HomeMy WebLinkAboutMINUTES - 04012003 - C62 TO: REDEVELOPMENT AGENCY tY"
FROM: John Sweeten, Executive Director o,
DATE: April 1, 2003 sA -
SUBJECT: Second Modification Agreement—Rodeo Senior Mousing Project, Rodeo
SPECIFIC REQUEST(S)OR RECOMMENDATIONS(S)& BACKGROUND AND JUSTIFICATION
RECOMMENDATIONS
APPROVE and AUTHORIZE the Deputy Director-Redevelopment to execute a Second Modification Agreement
with the Rodeo Senior Apartments,Inc.,and an Amended and Restated Intercreditor Agreement with the County of
Contra Costa and Rodeo Senior Apartments, Inc. in substantially the form on file with the Clerk of the Board,
related to the 50 unit affordable Roden Senior Housing development in the Rodeo Redevelopment Project Area.
FISCAL IMPACT
No impact on the General Fund. The Agency made a loan for this project in the amount of$1,325,000,which was
provided for in the Agency's 2000-01 adopted budget. $910,000 of the original loan will be reallocated into a
revocable grant for the same development. No additional funds are being allocated to fund the revocable grant.
BACKGROUND/REASONS FOR RECOMMENDATIONS
A major goal of the Rodeo Redevelopment Plan is to improve and expand the supply of affordable housing in the
Project Area. The Rodeo Senior Housing project was a first crucial step in 4thieving thi` a The Rodeo
CONTINUED ON ATTACHMENT: X YES SIGNATURE `(� •' J e�°
(ZECOMMENDATION OF EXECTUTIVE DIRECTORICOUNTY ADMINIST6AT R
RECOMMENDATION OF AGENCY/BOARD COMMITTEE
�'APPROVE OTHER
SIGNATURE(S):
ACTION OF BO ON APPROVED AS RECOMMENDED OTHER
VOTE OF SUPERVISORS/COMMISSIONERS I HEREBY CERTIFY THAT THIS IS A TRUE
AND CORRECT COPY OF AN ACTION
X UNANIMOUS TAKEN AND ENTERED ON THE MINUTES
(ABSENT None )
AYES: NOES: OF THE BOARD OF SUPERVISORS ON THE
ABSENT: ABSTAIN: DATE SHOWN
DISTRICT III SEAT VACANT
Contact: Beth Lee,Community Development-335-1256 ATTESTED
_�rA ri1 1, 2003
cc: Redevelopment Agency JOHN SWEETEN, AGENCY SECRETARY,
County Administrator CLERK OF THE BOARD OF SUPERVISORS
County Counsel AT-NJ,)COUNTY ADMININISTRATOR
Auditor-Controller
Via Redevelopment B 1 f ', � �
Rodeo Senior Apartments,Inc. DEPUTY '� i
Municipal Advisory Council(MAC)has been a strong supporter of and has allocated redevelopment tax increment
funds to this project for more than three years.
Can October 6, 1998, the Redevelopment Agency entered into a Disposition,Development and Loan Agreement
(DLA)with Ecumenical Association for Housing,Inc.(EAH).The agreement provided for EAH to undertake the
development of an affordable senior housing project in the Rodeo Redevelopment Project Area.In the fall of 1999,
EAH successfully secured an award of the Department of Housing and Urban Development(HUD)Section 202
funding for this project.
On April 11,2000,the DLA was amended to incorporate$138,000 in Tosco Good Neighbor Agreement Funds,
administered by the Rodeo MAC, into the financial assistance being provided to EAH for the Rodeo Senior
Housing project.
On July 24,2001,the DLA was amended to provide the technical consistency necessary for the use of HUD funds
and changed the proposed use of the Agency assistance.
On October 26, 2001, the Agency conveyed the project land to Rodeo Senior Apartments, Inc. (an affiliate of
EAH), and pursuant to the DLA made a$1,463,000 loan (the "Agency Loan") for the development of Rodeo
Senior Housing. The project was completed and occupied in the fall of 2002.
The purpose of the proposed Second Modification Agreement is to reallocate$910,000 in Agency Loan funds
already disbursed for the project so that these funds become a revocable grant to Rodeo Senior Apartments,Inc..
