HomeMy WebLinkAbout25D - AGMT - ALLOCATION NSP 3REQUEST FOR
COUNCIL ACTION
CITY COUNCIL MEETING DATE:
JUNE 20, 2011
TITLE:
AGREEMENT WITH ANR HOMES, INC.
FOR THE IMPLEMENTATION OF THE
NEIGHBORHOOD STABILIZATION
PROGRAM 3
CITY MA GER
RECOMMENDED ACTION
CLERK OF COUNCIL USE ONLY:
APPROVED
? As Recommended
? As Amended
? Ordinance on 151 Reading
? Ordinance on 2"d Reading
? Implementing Resolution
? Set Public Hearing For
CONTINUED TO
FILE NUMBER
Authorize the City Manager and the Clerk of the Council to execute the attached agreement with
ANR Homes, Inc. for implementation of the Neighborhood Stabilization Program 3 activities in an
amount not to exceed $1,317,703 plus program income, subject to non-substantive changes
approved by the City Manager and City Attorney.
COMMUNITY REDEVELOPMENT AND HOUSING COMMISSION ACTION
At its regular meeting on June 7, 2011, by a vote of 4:0 (Verino absent), the Community
Redevelopment and Housing Commission approved the recommended action.
DISCUSSION
The Dodd-Frank Act appropriated $1 billion for a third round of Neighborhood Stabilization (NSP 3)
funds to be directly allocated to states and localities to stabilize neighborhoods that have been
impacted by foreclosed or abandoned properties. Based on the funding distribution formula
established by the U. S. Department of Housing and Urban Development (HUD), Santa Ana has
been allocated $1,464,113. In order for a property to be eligible for this funding, the lender must
have initiated the foreclosure process. The City will use its funds to acquire, rehabilitate, and resell
to qualified homebuyers.
On February 28, 2011, the City released a Request for Proposals (RFP) soliciting proposals for
entities to assist in the implementation of the NSP 3 activities. Notice of the RFP's availability was
mailed and emailed to 112 development firms who have expressed interest in housing-related
RFPs. It was also noticed on the City's website and in the Orange County Reporter on February
28, 2011. A total of three proposals were received by the April 7, 2011, deadline of which two
were considered responsive. The proposals were reviewed on May 3, 2011, by a team of three,
including one staff person from the City of Long Beach. Proposals were scored in the following
areas: Lead and Team Experience, Proposed Budget and Timeline, and Developer Fee. Because
of the strict timelines imposed by HUD, the greatest weight was placed on experience in
25D-1
NSP 3 Implementation Agreement
June 20, 2011
Page 2
purchasing, rehabilitating and selling foreclosed properties, and where applicable, on team
member experience in working together in an efficient and timely manner. The table below lists
responsive applicants and their scores from their proposal.
Ac uisition/Rehabilitation/Resale - Single Family Program
ANR Homes, Inc. 92
Neighborhood Housing Services of Orange County, Inc. 83
Based on the rating of its proposal, the interview and previous experience, ANR Homes, Inc.
(ANR) is being recommended. ANR has been acquiring, rehabilitating and selling foreclosed
properties since 1995. Working with many local government agencies and nonprofit corporations,
ANR has rehabilitated more than 3,000 properties throughout Southern California. Additionally,
through the City's previous allocations of NSP, ANR has acquired and rehabilitated 50 single
family homes since July 2009 of which 36 have already been sold to income-qualified homebuyers.
ANR also works with fourteen other public entities utilizing NSP funds throughout Southern
California.
As part of its proposal, ANR provided commitment letters from two financial institutions to leverage
the City's NSP funds. With these funding commitments, ANR has the capacity to finance up to
80% of costs with its own acquisition/construction lender. This leveraging will allow the City to
meet and possibly exceed its goals which were identified in the application to HUD as seven single
family homes. The NSP funds will be used for acquisition and rehabilitation costs. Given the
desire to recycle funds and stabilize communities as quickly as possible, ANR will be working with
local real estate brokers that are most knowledgeable of the market and have a successful track
record.
FISCAL IMPACT
Funds for the Acquisition/Rehabilitation/Resale Activities are available in the Neighborhood
Stabilization Program 3 Grant Fund account (no. 14218762-62300).
APPROVED AS TO FUNDS AND ACCOUNTS:
-1K a 6
Nancy T. E ards Francisco Gutierrez
Interim Exe tive Director Executive Director
Community Development Agency Finance & Management Services Agency
NTE/SLB/MA/kg
Exhibit: 1. Agreement
25D-2
NEIGHBORHOOD STABILIZATION PROGRAM
(PROGRAM 3) GRANT SERVICES AGREEMENT
This Agreement is executed by and between the City of Santa Ana, a charter city and
municipal corporation organized and existing under the Constitution and laws of the State of
California (hereinafter "City") and ANR Santa Ana NSP, LLC, a California limited liability
corporation ("Developer") as of June 21, 2011.
RECITALS:
A. Title III of Division B of the Housing and Economic Recovery Act of 2008 (Pub. L 110-
289, 122 Stat. 2654 enacted July 30, 2009), as amended, and an additional allocation of
funds provided under Section 1497 of the Wall Street Reform and Consumer Protection
Act of 2010 (Pub. L. 111-203, approved July 21, 2010) makes available to certain
qualified municipalities for certain qualified grant funds termed Neighborhood
Stabilization Program ("NSP Funds") under a program termed the Neighborhood
Stabilization Program (the "NSP").
B. On October 19, 2010, the U.S. Department of Housing and Urban Development ("HUD")
issued a Notice of Funding Availability (NOFA) for Neighborhood Stabilization Program
3 Funds (NSP 3). In March 2011, the City adopted a Substantial Amendment to its
2010-2011 Consolidated Plan Annual Action Plan for $1.4 million.
C. On March 4, 2011, the City was notified that its application under the NSP for NSP 3
Funds was approved by HUD. Funding for Developer is allocated for acquisition and
rehabilitation of the single family components of the NSP3 program in an amount not to
exceed $1,317,703 plus program income.
D. The City has developed certain criteria and guidelines for implementation of its
Neighborhood Stabilization Program for the NSP funds. The City has identified the
target area as illustrated in the map attached hereto as Exhibit A.
E. The City intends for the NSP funds to be primarily used for acquisition of foreclosed
properties and any expenses related to the acquisition and disposition of such properties,
including developer fees. Only in special circumstances will the NSP funds be used for
the rehabilitation costs associated with foreclosed properties.
NOW THEREFORE, the parties agree as follows:
100. DEFINITIONS
"Affordable Sales Price" shall mean a purchase price which results in an
affordable cost to a Low, Moderate, and/or Middle Income Purchaser. The Affordable
Sales Price for Low Income households will be the product of 30% times 50% of the
Area Median Income adjusted for family size appropriate for the unit. For Middle
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Income households, the Affordable Sales Price will be the product of 35% times 100% of
the Area Median Income, adjusted for family size appropriate for the unit.
"Agency" means the Community Redevelopment Agency of the City of Santa
Ana, 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 (Health and Safety Code Section 33000 et seq.) The principal office of the
Agency is located at 20 Civic Center Plaza, Santa Ana, California, 92702.
"Agreement" means this Neighborhood Stabilization Program Agreement
between the City and the Developer, and any attachments thereto.
"Applicable Law" shall mean those federal, state and local laws, ordinances,
regulations, policies and procedures applicable to the NSP, and the NSP 3 Funds.
"Blighted" a structure is blighted when it exhibits objectively determinable signs
of deterioration sufficient to constitute a threat to human health, safety and welfare.
"Building Permit" means the building permit(s) issued by City and required for
the rehabilitation, if any.
"Business Day" means any Monday, Tuesday, Wednesday, Thursday or Friday
on which Santa Ana City Hall is open to the public for the conduct of City affairs.
"City" means the City of Santa Ana, a charter city and municipal corporation.
"Current Market Appraised Value" the current market appraised value means
the value of a foreclosed residential property that is established through an appraisal
made in conformity with the appraisal requirements of the Uniform Relocation Act
(URA) 49 CFR 24.13 and completed within 60 days prior to the final offer made for the
property.
"Deed of Trust" means the Deed of Trust with the Developer encumbering the
NSP Assisted Unit in the form attached hereto as Exhibit B.
"Developer" means ANR Homes Inc., a California corporation, and its affiliate,
ANR Santa Ana, NSP, LLC.
"Eligible Property" shall mean a property that the City shall in its sole discretion
determines meets NSP Program Criteria.
"Executive Director" means the Executive Director of the Community
Development Agency, or his/her designee.
"Foreclosed" As defined by HUD for the purposes of NSP means "A home or
residential property has been foreclosed upon if any of the following conditions apply"
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(a) The property's current delinquency status is at least 60 days delinquent under the
Mortgage Bankers of America delinquency calculation and the owner has been notified;
(b) the property owner is 90 days or more delinquent on tax payments; (c) under state,
local, or tribal law, foreclosure proceedings have been initiated or completed; or (d)
foreclosure proceedings have been completed and title has been transferred to an
intermediary aggregator or servicer that is not an NSP grantee, contractor, subrecipient,
developer, or end user.
"Hazardous Materials" means flammable materials, explosives, radioactive
materials, hazardous wastes, toxic substances and similar substances and materials,
including all substances and materials defined as hazardous or toxic wastes, substances or
materials under any applicable law, including without limitation the Resource
Conservation and Recovery Act, 42 U.S.C. §§ 6901 et sec., and the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. §§ 9601, et
seq., as amended.
"Homebuyer" shall be the qualified low, moderate, and/or middle income
household that originally purchases the NSP Assisted Unit from the Developer.
"Homebuyer Deed of Trust" means the deed of trust encumbering the NSP
Assisted Unit, in the form attached hereto as Exhibit C to be executed by the Homebuyer
at the time of sale.
"Housing Rehabilitation Standards" NSP funded activities will adhere to the
Housing Rehab Standards (attached hereto and incorporated herein as Exhibit D). This
standard exceeds the HUD Housing Quality Standards. The Standards shall correct
housing deficiencies and address items deemed essential for basic health, safety, and
welfare. All work shall meet the Uniform Building Code (UBC), Uniform Plumbing
Code (UPC), Uniform Mechanical Code (UMC), National Electric Code (NEC) as
amended periodically.
"HUD" means the United States Department of Housing and Urban Development
and any successors or assigns thereof.
"Lien" means any lien, mortgage, pledge, security interest, charge or
encumbrance of any kind (including any conditional sale or other title retention
agreement, any lease in the nature thereof, and any agreement to give any lien or security
interest).
"Low Income" means an adjusted income which does not exceed fifty percent
(50%) of the Orange County, California PMSA, adjusted for household size, as published
by HUD. This income limit will be used to determine the Homebuyer's maximum
income for eligibility to purchase a Low Income Unit.
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"Median Income for the Area" means the median income for the Orange
County, California PMSA as most recently determined by HUD. Also may be referred to
interchangeably in the Loan Documents as "Area Median Income" or "AMI".
"Middle Income" means an adjusted income which does not exceed one hundred
twenty percent (120%) of the Orange County, California PMSA, adjusted for household
size, as published by HUD. This income limit will be used to determine the Homebuyer's
maximum income for eligibility to purchase a Middle Income Unit.
"Neighborhood Stabilization Program" (NSP) has the meaning set forth in the
Recitals above.
"Neighborhood Stabilization Program (NSP) Regulations" has the meaning
set forth in the Recitals above.
"NSP Assisted Units" shall mean those residential units purchased and
rehabilitated on Eligible Properties which are subject to the term of affordability.
"NSP Funds" shall mean the money provided under the NSP 3 Program for the
acquisition and rehabilitation of the homes hereunder.
"Target Area" shall mean the map attached hereto and incorporated herein as
Exhibit A.
"Term of Affordability" the term of affordability shall be forty-five (45) years.
"Vicinity" shall mean the Target Area as identified by the City for the NSP funds
and approved by HUD.
200. PROPERTY ACQUISITION
201. Selection of Properties by Developer. Developer shall with reasonable diligence
seek to identify proposed Eligible Properties which it determines may meet NSP Program
Criteria. Only vacant and foreclosed properties will be considered, unless otherwise authorized
by the City. The Developer shall provide the City with its Acquisition/Rehabilitation Bid
Analysis on each potential property to the City. Upon receipt of complete bid analysis, the City
shall review said within two (2) working days, subject to final approval after inspection by City
rehabilitation staff which shall occur within two (2) additional working days. The City will
approve or reject properties for purchase through the NSP Program. Developer shall negotiate
the purchase of the property with the current owner which must be consistent with NSP
guidelines. Developer has the capacity to finance up to 80 percent of costs with its own
acquisition/construction lender. Developer shall take, insure and hold title to the property, and
prepare a scope of work to be reviewed by the City. The City anticipates mainly using NSP
funds for acquisition, costs associated with maintenance, sales and other related soft costs. The
actual number of housing units to be acquired and rehabilitated by Developer will be determined
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by the City in its sole discretion based in part on the amount of NSP Funds awarded to Santa
Ana.
202. Properties Provided by the National Community Stabilization Trust. The parties
shall also be working in conjunction with the National Community Stabilization Trust (NCST) to
identify potential eligible properties. Each of the parties has signed a Memorandum of
Understanding with NCST and agreed to the Acquisition Program Guidelines issued by NCST.
Any properties purchased in collaboration with NCST must comply with all NCST requirements
and follow the NCST framework for acquisition of eligible properties.
203. Offer to Purchase. Any offers to purchase must include a contingency for appraisal
to be in compliance with NSP Regulations. Once appraisal is in compliance, then a final offer to
purchase may be submitted.
204. Appraisals. The City shall provide its approved list of appraisers to be used for all
NSP activities to the Developer. Developer shall select and pay the appraiser directly as one of
its development costs.
205. Funding of Acquisition. City shall deposit into escrow, funds for Developer as agreed
upon during the Selection Phase. City shall record a lien, in the form of a Deed of Trust, against
each of the selected properties equal to the amount of money deposited into escrow for such
property. Said lien will be released upon sale of the Property to a qualified homebuyer, when the
Deed of Trust and Promissory Note (attached hereto and incorporated herein as Exhibit E) are
executed. The City is willing to subordinate its Deed of Trust to the primary lender.
300. REHABILITATION REQUIREMENTS.
The following Rehabilitation Requirements shall apply to all NSP Assisted Units:
301. Permits and Approvals. Developer shall diligently obtain all permits, including all
building permits, licenses, approvals, exemptions and other authorizations of governmental
agencies required in connection with the rehabilitation of the Property.
302. Commencement and Completion of Rehabilitation. The Rehabilitation shall be
considered complete for purposes of this Agreement only when (a) all work described has been
completed and fully paid for, and (b) all work requiring inspection or certification by any
governmental authority has been completed and all requisite certificates, approvals and other
necessary authorizations (including required final certificates of occupancy) have been obtained.
303. Rehabilitation Standards. Residential Rehabilitation Standards (24 CFR 570):
Developer certifies that it will perform rehabilitation in conformance to the standards outlined in
the City's Residential Rehabilitation Standards, which exceed the HUD Housing Quality
Standards and with strict adherence to state and local building codes, safety standards, protection
of historical integrity and for maximum achievement in the area of energy efficiency. Demolition
shall be conducted in cases of extreme deterioration, to eliminate illegal additions, and in concert
with local authorities.
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304. Protection of Historical Structures (24 CFR Part 58/36CFR Part 800).
Developer will comply with and obtain approval of the Federal and State Historic
Preservation Commission(s) when rehabilitation activities are planned on a structure that is listed
on the state historic registry, and will provide documentation of such approval to the City prior to
commencement of any rehabilitation activities on a property which is funded through this
program.
305. Lead-Based Paint. Developer shall comply with the requirements, as applicable of
the Lead-Based Paint Poisoning Prevention Act (42 U.S.C. 4821-4846) and implementing
regulations at 24 CFR 35 for any housing project it undertakes pursuant to this Agreement. For
the activities outlined in this Agreement, Developer will be required to pay particular attention to
subpart J (Rehabilitation); subpart K (Acquisition, Leasing, Support Services or Operation) and
Subpart R (Methods and Standards for lead based paint hazard reduction activities).
306. Asbestos Abatement: The United States Environmental Protection Agency (EPA)
has defined asbestos containing materials (ACM) to be any substance containing more than one
percent (I%) or more asbestos by weight.
All ACM's must be abated prior to demolition or renovation/remodeling activities by a
Cal-OSHA licensed asbestos abatement contractor using methods in accordance with 8 CCR
1529 and SCAQMD Rule 1403. Asbestos abatement procedures should be monitored by a third
party or consultant knowledgeable in asbestos abatement procedures and is, at a minimum, either
a Cal-OSHA certified Site Surveillance Technician or Certified Asbestos Consultant.
The survey for ACMs shall be performed in conjunction with the survey for lead-based
paint. All suspect materials are sampled and tested in accordance with the general guidelines for
bulk asbestos sampling as presented in Section 40, Part 763 (AHERA) of the Code of Federal
Regulations (CFR) and the United States EPA.
307. Energy Efficient Products. Developer shall include energy efficient products in
the rehabilitation of the homes. Such products include the following features: low-flush toilets,
insulation, high heating efficiency systems, energy efficient windows and tankless water heaters.
When the rehabilitation involves new landscaping, lawn areas are reduced and low-maintenance
and drought tolerant plants are installed.
308. Rehabilitation Act - Section 504 (As Applicable). Section 504 of the
Rehabilitation Act of 1973 prohibits discrimination in federally-assisted activities and programs
on the basis of handicap, and imposes requirements to ensure that qualified individuals with
handicaps have access to these programs and activities.
309. Property Standards. Developer shall cause the Property to meet the housing
quality standards set forth in 24 CFR 882.109, as well as all applicable local, state and federal
codes and ordinances, including zoning ordinances. Developer shall also cause the Property to
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meet the current edition of the Model Energy Code published by the Council of American
Building Officials.
400. REHABILITATION COSTS PAID WITH NSP FUNDS.
In those special instances where Rehabilitation Costs will be paid with NSP Funds, the
following procedures shall be followed:
401. Rehabilitation Costs Paid with NSP Funds. It is the intent of the parties to use
NSP funds for acquisition and related soft costs. If there is a need to use NSP funds for
rehabilitation, this section will apply. In the event that NSP Funds will be used for construction
related expenses, Developer must also comply with the labor and Davis-Bacon regulations as set
forth in Section 703 hereof. The documents referenced in this Section 400 (Payment Request,
Release of Retention Funds, Notice of Completion) are attached hereto and incorporated herein
as Exhibit F.
402. Disbursement Requests. The Rehabilitation Portion proceeds shall be disbursed
on a line-item by line-item basis in accordance with the Rehabilitation Budget and subject to the
conditions in this section. In no event shall City have any obligation to disburse any amount for
any item in excess of the amount allocated to such item in the Rehabilitation Budget.
Disbursements shall be made only upon Developer's written request in the form of a
Disbursement Request showing all costs which Developer intends to fund with such
disbursement, itemized in such detail as City may reasonably require, accompanied in each case
by (a) invoices and lien releases satisfactory to City, including in any event partial lien releases
executed by each contractor and subcontractor who has received any payment for work
performed, and (b) all other documents and information reasonably required by City.
Disbursement Requests shall be submitted no less than ten (10) Business Days prior to the date
of the requested disbursement, and shall not be submitted more often than monthly.
Prior to each disbursement by City of proceeds of the NSP Funds, Developer shall deliver to City
and to Bank a draw request ("Draw Request"), and all required supporting information as set
forth in this Agreement or as otherwise reasonably required by City or Bank in order to provide
information for evaluating the requested disbursement pursuant to customary construction
lending practices of institutional lenders in Southern California.
City and Bank shall notify the other and Developer of approval or disapproval of each Draw
Request within five (5) business days after receipt of the Draw Request, using the Bank's
"Disbursement/Change Order Approval Notice". City and Bank shall have the right, but not the
obligation, to discontinue processing Draw Requests unless and until receipt of notification from
the other of approval or disapproval of each outstanding Draw Request.
403. Manner of Disbursement. City may make any disbursement by check payable to
Developer; or on a voucher basis; or by check payable jointly to Developer and any contractor,
subcontractor or other claimant; or directly to any such claimant; or by any other means
reasonably selected by City.
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404. Cost Overruns. In the event that, at any time and for any reason, (a) the actual cost
reasonably estimated by City or Developer to be required to complete all matters included in any
line item in the Rehabilitation Budget exceeds the amount allocated to that line item in the
Rehabilitation Budget, (b) Rehabilitation Costs for any matters not covered by a specific line
item have been or will be incurred, or (c) the undisbursed portion of the Rehabilitation Portion is
or may be insufficient to pay all Rehabilitation Costs that may be payable under this Agreement
or otherwise in connection with the Rehabilitation, Developer shall, within ten (10) days after it
receives written notice thereof from City of any of the foregoing matters, do one or more of the
following:
(a) provide satisfactory evidence to City that Developer has previously paid
such excess or otherwise provided for such insufficiency (collectively, the "Excess Cost") with
funds from a source other than the NSP Funds;
(b) reallocate sufficient funds to pay the Excess Cost from funds
allocated to "Contingency" in the Rehabilitation Budget; provided, however, that the
Executive Director's consent to any such reallocation shall be required; or
(c) deposit an amount equal to the Excess Cost in a non-interest bearing
account (the "Overrun Account") with City from which withdrawals may be made only with the
consent of the Executive Director but which will be exhausted prior to any further disbursement
for any line item, so that any resulting surplus in any line item of the Rehabilitation Budget will
then be reallocated to the line item(s) in which the Excess Costs are expected to be incurred.
City shall have no obligation to make further disbursements until Developer has paid or
otherwise provided for the overrun as required above. Amounts deposited by Developer in the
Overrun Account for any Excess Costs shall be disbursed by City prior to the disbursement of
any remaining Rehabilitation Portion proceeds.
405. Cost Savings. Upon completion of and disbursement for all matters covered by any
line items in the Rehabilitation Budget, any remaining undisbursed amounts allocated to that line
item shall be reallocated to "Contingency" and thereafter be available for disbursement in
accordance with the terms of this Agreement.
406. Retainage. City will withhold a Retainage of 10% from each Disbursement for
each of the Hard Cost line items of the Project Cost Breakdown (and other line items thereof
designated for withholding of retainage) until all conditions to the final Disbursement of Hard
Costs have been satisfied. In lieu of City's withholding Retainage, Developer can by written
notice to City elect not to draw any overhead or profit as would otherwise be permitted under the
Construction Contract until such time as Retainage would otherwise have been released.
City shall not retain funds for building materials purchased by Developer for which Developer
supplies documentation to City proving payment in full or for soft costs.
407. Holdback. The retainage otherwise available for disbursement shall be subject to a
holdback of one hundred twenty-five percent (125%) of the estimated cost (as determined by the
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Executive Director) for "punch-list" items. Such holdback will be released when all punch-list
items have been completed to the satisfaction of City.
408. Waiver of Disbursement Conditions. Unless City otherwise agrees in writing,
the making by City of any disbursement with knowledge that any condition to such disbursement
is not fulfilled shall constitute a waiver of such condition only with respect to the particular
disbursement made, and such condition shall be condition to all further disbursements until
fulfilled.
409. Modification of Disbursement Conditions and Procedures. The Executive
Director shall have the authority to modify the disbursement conditions and procedures set forth
herein in order to conform them to the payment provisions of the Rehabilitation Contract.
500. COVENANTS, RESTRICTIONS, SALE TO HOMEBUYERS
501. Reserved.
502. Selection of Broker by Developer. Developer shall select local real estate
brokers that are most knowledgeable of the market and have a successful track record in the area.
Selection of the broker will be based on criteria such as volume of sales in the area, days on the
market, and comparison of listing price versus sales price, excluding foreclosed properties. The
number of brokers shall be reviewed periodically based on program needs and volume.
