total number of market-rate units produced over ten years = 81; divided by 10 = 8.1 per year|1010|ATTACHMENT 5
258 City of Culver City, California
Planning Commission Agenda Item Report
Page 1 of 16
RECOMMENDATION:
That the Planning Commission:
1. Adopt a Mitigated Negative Declaration (MND) based on the Initial Study
finding that the project will not have a significant adverse impact on the
environment (Attachment No. 3); and
2. Approve Site Plan Review, SPR P-2011012, Administrative Modification, AM
P-2011014, and Recommend Approval to the City Council of Density and
Other Bonus Incentives, DOBI P-2011015, subject to the Conditions of
Approval as stated in Resolution No. 2011-P003 (Attachment No. 7); and
NOTE: Due to a technical error in the posting of the Notice of Intent to Adopt the
MND, the public review period for the MND had to be extended and does not end
until March 15, 2011. Therefore, the Commission will not be able to adopt the
MND at this meeting and cannot take formal action on the entitlements until the
end of the CEQA comment period. As such, staff is recommending that the
Commission proceed as noted below and after conducting the public hearing on
this item continue the item to March 15, 2011 for adoption of the MND and
adoption of the resolution approving the Site Plan Review and Administrative
Modification and the resolution recommending approval to the City Council of the
Density and Other Bonus Incentives.
Meeting Date: March 3, 2011 Item Number: PH-1
AGENDA ITEM: Site Plan Review, Administrative Modification, and Density and
Other Bonus Incentives to allow the development of a 3-story mixed use building
with 10,700 square feet of commercial space and 33 residential units located at
11042-11056 Washington Boulevard.
Contact Person/Dept.: Susan Yun, Senior
Planner
Phone Number: (310) 253-5755 /
Public Hearing: [X] Action Item: [] Attachments: [X]
Public Notification: On February 10, 2010, a notice (approximately 1,900 recipients)
was mailed to all the property owners and occupants beyond a 500-foot radius of the
site, posted on the site and emailed to the Master Notification List.
Planning Approval:
Thomas Gorham, Planning Manager
Department Approval:
Sol Blumenfeld, Community Development
Director
ATTACHMENT 6
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Page 2 of 16
PROCEDURES:
1. Chair calls on staff for a staff report and Commission poses questions to staff
as desired.
2. Chair opens the public hearing, providing the applicant the first opportunity to
speak, followed by the general public.
3. Chair seeks a motion to close the public hearing after all testimony has been
presented.
4. Commission discusses the matter and arrives at its decision
5. Commission continues the item to March 15, 2011 for adoption of the MND
and the resolutions.
BACKGROUND:
The proposed entitlement request is a Site Plan Review (SPR), to allow the
development of a three story mixed use residential building with one level of
subterranean parking; an Administrative Modification (AM) to reduce the parking
drive aisle width; and a Density and Other Bonus Incentive (DOBI) to allow for an
increase in the base residential unit density in exchange for the provision of
affordable housing consistent with State law.
The proposed project is the product of efforts by the Redevelopment Agency and
the City to redevelop this area of Washington Boulevard with a high quality
development that promotes commercial revitalization as well as provision of
affordable housing in accordance with the Redevelopment Agency’s
Comprehensive Housing Strategy and the City’s 2008-2014 General Plan
Housing Element.
The Redevelopment Agency (the Agency) acquired the blighted Pleasant View
convalescent facility (11056 Washington Blvd.) and the Arco Electric Company
(11054 Washington Blvd.) in 2007 for demolition and redevelopment. The
adjacent commercial building is vacant and will be incorporated in the project.
The Agency commenced negotiations with the developer, Los Angeles Housing
Partnership (LAHP) in 2010 to redevelop the Agency’s site as well as the
adjoining properties subject to the terms and conditions of an Agency and
developer Disposition and Development Agreement (DDA) to be considered
upon completion of project entitlements.
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The Agency’s expectation is to develop a place-making project that promotes
area redevelopment and revitalization. Toward that end, staff has worked
diligently over the last four months with the project developer and the community
to incorporate design and revitalization programming that enhances the street
and is fitting with the adjacent residential neighborhood. The project is designed
as a high quality mixed used development with ample plazas and setbacks to
provide opportunities for outdoor dining and landscaping. The retail component
is considered as important to the project as the residential component and is
designed to communicate effectively with the street and sidewalks. The retail
spaces will include design features that help ensure quality retail tenants with
attractive storefronts and signage. The materials, colors and textures of the
building are intended to evoke quality and permanence. The building finishes
include corten steel, wood and an abundant use of glass. The building includes
step backs and setbacks to create an attractive building form and provide visual
interest. Clerestory windows are used to provide light to the residential units and
common areas. The Agency has also programmed funds to improve the public
spaces with new street furniture, crosswalks and landscaping and will provide a
commercial rehabilitation program for some of the adjacent commercial
properties.
General Information
See Attachment No. 1, Project Summary
Existing Conditions
The project site, approximately 32,279 square feet in area, is located at 11042-
11056 Washington Boulevard on three contiguous parcels which span the south
side of Washington Boulevard, on the block between Tilden Avenue on the east
and Harter Avenue on the west, see Area Map (Attachment No. 2), in the
Commercial General (CG) zone. The rear of the project site is bordered by a 20’
wide public alley. The project site is surrounded by commercial retail uses to the
north, east, and west in the CG zone, and single and two-family residential uses
to the south in the R2 zone.
As noted above, a portion of the project site (11056 Washington Boulevard) that
contained the 8,079 square feet Pleasant View facility was cleared in 2007 and is
currently unpaved and vacant. There is a chain link security fence that surrounds
the perimeter of this portion of the site. The remaining portion of the project site
contains two commercial buildings with paved parking areas at the rear of the
site adjacent to the alley. One of the buildings located at 11042-11052
Washington Boulevard is developed with a single story 6,029 square foot
building that contains small retail stores such as a printer, nail salon and a
ATTACHMENT 6
261 City of Culver City, California
Planning Commission Agenda Item Report
Page 4 of 16
collector’s armory. The middle lot, located at 11054 Washington Boulevard
contains a vacant 3,600 square foot building previously occupied by Arco Electric
Company.