The existing$1,463,000 Agency loan for the project was funded with$415,000 in housing tax increment funds,
$138,000 in TOSCO Good Neighbor funds,and$910,000 in proceeds of the 1999 Redevelopment Tax Allocation
Revenue Bonds(the"Bond Funds").All of these funds are currently structured as a residual receipts loan evidence
by a promissory note and secured by a deed of trust against the project.Pursuant to Internal Revenue Service(TRS)
requirements,the Bond Funds cannot be included in the Agency Loan without endangering the tax-exempt status
of the bonds.To achieve consistency with IRS requirements,the Second Modification Agreement provides for the
Bond Funds to be reallocated from the Agency Loan to a new revocable grant,which will only require repayment
in the event of a default.The remaining Agency funds,$415,000 in housing tax increment funds and$138,000 in
TOSCO Good Neighbor Funds,will remain as a residual receipts loan.
The Agency has proposed the Second Modification Agreement to reallocate the Bond Funds on the advice of bond
counsel to preserve the tax-exempt character of the 1999 Tax Allocation Bond Issue. The project owner has agreed
to the proposed modification.
The purpose of the proposed Amended and Restated Intercreditor Agreement is to reallocate the distribution of
residual receipts of the project between repayment of CDBG and HOME loan from the County and repayment of
the Agency Loan,to reflect the decreased principal amount of the Agency Loan.
C: rodeo sr. hsg\amend2.bos
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
Contra Costa County Redevelopment Agency
651 Pine Street, 4h Floor,North Wing
Martinez, CA 94533
Attention: Deputy Director- Redevelopment
No fee document pursuant to
Government Cade Section 278393
(SPACE ABOVE THIS LINE FOR RECORDER'S USE)
SECOND MODIFICATION AGREEMENT
(Rodeo Senior Apartments)
THIS SECOND MODIFICATION AGREEMENT(the "Agreement") is entered into as
of the day of , 2003,by and between the Contra Costa County Redevelopment
Agency, a public body, corporate and politic, of the State of California(the "Agency") and
Rodeo Senior Apartments, Inc., a California nonprofit public benefit corporation (the
"Developer").
RECITALS
A. On October 26, 2001, the Agency conveyed to the Developer that certain real
property located in an unincorporated area of Contra Costa County, and more particularly
described in Exhibit A attached hereto(the "Land"). The Agency conveyed the Land to
Developer pursuant to a Disposition, Development and Loan Agreement for Rodeo Senior
Housing, dated as of May 21, 1993, as amended by a First Amendment to the Disposition,
Development and Loan Agreement for Rodeo Senior Housing dated as of April 11, 2000, and a
Second Amendment to the Disposition, Development and Loan Agreement for Rodeo Senior
Housing dated as of October 1,2001 (as amended,the "DDLA"), all by and between EAH,Inc.
and the Agency. A Memorandum of the DDLA was recorded against the Land on October 26,
2001, as Instrument No. 01-0329288 of the Official Records of Contra Costa County. The
DDLA was assigned to the Developer pursuant to an Assignment and Assumption Agreement by
and among EAH, Inc., the Developer, and the Agency, dated as of October 1, 2001 (the
"Assignment Agreement").
B. Pursuant to the DDLA, the Agency provided a loan (the "Agency Loan")to the
Developer for the construction of improvements consisting of fifty(50)units of multifamily
senior rental housing known as Rodeo Senior Apartments (the "Improvements"). The Land and
the Improvements are collectively referred to herein as the "Project." The Agency Loan was in
the total principal amount of One Million Four Hundred Sixty-Three Thousand Dollars
($1,463,000), of which Nine Hundred Ten Thousand Dollars($910,000) was funded with the
proceeds of the $44,000,000 County of Contra Costa Public Financing Authority 1999 Tax
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Allocation Revenue Bonds(Pleasant Hill,North Richmond, Bay Point, Oakley and Rodeo
Redevelopment Project Areas) (the "Bond Proceeds"). The Agency Loan is evidenced by a
promissory note("Agency Dote") executed by the Developer in favor of the Agency dated
October 1, 2001, and secured by an Agency Deed of Trust and Security Agreement dated
October 1,2001, and recorded October 26, 2001, against the Project as Instrument No. 01-
329294 in the Official Records (the "Agency Deed of Trust").
C. The Agency Loan is subject to the terms and conditions of a Regulatory
Agreement and Declaration of Restrictive Covenants by and between the Agency and the
Developer dated October 1, 2001, and recorded October 26, 2001,against the Project as
Instrument No. 01-329293 in the Official Records (the "Agency Regulatory Agreement").
D. The Agency Note, the Agency Deed of Trust, the Agency Regulatory Agreement,
the DDLA, the DDLA Assignment Agreement, and the Memo of DDLA, all as further modified
pursuant to this Agreement, are hereinafter collectively referred to as the "Agency Loan
Documents."
E. The Agency and the Developer, entered into a Modification Agreement dated
in order to correct a clerical error concerning the Developer's name in the Agency
Loan Documents and other related documents.