503. NSP Assisted Units. Developer agrees to make available, restrict occupancy to,
and sell each of the NSP Assisted Units to Low, Moderate, and/or Middle Income Households
(as that term is herein defined) at an Affordable Housing Cost. In addition, the Developer agrees
to cooperate with the Agency in any subsidized loan program the Agency may in its sole
discretion make available to Low, Moderate, and/or Middle Income Household purchasers of
some or all of the NSP Assisted Units.
504. Sales price.
Single Family Homes: Upon completion, the homes will be marketed and
sold to qualified households at 50 percent or 120 percent of the area median
income, as determined by the City, for the sale amount indicated below. In no
case shall the sales price be greater than the lesser of (a) fair market value or
(b) the total costs to acquire and rehabilitate the property per NSP guidelines.
The City assumes that properties cannot be sold for more than their market
value, regardless of the development costs (acquisition, rehab, other eligible
costs, developer fee). The City expects to reimburse eligible costs that cannot
be recovered from the sale price. Amounts may be amended periodically to
reflect changes in the market.
505. Selection of Buyers. The Developer shall provide the City with a copy of its
Marketing Plan, attached hereto as Exhibit G, which shall set forth how the Developer plans to
provide interested households with information about the NSP Assisted Units. The Developer
shall be solely responsible for the selection of qualified purchasers of the NSP Assisted Units,
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subject to final approval by the City. Developer shall ensure that there will be adequate
homebuyer education with HUD approved pre- purchase counseling. Pre-purchase counseling
must be completed PRIOR to close of escrow.
506. Marketing Plan. The goal of the Marketing Plan is to insure that the marketing of
affordable for-sale housing be as broad and inclusive as possible in order to inform and attract as
many prospective buyers as possible. The Marketing Plan and the associated applicant selection
procedures will be targeted to purchasers regardless of race, color, religion, sex, disability status,
familial status or national origin. The Developer shall report to the City information regarding
efforts taken to comply with this section through the Marketing Efforts Report (Exhibit H) 15
days after the end of each calendar quarter.
Information shall also be provided on the Developer's website, City of Santa Ana
website, City cable channel, Workforce Investment Board, Santa Ana Chamber of Commerce,
Santa Ana Unified School District, Rancho Santiago Community College District, Community
Development Resource Network Newsletter and through neighborhood associations.
507. Verification of Homebuyer Income. Prior to the sale of any NSP Assisted Unit to
a Homebuyer, the Developer shall submit to the City a completed income computation and
certification form from each Homebuyer of the NSP Assisted Unit in the form which is provided
by the City. Each Homebuyer shall certify, to the best of the Homebuyer's knowledge, that it is
a Low, Moderate, and/or Middle Income Household and meets the eligibility requirements
established for the NSP Assisted Unit. The Developer shall obtain an income verification and
lender's packet from the prospective purchaser of an NSP Assisted Unit (which shall be provided
to the City). For purposes of this Program, income will be calculated per HUD guidelines for
federal programs (Exhibit I: HUD Part 5 Income & Assets Definitions). For purposes of such
certification, the Developer shall verify the income certification of the prospective Homebuyer in
one or more of the following methods reasonably acceptable to the City:
(a) obtain three (3) paycheck stubs from the prospective Homebuyer's
three (3) most recent pay periods.
(b) obtain a true copy of an income tax return from the prospective
Homebuyer for the most recent three tax years in which a return was filed.
(c) obtain an income verification certification from the employer of
the prospective Homebuyer.
(d) obtain an income verification certification from the Social Security
Administration and/or the California Department of Social Services if the prospective
Homebuyer receives assistance from such agencies.
(e) obtain an alternate form of income verification reasonably
acceptable to the City, if none of the above forms of verification is available to the Developer.
508. Affordability Documents at Time of Sale. At the closing of escrow for the
Homebuyer's purchase of each NSP Assisted Unit, the City will require each income qualified
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Homebuyer of such Unit to execute the following documents: the Homebuyer Deed of Trust
(attached hereto as Exhibit C), Homebuyer Promissory Note (attached hereto as Exhibit J), and
such further documents reasonably required by the City in a form provided by the City. Any
Units assisted with tax increment money will also have a Notice of Affordability recorded
against such Property (attached hereto as Exhibit K). The Promissory Note, and Deed of Trust
shall contain a forty-five (45) year term. The principal loan amount of the Promissory Note shall
be the amount of NSP Funds to create this homeownership opportunity, which will be
determined based on the affordable sales price, the fair market value or the maximum sales price
permitted under the NSP Program at the time of sale. In those instances where properties have an
appraised Fair Market Value that is greater than the sales price, a silent second will be placed on
the Property for that difference. All principal and interest shall be deferred until subsequent sale
or transfer of the Property. The Deed of Trust will carry a 3% forgivable interest rate, and will
be due and payable in forty-five (45) years. Interest will be forgiven at a rate of 1/45 th per year,
at each anniversary date of the original sale, with all interest forgiven at the end of the forty-five
(45) year affordability period. The covenants and restrictions must be fully explained to each
Homebuyer and the entire explanation and execution of said document must be recorded by the
Developer. A copy of said audio and visual recording shall be placed on a CD/DVD which shall
be kept by the City.
509. Net Sales Proceeds and Distributions. Net sales proceeds shall be applied as
follows:
1. First, to payments required on any acquisition and rehabilitation loan that has been
secured with a first trust deed on the property sold;
2. Second, to the repayment of any equity contribution paid by Developer for the subject
property;
3. Third, to pay for any Cost Overruns that have been approved in writing by the City in
accordance with Section 404, which were unable to be paid with funds from the
acquisition and rehabilitation loan;
4. Fourth, to the Developer Fee, as described in Section 601 to the repayment of the City
loan, less the amount approved as a project subsidy at the time of the City's approval of
the property for acquisition;
5. Fifth, to the repayment of the City Loan, less the amount approved as a project subsidy at
the time of the City's approval of the property for acquisition;
6. Thereafter, if any, to the City.
510. Homebuyer Assistance. The Developer agrees to cooperate with the City in any
subsidized loan program the City and/or Agency may in its sole discretion make available to
Low, Moderate, and/or Middle Income Household purchasers of some or all of the NSP Assisted
Units.
11
? ff - I b
511. Affordable Housing Property Tax. Developer shall be responsible for applying to
the County of Orange to request that the property tax be based on the restricted value with the
affordability covenants that are recorded against each Affordable Unit.
512. Maintenance. The Deed of Trust shall require each of the households to maintain
their property in conformance with local and state requirements.
513. Reasonable Efforts to Sell Affordable Units. The Developer agrees to exercise
reasonable efforts consistent with prudent business practices to sell all of the NSP Assisted Units
to owner-occupants as soon as practical following the completion of the rehabilitation. The
Developer agrees that the NSP Assisted Units shall not be sold to the Developer or any
party/employee related to the Developer.
514. Guarantee/Homeowner Protection Plan. Developer agrees to guarantee its work
from defects for a period of at least one (1) year after rehabilitation is complete, with a five (5)
year guarantee for the roof of each Unit. Developer shall provide each Homebuyer with all of
the manufacturer's warranties and product information. Developer shall also provide the
Homebuyers of each of the Affordable Units with a Homeowner Protection Plan.
515. Subsequent Sales/Recapture of Loan Amount. The Grant Deed from Developer
to any proposed qualified household shall restrict the use of the Property to being owner-
occupied. The Homebuyer Deed of Trust shall be recorded against the property with a term of 45
years. If said NSP Assisted Unit is sold prior to the expiration of the 45 year covenant of
affordability the City must be repaid the full amount of its Promissory Note. Upon transfer and
repayment to the City, the covenant of affordability shall no longer be applicable.
516. Maintenance Covenants. During the time of Developer's ownership of the Sites,
the Developer shall maintain the Sites and all improvements thereon, including all landscaping,
in compliance with the terms of all applicable provisions of the City of Santa Ana Municipal
Code. Each Homebuyer shall be responsible for maintenance of his/her own property after
transfer of title.
517. Nondiscrimination Covenants. Developer herein covenants by and for itself, its
successors and assigns, 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.
600. DEVELOPER FEE AND PERFORMANCE.
601. Developer Fee. The Developer shall be paid ten percent (10%) of the cost of the
acquisition sales price of each property, plus all rehabilitation costs, actual acquisition and sale
closing costs, insurance related to acquisition and rehabilitation, property taxes and maintenance
12
i1b, LWJ-144
costs (utility and landscaping)subject to proper documentation evidencing such costs
("Developer Fee"). The Developer Fee shall be paid by the City to the Developer at the close of
escrow to the qualified homebuyer.
602. Performance Measures. Due to the legislative deadlines, performance
measurements will be monitored closely. The Developer's contract may be cancelled and the
funds reallocated to other developers for failure to meet HUD deadlines.
603. Business License/Professional Licenses. Developer must obtain and maintain a
valid business license in order to perform services in the City of Santa Ana. Also, Developer
shall, throughout the term of this Agreement, maintain all necessary licenses, permits, approvals,
waivers, and exemptions necessary for the provision of the services hereunder and required by
the laws and regulations of the United States, the State of California, the City of Santa Ana and
all other governmental agencies. Developer shall notify the City immediately and in writing of
its inability to obtain or maintain such permits, licenses, approvals, waivers, and exemptions.
Said inability shall be cause for termination of this Agreement.
700. GOVERNMENTAL REQUIREMENTS
701. Economic Opportunities for Low Income People. (24 CFR 570.487, Section 3 of
the Housing and Urban Development Act of 1968, 12 USC 1701 u, as amended by Section 915 of
the Housing and Community Development Act of 1992). Developer certifies that it implements
a policy in accordance with Section 3 of the Housing and Urban Development Act of 1968 that
requires employment and other economic opportunities arising in connection with housing
rehabilitation, housing construction and other public construction projects shall, to the extent
feasible and consistent with existing federal, state and local laws and regulations, be given to low
and very low-income persons. Noncompliance with HUD's regulations in 24 CFR part 135 may
result in sanctions, termination of this contract for default, and debarment or suspension from
future HUD assisted contracts. To the extent applicable, the Developer shall comply and/or
cause compliance with Section 3 Clause requirements for the NSP. For example, when and if
Developer or its contractor(s)/subcontractor(s) hire(s) full time employees, Section 3 is
applicable and all disclosure and reporting requirements apply.
To the maximum extent feasible, the Developer shall provide for the hiring of employees
who reside in the vicinity of the Target area or contract with small businesses that are owned
and/or operated by persons residing in the vicinity of the Target area. The Developer shall report
to the City information regarding efforts taken to comply with this section through the Vicinity
Hiring Report (Exhibit L) 15 days after the end of each calendar quarter.
702. Use of Debarred. Suspended, or Ineligible Participants. Developer shall comply
with the provisions of 24 CFR 24 relating to the employment, engagement of services, awarding
of contracts, or funding of any contractor or subcontractor during any period of debarment,
suspension, or placement in ineligibility status.
703. Conformance with Applicable Labor Law. If Section 401 applies, all laborers
and mechanics employed by the Developer and any subcontractor in the performance of the
13
construction work under this Agreement (if any) shall be paid wages at rates not less than the
prevailing wage as determined by the U.S. Department of Labor, under the Davis-Bacon Act.
The Developer further agrees to comply with the provisions of the Copeland Act and the
Contractor Work Hours and Safety Act. This paragraph does not apply to contracts which do not
exceed $2,000.
704. Maintenance of Drug-Free Workplace. Developer shall certify that Developer
will provide a drug-free workplace in accordance with 24 CFR 84.13.
705. Books and Records. Developer shall maintain complete books of account and
other records, reports and information, as the Executive Director may reasonably require,
reflecting its operations (in connection with any other businesses as well as with respect to the
NSP Assisted Units), in accordance with generally accepted accounting principles applied on a
consistent basis or in accordance with such other principles or methods as are reasonably
acceptable to City, to meet the record keeping and reporting requirements required of it in
accordance with 24 CFR 92.508.
706. Equal Opportunity and Fair Housing. Developer shall carry out the
Rehabilitation and perform its obligations under this Agreement in compliance with all of the
state and federal laws and regulations regarding equal opportunity and fair housing described in
24 CFR 92.350. Developer must also follow the requirements of Health and Safety Code section
33435.
707. Conflict of Interest. Developer shall comply with and be bound by the conflict of
interest provisions set forth at 24 CFR 570.611, as well as state regulations pertaining to conflict
of interest.
708. Program Income. When the City receives repayment from sales of the Properties,
such funds are "Program Income". Program Income received by the City will be used for NSP
activities. Program Income and reallocated funds identified for the single family component will
be added to the Agreement with Developer. Developer agrees to comply fully with all federal,
state, and local laws applicable to its operation whether or not referred to in this Agreement.
800. DEFAULTS, REMEDIES, TERMINATION
801. Default Remedies. Failure by either party to perform any action or covenant
required by this Agreement within the time periods provided herein following notice and failure
to cure as described hereafter, constitutes a "Default" under this Agreement. A party claiming a
Default shall give written notice of Default to the other party specifying the Default complained
of. Except as otherwise expressly provided in this Agreement, the claimant shall not institute
any proceeding against any other party, and the other party shall not be in Default if such party
within thirty (30) days from receipt of such notice immediately, with due diligence, commences
to cure, correct or remedy such failure or delay and shall complete such cure, correction or
remedy with diligence.
802. Institution of Legal Actions. In addition to any other rights or remedies and
subject to the restriction otherwise set forth in this Agreement, either party may institute and
14
?10116 _16
action at law or equity to seek specific performance of the terms of this Agreement, or to cure,
correct or remedy any Default, to recover damages for any Default, or to obtain any other
remedy consistent with the purpose of this Agreement. Such legal actions must be instituted in
the Courts of the County of Orange, State of California, or in the District of the United States
District Court in which such county is located.
803. Rights and Remedies Are Cumulative. Except as otherwise expressly stated in
this Agreement, the rights and remedies of the parties are cumulative, and the exercise by either
party of one or more of such right 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.
804. Inaction Not a Waiver of Default. Any failures or delays by either party in
asserting any of its rights and remedies as to any Default shall not operate as a waiver of any
Default or of any such rights or remedies, or deprive either such party of its right to institute and
maintain any actions or proceedings which it may deem necessary to protect, assert or enforce
any such rights or remedies.
805. Termination. This Agreement shall terminate on the earlier of: (a) expenditure of
all NSP funds; (b) failure to cure a material breach after notice and time to cure; (c) February 1,
2014; (d) the date ninety (90) days following receipt by Developer of written notice of
termination from the City; (e) upon mutual agreement of the parties, or (f) failure to meet
Performance Measures as set forth in Section 602.
900. GENERAL PROVISIONS
901. Relationship between the Parties. Both parties expressly acknowledge it is the
intention of the parties that this Agreement shall be a contract for services and shall not in
any way create any employer/employee relationship between the parties or any co-venture or
joint venture. Developer is an independent contractor who shall in no way be considered an
employee of the City. It is expressly acknowledged and agreed that Developer shall be
responsible for maintaining its own insurance as described in paragraph 906.
902. Notices. Any approval, disapproval, demand, document or other notice ("Notice")
which either party may desire to give to the other party under this Agreement must be in
writing and may be given by any commercially acceptable means to the party to whom the
Notice is directed at the address of the party as set forth below, or at any other address as that
party may later designate by Notice.
To City: City of Santa Ana - Housing Division
20 Civic Center Plaza, M-37
Santa Ana, California 92701
Attention: Executive Director
To Developer: ANR Homes, Inc.
10702 Hathaway Drive, Unit 1
15
?w2i?
Santa Fe Springs, CA 90670
Attention: George Jordan, Vice President
Any written notice, demand or communication shall be deemed received immediate if
delivered by hand and shall be deemed received on the third day from the date it is
postmarked if delivered by registered or certified mail.
903. Modification of Terms. The Executive Director shall have the authority to make
minor modifications to the terms contained herein with the prior approval of the City Attorney's
Office. Any alteration, change or modification of or to this Agreement, in order to become
effective, shall be made in writing and in each instance signed on behalf of each party.
904. Limitation on Delegation. Inasmuch as this Agreement is intended to secure the
specialized services of Developer, Developer may not assign, transfer, delegate, or subcontract
any interest herein without the prior written consent of the City and any such assignment,
transfer, delegation or subcontract without the City's prior written consent shall be considered
null and void. Nothing in this Agreement shall be construed to limit the City's ability to have any
of the services which are the subject to this Agreement performed by City personnel or by other
developers or consultants retained by the City.
905. Exclusivity and Amendment. This Agreement represents the complete and
exclusive statement between the City and Developer, and supersedes any and all other
agreements, oral or written, between the parties. In the event of a conflict between the terms of
this Agreement and any attachments hereto, the terms of this Agreement shall prevail. This
Agreement may not be modified except by written instrument signed by the City and by an
authorized representative of Developer. The parties agree that any terms or conditions of any
purchase order or other instrument that are inconsistent with, or in addition to, the terms and
conditions hereof, shall not bind or obligate Developer nor the City. Each party to this
Agreement acknowledges that no representations, inducements, promises or agreements, orally
or otherwise, have been made by any party, or anyone acting on behalf of any party, which are
not embodied herein.
906. Insurance. The Developer shall take out and maintain or shall cause its contractor
to take out and maintain until the completion of rehabilitation pursuant to the terms of
this Agreement, a commercial general liability policy in the amount of Two Million
Dollars ($2,000,000) combined single limit policy, and a comprehensive automobile
liability policy in the amount of One Million Dollars ($1,000,000), combined single limit,
or such other policy limits as the City may approve at its discretion, including contractual
liability, as shall protect the Developer, City from claims for such damages. Such policy
or policies must be written on an occurrence form. The Developer shall also furnish or
cause to be furnished to the City evidence satisfactory to the City that Developer and any
contractor with whom it has contracted for the performance of work on the Sites or
otherwise pursuant to this Agreement carries workers' compensation insurance as
required by law. Developer also agrees to provide insurance covering one
hundred percent (100%) of the replacement cost of all insurable items within the Property
in the event of fire, lightning, debris removal, windstorm, vandalism, malicious mischief,
theft, mysterious disappearance and hazards, casualties and contingencies as are normally
16
and usually covered by all-risk policies in effect in the locality where the Property is
situated. The Developer shall furnish a certificate of insurance countersigned by an
authorized agent of the insurance carrier on a form approved by the City setting forth the
general provisions of the insurance coverage. This countersigned certificate shall name
the City and its respective officers, agents, and employees as an additionally insured
party under the policy, and the certificates shall be accompanied by a duly executed
enforcement evidencing such additional insured status (the City's preferred Additional
Insured Endorsement is attached hereto as Exhibit M). The certificate and endorsement
by the insurance carrier shall contain a statement of obligation on the part of the carrier to
notify City of any material change, cancellation or termination of the coverage at least
thirty (30) days in advance of the effective date of any such material change, cancellation
or termination. Coverage provided hereunder by the Developer shall be primary
insurance and not be contributing with any insurance maintained by the City, and the
policy shall contain such an endorsement. The insurance policy or the endorsement shall
contain a waiver of subrogation for the benefit of the City. The required certificate shall
be furnished by the Developer at the time this Agreement is executed. Certificates
verifying such coverage has been extended to the City of Santa Ana must be furnished to
the City of Santa Ana City Attorney's Office (M-29), 20 Civic Center Plaza, Santa Ana,
CA 92701 prior to the commencement of work hereunder.
907. Builders Risk Insurance. The Developer shall be responsible to cover the
properties during the course of rehabilitation. It is recommended that such insurance provide
coverage on an all risk basis, including theft and vandalism, for accidental losses, damage or
destruction of the Property until each home is sold.
908. Right of Access. For purposes of assuring compliance with this Agreement,
representatives of the City shall have the right of access to the properties, 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
rehabilitating the improvements so long as City representatives comply with all safety rules. The
City (or its representatives) shall, except in emergency situations, notify the Developer prior to
exercising its right pursuant to this section.
909. Developer Indemnity.
Developer shall indemnify, defend and hold harmless City, its officers, agents, employees and
volunteers from and against any and all loss or damage, expenses, injuries, death to any person,
damage to real or personal property, claim, demand, suit, action, judgment, settlement,
reasonable attorney's fees, costs, or proceeding of any kind arising out of this Agreement,
implementation of this Agreement, the sale of the property by Developer, securing of financing,
design development drawings, engineering, construction, reconstruction, structural integrity of
the NSP Assisted Units, maintenance of the properties, operation, and subsequent sale of the
NSP Assisted Units, including but not limited to:
17
(a) the presence, release, use, generation, discharge, storage or disposal of any hazardous
materials, on, under, in or about, or the transportation of any such hazardous materials to
or from, the NSP Assisted Units;
(b) the violation, or alleged violation, of any statute, ordinance, order, rule, regulation,
permit, judgment or license relating to the use, generation, release, discharge, storage,
disposal or transportation of Hazardous Materials on, under, in or about, to or from, the
NSP Assisted Units;
(c) latent material defects in rehabilitation work;
(d) any construction defect;
(e) personal injury, including death, of the employees, agents, officers, and/or volunteers of
Developer, and/or any subcontractors, independent contractors, partners, and/or
subsidiaries;
(f) property damage claims of the employees, agents, officers, and/or volunteers of
Developer, and/or any subcontractors, independent contractors, partners, and/or
subsidiaries;
(g) delay in rehabilitation;
(h) personal injury, including death, of any third party;
(i) property damage claims of any third party; and
(j) the failure to make required real estate disclosures to subsequent buyers of the NSP
Assisted Units.
Developer's obligation to indemnify as set forth in this Agreement shall extend to loss or
damage, expenses, injuries, death to any person, damage to real or personal property, claim,
demand, suit, action, judgment, settlement, reasonable attorney's fees, costs, or proceedings of
any kind that, are discovered or accrue, either before or after the termination of this Agreement.
Notwithstanding the foregoing, Developer shall not be required to indemnify and hold harmless
the City for liability attributable to the active negligence or intentional misconduct of the City or
any of its boards, officers, employees, representatives or agents.
910. Attorney's Fees. In any action between the parties to interpret, enforce, reform,
modify, rescind, or otherwise in connection with any of the terms or provisions of this
Agreement, the prevailing party in the action shall be entitled, in addition to damages, injunctive
relief, or any other relief to which it might be entitled, reasonable costs and expenses including,
without limitation, litigation costs and reasonable attorneys' fees.
911. Titles and Captions. Titles and captions are for convenience of reference only and
do not define, describe or limit the scope or the intent of this Agreement or of any of its terms.
Reference to section numbers are to sections in this Agreement, unless expressly stated
otherwise.
912. Interpretation. As used in this Agreement, masculine, feminine or neuter gender
and the singular or plural number shall each be deemed to include the others where and when the
context so dictates. The word "including" shall be construed as if followed by the words
"without limitation." This Agreement shall be interpreted as though prepared jointly by both
parties.
18
Z'§b
913. Severability. If any term, provision, condition or covenant of this Agreement or its
application to any party or circumstances shall be held, to any extent, invalid or unenforceable,
the remainder of this Agreement, or the application of the term, provision, condition or covenant
to persons or circumstances other than those as to whom or which it is held invalid or
unenforceable, shall not be affected, and shall be valid and enforceable to the fullest extent
permitted by law.
914. Legal Advice. Each party represents and warrants to the other the following: they
have carefully read this Agreement, and in signing this Agreement, they do so with full
knowledge of any right which they may have; they have received independent legal advice from
their respective legal counsel as to the matters set forth in this Agreement, or have knowingly
chosen not to consult legal counsel as to the matters set forth in this Agreement; and, they have
freely signed this Agreement without any reliance upon any agreement, promise, statement or
representation by or on behalf of the other party, or their respective agents, employees, or
attorneys, except as specifically set forth in this Agreement, and without duress or coercion,
whether economic or otherwise.
915. JurisdictionNenue. This Agreement has been executed in the State of California
and the validity, interpretation, performance, and enforcement of any of the clauses of this
Agreement shall be determined and governed by the laws of the State of California. Both parties
further agree that Orange County, California, shall be the venue for any action or proceeding that
may be brought or arise out of, in connection with or by reason of this Agreement.