Project Description
The proposed project consists of a 3-story, 35-foot high, mixed use building with
10,700 square feet of ground floor commercial space and a total of 33 residential
units at the second and third levels (48,525 square feet overall). The total units
proposed include a density bonus of 35% as allowed by State law for the
provision of affordable housing within the project. The project will provide a total
of 106 parking spaces (41 surface parking spaces for the commercial visitors,
employees and residential guests and 65 spaces in a one-level subterranean
garage for the residential tenants).
The project will provide a number of on-site amenities for residents including a
700 square foot community/recreational room, a 440 square foot cyber library
computer lab fully equipped for educational use, two large interior central
courtyards totaling 4,440 square feet with benches and tables for passive
recreational activities, a laundry facility on both the second and third floors and a
860 square foot community garden at the roof level.
The project also includes offsite improvements including new sidewalks, street
furniture and street trees and new landscaped medians adjacent to the site as
well as various operational and circulation improvements at the adjacent
intersections of Washington Boulevard including Washington Place, Tilden
Avenue and Harter Avenue.
ANALYSIS:
Site Plan and Architectural Design
The project has been designed to conform to all applicable provisions of the
Mixed Use Ordinance, Commercial General (CG) Zone, and all City development
standards. The building mass and scale is modest compared to the base zoning
height and setback allowances and has been designed to be compatible with the
adjacent residential uses to the south and to provide a pedestrian oriented
streetscape along Washington Boulevard. The building will cover approximately
60 percent of the site, with remainder of the site developed with courtyard open
space, landscaping or areas for parking and vehicular or pedestrian circulation.
The proposed building is well articulated and aesthetically engaging by
incorporating varying building heights, setbacks and design elements. The
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project’s mechanical equipments and refuse containers have been designed to
be concealed from the street, public places and neighboring properties.
Height. The mixed use development standards require a 35 foot height limit for
portions of the building within 35 feet of an R1 or R2 zone with allowance for the
building to go up to 45 feet in height for the building 35 feet or more from the R1
or R2 zone. The proposed building will be 3 stories, with the majority of the
building at 35 feet in height including portions beyond 35 feet from the abutting
residential zone. The corner portion of the building on the northeast side at
Tilden Avenue and Washington Boulevard has a design element comprising of a
clerestory window for the two story cyber library and will be 40 feet in height
which is still under the 45 feet height limit for the portion of the building setback
35 feet or greater from a R1 or R2 zone.
Setback. The building frontage at ground level along Washington Boulevard will
be setback up to 5 feet, as allowed in the City’s mixed use ordinance to
accommodate pedestrian amenities such as landscaped planter areas, seating
niches for tables and benches, and building canopies to provide for an enhanced
pedestrian friendly street edge. The Tilden Avenue corner of the building is
setback up to 15 feet to provide for an enhanced pedestrian plaza area for
utilization by commercial uses at the ground floor. The project accommodates
an additional 3 foot building setback along the rear alley beyond the required 2
feet, for a total setback of 5 feet along the alley to allow the planting of a row of
columnar type trees that will create a significant landscaped buffer between the
project and the residential buildings behind the alley. Further, the project meets
the requirements of the mixed use development standards 60 degree clear zone
setback adjacent to the abutting residential zone resulting in the rear of the
building being stepped back at the second level.
Architectural Design. The proposed project is an architecturally modern building
making use of a variety of building materials including, corten steel, aluminum
framing, glass store fronts, metal awnings, wood railings and stucco. The colors
and materials are neutral and will not conflict with the character of the
neighborhood. The building is well articulated with the use of stepbacks,
overhangs and canopies; private balconies for residential uses on the second
and third floors; substantial use of planter areas on the second floor and open
space/courtyard areas which provide visual interest to all four sides of the
building.
Sustainability/Green Building. An additional feature of the overall site design is
the incorporation of environmentally friendly and energy efficient building design
elements. The proposed project will incorporate building design standards to
meet the U.S. Green Building Council (USGBC’s) Leadership in Energy and
ATTACHMENT 6
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Environmental Design (LEED) green building standards at the Silver certification
level or higher. Sustainable/green building elements include:
• Open Space Courtyards. The project includes two large interior central
courtyards totaling 4,440 square feet at the second floor of the building,
creating an open-air passive recreational area for residents. This courtyard
will be landscaped to satisfy LEED requirements, and will provide shaded
areas equipped with benches and tables.
• Planters. Planters on the second floor are proposed to receive storm water
from the roof, filtering and retaining the water before it is released into the
City’s storm drainage system. The filtration planter consists of a layer of
pebbles and a growth medium over filter fabric and gravel. The planters are
proposed to help purify the water, reduce the amount of water and slow the
rate of water into the storm drain.
• Green Screens. At the back of the building, adjacent to the alley, vines will
be planted along a “green screen” (metal mesh with landscaping) located
behind the 5 foot planter area.
• Rooftop Community Garden. The project also offers an approximately 860
square foot community garden on the rooftop of the building for the residents
that serves as a water reclamation system to irrigate landscaping and to
contribute to sustainable building features, attributable to LEED requirements.
• Solar Power. The project provides photovoltaic solar arrays of approximately
5,000 square feet in area which is estimated to generate 30 Kilowatts of
power. This exceeds the City’s minimum requirement of 4.8 Kilowatts for a
building and project of this size. The solar panels which are elevated from
the roof also provide shade for the roof surface, which in turn, cools the roof
and spaces below.
• Natural Ventilation. Each residential unit will be strategically designed to
maximize day lighting as well as natural ventilation for a comfortable and
healthy quality of life for residents. The rooftop community garden, perimeter
landscaped planters areas, the interior courtyards and green screens are
intended to provide ecological benefits such as cooling and humidifying the
surrounding air, retaining and reducing storm water run-off, and improving the
thermal insulation of the roof itself, thereby mitigating the effects of “urban
heat islands”.