F. The Agency and the Developer now desire to modify the Agency Loan
Documents to reallocate the Nine Hundred Ten Thousand Dollars($910,000)portion of the
Agency Loan that was funded with Bond Proceeds from the Agency Loan into a revocable grant
from the Agency to the Developer.
NOW, THEREFORE, in consideration of the mutual benefits accruing to the parties
hereto and other valuable consideration,the receipt and sufficiency of which consideration is
hereby acknowledged, it is hereby declared,understood and agreed as follows:
Section 1. Amendment of DDLA. The DDLA is hereby modified and amended as
follows:
(a) Agency Loan Amount. Section 4.1 of the DDLA is amended to:
(i)change the amount of the Agency Loan from One Million Four Hundred Sixty-Three
Thousand.Dollars($1,463,000)to Five Hundred Fifty-Three Thousand Dollars ($563,000),
(ii) change the amount of the Predevelopment Component of the Agency Loan from Seven
Hundred One Thousand Four Hundred Fifty-Seven Dollars ($701,457)to Five Hundred Fifty-
Three Thousand Dollars($553,000); and(iii)and to eliminate the Construction Component of
the Agency Loan.
(b) Agency Grant. A new Section 4.13 is added to Article 4 of the DDLA as
follows:
Section 4.13 Agency Grant. The Agency hereby agrees to make a grant to the
Developer in the amount of Nine Hundred Ten Thousand Dollars ('$910,000)(the
"Agency Grant"), consisting of Bond Proceeds. The Agency Grant was disbursed
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to the Developer for predevelopment and construction costs of the Development
and, as of the date of this Second Modification, all of the Agency Grant has been
disbursed to the Developer. The Agency Grant shall be a revocable grant,to be
repaid by the Developer only upon the occurrence of an Event of Default by the
Developer pursuant to Section 8.4 of the DDLA.
(c) Repayment of Grant. Section 8.6 of the DVLA is amended and restated to
read as follows:
Section 8.6 Acceleration of Note and Repayment of Grant. Following
occurrence of an Event of Default,after expiration of applicable notice and cure
periods, if any, the Agency shall have the right to cause all indebtedness of the
Developer to the Agency under this Agreement and the Agency Note, together
with any accrued interest on the Agency Loan,to become immediately due and
payable and the Agency shall have the right to require repayment of the Agency
Grant. The Developer waives all right to presentment,demand,protest or notice
of protest or dishonor. The Agency may proceed to enforce payment of the
indebtedness and repayment of the Agency Grant and to exercise any or all rights
afforded to the Agency as a creditor and secured party under the law including the
Uniform Commercial Code, including foreclosure under the Agency Deed of
Trust. The Developer shall be liable to pay the Agency on demand all expenses,
costs and fees (including,without limitation, attorney's fees and expenses)paid or
incurred by the Agency in connection with the collection of the Agency Loan and
the repayment of the Agency Grant and the preservation, maintenance,protection,
sale, or other disposition of the security given for the Agency Loan and the
Agency Grant
Section 2. Amendment of Agency Deed of Trust. The Agency Deed of Trust is
hereby amended to reduce the amount of the Agency Loan and the principal amount of the
Agency Note as stated in Section 1.1 and Section 1.3 of the Deed of Trust, respectively, from
One Million Four Hundred Sixty-Three Thousand Dollars ($1,463,000) to Five Hundred Fifty-
Three Thousand Dollars ($553,000). The Agency Deed of Trust is also hereby amended to
amend and restate Section 1.4 to read as follows:
Section 1.4 The term "Principal" means the aggregate of the amounts required
to be paid or repaid under the DDLA, including amounts due under the Note and
repayment of the Agency Grant following an Event of Default.
Section 3. Amendment of Agency Note. The Agency Note is hereby amended to
reduce the principal amount from One Million Four Hundred Sixty-Three Thousand Dollars
($1,463,000)to Five Hundred Fifty-Three Thousand Dollars ($553,000). The Agency and the
:Developer agree to place a notation on the original Agency Note, to be initialed by both the
Agency and the Developer,referring to this Second Modification Agreement and indicating that
the principal amount of the Agency Note has been reduced to Five Hundred Fifty-Three
Thousand Dollars ($553,000).
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Section 4. Amendment of Agency Regulatory Agreement. The Agency Regulatory
Agreement is hereby modified and amended to renumber the existing subsections 4.8 (b) and(c)
as 4.8 (c) and(d), respectively and to add a new subsection 4.8(b), reading as follows:
(b) Demanding RgRay ent of the-Agency Grant. The Agency may demand
immediate repayment of the Agency Grant, and proceed with foreclosure under
the Agency Deed of Trust.