916. Miscellaneous.
a. Each undersigned represents and warrants that its signature hereinbelow has the power,
authority and right to bind their respective parties to each of the terms of this Agreement, and shall
indemnify City fully, including reasonable costs and attorney's fees, for any injuries or damages to
City in the event that such authority or power is not, in fact, held by the signatory or is withdrawn.
b. All Exhibits referenced herein and attached hereto shall be incorporated as if fully set
forth in the body of this Agreement.
19
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date and year
first stated above.
ATTEST:
MARIA D. HUIZAR
Clerk of the Council
CITY OF SANTA ANA
PAUL WALTERS
Interim City Manager
APPROVED AS TO FORM:
JOSEPH STRAKA
Interim City Attorney
By: LISA E. STORCK
Assistant City Attorney
DEVELOPER:
ANR HOMES, INC.
By: GEORGE JORDAN
Vice President
20
xj:ffiii?
List of Exhibits
A. NSP 3 Target Area Map
B. Deed of Trust
C. Homebuyer Deed of Trust
D. Housing Rehabilitation Standards
E. Promissory Note
F. Payment Request, Release of Retention Funds, Notice of Completion
G. Marketing Plan
H. Marketing Efforts Report
1. HUD Part 5 Income & Assets Definitions
J. Homebuyer Promissory Note
K. Notice of Affordability
L. Vicinity Hiring Report
M. Additional Insured Endorsement
?W?ii
EXHIBIT A
NSP 3 Target Geography
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EXHIBIT B
FREE RECORDING REQUESTED PURSUANT
TO GOVERNMENT CODE SECTION 27383
When Recorded Mail to:
Community Development Agency
City of Santa Ana
20 Civic Center Plaza (M-37)
P.O. Box 1988
Santa Ana, CA 92702-1988
Telefacsimile (714) 667-2225
Attention: Housing Programs Coordinator
DEED OF TRUST
(INCLUDING AFFORDABLE HOUSING DEED RESTRICTIONS)
THIS DEED OF TRUST is made as of the day of , 2009, by
and between ANR Homes, Inc., a California Corporation or ANR Santa Ana, NSP, LLC
("Trustor"), whose address is , CA ; AmeriNational
Community Services, Inc. (the "Trustee"), whose address is 8121 E. Florence Avenue, Downey,
CA 90240, and the City of Santa Ana, a charter city and municipal corporation (the
"Beneficiary") whose address is 20 Civic Center Plaza (M-37), P.O. Box 1988, Santa Ana,
California 92702.
FOR GOOD AND VALUABLE CONSIDERATION, including the indebtedness
herein recited and the trust herein created, the receipt of which is hereby acknowledged, Trustor
hereby irrevocably grants, transfers, conveys and assigns to Trustee, IN TRUST, WITH POWER
OF SALE, for the benefit and security of Beneficiary, under and subject to the terms and
conditions hereinafter set forth, the property located in the City of Santa Ana, County of Orange,
State of California, that is described in the property description attached hereto as Exhibit A and
by this reference incorporated herein (the "Property").
TOGETHER WITH all issues, profits, royalties, income and other benefits legally
or illegally derived from the Property (collectively, the "issues"), provided that so long as
Trustor is not in default hereunder, it shall be permitted to control the Property in accordance
with the requirements of that certain Neighborhood Stabilization Program Grant Services
Agreement entered into between the Trustor and the Beneficiary, dated , 2009
(the "Agreement"), which Agreement is on file with the Beneficiary as a public record;
TOGETHER WITH all interests, estates or other claims, both in law and in equity
which Trustor now has or may hereafter acquire in the Property and the issues;
TOGETHER WITH all easements, rights-of-way and rights used in connection
therewith or as a means of access thereto, including, without limiting the generality of the
foregoing, all tenements, hereditaments and appurtenances thereof and thereto;
J"BI 6
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EXHIBIT B
TOGETHER WITH any and all buildings and improvements now or hereafter
erected thereon, and all property of the Trustor now or hereafter affixed to or placed upon the
Property, including without limitation, all fixtures, attachments, appliances, furnishings,
equipment and machinery (whether fixed or movable) and other articles (including, in each
instance, improvements, restorations, replacements, repairs, additions, accessions or substitutions
thereto or therefor);
TOGETHER WITH all leasehold estate, right, title and interest of Trustor in and
to all leases or subleases covering the Property or any portion thereof now or hereafter existing
or entered into, and all right, title and interest of Trustor thereunder, including, without
limitation, all cash or security deposits, advance rentals, and deposits or payments of similar
nature;
TOGETHER WITH all right, title and interest of Trustor in and to all options to
purchase or lease the Property or any portion thereof or interest therein, and any greater estate in
the Property owned or hereafter acquired;
TOGETHER WITH all right, title and interest of Trustor, now owned or hereafter
acquired, in and to any land lying within the right-of-way of any street, open or proposed,
adjoining the Property, and any and all sidewalks, alleys and strips and gores of land adjacent to
or used in connection with the Property;
TOGETHER WITH all the estate, interest, right, title, other claim or demand, of
every nature, in and to such property, including the Property, both in law and in equity,
including, but not limited to, all deposits made with or other security given by Trustor to utility
companies, the proceeds from any or all of such property, including the Property, claims or
demands with respect to the proceeds of insurance in effect with respect thereto, which Trustor
now has or may hereafter acquire, any and all awards made for the taking by eminent domain or
by any proceeding or purchase in lieu thereof of the whole or any part of such property,
including without limitation, any awards resulting from a change of grade of streets and awards
for severance damages;
"Security."
All of the foregoing, together with the Property, is herein referred to as the
FOR THE PURPOSE OF SECURING:
(a) Payment of an amount equal to the Loan Amount disbursed to Trustor in
connection with the acquisition, rehabilitation, maintenance, and sale of the Property, as such
terms are defined in the Agreement and the related Promissory Note dated of even date herewith
by the Trustor as maker in favor of the Beneficiary as holder; and
(b) Payment of such additional sums and interest thereon which may hereafter
be loaned to Trustor, or its successors or assigns, by Beneficiary, when evidenced by a
Promissory Note or notes or other document reciting that they are secured by this Deed of Trust;
and
(c) Performance of every obligation, covenant or agreement of Trustor
referenced in the Agreement and Promissory Note; and
4ULBI
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EXHIBIT B
The terms, covenants and restrictions of said Agreement and Promissory Note are
incorporated herein by reference. Any capitalized term not otherwise defined in this Deed shall
have the meaning ascribed to such term in the Agreement.
ARTICLE I. ACQUISITION, REHABILITATION, MAINTENANCE AND
MODIFICATION OF THE PROPERTY
Section 1.01 Acquisition and Rehabilitation.
A. Acquisition. Acquisition of the Property shall follow the procedures set forth in
the Agreement.
B. Commencement of Rehabilitation. The parties agree that if the rehabilitation of the
improvements are not carried on with reasonable diligence after acquisition of the Property,
Beneficiary, after due notice to Trustor or any subsequent owner, is hereby invested with full and
complete authority to protect such improvements from depredation or injury and to preserve and
protect the personal property therein, and to continue any an all outstanding contracts for the
rehabilitation of said building(s), to make and enter into any contracts and obligations wherever
necessary, either in its own name or in the name of Trustor, and to pay and discharge all debts,
obligations and liabilities incurred thereby. All such sums so advanced by Beneficiary shall be
added to the principal of the indebtedness secured hereby and shall be secured by this Deed of
Trust and shall be due and payable on demand.
C. Maintain Property. The Trustor agrees that at all times prior to the date upon which
the Loan Amount has been fully repaid to the Beneficiary and all other obligations the
performance of which is secured by this Deed of Trust have been satisfied (the "Expiration
Date") and the property sold to a qualified Low or Moderate Income Household, the Trustor will,
at the Trustor's own expense, maintain, preserve and keep the Property or cause the Property to
be maintained, preserved and kept in a condition substantially similar to other residential
property similar in size, character, and quality to the Property consisting only of those uses
allowed by the Agreement. The Trustor will make or cause to be made all repairs, replacements
and renewals deemed proper and necessary by Trustor. The Beneficiary shall have no
responsibility in any of these matters or for the making of improvements or additions to the
Property.
D. Protect Against Liens. Trustor agrees to pay fully and discharge (or cause to be paid
fully and discharged) all claims for labor done and for material and services furnished in
connection with the Security, diligently to file or procure the filing of a valid notice of
completion upon completion of construction or any part of the Security, diligently file or procure
the filing of a notice of cessation upon the event of a cessation of labor on the work or
construction on the Security for a continuous period of thirty (30) days or more, and to take all
other reasonable steps to forestall the assertion of claims of lien against the Security or any part
thereof.
Section 1.02 Granting of Easements. Trustor may grant easements, licenses, rights-of-
way or other similar rights or privileges in the nature of easements with respect to any
property or rights included in the Security without the prior written approval of the
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Beneficiary. In the event such rights are granted, the Trustor shall promptly so advise
the Beneficiary in writing.
Article II. DEED RESTRICTIONS/AFFORDABILITY REQUIREMENTS
1. Pu ose. In accepting the Deed Restrictions, the undersigned Trustor
understands and acknowledges that the Property acquisition is being financed, in part, due to a
loan provided by the City of Santa Ana ("City") in accordance with the Agreement so that the
Property can be rehabilitated and sold in accordance with the Neighborhood Stabilization
Program ("NSP") guidelines to a low or moderate income homebuyer. In return for and in
consideration of the opportunity for the Trustor to acquire the Property under the above
referenced circumstances and for other good and valuable consideration, the receipt and legal
sufficiency of which the undersigned hereby acknowledges, the Trustor on behalf of
himself/herself and with the express intent to bind all those defined as "Owner", hereby agrees to
the following:
2. Method of Sale.
A. Procedures to Notify Cites Trustor agrees to make available, restrict
occupancy to, and sell each of the NSP Assisted Units to Low or Moderate Income Households
(as that term is herein defined) at an Affordable Housing Cost. In addition, the Trustor agrees to
cooperate with the City in any subsidized loan program the City may in its sole discretion make
available to Low or Moderate Income Household purchasers of some or all of the NSP Assisted
Units. Trustor shall comply with all sections of the Agreement pertaining to sale of the Units.
B. Disposition of the Subject Property Contrary to Agreement. If the Owner
disposes of the Property contrary to this Deed of Trust, the City shall at any time thereafter, at its
election, have the right to declare such disposition or other act null and void and/or seek
enforcement of the terms and conditions hereof in any manner allowed by law or equity.
3. Terms of Purchase. Upon any sale of the Property, the following provisions shall
govern:
A. Escrow. The Owner acknowledges and agrees that the percentage amount
of any deposit required pending close to escrow shall not exceed that customarily required for
the purchase of residential units in the City of Santa Ana at the time of the escrow. Closing costs
shall be allocated between buyer and seller according to the customary practices in the City of
Santa Ana in effect at the time of an offer to purchase. The Owner shall agree to reasonable
terms of sale which are consistent with promoting the purpose of this Deed of Trust.
B. Condition to Close of Escrow. The escrow instructions may provide for
conditions or contingencies of the type or nature commonly included within residential purchase
escrows (including, but not limited to, financing contingencies, inspection rights, and
preliminary title report approvals) to the obligation of the purchaser to purchase the Property
from the then Owner, provided that any such conditions or contingencies (other than the status of
title to the Property at the time of conveyance and other conditions which by their nature cannot
be satisfied prior to closing) must be satisfied or waived on or before sixty (60) days after the
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opening of an escrow between the Owner and an income qualified purchaser. The purchaser's
qualifications are subject to prior review and approval by the City.
C. Affordable Sales Price. Owner shall have the right to sell the Property to a
low or moderate income household, for an Affordable Sales Price, for use as owner-occupied
housing upon terms and conditions that are mutually acceptable to the City and Owner and in
accordance with the following restrictions:
(a) The term "Affordable Sales Price" shall mean a purchase price
which results in an Affordable Housing Cost to a Low or Moderate Income Purchaser. The
Affordable Housing Cost for Low Income households will be the product of 30% times 65% of
the Area Median Income adjusted for family size appropriate for the unit. For Moderate Income
households, the Affordable Housing Cost will be the product of 35% times 100% of the Area
Median Income, adjusted for family size appropriate for the unit.
(b) Prior to any sale of the Property, Owner shall provide the City with
all income certifications as provided in the Agreement.
(c) At the closing of escrow for the Low or Moderate Income
purchaser's purchase of each NSP Assisted Unit, the City will require each income qualified
homebuyer of such Unit to execute the following documents: the Homebuyer Deed of Trust,
Homebuyer Promissory Note, and Notice of Affordability (as applicable), as well as such further
documents reasonably required by the City in a form provided by the City. The Promissory Note
and Deed of Trust shall contain a forty-five (45) year term. All principal and interest shall be
deferred until subsequent sale or transfer of the Property. The Deed of Trust will carry a 3%
interest rate, and will be due and payable in forty-five (45) years. Interest will be forgiven at a
rate of 1/45 1h per year, at each anniversary date of the original sale, with all interest forgiven at
the end of the forty-five (45) year affordability period. After expiration of the affordability
period, the principal amount of the Note will be paid at transfer or sale. The covenants and
restrictions must be fully explained to each Homebuyer and the entire explanation and execution
of said document must be recorded by the Developer. A copy of said audio/visual recording
shall be placed on a CD which shall be kept by the Developer and the City.
(d) The deed of trust from Owner to any such proposed purchaser shall
restrict the use of the Property to owner occupancy.
4. Severability. The provisions of this Deed of Trust shall be deemed independent
and severable, and a determination of invalidity or partial invalidity or unenforceability of any
one provision or portion hereof by a court of competent jurisdiction shall not affect the validity
or enforceability of any other provisions hereof.
Article III. TAXES AND INSURANCE; ADVANCES
1. Taxes, Other Governmental Charges and Utility Charges. Trustor shall pay, or cause to
be paid, prior to delinquency, all taxes, assessments, charges and levies imposed by any public
authority or utility company which are or may become a lien affecting the Security or any part
thereof; provided, however, that Trustor shall not be required to pay and discharge any such tax,
assessment, charge or levy so long as (a) the legality thereof shall be promptly and actively
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contested in good faith and by appropriate proceedings, and (b) Trustor maintains reserves
adequate to pay any liabilities contested pursuant to the terms hereof, and in accordance with
generally accepted accounting principles. With respect to special assessments or other similar
governmental charges, Trustor shall pay such amount in whole or in installments over a period of
years.
In the event that Trustor shall fail to pay any of the items required by this Section to be paid by
Trustor, Beneficiary may (but shall be under no obligation to) pay the same, after the Beneficiary
has notified the Trustor of such failure to pay and the Trustor fails to fully pay any such item
within seven (7) business days of the earlier of the receipt or mailing of such notice. Any
amount so advanced therefor by Beneficiary, together with interest thereon from the date of such
advance at the maximum rate permitted under Section 1(2) of Article XV of the California
Constitution, shall become an additional obligation of Trustor to the Beneficiary and shall be
secured hereby, and Trustor hereby agrees to pay all such amounts.
2. Provisions Respecting Insurance. Trustor agrees to provide insurance covering one
hundred percent (100%) of the replacement cost of all insurable items within the Property in the
event of fire, lightning, debris removal, windstorm, vandalism, malicious mischief, theft,
mysterious disappearance and hazards, casualties and contingencies as are normally and usually
covered by all-risk policies in effect in the locality where the Property are situated. All such
insurance policies and coverages (i) shall be maintained at Trustor's sole cost and expense so
long as any part of the amounts secured by this Deed of Trust have not been paid, and (ii) shall
be with insurers of recognized responsibility and in form and substance satisfactory to the
Beneficiary, (iii) shall name Beneficiary as additional insured, and (iv) shall contain a provision
to the effect that the insurer shall not cancel the policy or modify it materially and adversely to
the interests of Beneficiary without first giving at least thirty (30) days' prior written notice
thereof. Certificates of insurance for all of the above insurance policies showing the same to be
in full force and effect shall be delivered to the Beneficiary upon demand therefor at any time
prior to the Expiration Date. Should the Property be determined to be in a Flood Zone, Trustor is
required to purchase Flood Insurance for the Property.
Article IV. DAMAGE, DESTRUCTION OR CONDEMNATION
1. Damage and Destruction If, prior to the Expiration Date, the Property or any portion
thereof is destroyed (in whole or in part) or is damaged by fire or other casualty, the Trustor shall
(a) cause any insurance proceeds arising from insurance referred to herein and any other
coverage acquired by the Trustor to be used to promptly rebuild and replace the Property, and (b)
repair and replace the Property as necessary to bring the Property into conformity with the
standards of construction and operation characteristic of residences of size, character, and quality
similar to the Property. There shall be no abatement in, and Trustor shall be obligated to
continue to pay, the amounts payable under the Agreement and this Deed of Trust.
2. Condemnation. If title to or any interest in or the temporary use of the Property or any
part thereof shall be taken under the exercise of the power of eminent domain by any
governmental body or by any person, firm or corporation acting under governmental authority,
including any proceeding or purchase in lieu thereof, the proceeds as a result of such taking shall
be paid as provided by the law of the State of California to all persons or entities as their interests
appear of record.
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Article V. REPRESENTATIONS, COVENANTS AND WARRANTIES OF THE
TRUSTOR
1. Defense of Title. The Trustor covenants that it is lawfully seized and possessed of title in
fee simple to the Property, that it has the right to sell, convey or otherwise transfer or encumber
the same, and that the Trustor, for itself and its successors and assigns, warrants and will forever
defend the right and title to the foregoing described and conveyed property unto the Beneficiary,
its successors and assigns, against the claims of all persons whomsoever, excepting only
encumbrances approved by the Beneficiary.
2. Inspection of the Property. The Trustor covenants and agrees that at any and all
reasonable times and upon reasonable notice, the Beneficiary and its duly authorized agents,
attorneys, experts, engineers, accountants and representatives, shall have the right, without
payment of charges or fees, to inspect the Property.
Article VI. AGREEMENT; FURTHER ASSURANCES; PAYMENT
1. Other Agreements Affecting Property. The Trustor shall duly and punctually perform all
terms, covenants, conditions and agreements binding upon it under the Agreement and this Deed
of Trust or any other agreement of any nature whatsoever now or hereafter involving or affecting
the Property or any part thereof.
2. Further Assurances. At any time, and from time to time, upon request by the
Beneficiary, the Trustor shall make, execute and deliver, or cause to be made, executed and
delivered, to the Beneficiary and, where appropriate, cause to be recorded and/or filed, and from
time to time thereafter to be re-recorded and/or re-filed, at such time and in such offices and
places as shall be deemed desirable by the Beneficiary, any and all such other and further deeds
of trust, security agreements, financing statements respecting personal property, instruments of
further assurance, certificates and other documents as may, in the opinion of the Beneficiary, be
necessary or desirable in order to effectuate, complete or perfect, or to continue and preserve, (a)
the obligations of the Trustor under this Deed of Trust.
3. Agreement to Pay Attorney's Fees and Expenses. In the event of an Event of Default
hereunder, and if the Beneficiary should employ attorneys or incur other expenses for the
collection of amounts due or the enforcement of performance or observance of any obligation or
agreement on the part of the Trustor in this Deed of Trust, the Trustor agrees that it will, on
demand therefor, pay to the Beneficiary the reasonable fees of such attorneys and such other
reasonable expenses so incurred by the Beneficiary; and any such amounts paid by the
Beneficiary shall be added to the indebtedness secured by the lien of this Deed of Trust, and shall
bear interest from the date such expenses are incurred at the maximum rate permitted by Section
1(2) of Article XV of the California Constitution.
4. Payment of the Loan Amount. Upon the sale of the Property, the loan will be transferred
from the Trustor to the qualified Homebuyer. The amount to be repaid shall be the amount of
NSP Funds to create the homeownership opportunity, which will be determined based on the
affordable sales price, the fair market value or the maximum sales price permitted under the NSP
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Program. In those instances where properties have an appraised Fair Market Value that is greater
than the sales price, a silent second will be placed on the Property for that difference.
5. Subrogation: Payment of Claims. Provided that the Beneficiary gives notice of at least
five (5) business days to the Trustor, the Beneficiary shall be subrogated to the claims and liens
of all parties whose claims or liens are discharged or paid by the Beneficiary pursuant to the
provisions hereof.
6. Use of the Property. The Trustor agrees and covenants to require its successors and
assigns to use the Property as their primary residence in full compliance with the Agreement and
Deed of Trust.
7. Transfer. No sale, transfer, lease, pledge, encumbrance, creation of a security interest in
or other hypothecation of the Security shall relieve or release the Trustor from primary liability
under this Deed of Trust or the Agreement.
8. Sale. Upon sale of the Property to a Low or Moderate Income Household, approved by
Beneficiary in accordance with the Agreement, upon repayment to Beneficiary of the Loan
Amount received for the sale of said Property, Beneficiary shall execute a reconveyance of the
lien of this Deed of Trust from the Property.
Article VII. EVENTS OF DEFAULT AND REMEDIES
1. Events of Default Defined. The occurrence of any failure of the Trustor to perform under
the Agreement or this Deed of Trust, and the continuation of said failure for a period of thirty
(30) business days as to monetary obligations and, except as otherwise set forth below, sixty (60)
business days as to non-monetary obligations, after written notice specifying such failure and
requesting that it be remedied (such notice being referred to herein as a "notice of default") shall
have been given to Trustor from the Beneficiary, shall be an Event of Default under this Deed of
Trust. If the default is such that it is not reasonably capable of being cured within sixty (60)
days, and Trustor (i) initiates corrective action within said period, and (ii) diligently 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 the Beneficiary. In
no event shall the 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 notice of default is first given.
2. Acceleration of Maturity. If an Event of Default shall have occurred and be continuing,
then the entire indebtedness secured hereby shall, at the option of the Beneficiary,
immediately become due and payable without notice or demand which are hereby expressly
waived, and no omission on the part of the Beneficiary to exercise such option when entitled
to do so shall be construed as a waiver of such right.
3. The Beneficiary's Right to Enter and Take Possession. If an Event of Default shall have
occurred and be continuing, the Beneficiary may:
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(a) Either in person or by agent, with or without bringing any action or proceeding, or by
a received appointed by a court, and without regard to the adequacy of its security, enter upon
the Property and take possession thereof (or any part thereof) and of any of the Security, in its
own name or in the name of Trustee, and do any acts which it deems necessary or desirable to
preserve the value, marketability or rentability of the Property, or part thereof or interest therein,
increase the income therefrom or protect the Security hereof and, with or without taking
possession of the Property, sue for or otherwise collect any rents, issues and profits thereof,
including those past due and unpaid, and apply the same, less costs and expenses of operation
and collection, including attorneys' fees, upon any indebtedness secured hereby, all in such order
as Beneficiary may determine. The entering upon and taking possession of the Property, the
collection of such rents, issues and profits and the application thereof, as aforesaid, shall not cure
or waive any Event or Default or notice of Event of Default hereunder or invalidate any act done
in response to such Event of Default or pursuant to such notice of Event of Default and,
notwithstanding the continuance in possession of the Property or the collection, receipt and
application of rents, issues or profits, Beneficiary shall be entitled to exercise every right
provided for in this Deed of Trust, the Agreement or by law upon occurrence of any Event of
Default including the right to exercise the power of sale. Trustor requests that a copy of any
notice of default and a copy of any Notice of Sale hereunder be mailed to Trustor at the address
herein given in Section VIII subsection 3;
(b) Commence an action to foreclose this Deed of Trust as a mortgage, appoint a receiver
or specifically enforce any of the covenants hereof;
(c) Deliver to Trustee a written declaration of default and demand for sale, and a written
notice of default and election to cause Trustor's interest in the property to be sold, which notice
Trustee or Beneficiary shall cause to be duly filed for recording in the Official Records of the
County in which the Property is located; or
(d) Exercise all other rights and remedies provided herein, in the instruments by which
the Trustor acquires title to the Property, including any Security, or in any other document or
agreement now or hereafter evidencing, creating or securing all or any portion of the obligations
secured hereby, or provided by law.