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Mixed Use Requirements. To reinforce the commercial use of the area, the
project proposes 10,700 square feet of commercial space on the ground floor
that meet the minimum depth and floor area as required by the mixed use
development standards. The commercial storefronts face Washington Boulevard
and both the Harter and Tilden Avenue corners with pedestrian access from the
Washington Boulevard sidewalk and from the surface level parking area.
Access to the residential units is secured by elevators located in the
subterranean residential parking accessed off of Harter Avenue or in lobby areas
off of the Tilden Avenue sidewalk entrance. The project proposes separate
driveways for the residential and commercial components of the project. A
driveway on Tilden Avenue leads to the surface level commercial parking and a
driveway on Harter Avenue leads to the subterranean residential parking. Access
off of the alley is limited to 4 parking spaces designated for employee parking.
There will be no project access off of Washington Boulevard. The orientation of
vehicular access to the site avoids the creation of vehicular hazards. Pedestrian
hazards will not result from the design and layout of the proposed project.
Further compatibility will be achieved through mixed use performance standards.
These standards require walls, floors, and ceilings to be insulated to protect the
project’s residential users from potential noise impacts created by the ground
floor commercial uses. The performance standards do not allow commercial
uses to be operated in such a manner that they produce noise and vibrations that
are detrimental to both the residential and commercial uses. Other aspects of
the performance standards include security code access for elevators or
separate commercial and residential elevators, cross ventilation and high quality
HVAC systems for residential units, illumination of parking areas, residential
protection from commercial loading areas, and adequate sidewalk pedestrian
lighting. All of these design standards are incorporated into the project.
Parking. A total of 106 parking spaces are provided on site to meet the Zoning
Code required parking for both the residential and commercial components of the
project. A total of 72 spaces are required for the 33 residential units (1 each for
the 2 one bedroom units; 2 each for the 31 two bedroom units; and 8 residential
guest parking spaces). 34 spaces are required for the commercial components
of the project. The parking for the residential component will include 65 spaces
(64 for the residential units and 1 guest space) in the one-level subterranean
garage and 41 spaces (7 residential guest and 34 commercial spaces) located
on grade, immediately behind the commercial tenant spaces. Handicap
accessible parking is provided both at the surface level (4 spaces) and at the
subterranean level (1 space). Bicycle parking is also provided both on-site and
along the sidewalk.
ATTACHMENT 6
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The applicant is requesting an Administrative Modification to reduce the required
parking aisle width of 27 feet by 2 feet and allowing for 25 feet at both the
surface and the subterranean parking levels. The project originally provided the
minimum required 2-foot planter strip at the rear of the development’s alley
frontage adjacent to residential zones. In order to provide enhanced screening
and privacy to the nearby residential areas behind the development, staff
requested that the 2 foot landscape planter strip be increased to 5 feet to provide
for significant planting of columnar type trees. This staff requested enhanced
strip narrows the site’s geometry and its ability to provide the code required 27
foot wide drive aisle at both the surface and subterranean parking levels.
Providing the code required 27 foot drive aisle after the installation of the
increased planter strip would result in a site redesign and subsequent loss of
parking spaces, further requiring a reduction in the number of dwelling units
and/or commercial square footage.
As a result of the rear planter strip increase to 5 feet, the parking aisle width at
both the surface and subterranean levels will need to be reduced to 25 feet so
that the project’s goal of 33 dwelling units and 10,700 square feet of ground floor
retail can be achieved. The requested modification is below the maximum
allowed 10% adjustment as stated in Zoning Code Section 17.550 - Variances
and Modifications. Additionally, the requested 25 foot backup space will be
sufficient for automobiles to maneuver into and out of the surface and
subterranean parking spaces and will not cause a negative impact to the projects
vehicular circulation.
Traffic and Circulation
A traffic analysis was conducted for the project by Arthur L. Kassan, P.E.,
consulting traffic engineer and reviewed and accepted for scope and content by
the City’s Traffic Engineer (Attachment No. 4).
The traffic analysis evaluated the existing (year 2011) and forecast future (year
2013) conditions at six intersections in the vicinity of the project site during both
the AM and PM peak hours. In addition to these six study intersections, an
investigation of potential project traffic impacts to four residential streets adjacent
to or near the project was conducted. The traffic analysis estimated that the
project would generate 428 net new daily vehicle trips, including 23 net trips
during the AM peak hour, and 33 net trips during the PM peak hour. The traffic
analysis concluded that the amount of trips generated as a result of the proposed
development does not exceed the threshold for significance for levels of service
(LOS).
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The traffic analysis also indicates that the proposed project will not impact any of
the study intersections, nor would it produce sufficient net new traffic to create
significant impacts to any of the adjacent local/residential streets, or to the area’s
regional arterial roadways and freeways. As a result no off-site traffic mitigation
measures are warranted for the project.
Access to the surface parking lot will be provided through a two-way (entry and
exit) driveway on Tilden Avenue. Access to the subterranean parking which will
be for residents only will be from a two-way driveway on Harter Avenue. The
proposed access locations are anticipated to operate adequately, with no
external vehicular queuing on the fronting streets, and no significant internal
queuing within the parking areas. Vehicles entering the site’s driveway are
provided with adequate visibility and maneuvering room both along the fronting
streets and within the site itself. Site distance and driver visibility of oncoming
vehicles at the site exits are also acceptable. Any structure or fence at driveway
locations will not exceed “eye height” of exiting drivers, and site lines will not be
affected.
The loading area for the project is proposed to be on-street at curbside adjacent
to the project’s frontage on Harter Avenue as permitted by the Zoning Code. The
City Engineer/Public Works Director reviewed the proposed curbside loading and
determined it met Public Works’ standards and does not anticipate significant
operational or access issues. A proposed condition of approval requires the
applicant to process the curbside loading request through the Engineering
Division and to make necessary curbside demarcations as required by the City
Engineer/Public Works Director.
Offsite Improvements
Off-Site Median and Intersection Improvements. Although there are no identified
traffic related impacts per the traffic analysis, staff has identified several
pedestrian and vehicular operational improvements at and near the adjacent
signalized intersections of Washington Boulevard at Washington Place, Harter
Avenue and Tilden Avenue. Improvements to the medians and intersections as
described below is initiated and will be funded by the Redevelopment Agency as
part of an overall effort to revitalize this area and also address community
concerns regarding existing circulation and parking spillover issues.