Section 5. Full Force and Effect. Except as set forth in this Agreement, the Agency
Loan Documents remain unmodified and are in full force and effect.
Section. 6. Successors and Assi rms. This Agreement shall be binding on and inure to
the benefit of the legal representatives, heirs, successors and assigns of the parties.
Section 7. California Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California.
Section 8. Countemarts. This Agreement may be signed by the different parties
hereto in counterparts, each of which shall be deemed an original but all of which together shall
constitute one and the same agreement.
3201101167406.1 4
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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the day first
above written.
DEVELOPER:
RODEO SENIOR APARTMENTS, INC., a
California nonprofit Public benefit corporation
By:
Name:
Title:
AGENCY:
CONTRA COSTA COUNTY REDEVELOPMENT
AGENCY, a public body corporate and politic
By:
Name: James Kennedy
Title: Deputy Director-Redevelopment
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CONSENT OF JUNIOR.LENDER.
Bank of America,N.A., a national banking association(the "Bank") holds a deed of trust of the
Land recorded as Document Number 2401-329297 (the "Bank Deed of Trust") which is
subordinate to the Agency Deed of Trust. Bank hereby approves the amendments to the
documents described in this Agreement and confirms that, following recordation of this
Agreement, the lien position of the Bank Deed of Trust shall continue to be junior and
subordinate to the lien of the Agency Deed of Trust and the Agency Regulatory Agreement.
BAND.OF AMERICA,N.A.
By:
Name:
Title:
320\101167406.1
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STATE OF CALIFORNIA }
) ss.
COUNTY OF )
On , 2043,before me, ,personally
appeared , personally known to me (or proved to me on the basis of
satisfactory evidence)to be the person(s) whose name(s) is/are subscribed to the within
instrument and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s)or
the entity upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
STATE OF CALIFORNIA )
) ss
COUNTY OF )
On , 2003,before me, ,personally
appeared ,personally known to me (or proved to me on the basis of
satisfactory evidence)to be the person(s)whose name(s) is/are subscribed to the within
instrument and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s)on the instrument the person(s)or
the entity upon behalf of which the person(s)acted, executed the instrument.
WITNESS my hand and official seal.
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EXHIBIT A
Legal Description of the Land
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RECORDING REQUESTED PURSUANT
AND WHEN RECORDED MAIL TO:
Contra Costa County
Community Development Department
651 fine Street,No. Wing, 4' Floor
Martinez, CA 94553-1295
Attention: Deputy Director-Redevelopment
No fee for recording pursuant to
Government Code Section 27383
FIRST AMENDED AND RESTATED INTERCREDITOR AGREEMENT
(Rodeo Senior Apartments)
This First Amended and Restated Intercreditor Agreement(the "Agreement") is made as
of , 2003,by and among the Contra Costa County Redevelopment Agency, a
public body corporate and politic (the "Agency"), the County of Contra Costa, a political
subdivision of the State of California(the"County"), and Rodeo Senior Apartments, Inc., a
California nonprofit public benefit corporation (the "Borrower"), with reference to the following
facts:
A. Borrower has constructed fifty(50)units of multifamily senior rental housing in
the County of Centra Costa,on the real property described on the attached Exhibit A(the
"Property"). The Property and the improvements thereon are referred to herein as the
"Development."
B. EAH, Inc. and the Agency entered into a Disposition, Development and Loan
Agreement dated May 1, 1999, as amended by the First Amendment to Disposition Development
and Loan Agreement dated April 11, 2000, and the Second Amendment to Disposition
Development and Loan Agreement dated October 1, 2001 (the "DDLA"),which DDLA has been
assigned by EAH, Inc. to the Borrower. Pursuant to the DDLA,the Agency loaned to the
Borrower the sum of One Million Four Hundred Sixty-Three Thousand Dollars($1,463,000)(the
"Agency Loan"). The Agency Loan is evidenced by a promissory note from the Borrower to the
Agency of even date herewith(the "Agency Note") and a Regulatory Agreement and Declaration
of Restrictive Covenants by and between the Borrower and the Agency(the "Agency Regulatory
Agreement"). The Borrower's obligation to repay the Agency Loan, as evidenced by the Agency
Note, is secured by a deed of trust on the Development(the "Agency Deed.of Trust"). The
Agency and Borrower have entered into a Second Modification Agreement dated as of
—, 2003,pursuant to which the Agency Loan amount was reduced to Five Hundred
Fifty-Three Thousand Dollars($553,000).