4. Foreclosure by Power of Sale. Should the Beneficiary elect to foreclose by exercise of
the power of sale herein contained, the Beneficiary shall notify Trustee and shall deposit with
Trustee this Deed of Trust which is secured hereby (and the deposit of which shall be deemed to
constitute evidence that the Loan Amount is immediately due and payable), and such receipts
and evidence of any expenditures made that are additionally secured hereby as Trustee may
require.
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(a) Upon receipt of such notice from the Beneficiary, Trustee shall cause to be recorded,
published and delivered to Trustor such notice of default and election to sell as then
required by law and by this Deed of Trust. Trustee shall, without demand on Trustor,
after lapse of such time as may then be required by law and after recordation of such
notice of default and after notice of sale having been given as required by law, sell the
Property, at the time and place of sale fixed by it in said notice of sale, either as a whole
or in separate lots or Property or items as Trustee shall deem expedient 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 the time of sale. Trustee shall deliver to such purchaser or
purchasers thereof its good and sufficient deed or deeds conveying the property so sold,
but without any covenant or warrant, express or implied. The recitals in such deed of any
matters or facts shall be conclusive proof of the truthfulness thereof. Any person,
including, without limitation, Trustor, Trustee or Beneficiary, may purchase at such sale,
and Trustor hereby covenants to warrant and defend the title of such purchase or
purchases.
(b) After deducting all reasonable costs, fees and expenses of Trustee, including costs of
evidence of title in connection with such sale, Trustee shall apply the proceeds of sale to
payment of (i) the Loan Amount; (ii) all other sums then secured hereby; and (iii) the
remainder, if any, to the person or persons legally entitled thereto.
(c) Trustee may postpone sale of all or any portion of the Property by public announcement
at such time and place of sale, and from time to time thereafter, and without further notice
make such sale at the time fixed by the last postponement, or may in its discretion, give a
new notice of sale.
5. Receiver. If an Event of Default shall have occurred and be continuing, Beneficiary, as a
matter of right and without further notice to Trustor or anyone claiming under Security, and
without regard to the then value of the Property or the interest of Trustor therein, shall have the
right to apply to any court having jurisdiction to appoint a receive or receivers of the Security (or
a part thereof), and Trustor hereby irrevocably consents to such appointment and waives further
notice of any application therefor. Any such receiver or receivers shall have all the powers and
duties of receivers in like or similar cases, and all the powers and duties of Beneficiary in case of
entry as provided herein, and shall continue as such and exercise all such powers until the date of
confirmation of sale of the Property, unless such receivership is sooner terminated.
6. Remedies Cumulative. No right, power or remedy conferred upon or reserved to the
Beneficiary by this Deed of Trust is intended to be exclusive of any other right, power or
remedy, but each and every such right, power and remedy shall be cumulative and concurrent
and shall be in addition to any other right, power and remedy given hereunder or now or
hereafter existing at law or in equity.
7. Nonrecourse Loan. The indebtedness evidenced hereby is a nonrecourse obligation of
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Trustor. Neither Trustor nor any other party shall have any personal liability for repayment
of such indebtedness. The sole recourse of the Beneficiary under the Promissory Note and
this Deed of Trust for repayment of the indebtedness shall be the exercise of its rights against
the Security. The foregoing shall not: (1) constitute a waiver of any obligation evidenced
by the Promissory Note or this Deed of Trust; (2) limit the right of the Beneficiary to name
Trustor as a party defendant in any action or suit for judicial foreclosure and sale under the
Promissory Note and this Deed of Trust or any action or proceeding hereunder so long as no
judgment in the nature of a deficiency judgment shall be asked for or taken against Trustor;
(3) release or impair the Promissory Note or the lien of this Deed of Trust; (4) 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 other
remedy against the Property or any other instrument securing this Promissory Note or as
prescribed by law or in equity in case of default; (5) 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, its remedies in respect of any deposits,
insurance proceeds, condemnation awards or other monies or other collateral or letters of
credit securing the Promissory Note; (6) relieve Trustor of any of its obligations under any
indemnity delivered by Trustor to the Beneficiary; or (7) affect in any way the validity of any
guarantee from any person of all or any of the obligations evidenced and secured by the
Promissory Note and this Deed of Trust. The foregoing provisions of this paragraph are
limited by the proviso that in the event of the occurrence of an Event of Default beyond
applicable notice and cure periods, 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 revenues, or other
payments or proceeds in respect of the Property, which other revenues, or other payments or
proceeds have not been used for the payment of ordinary and reasonable acquisition costs
and expenses for the Property, operating expenses of the Property, ordinary and reasonable
capital improvements to the Property, debt service on the Promissory Note, real estate taxes
and insurance in respect of the Property, basic management fees, but not incentive fees, costs
and expenses to sell the Property to a Low/Moderate Income Household pursuant to the
terms of the Agreement and all other kinds of costs and expenses set forth in the approved
Project Budget in connection with the acquisition, rehabilitation and sale of the Property,
which are then due and payable. In addition, the Beneficiary may recover directly from
Trustor or any other party:
(a) any damages, costs and expenses incurred by the Beneficiary as a result of
fraud or any criminal act or acts of Trustor or any partner, shareholder, officer, director or
employee of Trustor or of any general or limited partner of Trustor;
(b) any damages, costs and expenses incurred by the Beneficiary as a result of
any misappropriation of funds provided for the construction of the Improvements on the Parcel,
proceeds and revenues from the operation of the Improvements, or proceeds of insurance policies
or condemnation proceeds;
(c) all court costs and attorneys' fees reasonably incurred in enforcing or
collecting upon any of the foregoing exceptions (provided that the Beneficiary shall pay
Trustor's reasonable court costs and attorneys' fees if Trustor is the prevailing party in any such
enforcement or collection action).
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8. No Waiver.
(a) No delay or omission of the Beneficiary to exercise any right, power or
remedy accruing upon any Default shall exhaust or impair any such right, power or remedy, or
shall be construed to be a waiver of any such Default or acquiescence therein; and every right,
power and remedy given by this Deed of Trust to the Beneficiary may be exercised from time to
time and as often as may be deemed expeditious by the Beneficiary. No consent or waiver,
expressed or implied, by the Beneficiary to or of any breach by the Trustor in the performance of
the obligations hereunder shall be deemed or construed to be a consent to or waiver of
obligations of the Trustor hereunder. Failure on the part of the Beneficiary to complain of any
act or failure to act or to declare an Event of Default, irrespective of how long such failure
continues, shall not constitute a waiver by the Beneficiary of its right hereunder or impair any
rights, powers or remedies consequent on any breach or Event of Default by the Trustor.
(b) If the Beneficiary (i) grants forbearance or an extension of time for the
payment of any sums secured hereby, (ii) takes other or additional security or the payment of any
sums secured hereby, (iii) waives or does not exercise any right granted herein, or in the
Agreement, (iv) releases any part of the Security from the lien of this Deed of Trust, or otherwise
changes any of the terms, covenants, conditions or agreements of this Deed of Trust or the
Agreement, (v) consents to the filing of any map, plat or replat affecting the Security, (vi)
consents to the granting of any easement or other right affecting the Security, or (vii) makes or
consents to any agreement subordinating the lien hereof, any such act or omission shall not
release, discharge, modify, change or affect the original liability under this Deed of Trust, or any
other obligation of the Trustor or any subsequent purchaser of the Security or any part thereof, or
any maker, co-signer, endorser, surety or guarantor (unless expressly released); nor shall any
such act or omission preclude the Beneficiary from exercising any right, power, or privilege
herein granted or intended to be granted upon the occurrence of the Event of Default then made
or of any subsequent Event of Default, nor, except as otherwise expressly provided in an
instrument or instruments executed by the Beneficiary shall the lien of this Deed of Trust be
altered thereby. In the event of the sale or transfer by operation of law or otherwise of all or any
part of the Property, the Beneficiary, without notice, is hereby authorized and empowered to deal
with any such vendee or transferee with reference to the Security (or a part thereof) or the
indebtedness secured hereby, or with reference to any of the terms, covenants, conditions or
agreements hereof, as fully and to the same extent as it might deal with the Trustor and without
in any way releasing or discharging any liabilities, obligations or undertakings of the Trustor.
9. Suits to Protect the Security. The Beneficiary shall have power (upon ninety (90) days
notice to the Trustor) to (a) institute and maintain such suits and proceedings as it may deem
expedient to prevent any impairment of the Security (and the rights of the Beneficiary as
secured by this Deed of Trust) by any acts which may be unlawful or any violation of this
Deed of Trust, (b) preserve or protect its interest (as described, in this Deed of Trust) in the
Security and in the rents, issues, profits and revenues arising therefrom, and (c) restrain the
enforcement of or compliance with any legislation or other governmental enactment, rule or
order that may be unconstitutional or otherwise invalid, if the enforcement for compliance
with such enactment, rules or order would impair the security thereunder or be prejudicial to
the interests of the Beneficiary.
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10. Trustee May File Proofs of Claim. In the case of any receivership, insolvency,
bankruptcy, reorganization, arrangement, adjustment, composition or other proceedings
affecting the Trustor, its creditors or its property, the Beneficiary, to the extent permitted by
law, shall be entitled to file such proofs of claims and other documents as may be necessary
or advisable in order to have the claims of the Beneficiary allowed in such proceedings for
the entire amount due and payable by the Trustor under this Deed of Trust at the date of the
institution of such proceedings and for any additional amount which may become due and
payable by the Trustor hereunder after such date.
Article VIII. MISCELLANEOUS
1. Amendments. This instrument cannot be waived, changed, discharged or terminated
orally, but only by an instrument in writing signed by the party against whom enforcement of
any waiver, change, discharge or termination is sought.
2. Reconveyance by Trustee. Upon written request of Beneficiary stating that all sums
secured hereby have been paid or forgiven, and upon surrender of this Deed of Trust to Trustee
for cancellation and retention, and upon payment by Trustor of Trustee's reasonable fees,
Trustee shall reconvey to Trustor, or to the person or persons legally entitle thereto, without
warranty, any portion of the Property then held hereunder. The recitals in such reconveyance of
any matters or facts shall be conclusive proof of the truthfulness thereof. The grantee in any
reconveyance may be described as "the person or persons legally entitled thereto." The
Beneficiary may provide the Trustee with instructions allowing partial reconveyance of the Deed
of Trust if requested by Trustor.
3. Notices. Whenever Beneficiary, Trustor or Trustee shall desire to give or serve any
notice, demand, request or other communication with respect to this Deed of Trust, each such
notice, demand, request or other communication shall be in writing and shall be effective only if
the same is delivered by personal service or mailed by registered or certified mail, postage
prepaid, return receipts requested, or by facsimile transmission, addressed as set forth below.
Any party may at any time change its address for such notices by delivering or mailing to the
other parties hereto, as aforesaid, a notice of such change.
To City: City of Santa Ana - Housing Division
20 Civic Center Plaza, M-37
Santa Ana, California 92701
Attention: Executive Director
To Developer: ANR Homes, Inc.
10702 Hathaway Drive, Unit 1
Santa Fe Springs, CA 90670
Attention: George Jordan, Vice President
4. Acceptance by Trustee. Trustee accepts this Trust when this Deed of Trust, duly
executed and acknowledged, is made a public record as provided by law.
13
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EXHIBIT B
5. Captions. The captions or headings at the beginning of each section hereof are for the
convenience of the parties and are not a part of this Deed of Trust.
6. Invalidity of Certain Provisions. Every provision of this Deed of Trust is intended to be
severable. In the event any term or provision hereof is declared to be illegal or invalid for any
reason whatsoever by a court of competent jurisdiction, such illegality or invalidity shall not
affect the balance of the terms and provisions hereof, which terms and provisions shall remain
binding and enforceable. If the lien of this Deed of Trust is invalid or unenforceable as to any
part of the debt, or if the lien is invalid or unenforceable as to any part of the Security, the
unsecured or partially secured portion of the debt, and all payments made on the debt, whether
voluntary or under foreclosure or other enforcement action or procedure, shall be considered to
have been first paid on and applied to the full payment of that portion of the debt which is not
secured or partially secured by the lien of this Deed of Trust.
7. No Merger. If title to the Property shall become vested in the Beneficiary, this Deed of
Trust and the lien created hereby shall not be destroyed or terminated by application of the
doctrine of merger and, in such event, Beneficiary shall continue to have and enjoy all of the
rights and privileges of Beneficiary under this Deed of Trust. In addition, upon foreclosure
under this Deed of Trust pursuant to the provisions hereof, any leases or subleases then existing
and affecting all or any portion of the Security shall not be destroyed or terminated by
application of the law of merger or as a matter of law or as a result of such foreclosure unless
Beneficiary or any purchaser at any such foreclosure shall so elect. No act by or on behalf of
Beneficiary or any such purchaser shall constitute a termination of any lease or sublease unless
Beneficiary or such purchaser shall give written notice of termination to such tenant or
subtenant.
8. Acceptance of Terms by Owner. By acceptance of this Deed of Trust, the Owner accepts
and agrees to be bound by all of the covenants and restrictions included herein.
9. Governing Law. This Deed of Trust shall be governed by and construed in accordance
with the laws of the State of California.
IN WITNESS WHEREOF, Trustor has executed this Deed of Trust as of the date and year first
above written.
TRUSTOR:
ANR HOMES, INC.
By: GEORGE JORDAN
Vice President
14
Z136
EXHIBIT B
Ho WU -56
EXHIBIT C
FREE RECORDING REQUESTED PURSUANT
TO GOVERNMENT CODE SECTION 27383
When Recorded Mail to:
City of Santa Ana
20 Civic Center Plaza (M-37)
P.O. Box 1988
Santa Ana, CA 92702-1988
Attention: Housing Programs Coordinator
CITY DEED OF TRUST
INCLUDING AFFORDABLE HOUSING
DEED RESTRICTIONS
(Neighborhood Stabilization Program Homeownership Program)
THIS DEED OF TRUST INCLUDING AFFORDABLE HOUSING DEED
RESTRICTIONS is made as of the day of , 20 , by and between
("Trustor"), whose address is Street, Santa Ana, CA
92701; AmeriNational Community Services, Inc. (the"Trustee"), whose address is 8121 E.
Florence Avenue, Downey, CA 90240, and the City of Santa Ana, a charter city and municipal
corporation (the "Beneficiary") whose address is 20 Civic Center Plaza (M-37), P.O. Box 1988,
Santa Ana, California 92702.
FOR GOOD AND VALUABLE CONSIDERATION, including the indebtedness
herein recited and the trust herein created, the receipt of which is hereby acknowledged, Trustor
hereby irrevocably grants, transfers, conveys and assigns to Trustee, IN TRUST, WITH POWER
OF SALE, for the benefit and security of Beneficiary, under and subject to the terms and
conditions hereinafter set forth, the property located at in the City of
Santa Ana, County of Orange, State of California, that is described in the property description
attached hereto as Exhibit A and by this reference incorporated herein (the "Property").
TOGETHER WITH all issues, profits, royalties, income and other benefits legally
or illegally derived from the Property (collectively, the "issues"), provided that so long as
Trustor is not in default hereunder, it shall be permitted to control the Property in accordance
with the requirements contained herein between the Trustor and the Beneficiary ("Deed") and
the Promissory Note ("Note") in the amount of $ which documents are on
file with the Beneficiary as a public record;
TOGETHER WITH all interests, estates or other claims, both in law and in equity
which Trustor now has or may hereafter acquire in the Property and the issues;
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EXHIBIT C
TOGETHER WITH all easements, rights-of-way and rights used in connection
therewith or as a means of access thereto, including, without limiting the generality of the
foregoing, all tenements, hereditaments and appurtenances thereof and thereto;
TOGETHER WITH any and all buildings and improvements now or hereafter
erected thereon, and all property of the Trustor now or hereafter affixed to or placed upon the
Property, including without limitation, all fixtures, attachments, appliances, furnishings,
equipment and machinery (whether fixed or movable) and other articles (including, in each
instance, improvements, restorations, replacements, repairs, additions, accessions or substitutions
thereto or therefor);
TOGETHER WITH all leasehold estate, right, title and interest of Trustor in and
to all leases or subleases covering the Property or any portion thereof now or hereafter existing
or entered into, and all right, title and interest of Trustor thereunder, including, without
limitation, all cash or security deposits, advance rentals, and deposits or payments of similar
nature;
TOGETHER WITH all right, title and interest of Trustor in and to all options to
purchase or lease the Property or any portion thereof or interest therein, and any greater estate in
the Property owned or hereafter acquired;
TOGETHER WITH all right, title and interest of Trustor, now owned or hereafter
acquired, in and to any land lying within the right-of-way of any street, open or proposed,
adjoining the Property, and any and all sidewalks, alleys and strips and gores of land adjacent to
or used in connection with the Property;
TOGETHER WITH all the estate, interest, right, title, other claim or demand, of
every nature, in and to such property, including the Property, both in law and in equity,
including, but not limited to, all deposits made with or other security given by Trustor to utility
companies, the proceeds from any or all of such property, including the Property, claims or
demands with respect to the proceeds of insurance in effect with respect thereto, which Trustor
now has or may hereafter acquire, any and all awards made for the taking by eminent domain or
by any proceeding or purchase in lieu thereof of the whole or any part of such property,
including without limitation, any awards resulting from a change of grade of streets and awards
for severance damages;
All of the foregoing, together with the Property, is herein referred to as the
"Security."
FOR THE PURPOSE OF SECURING:
(a) Performance of every obligation, covenant or agreement of Trustor
referenced in this Deed of Trust, and the Promissory Note ("Note"); and
(b) Maintenance of the term of affordability for low or moderate income
households for at least forty-five (45) years or until the Promissory Note is paid in full, and
(c) The repayment of the sums evidenced by the Promissory Note to the
Beneficiary executed by Trustor of even date herewith
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EXHIBIT C
(d) Use of the Property as an Owner-Occupied, single family residence.
The terms, covenants and restrictions of this Deed and the Promissory Note are incorporated
herein by reference.
ARTICLE I. DEED RESTRICTIONS/AFFORDABILITY REQUIREMENTS
1. Purpose. In accepting these Deed Restrictions, the undersigned Trustor understands
and acknowledges that the Property (also referred to herein as the "Affordable Unit") is being
sold to the Trustor at an affordable sales price, so as to make the Property affordable to the
Trustor. The Owners hereunder are purchasing this Property with a silent second loan from the
Agency through the City of Santa Ana's Neighborhood Stabilization Homeownership Program.
Pursuant to this Program, the City and Owner have agreed to impose certain continuing
obligations relating to and on the Property.
In return for and in consideration of the opportunity for the Trustor to purchase the Property
under the above referenced circumstances and for other good and valuable consideration, the
receipt and legal sufficiency of which the undersigned hereby acknowledges, the Trustor on
behalf of himself/herself and with the express intent to bind all those defined as "Owner", hereby
agrees to the following:
2. Method of Sale.
A. Procedures to Notify City
1. Notice of Proposed Sale. If at any time during the duration of the Forty Five
(45) year affordability period, the Trustor, as Owner, desires or elects to sell, transfer, convey,
assign or otherwise dispose the Property ("dispose"), the Owner may sell it and pay off the City
Promissory Note. Owner is required to notify the City in writing to that effect and shall provide
such information as the City may reasonably require regarding the proposed sale. Said writing
(hereinafter referred to as the "Notice of Intended Sale") shall state the street address of the
Property and the Owner's full name(s). Once the City Promissory Note is paid off completely by
Owner, the long term affordability obligations (45 year restriction) hereunder shall be released.
The Notice, together with the City required information shall be personally delivered or
deposited into the U.S. mail, postage prepaid, first class, certified mail, return receipt requested,
addressed to:
COMMUNITY DEVELOPMENT AGENCY OF
THE CITY OF SANTA ANA
20 Civic Center Drive (M-37)
Santa Ana, California 92702
Attn: Housing Division
B. Notice of Default Under Deed of Trust or Mortgage and City's Right to
Enforce. The Owner covenants to cause to be filed in the Office of the Recorder of the County
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1B141
EXHIBIT C
of Orange a request for a copy of any notice of sale or notice of default under any deed of trust or
mortgage with power of sale encumbering the Property or any party thereof. Such request shall
specify that any such notice shall be mailed to:
COMMUNITY REDEVELOPMENT AGENCY OF
THE CITY OF SANTA ANA
20 Civic Center Drive (M-37)
Santa Ana, California 92702
Attn: Housing Division
C. Disposition of the Property Contra! ty o Agreement. If the Owner disposes
of the Property contrary to this Deed of Trust, the City shall at any time thereafter, at its election,
have the right to declare such disposition or other act null and void and/or seek enforcement of
the terms and conditions hereof in any manner allowed by law or equity.
3. Severability. The provisions of this Deed of Trust, including without limitation,
shall be deemed independent and severable, and a determination of invalidity or partial invalidity
or unenforceability of any one provision or portion hereof by a court of competent jurisdiction
shall not affect the validity or enforceability of any other provisions hereof.
ARTICLE II. GENERAL CONDITIONS/MAINTENANCE
1. Maintenance. The Trustor agrees that at all times prior to the date upon
which the Loan Amount has been fully repaid to the Beneficiary and all other obligations the
performance of which is secured by this Deed of Trust have been satisfied (the "Expiration
Date") the Trustor will, at the Trustor's own expense, maintain, preserve and keep the Property
or cause the Property to be maintained, preserved and kept in a condition substantially similar to
other residential property similar in size, character, and quality to the Property consisting only of
those uses allowed by the Agreement. The Trustor will make or cause to be made all repairs,
replacements and renewals deemed proper and necessary by Trustor. The Beneficiary shall have
no responsibility in any of these matters or for the making of improvements or additions to the
Property. Owner, or its successor or assigns, shall maintain the Property in compliance with all
applicable housing quality standards, and all applicable local code requirements, and shall keep
the Property free from any unreasonable accumulation of debris or waste materials. All graffiti
and defacement of any type, must be removed and any necessary repairs made within five (5)
days of their creation and/or notice to the Owner.
2. Monitoring by the City. On or about July 1 of each calendar year, the City will mail a
form to the record owner of the Property to confirm that the Property is owner-occupied. The
owners of the Property shall complete the form and return it to the City within thirty (30)
calendar days after receipt of the request from the City.
3. Owner Occupancy. The Trustor agrees and covenants to use the Property as its
primary residence in full compliance with this Agreement for Forty-Five (45) years. City and
Owner acknowledge that this owner-occupancy covenant is a condition to and consideration for
Owners eligibility for the Neighborhood Stabilization Program Homeownership Program.
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EXHIBIT C
In administering this Program, the City is implementing the objective of increasing the ratio of
decent, safe and sanitary owner-occupied single-family residences to rental property throughout
the City of Santa Ana. In furtherance of this public use and purpose, Owners for itself and its
successors and assigns, agree not to rent, lease, license or otherwise permit a non-owner of the
Property to take possession and control thereof. Owner and its successors in interest agree and
consent that this owner-occupancy restriction may be enforced by the City through specific
performance.
ARTICLE III. TAXES AND INSURANCE; ADVANCES
1. Taxes, Other Governmental Charges and Utility Charges. Trustor shall pay, or
cause to be paid, prior to delinquency, all taxes, assessments, charges and levies imposed by any
public authority or utility company which are or may become a lien affecting the Security or any
part thereof; provided, however, that Trustor shall not be required to pay and discharge any such
tax, assessment, charge or levy so long as (a) the legality thereof shall be promptly and actively
contested in good faith and by appropriate proceedings, and (b) Trustor maintains reserves
adequate to pay any liabilities contested pursuant to the terms hereof, and in accordance with
generally accepted accounting principles. With respect to special assessments or other similar
governmental charges, Trustor shall pay such amount in whole or in installments over a period of
years.