• Parking will be prohibited on the west side of Tilden Avenue, which is a
thirty foot wide roadway, between the alley and Washington Boulevard.
Also, the existing roadway will be striped to create a twelve foot
ATTACHMENT 6
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unobstructed curbside driving lane and an eighteen foot northbound curb
lane with parking available on the east side of Tilden Avenue.
• The curb at the southwest corner of Tilden Avenue and Washington
Boulevard will be reconstructed to provide a larger radius and minimize
the impact of the existing acute angle experienced by motorists eastbound
on Washington Boulevard turning onto Tilden Avenue. Each of the
changes above will enhance ingress/egress for motorists on Tilden
Avenue, in particular for emergency vehicle access.
• The signalized intersections will be reconfigured to relocate the crosswalk
across Washington Boulevard closer to Tilden Avenue and implement
pedestrian crossings within a single phase in-lieu of the existing two
phase pedestrian crossing.
• The existing raised median islands will also be reconfigured to provide for
more vehicle storage area for east and west traffic on Washington
Boulevard and Washington Place within the multi-leg intersection. The
street medians adjacent to the project site will also be improved with
enhanced landscaping.
• In addition, two low volume left turn movements will be eliminated to and
from Tilden Avenue north of Washington Place. Emergency vehicle
access will not be impaired by the proposed changes.
• New or relocated traffic signals will be repositioned to augment their
visibility for all motorists that traverse the intersections and will be
constructed in conjunction with a Traffic Signal/Intersection
Reconfiguration Improvement Plan.
Streetscape Improvements. The public rights-of-way in and around the project
site area lack streetscape improvements. In the parkway within the public right-
of-way of Washington Boulevard, there are two palm trees and two sets of side
by side palm trees scattered along Washington Boulevard (total of 6 street trees).
In the parkway on Harter Avenue, there are two palm trees set approximately 20
feet to 25 feet apart. There is one palm tree on the corner of Tilden Avenue
parkway. The street trees (primarily palm trees) in the vicinity of the project site
along the Washington Boulevard corridor were planted over 40 years ago and
need to be trimmed or removed. The tree planting in this area is not coherent
and is randomly located. The parkways lack adequate tree planting and
landscaping.
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In order to create a pedestrian and environmentally friendly streetscape a new
design for the portion of Washington Boulevard between Harter Avenue and
Tilden Avenue will be included as part of the Redevelopment Agency’s offsite
improvement plan for this area. The streetscape improvements include new
street trees, planters, new concrete sidewalks with pervious paving inserts, and
new street furniture (benches, trash receptacles, and bicycle racks). The existing
palm trees will be replaced with up to eleven new street trees (seven trees along
Washington Blvd., two trees on Harter Avenue and two trees on Tilden Avenue).
Exact tree location is pending placement of traffic signal equipments. Spreading,
shade trees will be planted to enhance the pedestrian environment and help
rescale the street. The concept of new pedestrian scale street trees for the
proposed project were reviewed and supported by the City’s Landscape Architect
(Parks Manager) and the Public Works Department, which is responsible for
overseeing street trees on the public way. The preliminary landscape plan
identifies the London Plane tree (Platanus Acerfolia) as the street tree that best
fits the area. The streetscape improvements will be similar to what has been
approved by the City Council for installation on portions of Sepulveda Boulevard
between Culver Boulevard and Franklin Avenue.
The applicant/developer (Los Angeles Housing Partnership) as part of the project
development will be required to upgrade the existing bus stop area on the
sidewalk to include a bus shelter, a new bus bench, trash receptacle and bus
stop sign/transit information display. Los Angeles Housing Partnership will also
be required to pay a fee towards the cost and future installation of a real-time bus
arrival information system.
Street Sweeping and Parking District. Feedback from the neighborhood as part
of the community outreach for the project included requested changes relevant to
two services under the charge of the Public Works Department: 1) That the
existing street sweeping schedule on Fridays be modified to not occur during the
mid-day hours; 2) That the City create a permit parking district for the whole
neighborhood, outside of the process articulated by the City Council-adopted
Permit Parking Program, due to existing parking intrusion, as well as due to
concerns over future parking intrusion from the proposed project.
Regarding item 1, the Public Works Department has worked with the street
sweeping contractor and negotiated to modify the street sweeping schedule, at
no cost to the City. Additionally, staff accomplished the reduction of the window
of time for street sweeping from four hours to three hours on both street
sweeping days. The new street sweeping schedule took effect on Wednesday,
February 23
rd
and Friday, February 25, 2011. Prior to the commencement of the
new schedule all the street sweeping signs in the neighborhood were modified by
Public Works staff to reflect the revised hours.
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Regarding item 2, the City Council is scheduled to consider a proposed
preferential parking district for the neighborhood on February 28, 2011. The
proposed district would have time-limited parking of 2 hours, Monday through
Saturday, from 8 am to 6 pm. Anyone with a permit would not be bound to the
time limitation.
Density and Other Incentives (DOBI)
The proposed project includes an increased residential unit density for the
provision of affordable housing consistent with the provisions of State law. The
increased density is allowed per State Density Bonus law (California Government
Code Section 65915, et. seq.) and is stipulated in the Zoning Code that the
processing of density increase requests are required to be consistent with
Government Code Section 65915. The project meets the requirements of State
density bonus law in that it provides an adequate number of affordable housing
units for the percentage increase in density. The base density for this project is
25 dwelling units at the 35 dwelling units per acre, permitted pursuant to the
mixed use development standards. The project includes 8 additional units which
equates to an increase of 35% over the base density for a grand total of 33
dwelling units proposed at the project site. The State allows a maximum of 35%
increase in density provided that 11% of the base units are at the very low
income or 20% are in the low income categories. The project meets and
exceeds this minimum criterion for allowing density increase by providing 14
units at the very low category, 6 units in the low category and 12 units in the
moderate category. There will be one manager’s unit that will be at the market
rate and not restricted.