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C. Pursuant to the CDBG/HOME Loan Agreement of even date herewith between
the County and Borrower,the County has agreed to loan the Borrower a total of One Million
Four Hundred Sixty-Nine Thousand One Hundred Seventy-Five Dollars ($1,469,175)(the
"County Loan") in Community Development Bloch Grant("CDBG") funds and HOME
Investment Partnership Act(HOME) funds to be used to acquire the Property and construct the
Development. The County Loan is evidenced by a promissory note by Borrower in favor of the
County(the "County Note") and a Regulatory Agreement and Declaration of Restrictive
Covenants by and between the Borrower and the County(the "County Regulatory Agreement").
The Borrower's obligation to repay the County Loan, as evidenced by the County Note, is
secured by a deed of trust on the Development(the "County Deed of Trust").
D. The Agency, the County and the Borrower(collectively, the "Parties")desire the
Agency Deed of Trust and the County Deed of Trust(collectively, the "Deeds of Tryst")to be
equal in lien priority, and the Parties wish for the Agency and County to share, based on the
Prorata Percentages (as defined below), in repayment of their loans from the Lenders' Share of
Residual Receipts of the Development(defined below) and in any proceeds derived from a
foreclosure of either or both of the Deeds of Trust. The Agency, the County and the Borrower
entered into an Intercreditor Agreement dated as of October 1,2001, and recorded on October
26, 2001, as Instrument No. 01-329297 in the Official Records (the "Original Intercreditor
Agreement"), to accomplish these purposes. The Parties now desire to enter into the Agreement
to amend and restate the Original Intercreditor Agreement to reflect the decreased principal
amount of the Agency Loan pursuant to the Second Modification Agreement.
NOW, THEREFORE, the Parties agree as follows:
I. .Definitions. The following terms shall have the following meanings in this
Agreement:
(a) Lenders' Share of Residual Receipts. "Lenders' Share of Residual
Receipts" shall mean eighty percent(80%) of Residual Receipts.
(b) Prorata Percentages. "Prorata Percentages" means. (i) for the Agency,the
percentage calculated by dividing the total Agency Loan funds disbursed to the Borrower by the
sum of the disbursed Agency Loan funds plus the disbursed County Loan Funds; and(ii) for the
County, the percentage calculated by dividing the total County Loan funds disbursed to the
Borrower by the sum of the disbursed County Loan funds plus the disbursed Agency Loan funds.
In calculating the Prorata Percentages, (1)Agency Loan funds and County Loan funds that have
been repaid shall be deemed not to have ever been disbursed, (2) accrued but unpaid interest on
the Agency Loan funds shall be deemed Agency Loan funds disbursed, and(3) accrued but
unpaid interest under the County Loan shall be deemed County Loan funds disbursed. Based on
the amount of Agency Loan and County Loan funds disbursed as of the date of this Agreement,
the Prorata Percentages are twenty-seven percent(27%)to the Agency and seventy-three percent
(73%)to the County.
(c) Residual Receipts. "Residual Receipts" means, in a particular calendar
year, during the term of the HUD Capital Advance, "Residual Receipts" as defined in the HUD
Capital Advance Regulatory Agreement to the extent HUD consents in writing to disbursement
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of Residual Receipts, and following expiration of the term of the HUD Capital Advance, the
amount by which Gross Revenue (as defined below) exceeds Annual Operating Expenses(as
defined below).
(i) Gross Revenue. "Gross Revenue," with respect to a particular
calendar year, shall mean all revenue, income,receipts, and other consideration actually received
from operation and leasing of the Development. "Gross Revenue" shall include,but not be
limited to: all rents, fees and charges paid by tenants, Section 8 payments or other rental subsidy
payments received for the dwelling units, deposits forfeited by tenants, all cancellation fees,
price index adjustments and any other rental adjustments to leases or rental agreements resulting
in actual income; proceeds from vending and laundry room machines; the proceeds of business
interruption or similar insurance; the proceeds of casualty insurance to the extent not utilized to
repair or rebuild the Development(or applied toward the cost of recovering such proceeds); and
condemnation awards for a taking of part or all of the Development for a temporary period.
"Gross Revenue" shall also include the fair market value of any goods or services provided in
consideration for the leasing or other use of any portion of the Development. "Gross Revenue"
shall not include tenants' security deposits, loan proceeds, capital contributions or similar
advances.