2. Insurance. Trustor agrees to provide insurance covering one hundred percent
(100%) of the replacement cost of all insurable items within the Property in the event of fire,
lightning, debris removal, windstorm, flood, vandalism, malicious mischief, theft, mysterious
disappearance and hazards, casualties and contingencies as are normally and usually covered by
all-risk policies in effect in the locality where the Property are situated. All such insurance
policies and coverages (i) shall be maintained at Trustor's sole cost and expense so long as any
part of the amounts secured by this Deed of Trust have not been paid, and (ii) shall be with
insurers of recognized responsibility and in form and substance satisfactory to the Beneficiary,
(iii) shall name Beneficiary as additional insured, and (iv) shall contain a provision to the effect
that the insurer shall not cancel the policy or modify it materially and adversely to the interests of
Beneficiary without first giving at least thirty (30) days' prior written notice thereof. Certificates
of insurance for all of the above insurance policies showing the same to be in full force and
effect shall be delivered to the Beneficiary upon demand therefor at any time prior to the
Expiration Date. Should the Property be determined to be in a Flood Zone, Trustor is required to
purchase Flood Insurance for the Property.
ARTICLE IV. DAMAGE, DESTRUCTION OR CONDEMNATION
1. Damage and Destruction If, prior to the Expiration Date, the Property or any portion
thereof is destroyed (in whole or in part) or is damaged by fire or other casualty, the Trustor shall
(a) cause any insurance proceeds arising from insurance referred to herein and any other
coverage acquired by the Trustor to be used to promptly rebuild and replace the Property, and (b)
repair and replace the Property as necessary to bring the Property into conformity with the
standards of construction and operation characteristic of residences of size, character, and quality
similar to the Property. There shall be no abatement in, and Trustor shall be obligated to
continue to pay, the amounts payable under this Deed of Trust.
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EXHIBIT 1
25D-44
EXHIBIT C
2. Condemnation. If title to or any interest in or the temporary use of the Property or any
part thereof shall be taken under the exercise of the power of eminent domain by any
governmental body or by any person, firm or corporation acting under governmental authority,
including any proceeding or purchase in lieu thereof, the proceeds as a result of such taking shall
be paid as provided by the law of the State of California to all persons or entities as their interests
appear of record.
ARTICLE V. REPRESENTATIONS, COVENANTS AND WARRANTIES OF THE
TRUSTOR
1. Defense of Title. The Trustor covenants that it is lawfully seized and possessed of title in
fee simple to the Property, that it has the right to sell, convey or otherwise transfer or encumber
the same, and that the Trustor, for itself and its successors and assigns, warrants and will forever
defend the right and title to the foregoing described and conveyed property unto the Beneficiary,
its successors and assigns, against the claims of all persons whomsoever, excepting only
encumbrances approved by the Beneficiary.
2. Inspection of the Property. The Trustor covenants and agrees that at any and all
reasonable times and upon reasonable notice, the Beneficiary and its duly authorized agents,
attorneys, experts, engineers, accountants and representatives, shall have the right, without
payment of charges or fees, to inspect the Property.
Article VI. AGREEMENT; FURTHER ASSURANCES; PAYMENT
1. Other Agreements Affecting Property. The Trustor shall duly and punctually perform
all terms, covenants, conditions and agreements binding upon it under this Deed of Trust or any
other agreement of any nature whatsoever now or hereafter involving or affecting the Property or
any part thereof.
2. Further Assurances. At any time, and from time to time, upon request by the
Beneficiary, the Trustor shall make, execute and deliver, or cause to be made, executed and
delivered, to the Beneficiary and, where appropriate, cause to be recorded and/or filed, and from
time to time thereafter to be re-recorded and/or re-filed, at such time and in such offices and
places as shall be deemed desirable by the Beneficiary, any and all such other and further deeds
of trust, security agreements, financing statements respecting personal property, instruments of
further assurance, certificates and other documents as may, in the opinion of the Beneficiary, be
necessary or desirable in order to effectuate, complete or perfect, or to continue and preserve, (a)
the obligations of the Trustor under this Deed of Trust.
3. Agreement to Pay Attorney's Fees and Expenses. In the event of an Event of Default
hereunder, and if the Beneficiary should employ attorneys or incur other expenses for the
collection of amounts due or the enforcement of performance or observance of any obligation or
agreement on the part of the Trustor in this Deed of Trust, the Trustor agrees that it will, on
demand therefor, pay to the Beneficiary the reasonable fees of such attorneys and such other
reasonable expenses so incurred by the Beneficiary; and any such amounts paid by the
Beneficiary shall be added to the indebtedness secured by the lien of this Deed of Trust, and shall
bear interest form the date such expenses are incurred at the maximum rate permitted by Section
1(2) of Article XV of the California Constitution.
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EXHIBIT C
4. Payment of the Promissory Note Amount. The Trustor shall pay to the Beneficiary an
amount equal to the Amount of the Promissory Note, in the amount(s) and by the time(s) set out
in the therein. The failure to pay said Amount constitutes an Event of Default under the
Promissory Note authorizing and permitting the Beneficiary to exercise the remedies set forth
herein.
5. Subrogation: Payment of Claims. Provided that the Beneficiary gives notice of at least
five (5) business days to the Trustor, the Beneficiary shall be subrogated to the claims and liens
of all parties whose claims or liens are discharged or paid by the Beneficiary pursuant to the
provisions hereof.
6. Use of the Property. The Trustor agrees and covenants to use the Property as its
primary residence in full compliance with the Agreement until the Termination Date.
7. Transfer. No sale, transfer, lease, pledge, encumbrance, creation of a security interest in
or other hypothecation of the Security shall relieve or release the Trustor from primary liability
under this Deed of Trust or the Agreement.
Article VII. EVENTS OF DEFAULT AND REMEDIES
I . Events of Default Defined. The occurrence of any failure of the Trustor to perform
under this Deed of Trust or the Promissory Note, and the continuation of said failure for a period
of thirty (30) business days as to monetary obligations and sixty (60) business days as to non--
monetary obligations, after written notice specifying such failure and requesting that it be
remedied (such notice being referred to herein as a "notice of default") shall have been given to
Trustor from the Beneficiary, shall be an Event of Default under this Deed of Trust. If the
default is such that it is not reasonably capable of being cured within sixty (60) days, and Trustor
(i) initiates corrective action within said period, and (ii) diligently and in good faith works to
effect a cure as soon as possible, then Trustor shall have additional time as is reasonably
necessary to cure the default prior to exercise of any remedies by the Beneficiary. In no event
shall the 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 notice of default is first given.
2. Acceleration of Maturity. If an Event of Default shall have occurred and be continuing,
then the entire indebtedness secured hereby shall, at the option of the Beneficiary, immediately
become due and payable without notice or demand which are hereby expressly waived, and no
omission on the part of the Beneficiary to exercise such option when entitled to do so shall be
construed as a waiver of such right.
3. The Beneficiary's Right to Enter and Take Possession. If an event of Default shall have
occurred and be continuing, the Beneficiary may:
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?W?4T6
EXHIBIT C
(a) Either in person or by agent, with or without bringing any action or proceeding, or by
a received appointed by a court, and without regard to the adequacy of its security, enter upon
the Property and take possession thereof (or any part thereof) and of any of the Security, in its
own name or in the name of Trustee, and do any acts which it deems necessary or desirable to
preserve the value, marketability or rentability of the Property, or part thereof or interest therein,
increase the income therefrom or protect the Security hereof and, with or without taking
possession of the Property, sue for or otherwise collect any rents, issues and profits thereof,
including those past due and unpaid, and apply the same, less costs and expenses of operation
and collection, including attorneys' fees, upon any indebtedness secured hereby, all in such order
as Beneficiary may determine. The entering upon and taking possession of the Property, the
collection of such rents, issues and profits and the application thereof, as aforesaid, shall not cure
or waive any Event or Default or notice of Event of Default hereunder or invalidate any act done
in response to such Event of Default or pursuant to such notice of Event of Default and,
notwithstanding the continuance in possession of the Property or the collection, receipt and
application of rents, issues or profits, Beneficiary shall be entitled to exercise every right
provided for in this Deed of Trust, the Agreement or by law upon occurrence of any Event of
Default including the right to exercise the power of sale. Trustor requests that a copy of any
notice of default and a copy of any Notice of Sale hereunder be mailed to Trustor at the address
herein given;
(b) Commence an action to foreclose this Deed of Trust as a mortgage, appoint a receiver
or specifically enforce any of the covenants hereof;
(c) Deliver to Trustee a written declaration of default and demand for sale, and a written
notice of default and election to cause Trustor's interest in the property to be sold, which notice
Trustee or Beneficiary shall cause to be duly filed for recording in the Official Records of the
County in which the Property is located; or
(d) Exercise all other rights and remedies provided herein, in the instruments by which
the Trustor acquires title to the Property, including any Security, or in any other document or
agreement now or hereafter evidencing, creating or securing all or any portion of the obligations
secured hereby, or provided by law.
4. Foreclosure by Power of Sale. Should the Beneficiary elect to foreclose by exercise of
the power of sale herein contained, the Beneficiary shall notify Trustee and shall deposit with
Trustee this Deed of Trust which is secured hereby (and the deposit of which shall be deemed to
constitute evidence that the Note Amount is immediately due and payable), and such receipts and
evidence of any expenditures made that are additionally secured hereby as Trustee may require.
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25D-47
EXHIBIT C
Upon receipt of such notice from the Beneficiary, Trustee shall cause to be
recorded, published and delivered to Trustor such notice of default and
election to sell as then required by law and by this Deed of Trust. Trustee
shall, without demand on Trustor, after lapse of such time as may then be
required by law and after recordation of such notice of default and after
notice of sale having been given as required by law, sell the Property, at
the time and place of sale fixed by it in said notice of sale, either as a
whole or in separate lots or Property or items as Trustee shall deem
expedient 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
the time of sale. Trustee shall deliver to such purchaser or purchasers
thereof its good and sufficient deed or deeds conveying the property so
sold, but without any covenant or warrant, express or implied. The recitals
in such deed of any matters or facts shall be conclusive proof of the
truthfulness thereof. Any person, including, without limitation, Trustor,
Trustee or Beneficiary, may purchase at such sale, and Trustor hereby
covenants to warrant and defend the title of such purchase or purchases.
ii. After deducting all reasonable costs, fees and expenses of Trustee,
including costs of evidence of title in connection with such sale, Trustee
shall apply the proceeds of sale to payment of (i) the Note Amount;(ii) all
other sums then secured hereby; and (iii) the remainder, if any, to the
person or persons legally entitled thereto.
iii. Trustee may postpone sale of all or any portion of the Property by public
announcement at such time and place of sale, and from time to time
thereafter, and without further notice make such sale at the time fixed by
the last postponement, or may in its discretion, give a new notice of sale.
5. Receiver. If an Event of Default shall have occurred and be continuing, Beneficiary, as a
matter of right and without further notice to Trustor or anyone claiming under Security, and
without regard to the then value of the Property or the interest of Trustor therein, shall have the
right to apply to any court having jurisdiction to appoint a receive or receivers of the Security (or
a part thereof), and Trustor hereby irrevocably consents to such appointment and waives further
notice of any application therefor. Any such receiver or receivers shall have all the powers and
duties of receivers in like or similar cases, and all the powers and duties of Beneficiary in case of
entry as provided herein, and shall continue as such and exercise all such powers until the date of
confirmation of sale of the Property, unless such receivership is sooner terminated.
6. Remedies Cumulative. No right, power or remedy conferred upon or reserved to the
Beneficiary by this Deed of Trust is intended to be exclusive of any other right, power or
remedy, but each and every such right, power and remedy shall be cumulative and concurrent
and shall be in addition to any other right, power and remedy given hereunder or now or
hereafter existing at law or in equity.
7. No Waiver.
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25D-48
EXHIBIT C
a. No delay or omission of the Beneficiary to exercise any right, power or remedy
accruing upon any Default shall exhaust or impair any such right, power or remedy, or shall
be construed to be a waiver of any such Default or acquiescence therein; and every right,
power and remedy given by this Deed of Trust to the Beneficiary may be exercised from time
to time and as often as may be deemed expeditious by the Beneficiary. No consent or waiver,
expressed or implied, by the Beneficiary to or of any breach by the Trustor in the performance
of the obligations hereunder shall be deemed or construed to be a consent to or waiver of
obligations of the Trustor hereunder. Failure on the part of the Beneficiary to complain of any
act or failure to act or to declare an Event of Default, irrespective of how long such failure
continues, shall not constitute a waiver by the Beneficiary of its right hereunder or impair any
rights, powers or remedies consequent on any breach or Event of Default by the Trustor.
b. If the Beneficiary (i) grants forbearance or an extension of time for the payment of any
sums secured hereby, (ii) takes other or additional security or the payment of any sums
secured hereby, (iii) waives or does not exercise any right granted herein, (iv) releases any
part of the Security from the lien of this Deed of Trust, or otherwise changes any of the terms,
covenants, conditions or agreements of this Deed of Trust, (v) consents to the filing of any
map, plat or replat affecting the Security, (vi) consents to the granting of any easement or
other right affecting the Security, or (vii) makes or consents to any agreement subordinating
the lien hereof, any such act or omission shall not release, discharge, modify, change or affect
the original liability under this Deed of Trust, or any other obligation of the Trustor or any
subsequent purchaser of the Security or any part thereof, or any maker, co-signer, endorser,
surety or guarantor (unless expressly released); nor shall any such act or omission preclude
the Beneficiary from exercising any right, power, or privilege herein granted or intended to be
granted upon the occurrence of the Event of Default then made or of any subsequent Event of
Default, nor, except as otherwise expressly provided in an instrument or instruments executed
by the Beneficiary shall the lien of this Deed of Trust be altered thereby. In the event of the
sale or transfer by operation of law or otherwise of all or any part of the Property, the
Beneficiary, without notice, is hereby authorized and empowered to deal with any such
vendee or transferee with reference to the Security (or a part thereof) or the indebtedness
secured hereby, or with reference to any of the terms, covenants, conditions or agreements
hereof, as fully and to the same extent as it might deal with the Trustor and without in any
way releasing or discharging any liabilities, obligations or undertakings of the Trustor.
8. Suits to Protect the Security. The Beneficiary shall have power (upon ninety (90) days
notice to the Trustor) to (a) institute and maintain such suits and proceedings as it may deem
expedient to prevent any impairment of the Security (and the rights of the Beneficiary as secured
by this Deed of Trust) by any acts which may be unlawful or any violation of this Deed of Trust,
(b) preserve or protect its interest (as described, in this Deed of Trust) in the Security and in the
rents, issues, profits and revenues arising therefrom, and (c) restrain the enforcement of or
compliance with any legislation or other governmental enactment, rule or order that may be
unconstitutional or otherwise invalid, if the enforcement for compliance with such enactment,
rules or order would impair the security thereunder or be prejudicial to the interests of the
Beneficiary.
9. Trustee May File Proofs of Claim. In the case of any receivership, insolvency,
City.HO.DOT Page 10 of 13 2/8/10
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EXHIBIT C
bankruptcy, reorganization, arrangement, adjustment, composition or other proceedings affecting
the Trustor, its creditors or its property, the Beneficiary, to the extent permitted by law, shall be
entitled to file such proofs of claims and other documents as may be necessary or advisable in
order to have the claims of the Beneficiary allowed in such proceedings for the entire amount
due and payable by the Trustor under this Deed of Trust at the date of the institution of such
proceedings and for any additional amount which may become due and payable by the Trustor
hereunder after such date.
Article VIII. MISCELLANEOUS
1. Amendments. This instrument cannot be waived, changed, discharged or terminated
orally, but only by an instrument in writing signed by the party against whom enforcement of
any waiver, change, discharge or termination is sought.
2. Reconve ay nce by Trustee. Upon written request of Beneficiary stating that all sums
secured hereby have been paid, and upon surrender of this Deed of Trust to Trustee for
cancellation and retention, and upon payment by Trustor of Trustee's reasonable fees, Trustee
shall reconvey to Trustor, or to the person or persons legally entitled thereto, without warranty,
any portion of the Property then held hereunder. The recitals in such reconveyance of any
matters or facts shall be conclusive proof of the truthfulness thereof. The grantee in any
reconveyance may be described as "the person or persons legally entitled thereto." The
Beneficiary may provide the Trustee with instructions allowing partial reconveyance of the Deed
of Trust if requested by Trustor.
3. Notices. Whenever Beneficiary, Trustor or Trustee shall desire to give or serve any
notice, demand, request or other communication with respect to this Deed of Trust, each such
notice, demand, request or other communication shall be in writing and shall be effective only if
the same is delivered by personal service or mailed by registered or certified mail, postage
prepaid, return receipts requested, or by telecopier or facsimile transmission, addressed to the
address set forth below. Any party may at any time change its address for such notices by
delivering or mailing to the other parties hereto, as aforesaid, a notice of such change.
To Beneficiary: City of Santa Ana
Housing Division
20 Civic Center Plaza, M-37
Santa Ana, California 92701
Attention: Deputy City Manager of Development Services
4. Acceptance by Trustee. Trustee accepts this Trust when this Deed of Trust, duly
executed and acknowledged, is made a public record as provided by law.
5. Captions. The captions or headings at the beginning of each section hereof are for the
convenience of the parties and are not a part of this Deed of Trust.
6. Invalidity of Certain Provisions. Every provision of this Deed of Trust is intended to be
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EXHIBIT
EXHIBIT C
severable. In the event any term or provision hereof is declared to be illegal or invalid for any
reason whatsoever by a court of competent jurisdiction, such illegality or invalidity shall not
affect the balance of the terms and provisions hereof, which terms and provisions shall remain
binding and enforceable. If the lien of this Deed of Trust is invalid or unenforceable as to any
part of the debt, or if the lien is invalid or unenforceable as to any part of the Security, the
unsecured or partially secured portion of the debt, and all payments made on the debt, whether
voluntary or under foreclosure or other enforcement action or procedure, shall be considered to
have been first paid on and applied to the full payment of that portion of the debt which is not
secured or partially secured by the lien of this Deed of Trust.
7. No Merger. If title to the Property shall become vested in the Beneficiary, this Deed of
Trust and the lien created hereby shall not be destroyed or terminated by application of the
doctrine of merger and, in such event, Beneficiary shall continue to have and enjoy all of the
rights and privileges of Beneficiary under this Deed of Trust. In addition, upon foreclosure
under this Deed of Trust pursuant to the provisions hereof, any leases or subleases then existing
and affecting all or any portion of the Security shall not be destroyed or terminated by
application of the law of merger or as a matter of law or as a result of such foreclosure unless
Beneficiary or any purchaser at any such foreclosure shall so elect. No act by or on behalf of
Beneficiary or any such purchaser shall constitute a termination of any lease or sublease unless
Beneficiary or such purchaser shall give written notice of termination to such tenant or
subtenant.
8. Acceptance of Terms by Owner. By acceptance of this Deed of Trust, the Trustor
accepts and agrees to be bound by all of the covenants and restrictions included herein.
9. Governing Law. This Deed of Trust shall be governed by and construed in accordance
with the laws of the State of California.
10. Non-Discrimination. Trustor herein covenants by and for itself, its successors and
assigns, 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.
IN WITNESS WHEREOF, Trustor has executed this Deed of Trust as of the date and year first
above written.
By:
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EXHIBIT 1
25D-51
EXHIBIT C
EXHIBIT A
LEGAL DESCRIPTION
Real property in the City of Santa Ana, County of Orange, State of California, described as follows:
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25D-52
EXHIBIT D
NSP REHABILITATION STANDARDS
PREFACE
The primary purpose of these standards is to address the quality of workmanship and materials expected,
and to achieve consistency throughout the NSP3 program activities administered by the City of Santa Ana.
These standards are not intended to reduce or exclude the requirements of any federal, state or local
codes, standards, ordinances and regulations that apply to residential rehabilitation.
WORKMANSHIP
All work shall be performed in a professional and workmanlike manner.
The quality and durability of the work shall meet or exceed the standards established by
the construction industry and various trades.
MATERIALS & EQUIPMENT
• All materials and equipment shall comply with and be installed in accordance with the
manufacturer's requirements and all applicable codes, standards, ordinances and
regulations. If a discrepancy occurs between the requirements, the more stringent shall
prevail.
• Unless otherwise specified, all materials and equipment shall be medium grade.
• Economy grade materials and equipment are unacceptable.
• All materials and equipment shall be new, in excellent condition, and delivered to the job
in the manufacturer's original packaging.
• The description of materials and equipment found in this document establish a minimum
standard.
ENERGY EFFICIENCY, WATER CONSERVATION & RECYCLED MATERIALS
To the extent possible and practical, standard measures related to energy conservation, energy efficiency,
water conservation and the use of recycled materials have been incorporated herein. Gut rehabilitation or
new construction of residential buildings up to three stories will be designed to meet the standard for
Energy Star Qualified New Homes. Gut rehabilitation or new construction of mid or high rise multi-family
housing must be designed to meet the American Society of heating, Refrigerating and Air-Conditioning
Engineers (ASHRAE) Standard 90.1-2004, Appendix G plus 20 percent.
LEAD-BASED PAINT
All housing built before 1978 must comply with 24 CFR Part 35 Subpart J and HUD's Lead Safe Housing
Rule regarding the evaluation and control of lead-based paint hazards. HUD's guidelines are available at
http://www.hud.gov/offices/lead/lbp/hudguidelines /index cfm.
BUILDING STANDARDS
Minimum Standard • The site shall be hazard-free and sanitary.
• The site and all paving shall drain away from the dwelling and
accessory buildings.
• Paving and walkways shall be hazard-free and intact.
• Landscaping and irrigation systems shall be hazard-free and in
relatively good condition. All dead vegetation shall be removed.
• Fencing, walls and gates hazard-free and intact. All gates shall be in
EXHIBIT 1
25D-53
EXHIBIT D
good working order.
• The site shall be free from trash, debris and hazardous materials.
• Accessory buildings shall be safe and sound.
Paving . All new paving and walkways shall be constructed with concrete
(2,000 PSI @ 28 days).
• Driveways shall be reinforced with wire mesh. Sawn expansion-
contraction joints shall be placed every 8 feet in both directions.
• All paving and walkways shall be finished with a light broom texture.
• All walkways shall be at least 3 feet wide. Sawn expansion-
contraction joints shall be placed eve 4 feet.
Landscaping & Irrigation • To the extent possible and practical all new landscaping shall be
drought resistant.
• When a lawn is being replaced, the new lawn area shall be reduced
to aid in the reduction of water consumption.
• New irrigation controllers shall be weather or sensor based and EPA
Water-Sense qualified.
• All new irrigation systems shall be designed to conserve water.
Fences, Walls & Gates • All new wood fences shall be made from good quality materials.
They shall be properly supported with 4X4 pressure treated posts (8 feet
O.C.) and 2X4 rails (top and bottom). The posts shall be embedded in a
concrete footing at least 18" deep.
• All new block walls shall be constructed with 6X8X16 concrete block.
They shall be properly supported by a continuous footing and reinforced
with steel bar.
Minimum Standard • Safe and structural) sound.
Rehabilitation • Porches, steps, balconies and railing that do not meet the minimum
standard shall be replaced. Practical, cost effective repairs are
acceptable as long as compliance with the minimum standard will be
achieved.
Concrete • 2,000 PSI (minimum).
Finishes • Zero or low VOC primers, paint and coatinas.
Minimum Standard • Safe and structurally sound.
Rehabilitation Foundations that do not meet the minimum standard shall be
replaced. Practical, cost effective repairs are acceptable as long as
compliance with the minimum standard will be achieved.
• If the project involves a gut rehab, raised foundations shall be
complete) insulated.
Concrete • 2,000 PSI (minimum).
Minimum Standard Safe, structural) sound and weather-tight.
Rehabilitation • Exterior walls that do not meet the minimum standard shall be
replaced. Practical, cost effective repairs are acceptable as Iona as
EXHIBIT 1
2501-54
EXHIBIT D
compliance with the minimum standard will be achieved.
• Seal all joints.
• If the project involves a gut rehab, all exterior walls shall be
insulated.