The DOBI process includes review of the project and conditions of approval
intended to address any potential impacts associated with the density increase.
The site plan review also addresses these potential impacts and the discussion
on traffic, off-site improvements, and site design further illustrate how the project
with its density increase will not impact the community.
Regional Housing Needs Assessment (RHNA)
This project will address a portion of Culver City’s share of the RHNA by
constructing 32 affordable units and 1 market rate unit. All California cities and
counties are subject to the California State Regional Housing Needs Assessment
(RHNA). The RHNA is updated by the State and administered by local
metropolitan planning organizations (MPO’s) such the Southern California
Association of Governments (SCAG). After direction from the State, SCAG
updates and allocates RHNA numbers for member jurisdictions within its
boundaries including Culver City approximately every 4 to 7 years. The intended
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purpose of the RHNA is to set a goal of new housing production within that 4 to 7
year period with an emphasis on new affordable housing. The City’s allocation
for the current planning period is 504 units. The project will address a portion of
Culver City’s share of the RHNA by constructing 32 affordable units (14 very low
income; 6 low income; and 12 moderate income).
Depicted in the table below are the City’s RHNA production requirements for the
current planning period and organized by income category and income maximum
limits. Based upon the RHNA requirements, the City must annually develop
approximately 17 units of very-low income, 10 units of low-income and 11 units
of moderate income housing. During the last RHNA cycle, the City only
produced 29% of its allocation of 650 units. It should be noted, in the last ten
(10) years, the City has only constructed twenty-one (21) units of affordable
housing. All these units were part of the Grandview Palms Assisted Living
Facility for seniors with disabilities.
Regional Housing Needs Assessment
Number
of Units
Income Category % of Area Median
Income*
Max. Income
Limits+
129 Very-low 50 $75,600
80 Low 80 $66,250
85 Moderate 120 $74,500
210 Above Moderate
(Market)
Above 120 Unrestricted
*2010 Los Angeles Median Income = $63,000
+Income Limits based upon a household size of four (4) persons
Comprehensive Housing Strategy
In addition to providing for affordable housing through a density bonus process
and addressing a portion of Culver City’s share of the RHNA, this project furthers
the goals of the City’s Comprehensive Housing Strategy (CHS). As noted above
Culver City’s RHNA requirement over the next 7 years is 504 housing units, with
294 units designated for very-low, low and moderate income households.
The CHS is intended to improve the City’s affordable housing stock and meet
housing production requirements under RHNA through the use of
Redevelopment Agency Housing Set Aside Funds. The premise of the Housing
Set Aside Fund is to “preserve, improve and increase the supply of affordable
housing” (Health and Safety Code Section 33334.2(a). The CHS is based on the
concept of mixed-income, low-density, scattered site affordable housing
developments. With the RHNA housing production requirements functioning as
a guide, the CHS accomplishes the following 3 broad objectives:
ATTACHMENT 6
271 City of Culver City, California
Planning Commission Agenda Item Report
Page 14 of 16
• Assess the housing needs and funding requirements over the 7 ½ year
RHNA planning cycle.
• Provide realistic housing initiatives that best address the City’s unmet housing
needs consistent with the goals and objectives of the Housing Element over
the 7 ½ year planning cycle with Agency owned, small/medium lot
development, TOD developments, building preservation and rehabilitation.
• Effectively allocates the Housing Set Aside Fund to meet the City’s housing
needs.
In March 2008, the Agency reviewed and approved the implementation of Years
1-2 of the CHS. The CHS contains a list of sites proposed for construction of
affordable housing units. The project site is on the list with the objective of 33
affordable units for this location. The project will achieve 32 of the stated goal of
33 units.
Community Meetings and Advisory Committee on Redevelopment (ACOR)
Pursuant to the City’s Community Outreach Guidelines, LAHP hosted community
meetings on September 16, 2010, October 13, 2010, and January 13, 2011; and
will host a final meeting on March 2, 2011. In the initial meetings there was a lot
of concern and questions regarding the project. Many community members
expressed concerns about the existing conditions in the neighborhood. In
particular, concerns were expressed about the demand for on-street parking,
vehicle and pedestrian circulation at the Washington Blvd/Washington
Place/Tilden Ave. intersection, and the elimination of on-street parking for street
sweeping purposes around the mosque at noon on Fridays, when parking
demand at the nearby mosque peaks. As noted above, the project includes off-
site improvements as well as City street sweeping operations revisions, and the
establishment of permit parking intended to address these concerns.
With regard to design, most comments at the community meetings were
concerned with height, density, massing, and privacy. The project architects and
staff attended each community meeting. Staff worked closely with the project
architect and the developer and made significant design and site plan changes to
address most of the concerns raised by the community. As noted above, the
building is within the allowed height, and actually lower than the maximum
permitted. The massing has been broken up into various planes by compliance
with the mixed use development standards setback and stepback requirements
and the incorporation of open space/courtyards, overhangs and canopies,
balconies and landscape planters. Variations introduced by the color and
material finishes palette also address the massing issue. Privacy concerns are
addressed through the enhanced rear landscape strip. New streetscape
ATTACHMENT 6
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Planning Commission Agenda Item Report
Page 15 of 16
improvements will be provided along Washington Boulevard to further enhance
the project and the neighborhood.
The final community meeting on March 2
nd
will provide an opportunity for the
applicant to present the final design to the community prior to the Planning
Commission public hearing. Staff will give a verbal report on this meeting as part
of its presentation on March 3
rd
.
Written comments for and against the project were received by the City and the
Redevelopment Agency (refer to Attachment No. 5).
On October 7, 2010, the proposed project was presented to the Advisory
Committee on Redevelopment (ACOR.) No final vote or resolution was taken by
the members of ACOR but in their individual comments they tended to support
the project while echoing some of the concerns expressed by the neighborhood
(refer to ACOR minutes, Attachment No. 6).