(ii) Annual Operating-Expenses. "Annual Operating Expenses" with
respect to a particular calendar year shall mean the following costs reasonably and actually
incurred for operation and maintenance of the Development to the extent that they are consistent
with an annual independent audit performed by a certified public accountant using generally
accepted accounting principles: property taxes and assessments imposed on the Development;
debt service currently due on a non-optional basis(excluding debt service due from residual
receipts or surplus cash of the Development)on loans associated with development of the
Development and approved by the Agency and the County; property management fees and
reimbursements, not to exceed fees and reimbursements which are standard in the industry and
pursuant to a management contract approved by the Agency and the County; premiums for
property damage and liability insurance; utility services not paid for directly by tenants,
including water, sewer, and trash collection; maintenance and repair; any annual license or
certificate of occupancy fees required for operation of the Development; security services;
advertising and marketing; cash deposited into reserves for capital replacements of the
Development in an amount not to exceed six tenths of one percent(0.6%) of the total
development cost of the Development; cash deposited into an operating reserve in an amount not
to exceed three percent(3%) of Annual Operating Expenses but with the operating reserve
capped at six(6)months of gross rent from the Development(as such rent may vary from time to
time); extraordinary operating costs specifically approved by the Agency and the County;
payments of deductibles in connection with casualty insurance claims not normally paid from
reserves,the amount of uninsured losses actually replaced, repaired or restored, and not normally
paid from reserves, and other ordinary and reasonable operating expenses approved by the
Agency and the County and not listed above. Annual Operating Expenses shall not include the
following: depreciation, amortization, depletion or other non-cash expenses or any amount
expended from a reserve account.
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2. Loans. The Agency shall make the Agency Loan to the Borrower in accordance
with the DDLA. The County shall make the County Loan to the Borrower in accordance with
the County Loan Agreement.
3. Prorata Repayment.
(a) Pursuant to the terms of the Agency Loan and the County Loan as set
forth in the loan documents for each loan,the Agency Loan and the County Loan shall be repaid
from the Residual Receipts of the Development, divided between repayment of the Agency Loan
and repayment of the County Loan in accordance with the Prorata Percentages. Payments shall
be due on November 1 of each calendar year, commencing on November 1, 2002, utilizing the
Residual Receipts from the previous fiscal year for the Development(July 1 to June 30). In the
event that Borrower makes any lump sum prepayment of the Agency Loan or the County Loan,
the Parties agree to divide such pre-payment amount between them in accordance with the
Prorata Percentages.
(b) The Agency Loan shall be repaid by the Borrower pursuant to the
repayment terms in the Agency Loan Agreement, Agency Note, and this Section 3. The Agency
shall not consent to any amendment or waiver of such repayment terms that might reasonably be
considered to impair the County's security under the County Loan without the County's prior
written approval, which the County may withhold in its sole discretion.
(c) The County Loan shall be repaid by the Borrower pursuant to the
repayment terms in the County Loan Agreement,the County Note, and this Section 3. The
County shall not consent to any amendment or waiver of such repayment terms that might
reasonably be considered to impair the Agency's security under the Agency Loan without the
Agency's prior written approval, which the Agency may withhold in its sole discretion.
4. Reports and Accounting;of Residual Receipts.
(a) Audited Financial Statement. In connection with the annual repayments
of the County Loan and the Agency Loan, the Borrower shall furnish to the County and Agency
an audited statement duly certified by an independent firm of certified public accountants
approved by the County and Agency, setting forth in reasonable detail the computation and
amount of Residual Receipts during the preceding Development Fiscal Year.
(b) Books and Records. The Borrower shall keep and maintain on the
Property, or at its principal place of business, or elsewhere with the County's and Agency's
written consent, full, complete and appropriate books,records and accounts relating to the
Development, including all such books, records and accounts necessary or prudent to evidence
and substantiate in full detail Borrower's calculation of Residual Receipts. Books, records and
accounts relating to Borrower's compliance with the terms,provisions, covenants and conditions
of this Agreement shall be kept and maintained in accordance with generally accepted
accounting principles consistently applied, and shall be consistent with requirements of this
Agreement which provide for the calculation of Residual Receipts on a cash basis. All such
books, records, and accounts shall be open to and available for inspection by the County and
Agency,their auditors or other authorized representatives at reasonable intervals during normal
business hours. Copies of all tax returns and other reports that Borrower may be required to
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furnish any governmental agency shall at all reasonable times be open for inspection by the
County and Agency at the place that the books, records and accounts of the Borrower are kept.
The Borrower shall preserve records on which any statement of Residual Receipts is based for a
period of not less than five(5)years after such statement is rendered, and for any period during
which there is an audit undertaken pursuant to subsection (c)below then pending.