EXTERIOR DOORS
Minimum Standard Safe, sound, weather-tight and in good working order.
• Five or more ears of practical utility.
Rehabilitation • Exterior doors that do not meet the minimum standard shall be
replaced. Practical, cost effective repairs are acceptable as long as
compliance with the minimum standard will be achieved.
New Doors • EPA Energy Star qualified, zero or low VOC finish.
New Hardware Reputable manufacturer, lifetime finish.
Minimum Standard • Safe, sound and in good working order.
• Five or more ears of practical utility.
Rehabilitation • Garage doors that do not meet the minimum standard shall be
replaced. Practical, cost effective repairs are acceptable as long as
compliance with the minimum standard will be achieved.
Minimum Standard • Safe, sound, weather-tight and in good working order.
• Five or more ears of practical utility.
Rehabilitation Windows that do not meet the minimum standard shall be
replaced. Practical, cost effective repairs are acceptable as long as
compliance with the minimum standard will be achieved.
New Windows Reputable manufacturer.
• EPA Energy Star qualified.
Minimum Standard • Homes built before 1978 must comply with 24 CFR Part 35 Subpart J
and HUD's Lead Safe Housing Rule regarding the evaluation and control
of lead-based paint hazards.
• All exterior paint shall be intact and corrosion free.
• Five or more years of practical utility.
Rehabilitation • All surfaces to be painted shall be prepared properly. All loose
material and peeling paint shall be removed.
• All holes and cracks shall be filled and finished so that they blend
into the surrounding area.
• All stucco surfaces to be painted shall receive a complete and even
coverage of stucco paint.
• All wood surfaces to be painted shall receive a complete and even
coverage of flat exterior paint.
• Poor workmanship will not be tolerated.
New Paint Reputable manufacturer.
• Highest quality available.
2501-55
EXHIBIT D
• Zero or low VOC paint, caulking and fillers.
Minimum Standard • Safe and structurally sound.
• All plaster, drywall and paneling shall be safe and intact.
Rehabilitation Walls, floors and ceilings that do not meet the minimum standard
shall be replaced. Practical, cost effective repairs are acceptable as long
as compliance with the minimum standard will be achieved.
• If the project involves a gut rehab, the attic, walls and floor on raised
foundations shall be insulated.
FLOOR COVERINGS
Minimum Standard • Safe, sound and sanitary.
• Five or more ears of practical utility.
Rehabilitation • Floor coverings that do not meet the minimum standard shall be
replaced. Practical, cost effective repairs are acceptable as long as
compliance with the minimum standard will be achieved.
Replacement Floor Carpet & Pad (Reputable manufacturer, recycled materials).
Coverings • Resilient Flooring (Reputable manufacturer, 10 year wear warranty).
• Ceramic Tile (Reputable manufacturer)
INTERIOR DOORS
Minimum Standard • Safe, sound and in good working order.
• Five or more ears of practical utility.
Rehabilitation • Interior doors that do not meet the minimum standard shall be
replaced. Practical, cost effective repairs are acceptable as long as
compliance with the minimum standard will be achieved.
Replacement Doors & • Doors (Reputable manufacturer, masonite, raised panel).
Hardware Hardware (Reputable manufacturer, lifetime finish).
Minimum Standard • Homes built before 1978 must comply with 24 CFR Part 35 Subpart J
and HUD's Lead Safe Housing Rule regarding the evaluation and control
of lead-based paint hazards.
• All interior paint shall be intact, corrosion-free and sanitary.
• Five or more years of practical utility.
Rehabilitation • All surfaces to be painted shall be prepared properly. All loose
material and peeling paint shall be removed.
• All holes and cracks shall be filled and finished so that they blend
into the surrounding area.
• All surfaces to be painted shall receive a complete and even
coverage of flat paint (semi-gloss in kitchens, bathrooms and laundry
rooms).
• Poor workmanship will not be tolerated.
New Paint • Reputable manufacturer.
• Highest quality available.
• Zero or low VOC paint, caulkinq and fillers.
EXHIBIT 1
2501-56
EXHIBIT D
KITCHEN CABINETS & COUN TER TOPS
Minimum Standard • Cabinets shall be safe, sound, sanitary and in good working order.
• Countertops shall be safe, sound, sanitary and watertight.
• Five or more ears of practical utility.
Rehabilitation • Cabinets and countertops that do not meet the minimum standard
shall be replaced. Practical, cost effective repairs are acceptable as long
as compliance with the minimum standard will be achieved.
Replacement Cabinets • Reputable manufacturer.
• Solid hardwood face-frames, door-frames and drawer fronts.
• Metal and nylon drawer guides.
• Low or zero VOC adhesives and finishes.
Replacement • Reputable manufacturer.
Countertops • 4" ceramic tile, 6" backsplash, bull-nose edge.
KITCHEN FIXTURES, EQUIP MENT & APPLIANCES
Minimum Standard • Safe, sound, sanitary and in good working order.
• Faucets shall (at a minimum) be equipped with a low-flow aerator.
• Five or more years of practical utility.
Rehabilitation . Kitchen fixtures, equipment and appliances that do not meet the
mi nimum standard shall be replaced. Practical, cost effective repairs are
acceptable as long as compliance with the minimum standard will be
achieved.
Replacement Sinks • Reputable manufacturer.
• 18- ua a (minimum) stainless steel.
Replacement Faucets • EPA Water-Sense qualified.
• Reputable manufacturer.
• Brass construction, metal housing.
Replacement Disposals Reputable manufacturer.
• 1/2 HP motor (minimum).
• Stainless steel swivel lugs.
Replacement EPA Energy Star qualified.
Dishwashers • Reputable manufacturer.
Replacement Range EPA Energy Star qualified.
Hoods • Reputable manufacturer.
Replacement Ranges • Reputable manufacturer.
• Pilot-free ignition.
• Four sealed burners.
• Self-cleaning oven with timer.
Replacement Cook Tops • Reputable manufacturer.
• Pilot-free ignition.
• Four sealed burners.
Wall Ovens • Reputable manufacturer.
• Pilot-free ignition.
• Self-cleaningoven with timer.
BATHROOM FIXTURES & EQUIPMENT
EXHIBIT 1
2501-57
EXHIBIT D
Minimum Standard • Safe, sound, sanitary and in good working order.
• Faucets shall (at a minimum) be equipped with a low-flow aerator.
• Showerheads shall (at a minimum) be equipped with low-flow
ae rator.
• Porcelain sinks shall be free from any cracks or chips.
• Steel sinks shall be free from any rust or corrosion.
• Five or more ears of practical utility.
Rehabilitation • Bathroom fixtures and equipment that do not meet the minimum
standard shall be replaced. Practical, cost effective repairs are
acceptable as long as compliance with the minimum standard will be
ac hieved.
• Toilets that require more than 1.6 GPF shall be replaced regardless
of their condition.
Replacement Sinks • Reputable manufacturer.
• Cast iron, white enamel finish.
Replacement Faucets • EPA Water-Sense qualified.
• Reputable manufacturer.
• Brass construction, metal housing.
Replacement Toilets • Reputable manufacturer.
• EPA Water-Sense qualified (1.28 GPF)
Replacement Tubs • Reputable manufacturer.
• Cast iron body, white enamel finish, slip resistant bottom.
• EPA Water-Sense qualified plumbing fixtures.
Replacement • Reputable manufacturer.
Combination • Cast iron body, white enamel finish, slip resistant bottom.
Tub-Showers • 4" ceramic tile surround.
• Anodized aluminum doors with tempered glass.
• EPA Water-Sense qualified plumbing fixtures.
Replacement Showers • Reputable manufacturer.
• 4" ceramic tile.
• Anodized aluminum door with tempered glass.
• EPA Water-Sense qualified plumbing fixtures.
Replacement • Reputable manufacturer.
Medicine Cabinets • Steel body, beveled mirror door.
Towel Bars & Toilet • Reputable manufacturer.
Paper Holders • Metal construction, polished chrome finish.
Minimum Standard Safe, sound and leak-free.
Rehabilitation • Piping (supply, waste and vent) that does not meet the minimum
standard shall be replaced. Practical, cost effective repairs are
acceptable as long as compliance with the minimum standard will be
achieved.
Replacement Copper, type "L".
Water Suppl Piping
Replacement Schedule 40 ABS.
Waste & Vent Pipina
EXHIBIT 1
25D-58
EXHIBIT D
WATER HEATERS
Minimum Standard • Safe, sound and in good working order.
• Five or more ears of practical utility.
Rehabilitation • Water heaters that do not meet the minimum standard shall be
replaced. Practical, cost effective repairs are acceptable as long as
compliance with the minimum standard will be achieved.
Replacement • Reputable manufacturer.
Water Heaters (Tank) • EPA Energy Star qualified.
• 40-gallon insulated tank.
Replacement • Reputable manufacturer.
Water Heater • EPA Energy Star qualified.
(Tank-Less)
ELECTRICAL SERVICE A ND WIRING
Minimum Standard • Safe, sound and in good working order.
• 100-ampere minimum service.
Rehabilitation Electrical service panels, breakers and wiring that do not meet the
minimum standard shall be replaced. Practical, cost effective repairs are
acceptable as long as compliance with the minimum standard will be
achieved.
• Knob and tube wiring shall be replaced regardless of its condition.
• Overhead wiring from a dwelling to a detached garage or accessory
building shall be installed underground regardless of its condition.
Replacement • Reputable manufacturer.
Service • 100-ampere (minimum).
Replacement Romex (NM cable).
Wiring
Minimum Standard • Safe, sound and in good working order.
• Light fixtures shall (at a minimum) be equipped with CFL bulbs.
• Exterior lighting fixtures used for security shall be equipped with a
motion sensor.
Rehabilitation Electrical switches, outlets and lighting fixtures that do not meet the
minimum standard shall be replaced. Practical, cost effective repairs are
acceptable as long as compliance with the minimum standard will be
achieved.
• All new light fixtures shall be U.L. approved and Energy Star
qualified.
• Outlets located within 6 feet of a source of water shall be ground
fault protected.
• Exterior switches and outlets shall be weatherproof.
Replacement U.L. approved.
Switches & Outlets
Replacement Reputable manufacturer.
Lighting Fixtures • U.L. approved and EPA Enerav Star aualified.
EXHIBIT
EXHIBIT D
HVAC
Minimum Standard . Safe, sound and in good working order.
• Eight or more ears of practical utility.
Rehabilitation . HVAC that does not meet the minimum standard shall be replaced.
Practical, cost effective repairs are acceptable as long as compliance with
the minimum standard will be achieved.
• Tune-up all HVAC equipment (as a minimum).
• Seal all ducts (as a minimum).
• All new HVAC equipment shall be sized properly.
Furnaces Reputable manufacturer.
• EPA Energy Star qualified.
Central Air Conditioners Reputable manufacturer.
• EPA Energy Star qualified.
Thermostats . Reputable manufacturer.
• EPA Energy Star qualified.
• Programmable.
Minimum Standard • Additions and alterations that were constructed without a building
permit and are clearly substandard shall be removed.
• Additions and alterations that were constructed without a building
permit, but appear to be compliant, shall be inspected by the City's
Building Official to determine if a building permit can be issued and they
can be saved.
EXHIBIT 1
2501-60
EXHIBIT E
PROMISSORY NOTE SECURED BY DEED OF TRUST
TO THE CITY OF SANTA ANA, CALIFORNIA
Address:
Santa Ana, California
$ .00 52009
FOR VALUE RECEIVED, ANR Santa Ana, NSP, LLC, a limited liability company
("Borrower"), hereby promises to pay to the CITY OF SANTA ANA, a charter city and
municipal corporation ("City"), or order, a principal amount not to exceed
DOLLARS ($ .00) or so much thereof as may be
advanced by the City to the Borrower, due and payable upon sale to a qualified
Homebuyer, pursuant to the Neighborhood Stabilization Program Grant Services
Agreement dated concurrently herewith, between Borrower and the City (the
"Agreement"), which is incorporated herein by this reference. Title III of Division B of
the Housing and Economic Recovery Act of 2008 (Pub. L 110-289, 122 Stat. 2654
enacted July 30, 2009) makes available to certain qualified municipalities for certain
qualified grant funds termed Neighborhood Stabilization Program ("NSP Funds") under a
program termed the Neighborhood Stabilization Program (the "NSP"). Any capitalized
term not otherwise defined in this Note shall have the meaning ascribed to such term in
the Agreement. The obligation of Borrower to City hereunder is subject to the terms of
the Agreement, the Deed of Trust and this Note. Said documents are public records on
file in the offices of the City, and the provisions of said documents are incorporated
herein by this reference.
Definitions:
For the purpose of calculating the payments to be made by Borrower to City
pursuant to this Note, the following terms shall have the following respective meanings:
"Affordable Sales Price" shall mean a purchase price which results in an
Affordable Housing Cost to a Low or Moderate Income Purchaser. The Affordable
Housing Cost for Low Income households will be the product of 30% times 65% of the
Area Median Income adjusted for family size appropriate for the unit. For Moderate
Income households, the Affordable Housing Cost will be the product of 35% of 100% of
the Area Median Income, adjusted for family size appropriate for the unit. These income
limits will be used to determine a Homebuyer's maximum income for eligibility to
purchase a Low or Moderate Income Unit.
"City Loan" shall mean the loan evidenced by this Note repayable to the City in
accordance with the terms of this Note and secured by the Deed of Trust.
"Deed of Trust" shall mean the Deed of Trust in favor of the City, securing the
City Loan, substantially in the form attached to the Agreement as Exhibit C, which is
incorporated herein by this reference.
1
EXHIBIT 1
25D-61
EXHIBIT E
"Homebuyer" shall mean the qualified Low or Moderate Income Household that
originally purchases the NSP Assisted Unit from the Developer.
"Low Income" means an adjusted income which does not exceed eighty percent
(80%) of the Orange County, California PMSA, adjusted for household size, as published
by HUD.
"Moderate Income" means an adjusted income which does not exceed one
hundred twenty percent (120%) of the Orange County, California PMSA, adjusted for
household size, as published by HUD.
"Neighborhood Stabilization Program" (NSP) has the meaning set forth in the
Recitals above.
"Property" shall mean each piece of real property acquired pursuant to the terms
of the Agreement.
"Sale" shall mean any transfer, assignment, or conveyance or lease of the Property
or any portion thereof, or any interest therein by the Borrower, and includes any transfer,
assignment or sale of any partnership interest in the Borrower by an individual or entity
which is a general or limited partner in the Borrower, or any interest by any individual or
entity which holds an interest in any such general or limited partner in the Borrower,
which brings the cumulative total of all such direct and indirect transfers, assignments
and sales during the term of this Note to more than thirty-five percent (35%) of the
ownership interests in the Borrower, and any such transfer, assignment or sale of a direct
or indirect partnership interest thereafter. Sale includes a sale in condemnation or under
threat thereof. Sale does not include dedications and grants of easements to public and
private utility companies of the kind customary in real estate development.
2. This Note evidences the obligation of Borrower to the City for the
repayment of the City Loan of NSP Funds attributable to the acquisition and
rehabilitation (if any) of the Property.
3. This Note is payable at the principal office of City of Santa Ana -
Community Development Agency, 20 Civic Center Drive, Santa Ana, California 92702,
Att: Housing Division, or at such other place as the holder hereof may inform Borrower
in writing, in lawful money of the United States.
4. This Note shall be secured by the Deed of Trust.
5. Upon the City approved Sale of the Property to a Low or Moderate
Income Household for the Affordable Sales Price pursuant to the terms of the Agreement,
the loan will be transferred to the Homebuyer. The loan amount will be the amount of
NSP Funds to create this homeownership opportunity which will be determined based on
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25?B161
EXHIBIT E
the affordable sales price, the fair market value or the maximum sales price permitted
under the NSP Program at the time of such sale.
6. (a) Prior to the sale of the Property to an income qualified
purchaser, Borrower shall not assign or attempt to assign the Agreement or any right
therein, nor make any total or partial sale, transfer, conveyance or assignment of the
whole or any part of the Property, or any portion thereof or interest therein (referred to
hereinafter as a "Transfer"), without prior written approval of the City, except as
otherwise permitted in this Note. Consent to one such transaction shall not be deemed to
be a waiver of the right to require consent to future or successive transactions. City may
grant or deny such consent in its sole discretion and, if consent should be given, any such
transfer shall be subject to this Section, and any such transferee shall assume all
obligations hereunder and agree to be bound by all provisions contained herein.
(b) Any such proposed transferee shall have the experience, qualification
and financial responsibility necessary and adequate as may be reasonably determined by
the City, to fulfill the obligations undertaken in the Agreement and this Note by the
Borrower. Any such proposed transferee, by instrument in writing satisfactory to the
City and in form recordable among the land records of Orange County, for itself and its
successors and assigns, and for the benefit of the City shall expressly assume all of the
obligations of Borrower under the Agreement and Deed of Trust, and agree to be subject
to all conditions and restrictions applicable to Borrower in this Note. There shall be
submitted to the City for review all instruments and other legal documents proposed to
effect any such transfer; and if approved by the City its approval shall be indicated to
Borrower in writing.
(c) In the absence of specific written agreement by the City, no
unauthorized Transfer, or approval thereof by the City, shall be deemed to relieve the
Borrower or any other party from any obligations under the Agreement.
(d) In the event of a Transfer prior to the time the City Loan is paid in
full without the prior written consent of the City, the proceeds resulting from such
Transfer shall be paid to the City to the extent necessary to pay in full the principal
balance of the City Loan.
(e) As used herein, "transfer" includes the sale, agreement to sell, transfer
or conveyance of the Property, or any interest therein, whether voluntary, involuntary, by
operation of law or otherwise, or similar instrument affecting all or a portion of the
Property. "Transfer" shall not include a conveyance of the Property to a limited
partnership in which Borrower is a general partner, a limited liability company in which
Borrower is the managing member, or to a corporation that is wholly owned by Borrower
and that is formed for the sole purpose of owning and operating the Property, or the sale
back to Borrower.
(f) The term "Sale" means any transfer, assignment or conveyance
3
EXHIBIT 1
25D-63
EXHIBIT E
to a Low or Moderate Income Household, for primary residential occupancy of the
Property, as approved by City.
(g) Upon the sale of the Property, approved by City in accordance with
the Agreement and the Deed of Trust, City shall release the applicable Property from the
Deed of Trust and execute a reconveyance of the lien of the Deed of Trust from the
Property.
(h) The City shall not unreasonably withhold, condition or delay its
approval of any matter for which its approval is required hereunder. Any disapproval
shall be in writing and contain the City's reasons for disapproval.
7. Borrower agrees for itself, its successors and assigns, that the use of the
Property shall be subject to the restrictions on income and occupancy set forth in the
Agreement and the Deed of Trust.
8. The City Loan evidenced hereby is a nonrecourse obligation of the
Borrower. Neither Borrower nor any other party shall have any personal liability for
repayment of the City Loan. The sole recourse of City under this Note and the Deed of
Trust for repayment of the City Loan shall be the exercise of its rights against the
Property and related security thereunder. The foregoing shall not: (1) constitute a
waiver of any obligation evidenced by this Note or the Deed of Trust; (2) limit the right
of the City to name Borrower as a party defendant in any action or suit for judicial
foreclosure and sale under this Note and the Deed of Trust or any action or proceeding
hereunder so long as no judgment in the nature of a deficiency judgment shall be asked
for or taken against Borrower; (3) release or impair this Note or the lien of the Deed of
Trust: (4) prevent or in any way hinder City from exercising, or constitute a defense, an
affirmative defense, a counterclaim, or other basis for relief in respect of the exercise of,
any other remedy against the Property or any other instrument securing this Note or as
prescribed by law or in equity in case of default; (5) prevent or in any way hinder City
from exercising, or constitute a defense, an affirmative defense, a counterclaim, or other
basis for relief in respect of the exercise of, its remedies in respect of any
deposits, insurance proceeds, condemnation awards or other monies or other collateral or
letters of credit securing this Note; (6) relieve Borrower of any of its obligations under
any indemnity delivered by Borrower to City; or (7) affect in any way the validity of any
guarantee from any person of all or any of the obligations evidenced and secured by this
Note and the Deed of Trust. The foregoing provisions of this paragraph are limited by
the proviso that in the event of the occurrence of a default, Borrower and its successor
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 revenues, or other payments or proceeds in respect of the Property,
which other revenues, or other payments or proceeds have not been used for the payment
of ordinary and reasonable operating expenses of the Property, ordinary and reasonable
capital improvements to the Property, debt service on this Note, real estate taxes in
respect of the 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
4
EXHIBIT 1
25D-64
EXHIBIT E
Property, which are then due and payable. In addition, City may recover directly from
Borrower or any other party:
(a) any damages, costs and expenses incurred by City as a result of
fraud or any criminal act or acts of Borrower or any partner, shareholder,
officer, director or employee of Borrower or of any general or limited
partner of Borrower;
(b) any damages, costs and expenses incurred by City as a result of
any misappropriation of funds provided for the construction of the
Improvements on the Property, proceeds and revenues from the operation
of the Improvements, or proceeds of insurance policies or condemnation
proceeds;
(c) all court costs and attorneys' fees reasonably incurred in enforcing or
collecting upon any of the foregoing exceptions (provided that City shall
pay Borrower's reasonable court costs and attorneys' fees if Borrower is
the prevailing party in any such enforcement or collection action).
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 Deed of Trust or any term or provision of either thereof.
10. Upon the failure of Borrower to perform or observe any other term or
provision of this Note, or upon the occurrence of any event of default under the terms of
the Deed of Trust or the Agreement or, the holder may exercise its rights or remedies
thereunder.
11. Failure or delay by Borrower to perform any term or provision of the
Agreement, this Note or the Deed of Trust constitutes a default under this Note.
a. City shall give written notice of default to Borrower, specifying the
default complained of by the City. Delay in giving such notice shall not constitute a
waiver of any default nor shall it change the time of default.
b. Any failures or delays by City 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 City in asserting any of its rights and remedies shall not
deprive City 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 under this Note, the Deed of
5
EXHIBIT 1
25D-65
EXHIBIT E
Trust or any other applicable document or instrument, prior to exercising any remedies,
the City shall give Borrower written notice of such default. Borrower shall have seven
(7) days after such notice is given within which to cure the default prior to exercise of
remedies by City under this Note and/or the Deed of Trust.
d. If a non-monetary event of default occurs under the terms of the
Agreement, this Note, the Deed of Trust, prior to exercising any remedies hereunder or
thereunder, City 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 City under the applicable agreement, this Note
and/or the Deed of Trust. 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 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 City. In no event shall City 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 notice of default is first given.
11. Notwithstanding specific provisions of this Note, nonperformance
hereunder shall not be deemed to be in default where delays or defaults are due to: war,
insurrection; strikes; lockouts; riots; floods, earthquakes; fires; casualties; acts of God;
acts of the public enemy; epidemics; quarantine restrictions; or priority; litigation;
unusually severe weather; inability to secure necessary labor, materials or tools; delays of
any contractor or supplier; acts of the other party; acts or failure to act of the City or any
other public or governmental agency or entity (except that an any act or failure to act of
City shall not excuse performance by City); or any other causes beyond the reasonable
control or without the fault of the party claiming an extension of time to perform. An
extension of time for any such cause shall be for the period of the enforced delay and
shall commence to run from the time of the commencement of the cause. If, however,
notice by the party claiming such extension is sent to the other party more than thirty (30)
days after the commencement of the cause, the period shall commence to run only thirty
(30) days prior to the giving of such notice. Times of performance under this Note may
also be extended in writing by the City and Borrower.
12. 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 shall be completely performed and paid.
13. Borrower shall have the right to prepay the obligation evidenced by this
Note, or any part thereof, without penalty.
IN WITNESS WHEREOF, Borrower has executed this Note as of the day and
year set forth above.