CONCLUSION:
Staff has worked closely with the applicant from the project inception to guide its
design in order to meet Zoning Code requirements, address potential community
concerns and create a mixed use residential development that promotes area
redevelopment goals and is consistent good planning practice. Based on the
analysis contained herein staff believes the findings for a Site Plan Review,
Administrative Modification and Density and Other Incentives, can be made as
outlined in proposed Resolution No. 2011-P003 (Attachment No. 7) and
recommends project approval.
ENVIRONMENTAL DETERMINATION:
Pursuant to the California Environmental Quality Act (CEQA) guidelines a
Mitigated Negative Declaration (MND) has been prepared; the project has been
determined to have less than significant impacts on the community. The project
is consistent with the Zoning Code regulations, and the traffic study determined
that expected increased traffic will be below thresholds of significance.
ALTERNATIVE OPTIONS:
The following alternative actions may be considered by the Planning
Commission:
1. Approve the application with the recommended conditions of approval if the
application is deemed to meet the required findings.
ATTACHMENT 6
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Planning Commission Agenda Item Report
Page 16 of 16
2. Approve the application with additional or different conditions of approval, if
deemed necessary to meet the required findings and mitigate any new project
impacts identified at the meeting.
3. Disapprove the application if it does not meet the required findings.
ATTACHMENTS:
1. Project Summary
2. Area Map
3. Initial Study/Mitigated Negative Declaration dated February 10, 2011.
4. Traffic Analysis prepared by Art L. Kassan, P.E., dated February 2011.
5. Written Comments or Correspondence Regarding the Project.
6. ACOR Minutes, dated October 7, 2010.
7. Draft Resolution No. 2011-P003 (SPR P-2011012, AM P-2011014, and DOBI
P-2011015)
8. Development Plans date stamped February 24, 2011.
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335A SUMMARY REPORT
PURSUANT TO SECTION 33433 OF THE
CALIFORNIA HEALTH AND SAFETY CODE
FOR THE SALE OF PROPERTIES
LOCATED AT 11054 AND 11056 WASHINGTON BOULEVARD
IN CULVER CITY, CALIFORNIA
The following Summary Report has been prepared pursuant to Section 33433 of
the California Health and Safety Code. The report sets forth certain details of the
proposed Disposition and Development Agreement (Agreement) between the
Culver City Redevelopment Agency (Agency) and Tilden Terrace, LP
(Developer). The purpose of the Agreement is to effectuate the Redevelopment
Plan for Component Area No. 4 of the Redevelopment Project Area
(Redevelopment Plan).
The Agreement requires Agency to convey the properties located at 11054, and
11056 Washington Boulevard, (Site), to the Developer for the subsequent
development of a 33-unit residential and 10,700 square foot, commercial, mixed
use project (the Project). The Site is 22,756 square feet of land area, (i.e. 0.52
acres.) The proposed Developer owns the adjoining parcel at 11042-52
Washington Boulevard and the development described in the Agreement is on
the combined parcel consisting of the Site and the Developer owned parcel.
I. COST OF THE AGREEMENT TO THE AGENCY
The proposed Agreement requires the Agency to sell the Site to the Developer
for the development of the Project. The Agency began assembling the Site in
2006 and completed the acquisitions in June 2008. The Agency did not fund any
of the implementation costs with bond proceeds.
To date the Agency has spent $4,803,546 in unrestricted Property Tax Increment
Funds (80% Funds) to implement the Project. These costs are presented in the
following table:
Land purchase price $4,402,000
Interest paid on purchase price 255,750
Title and escrow costs 12,225
ATTACHMENT 9
33611054-11056 Washington Blvd. Summary Report March 3, 2011
Printed on Recycled Paper Page 2
Relocation 22,173
Demolition and hazardous materials abatement 65,347
Consultant costs 30,674
Property management 14,109
Utilities 1,268
Total $4,803,546
The Project exhibits an $11,800,000 financial gap that will be paid for using a
combination of Property Tax Increment Housing Set Aside Funds (Set-Aside
Funds) and 80% Funds. The resulting total Agency costs of $16,603,546 will be
allocated as follows:
Set-Aside
Funds
80% Funds
Costs incurred to date $0 $4,803,546
Land acquisition cost reallocation 2,855,000 (2,855,000)
Direct financial assistance 8,950,000 2,850,000
Total Cost $11,805,000 $4,798,546
The $11,805,000 in Set-Aside Funds costs will be contributed to the residential
component of the Project in the form of a residual receipts loan. A $3,395,000
residual receipts loan will be applied to the commercial component of the Project.
The remaining $1,403,546 in costs incurred by the Agency will not be recouped
from the Developer.
The Set-Aside and 80% Loans carry a total principal balance of $15.2 million.
The Agency anticipates receiving some residual receipts debt service payments
over the 55-year loan repayment term; and any outstanding principal and interest
balance shall be due at the end of the loans’ terms. Recognizing that the
repayment schedule will be based solely on the Project’s actual performance, it is
not possible to accurately predict the amount of interest that will accrue on the
residual receipts loans. In turn, the repayment amount and timing are too
speculative to project as part of this analysis.
ATTACHMENT 9
33711054-11056 Washington Blvd. Summary Report March 3, 2011
Printed on Recycled Paper Page 3
II. ESTIMATED VALUE OF THE INTERESTS TO BE CONVEYED DETERMINED
AT THE HIGHEST USE PERMITTED BY THE REDEVELOPMENT PLAN
Section 33433 of the California Health and Safety Code requires the Agency to
identify the value of the interests being conveyed at the highest use allowed by
the Redevelopment Plan. The valuation must be based on the assumption that
the property is vacant, and that near-term development is required; the valuation
does not take into consideration any extraordinary restrictions being imposed on
the development by the Agency.
The Developer engaged Ryon Associates to determine the Site’s value under the
C3 (General Commercial) zoning that is in place on the Site. This zoning
designation permits a wide variety of commercial and mixed-use development.
In a report dated February 25, 2011, Ryon Associates set the fair market value of
the Site at $3,400,000 ($149 per square foot of land area). This report also
concluded that the highest and best use of the Site permitted by the
Redevelopment Plan for Component Area No. 4 would be mixed-use commercial
and multi-family residential development.