(c) Audits. The receipt by the County or Agency of any statement pursuant to
subsection(a)above or any payment by Borrower or acceptance by the County or Agency of any
loan repayment for any period shall not bind the County or Agency as to the correctness of such
statement or such payment. Within three(3)years after the receipt of any such statement,the
County or Agency or any designated agent or employee of the County or Agency at any time
shall be entitled to audit the Residual Receipts and all books, records, and accounts pertaining
thereto. Such audit shall be conducted during normal business hours at the principal place of
business of Borrower and other places where records are kept. Immediately after the completion
of an audit, the County or Agency shall deliver a copy of the results of such audit to Borrower.
If it shall be determined as a result of such audit that there has been a deficiency in a loan
repayment to the County or Agency, then such deficiency shall become immediately due and
payable with interest at the default rate set forth in the Loan Agreement, determined as of and
accruing from the date that said payment should have been made. In addition, if Borrower's
auditor's statement for any Development Fiscal Year shall be found to have understated Residual
Receipts by more than five percent(5%) and at least Five Thousand Dollars($5,000), and the
County or Agency is entitled to any additional Loan repayment as a result of said
understatement, then Borrower shall pay, in addition to the interest charges referenced
hereinabove, all of the County's and/or Agency's reasonable costs and expenses connected with
any audit or review of Borrower's accounts and records.
(d) Maximization of Residual Receipts. Borrower agrees at all times during
the term of the Loan to continue its operations of the Development and to use its skills and
diligence to produce the maximum Residual Receipts, subject to the rent and occupancy
requirements of the County Regulatory Agreement, the HUD Capital Advance Documents and
the Agency Regulatory Agreement.
5. Securi . The Agency shall secure the Agency Loan with the Agency Deed of
Trust. The County shall secure the County Loan with the County Deed of Trust. The Agency
Deed of Trust shall be recorded prior to the County Deed of Trust,but the Agency and the
County agree that the Agency Deed of Trust and the County Deed of Trust shall be deemed to be
in co-equal lien position and further agree to share foreclosure proceeds as set forth in this
Agreement.
6. Notice of Default. Each Party shall notify the other Party promptly upon
declaring a default or learning of the occurrence of any material event of default, or any event
which with the lapse of time would become a material event of default, under its respective loan
documents for the Agency Loan and the County Loan.
7. Coordination of Remedies. In the event of a default under the Agency Loan
and/or the County Loan, after expiration of any applicable cure periods, the lender on the
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defaulted loan shall cooperate with the other lender to coordinate any foreclosure proceedings or
other appropriate remedies.
8. Sharing of Foreclosure Proceeds. If there is a foreclosure, or any other action,
judicial or nonjudicial,under either or both of the Deeds of Trust(including the giving of a deed
in lieu of foreclosure),then the Agency and the County shall be entitled to share based on the
Prorata Percentages in any proceeds which shall ensue from such action, after any and all senior
lienholders have been satisfied and after payment of all reasonable expenses of both the Agency
and the County incurred in connection with the action.
9. Co—Equal Deeds of Trust. If either of the Deeds of Trust is considered senior to
the other Deed of Trust, then notwithstanding the otherwise applicable effects of the California
Civil Code and the California Code of Civil Procedure:
(a) upon foreclosure of the Agency Deed of Trust and the elimination of the
security interest created by the County Deed of Trust, the holder of the foreclosing Agency Deed
of Trust shall share the foreclosure sale proceeds with the holder of the County Deed of Trust
based on the Prorata Percentages, and
(b) upon foreclosure of the County Deed of Trust, the holder of the
foreclosing County Deed of Trust shall share the foreclosure sale proceeds with the holder of the
Agency Deed of Trust based on the Prorata Percentages, and the holder of the Agency Deed of
Trust shall reconvey the Agency Deed of Trust.
10. Title to Property Following Foreclosure.
If either of the Agency or County is entitled to title to the Property as a consequence of
the Borrower's default, then title shall be held in tenancy in common by both the Agency and the
County, with the percentage ownership of each based on the Prorata Percentages. Subsequent
decisions to hold or sell the Property shall be made by joint decision of the Agency and the
County.
11. Notices.
Formal notices, demands, and communications between the Parties shall not be deemed
given unless dispatched by certified mail,return receipt requested, or express delivery service
with a delivery receipt, or personal delivery with a delivery receipt, to the principal office of the
Parties as follows:
Agency: Contra Costa County Redevelopment Agency
Community Development Department
651 Pine Street, North Wing, 4`h Floor
Martinez, CA 94553
Attn: Deputy Director—Redevelopment
County: County of Contra Costa
Community Development Department
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651 Pine Street,North Wing,4th Floor
Martinez, CA 94553
Attn: Deputy Director—Redevelopment
Borrower: Rodeo Senior Apartments, Inc.