6
EXHIBIT 1
25D-66
EXHIBIT E
ANR Santa Ana, NSP, LLC
a Limited Liability Company
By:
George Jordan
Vice President
EXHIBIT 1
25D-67
EXHIBIT F
PROGRESS PAYMENT REQUEST
Date
Project Number:
Homeowner:
Address:
Telephone #:
PROGRESS PAYMENT #:
AMOUNT APPROVED:
AMOUNT RETAINED (-10%)
AMOUNT TO BE DISBURSED:
PAYABLE TO:
V OFFICE USE ONLY V
SOURCE OF. FUNDS AMOUNT
? HOME
o'CALHOME
Q TAX INCREMENT
E CDBG
E.
TOTAL DISBURSEMENT
IDS NUMBER;
ESCROW NUMBER:
ACCOUNT NUMBER / W.O. #:
CONTRACTOR
The undersigned CONTRACTOR: (1) Certifies that to the best of their knowledge, information and belief, the work summarized on the
attached invoice and covered by this Progress Payment Request has been completed in accordance with the Housing Rehabilitation Work
Contract; (2) Certifies that they have obtained all required building permits, inspections and approvals for the work covered by this Progress
Payment Request; (3) Certifies that they have not promised or given the HOMEOWNER a cash payment or rebate.
Date Contractor (Signature)
HOMEOWNER
The undersigned HOMEOWNER: (1) Certifies that to the best of their knowledge, information and belief, the work summarized above and
covered by this Progress Payment Request has been completed to their satisfaction and in accordance with the Housing Rehabilitation Work
Contract; (2) Authorizes payment to the CONTRACTOR in the amount requested; (3) Acknowledges and agrees that inspections by the City's
Residential Construction Specialist (RCS) are performed for financial purposes and to ensure compliance with program requirements, and
should not be relied upon as a surety that the work was done properly.
Date
Homeowner (Signature)
CITY OF SANTA ANA
Based on site observations, the undersigned Residential Construction Specialist (RCS) certifies that to the best of their knowledge,
information and belief, the work summarized above and covered by this Progress Payment Request has been completed in accordance with
the Housing Rehabilitation Work Contract and complies with program requirements.
Date Residential Construction Specialist (Signature)
The undersigned certify that to the best of their knowledge, information and belief, this Progress Payment Request has been properly
prepared and documented and authorize the disbursement of funds to cover the amount requested.
Date
Date
Required Attachments: Contractor's Invoice, Full Release
Senior Residential Construction Specialist (Signature)
Housing Programs Coordinator (Signature)
CITY OF SANTA ANA
Housing & Neighborhood Development
20 Civic Center Plaza / 3rd Floor / P.O. Box 1988 / M-26 / Santa Ana, CA 92702
(714) 667-2250
25D-6S
EXHIBIT F
CITY OF SANTA ANA
Housing & Neighborhood Development
20 Civic Center Plaza / 3rd Floor / P.O. Box 1988 / M-26 / Santa Ana, CA 92702
(714) 667-2250
FINAL PAYMENT REQUEST
Date: V OFFICE USE ONLY V
Project Number:
Homeowner:
Address:
Santa Ana, CA
Telephone
PROGRESS PAYMENT #:
AMOUNT APPROVED:
AMOUNT RETAINED (-10%)
AMOUNT TO BE DISBURSED:
PAYABLE TO:
SOURCE OF FUNDS
Ci HOME
D CALHOME
D TAX INCREMENT
17 CDBG
TOTAL DISBURSEMENT
IDS NUMBER:
ESCROW NUMBER:
ACCOUNT NUMBER / W.O.#:
AMOUNT
CONTRACTOR
The undersigned CONTRACTOR: (1) Certifies that to the best of their knowledge, information and belief, the work summarized on the
attached invoice and covered by this Final Payment Request has been completed in accordance with all of the terms and conditions of
the Housing Rehabilitation Work Contract; (2) Certifies that they have obtained all required building permits, inspections and approvals
for the work covered by this Final Payment Request; (3) Certifies that they have not promised or given the HOMEOWNER a cash
payment or rebate.
Date
Contractor (Signature)
HOMEOWNER
The undersigned HOMEOWNER: (1) Certifies that to the best of their knowledge, information and belief, the work summarized above
and covered by this Final Payment Request has been completed to their satisfaction and in accordance with the terms and conditions
of the Housing Rehabilitation Work Contract; (2) Authorizes payment to the CONTRACTOR in the amount requested; (3)
Acknowledges and agrees that inspections by the Residential Construction Specialist (RCS) are performed for financial purposes and
to ensure compliance with program requirements, and should not be relied upon as a surety that the work was done properly.
Date Homeowner (Signature)
CITY OF SANTA ANA
Based on site observations, the undersigned Residential Construction Specialist (RCS) certifies that to the best of their knowledge,
information and belief, the work summarized above and covered by this Final Payment Request has been completed in accordance
with the terms and conditions of the Housing Rehabilitation Work Contract and in compliance with program requirements.
Date Residential Construction Specialist (Signature)
The undersigned certify that to the best of their knowledge, information and belief, this Final Payment Request has been properly
prepared and documented and authorize the disbursement of funds to cover the amount requested.
Date
Date
Senior Residential Construction Specialist (Signature)
Housing Programs Coordinator (Signature)
Required Attachments: Contractor' s Invoice, Full Release, Punch List, Certificate of Final Inspection, Notice of Completion (if applicable)
08/2005
2501-69
EXHIBIT F
k
?1
CITY OF SANTA ANA
Housing & Neighborhood Development
20 Civic Center Plaza / 3rd Floor / P.O. Box 1988 / M-26 / Santa Ana, CA 92702
(714) 667-2250
AUTHORIZATION FOR RELEASE OF RETENTION FUNDS
Date:
Project Number:
Homeowner:
Address:
Santa Ana, CA
Telephone #:
PROGRESS PAYMENT #:
AMOUNT APPROVED:
AMOUNT RETAINED (-10%)
AMOUNT TO BE DISBURSED:
PAYABLE TO:
V OFFICE USE ONLY V
SOURCE OF FUNDS
D HOME
CALHOME
Ll TAX INCREMENT
F1 CDBG
AMOUNT
TOTAL DISBURSEMENT
IDS NUMBER:
ESCROW NUMBER:
ACCOUNT NUMBER / W.O*
CONTRACTOR
The undersigned CONTRACTOR certifies that to the best of their knowledge, information and belief, all charges for labor
and material incurred by CONTRACTOR and used in construction pursuant to the Housing Rehabilitation Work Contract
have been paid in full, and that no liens and/or legitimate claims have been reported.
Date Contractor (Signature)
HOMEOWNER
The undersigned HOMEOWNER: (1) Certifies that to the best of their knowledge, information and belief, the
CONTRACTOR has complied with the Housing Rehabilitation Work Contract and that no liens and/or legitimate claims have
been reported; (2) Authorizes the release of the retention funds to the CONTRACTOR.
Date
Homeowner (Signature)
CITY OF SANTA ANA
The undersigned Residential Construction Specialist (RCS) certifies that to the best of their knowledge, information and
belief, the CONTRACTOR has complied with the Housing Rehabilitation Work Contract and is entitled to receive the
retention funds withheld during construction.
Date Residential Construction Specialist (Signature)
The undersigned certify that to the best of their knowledge, information and belief, this Request For Retention Funds has
been properly prepared and documented and authorize the disbursement of funds in the amount requested.
Date
Senior Residential Construction Specialist (Signature)
Date Housing Programs Coordinator (Signature)
Required Attachments:
02/2004
25D-70
EXHIBIT F
Order No.
Escrow No.
Project No.
RECORDING REQUESTED BY
CITY OF SANTA ANA
GOVT. CODE § 6103
WHEN RECORDED MAIL TO:
City of Santa Ana 1 Housing
20 Civic Center Plaza 1 Third Floor I M-26
Santa Ana, CA 92701
NOTICE OF COMPLETION
NOTICE IS HEREBY GIVEN THAT:
1. The undersigned is OWNER or agent of the OWNER of the interest or estate stated below in the property hereinafter
described.
2. FULL NAME of the OWNER is:
3. The FULL ADDRESS of the OWNER is:
4. The NATURE OF THE INTEREST or ESTATE of the undersigned is: In Fee
(If other than fee, strike "in fee" and insert, for example, "purchaser under contract of purchase", or "lessee".)
5. The FULL NAMES and FULL ADDRESSES of ALL PERSONS, if any, WHO HOLD SUCH INTEREST or ESTATE with
the undersigned as JOINT TENANTS or as TENANTS IN COMMON are:
NAMES ADDRESSES
6. The FULL NAMES and FULL ADDRESSES of the predecessors in interest of the undersigned if the property was
transferred subsequent to the commencement of the work of improvement herein referred to:
NAMES ADDRESSES
7. A work of improvement on the property hereinafter described was COMPLETED:
8. The work of improvement completed is described as follows:
9. The NAME OF THE ORIGINAL CONTRACTOR, if any, for such work of improvement is:
10. The street address of said property is:
11. The property on which said work of improvement was completed is in the CITY OF SANTA ANA, County of Orange,
State of California, and is described as follows:
Printed name of OWNER or AGENT of OWNER
Signature of OWNER or AGENT of OWNER
Verification for INDIVIDUAL owner:
I the undersigned declare under penalty of perjury under the laws of the State of California that I am the owner of the
aforesaid interest or estate in the property described in the above notice. I have read said notice and I know and understand
the contents thereof, and that the facts stated therein are true and correct.
Printed name of OWNER named in paragraph 2
Date and Place Signature of OWNER named in paragraph 2
Verification for NON-INDIVIDUAL owner: I the undersigned declare under penalty of perjury under the laws of the State of
California that I am the of the aforesaid interest or estate in the property described in
"President, Partner, Manager, Agent, Etc."
the above notice; that I have read the said notice, that I know and understand the contents thereof, and that the facts stated
therein are true and correct.
Printed name of person signing on behalf of OWNER
Date and Place Signature of person signing on behalf of OWNER
1054(3/81)
MYL-71
EXHIBIT G
Marketing Plan
ANR and Allegiant Group Properties, Inc., our affiliated real estate company,
have extensive experience developing and selling homes to first-time and
moderate income buyers. We believe there are many elements to successfully
marketing rehabilitated homes to moderate-income families, including:
Use of Experienced Real Estate Community
While Allegiant Group Properties is a licensed real estate company, we
recognize the value in listing our rehabilitated properties with a local real
estate agent who has extensive experience in the Santa Ana market. This
is particularly true in a challenging market, such as we are facing now,
where the majority of sales transactions are REOs and short sales. We
have an established relationship with Realty Analytics (RA), a real estate
research company that extensively analyzes data available from multiple
listing services in order to identify the highest-performing listing agents in
any given market. As a result of the research they provided us at the
onset of our NSP1 work in Santa Ana, we established relationships with 5
experienced Santa Ana listing agents after a screening and interview
process. We have been working with three of these agents throughout out
NSP1 and NSP2 efforts in the City, and would anticipate continuing these
relationships through NSP3 should we be selected as the City's Developer
Partner. The remaining two agents we identified but are not currently
utilizing can be added as back-up agents for NSP3 efforts should volume
increase and we need additional agent capacity.
Additionally, due to the high-volume of work we provide our current Santa
Ana NSP agents, we have been successful in negotiating reduced
commission rates on all NSP 1 and 2 listings we assign. This would be of
great benefit to the City for NSP3 efforts in that overall project costs would
continue at a reduced rate from what a typical Developer Partner would
propose. Industry typical real estate commissions are 6% (3% to Listing
Agent and 3% to Buyer's [Selling] Agent), and our current agent structure
in Santa Ana reduces commissions to a total of 4.5% (2% to Listing Agent
and 2.5% to Buyer's [Selling Agent]).
In the Santa Ana market we also recognize the importance of affiliating
with agents who understand the various cultures that are represented in
the city and who have bilingual capabilities as well as experience working
with first-time and moderate income buyers. The Agents whom have been
successful working with us on NSP1 and NSP2 efforts all have strong ties
to the community, and are either bi-lingual themselves (Spanish speaking)
or have access to bi-lingual communicators in their offices. All of our
current NSP1 and NSP2 agents have experience with down payment
assistance and/or layered financing in Santa Ana and/or other cities so
they clearly understand the special requirements of processing these
types of transactions.
EXHIBIT 1
2501-72
EXHIBIT G
2. Relationships with Homebuyer Counseling Organizations
ANR works closely with local non-profit organizations that provide
counseling to first-time homebuyers to identify families that have
completed training courses and are prepared to buy, but still need to
identify a home to purchase.
We have established relationships with Neighborhood Housing
Services of Orange County (NHS-OC) as well as Consumer Credit
Counseling Services of Orange County (CCCS-OC), and both
organizations have been trained in the Santa Ana Neighborhood
Stabilization Program, understand the benefits of the program for
prospective homebuyers, and both agencies are currently referring
prospective homebuyers to the program as an existing business practice
at their homebuyer education classes and seminars.
Both of these organizations have also been provided with flyers and
website information for the current Santa Ana Homeownership Program
(NSP1 and NSP2) we have been administering to date, and these flyers
as well as website access are both available in their offices and distributed
to interested parties.
3. Incentives and Down Payment Assistance Promotion
The City of Santa Ana offers a down payment assistance program that
provides zero percent interest loans up to ten percent (10%) of the sales
price or $40,000. ANR and our selected listing agents have been
successfully promoting the availability of this program and the City's
American Dream Down Payment Initiative (ADDI) funds (only at the City's
direction), and have been successful in facilitating sales to homebuyers
seeking these alternative sources of financial assistance.
We would propose to continue our efforts in promotion of the Down
Payment Assistance Program, and would also continue to place program
flyers in all available homes for sale, as well as continue promotion via
individual listing agents educating their offices as well as other agents in
the community they have relationships with.
4. Use of www.santaanahomeownership.org and
www.santaanahomeownership.com
ANR designed and implemented www.santaanahomeownership.org and
www.santaanahomeownership.com, a comprehensive website for the
Santa Ana Home Ownership Program (NSP1 and NSP2), that includes
basic program information, home features, eligibility requirements and
other purchase information for prospective buyers set-up in an extremely
user-friendly interface. We also have included City down payment
assistance flyers and eligibility requirements, and the website has become
EXHIBIT 1
25D-73
EXHIBIT G
a very success marketing tool for the program. Agents are able to identify
program requirements online, educate their clients, and also view new
properties to market to their buyer pools.
Properties are added to the website upon acquisition close of escrow and
listed in `Coming Soon' status, moved to listed 'Available' (with a new
`after' photo) once rehabilitation is complete and the City approves list
pricing, then moved to 'Sold' upon a buyer's successful close of escrow.
The www.santaanahomeownership.org and
www.santaanahomeownership.com websites have also enabled
NSP1 and NSP2 prospective buyers to contact ANR staff
directly, and this has given us an additional ability to market the
program in a personal and more direct way to prospective
buyers. Buyers are able to call ANR's staff and ask questions, voice
concerns, or inquire about current properties, and their calls/email
inquiries are all handled same-day.
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5. Implementation of Santa Ana Home Ownership Program signage to
brand the program
At the on-set of our NSP1 efforts in Santa Ana, we implemented a sign
program that adds visibility to the Santa Ana Home Ownership Program
and helps brand homes that are being readied for sale. Prospective
buyers may be driving through a community, will see a Program Sign, and
are given direct access via our website listed to instantly obtain more
information about both the home and the program. These signs have also
helped with the word of mouth marketing of the program.
EXHIBIT 1
25D-74
EXHIBIT G
CITY OF SANTA ANA
Home Website address has since been
Ownership changed to
www.santaanahomeownership.org
Program
www.santa-ana.org/cda/home.asp
bye
0
Neighborhood Stabilization Program
6. Marketing to City Residents and Persons employed in City
businesses/Grass-roots marketing
Our Listing Agents work with their established community relationships to
help spread the word and brand the Santa Ana Home Ownership Program
in a number of ways:
a. Hand delivered or direct mailed "Just Listed" postcards and/or flyers
to local residents (within a designated radius of a new listing)
b. Open house events held on-site to allow neighbors and prospective
buyers to tour properties, and spread the word about the program
c. Outreach to local businesses and large employers to identify
persons that may be working in the area but living elsewhere and
are unaware of Santa Ana NSP homes. This may include
conducting seminars for large-scale employers in lunch rooms or
other employer-approved facilities, as well as proposing employee
payroll stuffers or utility company invoice marketing for residents.
d. Community outreach and face to face door knocking of neighbors in
the area of a new listing.
7. MILS Listing and Agent to Agent Marketing
a. All Listing Agents we work with input new listings into the Multiple
Listing Service (MLS) to give them maximum exposure to the Agent
community. Research tells us that in some cases, over 70% of
homes are sold using the MLS as the primary source of info, and in
that instance you have a buyer who is already working with and
Agent and the Agent views the MLS listing for our NSP home.
b. E-blasts (also a form of internet marketing) of new Santa
Homeownership Program listings are sent out by our agents to their
own offices, as well as other local real estate offices, informing
other Agents about the program and new properties available for
sale.
EXHIBIT 1
25D-75
EXHIBIT G
c. Work with local MLS for potential program advertising opportunities
on their website and in newsletters.
a. Hold Broker caravans for MLS members to expand visibility of
properties to Agent community both in and outside the City.
8. Additional Marketing As Needed
ANR is also experienced in several other marketing methods for NSP and
other moderate -income home sale efforts, and can employ the following
marketing tactics as needed, or upon direction of City staff:
a. Direct mail or door hangers to local apartment communities and
other known high-rental neighborhoods
b. Develop incentive programs for Police, Sheriff, Teachers or other
civil servant occupations
c. Implement social marketing via set-up of Facebook page and other
social media
d. Develop monthly e-communications to email inquiries from the
www.santaanahomeownership.org website
EXHIBIT 1
25D-76
EXHIBIT H
MARKETING EFFORTS REPORT
Medium Frequency and/or Language Location
Dates
EXHIBIT 1
25D-77
EXHIBIT I
Chapter Three - Calculating Annual (Gross) Income
Exhibit 3.1 - 24 CFR Part 5 Annual Income Inclusions
1. The full amount, before any payroll deductions, 5.
of wages and salaries, overtime pay,
commissions, fees, tips and bonuses, and
other compensation for personal services.
3.
4.
The net income from the operation of a
business or profession. Expenditures for
business expansion or amortization of capital
indebtedness shall not be used as deductions
in determining net income. An allowance for
depreciation of assets used in a business or
profession may be deducted, based on
straight-line depreciation, as provided in
Internal Revenue Service regulations. Any
withdrawal of cash or assets from the operation
of a business or profession will be included in
income, except to the extent the withdrawal is
reimbursement of cash or assets invested in
the operation by the family.
Interest, dividends, and other net income of
any kind from real or personal property.
Expenditures for amortization of capital
indebtedness shall not be used as deductions
in determining net income. An allowance for
depreciation is permitted only as authorized in
number 2 (above). Any withdrawal of cash or
assets from an investment will be included in
income, except to the extent the withdrawal is
reimbursement of cash or assets invested by
the family. Where the family has net family
assets in excess of $5,000, annual income
shall include the greater of the actual income
derived from all net family assets or a
percentage of the value of such assets based
on the current passbook savings rate, as
determined by HUD.
The full amount of periodic amounts received
from Social Security, annuities, insurance
policies, retirement funds, pensions, disability
or death benefits, and other similar types of
periodic receipts, including a lump-sum amount
or prospective monthly amounts for the
delayed start of a periodic amount (except for
certain exclusions, listed in Exhibit 3.2, number
14).
Payments in lieu of earnings, such as
unemployment and disability compensation,
worker's compensation, and severance pay
(except for certain exclusions, as listed in
Exhibit 3.2, number 3).
6. Welfare Assistance. Welfare assistance
payments made under the Temporary
Assistance for Needy Families (TANF) program
are included in annual income:
• Qualify as assistance under the TANF
program definition at 45 CFR 260.31; and
• Are otherwise excluded from the calculation
of annual income per 24 CFR 5.609(c).
If the welfare assistance payment includes an
amount specifically designated for shelter and
utilities that is subject to adjustment by the
welfare assistance agency in accordance with
the actual cost of shelter and utilities, the
amount of welfare assistance income to be
included as income shall consist of:
• the amount of the allowance or grant
exclusive of the amount specifically
designated for shelter or utilities; plus
• the maximum amount that the welfare
assistance agency could in fact allow the
family for shelter and utilities. If the family's
welfare assistance is reduced from the
standard of need by applying a percentage,
the amount calculated under 24 CFR 5.609
shall be the amount resulting from one
application of the percentage.
7. Periodic and determinable allowances, such as
alimony and child support payments, and
regular contributions or gifts received from
organizations or from persons not residing in
the dwelling.
8. All regular pay, special pay, and allowances of
a member of the Armed Forces (except as
provided in number 8 of Income Exclusions).
Last Modified: January 2005
Technical Guide for Determining Income and Allowances for the HOME Program - 20
EXHIBIT 1
2501-78
EXHIBIT I
Chapter Three - Calculating Annual (Gross) Income
Exhibit 3.2 - 24 CFR Part 5 Annual Income Exclusions
1. Income from employment of children (including
foster children) under the age of 18 years.
2. Payments received for the care of foster
children or foster adults (usually persons with
disabilities, unrelated to the tenant family, who
are unable to live alone).
3. Lump-sum additions to family assets, such as
inheritances, insurance payments (including
payments under health and accident insurance
and worker's compensation), capital gains, and
settlement for personal or property losses
(except as provided in Exhibit 3.1, number 5 of
Income Inclusions).
4. Amounts received by the family that are
specifically for, or in reimbursement of, the cost
of medical expenses for any family member.
5. Income of a live-in aide (as defined in 24 CFR
5.403).
6. Certain increases in income of a disabled
member of qualified families residing in HOME-
assisted housing or receiving HOME tenant-
based rental assistance (24 CFR 5.671(a)).
7. The full amount of student financial assistance
paid directly to the student or to the educational
institution.
8. The special pay to a family member serving in
the Armed Forces who is exposed to hostile
fire.
maintenance, resident initiatives coordination,
and serving as a member of the PHA's
governing board. No resident may receive
more than one such stipend during the same
period of time.
(e) Incremental earnings and benefits resulting
to any family member from participation in
qualifying state or local employment training
programs (including training not affiliated with
a local government) and training of a family
member as resident management staff.
Amounts excluded by this provision must be
received under employment training programs
with clearly defined goals and objectives, and
are excluded only for the period during which
the family member participates in the
employment training program.
10. Temporary, nonrecurring, or sporadic income
(including gifts).
11. Reparation payments paid by a foreign
government pursuant to claims filed under the
laws of that government by persons who were
persecuted during the Nazi era.
12. Earnings in excess of $480 for each full-time
student 18 years old or older (excluding the
head of household or spouse).
13. Adoption assistance payments in excess of
$480 per adopted child.
9. (a) Amounts received under training programs I 14.
funded by HUD.
(b) Amounts received by a person with a
disability that are disregarded for a limited time
for purposes of Supplemental Security Income
eligibility and benefits because they are set
side for use under a Plan to Attain Self-
Sufficiency (PASS).
(c) Amounts received by a participant in other
publicly assisted programs that are specifically
for, or in reimbursement of, out-of-pocket
expenses incurred (special equipment,
clothing, transportation, childcare, etc.) and
which are made solely to allow participation in
a specific program.
(d) Amounts received under a resident service
stipend. A resident service stipend is a modest
amount (not to exceed $200 per month)
received by a resident for performing a service
for the PHA or owner, on a part-time basis, that
enhances the quality of life in the development.
Such services may include, but are not limited
to, fire patrol, hall monitoring, lawn
15
16
17
Deferred periodic amounts from supplemental
security income and social security benefits
that are received in a lump sum amount or in
prospective monthly amounts.
Amounts received by the family in the form of
refunds or rebates under state or local law for
property taxes paid on the dwelling unit.
Amounts paid by a state agency to a family
with a member who has a developmental
disability and is living at home to offset the
cost of services and equipment needed to
keep the developmentally disabled family
member at home.