III. ESTIMATED REUSE VALUE OF THE INTERESTS TO BE CONVEYED
Keyser Marston Associates, Inc. (KMA) prepared a reuse valuation analysis of
the Project based on the financial terms and conditions imposed by the
Agreement. The KMA analysis concluded that the fair reuse value of the Site is
negative $11.8 million. This means that the Site would have to be donated to the
Project at no cost, and $11.8 million in direct financial assistance would need to
be provided to make the Project financially feasible.
IV. CONSIDERATION RECEIVED AND COMPARISON WITH THE ESTABLISHED
VALUE
The Agreement imposes extraordinary controls on the project. The Developer
must develop a 33-unit residential project with 10,700 square feet of commercial
space, 1,170 square feet of community room space, 65 subterranean parking
spaces and 41 at-grade podium parking spaces on the Site. Additionally, the
Developer must impose long-term income and affordability restrictions on 32
units in the Project. The impacts created by these requirements reduce the $3.4
million value of the Site at the highest use allowed by the Redevelopment Plan,
to the established fair reuse value of negative $11.8 million.
ATTACHMENT 9
33811054-11056 Washington Blvd. Summary Report March 3, 2011
Printed on Recycled Paper Page 4
The Agreement imposes loan obligations totaling $15.2 million on the Project.
The Developer must make annual debt service payments on these obligations
using the cash flow generated by the Project. At the end of the loans’ terms, the
Developer must repay any outstanding principal and interest balances. Given
that any repayment proceeds received by the Agency will be greater than the
established fair reuse value of negative $11.8 million, it can be concluded that
the Agency is receiving fair consideration for the interests being conveyed to the
Developer.
V. ELIMINATION OF BLIGHT/COMPLIANCE WITH THE AB 1290
IMPLEMENATION PLAN
Development of the Site as proposed will continue the Agency's efforts to
eliminate blight in Component Area No. 4 of the Culver City Redevelopment
Project as amended on November 23, 1998. The prior uses on the Site
consisted of the Pleasantview Home, one commercial business and one two-
bedroom residential apartment unit.
The Site was selected for redevelopment because the Pleasantview Home
structure exhibited significant physical deterioration and deferred maintenance.
Moreover, the buildings on the block were not attractive or inviting, and were
operated primarily by marginal economic concerns. In addition high incidences
of anti-social behavior by occupants of the Pleasantview Home led to a higher
number of police calls to the Site.
In the report to the City Council for the Culver City Redevelopment Plan, dated
October 1998, the properties comprising the Site were listed as having economic
factors, as well as deterioration, incompatible uses, factors that prevent or hinder
the viable use of the buildings or lots and at least one is too small to
economically redevelop alone. Due to the physical limitations of the individual
properties, such as limited depth and inadequate parking, developers expressed
little interest in the area. In order to create a feasible, more economically viable
development site, consolidation by the Agency of the entire block was necessary.
In March 2008, the Agency Board adopted its Comprehensive Housing Strategy
which identified the Site as a location for an affordable housing development
within the next two years. Section 33433 defines the provision of affordable
housing as a blight elimination activity.
ATTACHMENT 9
339PROOF OF PUBLICATION
(2015.5 C.C.P.)
STATE OF CALIFORNIA,
COUNTY OF LOS ANGELES
I am a citizen of the United States and a resident
of the County aforesaid; I am over the age of
eighteen years, and not a party to or interested in
the above-entitled matter.
I am the principal clerk of the printer of the
Culver City News
a newspaper of general circulation, printed and
published weekly in the City of Culver City,
County of Los Angeles, and which newspaper
has been adjudged a newspaper of general cir-
culation by the Superior Court of the County of
Los Angeles, State of California, under the date
of April 24, 1980 , Case Number 315458 ; that
the notice, of which the annexed is a printed copy
(set in type not smaller than nonpareil), has been
published in each regular and entire issue of said
newspaper and not in any supplement thereof on
the following dates, to-wit:
Publish
March 3 and 10
all in the year 2011.
I certify (or declare) under penalty of perjury
that the foregoing is true and correct.
Dated at Los Angeles, California,
13 day of March, 2011.
Signature
______________________________________
Culver City News
4351 Sepulveda Blvd.
Culver City, CA 90230
(310) 437-4401 ext. 230 Fax (310) 391-9068
ATTACHMENT 10
341
Notice published in the Culver City News on March 3 and 10, 2011.
The City Council and Redevelopment Agency invite your participation in a joint Public Hearing concerning:
WHO: Los Angeles Housing Partnership (Applicant/Owner) and the Culver City Redevelopment Agency
WHAT: A Density and Other Bonus Incentives request to allow for a density increase in exchange for the
provision of affordable housing pursuant to State law in a three (3) story mixed use development with
approximately 10,700 square feet of commercial space on the ground floor and a total of 33 residential
units on the upper floors with a total of 106 on-site parking spaces.
The proposed sale from the Redevelopment Agency to Tilden Terrace, L.P. (“Developer”), whose
Managing General Partner is Los Angeles Housing Partnership, of the portion of the development site
currently owned by the Agency, located at 11054-11056 Washington Boulevard (the “Agency Parcels
and; a Disposition and Development Agreement between the Redevelopment Agency and the Developer,
setting forth the terms and conditions of the sale of the Agency Parcels, the financial assistance to be
provided by the Agency, and the development and operation of the proposed project.
Project Location: 11042 - 11056 Washington Boulevard (see attached Project Site Map)
Case No: Density and Other Bonus Incentives, DOBI-P2011015
Zoning: Commercial General General Plan: General Corridor
WHERE: City Hall - Mike Balkman Council Chambers
9770 Culver Boulevard, Culver City, CA 90232
WHEN: Monday, March 21, 2011, at 7:00 PM
WHY: The purpose of the joint Public Hearing is for the City Council and Redevelopment Agency to review and
to receive public input on the Density and Other Bonus Incentives request and the sale of the Agency
Parcels. Pursuant to the California Community Redevelopment Law (Health and Safety Code Sections
33000, et seq.), the City Council and Redevelopment Agency will consider the proposed sale of the
Agency Parcels and the proposed terms and conditions of that sale, the proposed Disposition and
Development Agreement, and all evidence and testimony for and against the Agreement and the sale of
real property. All members of the public are welcome to attend and participate in the public hearing.