2169 E. Francisco Blvd., Suite B
San Rafael, CA 94901
Attn: President
Such written notices, demands, and communications may be sent in the same manner to such
other addresses as the affected Party may from time to time designate as provided in this Section
10. Receipt shall be deemed to have occurred on the date marked on a written receipt as the date
of delivery or refusal of delivery(or attempted delivery if undeliverable).
12. Conflict.
In the event of any conflict between the provisions of this Agreement and the provisions of the
Agency Loan documents and/or the County Loan documents, the provisions of this Agreement
shall prevail.
13. Titles.
Any titles of the sections or subsections of this Agreement are inserted for convenience of
reference only and shall be disregarded in interpreting any part of the Agreement's provisions.
14. California Law. This Agreement shall be interpreted under and pursuant to the
laws of the State of California, other than the laws of that state governing choice of law.
15. Severability. If any term of this Agreement is held in a final disposition by a
court of competent jurisdiction to be invalid,then the remaining terms shall continue in full force
unless the rights and obligations of the Parties have been materially altered by such holding of
invalidity.
16. Attorney Fees. If any legal action is commenced to interpret or to enforce the
terms of this Agreement or to collect damages as a result of any breach of this Agreement,then
the Party prevailing in any such action shall be entitled to recover against the Party not prevailing
all reasonable attorneys' fees and costs incurred in such action.
17. Entire Agreement: Amendment and Restatement. This Agreement constitutes the
entire understanding and agreement of the Parties with respect to prorata repayment of the
Agency Loan and the County Loan. This Agreement amends, restates, and replaces the Original
Intercreditor Agreement in its entirety.
18. Counterparts. This Agreement may be executed in multiple originals, each of
which is deemed to be an original, and may be signed in counterparts.
19. Amendments. This Agreement shall not be modified except by written instrument
executed by and between the Parties.
320110\'(67453.1 7
3120/03
20. HUD-Reqfired Provisions aider. The HUD-Required Provisions Rider attached
hereto as Exhibit B, is hereby incorporated into this Agreement.
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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first
written above.
CONTRA COSTA COUNTY REDEVELOPMENT AGENCY
By:
James Kennedy
Deputy Director-Redevelopment
COUNTY OF CONTRA COSTA
By:
James Kennedy
Deputy Director o Redevelopment
RODEO SENIOR APARTMENTS, INC.
By:
Its: President
3201101167453.1 9
3120103
CONSENT OF JUNIOR LENDER
Bank of America,N.A., a national banking association(the "Bank")holds a deed of trust of the
Land recorded as Document Number 2001-329297 (the "Bank Deed of Trust")which is
subordinate to the Agency Deed of Trust, County Deed of Trust, Agency Regulatory Agreement,
County Regulatory Agreement and Original Intercreditor Agreement. Bank hereby approves the
amendments to the documents described in this Agreement and confirms that, following
recordation of this Agreement, the lien position of the Bank Deed of Trust shall continue to be
junior and subordinate to the lien of the Agency Deed of Trust, County Deed of Trust, Agency
Regulatory Agreement, County Regulatory Agreement, and Original Intercreditor Agreement.
BANK OF AMERICA, N.A.
By:
Name:
Title:
320\101167463.1 10
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STATE OF CALIFORNIA. )
) ss.
COUNTY OF )
On , 2003, before me, the undersigned, a Notary Public, personally
appeared , personally known to me (or proved to me on the basis of
satisfactory evidence)to be the person(s)whose name(s) is/are subscribed to the within
instrument, and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s)on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
STATE OF CALIFORNIA )
) ss.
COUNTY OF )
On _, 2003,before me, the undersigned, a Notary Public,personally appeared
,personally known to me (or proved to me on the basis of
satisfactory evidence)to be the person(s)whose name(s)is/are subscribed to the within
instrument, and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
3201101167453.1
3/20/03
STATE OF CALIFORNIA )
) ss.
COUNTY OF )
On . 2403,before me, the undersigned, a Notary Public, personally
appeared ,personally known to me (or proved to me on the basis of
satisfactory evidence)to be the person(s)whose name(s) is/are subscribed to the within
instrument, and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s)on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
320\90\967453.4
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EXHIBIT A
(Legal Description of the Property)
The land is situated in the State of California, County of Contra Costa, and is described
as:
320\10\167453.1 A-1
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EXHIBIT B
HUD-Required Provisions Rider
320110\167453.1 B-1
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