Amounts specifically excluded by any other
Federal statute from consideration as income
for purposes of determining eligibility or
benefits under a category of assistance
programs that includes assistance under any
program to which the exclusions set forth in 24
CFR 5.609(c) apply. A notice will be
published in the Federal Register and
distributed to housing owners identifying the
benefits that qualify for this exclusion.
Technical Guide for Determining Income and Allowances for the HOME Program - 21
EXHIBIT 1
25D-79
EXHIBIT I
Chapter Three - Calculating Annual (Gross) Income
Updates will be published and distributed when
necessary. The following is a list of income
sources that qualify for that exclusion:
• The value of the allotment provided to an
eligible household under the Food Stamp
Act of 1977;
• Payments to volunteers under the
Domestic Volunteer Service Act of 1973
(employment through AmeriCorps, VISTA,
Retired Senior Volunteer Program, Foster
Grandparents Program, youthful offender
incarceration alternatives, senior
companions);
• Payments received under the Alaskan
Native Claims Settlement Act;
• Income derived from the disposition of
funds to the Grand River Band of Ottawa
Indians;
• Income derived from certain submarginal
land of the United States that is held in
trust for certain Indian tribes;
• Payments or allowances made under the
Department of Health and Human
Services' Low-Income Home Energy
Assistance Program;
• Payments received under the Maine Indian
Claims Settlement Act of 1980 (25 U.S.C.
1721);
• The first $2,000 of per capita shares
received from judgment funds awarded by
the Indian Claims Commission or the U.S.
Claims Court and the interests of individual
Indians in trust or restricted lands, including
the first $2,000 per year of income received
by individual Indians from funds derived
from interests held in such trust or
restricted lands;
• Amounts of scholarships funded under Title
IV of the Higher Education Act of 1965,
including awards under the Federal work-
study program or under the Bureau of
Indian Affairs student assistance programs;
• Payments received from programs funded
under Title V of the Older Americans Act of
1985 (Green Thumb, Senior Aides, Older
American Community Service Employment
Program);
• Payments received on or after January 1,
1989, from the Agent Orange Settlement
Fund or any other fund established
pursuant to the settlement in the In Re
Agent Orange product liability litigation,
M.D.L. No. 381 (E.D.N.Y.);
• Earned income tax credit refund payments
received on or after January 1, 1991,
including advanced earned income credit
payments;
• The value of any child care provided or
arranged (or any amount received as
payment for such care or reimbursement
for costs incurred for such care) under the
Child Care and Development Block Grant
Act of 1990;
• Payments received under programs funded
in whole or in part under the Job Training
Partnership Act (employment and training
programs for Native Americans and
migrant and seasonal farm workers, Job
Corps, veterans employment programs,
state job training programs and career
intern programs, AmeriCorps);
• Payments by the Indian Claims
Commission to the Confederated Tribes
and Bands of Yakima Indian Nation or the
Apache Tribe of Mescalero Reservation;
• Allowances, earnings, and payments to
AmeriCorps participants under the National
and Community Service Act of 1990;
• Any allowance paid under the provisions of
38 U.S.C. 1805 to a child suffering from
spina bifida who is the child of a Vietnam
veteran;
• Any amount of crime victim compensation
(under the Victims of Crime Act) received
through crime victim assistance (or
payment or reimbursement of the cost of
such assistance) as determined under the
Victims of Crime Act because of the
commission of a crime against the
applicant under the Victims of Crime Act;
and
• Allowances, earnings, and payments to
individuals participating in programs under
the Workforce Investment Act of 1998.
Last Modified. January 2005
Technical Guide for Determining Income and Allowances for the HOME Program - 22
EXHIBIT 1
25D-80
EXHIBIT I
Chapter Three - Calculating Annual (Gross) Income
Exhibit 3.3 - Sample Format for Computing Part 5 Annual Income
1. Name: 2. Identification No.:
ASSETS
Family
Member
Asset Description Current Cash Value
of Assets Actual Income
from Assets
3. Net Cash Value of Assets ................................ 3.
4. Total Actual Income from Assets ................................................................. 4.
5. If line 3 is greater than $5,000, multiply line by _ (Passbook Rate)
and enter results here; otherwise, leave blank. 5.
ANTICIPATED ANNUAL INCOME
Family
Members a. Wages/
Salaries b. Benefits/
Pensions c. Public
Assistance d. Other
Income e. Asset
Income
Enter the
greater of
lines 4 or 5
from above
in e.
6. Totals a. b. C. d. e.
7. Enter total of items from 6a. through 6e. This is Annual Income ....................... ...... 7.
Signature
For Office Use Only
Income Limit
Income Limit of Household
Technical Guide for Determining Income and Allowances for the HOME Program - 23
EXHIBIT 1
2501-81
EXHIBIT I
Chapter Three - Calculating Annual (Gross) Income
Exhibit 3.4 - Calculating Part 5 Annual Income - Example
Family Members Position in Family Age Income Sources
George Jefferson Head 53 Works full-time at $7.25/hour; also receives
$400/month from the government as a result of a
settlement in the Agent Orange product liability
litigation.
Eloise Jefferson Spouse 48 Works 18 hours/week at a bank at $7.50/hour; also
receives $50/month from her mother to help with
expenses.
Lionel Jefferson Son -
19 -
Full-time student at City College where he has a
part-time, 15-hour/week job in the student bookstore
at $6.00/hour for the 46 weeks when classes are in
session.
Under the HOME Program, the Income Limit for a family of three in the jurisdiction is $23,900. Are the
Jefferson's eligible for HOME assistance? Assume for this example that the Jefferson's have no
assets.
ANTICIPATED ANNUAL INCOME
Family
Members a. Wages/
Salaries b. Benefits/
Pensions c. Public
Assistance d. Other
Income e. Asset
Income
George $15,080 Enter the
Eloise $7,020 $600 greater of
Lionel $480 lines 4 or 5
from above
in e.
6. Totals a. $22,580 b. C. d. $600 e. N/A
7. Enter total of items from 6a. through 6e. This is Annual Income ............................. 7. $23,180
This family is eligible for assistance because its total income of $23,180 is below the Low-Income Limit.
Explanation
George George's earning from work count as income, but his income from the Agent Orange
Settlement Fund ($4,800/year) does not. Thus, George's income is $7.25/hour x 40
hours/week x 52 weeks/year, or $15,080.
Eloise Eloise's income from wages of $7.50/hour x 18 hours/week x 52 weeks, or $7,020. In
addition, her regular gift income of $50/month or $600/year counts as income. (The gift
income is counted as "other income.")
Lionel Because Lionel is a full-time student and is not the head of household or spouse, only the first
$480 of his earnings count toward the family income.
Technical Guide for Determining Income and Allowances for the HOME Program - 24
EXHIBIT 1
2501-82
EXHIBIT I
Chapter Three - Calculating Annual (Gross) Income
Exhibit 3.5 - Calculating Part 5 Annual Income - Exercise
Family Members Position in Family Age Income Sources
Blanche Deverou Head 55 Works 6 hours/night, 4 nights/week at $5.00/hour as
a waitress; also earns an average of $551night in
tips.
Rose Nylen Friend 58 Earns $6.50/hour as a full-time aide in a hospital;
employer reports that her wages will increase to
$6.75/hour, 7 weeks from the effective date of this
calculation.
Dorothy Spornac Friend 61 Earns $60/day as a substitute teacher, and works
an average of 3 days/week for the 40 weeks school
is in session (she made $7,200 last year); also
receives $40/month in Food Stamps.
Under the HOME Program, the Income Limit for a household of three is $38,500. Assuming that these
are the only sources of income, does the household qualify for assistance?
Complete the following table to calculate annual income (as defined in 24 CFR Part 5) for the household.
Answers are found on the following page.
ANTICIPATED ANNUAL INCOME
Family
Members a. Wages/
Salaries b. Benefits/
Pensions c. Public
Assistance d. Other
Income e. Asset
Income
Blanche Enter the
Rose greater of
Dorothy lines 4 or 5
from above
in e.
6. Totals a. b. C. d. e. N/A
7. Enter total of items from 6a. through 6e. This is Annual Income ............................. 7.
Technical Guide for Determining Income and Allowances for the HOME Program - 25
EXHIBIT 1
25D-83
EXHIBIT I
Chapter Three - Calculating Annual (Gross) Income
Exhibit 3.5 - Calculating Part 5 Annual Income - Exercise (continued)
ANSWERS
ANTICIPATED ANNUAL INCOME
Family
Members a. Wages/
Salaries b. Benefits/
Pensions c. Public
Assistance d. Other
Income e. Asset
Income
Blanche $17,680 Enter the
Rose $13,980 greater of
Dorothy $7,200 lines 4 or 5
from above
in e.
6. Totals a. $38,860 b. C. d. e. N/A
7. Enter total of items from 6a. through 6e. This is Annual Income ............................. 7. $38,860
The household is not eligible for assistance. Its income exceeds the Low-Income Limit by $360.
Explanation
Blanche Blanche's income must include both wages and tips. (The tips are included as wage/salary
income.) Her wage income is $6,240 annually ($5.00/hour x 6 hours/night x 4 nights/week x
52 weeks/year) and her tip income is $11,440 annually ($55/night x 4 nights/week x 52
weeks/year).
Rose Rose's wage income must be calculated in two steps. For the first 6 weeks of the year, she
earns $6.50/hour. Her income at this wage is $6.50/hour x 40 hours/week x 6 weeks =
$1,560. For the next 46 weeks, her wage will be $6.75/hour. Her income at this wage is
$6.75/hour x 40 hours/week x 46 weeks = $12,420.
Dorothy Dorothy made $7,200 last year, and there is no reason to expect that she will work more or
less often in the coming year. Her income is, therefore, estimated at $7,200. Per the Income
Exclusions (see Exhibit 3.2), the income she receives from Food Stamps is excluded from
this calculation.
Technical Guide for Determining Income and Allowances for the HOME Program - 26
EXHIBIT 1
2501-84
EXHIBIT I
Chapter Three - Calculating Annual (Gross) Income
Exhibit 3.6 - Calculating Part 6 Annual Income - Example
Family Members Position in Family Age Income Sources
Murphy Brown Head 38 Earns $550 semi-monthly as a manager in the
housewares department of the local Kmart, and
receives $100/month in child support.
Eldon Bernakey Boyfriend 36 Earns $250/week as a part-time painting instructor
at the local school for the 40 weeks/year when
school is in session; attends evening classes at the
Art Institute, which he pays with a State Student
Incentive Grant of $3,500; and pays $50/month in
child support for his twins - when he can.
Ave Brown Son 3 No income.
Under the HOME Program, the Income Limit for a family of three in the jurisdiction is $25,700. Is this
household eligible for HOME assistance?
ANTICIPATED ANNUAL INCOME
Family
Members a. Wages/
Salaries b Benefits/
Pensions c. Public
Assistance d. Other
Income e. Asset
Income
Murphy $13,200 $1,200 Enter the
Eldon $10,000 greater of
lines 4 or 5
from above
in e.
6. Totals a. $23,200 b. C. d. $1,200 e. N/A
7. Enter total of items from 6a. through 6e. This is Annual Income ............................. 7. $24,400
This family is eligible for assistance. Its total income is $24,400, which is below the Low- Income Limit.
Explanation
Murphy Murphy's annual wage income is $550 semi-monthly x 24 periods/year, or $13,200. In
addition, she receives $100/month x 12 months = $1,200/year. This is other income.
Eldon Eldon's wage income is based on 40 weeks of work: $250/week x 40 weeks/year, or $10,000
annually. His scholarship does not count as income. The child support Eldon pays cannot
be deducted from his income.
Technical Guide for Determining Income and Allowances for the HOME Program - 27
EXHIBIT 1
2501-85
EXHIBIT J
CITY OF SANTA ANA
Neighborhood Stabilization Program Homeownership Program
PROMISSORY NOTE
Santa Ana, California
20
FOR VALUE RECEIVED, , the undersigned
(`Borrower"), promises to pay to the City of Santa Ana, a charter city and municipal
corporation ("Lender") at City Hall, 20 Civic Center Plaza, P.O. Box 1988, (M-25) Santa
Ana, California 92702, or at such other address as Lender may direct from time to time in
writing, Dollars ($ ) (the "Note Amount") together with
interest thereon at the rate set forth herein. All sums hereunder shall be payable in lawful
money of the United State of America and all sums shall be credited first to interest then
due and the balance to principal. The obligation of the Borrower with respect to this
Note is secured by that certain Deed of Trust Including Affordable Housing Deed
Restrictions ("Deed of Trust"), executed by the Borrower concurrently herewith.
Borrower shall be required to pay any and all service charges associated with the City
Loan. This Note evidences the obligation of Borrower to Lender for repayment of funds
loaned pursuant to California Redevelopment Law to finance the purchase of that certain
real property (the "Property") located at , Santa Ana, California.
1. Interest Rate.
Simple interest shall accrue in the Note Amount at a rate of Three (3%) per
annum for forty-five (45) years, except as set forth below.
2. Payments/Maturity Date.
For value received, the Borrower(s), jointly and severally, agree to pay the
Lender, the total sum of $ with interest from
, 20 , on unpaid principal at the rate of 3% per annum. All principal
and interest shall be deferred until subsequent sale or transfer of the Property. The Deed
of Trust will carry a 3% interest rate, and will be due and payable in forty-five (45) years.
Interest will be forgiven at a rate of 1/45th per year, at each anniversary date of the
original sale, with all interest forgiven at the end of the forty-five (45) year affordability
period. After the expiration of the affordability period, the principal amount of the Note
will be paid at transfer or sale.
The balance of all unpaid principal shall be due and payable on the date forty-five
years from the date hereof (the "Maturity Date"). Notwithstanding the foregoing, if on
the Maturity date the Borrower has complied with this Note and the Deed of Trust (as
such terms are defined below) and has not been in default under said documents, the
amount owed pursuant to this Note shall be considered mature, so long as all principal
and all related costs have been paid to the Lender.
EXHIBIT 1
25D-86
EXHIBIT J
No periodic payments are required hereunder. Borrower agrees to pay the unpaid
principal balance, unpaid accrued interest, and any other amounts due under this Note
upon the earlier of:
i. at the end of the forty-five (45) year term of affordability;
ii. when the Property is sold;
iii. when the Property is not properly being used as the Borrower's
principal residence;
iv. The City discovers that Borrower knowingly or willfully made a
misstatement or misrepresentation pertaining to Borrower's status
as an Eligible Person or Family; and
V. An uncured default in performance or breach by Borrower of any
provision of this Promissory Note, the City Deed of Trust
Including Affordable Housing Deed Restrictions.
3. Permitted Transfers.
The City Loan is not assumable except under the following limited circumstances:
i. The transfer of the Property to the surviving joint tenant by devise,
descent or operation of the law, on the death of a joint tenant;
ii. A transfer of the Property where the spouse becomes an owner of
the property;
iii. A transfer of the Property resulting from a decree of dissolution of
marriage, legal separation or from an incidental property
settlement agreement by which the spouse becomes an owner of
the Property;
iv. A transfer to an inter vivos trust in which the Borrower is and
remains the beneficiary and occupant of the property.
4. Acceleration of Payment.
The principal amount of this loan, together with any then outstanding accrued
interest thereon shall become immediately due and payable, at the option of the holder
and without demand or notice, upon the occurrence of any of the following events:
i. In the event of a default under the terms of this Note or the Deed of
Trust;
ii. In the event that the Borrower shall cease to occupy the Property as
Borrower's principal place of residence; or
iii. In the event of any sale, transfer, lease, or encumbrance of the
Property without Lender's prior written consent in violation of
Paragraph 3 of this Note.
EXHIBIT 1
25D-87
EXHIBIT J
5. Default and Acceleration.
All covenants, conditions and agreements contained in the Deed of Trust are
hereby made a part of this Note. The Borrower agrees that the unpaid balance of the then
principal amount of this Note, together with all accrued interest thereon and charges
owing, shall, at the option of the Lender or, if so provided in this Note and Deed of Trust
executed by the Borrower, shall automatically, become immediately due and payable, and
thereafter until paid bear interest at the rate of 3 % per annum, upon the failure of the
Borrower to make any payment hereunder as and when due; upon the failure of the
Borrower to perform or observe any other term or provision of this Note, or upon the
occurrence of any event (whether termed default, event of default or similar term) which
under the terms of the Deed of Trust, shall entitle the Lender to exercise rights or
remedies thereunder.
6. Security for Note.
This Promissory Note is secured by the Deed of Trust of even date herewith
executed by Borrower as Trustor in favor of Lender as Beneficiary encumbering the
Property described therein (Exhibit A to the Deed of Trust).
7. Prepayment of Note Amount.
Borrower may prepay to Lender the full Note Amount, at any time prior to the
due date of the Note Amount without penalty. The affordability covenants related to the
Property, as set forth in the Deed of Trust shall remain in effect against the Property for
forty-five (45) years from date of recordation, unless Borrower sells the Property and
repays the City the loan amount, plus interest, from said sale.
Agreement.
This Promissory Note is made and delivered pursuant to and in implementation of
the Deed of Trust signed by the Borrower dated as of the same date as this document, a
copy of which is on file as a public record with the Lender and is incorporated herein by
reference. The Borrower acknowledges that but for the execution of this Promissory
Note, the Lender would not make the loan contemplated therein. .
9. Lender May Assign.
Lender may, at its option, assign its right to receive payment under this
Promissory Note without necessity of obtaining the consent of the Borrower.
10. Borrower Assignment Prohibited.
In no event shall Borrower assign or transfer any portion of this Agreement
without the prior express written consent of the Lender, which consent may be given or
withheld in the Lender's sole discretion. Likewise, no assumption of the Loan shall be
EXHIBIT 1
25D-88
EXHIBIT J
permitted at any time. This Section shall not prohibit the Lender's right to assign all or
any portion of its rights to the loan proceeds hereunder.
11. Attorney's Fees and Costs.
In the event that any action is instituted to enforce payment under this Promissory
Note, the Borrower promises to pay all sums as a court may fix for court costs and
reasonable attorney's fees.
12. Non-Waiver by Lender. No waiver of any breach, default or failure
of condition under the terms of the Note or Deed of Trust shall thereby be implied from
any failure of the Lender to take, or any delay by the Lender in taking action with respect
to such breach, default or failure or from any previous waiver of any similar or unrelated
breach, default or failure; and a waiver of any term of the Note, Deed of Trust,
or any of the obligations secured thereby must be made in writing and shall be limited to
the express written terms of such waiver.
13. Successors Bound.
This Promissory Note shall be binding upon the parties hereto and their respective
heirs, executors, administrators successors and assigns.
14. Severability.
The provisions hereof shall be deemed independent and severable, and a
determination of invalidity or unenforceability of any one provision or portion hereof by
a court of competent jurisdiction shall not affect the validity or enforceability of any other
provisions hereof.
15. Joint and Several Liability.
If this Note is executed by more than one person or entity as Borrower, the
obligation of each such person or entity shall be joint and several. No person or entity
shall be a mere accommodation maker, but each shall be primarily and directly liable
hereunder.
16. Time of the Essence; Venue.
Time is of the essence with respect to every provision hereof. This Note shall be
constructed and enforced in accordance with the laws of the State of California, except to
the extent that Federal laws preempt the law of the State of California, and all persons
and entities in any manner obligated under this Note consent to the jurisdiction of any
Federal of State Court within the State of California having proper venue and also
consent to service of process by any means authorized by California or Federal law.
EXHIBIT 1
25D-89
EXHIBIT J
17. Notices.
Except as may be otherwise specified herein, any approval, notice, direction,
consent, request or other action by the Lender shall be in writing and must be
communicated to the Borrower at the address of the Property, or at such other place or
places as the Borrower shall designate to the Lender in writing, from time to time, for the
receipt of communications from the Lender. Mailed notices shall be deemed delivered
and received five (5) working days after deposit in the United States mails in accordance
with this provision.
Executed as of the date set forth above in Santa Ana, California.
Borrower:
Print Name:
Signature:
Borrower:
Print Name:
Signature:
City.HO.PromNote.docx 5 2/8/10
EXHIBIT 1
25D-90
EXHIBIT K
RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:
Community Redevelopment Agency
City of Santa Ana
20 Civic Center Plaza (M-37)
Santa Ana, CA 92702
Attn: Executive Director
NOTICE OF AFFORDABILITY RESTRICTIONS
ON TRANSFER OF PROPERTY
Street, Santa Ana, CA
(Owner-Occupied Unit)
NOTICE IS HEREBY GIVEN, that the Community Redevelopment
Agency of the City of Santa Ana (the "Agency"), to carry out certain
obligations under the Community Redevelopment Law of the State of
California (Health and Safety Code Section 33000 et seq.) and the
Redevelopment Plan for the Merged Redevelopment Project Areas, has
required , (the "Owner") to enter into certain
affordability covenants and restrictions entitled, DEED OF TRUST
INCLUDING AFFORDABLE HOUSING DEED RESTRICTIONS (the
"Restrictions") Recorded with the County Recorder concurrently with this
Notice, with reference to certain real property located at
Street, Santa Ana (the "Property"), within Orange County, California,
Assessor's Parcel No. , and further described in Exhibit "A,"
attached hereto and incorporated herein by reference.
The affordability covenants and restrictions contained in the Restrictions
include without limitation and as further described in the Restrictions:
1. bedroom, bathroom house to be restricted to
low/moderate income households for a period of 45 years.
This Notice of Affordability Restrictions is being recorded for the purpose of
providing notice only and it in no way modifies the provisions of the
Restrictions. In the event of any conflict between this Notice and the
Restrictions, the terms of the Restrictions shall prevail.
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EXHIBIT K
The Restrictions have been recorded concurrently herewith and shall remain
in effect for forty-five (45) years, unless the Property is sold pursuant to the
terms included in the Restrictions.
This Notice is being recorded and filed by the Agency in compliance with
Health and Safety Code sections 33334.3 and/or section 33413, as amended
effective this date, and shall be indexed against the Agency and the Owner.
IN WITNESS WHEREOF, the parties hereto have caused this Notice of
Affordability Restrictions to be executed on the date set forth at the
beginning of this Notice.
COMMUNITY REDEVELOPMENT AGENCY
of the City of Santa Ana
a public body, corporate and politic
By:
Nancy T. Edwards, Interim Executive Director
Community Redevelopment Agency
APPROVED AS TO FORM:
JOSEPH W. FLETCHER
Agency General Counsel
By:
Lisa E. Storck, Assistant Counsel
OWNER:
By:
EXHIBIT 1
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EXHIBIT L
VICINITY HIRING REPORT
Job/Position Dates Advertising Location
Available/Posted Medium
EXHIBIT 1
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EXHIBIT M
ADDITIONAL INSURED ENDORSEMENT
Insurance Company
This endorsement modifies such insurance as is afforded by the provisions of Policy
# relating to the following:
I . The City of Santa Ana located 20 Civic Center Plaza M-26, Santa Ana,
California 92701; and their respective officers, employees, agents, volunteers and
representatives are named as additional insureds ("additional insureds") with regard to
liability and defense of suits arising from the operations and uses performed by or on
behalf of the named insured.
2. With respect to claims arising out of the operations and uses performed by
or on behalf of the named insured, such insurance as is afforded by this policy is primary
and is not additional to or contributing with any other insurance carried by or for the
benefit of the additional insureds.
3. This insurance applies separately to each insured against whom claim is
made or suit is brought except with respect to the company's limits of liability. The
inclusion of any person or organization as an insured shall not affect any right which such
person or organization would have as a claimant if not so included.
4. With respect to the additional insureds, this insurance shall not be
cancelled, or materially reduced in coverage or limits except after thirty (30) days written
notice has been given to the Community Redevelopment Agency of the City of Santa
Ana, 20 Civic Center Plaza (M-26), Santa Ana, California 92701.
(Completion of the following, including countersignature, is required to make this
endorsement effective.)
Effective
Policy #
Issued to
this endorsement form as a part of
Named Insured
Countersigned by
Authorized Representative
EXHIBIT 1
25D-94