CEQA: Pursuant to the California Environmental Quality Act (CEQA) guidelines, an Initial Study and Mitigated
Negative Declaration (MND) finding has been prepared and circulated for review for the proposed project.
A copy of the MND is available for public review at City Hall from February 24, 2011 to March 15, 2011.
More Info: A Summary Report in connection with the proposed Disposition and Development Agreement, which sets
forth: (a) the cost to the Agency of the Agreement, (b) the estimated value of the Agency Parcels,
determined (i) at the highest and best use permitted, and (ii) at the use and with the conditions,
covenants, and development costs required by the Agreement, (c) the sales price for the Agency Parcels,
(d) an explanation of why the sale of the Agency Parcels will assist in the elimination of blight, and (e)
other pertinent economic analysis is available. The Summary Report and the proposed Agreement will be
available for inspection at the City Hall, Redevelopment Agency Office and the Julian Dixon Library, 4975
Overland Ave., Culver City, on or after March 3, 2011. The staff report for the project will be available
for viewing on the City’s website on or after March 16, 2011, at www.culvercity.org, or at the City Hall,
Community Development Department, or the Julian Dixon Library, 4975 Overland Avenue, Culver City.
Persons unable to attend the hearing may submit comments/questions to Susan Yun, Senior Planner or John Fisanotti,
Redevelopment Project Manager by any of the following means BEFORE 5:30 PM on March 21, 2011:
1. By LETTER to City Hall, Community Development Department, 9770 Culver Blvd., Culver City, CA
90232,
2. By FAX at (310) 253-5721 (Planning); or (310) 253-5779 (Redevelopment)
3. By E-MAIL/PHONE to susan.yun@culvercity.org at (310) 253-5755; or
john.fisanotti@culvercity.org at (310) 253-5767
Public Hearing
Tilden Terrace 11042-11056 Washington Blvd.
City of Culver City and Culver City Redevelopment Agency
Official Notification
Notice published in the Culver City News on March 3 and 10, 2011.
The City Council and Redevelopment Agency invite your participation in a joint Public Hearing concerning:
WHO: Los Angeles Housing Partnership (Applicant/Owner) and the Culver City Redevelopment Agency
WHAT: A Density and Other Bonus Incentives request to allow for a density increase in exchange for the
provision of affordable housing pursuant to State law in a three (3) story mixed use development with
approximately 10,700 square feet of commercial space on the ground floor and a total of 33 residential
units on the upper floors with a total of 106 on-site parking spaces.
The proposed sale from the Redevelopment Agency to Tilden Terrace, L.P. (“Developer”), whose
Managing General Partner is Los Angeles Housing Partnership, of the portion of the development site
currently owned by the Agency, located at 11054-11056 Washington Boulevard (the “Agency Parcels
and; a Disposition and Development Agreement between the Redevelopment Agency and the Developer,
setting forth the terms and conditions of the sale of the Agency Parcels, the financial assistance to be
provided by the Agency, and the development and operation of the proposed project.
Project Location: 11042 - 11056 Washington Boulevard (see attached Project Site Map)
Case No: Density and Other Bonus Incentives, DOBI-P2011015
Zoning: Commercial General General Plan: General Corridor
WHERE: City Hall - Mike Balkman Council Chambers
9770 Culver Boulevard, Culver City, CA 90232
WHEN: Monday, March 21, 2011, at 7:00 PM
WHY: The purpose of the joint Public Hearing is for the City Council and Redevelopment Agency to review and
to receive public input on the Density and Other Bonus Incentives request and the sale of the Agency
Parcels. Pursuant to the California Community Redevelopment Law (Health and Safety Code Sections
33000, et seq.), the City Council and Redevelopment Agency will consider the proposed sale of the
Agency Parcels and the proposed terms and conditions of that sale, the proposed Disposition and
Development Agreement, and all evidence and testimony for and against the Agreement and the sale of
real property. All members of the public are welcome to attend and participate in the public hearing.
CEQA: Pursuant to the California Environmental Quality Act (CEQA) guidelines, an Initial Study and Mitigated
Negative Declaration (MND) finding has been prepared and circulated for review for the proposed project.
A copy of the MND is available for public review at City Hall from February 24, 2011 to March 15, 2011.
More Info: A Summary Report in connection with the proposed Disposition and Development Agreement, which sets
forth: (a) the cost to the Agency of the Agreement, (b) the estimated value of the Agency Parcels,
determined (i) at the highest and best use permitted, and (ii) at the use and with the conditions,
covenants, and development costs required by the Agreement, (c) the sales price for the Agency Parcels,
(d) an explanation of why the sale of the Agency Parcels will assist in the elimination of blight, and (e)
other pertinent economic analysis is available. The Summary Report and the proposed Agreement will be
available for inspection at the City Hall, Redevelopment Agency Office and the Julian Dixon Library, 4975
Overland Ave., Culver City, on or after March 3, 2011. The staff report for the project will be available
for viewing on the City’s website on or after March 16, 2011, at www.culvercity.org, or at the City Hall,
Community Development Department, or the Julian Dixon Library, 4975 Overland Avenue, Culver City.
Persons unable to attend the hearing may submit comments/questions to Susan Yun, Senior Planner or John Fisanotti,
Redevelopment Project Manager by any of the following means BEFORE 5:30 PM on March 21, 2011:
1. By LETTER to City Hall, Community Development Department, 9770 Culver Blvd., Culver City, CA
90232,
2. By FAX at (310) 253-5721 (Planning); or (310) 253-5779 (Redevelopment)
3. By E-MAIL/PHONE to susan.yun@culvercity.org at (310) 253-5755; or
john.fisanotti@culvercity.org at (310) 253-5767
Public Hearing
Tilden Terrace 11042-11056 Washington Blvd.
City of Culver City and Culver City Redevelopment Agency
Official Notification
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